TSMC
Annual Report 2017

Plain-text annual report

i T a w a n S e m i c o n d u c t o r M a n u f a c t u r i n g C o m p a n y , L t d . A n n u a l R e p o r t 2 0 1 7 ( I ) TSMC Vision, Mission & Core Values TSMC’s Vision Our vision is to be the most advanced and largest technology and foundry services provider to fabless companies and IDMs, and in partnership with them, to forge a powerful competitive force in the semiconductor industry. To realize our vision, we must have a trinity of strengths: 1. be a technology leader, competitive with the leading IDMs 2. be the manufacturing leader 3. be the most reputable, service-oriented and maximum-total-benefits silicon foundry TSMC’s Mission Our mission is to be the trusted technology and capacity provider of the global logic IC industry for years to come. TSMC’s Core Values Integrity Integrity is our most basic and most important core value. We tell the truth. We believe the record of our accomplishments is the best proof of our merit. Hence, we do not brag. We do not make commitments lightly. Once we make a commitment, we devote ourselves completely to meeting that commitment. We compete to our fullest within the law, but we do not slander our competitors and we respect the intellectual property rights of others. With vendors, we maintain an objective, consistent, and impartial attitude. We do not tolerate any form of corrupt behavior or politicking. When selecting new employees, we place emphasis on the candidates’ qualifications and character, not connections or access. Commitment TSMC is committed to the welfare of customers, suppliers, employees, shareholders, and society. These stakeholders all contribute to TSMC’s success, and TSMC is dedicated to serving their best interests. In return, TSMC hopes all these stakeholders will make a mutual commitment to the Company. Innovation Innovation is the wellspring of TSMC’s growth, and is a part of all aspects of our business, from strategic planning, marketing and management, to technology and manufacturing. At TSMC, innovation means more than new ideas, it means putting ideas into practice. Customer Trust At TSMC, customers come first. Their success is our success, and we value their ability to compete as we value our own. We strive to build deep and enduring relationships with our customers, who trust and rely on us to be part of their success over the long term. Table of Contents 1. Letter to Shareholders 4 5. Operational Highlights 2. Company Profile 2.1 An Introduction to TSMC 2.2 Market/Business Summary 2.3 Organization 2.4 Board Members 2.5 Management Team 3. Corporate Governance 3.1 Overview 3.2 Board of Directors 5.1 Business Activities 5.2 Technology Leadership 5.3 Manufacturing Excellence 5.4 Customer Trust 5.5 Human Capital 5.6 Material Contracts 6. Financial Highlights and Analysis 6.1 Financial Highlights 6.2 Financial Status and Operating Results 6.3 Risk Management 10 10 10 16 18 24 34 34 34 3.3 Major Decisions of Shareholders’ Meeting and Board Meetings 41 7. Corporate Social Responsibility 3.4 Taiwan Corporate Governance Implementation as 7.1 Overview 74 74 75 80 83 85 89 92 92 98 103 118 118 Required by the Taiwan Financial Supervisory 7.2 Environmental, Safety and Health (ESH) Management 122 7.3 TSMC Education and Culture Foundation 7.4 TSMC Charity Foundation 7.5 TSMC i-Charity 7.6 Social Responsibility Implementation Status as Required by the Taiwan Financial Supervisory Commission 131 133 134 134 8. Subsidiary Information and Other Special Notes 138 8.1 Subsidiaries 8.2 Status of TSMC Common Shares and ADRs Acquired, Disposed of, and Held by Subsidiaries 8.3 Special Notes 138 143 143 Commission 3.5 Code of Ethics and Business Conduct 3.6 Regulatory Compliance 3.7 Internal Control System Execution Status 3.8 Status of Personnel Responsible for the Company’s Financial and Business Operation 3.9 Information Regarding TSMC’s Independent Auditor 3.10 Material Information Management Procedure 4. Capital and Shares 4.1 Capital and Shares 4.2 Issuance of Corporate Bonds 4.3 Preferred Shares 4.4 Issuance of American Depositary Shares 4.5 Status of Employee Stock Option Plan 4.6 Status of Employee Restricted Stock 4.7 Status of New Share Issuance in Connection with Mergers and Acquisitions 4.8 Financing Plans and Implementation 42 46 50 52 53 53 55 58 58 66 68 68 70 70 70 70 002 003 1. Letter to Shareholders Dear Shareholders, 2017 Financial Performance 2017 was a solid year for TSMC as we delivered another year of record revenue, net income and earnings per share. TSMC’s technology leadership and manufacturing excellence, as well as our ongoing commitment to R&D and capacity investment, enabled us to capture opportunities in mobile devices, high-performance computing, the Internet of Things, and automotive semiconductors. Our continuing technological progress across the broad spectrum of advanced semiconductor process technologies lays a good foundation and builds a strong momentum for TSMC in the coming years. “Being everyone’s foundry” is at the heart of TSMC strategy. Through the expansion of our technology and services, we build an open platform that welcomes all innovators in the semiconductor industry to realize their innovations and see their products brought to market in volume quickly. TSMC’s ability to address the increasing needs for specific technology requirements, through the most comprehensive range of technology offerings and our vast and flexible manufacturing capacity, enable us to cast a wide net to capture the varying waves of product innovations in the semiconductor industry. In 2017, we saw computation expanding in the cloud and on the edge; major mobile products with enriched features adopted advanced processes; the need for safer, smarter and greener vehicles drove strong automotive semiconductor demand; and the readiness of ubiquitous connectivity provided exciting growth in the Internet of Things (IoT). AI (artificial intelligence) is expected to be embedded in all the above applications. As “everyone’s foundry”, we were able to participate in these growing segments of the industry and continued to expand our foundry market segment share. We continued to make significant advances in leading-edge process technologies in 2017. 10-namometer set a new record in terms of ramp-up speed, and represented 10% of our total wafer revenue in its first year. Our industry-first 7-nanometer was transferred from R&D to manufacturing in 2017, and will begin volume production in the second quarter of 2018. Our 7-nanometer+ will follow and enter risk production later in 2018. We broke ground for Fab 18 in January 2018 for 5-nanometer, which will see extensive use of EUV (extreme ultraviolet) lithography with volume production targeted to start in 2020. Our proprietary CoWoS® (Chip on Wafer on Substrate) and InFO (integrated fan-out) advanced packaging solutions also continue to see enthusiastic adoption by customers in HPC (high performance computing), mobile and other high speed applications. Highlights of TSMC’s accomplishments in 2017: ● Total wafer shipments increased 8.8 percent from 2016 to reach 10.5 million 12-inch equivalent wafers. ● Advanced technologies (28-nanometer and beyond) accounted for 58 percent of total wafer revenue, up from 54 percent in 2016. ● We deployed 258 distinct process technologies, and manufactured 9,920 products for 465 customers. ● TSMC’s market share in the total semiconductor foundry segment rose successively during the last eight years and reached 56 percent in 2017. In 2017, our consolidated revenue totaled NT$977.45 billion, an increase of 3.1 percent over NT$947.94 billion in 2016, despite a significant appreciation in the NT dollar in this period. Net income was NT$343.11 billion and diluted earnings per share were NT$13.23. Both increased 3 percent from the 2016 level of NT$334.25 billion net income and NT$12.89 diluted EPS. Gross profit margin was 50.6 percent compared with 50.1 percent in 2016, while operating profit margin was 39.4 percent compared with 39.9 percent a year earlier as R&D spending ratio increased. Net profit margin was 35.1 percent, a decrease of 0.2 percentage points from the prior year’s 35.3 percent. TSMC further raised its cash dividend payment to NT$7.0 per share for 2016 profit distribution from NT$6.0 a year ago. Technological Developments In 2017, we have increased our R&D expense by 13.5% over 2016, with a large number of new technology introduction, to meet our customer needs and to extend our technology leadership. TSMC’s 28/22-nanometer technology saw a record number of product tape-outs in 2017, thanks to its differentiated and diverse offerings. To further enhance the technology performance, we have also developed 22ULP (ultra-low power) and 22ULL (ultra-low leakage) technologies to address IoT and RF-related applications. We are confident that our continued performance enhancement, strong manufacturing capability, and flexible capacity can further strengthen our position in 28/22-nanometer node for years to come. TSMC’s 16-nanometer FinFET technology remains robust as it enters its fourth year of volume production in 2018. Strong tape-out activities covered a variety of mainstream smartphones, cryptocurrency, AI, GPU and RF products. We continued to expand the technology portfolio by developing 12FFC (FinFET Compact) in 2017, which drives die size and power efficiency to serve demand in mobile, consumer electronics, digital TV and IoT applications. 10-nanometer FinFET technology started high-volume shipments in early 2017 and successfully supported a major customer’s new mobile product launches. Thanks to its aggressive geometric shrinkage, this technology provides excellent density/cost benefits to support customer needs in performance-driven market segments, including application processors, cellular baseband and ASIC CPUs. As a result, we expect a continued growth of our 10-nanometer business in 2018. 004 005 We successfully introduced TSMCÕ s 7-nanometer technology in 2017. Customer adoption of 7-nanometer is very strong and we received more than ten product tape-outs in 2017. A total of more than 50 customer product tape-outs are expected by the end of 2018. TSMCÕ s 7-nanometer+ technology will be introduced in 2018. We have already demonstrated the same yield level of 256M bit SRAM as compared to 7-nanometer. Furthermore, TSMCÕ s 5-nanometer technology development is well on track for risk production in the first quarter of 2019. Both device performance and SRAM development vehicle yield improvement are on our plan. Customer test chips are already running in our fab. In advanced packaging, TSMCÕ s second generation InFO technology began volume production for advanced mobile products in 2017, while InFO_oS (Integrated Fan-Out on Substrate) technology is expected to complete qualification in 2018 for HPC (high performance computing) products. We also extended our interposer CoWoS¨ actively developing 7-nanometer solutions to further support the requirements of HPC applications, such as AI, data server, and networking. technology to 12-nanometer and are TSMCÕ s ecosystem, the Open Innovation Platform¨ innovations with fast time-to-market. We continued to work with our ecosystem partners to expand our libraries and silicon IP portfolio in 2017 to more than 16,000 items. More than 9,000 technology files and over 300 process design kits were available to customers via TSMC-Online which saw more than 100,000 customer downloads in 2017. (OIP), is an important factor in empowering customers to unleash their Corporate Developments In October 2017, I, as TSMC Chairman for the last thirty years, announced my plan to retire from the Company immediately after the Annual ShareholdersÕ Meeting in early June, 2018. All present directors of the board, except myself, have unanimously agreed to be nominated, and if elected, will serve as directors of the board during the next term. They all have agreed to have TSMC under the dual leadership of Dr. Mark Liu and Dr. C.C. Wei, who are TSMCÕ s presidents and Co-CEOs currently. Dr. Liu will be the Chairman of the Board, and Dr. Wei will be the Chief Executive Officer. Honors and Awards TSMC received recognition for achievements in innovation, business information disclosure, corporate governance, sustainability, investor relations and overall excellence in management from organizations including Forbes, Fortune Magazine, Newsweek, CommonWealth Magazine, The Nikkei, PricewaterhouseCoopers, RobecoSAM and the Taiwan Stock Exchange. TSMC continued to receive multiple awards from Institutional Investor Magazine and was ranked among the top global companies by IR Magazine. TSMC was chosen once again as a component of the Dow Jones Sustainability Indices, becoming the only semiconductor company to be selected for 17 consecutive years. Meanwhile, we remained a major component in both MSCI ESG and FTSE4Good Emerging Index, reflecting our ongoing commitment to sustainability and corporate social responsibility. Capacity Plan Wafer Sales Plan 10% 2016 10% 2017 9% 2018 Annual Growth Rate Capacity: million 12-inch equivalent wafers Outlook 10-11 11-12 12-13 2016 2017 2018 46% 42% 30-40% 54% 58% 60-70% > 28nm wafer revenue ≤ 28nm wafer revenue 2018 wafer shipment is expected to be 11-12 million 12-inch equivalent wafers. TSMCÕ s enduring business model, our ecosystem of partnerships across the industry, and our core values of integrity, commitment, innovation, and customer trust have well positioned us to serve as Ò everyoneÕ s foundryÓ and enabled win-win partnership between TSMC and IC innovators. TSMC will continue to advance our semiconductor process technologies and strengthen our manufacturing capabilities to meet the ever-increasing requirements of our customers and stay at the forefront to unleash innovation. As technology and end applications undergo unprecedented change for the new digital age, our dedicated foundry business model will remain the foundation of our success. Our business model will continue to lead our way in creating value and generating strong returns to our shareholders. I would like to personally thank our shareholders for your long-term support to TSMC. While we have come a long way over the past thirty years, there is still much more ahead of us to achieve, and I am ever more confident that the best is yet to come. Morris Chang Chairman 006 007 008 008 008 009 009 009 009 2. Company Profile 2.1 An Introduction to TSMC 2.2 Market/Business Summary Established in 1987 and headquartered in Hsinchu Science Park, Taiwan, TSMC pioneered the pure-play foundry business model by focusing solely on manufacturing customers’ products. By choosing not to design, manufacture or market any semiconductor products under its own name, the Company ensures that it never competes directly with its customers. Today, TSMC is the world’s largest semiconductor foundry, manufacturing 9,920 different products using 258 distinct technologies for 465 different customers in 2017. With a large and diverse global customer base, TSMC-manufactured semiconductors are used in a wide variety of applications covering many segments of the computer, communications, consumer, industrial and standard semiconductor markets. Strong diversification helps to smooth fluctuations in demand, which, in turn, helps TSMC maintain higher levels of capacity utilization and profitability. Annual capacity of the manufacturing facilities managed by TSMC and its subsidiaries exceeded 11 million 12-inch equivalent wafers in 2017. These facilities include three 12-inch wafer GIGAFAB® fabs, four 8-inch wafer fabs, and one 6-inch wafer fab in Taiwan, as well as one 12-inch wafer fab at a wholly owned subsidiary: TSMC Nanjing Company Limited, and two 8-inch wafer fabs at wholly owned subsidiaries: WaferTech in the United States and TSMC China Company Limited. In 2016, TSMC Nanjing Company Limited was established, managing a 12-inch wafer fab and a design service center. TSMC provides customer service through its account management and engineering services offices in North America, Europe, Japan, China, and South Korea. At the end of 2017, the Company employed more than 48,000 people. The Company is listed on the Taiwan Stock Exchange (TWSE) under ticker number 2330, and its American Depositary Shares (ADSs) are traded on the New York Stock Exchange (NYSE) under the symbol TSM. 2.2.1 TSMC Achievements In 2017, TSMC maintained its leading position in the total foundry segment of the global semiconductor industry, with an estimated market share of 56%, despite intense competition from both established players and relatively new entrants to the business. Leadership in advanced process technologies is a key factor in the Company’s strong market position. In 2017, 58% of TSMC’s wafer revenue came from advanced manufacturing processes (geometries of 28nm and below), up from 54% in 2016. With TSMC’s focus on customer trust, the Company strengthened its Open Innovation Platform® (OIP) initiative in 2017 with additional services. TSMC held its 2017 Open Innovation Platform® Ecosystem Forum in September in Santa Clara, California, and in November in Shenzhen. The annual event demonstrates how TSMC and our ecosystem partners jointly develop design solutions on top of TSMC’s advanced technologies through OIP collaboration. TSMC executive delivered keynote on TSMC’s design enablement platforms, together with each platform’s respective solutions jointly developed and delivered with OIP partners. Feature talks by three executives of TSMC’s EDA/IP partners followed, highlighting their long-term collaboration with TSMC that helps customers innovate and capture market opportunities. TSMC offers the foundry segment’s broadest technology portfolio and continues to invest in advanced technologies and specialty technologies, which provide customers more added value and are key differentiators for TSMC vis-à-vis our competitors. In 2017, the Company either developed or introduced the following: Logic Technology ● 5nm FinFET (Fin field-effect transistor) technology development is progressing smoothly. Risk production of this technology is planned for the first quarter of 2019. Compared to 7nm FinFET technology, 5nm FinFET offers over 15% speed improvement or 30% power reduction. In addition, 5nm FinFET technology is optimized upfront for both mobile applications and high-performance computing devices. ● 7nm FinFET technology development was completed and entered risk production in April 2017 as planned. Customer adoption was strong and we received more than ten product tape-outs in 2017. A very fast yield ramp-up is expected as more than 95% of tools for 7nm FinFET technology are compatible with those for 10nm FinFET technology. Compared to 10nm FinFET technology, 7nm FinFET offers approximately a 25% speed improvement or a 35% power reduction. In addition, 7nm FinFET technology can be optimized for mobile applications and high-performance computing devices. ● 10nm FinFET technology started high-volume shipments in the first quarter of 2017. Thanks to its aggressive geometric shrinkage, this technology provides excellent density/cost benefits to support customer needs in performance-driven market segments, including mobile, server and graphics. ● 12nm FinFET Compact technology (12FFC) completed all process qualifications in the second quarter of 2017 and entered volume production in the second half of the year. 12FFC technology is TSMC’s latest 16nm family offering following 16nm FinFET Plus technology (16FF+) and 16nm FinFET Compact technology (16FFC). 12FFC drives die size and power consumption to the best levels of the foundry’s 16/14nm technology. 16FF+, which first entered volume production in 2015, is aimed at customers in high-performance market segments, including mobile, server, graphics, and cryptocurrency. The cost-effective 16FFC started volume production in the first quarter of 2016. 16FFC can maximize die cost scaling by incorporating optical shrink and process simplification at the same time. Both 16FFC and 12FFC can satisfy customer needs in mainstream and ultra-low-power (ULP) market segments, including low-end to mid-range mobile phones, consumer electronics, digital TV and the IoT (Internet of Things). With innovative standard cell structures, 12FFC can also be used in more advanced applications. So far, 16FF+/16FFC/12FFC have received a total of more than 200 product tape-outs, most of which have been first-time silicon successes. ● 22nm ultra-low power (22ULP) technology was developed based on TSMC’s industry-leading 28nm technology and is expected to start production in the second half of 2018. Compared to 28nm High Performance Compact (28HPC) technology, 22ULP provides 10% area shrink with more than 30% speed gain or more than 30% power reduction for applications including image processing, digital TV, set-top box, smartphone, IoT and consumer products. ● 22nm ultra-low leakage (22ULL) technology development achieved good progress. New ULL device and ULL SRAM can provide lower power consumption compared to 40ULP and 55ULP solutions. 22ULL technology targets the IoT and wearable devices applications and is expected to start risk production in the second half of 2018. ● 28nm high performance compact plus (28HPC+) technology accumulated more than 150 product tape-outs as of 2017. 28HPC+ technology provides further performance enhancement or power reduction in mainstream smartphone, digital TV, storage, audio and SoC (System-on-Chip) applications. Compared to 28HPC technology, 28HPC+ technology improves device performance by 15% or reduces leakage by 50%. 28HPC+ technology enables low Vdd (voltage drain) designs in ULP applications for the IoT market and is seamlessly applicable to the 28nm ecosystem, accelerating time-to-market for customers. ● 40nm ULP technologies received over 20 product tape-outs in 2017. These technologies target the IoT and wearable devices applications, such as wireless connectivity, application processors and sensor hub applications. In addition, TSMC uses its leading 40nm ULP Near-Vt (Near Threshold Voltage) technology to produce the world’s lowest energy consumption solutions for IoT devices and for wearable connected devices. Still under development are new enhanced analog devices that will enrich the 40ULP platform to support customers for more analog design needs in the future. ● 55nm ultra-low power (55ULP) technology volume production continued and accumulated more than 40 customer tape-outs as of 2017. Compared to 55nm Low Power (55LP) process, 55ULP can significantly increase battery life for IoT applications. In addition, it integrates RF and eFlash (embedded Flash) to simplify customers’ SoC designs. 010 011 Specialty Technology ● 16FF+ technology began production for customer applications in the automotive industry in 2017. 16FFC Foundation IPs (intellectual properties) passed the Automotive Electronic Council AEC-Q100 Grade-1 qualification and were certified for functional safety standard ISO 26262 ASIL-B. In addition, TSMC 9000A was introduced for automotive IP management to complete the automotive ecosystem with third-party IP vendors. ● 16FFC RF technology was extended to next generation Wireless Local Area Network (WLAN 802.11ax) and Millimeter Wave (mmWAVE) applications, in addition to wireless connectivity applications such as smartphone, the 5th generation mobile network (5G). ● 22nm RF (22ULP RF) technology supports high Ft devices and more flexible process design kits (PDK), while providing reliable simulation models for chip development and production for 5G mobile and wireless communication systems, mmWave, RF TRx and IoT applications. ● 28nm RF (28HPC RF and 28HPC+ RF) technologies offer >300 Gigahertz (GHz) high-frequency devices and support wireless components in smartphone, automotive and IoT applications. ● 40nm ULP embedded flash, which began volume production in 2016 for applications such as wireless MCU (Microcontroller Unit) IoT devices, wearable devices, and high-performance MCU, is expected to complete Automotive Electronic Council AEC-Q100 qualification in 2018. ● 40nm ULP embedded Resistive Random Access Memory (RRAM) completed technology development and was ready for risk production by the end of 2017. Applications include wireless MCU, IoT and wearable devices. ● 0.13µm SPAD (Single-Photon Avalanche Diode) technology platform speeds up customer product development of LiDAR (Light Detection and Ranging) applications. 3D (Three Dimensional) imaging and sensing are becoming more important for machine vision, and LiDAR is a critical technology to serve these applications. Customers can use TSMC’s industry-leading SPAD platform to design SPAD sensors and achieve the best time-to-market, which will greatly accelerate LiDAR’s use in automotive and security industries. ● 12-inch 0.13µm BCD (Bipolar-CMOS-DMOS) Plus technology, which provides superior cost competitiveness compared to the prior 0.13µm BCD technology, passed process validation by customers and started production in the second half of 2017. ● 0.18µm BCD third generation, which provides superior cost competitiveness compared to the second generation, also passed process validation by customers and started volume production in the second half of 2017. ● In addition to TSMC’s popular capacitive fingerprint sensor technology, the Company expanded its technology offering for optical fingerprint sensing, from 0.18µm and 0.11µm CMOS image sensors (CIS) to collimator, enabling customers to customize their optical fingerprint sensors. Fingerprint sensing is a critical authentication scheme for many electronic communications and payment systems. ● A Piezo technology pilot line was set up in 2017 to help customers design and develop new products for micro speakers, microphones, ultrasonic sensors, and various types of actuators serving medical and health applications. Piezo technology is a new area in MEMS (Micro-electromechanical Systems) with high potential. New types of piezoelectric thin film materials have been pre-characterized, so that customers can focus on product design and architecture to achieve best time-to-market. Advanced Packaging Technology ● For advanced mobile device applications, TSMC began volume production of the second generation of InFO-PoP (Integrated Fan-Out, Package on Package) technology that integrates 10nm SoC and DRAM for advanced mobile products in the second quarter of 2017. ● For high performance computing applications, TSMC began production of CoWoS® (Chip on Wafer on Substrate) technology, featuring heterogeneously integrating 12nm SoC plus four stacks of 8-hi (8 high) second generation high bandwidth memory (HBM2) on an about 1500mm2 interposer, in the first half of 2017. Also, TSMC successfully developed a CoWoS® module that integrates a 16nm SoC and more than four 8-hi HBM2 stacks in 2017. ● In addition to CoWoS®, InFO_oS (Integrated Fan-Out on Substrate) technology integrating multiple SoC chips is expected to complete qualification in 2018. ● Continued volume production of fine pitch Cu bump for flip chip packaging on ≥10nm silicon in 2017. In addition, Cu bump on 7nm silicon was qualified for production in 2018. TSMC also continued volume production on ≥28nm silicon in WLCSP (Wafer Level Chip Scale Packaging) technologies for high-end smartphone applications in 2017 and completed 16nm WLCSP qualification for 2018 production. 2.2.2 Market Overview TSMC estimates that the worldwide semiconductor market in 2017 was US$434 billion in revenue, representing a strong 22% year-over-year growth, after a flat year in 2016. In the foundry segment of the semiconductor industry, total revenue was US$53 billion in 2017, up 7% year-over-year, close to the 8% growth in 2016. 2.2.3 Industry Outlook, Opportunities and Threats Industry Demand and Supply Outlook Back-to-back years of growth in the foundry segment were driven mainly by healthy market demand. TSMC forecasts that the total semiconductor market excluding memory will grow 5% in 2018. Over the longer term, fueled by increasing semiconductor content in electronic devices, continuing market share gains by fabless companies, gradual increases in IDM outsourcing, and expanding in-house application- specific integrated circuits (ASIC) from systems companies, the Company expects foundry segment revenue growth to be much stronger than the 4% compound annual growth rate projected for the overall semiconductor industry excluding memory from 2017 through 2022. As an upstream supplier in the semiconductor supply chain, the foundry segment is tightly correlated with the market health of the three “C” sectors, communications, computers and consumer goods, as well as with the emerging IoT markets. ● Communications For the communications sector, smartphone’s unit shipment grew 3% in 2017. Although the growth has slowed down in recent years, TSMC projects a steady low-single digit increase in the smartphone market in 2018 thanks to the continuing transition to 4G/LTE, LTE-Advanced and LTE-Advanced Pro. Improved performance, longer battery life, biosensors and more AI features will continue to propel smartphone sales; and the increasing popularity of low-end smartphones in emerging countries will also drive growth in this sector. Low-power IC is an essential requirement among handset manufacturers. And SoC design, in which TSMC is already the leader, is the preferred solution due to its optimized cost, power and form factor (device footprint and thickness) potential. The migration to advanced process technologies will continue to accelerate, spurred by the appetite for higher performance to run AI applications, various complex software routines and higher resolution video. ● Computer After a 6% decline in 2016, the overall computer sector’s unit shipment dropped another 3% year-over-year in 2017. The decline was due to personal computer's prolonged replacement cycle and consumer usage moving towards mobile computing, partially offset by server unit's positive growth. The computer sector is expected to continue its low-single digit unit decline in 2018. However, several factors are expected to help buoy computer sector demand, including increasing form varieties, the business adoption of new operating systems, and consumer replacements of aging PCs; as well as the growing high performance applications, including machine learning, blockchain, and cryptocurrency mining. All these require lower power and higher performance CPU, GPU, HDD Controller, and ASICs, which will drive computer sector towards richer silicon content and more advanced process technologies. ● Consumer Compared to a 5% decline in 2016, consumer unit shipments fell 4% in 2017. TV game consoles showed positive growth, while the rest of the sector – TVs, set-top boxes, MP3 players, digital cameras and hand-held game consoles – decreased due to high LCD panel and memory cost, as well as functional cannibalization by smartphones. Continued drop in consumer electronics is expected in 2018, while certain sub-segments such as TV game consoles and 4K (UHD) TVs should achieve positive growth within the sector. With its broad array of advanced technology offerings, TSMC expects to take advantage of the trend in this market toward more AI functions (e.g. voice recognition/control) to be incorporated in TVs and set-top boxes. ● IoT The Internet of Things (IoT) is fast becoming the “next big thing,” as more and more devices are being connected to the internet. By 2025 it is estimated that the IoT’s installed unit base will be ten times greater than that of smartphones. Applications and products benefiting from IoT related technologies include smart wearables, home robots, smart meters, smart manufacturing, self-driving cars, and so on. These applications and products will require much longer battery life, diversified sensors and low-power wireless connections, which will challenge technology development in 012 013 new ways. TSMC’s ultra-low-power logic and RF solutions and diversified sensing technologies will lead the way for this future growth. and backend integration capabilities that create the optimum power/performance/area “sweet spot” and result in faster time-to-production. Supply Chain The electronics industry features a long and complex supply chain, the elements of which are correlated and highly interdependent. At the upstream manufacturing level, IC vendors need to have sufficient and flexible supply deliveries to handle fluctuating demand dynamics. Foundry vendors play an important role to ensure the health and effectiveness of the supply chain. As a leader in the foundry segment, TSMC provides advanced technologies and large-scale capacity to complement the innovations created along the downstream chain. 2.2.4 TSMC Position, Differentiation and Strategy Position TSMC is the worldwide semiconductor foundry leader for both advanced and specialty process technologies, commanding a 56% market share in 2017. Net revenue by geography, based mainly on the country in which customers are headquartered, was: 64% from North America; 11% from the Asia Pacific region, excluding China and Japan; 11% from China; 7% from Europe, the Middle East and Africa; and 7% from Japan. Net revenue by end-product application was: 10% from the computer sector, 59% from communications, 8% from consumer products, and 23% from industrial and standard products. Differentiation TSMC’s leadership position is based on three defining competitive strengths and a business strategy rooted in the Company’s heritage. The Company distinguishes itself from the competition through its technology leadership, manufacturing excellence and customer trust. As a technology leader, TSMC is consistently first among dedicated foundries to provide next-generation, leading-edge technologies. The Company has also established its leadership on more mature technology nodes by applying the lessons learned on leading-edge technology development to enrich its specialty technologies to more advanced process nodes. Beyond process technology, TSMC has established frontend TSMC, well known for its industry-leading manufacturing management capabilities, extends that leadership through its Open Innovation Platform® and Grand Alliance initiatives. The TSMC Open Innovation Platform® initiative quickens the pace of innovation in the semiconductor design community and among its ecosystem partners, as well as the Company’s own IP, design implementation and design for manufacturing capabilities, process technology and backend services. A key element is a set of ecosystem interfaces and collaborative components initiated and supported by TSMC that more efficiently empower innovation throughout the supply chain and drive the creation and sharing of new revenue and profits. The TSMC Grand Alliance is one of the most powerful forces for innovation in the semiconductor industry, bringing together customers, electronic design automation (EDA) partners, IP partners, and key equipment and material suppliers at a new, higher level of collaboration. Its objective is to help customers, alliance members and TSMC win business and increase competitiveness. The foundation for customer trust is a commitment TSMC made when it opened for business in 1987 to never compete with its customers. As a result, TSMC has never owned or marketed a single semiconductor product, but instead has focused all of its resources on becoming the trusted foundry for its customers. Strategy TSMC is confident that its differentiating strengths will enable it to prosper from the foundry segment’s many attractive growth opportunities. In light of the rapid growth in four major markets, namely mobile, high-performance computing, automotive electronics, and the Internet of things (IoT), and the fact that focus of customer demand is shifting from process- technology-centric to product-application-centric, TSMC has constructed four different technology platforms to provide customers with the most comprehensive and competitive logic process technologies, specialty technologies, IPs, and packaging and testing technologies to shorten customers’ time-to-design and time-to-market. Mobile platform: TSMC offers leading process technologies such as 7nm FinFET, 10nm FinFET, 16nm FinFET Plus technology, and 20nm SoC logic process technologies, as well as comprehensive IPs for premium product applications to further enhance chip performance, reduce power consumption, and decrease chip size. For low-end to high-end product applications, TSMC offers leading process technologies such as 12nm FinFET Compact technology, 16nm FinFET compact technology, 28nm high performance compact, 28nm high performance mobile compact plus, and 22nm ultra-low power logic process technologies, in addition to comprehensive IPs to satisfy customer needs for high-performance and low-power chips. Furthermore, for premium, high-end, mid-level, and low-end product applications, TSMC also offers the most competitive, leading-edge specialty technologies, including RF, embedded flash memory, emerging memory technologies, power management, sensors, and display chips as well as advanced packaging technologies such as the leading integrated fan-out (InFO) technology. High-performance computing platform: TSMC provides customers with leading process technologies such as 7nm FinFET and 16nm FinFET, as well as comprehensive IPs, including high-speed interconnect IPs, to meet customers’ high-performance computing and communication requirements. TSMC also offers multiple advanced packaging technologies such as CoWoS® and 3D IC technologies to enable homogeneous and heterogeneous chip integration to meet customers’ performance, power, and system footprint requirements. TSMC will continue to optimize its high-performance computing platform offerings to help customers capture market growth driven by data explosion and application innovation. Automotive electronics platform: TSMC offers leading 7nm FinFET, 16nm FinFET, 28nm, and 40nm logic process technologies, various leading and competitive specialty technologies in RF, embedded flash memory, sensors, multiple power management technologies that pass the AEC-Q100 qualifications. IoT platform: TSMC provides industry’s leading and comprehensive ultra-low power technology platform to support innovations for IoT and wearable applications. TSMC’s leading offerings, including 55nm ULP, 40nm ULP, 28nm ULP, 22nm ULP/Ultra-low leakage, have been widely adopted by various IoT and wearable applications. TSMC extends its offering with Near-Vt technology for extreme low power applications. TSMC also offers the most competitive and leading-edge specialty technologies in RF, embedded flash memory, emerging memory, sensors, and display chips, as well as multiple advanced packaging technologies including leading InFO technology. TSMC continually strengthens its core competitiveness and deploys both short-term and long-term technology and business development plans, and assists customers in taking on the challenges of short product cycles and intense competition in the electronic products market to meet ROI and growth objectives. ● Short-Term Semiconductor Business Development Plan 1. Substantially ramp up the business and sustain advanced technology market share by continually increased capacity and R&D investments. 2. Maintain mainstream technology market share by expanding business to new customers and market segments with off-the-shelf technologies. 3. Continue to enhance the competitive advantages of TSMC’s platforms in mobile, high-performance computing, automotive electronics, and IoT design ecosystems so as to expand TSMC’s dedicated foundry services in these product applications. 4. Further expand TSMC’s business and service infrastructure into emerging and developing markets. ● Long-Term Semiconductor Business Development Plan 1. Continue developing leading-edge technologies at a pace consistent with Moore’s Law. 2. Broaden specialty business contributions by further developing derivative technologies. 3. Provide more integrated services, covering system-level integration design, design technology definition, design tool preparation, wafer processing, and backend services, all of which deliver more value to customers through optimized solutions. 014 040605-2017-年報彩頁-英-CC2018.indd 014-015 040605-2017-年報彩頁-英-CC2018.indd 014-015 015 2018/4/25 上午11:48 2018/4/25 上午11:48 2.3 Organization 2.3.1 Organization Chart Audit Committee Compensation Committee Shareholders’ Meeting Board of Directors, Chairman, Vice Chairman As of 02/28/2018 Internal Audit Co-CEO Office Finance and Spokesperson Legal Operations, Research and Development, Asia, Europe, North America, Business Development, Corporate Planning Organization, Quality and Reliability, Information Technology, Materials Management and Risk Management, Customer Service, Human Resources 2.3.2 Major Corporate Functions Operations ● Operations including all fabs in Taiwan and overseas; product development, manufacturing technology development, and backend technology development, production and service integrations Information Technology ● Integration of the Company’s technology and business IT systems; infrastructure development, communication services and assurance of IT security and service quality, enable organizations to apply Big Data and Machine Learning to improve Company’s productivity and accelerate R&D delivery Research and Development ● Advanced and specialty technology development, exploratory research, as well as design and technology platform development Asia ● Sales, market development, field technical support and service for customers in Asia including China, Japan, Korea and Taiwan Europe ● Technical marketing, field technical support and service for customers in Europe North America ● Sales, market development, field technical solutions and business operations for customers in North America Business Development ● Business development for electronic products, identification of new applications, development of markets for specialty technology, exploration and development of new markets, and the strengthening of customer relations, as well as management of the Company’s brand Materials Management and Risk Management ● Procurement, warehousing, import and export, and logistics support; also environmental protection, industrial safety, occupational health, and risk management Customer Service ● Support and service for customers in Asia, Europe, and North America Human Resources ● Human resources management and organizational development, as well as proprietary information protection and physical security management Internal Audit ● Inspection and review of TSMC’s internal control system, its adequacy in design and effectiveness in operation with independent risk assessment to ensure compliance with TSMC’s policies and procedures as well as with external regulations Finance and Spokesperson ● Corporate finance, accounting and corporate communications; the head of the organization also serves as company spokesperson Corporate Planning Organization ● Planning for operational resources, as well as for production and demand; the integration of business processes, corporate pricing, market analysis and forecasting Legal ● Corporate legal affairs including regulatory compliances, commercial transactions, patents and management of other intellectual properties, litigation, etc. Quality and Reliability ● Ensure of the quality and reliability of the Company’s products via resolving reliability issues at new technology development stage, improving and managing of product quality at production stage, providing solutions to resolve customers’ quality related issues and providing services for advanced materials and failure analysis 016 017 2.4 Board Members 2.4.1 Information Regarding Board Members Title/Name Chairman Morris Chang Vice Chairman F.C. Tseng Gender Nationality or Place of Registration Date Elected Term Expires Date First Elected Shares % Shares % Shareholding When Elected Current Shareholding Spouse & Minor Shareholding Male U.S. 06/09/2015 06/08/2018 12/10/1986 125,137,914 0.48% 125,137,914 0.48% Shares 135,217 % 0.00% Male R.O.C. 06/09/2015 06/08/2018 05/13/1997 34,472,675 0.13% 34,472,675 0.13% 132,855 0.00% Selected Education, Past Positions & Current Positions at Non-profit Organizations Bachelor and Master Degrees in Mechanical Engineering, MIT Ph.D. in Electrical Engineering, Stanford University Former Group Vice-President, Texas Instruments Inc. Former President & COO, General Instrument Corp. Former Chairman, Industrial Technology Research Institute, R.O.C. Former CEO, TSMC Member of National Academy of Engineering, U.S. Life Member Emeritus of MIT Corporation Fellow of the Computer History Museum, U.S. Laureate of the Industrial Technology Research Institute, R.O.C. Honorary Chairman, Taiwan Semiconductor Industry Association (TSIA) Bachelor Degree in Electrical Engineering, National Chengkung University Master Degree in Electrical Engineering, National Chiao Tung University Ph.D. in Electrical Engineering, National Chengkung University Honorary Ph.D., National Chiao Tung University Honorary Ph.D., National Tsing Hua University Former President, Vanguard International Semiconductor Corp. Former President, TSMC Former Deputy CEO, TSMC Former Director, National Culture and Arts Foundation, R.O.C. Chairman, TSMC Education and Culture Foundation As of 02/28/2018 Selected Current Positions at TSMC and Other Companies None Chairman of: - TSMC China Company Ltd. (a privately held company) - Global UniChip Corp. Vice Chairman, Vanguard International Semiconductor Corp. Independent Director, Chairman of Audit Committee & Compensation Committee member, Acer Inc. Director National Development Fund, Executive Yuan (Note 1) Representative: Mei-ling Chen Female R.O.C. 06/09/2015 06/08/2018 12/10/1986 1,653,709,980 6.38% 1,653,709,980 6.38% 11/07/2017 (Note 2) - - - - - - - LL.B., National Chengchi University LL.M., National Taiwan University LL.D., National Chengchi University None Former Director General, Department of Legal Affairs, Ministry of Justice, R.O.C. Former Chairperson of Legal Affairs Committee & concurrently Chairperson of Petitions and Appeals Committee, Executive Yuan, R.O.C. Former Deputy Secretary-General, Executive Yuan, R.O.C. Former Secretary-General, Tainan City Government, R.O.C. Former Secretary-General, Executive Yuan, R.O.C. Former Associate Professor, Department of Law, Chinese Culture University Minister without Portfolio, Executive Yuan & concurrently Minister, National Development Council, R.O.C. - Bachelor Degree in Electrical Engineering, National Taiwan University Master Degree and Ph.D. in Electrical Engineering & Computer Science, University of California, Berkeley President and Co-CEO, TSMC Former President, Worldwide Semiconductor Manufacturing Corp. Former Senior Vice President, Advanced Technology Business, TSMC Former Senior Vice President, Operations, TSMC Former Executive Vice President and Co-Chief Operating Officer, TSMC Director Mark Liu (Note 3) Director C.C. Wei (Note 3) Independent Director Sir Peter L. Bonfield 018 Male U.S. 06/08/2017 06/08/2018 06/08/2017 12,977,114 0.05% 12,913,114 0.05% Male R.O.C. 06/08/2017 06/08/2018 06/08/2017 7,179,207 0.03% 7,179,207 0.03% 261 0.00% Bachelor and Master Degrees in Electrical Engineering, National Chiao Tung University Ph.D. in Electrical Engineering, Yale University President and Co-CEO, TSMC Chairman, TSMC Nanjing Company Ltd. (a privately held company) Male UK 06/09/2015 06/08/2018 05/07/2002 - - - - Former Senior Vice President, Chartered Semiconductor Manufacturing Ltd. Former Senior Vice President, Mainstream Technology Business, TSMC Former Senior Vice President, Business Development, TSMC Former Executive Vice President and Co-Chief Operating Officer, TSMC Chairman, Taiwan Semiconductor Industry Association (TSIA) Director, TSMC Charity Foundation - - Bachelor Degree in Engineering, Loughborough University Honours Degree in Engineering, Loughborough University Former Chairman and CEO, ICL Plc Former CEO and Chairman of the Executive Committee, British Telecommunications Plc Former Vice President, the British Quality Foundation Former Director, Mentor Graphics Corp., U.S. Former Director, Sony Corp., Japan Former Senior Advisor to G3 Good Governance Group, London Fellow of the Royal Academy of Engineering Chair of Council and Senior Pro-Chancellor, Loughborough University, UK Chairman of: - NXP Semiconductors N.V., the Netherlands - GlobalLogic Inc., U.S. (a privately held company) Member, The Longreach Group Advisory Board, HK Board Mentor, CMi, UK Senior Advisor to : - Alix Partners, London - Hampton Group, London (Continued) 019 Title/Name Independent Director Stan Shih Gender Nationality or Place of Registration Date Elected Term Expires Date First Elected Shares % Shares % Shareholding When Elected Current Shareholding Spouse & Minor Shareholding Male R.O.C. 06/09/2015 06/08/2018 04/14/2000 1,480,286 0.01% 1,480,286 0.01% Independent Director Thomas J. Engibous Male U.S. 06/09/2015 06/08/2018 06/10/2009 Independent Director Kok-Choo Chen Female R.O.C. 06/09/2015 06/08/2018 06/09/2011 - - - - - - - - Shares % 16,116 0.00% Selected Education, Past Positions & Current Positions at Non-profit Organizations BSEE & MSEE, National Chiao Tung University Honorary EE Ph.D., National Chiao Tung University Honorary Doctor of Technology, The Hong Kong Polytechnic University Honorary Fellowship, University of Wales, Cardiff, UK Honorary Doctor of International Law, Thunderbird, American Graduate School of International Management, U.S. Co-Founder, Chairman Emeritus, Acer Group Former Chairman & CEO, Acer Group Former Director, Qisda Corp. Former Chairman, National Culture and Arts Foundation, R.O.C. Director, Public Television Service Foundation, R.O.C. Council member of Asian Corporate Governance Associate (ACGA) Chairman of Stan Shih Foundation - - Bachelor and Master Degrees in Electrical Engineering, Purdue University Honorary Doctorate in Engineering, Purdue University Former Executive Vice President and President of the Semiconductor Group, Texas Instruments Inc. Former President and CEO, Texas Instruments Inc. Former Chairman of the Board, Texas Instruments Inc. Former Chairman of the Board of Catalyst Former Chairman of the Board of J. C. Penney Company, Inc. Former Lead Director, J. C. Penney Company, Inc. Member of National Academy of Engineering, U.S. Member of Texas Business Hall of Fame Honorary Director of Catalyst Honorary Trustee, Southwestern Medical Foundation 5,120 0.00% Inns of Court School of Law, England Barrister-at-law, England Advocate & Solicitor, Singapore Attorney-at-law, California, U.S. Lawyer, Tan, Rajah & Cheah, Singapore, 1969-1970 Lawyer, Sullivan & Cromwell, New York, U.S., 1971-1974 Lawyer, Heller, Erhman, White & McAuliffe, San Francisco, California, U.S., 1974-1975 Partner, Ding & Ding Law Offices, Taiwan, 1975-1988 Partner, Chen & Associates Law Offices, Taiwan, 1988-1992 Vice-President, Echo Publishing, Taiwan, 1992-1995 President, National Culture and Arts Foundation, R.O.C., 1995-1997 Senior Vice-President & General Counsel, TSMC, 1997-2001 Founder & Executive Director of Taipei Story House, 2003-2015 Advisor, Executive Yuan, R.O.C., 2009-2016 Director, National Culture and Arts Foundation, R.O.C., 2011-2016 Chairman, National Performing Arts Center, 2014-January 2017 Lecturer, Nanyang University, Singapore, 1970-1971 Associate Professor, Soochow University, 1981-1998 Chair Professor, National Tsing Hua University, 1999-2002 Professor, National Chengchi University, 2001-2004 Professor, Soochow University, 2001-2008 Founder and Executive Director, Museum207 (located in Taipei) Director, Republic of China Female Cancer Foundation Selected Current Positions at TSMC and Other Companies Director & Honorary Chairman, Acer Inc. Director of: - Wistron Corp. - Nan Shan Life Insurance Co., Ltd. - Egis Technology Inc. - Digitimes Inc. (a privately held company) - Chinese Television System Inc. None None Chairman of the Board, NASDAQ, Inc. Director of: - Pica8, Inc. (a privately held company) - Meyer Burger Technology Ltd. General Partner, WISC Partners LP Independent Director Michael R. Splinter Male U.S. 06/09/2015 06/08/2018 06/09/2015 - - - - - - Bachelor and Master Degrees in Electrical Engineering, University of Wisconsin Madison Honorary Ph.D in Engineering, University of Wisconsin Madison Former Executive Vice President of Technology and Manufacturing group, Intel Corp. Former Executive Vice President of Sales and Marketing, Intel Corp. Former CEO, Applied Materials, Inc. Former Chairman, Applied Materials, Inc. Former Director, The NASDAQ OMX Group, Inc. Former Director, Silicon Valley Leadership Group Former Director, Semiconductor Equipment and Materials International (SEMI) Director, University of Wisconsin Foundation Remarks: 1. No member of the Board of Directors held TSMC shares by nominee arrangement. 2. No member of the Board of Directors had a spouse or relative within two degrees of consanguinity serving as a manager or director at TSMC. Note 1: Major Shareholder of TSMC’s Director that is an Institutional Shareholder. Director that is an Institutional Shareholder of TSMC National Development Fund, Executive Yuan Top 10 Shareholders Not Applicable Major Institutional shareholders of National Development Fund: Not Applicable. Note 2: Ms. Mei-ling Chen replaced Mr. Johnsee Lee on November 7, 2017 as the representative of National Development Fund. Note 3: Dr. Mark Liu and Dr. C.C. Wei were elected as TSMC’s directors at the Annual Shareholders’ Meeting on June 8, 2017. 020 021 2.4.2 Remuneration Paid to Directors (Note 1) Unit: NT$ Title/Name Chairman Morris Chang Vice Chairman F.C. Tseng Director National Development Fund, Executive Yuan (Note 2) Representative: Mei-ling Chen Director Mark Liu (Note 3) Director C.C. Wei (Note 3) Independent Director Sir Peter L. Bonfield Independent Director Stan Shih Independent Director Thomas J. Engibous Independent Director Kok-Choo Chen Independent Director Michael R. Splinter Total Director’s Remuneration Base Compensation (A) Severance Pay and Pensions (B) (Note 4) Compensation to Directors (C) Allowances (D) (Note 5) Total Remuneration (A+B+C+D) as a % of 2017 Net Income Compensation Earned by a Director Who is an Employee of TSMC or of TSMC’s Consolidated Entities Base Compensation, Bonuses, and Allowances (E) (Note 5) Severance Pay and Pensions (F)(Note 4) Employees’ Profit Sharing Bonus (G) Total Compensation (A+B+C+D+E+F+G) as a % of 2017 Net Income (Note 6) From TSMC From All Consolidated Entities From TSMC From All Consolidated Entities From TSMC From All Consolidated Entities From TSMC From All Consolidated Entities From TSMC From All Consolidated Entities From TSMC From All Consolidated Entities From TSMC From All Consolidated Entities From TSMC From All Consolidated Entities Cash Stock (Fair Market Value) Cash Stock (Fair Market Value) From TSMC From All Consolidated Entities Compensation Paid to Directors from Non-consolidated Affiliates 23,006,760 23,006,760 506,504 506,504 281,884,700 281,884,700 4,084,839 4,084,839 0.0901% 0.0901% 12,972,120 12,972,120 285,586 285,586 9,600,000 9,600,000 2,647,286 2,647,286 0.0074% 0.0074% - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 9,600,000 9,600,000 - - - - 14,611,560 14,611,560 12,000,000 12,000,000 14,611,560 14,611,560 12,000,000 12,000,000 14,611,560 14,611,560 - - - - - - - - - - - - - - - - 0.0028% 0.0028% - - - - 0.0043% 0.0043% 0.0035% 0.0035% 0.0043% 0.0043% 0.0035% 0.0035% 0.0043% 0.0043% - - - - - - - - - - - - - - - 111,393,154 111,393,154 215,251 215,251 99,883,980 111,547,115 111,547,115 215,251 215,251 99,883,980 - - - - - - - - - - - - - - - - - - - - - - - - - 35,978,880 35,978,880 792,090 792,090 368,919,380 368,919,380 6,732,125 6,732,125 0.1202% 0.1202% 222,940,269 222,940,269 430,502 430,502 199,767,960 - - - - - - - - - - - - - - 99,883,980 99,883,980 - - - - - 199,767,960 - - - - - - - - - - - 0.0901% 0.0901% - 0.0074% 0.0074% 6,381,650 0.0028% 0.0028% 0.0616% 0.0616% 0.0617% 0.0617% 0.0043% 0.0043% 0.0035% 0.0035% 0.0043% 0.0043% 0.0035% 0.0035% 0.0043% 0.0043% - - - - - - - - 0.2435% 0.2435% 6,381,650 *Other than disclosure in the above table, Directors remunerations earned by providing services (e.g. providing consulting services as a non-employee) to TSMC and all consolidated entities in the 2017 financial statements: None. Note 1: Remuneration policies, standards/packages, procedures, the linkage to operating performance and future risk exposure: The base compensation for the Chairman, Vice-Chairman and directors are determined in accordance with the procedures set forth in TSMC’s Articles of Incorporation. The Articles of Incorporation also provides that the compensation to directors shall be no more than 0.3% of annual profits and directors who also serve as executive officers of TSMC are not entitled to receive compensation to directors. The distribution of compensation to directors shall be made in accordance with TSMC’s “Rules for Distribution of Compensation to Directors”. Note 2: Ms. Mei-ling Chen replaced Mr. Johnsee Lee on November 7, 2017 as the representative of National Development Fund. Note 3: Dr. Mark Liu and Dr. C.C. Wei were elected as TSMC's directors at the Annual Shareholders’ Meeting on June 8, 2017. They also serve as executive officers of TSMC, therefore are not entitled to receive compensation to directors. Note 4: Pensions funded/paid according to applicable law. Note 5: The above-mentioned figures include expenses for Company cars and gasoline reimbursement, but do not include compensation paid to Company drivers (totaled NT$6,640,379). Note 6: Total remuneration paid to the directors from TSMC and from all consolidated entities in 2016 both were NT$415,976,199, accounting for 0.1244% of 2016 net income. 022 023 2.5 Management Team 2.5.1 Information Regarding Management Team Title Name Gender Nationality On-board Date (Note 1) Shareholding Spouse & Minor TSMC Shareholding by Nominee Arrangement (Shares) Education and Selected Past Positions Selected Current Positions at Other Companies President and Co-Chief Executive Officer Mark Liu Male U.S. 11/15/1993 12,913,114 0.05% Shares % Shares - % - President and Co-Chief Executive Officer C.C. Wei Male R.O.C. 02/01/1998 7,179,207 0.03% 261 0.00% Senior Vice President and Chief Information Officer Information Technology, Materials Management and Risk Management Stephen T. Tso (Note 2) Senior Vice President, Chief Financial Officer/Spokesperson Finance Lora Ho Senior Vice President Research and Development/Technology Development Wei-Jen Lo Senior Vice President/ Chief Executive Officer of TSMC North America Rick Cassidy Senior Vice President Operations/Product Development Y.P. Chin Senior Vice President Research and Development/Technology Development Y.J. Mii Vice President Operations/Affiliate Fabs M.C. Tzeng Vice President and Chief Technology Officer Research and Development/Corporate Research Jack Sun Vice President Quality and Reliability N.S. Tsai Vice President Operations/Mainstream Fabs and Manufacturing Technology J.K. Lin (Note 3) Vice President Operations/300mm Fabs J.K. Wang Vice President Corporate Planning Organization Irene Sun Male R.O.C. 12/16/1996 12,222,064 0.05% - - Female R.O.C. 06/01/1999 4,481,080 0.02% 2,230,268 0.01% Male R.O.C. 07/01/2004 1,444,127 0.01% Male U.S. 11/14/1997 - - - - - - Male R.O.C. 01/01/1987 6,922,122 0.03% 2,193,107 0.01% Male R.O.C. 11/14/1994 1,000,419 0.00% Male R.O.C. 01/01/1987 7,145,595 0.03% Male R.O.C. 06/02/1997 3,913,831 0.02% - - - - - - Male R.O.C. 03/01/2000 1,961,180 0.01% 1,103,253 0.00% Male R.O.C. 01/01/1987 12,518,018 0.05% 1,073,387 0.00% Male R.O.C. 02/11/1987 2,553,947 0.01% 160,844 0.00% Female R.O.C. 10/01/2003 420,709 0.00% - - Shares - - - - - - - - - - - - - - % - - - - - - - - - - - - - - 024 As of 02/28/2018 Managers Who are Spouses or within Second-degree Relative of Consanguinity to Each Other Title None Name None Relation None Ph.D., Electrical Engineering & Computer Science, University of California, Berkeley, U.S. Executive Vice President and Co-Chief Operating Officer, TSMC Senior Vice President, Operations, TSMC Senior Vice President, Advanced Technology Business, TSMC President, Worldwide Semiconductor Manufacturing Corp. None Ph.D., Electrical Engineering, Yale University, U.S. Executive Vice President and Co-Chief Operating Officer, TSMC Senior Vice President, Business Development, TSMC Senior Vice President, Mainstream Technology Business, TSMC Senior Vice President, Chartered Semiconductor Manufacturing Ltd. Ph.D., Materials Science & Engineering, University of California, Berkeley, U.S. President, WaferTech, LLC Senior Vice President, Operations, TSMC General Manager of CVD Products, Applied Material Director, TSMC subsidiary None None None Director, TSMC subsidiary None None None Master, Business Administration, National Taiwan University, Taiwan Senior Director, Accounting, TSMC Vice President & CFO, TI-Acer Semiconductor Manufacturing Corp. Director and/or Supervisor, TSMC subsidiaries Director, TSMC affiliates President, TSMC subsidiaries None None None None None None None Director, TSMC subsidiary None None None None None None None None Director Wayne Yeh Brother in law Director, TSMC subsidiaries Director, TSMC affiliate Deputy Director M.J. Tzeng Siblings Ph.D., Solid State Physics and Surface Chemistry, University of California, Berkeley, U.S. Vice President, Research and Development, TSMC Vice President, Manufacturing Technology Operations, TSMC Vice President, Advanced Technology Business, TSMC Vice President, Operation II, TSMC Director, Advanced Technology Development and CTM Plant Manager, Intel Corp. Bachelor, Engineering Technology, United States Military Academy at West Point, U.S. President of TSMC North America Vice President of TSMC North America Account Management Master, Electrical Engineering, National Cheng Kung University, Taiwan Vice President, Product Development Operations, TSMC Vice President, Advanced Technology and Business, TSMC Senior Director, Product Engineering & Services, TSMC Ph.D., Electrical Engineering, University of California, Los Angeles, U.S. Vice President, Technology Development, TSMC TSMCSenior Director, R&D Platform I Division, TSMC Master, Applied Chemistry, Chungyuan University, Taiwan Vice President, Mainstream Technology Business, TSMC Vice President, Operation I, TSMC Senior Director, Fab 2 Operations, TSMC Ph.D., Electrical Engineering, University of Illinois at Urbana-Champaign, U.S. Vice President, Research and Development, TSMC Senior Director, Logic Technology Division, TSMC Senior Manager of R&D, International Business Machines (IBM) Ph.D., Material Science, Massachusetts Institute of Technology, U.S. Senior Director, Assembly Test Technology & Service, TSMC Vice President, Operations, Vanguard International Semiconductor Corp. None None Bachelor, Science, National Changhua University of Education, Taiwan Senior Director, Mainstream Fabs, TSMC Director, TSMC subsidiary Director, TSMC affiliate Master, Chemical Engineering, National Cheng Kung University, Taiwan Senior Director, 300mm fabs Operations, TSMC Director, TSMC subsidiary Ph.D., Materials Science and Engineering, Cornell University, U.S. Senior Director, Corporate Planning Organization, TSMC None None None None None None None None None None None None None None None None (Continued) 025 Title Name Gender Nationality On-board Date (Note 1) Shareholding Spouse & Minor TSMC Shareholding by Nominee Arrangement (Shares) Vice President Research and Development/Design and Technology Platform Cliff Hou Vice President Business Development Been-Jon Woo Vice President and General Counsel Legal Sylvia Fang Vice President Human Resources Connie Ma Vice President Research and Development/Technology Development Y.L. Wang Vice President Research and Development/Integrated Interconnect & Packaging Doug Yu Vice President and TSMC Fellow Research and Development/More-than-Moore Technologies Alexander Kalnitsky Vice President Business Development Kevin Zhang Vice President and TSMC Fellow Operations/300mm Fabs/Fab 12B T.S. Chang (Note 4) Vice President Research and Development/Technology Development/ N3 Platform Development Division Michael Wu (Note 4) Vice President Research and Development/Technology Development/ Pathfinding Min Cao (Note 4) Shares % Shares % Shares Male R.O.C. 12/15/1997 352,532 0.00% 60,802 0.00% Female R.O.C. 04/30/2009 320,000 0.00% 53,000 0.00% - - % - - Female R.O.C. 03/20/1995 700,285 0.00% 419,112 0.00% 34,000 0.00% Female R.O.C. 06/01/2014 80,000 0.00% - - Male R.O.C 06/01/1992 218,535 0.00% 1,135,529 0.00% Male R.O.C. 12/28/1994 225,000 0.00% Male U.S. 06/15/2009 Male U.S. 11/01/2016 - - - - Male R.O.C. 02/06/1995 200,781 0.00% - - - - - - - - Male R.O.C. 12/09/1996 468,501 0.00% 176,943 0.00% Male U.S. 07/29/2002 353,152 0.00% 4,470 0.00% - - - - - - - - - - - - - - - - Note 1: On-board date means the official date joining TSMC. Note 2: Senior Vice President and Chief Information Officer Dr. Stephen T. Tso retired, effective March 1, 2018. Note 3: Vice President Mr. J.K. Lin also serves as the head of Materials Management and Risk Management Organization, effective March 1, 2018. Note 4: Dr. T.S. Chang, Dr. Michael Wu and Dr. Min Cao were promoted to Vice President, effective February 13, 2018. Education and Selected Past Positions Ph.D., Electrical Engineering, Syracuse University, U.S. Senior Director, Design and Technology Platform, TSMC Ph.D., Chemistry, University of Southern California, U.S. Director of Business Development, TSMC Vice President of R&D, Grace Semiconductor Manufacturing Corp. Director of Technology Integration, Intel Corp. Master of Comparative Law, School of Law, University of Iowa Attorney-at-law, Taiwan Associate General Counsel, TSMC Senior Associate, Taiwan International Patent and Law Office (TIPLO) EMBA, International Business Management, National Taiwan University Director of Human Resources, TSMC Senior Vice President of Global Human Resources, Trend Micro Inc. Ph.D., Electrical Engineering, National Chiao Tung University, Taiwan Vice President, Fab 14B Operations, TSMC Senior Director, Fab 14B Operations, TSMC Ph.D., Materials Engineering, Georgia Institute of Technology, U.S. Senior Director of Integrated Interconnect & Packaging Division in R&D, TSMC Ph.D., Electrical Engineering, Carleton University, Canada Senior Director of More-than-Moore Technologies Division in R&D, TSMC Ph.D., Electrical Engineering, Duke University, U.S. Vice President, Design and Technology Platform, TSMC Vice President, Technology and Manufacturing Group, Intel Corp. Ph.D., Electrical Engineering, National Tsing Hua University Senior Director, Fab 12B Operations, TSMC Ph.D., Electrical Engineering, University of Wisconsin-Madison, U.S. Senior Director of N3 Platform Development Division in R&D, TSMC Ph.D., Physics, Stanford University, U.S. Senior Director of Pathfinding Division in R&D, TSMC Selected Current Positions at Other Companies Director, TSMC subsidiaries Director, TSMC affiliate President, TSMC subsidiaries Managers Who are Spouses or within Second-degree Relative of Consanguinity to Each Other Title None Name None Relation None None None None None Director and/or Supervisor, TSMC subsidiaries None None None None None None None None None None None None None None None None None None None None None None None None None None None None None None None None None None None 026 027 2.5.2 Compensation Paid to President & Co-CEO and Vice Presidents (Note 1) Salary (A) Severance Pay and Pensions (B) (Note 5) From TSMC 8,371,830 8,371,830 5,384,970 From All Consolidated Entities 8,371,830 8,371,830 5,384,970 From TSMC 215,251 215,251 138,456 From All Consolidated Entities 215,251 215,251 138,456 Bonuses and Allowances (C) (Note 6) From TSMC From All Consolidated Entities Employees’ Profit Sharing Bonus (D) From TSMC From All Consolidated Entities Cash Stock (Fair Market Value) Cash Stock (Fair Market Value) 103,021,324 103,021,324 103,175,285 103,175,285 46,020,375 46,020,375 99,883,980 99,883,980 44,099,530 - - - 99,883,980 99,883,980 44,099,530 - - - Total Compensation (A+B+C+D) as a % of 2017 Net Income (Note 7) From TSMC 0.0616% 0.0617% 0.0279% From All Consolidated Entities 0.0616% 0.0617% 0.0279% Compensation Received from Non-consolidated Affiliates - - - 78,328,182 92,249,546 2,013,760 2,365,597 549,707,037 634,894,097 504,799,711 - 504,799,711 - 0.3308% 0.3597% 120,000 Unit: NT$ Title President and Co-Chief Executive Officer President and Co-Chief Executive Officer Senior Vice President, Chief Financial Officer/Spokesperson Finance Senior Vice President and Chief Information Officer Information Technology, Materials Management and Risk Management Senior Vice President Research and Development/Technology Development Senior Vice President/ Chief Executive Officer of TSMC North America Senior Vice President Operations/Product Development Senior Vice President Research and Development/Technology Development Vice President Operations/Affiliate Fabs Vice President and Chief Technology Officer Research and Development/Corporate Research Vice President Quality and Reliability Name Mark Liu C.C. Wei Lora Ho Stephen T. Tso (Note 2) Wei-Jen Lo Rick Cassidy Y.P. Chin Y.J. Mii M.C. Tzeng Jack Sun N.S. Tsai Vice President Operations/Mainstream Fabs and Manufacturing Technology J.K. Lin (Note 3) Vice President Operations/300mm Fabs Vice President Corporate Planning Organization Vice President Research and Development/Design and Technology Platform Vice President Business Development Vice President and General Counsel Legal Vice President Human Resources Vice President Research and Development/Technology Development Vice President Research and Development/Integrated Interconnect & Packaging Vice President and TSMC Fellow Research and Development/More-than-Moore Technologies Vice President Business Development Vice President and TSMC Fellow Operations/300mm Fabs/Fab 12B Vice President Research and Development/Technology Development/N3 Platform Development Division J.K. Wang Irene Sun Cliff Hou Been-Jon Woo Sylvia Fang Connie Ma Y.L. Wang Doug Yu Alexander Kalnitsky Kevin Zhang T.S. Chang (Note 4) Michael Wu (Note 4) Vice President Research and Development/Technology Development/Pathfinding Min Cao (Note 4) Total 100,456,812 114,378,176 2,582,718 2,934,555 801,924,021 887,111,081 748,667,201 - 748,667,201 - 0.4820% 0.5109% 120,000 Note 1: Compensation policy, standards/packages, procedures, the linkage to operating performance and future risk exposure: The total compensation paid to the President and Co-Chief Executive Officer, Chief Financial Officer and General Counsel is proposed by Chairman based on their job responsibility, contribution, company performance and projected future risks the Company will face. The total compensation paid to other executive officers is proposed by Chairman and the President and Co-Chief Executive Officer. The proposals are reviewed by the Compensation Committee before submitted to the Board of Directors for final approval. Note 2: Senior Vice President and Chief Information Officer Dr. Stephen T. Tso retired, effective March 1, 2018. Note 3: Vice President Mr. J.K. Lin also serves as the head of Materials Management and Risk Management Organization, effective March 1, 2018. Note 4: Dr. T.S. Chang, Dr. Michael Wu and Dr. Min Cao were promoted to Vice President, effective February 13, 2018. Therefore, their 2017 compensation data is not disclosed. Note 5: Pensions funded/paid according to applicable law. Note 6: The above-mentioned figures include the expense for the employees’ cash bonuses distributed in May, August, November 2017 and February 2018, Company cars and gasoline reimbursement, but does not include compensation paid to Company drivers (totaled NT$3,455,753). Note 7: Total compensation paid to the executive officers in 2016 from TSMC was NT$1,506,047,477, accounting for 0.451% of 2016 net income. Total compensation paid to the executive officers in 2016 from all consolidated entities was NT$1,603,740,033, accounting for 0.480% of 2016 net income. Compensation Paid to President & Co-CEO and Vice Presidents NT$0 ~ NT$2,000,000 NT$2,000,000 ~ NT$4,999,999 NT$5,000,000 ~ NT$9,999,999 NT$10,000,000 ~ NT$14,999,999 NT$15,000,000 ~ NT$29,999,999 From TSMC Rick Cassidy None None None None 2017 From All Consolidated Entities and Non-consolidated Affiliates None None None None None NT$30,000,000 ~ NT$49,999,999 Irene Sun, Been-Jon Woo, Sylvia Fang, Connie Ma, Y.L. Wang, Doug Yu Irene Sun, Been-Jon Woo, Sylvia Fang, Connie Ma, Y.L. Wang, Doug Yu NT$50,000,000 ~ NT$99,999,999 Lora Ho, Y.P. Chin, Y.J. Mii, M.C. Tzeng, Jack Sun, N.S. Tsai, J.K. Lin, J.K. Wang, Cliff Hou, Alexander Kalnitsky, Kevin Zhang Lora Ho, Rick Cassidy, Y.P. Chin, Y.J. Mii, M.C. Tzeng, Jack Sun, N.S. Tsai, J.K. Lin, J.K. Wang, Cliff Hou, Alexander Kalnitsky, Kevin Zhang Over NT$100,000,000 Total Mark Liu, C.C. Wei, Stephen T. Tso, Wei-Jen Lo Mark Liu, C.C. Wei, Stephen T. Tso, Wei-Jen Lo 22 22 028 029 2.5.3 Employees’ Profit Sharing Bonus Paid to Management Team Unit: NT$ Title President and Co-Chief Executive Officer President and Co-Chief Executive Officer Senior Vice President, Chief Financial Officer/Spokesperson Finance Senior Vice President and Chief Information Officer Information Technology, Materials Management and Risk Management Senior Vice President Research and Development/Technology Development Senior Vice President/ Chief Executive Officer of TSMC North America Senior Vice President Operations/Product Development Senior Vice President Research and Development/Technology Development Vice President Operations/Affiliate Fabs Vice President and Chief Technology Officer Research and Development/Corporate Research Vice President Quality and Reliability Vice President Operations/Mainstream Fabs and Manufacturing Technology Vice President Operations/300mm Fabs Vice President Corporate Planning Organization Vice President Research and Development/Design and Technology Platform Vice President Business Development Vice President and General Counsel Legal Vice President Human Resources Vice President Research and Development/Technology Development Vice President Research and Development/Integrated Interconnect & Packaging Vice President and TSMC Fellow Research and Development/More-than-Moore Technologies Vice President Business Development Vice President and TSMC Fellow Operations/300mm Fabs/Fab 12B Vice President Research and Development/Technology Development/N3 Platform Development Division Vice President Research and Development/Technology Development/Pathfinding Total Name Mark Liu C.C. Wei Lora Ho Stephen T. Tso (Note 1) Wei-Jen Lo Rick Cassidy Y.P. Chin Y.J. Mii M.C. Tzeng Jack Sun N.S. Tsai J.K. Lin (Note 2) J.K. Wang Irene Sun Cliff Hou Been-Jon Woo Sylvia Fang Connie Ma Y.L. Wang Doug Yu Alexander Kalnitsky Kevin Zhang T.S. Chang (Note 3) Michael Wu (Note 3) Min Cao (Note 3) Note 1: Senior Vice President and Chief Information Officer Dr. Stephen T. Tso retired, effective March 1, 2018. Note 2: Vice President Mr. J.K. Lin also serves as the head of Materials Management and Risk Management Organization, effective March 1, 2018. Note 3: Dr. T.S. Chang, Dr. Michael Wu and Dr. Min Cao were promoted to Vice President, effective February 13, 2018. Therefore, their 2017 compensation data is not disclosed. Stock (Fair Market Value) Cash Total Employees’ Profit Sharing Bonus Total Employees’ Profit Sharing Bonus Paid to Management Team as a % of 2017 Net Income - - - - - 99,883,980 99,883,980 44,099,530 99,883,980 99,883,980 44,099,530 0.0291% 0.0291% 0.0129% 504,799,711 504,799,711 0.1471% 748,667,201 748,667,201 0.2182% 030 031 032 032 033 033 3. Corporate Governance 3.1 Overview TSMC advocates and acts upon the principles of operational transparency and respect for shareholder rights. We believe that the basis for successful corporate governance is a sound and effective Board of Directors. In line with this principle, the TSMC Board delegates various responsibilities and authority to two Board Committees, Audit Committee and Compensation Committee. Each Committee has a written charter approved by the Board. Each Committee’s chairperson regularly reports to the Board on the activities and actions of the relevant committee. The Audit Committee and Compensation Committee consist solely of independent directors. 2017 Corporate Governance Awards Organization Dow Jones Sustainability Indices (DJSI) MSCI ESG Indexes FTSE4Good Index IR Magazine FORTUNE Institutional Investor Forbes Taiwan Institute of Sustainable Energy Awards Membership in the Dow Jones Sustainability World Index for the 17th consecutive year RobecoSAM Sustainability Award - Gold Class Selected as MSCI ACWI ESG Leaders Index component Selected as MSCI ACWI SRI Index component Selected as FTSE4Good Emerging Index component Global Top 50 Gold – best investor relations Selected as one of The World’s Most Admired Companies Selected as one of the Most Honored Company (Greater China) Chairman Dr. Morris Chang was selected as one of the World’s 100 Greatest Living Business Minds Taiwan Corporate Sustainability Awards: Chairman Dr. Morris Chang received TSCA Honorary Award The Most Prestigious Sustainability Awards - Top 10 Domestic Corporates Top 50 Corporate Sustainability Report Awards - Electronics Industry Circular Economy Leadership Awards Taiwan Stock Exchange Ranked in top 5% in Corporate Governance Evaluation of Listed Companies for the 3rd consecutive year 3.2 Board of Directors Board Structure TSMC’s Board of Directors consists of ten distinguished members with a great breadth of experience as world-class business leaders or professionals. We rely on them for their diverse knowledge, personal perspectives, and solid business judgment. Five of the ten members are independent directors: former British Telecommunications Chief Executive Officer, Sir Peter L. Bonfield; Co-Founder, Chairman Emeritus of the Acer Group, Mr. Stan Shih; former Texas Instruments Inc. Chairman of the Board, Mr. Thomas J. Engibous; former Chairman of National Performing Arts Center and former Advisor of Executive Yuan, R.O.C., Ms. Kok-Choo Chen; and former Chairman of Applied Materials, Inc., Mr. Michael R. Splinter. The number of Independent Directors is 50% of the total number of Directors. Two of the members of the Board Directors are female. Board Responsibilities Under the leadership of Chairman Morris Chang, TSMC’s Board of Directors takes a serious and forthright approach to its duties and is a dedicated, competent and independent Board. In the spirit of Chairman Chang’s approach to corporate governance, a board of directors’ primary duty is to supervise. The Board should supervise the Company’s: compliance with relevant laws and regulations, financial transparency, timely disclosure of material information, and maintaining of the highest integrity within the Company. TSMC’s Board of Directors strives to perform these responsibilities through the Audit Committee and the Compensation Committee, the hiring of a financial expert consultant for the Audit Committee, and coordination with the Internal Audit department. The second duty of the Board of Directors is to evaluate the management’s performance and to appoint and dismiss officers of the Company when necessary. TSMC’s management has maintained a healthy and functional communication with the Board of Directors, has been devoted in executing guidance of the Board, and is dedicated in running the business operations, all to achieve the best interests for TSMC shareholders. The third duty of the Board of Directors is to resolve the important, concrete matters, such as capital appropriations, investment activities, dividends, etc. The fourth duty of the Board of Directors is to provide guidance to the management team of the Company. Quarterly, TSMC’s management reports to the Board on a variety of subjects. The management also reviews the Company’s business strategies with the Board and updates TSMC’s Board on the progress of those strategies, obtaining Board guidance as appropriate. Selection and Election of Directors TSMC envisions the membership of its esteemed Board of Directors to be composed of highly ethical professionals with the necessary knowledge, experience and understanding from diverse backgrounds. TSMC envisions its Board to be composed of as many independent directors as possible, and the independence of each independent director candidate is also considered and assessed under relevant laws. Based on the above selection criteria, TSMC composes its Board with world-class candidates who are/were international or local business leaders in the high-tech industry, prestigious academics or other professionals excelling in their chosen field of expertise. Directors shall be elected pursuant to the candidates nomination system as specified in Article 192-1 of the R.O.C. “Company Law”. The tenure of office for Directors shall be three years. The independence of each independent director candidate is also considered and assessed under relevant law such as the Taiwan “Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies”. Under R.O.C. law, in which TSMC was incorporated, any shareholders holding one percent or more of our total outstanding common shares may nominate their own candidate to stand for election as a Board member. This democratic mechanism allows our shareholders to become involved in the selection and nomination process of Board candidates. The final slate of candidates are put to the shareholders for voting at the relevant annual shareholders’ meeting. There are no limits on the number of terms that a director may serve. We believe the Company benefits from the contributions of directors who have over their years of dedicated service acquired unique insights into the operations and financial developments of the Company. The Company reviews the appropriateness of each director’s continued service to ensure there are new viewpoints available to the Board. Transition of Responsibilities In October 2017, Dr. Morris Chang, as TSMC Chairman for the last thirty years, announced his plan to retire from the Company immediately after the Annual Shareholders’ Meeting in early June, 2018. All present directors of the board, except himself, have unanimously agreed to be nominated, and if elected, will serve as directors of the board during the next term. They all have agreed to have TSMC under the dual leadership of Dr. Mark Liu and Dr. C.C. Wei, who are TSMC’s presidents and Co-CEOs currently. Dr. Liu will be the Chairman of the Board, and Dr. Wei will be the Chief Executive Officer. Directors’ Compensation According to our Articles of Incorporation, not more than 0.3 percent of our annual profits (defined under local law) after recovering any losses incurred in prior years, if any, may be distributed as compensation to our directors. In addition, directors who also serve as executive officers of the Company are not entitled to receive any director compensation. 034 035 Directors’ Professional Qualifications and Independent Analysis According to the relevant requirements set by Taiwan’s Securities and Futures Bureau, the professional qualifications and independence status of the Company’s Board members are listed in the table below. Meet the Following Professional Qualification Requirements, Together with at Least Five Years Work Experience Criteria (Note) Criteria Name Morris Chang Chairman F.C. Tseng Vice Chairman Mei-ling Chen Director Mark Liu Director C.C. Wei Director Sir Peter L. Bonfield Independent Director Stan Shih Independent Director Thomas J. Engibous Independent Director Kok-Choo Chen Independent Director Michael R. Splinter Independent Director An Instructor or Higher Position in a Department of Commerce, Law, Finance, Accounting, or Other Academic Department Related to the Business Needs of the Company in a Public or Private Junior College, College or University A Judge, Public Prosecutor, Attorney, Certified Public Accountant, or Other Professional or Technical Specialists Who Has Passed a National Examination and Been Awarded a Certificate in a Profession Necessary for the Business of the Company Have Work Experience in the Area of Commerce, Law, Finance, or Accounting, or Otherwise Necessary for the Business of the Company 1 2 3 4 5 6 7 8 9 10 Number of Other Taiwanese Public Companies Concurrently Serving as an Independent Director ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 1 ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 Note: Directors, during the two years before being elected and during the term of office, meet any of the following situations, please tick the appropriate corresponding boxes: 1. Not an employee of the company or any of its affiliates; 2. Not a director or supervisor of the company or any of its affiliates. The same does not apply, however, in cases where the person is an independent director of the company, its parent company, or any subsidiary, as appointed in accordance with the laws of Taiwan or with the laws of the country of the parent company or subsidiary; 3. Not a natural-person shareholder who holds shares, together with those held by the person’s spouse, minor children, or held by the person under others’ names, in an aggregate amount of one percent or more of the total number of issued shares of the company or ranks as one of its top ten shareholders; 4. Not a spouse, relative within the second degree of kinship, or lineal relative within the third degree of kinship, of any of the above persons in the preceding three subparagraphs; 5. Not a director, supervisor, or employee of a corporate/institutional shareholder that directly holds five percent or more of the total number of issued shares of the company or ranks as of its top five shareholders; 6. Not a director, supervisor, officer, or shareholder holding five percent or more of the shares of a specified company or institution that has a financial or business relationship with the company; 7. Not a professional individual who, or an owner, partner, director, supervisor, or officer of a sole proprietorship, partnership, company, or institution that, provides commercial, legal, financial, accounting services or consultation to the company or to any affiliate of the company, or a spouse thereof, provided that this restriction does not apply to any member of the compensation committee who exercises powers pursuant to Article 7 of the “Regulations Governing the Establishment and Exercise of Powers of Compensation Committees of Companies whose Stock is Listed on the TWSE or Traded on the GTSM”; 8. Not having a marital relationship, or a relative within the second degree of kinship to any other director of the company; 9. Not been a person of any conditions defined in Article 30 of the Company Law; and 10. Not a governmental, juridical person or its representative as defined in Article 27 of the Company Law. TSMC’s Audit Committee is empowered by its Charter to conduct any study or investigation it deems appropriate to fulfill its responsibilities. It has direct access to TSMC’s internal auditors, the Company’s independent auditors, and all employees of the Company. The Committee is authorized to retain and oversee special legal, accounting, or other consultants as it deems appropriate to fulfill its mandate. The Audit Committee Charter is available on TSMC’s corporate website. 3.2.2 Compensation Committee The Compensation Committee assists the Board in discharging its responsibilities related to TSMC’s compensation and benefits policies, plans and programs, and in the evaluation and compensation of TSMC’s directors of the Board and executives. The members of the Compensation Committee are appointed by the Board as required by R.O.C. law. According to TSMC’s Compensation Committee Charter, the Committee shall consist of no fewer than three independent directors of the Board. Currently, the Compensation Committee is comprised of all five independent directors; the Chairman of the Board, Dr. Morris Chang, is invited by the Committee to attend all meetings and is excused from the Committee’s discussion of his own compensation. TSMC’s Compensation Committee is authorized by its Charter to retain an independent consultant to assist in the evaluation of CEO, or executive officer compensation. The Compensation Committee Charter is available on TSMC’s corporate website. 3.2.1 Audit Committee The Audit Committee assists the Board in fulfilling its oversight of the quality and integrity of the accounting, auditing, reporting, and financial control practices of the Company. The Audit Committee is responsible to review the following major matters: ● Financial reports; ● Auditing and accounting policies and procedures; ● Internal control systems and including related policies and procedures; ● Material asset or derivatives transactions; ● Material lending funds, endorsements or guarantees; ● Offering or issuance of any equity-type securities; ● Derivatives and cash investments; ● Legal compliance; ● Related-party transactions and potential conflicts of interests involving executive officers and directors; ● Ombudsman reports; ● Fraud prevention and investigation reports; ● IT security; ● Corporate risk management; ● Performance, independence, qualification of independent auditor; ● Hiring or dismissal of an attesting CPA, or the compensation given thereto; ● Appointment or discharge of financial, accounting, or internal auditing officers; ● Assessment of Committee Charter and fulfillment of Audit Committee duties; and ● Assessment of the Committee’s performance, etc. Under R.O.C. law, the membership of Audit Committee shall consist of all independent Directors. TSMC’s Audit Committee satisfies this statutory requirement. The Committee also engaged a financial expert consultant in accordance with the rules of the U.S. Securities and Exchange Commission. The Audit Committee annually conducts self-evaluation to assess the Committee’s performance and identify areas for further attention. 036 037 Compensation Committee Members’ Professional Qualifications and Independent Analysis According to the relevant requirements set by Taiwan’s Securities and Futures Bureau, the professional qualifications and independence status of the Company’s Compensation Committee members are listed in the table below. Meet the Following Professional Qualification Requirements, Together with at Least Five Years Work Experience Criteria (Note) Criteria Name Title Stan Shih Independent Director Sir Peter L. Bonfield Independent Director Thomas J. Engibous Independent Director Kok-Choo Chen Independent Director Michael R. Splinter Independent Director An Instructor or Higher Position in a Department of Commerce, Law, Finance, Accounting, or Other Academic Department Related to the Business Needs of the Company in a Public or Private Junior College, College or University A Judge, Public Prosecutor, Attorney, Certified Public Accountant, or Other Professional or Technical Specialists Who Has Passed a National Examination and Been Awarded a Certificate in a Profession Necessary for the Business of the Company Have Work Experience in the Area of Commerce, Law, Finance, or Accounting, or Otherwise Necessary for the Business of the Company 1 2 3 4 5 6 7 8 Number of Other Taiwanese Public Companies Concurrently Serving as a Compensation Committee Member ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ - - - - - Note: Compensation Committee Members, during the two years before being elected or during the term of office, meet any of the following situations, please tick the appropriate corresponding boxes: 1. Not an employee of the company or any of its affiliates; 2. Not a director or supervisor of the company or any of its affiliates. The same does not apply, however, in cases where the person is an independent director of the company, its parent company, or any subsidiary, as appointed in accordance with the laws of Taiwan or with the laws of the country of the parent company or subsidiary; 3. Not a natural-person shareholder who holds shares, together with those held by the person’s spouse, minor children, or held by the person under others’ names, in an aggregate amount of one percent or more of the total number of issued shares of the company or ranks as one of its top ten shareholders; 4. Not a spouse, relative within the second degree of kinship, or lineal relative within the third degree of kinship, of any of the above persons in the preceding three subparagraphs; 5. Not a director, supervisor, or employee of a corporate/institutional shareholder that directly holds five percent or more of the total number of issued shares of the company or ranks as of its top five shareholders; 6. Not a director, supervisor, officer, or shareholder holding five percent or more of the shares of a specified company or institution that has a financial or business relationship with the company; 7. Not a professional individual who, or an owner, partner, director, supervisor, or officer of a sole proprietorship, partnership, company, or institution that, provides commercial, legal, financial, accounting services or consultation to the company or to any affiliate of the company, or a spouse thereof; 8. Not been a person of any conditions defined in Article 30 of the Company Law. 3.2.3 Director and Committees Members’ Attendance Each Director is expected to attend every Board meeting and the committees meeting on which he or she serves (Note). In 2017, the average Board Meeting attendance rate was 84% and the attendance rate for the Audit Committee and Compensation Committee’s Meetings were 88% and 85% respectively. Board of Directors Meeting Status Dr. Morris Chang, the Chairman of the Board of Directors, convened four regular meetings and one special meeting in 2017. The directors’ attendance status is as follows. Title Chairman Vice Chairman Director Director Director Independent Director Independent Director Independent Director Independent Director Independent Director Name Morris Chang F.C. Tseng National Development Fund, Executive Yuan Representative: Mei-ling Chen Mark Liu C.C. Wei Sir Peter L. Bonfield Stan Shih Thomas J. Engibous Kok-Choo Chen Michael R. Splinter Annotations: A. (1) Securities and Exchange Act §14-3 resolutions: Meeting Dates Resolution Attendance in Person By Proxy Attendance Rate in Person (%) Notes 5 5 3 2 2 4 5 1 5 4 - - 2 - - 1 - 4 - 1 100% None 100% None 60% 100% 100% Ms. Mei-ling Chen replaced Mr. Johnsee Lee as the representative of National Development Fund on November 7, 2017. New office assumed (elected on June 8) New office assumed (elected on June 8) 80% None 100% None 20% None 100% None 80% None Any Independent Director Had a Dissenting Opinion or Qualified Opinion 2017 1st Regular Meeting February 13 & 14 2017 2nd Regular Meeting May 8 & 9 2017 4th Regular Meeting November 13 & 14 approving amendments to TSMC’s “Procedures for Acquisition or Disposal of Assets” None approving amendments to TSMC’s internal control related policies and procedures approving (1) Ms. Shirley Chiang as the new engagement partner of Deloitte & Touche, TSMC’s independent auditor, starting from 2018; and (2) the proposed 2018 service fees and out-of-pocket expenses for independent auditor (2) There were no other written or otherwise recorded resolutions on which an independent director had a dissenting opinion or qualified opinion in 2017. B. Recusals of Directors due to conflicts of interests in 2017: Directors recused themselves from the discussion and voting of their compensation resolution. C. Measures taken to strengthen the functionality of the Board: - Five of the ten Directors are Independent Directors. The number of Independent Directors is 50% of the total number of Directors. The Chairman and Vice Chairman of the Board of Directors are not executive officers of the Company. - TSMC Board delegates various responsibilities and authority to two Board Committees, Audit Committee and Compensation Committee. Both the two Committees consist solely of the five Independent Directors. Each Committees chairperson regularly reports to the Board on the activities and actions of the relevant committee. Note: Mr. Thomas J. Engibous’ attendance rate in 2017 for TSMC’s Board and Committee meetings was affected by a personal medical condition that prevented him from traveling long distances. Mr. Engibous participated in all meetings held via video- or tele-conference. He received updates on important matters considered by the Board at the meetings he was unable to attend, which allowed him to continue providing his insight to the Company throughout the year. We anticipate Mr. Engibous will resume regular participation in Board and Committee meetings upon his recovery. 038 039 Audit Committee Meeting Status Sir Peter L. Bonfield, Chairman of the Audit Committee, convened four regular meetings and one special meeting in 2017. The Committee members and consultant’s attendance status is shown in the following table. In addition to these meetings, the Committee members and Financial Expert Consultant participated in three telephone conferences to discuss the Company’s Annual Report to be filed with the Taiwan and U.S. authorities and investor conference materials with management. Title Name Attendance in Person By Proxy Attendance Rate in Person (%) Telephone Conferences Chair Member Member Member Member Financial Expert Consultant Sir Peter L. Bonfield Stan Shih Thomas J. Engibous Kok-Choo Chen Michael R. Splinter J.C. Lobbezoo Annotations: A. (1) Resolutions related to Securities and Exchange Act §14-5: Meeting Dates Resolution 5 5 2 5 5 5 - - 3 - - - 100% 100% 40% 100% 100% 100% 3 3 3 3 3 3 Attendance Rate of Telephone Conferences (%) Notes 100% None 100% None 100% None 100% None 100% None 100% None Any Independent Director Had a Dissenting Opinion or Qualified Opinion 2017 1st Regular Meeting February 13 2017 2nd Regular Meeting May 8 2017 3rd Regular Meeting August 7 2017 4th Regular Meeting November 13 2018 1st Regular Meeting February 12 ● approving the 2016 annual financial statements ● approving the related party sale of TSMC’s existing equipment to TSMC Nanjing Company Limited ● approving the amendments to TSMC’s “Procedures for Acquisition or Disposal of Assets” ● approving 2016 Statement of Internal Control System None ● approving the proposed additional 2017 service fees to Deloitte & Touche for VisEra Technologies Company Ltd. ● approving amendments to TSMC’s internal control related policies and procedures ● approving the 2017 second quarter financial statements ● approving Ms. Shirley Chiang as the new engagement partner for TSMC starting from 2018 and the proposed 2018 service fees and out-of-pocket expenses for Deloitte & Touche ● approving the 2017 annual financial statements ● approving 2017 Statement of Internal Control System (2) There was no other resolutions which was not approved by the Audit Committee but was approved by two thirds or more of all directors in 2017. B. There were no recusals of independent directors due to conflicts of interests in 2017. C. Descriptions of the communications between the independent directors, the internal auditors, and the independent auditors in 2017 (which should include the material items, channels, and results of the audits on the corporate finance and/or operations, etc.): (1) The internal auditors have sent the audit reports to the members of the Audit Committee periodically, and presented the findings of all audit reports in the quarterly meetings of the Audit Committee. The head of Internal Audit will immediately report to the members of the Audit Committee any material matters. During 2017, the head of Internal Audit did not report any such material matters. The communication channel between the Audit Committee and the internal auditor functioned well. (2) The Company’s independent auditors have presented the findings of their quarterly review or audits on the Company’s financial results. Under applicable laws and regulations, the independent auditors are also required to immediately communicate to the Audit Committee any material matters that they have discovered. During 2017, the Company’s independent auditors did not report any irregularity. The communication channel between the Audit Committee and the independent auditors functioned well. The communications between the independent directors, the internal auditors, and the independent auditors are listed in the table below. Communications between the Independent Directors and the Internal Auditors Communications between the Independent Directors and the Independent Auditors Meeting Dates 2017 1st Regular Meeting February 13 2017 2nd Regular Meeting May 8 2017 3rd Regular Meeting August 7 2017 4th Regular Meeting November 13 ● reviewing the Internal Auditor’s report (closed door) ● reviewing report on SOX 404 self-testing results for the year 2016 ● reviewing and approving 2016 Statement of Internal Control System ● reviewing the Internal Auditor’s report (closed door) ● reviewing and approving amendments to TSMC’s internal control related policies and procedures ● reviewing the Internal Auditor’s report (closed door) ● reviewing the Internal Auditor’s report (closed door) ● reviewing and approving the 2018 internal audit plan 2018 1st Regular Meeting February 12 ● reviewing the Internal Auditor’s report (closed door) ● reviewing report on SOX 404 self-testing results for the year 2017 ● reviewing and approving 2017 Statement of Internal Control System ● reviewing any audit problems or difficulties and management’s response in connection with 2016 annual financial statements (closed door) ● reviewing regulatory developments ● reviewing external auditor relationship (i.e. qualification, performance and independence) ● reviewing any review problems or difficulties and management’s response in connection with 2017 first quarter financial statements (closed door) ● reviewing regulatory developments ● reviewing the result of CPA evaluation questionnaire ● reviewing any review problems or difficulties and management’s response in connection with 2017 second quarter financial statements (closed door) ● reviewing regulatory developments ● reviewing any review problems or difficulties and management’s response in connection with 2017 third quarter financial statements (closed door) ● reviewing regulatory developments ● reviewing Deloitte’s report on its cyber incident ● reviewing report on new GAAP (IFRS 9 & IFRS 15) adoption starting from January 1, 2018 ● reviewing any audit problems or difficulties and management’s response in connection with 2017 annual financial statements (closed door) ● reviewing regulatory developments ● reviewing external auditor relationship (i.e. qualification, performance and independence) ● reviewing report on IFRS 16 adoption status Compensation Committee Meeting Status Mr. Stan Shih, Chairman of the Compensation Committee, convened four regular meetings in 2017. The Committee members’ attendance status is as follows: Title Name Chair Stan Shih Member Sir Peter L. Bonfield Member Thomas J. Engibous Member Kok-Choo Chen Member Michael R. Splinter Attendance in Person By Proxy Attendance Rate in Person (%) Notes 4 4 1 4 4 - - 3 - - 100% None 100% None 25% None 100% None 100% None Annotations: - There was no recommendation of the Compensation Committee which was not adopted or was modified by the Board of Directors in 2017. - There were no written or otherwise recorded resolutions on which a member of the Compensation Committee had a dissenting opinion or qualified opinion. 3.3 Major Decisions of Shareholders’ Meeting and Board Meetings 3.3.1 Major Resolutions of Shareholders’ Meeting and Implementation Status TSMC held 2017 Annual Shareholders’ Meeting in Hsinchu, Taiwan on June 8, 2017. At the meeting, shareholders present in person or by proxy approved the following resolutions: (1) The 2016 Business Report and Financial Statements. Consolidated revenue totaled NT$947.94 billion and net income was NT$334.25 billion, with diluted earnings per share of NT$12.89; (2) The distribution of a NT$7 cash dividend per common share; (3) The revisions to the Articles of Incorporation; (4) The revisions to the Procedures for Acquisition or Disposal of Assets; and (5) Election of two additional Directors. Implementation Status All the resolutions of the Shareholders’ Meeting have been fully implemented in accordance with the resolutions. The two newly elected directors are Dr. Mark Liu and Dr. C.C. Wei. 3.3.2 Major Resolutions of Board Meetings During 2017 and as of the date of this Annual Report, major resolutions approved at Board meetings are summarized below: (1) Board Meeting of February 13 & 14, 2017: ● approving 2016 business report and financial statements; ● approving distribution of 2016 profits, and cash dividends, employee cash bonus and employee profit sharing; ● approving capital appropriation of approximately US$1,927.58 million for purposes including: 1. Upgrading advanced technology capacity and expanding advanced packaging capacity; 2. Conversion of logic capacity to specialty technology; 3. Upgrading and building specialty technology capacity; 4. Second quarter 2017 R&D capital investments and sustaining capital expenditures; ● approving the capital injection of not more than US$2 billion to TSMC Global Ltd., a wholly-owned BVI subsidiary, for the purpose of reducing foreign exchange hedging costs; ● determining the number of directors to be increased by two to ten and approving the election of two additional directors at TSMC’s 2017 Annual Shareholders’ Meeting, and authorizing the Chairman to nominate Dr. Mark Liu and Dr. C.C. Wei as candidates for directors to stand for election at TSMC’s 2017 Annual Shareholders’ Meeting; and ● convening the 2017 Annual Shareholders’ Meeting. (2) Special Board Meeting of April 26, 2017: ● approving the nomination of Dr. Mark Liu and Dr. C.C. Wei as candidates to stand for election as two additional directors at TSMC’s Shareholders’ Meeting on June 8, 2017. (3) Regular Board Meeting of May 8 & 9, 2017: ● approving capital appropriations of approximately US$1,269.1 million for purposes including: 1. Upgrading and expanding advanced technology capacity; 2. Conversion of certain logic capacity to specialty technology; 3. Third quarter 2017 R&D capital investments and sustaining capital expenditures; and ● approving the establishment of TSMC Charity Foundation with donation of NT$30,000,000 as its initial capital. Result: all of above matters were reviewed and approved by the Audit Committee whereupon independent directors raised no objection. 040 041 (4) Regular Board Meeting of August 7 & 8, 2017: ● approving capital appropriations of approximately US$3,153.6 million for purposes including: 1. Construction of fab facilities for US$528 million; 2. Other purposes for US$2,625.6 million including: Expanding and upgrading advanced technology equipment; Expanding advanced packaging technology capacity; Upgrading specialty technology capacity; Conversion of logic capacity to specialty technology; Fourth quarter 2017 R&D capital investments and sustaining capital expenditures. (5) Regular Board Meeting of November 13 & 14, 2017: ● approving capital appropriations of approximately US$4,284.5 million for purposes including: 1. US$1,667.5 million for construction of fab facilities; 2. US$2,617 million for other purposes including: Expanding and upgrading advanced technology capacity; Expanding advanced packaging technology capacity; Expanding specialty technology capacity; Conversion of logic capacity to specialty technology; First quarter 2018 R&D capital investments and sustaining capital expenditures; and ● approving the capital injection of not more than US$2 billion to TSMC Global Ltd., a wholly-owned BVI subsidiary, for the purpose of reducing foreign exchange hedging costs. (6) Board Meeting of February 12 & 13, 2018: ● approving 2017 business report and financial statements; ● approving distribution of 2017 profits, and cash dividends, employee cash bonus and employee profit sharing; ● approving capital appropriations of approximately US$2,834 million for purposes including: 1. Installation, upgrading and expanding advanced technology capacity; 2. Conversion of logic capacity to specialty technology; 3. Second quarter 2018 R&D capital investments and sustaining capital expenditures; ● convening the 2018 Annual Shareholders’ Meeting, at which shareholders will hold an election for TSMC’s nine-member Board of Directors, including five independent directors; ● approving the promotions of Dr. T.S. Chang, Dr. Michael Wu, and Dr. Min Cao as Vice Presidents; and ● in gratitude to Dr. Morris Chang, conferring on Dr. Chang the title of “Founder” beginning June 5, 2018. 3.3.3 Major Issues of Record or Written Statements Made by Any Director Dissenting to Important Resolutions Passed by the Board of Directors during 2017 and as of the Date of this Annual Report: None. 3.4 Taiwan Corporate Governance Implementation as Required by Taiwan Financial Supervisory Commission Assessment Item 1. Does Company follow “Taiwan Corporate Governance Implementation” to establish and disclose its corporate governance practices? Yes No V 2. Shareholding Structure & Shareholders’ Rights (1) Does Company have Internal Operation Procedures for handling shareholders’ suggestions, concerns, disputes and litigation matters. If yes, has these procedures been implemented accordingly? (2) Does Company possess a list of major shareholders and beneficial owners of these major shareholders? (3) Has the Company built and executed a risk management system and “firewall” between the Company and its affiliates? (4) Has the Company established internal rules prohibiting insider trading on undisclosed information? V V V V Non- implementation and Its Reason(s) Same as explanation Implementation Status Explanation TSMC has always followed excellent corporate governance practices, provided the utmost in operational transparency and safeguarded shareholders’ equity. Although the Company does not have a formal code of practice for corporate governance, however TSMC has always been highly regarded as the industry leader in implementing comprehensive corporate governance practices. In addition, the Company also has a world-class Board of Directors. The Company believes that corporate governance is based on integrity, professional management and implementation. TSMC has been proving its excellent corporate governance in its operating performance and continued winning of domestic and international awards on best corporate governance company. (1) TSMC has designated appropriate departments, such as Corporate Communication Division, the SEC Compliance Department, Legal Department, etc., to handle shareholder suggestions, concerns, disputes or litigation matters. (2) TSMC tracks the shareholdings of directors, officers, and top ten shareholders. None (3) TSMC has set up internal rules in the Company’s Internal Control System and Affiliated Corporations Management. (4) TSMC has established its “Insider Trading policy” that applies to all employees, officers and members of the Board of Directors of the Company and to any other person having a duty of trust or confidence, with respect to transactions in the Company’s securities. This policy prohibits any insider trading and the Company regularly provides internal training on this issue. (Continued) 042 Assessment Item Implementation Status Yes No Explanation 3. Composition and Responsibilities of the Board of Directors (1) Has the Company established a diversification policy for the composition V (1) The members of TSMC Board of Directors are nominated via a rigorous Non- implementation and Its Reason(s) None of its Board of Directors and has it been implemented accordingly? (2) Other than the Compensation Committee and the Audit Committee which are required by law, does the Company plan to set up other Board committees? (3) Has the Company established methodology for evaluating the performance of its Board of Directors, on an annual basis? (4) Does the Company regularly evaluate its external auditors’ independence? 4. Does the Company established a full- (or part-) time corporate governance unit or personnel to be in charge of corporate governance affairs (including but not limited to furnish information required for business execution by directors, handle matters relating to board meetings and shareholders’ meetings according to laws, handle corporate registration and amendment registration, record minutes of board meetings and shareholders meetings, etc.)? 5. Has the Company established a means of communicating with its Stakeholders (including but not limited to shareholders, employees, customers, suppliers, etc.) or created a Stakeholders Section on its Company website? Does the Company respond to stakeholders’ questions on corporate responsibilities? 6. Has the Company appointed a professional registrar for its Shareholders’ Meetings? 7. Information Disclosure (1) Has the Company established a corporate website to disclose information regarding its financials, business and corporate governance status? (2) Does the Company use other information disclosure channels (e.g. maintaining an English-language website, designating staff to handle information collection and disclosure, appointing spokespersons, webcasting investors conference etc.)? V V V V V V V V selection process. It not only considers diverse backgrounds, professional competence and experience, but also attaches great importance to his/her personal reputation on ethics and leadership. Presently, the Company’s Board of Directors consists of ten members who possess world-class managerial and/ or professional experiences. We rely on each directors’ knowledge, personal insight and business judgment. Two female directors currently sit on the Board of Director, and half of our Board consists of independent directors. (2) Audit Committee (founded in 2002): consists of all five independent directors; Compensation Committee (founded in 2003): consists of all five independent directors; CSR Committee (founded in 2011): is formed by the Company’s management team and reports to the Board of Directors. (3) As TSMC’s corporate governance concept, the Board of Director’s primary responsibility is to supervise, evaluate the management’s performance and dismiss officers of the Company when necessary, resolve the important, concrete matters and provide guidance to the management team. TSMC’s Board of Directors consists of distinguished members with a great breadth of experience as world-class business leaders or professionals and adhere high ethical standards and commitment to the Company. Each quarter’s Board Meeting is last for two days. Company’s resolutions are determined in board meeting, also business strategy and future orientation are discussed in the meeting, in order to create best interest for shareholders. Based on TSMC’s operating performance and local/international awards of best corporate governance, it certainly proves the Company’s excellent performance of Board of Directors. Also, TSMC’s audit committee performs self-evaluation and discusses future issues of concern by questionnaire on annual basis. (4) The Audit Committee annually evaluates the independence of external auditors and reports the same to the Board of Directors. The Chairman appointed the current General Counsel as the Company’s Board secretariat. TSMC’s Corporate & Compliance Legal Division, which directly reports to the General Counsel, is in charge of assisting in related affairs, including furnishing information required for business decisions by Directors, handling matters relating to Board meetings, Committees meetings and Shareholders’ meetings and recording minutes of relevant meetings, etc. The SEC Compliance Department is responsible for handling corporate registration and amendment registration. All application documents needs to be reviewed by Legal and approved by the General Counsel. Depending on the situation, the Company’s Corporate Communication Division, SEC Compliance department, Human Resources department, Customer Service department and Procurement department will communicate with stakeholders. We also have publicly disclosed the contact information of our corporate spokesperson and relevant departments. Also, we have a stakeholder section on our corporate website to address our corporate social responsibilities and any other issues. For details, please refer to “7. Corporate Social Responsibility” on page 118-135 of this Annual Report and “Materiality Analysis and Stakeholder Communication” of TSMC’s CSR Report. None None We have appointed China Trust as our registrar for our Shareholders’ Meetings. None None (1) TSMC discloses its financials business and corporate governance status on its website at http://www.tsmc.com (in Chinese and English). TSMC’s American Depositary Receipt (ADR) is listed on the New York Stock Exchange (NYSE). As a foreign issuer, TSMC must comply with NYSE’s rules. We have been operating in accordance with NYSE listing standards, and have been disclosing the major differences between our corporate governance practices and U.S. corporate governance practices. Please see http://www.tsmc.com/download/ english/e03_governance/NYSE_Section_303A.pdf (2) TSMC has designated appropriate departments (e.g. the Corporate Communication Division, the SEC Compliance Department, etc.) to handle the collection and disclosure of information as required by the relevant laws and regulations of Taiwan and other jurisdictions. TSMC has designated spokespersons as required by relevant regulations. TSMC webcasts live investor conferences. (Continued) 043 Assessment Item Implementation Status Yes No Explanation Non- implementation and Its Reason(s) 8. Has the Company disclosed other information to facilitate a better V (1) For employee rights and employee wellness, please refer to “5.5 Human None understanding of its corporate governance practices (e.g. including but not limited to employee rights, employee wellness, investor relations, supplier relations, rights of stakeholders, directors’ training records, the implementation of risk management policies and risk evaluation measures, the implementation of customer relations policies, and purchasing insurance for directors)? Capital” on page 85-89 of this Annual Report. (2) For investor relations, supplier relations and rights of stakeholders, please refer to “7. Corporate Social Responsibility” on page 118-135 of this Annual Report. (3) For Directors’ training records, please refer to “Continuing Education/Training of Directors” on page 44-45 of this Annual Report. (4) For Risk Management Policies and Risk Evaluation, please refer to “6.3 Risk Management” on page 103-115 of this Annual Report. (5) For Customer Relations Policies, please refer to “5.4 Customer Trust” on page 83-85 of this Annual Report. (6) TSMC maintains D&O Insurance for its directors and officers. 9. The improvement status for the result of Corporate Governance Evaluation announced by Taiwan Stock Exchange TSMC was ranked in top 5% in Corporate Governance Evaluation in 2016 and 2017. The implementation status regarding below three non-scoring items: (1) Establishment a formal code of practice for corporate governance: as the explanation of Assessment Item 1 of this table, although the Company does not have a formal code of practice for corporate governance, however TSMC has always been highly regarded as the industry leader in implementing comprehensive corporate governance practices. In addition, the Company also has a world-class Board of Directors. The Company believes that corporate governance is based on integrity, professional management and implementation. TSMC has been proving its excellent corporate governance in its operating performance and continued winning of domestic and international awards on best corporate governance company. (2) Training of Directors: TSMC’s Board of Directors consists of distinguished members with a great breadth of experience as world-class business leaders or professionals. The Company continually arranges relevant training for Directors during Board meetings, and Directors also participate relevant course as needed. For details, please refer to the below table “Continuing Education/Training of Directors in 2017”. (3) Voluntary disclosure of Directors’ compensation on an individualized basis: From 2016, TSMC discloses compensation paid to Directors, President & Co-CEO and Chief Financial Officer on an individualized basis in its Annual Reports. For details, please refer to “2.4.2 Remuneration Paid to Directors” and “2.5.2 Compensation Paid to President & Co-CEO and Vice Presidents” of 2016 and this Annual Report. Continuing Education/Training of Directors in 2017 The major training methods of Directors includes: ● At quarter Board meetings, TSMC management regularly presents updates on the Company’s business, regulatory developments Michael R. Splinter Morris Chang F.C. Tseng Sir Peter L. Bonfield Stan Shih Thomas J. Engibous Kok-Choo Chen Michael R. Splinter Morris Chang F.C. Tseng Johnsee Lee Mark Liu C.C. Wei Sir Peter L. Bonfield Stan Shih Kok-Choo Chen Michael R. Splinter Name Morris Chang (Note) F.C. Tseng Sir Peter L. Bonfield (Note) Date 04/20 07/28 08/30 08/03 08/09 11/08 09/18 Host by Training/Speech Title Taiwan Economic Daily News Forum Speech: Growth and Innovation-the Constant Value Chinese National Association of Industry and Commerce, Taiwan Speech: Growth and Innovation Monte Jade Science & Technology Association of Taiwan Speech: Growth and Innovation Taiwan Corporate Governance Association Information Security Management of Technology Development Information Security, Personal Information Protection and Liability of Directors and Supervisors of AoT (Analytics of Things) Era The Deal 2018-2019 IFRS Major Changes Corporate Governance UK Conference Speech: Corporate Governance Stan Shih 08/09 Taiwan Corporate Governance Association Information Security, Personal Information Protection and Liability of Directors and Supervisors of AoT (Analytics of Things) Era 2018-2019 IFRS Major Changes 11/08 09/21 06/21 06/22 02/14 Taiwan Insurance Anti-Fraud Institute Anti-Money Laundering and Counter Terrorist Financing Workshop JP Morgan TSMC Director Training Summit “Recent Political & Economic Environment in Taiwan” by Dr. Tain-Jy, Chen, Minister of National Development Council 08/08 TSMC “The New East Asia and Cross-strait Situation” by Dr. Chi SU, Chairman, Taipei Forum and other information to Directors; Note: Selected speeches on corporate governance and related topics. ● The Company arranges speeches regarding politics, economics, and regulatory compliance, etc.; ● At quarter Audit Committee meetings, regular regulatory update reports are provided by TSMC’s General Counsel and by the Company’s independent auditors; and ● Directors participate relevant training courses as needed. In addition, from time to time, Directors are invited by other parties to give speeches on corporate governance and related topics. Continuing Education/Training of Management in 2017 Name/Title Lora Ho Senior Vice President and Chief Financial Officer Sylvia Fang Vice President and General Counsel Cliff Hou Vice President, Design and Technology Platform Jessica Chou Senior Director, Accounting Division John Liang Director, Internal Audit Date 08/03 08/29 08/30 11/02 11/03 08/03 11/10 12/11 12/12 10/16 11/29 Host by Training Taiwan Corporate Governance Association Information Security Management of Technology Development IP Academy Singapore China Law Society Intellectual Property Law Association China Anti-Infringement and Anti-Counterfeit Innovation Strategic Alliance Taiwan Association for Trade Secrets Protection (TTSP) 6th Global Forum on Intellectual Property: Ideas to Assets Speech: Keeping Your Valuable Secrets Secret! Legislative and Other Practical Solutions for Protecting Trade Secrets 2017 Cross-Strait Trade Secrets Protection Forum Taiwan Corporate Governance Association Information Security Management of Technology Development Taiwan Computer Audit Association Case Study on Trade Secrets and Intellectual Property Protection of Enterprises Taiwan Accounting Research and Development Foundation The Annual Professional Development Training for Principal Accounting Officer Taiwan Computer Audit Association Case Sharing of Procurement Auditing (2) Taiwan Accounting Research and Development Foundation Legal Risk to Internal Auditors in the Trending of Business Globalization (including the latest Development of Inside Trading) Duration 20 mins. 40 mins. 40 mins. 3 hours 3 hours 3 hours 2 hours 3 hours 3 hours 1 hour 2 days 40 mins. 1 hour Duration 3 hours 2 days 2 days 3 hours 3 hours 6 hours 6 hours 6 hours 6 hours 044 045 In addition, various training programs and speech presentations were also provided by TSMC’s Legal Organization for Management and the relevant divisions, such as: ● Ethics code and anti-bribery/corruption ● Classified Information and Intellectual Property Protection ● Anti-trust Regulatory Compliance ● Export Control Compliance and Practice 3.5 Code of Ethics and Business Conduct Ethics at TSMC Code of Conduct: Integrity is the most important core value of TSMC’s culture. TSMC is committed to acting ethically in all aspects of our business; constantly and vigilantly promoting integrity, honesty, fairness, accuracy, and transparency in all that we say and do. At the heart of our corporate governance culture is TSMC’s Code of Ethics and Business Conduct (the “Ethics Code”) that applies to TSMC and its subsidiaries. The Ethics Code requires that each employee bears a heavy personal responsibility to preserve and to protect TSMC’s ethical values and reputation and to comply with various applicable laws and regulations. Major Ethics Code Obligations ● Do not advance personal interests at the expense of or in conflict with the Company; ● Refrain from corruption, unfair competition, fraud, collusion, and waste or abuse of corporate assets; ● Avoid any efforts improperly to influence the decisions of anyone, including government officials, agencies, and courts, as well as our customers and suppliers; ● Do not undertake any practices detrimental to TSMC, to the environment, or to society; ● Procure all of our raw materials from socially responsible sources; ● Protect proprietary information of TSMC and our customers; and ● Abide by both the letter and spirit of all applicable laws, rules and regulations. Intellectual Property Protection: In order to build and sustain an environment of innovation, technology leadership, and sustainable profitable growth, the Ethics Code requires that we promote business relationships founded upon an unwavering respect for the intellectual property rights, proprietary information and trade secrets of TSMC, our customers, and others. Public Disclosures: TSMC’s officers, especially our CEO, CFO, and General Counsel, with oversight from our Board, are responsible for the full, fair, accurate, timely, and understandable financial accounting and financial disclosure in reports and documents filed by the Company with securities authorities and in all TSMC public communications and disclosures. TSMC has a variety of measures in place to ensure compliance with these disclosure obligations. Any modification to the Ethics Code requires the approval of our Audit Committee to ensure our ethics compliance program is independently reviewed against corporate best practices. Ethics Code Implementation High Standard Ethical Culture: Our ethics program is implemented in four ways by all of our employees, officers and Board members. First, TSMC’s management sets the “tone from the top” by acting in accordance with the Ethics Code so that they may be an example to all stakeholders. Second, working-level managers are responsible for ensuring their staff’s understanding of and compliance with applicable rules and regulations. Third, we encourage an environment of open communications in discussing any questions related to the Ethics Code. Any employee may consult his or her direct supervisors, Human Resources or Legal to obtain timely advice. Lastly, TSMC requires all employees to stay vigilant and report any noncompliance by anyone to their supervisors, the function head of Human Resources, the responsible corporate Vice President that oversees the Ombudsman system, or to the Chairman of the Company’s Audit Committee directly. Self-Assessment of All Departments and Employees: Self-assessment of all departments and employees is an important part of our ethics compliance program. All departments and subsidiaries of TSMC are required to conduct Control Self-Assessment (CSA) tests annually to review employees’ awareness of the Ethics Code. The CSA results are reviewed to track the results of our compliance program. In addition, all employees must disclose any matters that cause, or may cause, actual or potential conflict of interest. In addition to such proactive disclosure requirement, employees with specific job grades or job responsibilities must annually declare any relationships that may constitute a conflict of interest, which is then reviewed by executive management and reported to the Audit Committee. Internal Auditing: The Internal Auditor of TSMC plays a critical role in ensuring the Company’s compliance with the Ethics Code and relevant rules and regulations. To ensure that our financial, managerial, and operating information is accurate, reliable, and timely and that our employee’s actions are in compliance with applicable policies, standards, procedures, laws and regulations, our Internal Auditor conducts audits of various control points within the Company in accordance with its annual audit plan approved by the Board of Directors and subsequently reports its audit findings and remedial issues to the Board and management on a regular basis. Training and Promotion: To promote awareness to our employees of their responsibilities under the Ethics Code, we publish our Ethics Code and related policies and documents on our intranet and, provide training courses, posters, and internal news articles.In addition, we provide an introductory training course on the Ethics Code which is available to all employees online, as well as advanced courses delving into more specific compliance topics such as anti-corruption, PIP, export control, insider trading and anti-harassment. In addition to our internal compliance efforts, we expect and assist our business partners such as customers and suppliers, and any other entities with whom we deal (such as consultants or third party agents who act for or on behalf of TSMC) to recognize and understand TSMC’s ethical standards to fulfill our responsibilities as a corporate citizen. For instance, we require all of our suppliers to declare in writing that they will not engage in any fraud or any unethical conduct when dealing with us, our officers, or employees. In addition, TSMC is a full member of the Responsible Business Alliance (“RBA”, formerly the Electronic Industry Citizenship Coalition (“EICC”)), dedicated to electronics supply chain sustainability. In addition to adopting the RBA Code of Conduct at all of its facilities, TSMC applied the RBA’s standards to enhance our audit program of our suppliers and relevant business partners. We provide training and communicate our ethical culture to our suppliers through live seminars to prevent any unethical conduct and detect any sign of Ethics Code violations. We exchange views on appropriate business conduct and TSMC’s ethical standards with our customers as part of customer audit programs. Reporting Channels and Whistleblower Protection To ensure that our conduct meets relevant legal requirements and the highest ethical standards under the Ethics Code, TSMC provides multiple channels for reporting business conduct concerns. First of all, our Audit Committee approved and we have implemented the “Complaint Policy and Procedures for Certain Accounting and Legal Matters” and “Procedures for Ombudsman System” that allow employees or any whistleblowers with relevant evidence to report any financial, legal, or ethical irregularities anonymously through either the Ombudsman or directly to the Audit Committee. TSMC maintains additional internal reporting channels for our employees. To foster an open culture of ethics compliance, we encourage our employees and the third parties we do business with to report any suspected wrongdoing by TSMC or by any parties with whom we do business. TSMC treats any complaint and the investigation thereof in a confidential and sensitive manner, and strictly prohibits any form of retaliation against any individual who in good faith reports or helps with the investigation of any complaint. Due to the open reporting channels, TSMC received reports on various issues from employees and external parties such as our customers and suppliers from time to time. Below is a summary of the Number of Reported Incidents. We did not receive any report related to finance or accounting matters in 2017. Incidents reported to the Ombudsman System Incidents reported to the Audit Committee Whistleblower System Incidents reported to the “Irregular Business Conduct Reporting” Total incidents investigated as founded Sexual Harassment Investigation Committee Total incidents investigated as founded FY 2015 FY 2016 FY 2017 60 - 16 - 7 7 80 1 35 2 5 5 79 (Note 1) 2 32 (Note 2) 4 (Note 3) 7 3 (Note 4) Note 1: Among the 79 cases, no incidents related to ethics matters. Note 2: Among the 32 cases, 18 cases related to ethics matters. Note 3: After investigation of the 4 cases, 9 employees confirmed their violation of the Ethics Code. All 9 employees were severely disciplined by the Company and 3 were dismissed. Note 4: After the investigation by TSMC’s Sexual Harassment Investigation Committee, 3 employees involved in these 3 cases received severe discipline from the Company. Ethics Code Violation Disciplinary Action We do not tolerate any violation of the Ethics Code and treat every possible violation incident seriously. Any violator of the Ethics Code (or relevant regulations) will be severely disciplined to the full extent of our policies and the law, up to and including immediate dismissal, termination of business relationship, and judicial prosecution as appropriate. 046 047 3.5.1 Taiwan Corporate Conduct and Ethics Implementation as Required by the Taiwan Financial Supervisory Implementation Status Yes No Explanation Non- implementation and Its Reason(s) None V V V (1) Integrity is the most important core value of TSMC’s culture. TSMC is committed to acting ethically in all aspects of our business. We have established TSMC Code of Ethics and Business Conduct (the “Ethics Code”) to require that each employee bears a heavy personal responsibility to uphold TSMC’s ethics value. For more details on the Ethics Code and the measures that TSMC Board of Directors (the “Board”) and the management team take to ensure compliance of the Ethics Code please refer to TSMC’s Annual Report and the Corporate Social Responsibility Report. (2) At the heart of our corporate governance culture is the Ethics Code that applies to TSMC and its subsidiaries, and this Ethics Code requires that each employee bears a heavy personal responsibility to preserve and to protect TSMC’s ethical values and reputation and to comply with various applicable laws and regulations. Specific requirements under the Ethics Code could be found in our Annual Report. In addition, to educate and remind our employees of their responsibilities under the Ethics Code, we publish our Ethics Code, relevant policies and documents on our intranet and promote its awareness through training courses, posters, and internal news articles. Furthermore, to ensure that our conduct meets relevant legal requirements and the highest ethical standards under the Ethics Code, TSMC provides multiple channels for reporting business conduct concerns. Please refer to Assessment Item 3 for details. We do not tolerate any violation of the Ethics Code and treat every possible violation incident seriously. Any violator of the Ethics Code (or relevant regulations) will be severely punished to the full extent of our policies and the law, including immediate dismissal in accordance with TSMC Employee Recognition, Disciplinary and Ombudsman Procedure, termination of business relationship, and judicial prosecution as appropriate. (3) Under the framework of the Ethics Code, TSMC has established a regulatory compliance program that includes policies, guidelines and procedures in other policy areas, including: Anti-corruption, Anti-harassment/ discrimination, Anti-trust (unfair competition), Environment, Export Control, Financial Reporting/Internal Controls, Insider Trading, Intellectual Property, Proprietary Information Protection (“PIP“), Personal Data Protection, Record Retention and Disposal, as well as procuring certain raw materials from socially responsible sources (“Conflict-free Minerals“). The above-mentioned policies are crucial in facilitating overall compliance with the Ethics Code. TSMC, its employees and its subsidiaries are expected to fully understand and comply with all laws and regulations that govern our businesses, as well as relevant policies, guidelines and procedures, and make ethical decisions in every circumstance. The Internal Auditor of TSMC also plays a critical role in ensuring the Company’s compliance with the Ethics Code and relevant rules and regulations. To ensure that our financial, managerial, and operating information is accurate, reliable, and timely and that our employee’s actions are in compliance with applicable policies, standards, procedures, laws and regulations, our Internal Auditor conducts audits of various control points within the Company in accordance with its annual audit plan approved by the Board of Directors and subsequently reports its audit findings and remedial issues to the Board and Management on a regular basis. Commission Assessment Item 1. Establishment of Corporate Conduct and Ethics Policy and Implementation Measures (1) Does the company have bylaws and publicly available documents addressing its corporate conduct and ethics policy and measures, and the commitment regarding implementation of such policy from the Board of Directors and the management team? (2) Does the company establish relevant policies which are duly enforced to prevent unethical conduct and provide implementation procedures, guidelines, consequence of violation and complaint procedures in such policies? (3) Does the company establish appropriate compliance measures for the business activities prescribed in paragraph 2, article 7 of the Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies and any other such activities associated with high risk of unethical conduct? 048 Assessment Item 2. Ethic Management Practice Implementation Status Yes No Explanation Non- implementation and Its Reason(s) None (1) Does the company assess the ethics records of whom it has business V relationship with and include business conduct and ethics related clauses in the business contracts? (1) We expect and assist our customers, suppliers, business partners, and any other entities with whom we deal (such as consultant or third party agents who act for or on behalf of TSMC) to understand and act in accordance with TSMC’s ethical standards. For instance, as for our suppliers, we require all of them to declare in writing that they will not engage in any fraud or any unethical conduct when dealing with us or our officers and employees. In addition to periodic audit, we provide training and communicate our ethical culture to our suppliers through live seminars to prevent any unethical conduct. We exchange views on appropriate business conduct and TSMC’s ethical standards with our customers as part of customer audit programs. (2) Does the company set up a unit which is dedicated to or tasked with promoting the company’s ethical standards and reports directly to the Board of Directors with periodical updates on relevant matters? V (2) TSMC’s Board of Directors strives to perform the responsibilities of (3) Does the company establish policies to prevent conflict of interests, provide appropriate communication and complaint channels and implement such policies properly? (4) To implement relevant policies on ethical conducts, does the company establish effective accounting and internal control systems that are audited by internal auditors or CPA periodically? V V supervising the corporate conduct and ethics compliance practice through the Audit Committee and the Compensation Committee, the hiring of a financial expert consultant for the Audit Committee, and coordination with the Internal Audit department. The General Counsel and the Corporate & Compliance Legal Division (which directly reports to the General Counsel) promotes, with other divisions, the Company’s ethical standards, and the General Counsel reports quarterly to the Board on the implementation status. In addition, the responsible corporate Vice President who oversees the Ombudsmen system and Internal Auditors update the Board ethical standards compliance issues on a regular basis. Moreover, TSMC’s officers, especially our CEO, CFO, and General Counsel, with oversight from our Board, are responsible for the full, fair, accurate, timely, and understandable financial accounting and financial disclosure in reports and documents filed by the Company with securities authorities and in all TSMC public communications and disclosures. (3) TSMC requires newly hired employees to declare any conflict of interest situation as appropriate. In addition, all employees must disclose any matters that have, or may have, the appearance of undermining the Ethics Code (such as any actual or potential conflict of interest). Furthermore, key employees and senior officers must periodically declare their compliance status with the Ethics Code according to relevant procedures. (4) TSMC continues maintaining the integrity of its financial reporting processes and controls and establishes appropriate internal control systems for preventing higher potential unethical conduct, and the Internal Auditors formulate annual audit plans based on the results of the risk assessment and subsequently reports its audit findings and remedial issues to the Board and Management on a regular basis. In addition, all departments and subsidiaries of TSMC are also required to conduct Control Self-Assessment (CSA) tests annually to review the effectiveness of the internal control system. (5) Does the company provide internal and external ethical conduct training V (5) Training is a major component of our compliance program, conducted programs on a regular basis? (Continued) 3. Implementation of Complaint Procedures (1) Does the company establish specific complaint and reward procedures, set up conveniently accessible complaint channels, and designate responsible individuals to handle the complaint received? (2) Does the company establish standard operation procedures for investigating the complaints received and ensuring such complaints are handled in a confidential manner? (3) Does the company adopt proper measures to prevent a complainant from retaliation for his/her filing a complaint? None throughout the year to refresh TSMC’s employees’ commitment to ethical conduct, and to get updated information on laws and regulations related to their daily operations. As for our suppliers, we communicate our ethical culture to our business partners through live seminars to ensure their fully understanding of our commit to ethical conduct. (1) TSMC’s Audit Committee approved and TSMC has implemented the “Complaint Policy and Procedures for Certain Accounting and Legal Matters“ and “Procedures for Ombudsman System“ that allow employees or any whistleblowers with relevant evidence to report any financial, legal, or ethical irregularities anonymously through either the Ombudsman or directly to the Audit Committee. TSMC also requires all employees to stay vigilant and whistle-blow any noncompliance by anyone to their supervisors, the function head of Human Resources, the responsible corporate Vice President that oversees the Ombudsmen system, or to the Chairman of the Company’s Audit Committee directly. (2) TSMC treats any complaint and the investigation thereof in a confidential and sensitive manner, as is clearly stated in our bylaws. (3) TSMC strictly prohibits any form of retaliation against any individual who in good faith reports or helps with the investigation of any complaint, as is clearly stated in our bylaws. V V V (Continued) 049 Assessment Item 4. Information Disclosure Implementation Status Yes No Explanation Non- implementation and Its Reason(s) None Does the company disclose its guidelines on business ethics as well as information about implementation of such guidelines on its website and Market Observation Post System (“MOPS”)? V Our internal website provides guidelines and informative articles on ethics and honorable business conduct (in both Chinese and English) for employees’ easy access. In addition, TSMC discloses relevant policies and information in its Annual Report (which is also available at the MOPS) and CSR Report (available at: http://www.tsmc.com) 5. If the company has established corporate governance policies based on TSE Corporate Conduct and Ethics Best Practice Principles, please describe any discrepancy between the policies and their implementation. TSMC has established the Ethics Code to require that all employees, officers and board members comply with the Ethics Code and the other policies and procedures. There is no discrepancy between the Ethics Code, including its affiliate policies and procedures, and its implementation. For more details, please refer to “3.5 Code of Ethics and Business Conduct” on page 46-50 of this Annual Report. 6. Other important information to facilitate better understanding of the company’s corporate conduct and ethics compliance practices (e.g., review the company’s corporate conduct and ethics policy). For details on the implementation of TSMC’s Corporate Conduct and Ethics, please refer to “3.5 Code of Ethics and Business Conduct” on page 46-50 of this Annual Report. 3.6 Regulatory Compliance TSMC’s robust compliance efforts are comprised of legislation monitoring, developing and implementation of effective compliance policies and programs, training, and maintaining an open reporting environment. Legislative Monitoring TSMC operates in many countries. To comply with governing legislation, applicable laws, regulations and regulatory expectations, we closely monitor domestic and foreign government policies and regulatory developments that could materially impact TSMC’s business and financial operations. Our Legal organization periodically updates our relevant internal departments, management and the Audit Committee of applicable regulatory changes so that internal teams ensure compliance with new regulatory requirements in a timely manner. We are also a proactive advocate for legislative and regulatory reform, and our comments and recommendations on legal reforms to the government have been accepted constructively. TSMC is increasingly dedicated to identifying potential regulatory issues and will continue to be involved in advocating public policy changes that foster a positive and fair business environment. Policy and Compliance Program Development and Implementation Under the framework of the Ethics Code, TSMC has established a regulatory compliance program that includes policies, guidelines and procedures in different compliance areas, including: Anti-corruption, Anti-harassment/discrimination, Employment Regulations, Anti-trust (unfair competition), Environment, Export Control, Financial Reporting, Internal Controls, Insider Trading, Intellectual Property, Proprietary Information Protection (“PIP”), Personal Data Protection, Record Retention and Disposal, as well as procuring certain raw materials from socially responsible sources (“Conflict-free Minerals”). It is our belief that these policies are crucial in strengthening overall compliance with the Ethics Code and compliance program. TSMC, its employees and its subsidiaries are expected to fully understand and comply with all laws and regulations that govern our businesses, as well as relevant policies, guidelines and procedures, and make ethical decisions in every circumstance. Compliance Awareness Training Training is a major component of our regulatory compliance program, conducted throughout the year to refresh TSMC’s employees’ commitment to ethical conduct, and to get updated information on laws and regulations related to their daily operations. Highlights of our training include: ● Awareness promotion emails to employees, posters at our facilities, and news articles, compliance guidelines, tips and FAQs which our employees can access through our intranet; ● Live seminars focusing on specific topics such as Anti-Corruption (this is also the highlight of our compliance training activities for 2017), PIP, Intellectual Property, Personal Data Protection, Conflict Minerals Compliance and Export Control Management. Training is made mandatory for those employees whose jobs are especially relevant to a particular topic to ensure sufficient awareness of relevant laws and internal policies; ● On-line learning programs updated frequently to provide most up-to-date information and timely and flexible access for employees to understand the law and key compliance issues, covering topics of Anti-trust, Anti-harassment, Insider Trading, Export Control Management, PIP, and Personal Data Protection among others; ● External training, in Taiwan and abroad, for TSMC’s legal team to receive current developments of new laws and regulations, and for its lawyers to comply with applicable continuing legal education requirements. External experts are also invited to give in-house lectures on key issues. Major Accomplishments In 2017, TSMC achieved several major accomplishments in regulatory compliance: ● Public Promotion Activities: In addition to fulfilling our obligations on regulatory compliance matters, TSMC exercised its civic duties as a responsible corporate citizen by advising the local government on law and policy reform, including urging the Government to amend certain outdated laws and regulations, which we believe were inconsistent with global practice, to improve Taiwan’s investment environment and economic development. In 2017, TSMC continues to advocate the importance of trade secret protection and attended relevant events. In addition, TSMC advised the government agencies on the amendment of several laws like the Company Act and environmental protection-related laws. ● Internal Training: Throughout 2017, TSMC offered a wide range of training courses on 40 different compliance topics (28 of which were delivered via live seminar). These courses were all developed and conducted by internal and external compliance experts and legal professionals. ● Continuous Awareness Enhancement of Ethics Code and Anti-Corruption: Any corruption or other violation of the Ethics Code could not only impose long-term negative influence on our competitiveness, but could also seriously damage our strong industry reputation. To enhance employees’ and external partners’ awareness of the Ethics Code and anti-corruption rules, the Legal organization kept the two topics remained as our awareness enhancement focus in 2017 and a series of promotion activities through multiple channels were held, including: (1) 20 face-to-face training sessions to approximately 7,000 employees from various internal organizations to promote awareness of and ensure compliance with TSMC’s business conduct standards when interacting with third parties; (2) on-line training program to approximately 29,000 employees, (including those of our subsidiaries); (3) 6 live seminars to 888 suppliers headquartered in Taiwan or with a operation site in Taiwan. Looking ahead into 2018, it is our objective to continuously provide compliance training on these and other compliance topics to our employees, and the training scope will be expanded to cover on-site operational workers in fabs. ● Conflict-Free Supply Chain: As a recognized global leader in the hi-tech supply chain, we acknowledge our corporate social responsibility to strive to procure conflict-free minerals in an effort to recognize humanitarian and ethical social principles that protect the dignity of all persons. Meanwhile, we have implemented a series of compliance safeguards in accordance with industry leading practices. In 2017, TSMC has made continued progress to ensure a conflict-free supply chain, and our conflict-free minerals compliance program has also been highly ranked by several independent third party rating agencies. ● Export Compliance: TSMC’s export management system (EMS) and policy has been in place for a number of years, and is continuously maintained to ensure compliance with all applicable regulations covering the export of information, technologies, products, materials and equipment. Our EMS was certified in September 2012 by the Bureau of Foreign Trade, the Taiwan regulator, as a qualified ICP (Internal Compliance Program) exporter. In addition, TSMC implements “No ECCN, No Shipment” control and customers are required to provide end use and export control classification number (ECCN) of their products, among other required information, for TSMC to apply for applicable export licenses. To further enhance relevant employees’ awareness on the export control requirements incurred by technology transfers, in 2017 we provided around 25 face-to-face training sessions to approximately 200 manager-level employees in R&D and other relevant functions. ● Other Major Compliance Topics: For other importance compliance topics such as insider trading, anti-harassment, and PIP, in 2017 we not only provided and updated relevant on-line courses and resources, but enhanced employees’ awareness by promotion emails and through posters at facilities. Employees were mandatorily required to complete on-line courses for both anti-harassment and PIP. 050 051 3.7 Internal Control System Execution Status 3.7.1 Statement of Internal Control System Taiwan Semiconductor Manufacturing Company Limited Statement of Internal Control System 3.7.2 If CPA was engaged to conduct a special audit of internal control system, provide its audit report: None. 3.8 Status of Personnel Responsible for the Company Õ s Financial and Business Operation 3.8.1 Resignation or Dismissal of Chairman, President, and Heads of Accounting, Finance, Internal Audit and R&D during 2017 and as of the Date of this Annual Report: None. 3.8.2 Certification of Employees Whose Jobs are Related to the Release of the CompanyÕ s Financial Information Date: February 13, 2018 Certification Based on the findings of a self-assessment, Taiwan Semiconductor Manufacturing Company Limited (TSMC) states the following with regard to its internal control system during the year 2017: 1. TSMCÕ s board of directors and management are responsible for establishing, implementing, and maintaining an adequate internal control system. Our internal control is a process designed to provide reasonable assurance over the effectiveness and efficiency of our operations (including profitability, performance and safeguarding of assets), reliability, timeliness, transparency of our reporting, and compliance with applicable rulings, laws and regulations. 2. An internal control system has inherent limitations. No matter how perfectly designed, an effective internal control system can provide only reasonable assurance of accomplishing its stated objectives. Moreover, the effectiveness of an internal control system may be subject to changes due to extenuating circumstances beyond our control. Nevertheless, our internal control system contains self-monitoring mechanisms, and TSMC takes immediate remedial actions in response to any identified deficiencies. 3. TSMC evaluates the design and operating effectiveness of its internal control system based on the criteria provided in the Regulations Governing the Establishment of Internal Control Systems by Public Companies (herein below, the Ò RegulationsÓ ). The criteria adopted by the Regulations identify five key components of managerial internal control: (1) control environment, (2) risk assessment, (3) control activities, (4) information and communication, and (5) monitoring activities. Certified Public Accountants (CPA) US Certified Public Accountants (US CPA) The Chartered Institute of Management Accountants (CIMA) Certified Internal Auditor (CIA) Chartered Financial Analyst (CFA) Certified Management Accountant (CMA) Financial Risk Manager (FRM) Certification in Control Self-Assessment (CCSA) Certification in Risk Management Assurance (CRMA) Certified Information Systems Auditor (CISA) Chief Fraud Examiner (CFE) BS7799/ISO 27001 Lead Auditor 3.9 Information Regarding TSMCÕ s Independent Auditor 4. TSMC has evaluated the design and operating effectiveness of its internal control system according to the aforesaid 3.9.1 Audit Fees Regulations. Number of Employees Internal Audit Finance 4 4 - 14 - - - 3 5 5 2 2 31 16 1 7 2 1 2 - - - - - 5. Based on the findings of such evaluation, TSMC believes that, on December 31, 2017, it has maintained, in all material respects, an effective internal control system (that includes the supervision and management of our subsidiaries), to provide reasonable assurance over our operational effectiveness and efficiency, reliability, timeliness, transparency of reporting, and compliance with applicable rulings, laws and regulations. 6. This Statement is an integral part of TSMCÕ s annual report for the year 2017 and prospectus, and will be made public. Any falsehood, concealment, or other illegality in the content made public will entail legal liability under Articles 20, 32, 171, and 174 of the Securities and Exchange Law. 7. This statement was passed by the board of directors in their meeting held on February 13, 2018, with none of the ten attending directors expressing dissenting opinions, and the remainder all affirming the content of this Statement. Taiwan Semiconductor Manufacturing Company Limited The Audit Committee approves all fees payable to TSMCÕ s independent auditor and recommends the same to the Board of Directors for further approval. The Board of Directors has authorized the Audit Committee to approve any increase not exceeding 10% of the approved fees. Unit: NT$ thousands Accounting Firm Name of CPA Audit Fee Non-audit Fee System Design Company Registration Human Resource Others (Note 1) Subtotal CPAÕ s Audit Period Remark Deloitte & Touche Yih-Hsin Kao, Yu-Feng Huang, and others 55,647 - - - 81 81 01/01/2017 - 12/31/2017 Note 2 Note 1: Fees mainly related to accounting research tool. Note 2: Article 10.5.1 of Regulation Governing Information to be published in Annual Report of Public Companies was not applicable to TSMC. Morris Chang, Chairman Mark Liu, President and Co-Chief Executive Officer C.C. Wei, President and Co-Chief Executive Officer 052 053 3.9.2 CPA’s information (1) Former CPAs Date of Change Reasons and Explanation of Changes Approved by BOD on November 14, 2017 In compliance with relevant regulatory requirements on rotation, the current engagement partner Yih-Hsin Kao will be replaced by Mei-Yen Chiang starting from 2018. The co-signing partner will remain to be Yu-Feng Huang. State whether the Appointment is Terminated or Rejected by the Consignor or CPAs Status Client CPA Appointment terminated automatically Not available Appointment rejected (discontinued) Not available The Opinions other than Unmodified Opinion Issued in the Last Two Years and the Reasons for the Said Opinions (Note) Is there any disagreement in opinion with the issuer Supplementary Disclosure (Disclosures Specified in Article 10.6.1.4~7 of the Standards) None Yes No Explanation None Note: Starting in 2016, the new auditing standard of the Republic of China requires “An Unqualified Opinion” be replaced by “An Unmodified Opinion”. Consignor Not available Not available Accounting principle or practice Disclosure of financial statements Auditing scope or procedures Others V (2) Successor CPAs Accounting Firm CPA Date of Engagement Deloitte & Touche Mei-Yen Chiang and Yu-Feng Huang Approved by BOD on November 14, 2017 Prior to the Formal Engagement, Any Inquiry or Consultation on the Accounting Treatment or Accounting Principles for Specific Transactions, and the Type of Audit Opinion that Might be Rendered on the Financial Report Written Opinions from the Successor CPAs that are Different from the Former CPA’s Opinions None None (3) The Reply of Former CPAs on Article 10.6.1 and Article 10.6.2.3 of the Standards: None. 3.9.3 TSMC’s Chairman, Directors, Chief Executive Officer, Chief Financial Officer, and Managers in Charge of Its Finance and Accounting Operations did not Hold any Positions within TSMC’s Independent Audit Firm or Its Affiliates in the Most Recent Year. 3.9.4 Evaluation of the External Auditor’s Independence The Audit Committee regularly monitors the independence of TSMC’s external auditor by conducting the below evaluations and reports the same to the Board of Directors: 1. The auditor’s independence declaration 2. The Audit Committee pre-approves all audit and non-audit services conducted by the auditor to ensure that the non-audit services do not influence the results of the audit 3. Ensure the audit partner rotates every five years 4. Annually evaluate the independence of the external auditor based on the results of the auditor survey 3.10 Material Information Management Procedure TSMC has established relevant procedures for managing and disclosing material information. The responsible departments regularly remind all officers and employees about the need to comply with these procedures and other applicable regulations when they become aware of any potential material information and the possible need to publicly disclose such information. To ensure that our employees, managers and board directors are aware of and comply with these relevant regulations, TSMC has also established our “Insider Trading Policy”. To reduce the risk of insider trading, on-line training programs and live seminars are conducted periodically. In addition, employees can familiarize themselves with relevant internal policies and training articles by easily accessing TSMC’s Legal Organization intranet website. 054 055 056 056 057 057 4. Capital and Shares 4.1 Capital and Shares 4.1.1 Capitalization Unit: Share/NT$ Month/ Year Issue Price (Per Share) Authorized Share Capital Capital Stock Shares Amount Shares Amount Sources of Capital Remark Capital Increase by Assets Other than Cash 07/2015 10 28,050,000,000 280,500,000,000 25,930,380,458 259,303,804,580 Exercise of Employee Stock None Options: NT$7,180,220 As of 02/28/2018 Date of Approval & Approval Document No. 07/13/2015 Zhu Shang Tzu No.1040020526 As of 02/28/2018 Total Authorized Share Capital Issued Shares Listed Non-listed Total Unissued Shares 25,930,380,458 - 25,930,380,458 2,119,619,542 28,050,000,000 4.1.2 Capital and Shares Unit: Share Type of Stock Common Stock Shelf Registration: None. 4.1.3 Composition of Shareholders Common Share Distribution Profile of Share Ownership Common Share Shareholder Ownership (Unit: Share) Number of Shareholders 1-999 1,000-5,000 5,001-10,000 10,001-15,000 15,001-20,000 20,001-30,000 30,001-40,000 40,001-50,000 50,001-100,000 100,001-200,000 200,001-400,000 400,001-600,000 600,001-800,000 800,001-1,000,000 Over 1,000,001 Total 146,197 123,140 22,569 8,690 4,023 4,533 2,133 1,377 2,757 1,559 1,037 486 280 189 1,457 320,427 Type of Shareholders Government Agencies Financial Institutions Other Juridical Persons Foreign Institutions and Natural Persons Domestic Natural Persons Number of Shareholders 7 151 1,149 4,231 314,889 As of 07/02/2017 (last record date) Total 320,427 Preferred Share: None. 4.1.4 Major Shareholders Common Share Shareholders ADR-Taiwan Semiconductor Manufacturing Company, Ltd. National Development Fund, Executive Yuan Shareholding 1,653,710,189 599,818,046 1,058,236,528 20,658,779,209 1,959,836,486 25,930,380,458 Government of Singapore Holding Percentage (%) 6.38% 2.31% 4.08% 79.67% 7.56% 100.00% JPMorgan Chase Bank N.A. Taipei Branch in Custody for EuroPacific Growth Fund Norges Bank JPMorgan Chase Bank N.A. Taipei Branch in Custody for Oppenheimer Developing Markets Funds, managed by Oppenheimer Funds, Inc. JPMorgan Chase Bank N.A. Taipei Branch in Custody for Vanguard Total International Stock Index Fund, a series of Vanguard Star Funds JPMorgan Chase Bank N.A. Taipei Branch in Custody for Saudi Arabian Monetary Agency Vanguard Emerging Markets Stock Index Fund, a series of Vanguard International Equity Index Funds New Perspective Fund Ownership 32,498,982 255,563,253 161,289,971 105,600,468 70,667,777 110,598,899 73,710,156 61,895,110 192,609,685 218,927,430 292,221,179 236,470,478 193,341,382 170,302,518 23,754,683,170 25,930,380,458 Total Shares Owned 5,341,120,243 1,653,709,980 654,494,172 430,430,649 317,463,515 287,172,429 285,329,063 252,148,426 237,443,845 221,552,994 As of 07/02/2017 (last record date) Ownership (%) 0.13% 0.99% 0.62% 0.41% 0.27% 0.43% 0.28% 0.24% 0.74% 0.84% 1.13% 0.91% 0.75% 0.66% 91.60% 100.00% As of 07/02/2017 (last record date) Ownership (%) 20.60% 6.38% 2.52% 1.66% 1.22% 1.11% 1.10% 0.97% 0.92% 0.85% 058 059 Title Name Vice President Irene Sun Vice President Cliff Hou Vice President Been-Jon Woo Vice President and General Counsel Sylvia Fang Vice President Connie Ma Vice President Y.L. Wang Vice President Doug Yu Vice President and TSMC Fellow Alexander Kalnitsky Vice President Kevin Zhang Vice President and TSMC Fellow T.S. Chang (Note) Vice President Michael Wu (Note) Vice President Min Cao (Note) 2017 01/01/2018 ~ 02/28/2018 Net Change in Shareholding Net Change in Shares Pledged Net Change in Shareholding Net Change in Shares Pledged - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Note: Dr. T.S. Chang, Dr. Michael Wu and Dr. Min Cao were promoted to Vice President, effective February 13, 2018. Their shareholdings were disclosed starting from that date. 4.1.5 Net Change in Shareholding by Directors, Management and Shareholders with 10% Shareholdings or More Unit: Share Title Name Chairman Morris Chang Vice Chairman F.C. Tseng Director National Development Fund, Executive Yuan Representative: Mei-ling Chen Independent Director Sir Peter L. Bonfield Independent Director Stan Shih Independent Director Thomas J. Engibous Independent Director Kok-Choo Chen Independent Director Michael R. Splinter Director President and Co-Chief Executive Officer Mark Liu Director President and Co-Chief Executive Officer C.C. Wei Senior Vice President and Chief Information Officer Stephen T. Tso Senior Vice President, Chief Financial Officer and Spokesperson Lora Ho Senior Vice President Wei-Jen Lo Senior Vice President of TSMC and Chief Executive Officer of TSMC North America Rick Cassidy Senior Vice President Y.P. Chin Senior Vice President Y.J. Mii Vice President M.C. Tzeng Vice President and Chief Technology Officer Jack Sun Vice President N.S. Tsai Vice President J.K. Lin Vice President J.K. Wang 2017 01/01/2018 ~ 02/28/2018 Net Change in Shareholding Net Change in Shares Pledged Net Change in Shareholding Net Change in Shares Pledged - - - - - - - - - (64,000) - (645,000) - (24,000) - (69,000) - (269,000) (90,000) - 20,000 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - (30,000) - - - (1,000) - - (3,000) (27,000) - - - - - - - - - - - - - - - - - - - - - - - - (Continued) 060 061 4.1.6 Stock Trade with Related Party: None. 4.1.7 Stock Pledge with Related Party: None. 4.1.8 Related Party Relationship among Our 10 Largest Shareholders Common Share Name Current Shareholding Spouse and Minor Shareholding TSMC Shareholding by Nominee Arrangement ADR-Taiwan Semiconductor Manufacturing Company, Ltd. 5,341,120,243 National Development Fund, Executive Yuan 1,653,709,980 Shares % Shares Representative: Mei-ling Chen Government of Singapore JPMorgan Chase Bank N.A. Taipei Branch in Custody for EuroPacific Growth Fund Norges Bank JPMorgan Chase Bank N.A. Taipei Branch in Custody for Oppenheimer Developing Markets Funds, managed by Oppenheimer Funds, Inc. JPMorgan Chase Bank N.A. Taipei Branch in Custody for Vanguard Total International Stock Index Fund, a series of Vanguard Star Funds 20.60% 6.38% - 2.52% 1.66% 1.22% 1.11% - 654,494,172 430,430,649 317,463,515 287,172,429 285,329,063 1.10% JPMorgan Chase Bank N.A. Taipei Branch in Custody for Saudi Arabian Monetary Agency 252,148,426 0.97% Vanguard Emerging Markets Stock Index Fund, a series of Vanguard International Equity Index Funds 237,443,845 0.92% New Perspective Fund 221,552,994 0.85% As of 07/02/2017 (last record date) Name and Relationship between TSMC’s Shareholders Name Relationship None None None None None None None None None None None None None None None None None None None None None None % N/A N/A - N/A N/A N/A N/A N/A N/A N/A N/A Shares N/A N/A - N/A N/A N/A N/A N/A N/A N/A N/A % N/A N/A - N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A - N/A N/A N/A N/A N/A N/A N/A N/A Ownership by TSMC (1) Ownership by Directors, Managers and Directly/Indirectly Owned Subsidiaries (2) Total Ownership (1) + (2) Shares % Shares % Shares % As of 12/31/2017 4.1.9 Long-term Investment Ownership Long-term Investment Equity Method: TSMC Partners, Ltd. TSMC Global Ltd. TSMC North America TSMC Europe B.V. TSMC Japan Limited TSMC Korea Limited 988,268,244 9,284 11,000,000 200 6,000 80,000 100% 100% 100% 100% 100% 100% - - - - - - TSMC China Company Limited Not Applicable (Note 1) 100% Not Applicable (Note 1) TSMC Nanjing Company Limited Not Applicable (Note 1) 100% Not Applicable (Note 1) TSMC Solar Europe GmbH (Note 2) VisEra Technologies Company Ltd. Systems on Silicon Manufacturing Co. Pte. Ltd. Vanguard International Semiconductor Corp. Xintec Inc. Global UniChip Corporation 800 253,120,000 313,603 464,223,493 111,281,925 46,687,859 100% 86.94% 38.79% 28.32% 40.92% 34.84% - - - - 17,000 275,877,722 16.83% (Note 3) VentureTech Alliance Fund II, L.P. Not Applicable (Note 1) 98.00% Not Applicable (Note 1) VentureTech Alliance Fund III, L.P. Not Applicable (Note 1) 98.00% Not Applicable (Note 1) Note 1: Not applicable. These firms do not issue shares. TSMC’s investment is measured as a percentage of ownership. Note 2: The dissolution procedures of TSMC Solar Europe GmbH are expected to be completed by the end of June 2018. Note 3: TSMC’s Director, National Development Fund of Executive Yuan, holds 16.72% while other Directors and Management hold 0.11%. - - - - - - - - - - - - 0.01% - - 988,268,244 9,284 11,000,000 200 6,000 80,000 Not Applicable (Note 1) Not Applicable (Note 1) 800 253,120,000 313,603 740,101,215 111,281,925 46,704,859 Not Applicable (Note 1) Not Applicable (Note 1) 100% 100% 100% 100% 100% 100% 100% 100% 100% 86.94% 38.79% 45.16% 40.92% 34.85% 98.00% 98.00% 062 063 4.1.10 Share Information 4.1.12 Compensation to Directors and Profit Sharing Bonus to Employees TSMC’s earnings per share in 2017 increase 2.7% from 2016 to NT$13.23 per share. The following table details TSMC’s market price, net worth, earnings, and dividends per common share, as well as other data regarding return on investment. Based on TSMC’s Articles of Incorporation, before paying dividends or bonuses to shareholders, TSMC shall set aside not more than 0.3% of its annual profit to directors as compensation and not less than 1% to employees as profit sharing bonus. Market Price, Net Worth, Earnings, and Dividends Per Common Share Unit: NT$, except for weighted average shares and return on investment ratios Item Market Price Per Share (Note 1) Highest Market Price Lowest Market Price Average Market Price Net Worth Per Share Before Distribution After Distribution Earnings Per Share 2016 193.00 131.50 166.36 53.58 46.58 Weighted Average Shares (thousand shares) 25,930,380 25,930,380 Diluted Earnings Per Share Dividends Per Share Cash Dividends Accumulated Undistributed Dividend Return on Investment Price/Earnings Ratio (Note 2) Price/Dividend Ratio (Note 3) Cash Dividend Yield (Note 4) Note 1: Referred to TWSE website Note 2: Price/Earnings Ratio = Average Market Price/ Diluted Earnings Per Share Note 3: Price/Dividend Ratio = Average Market Price/Cash Dividends Per Share Note 4: Cash Dividend Yield = Cash Dividends Per Share/Average Market Price Note 5: Pending shareholders’ approval 4.1.11 Dividend Policy and Distribution of Earnings 12.89 7.00 - 12.91 23.77 4.2% 13.23 8.00 (Note 5) - 15.88 26.26 (Note 5) 3.8% (Note 5) 2017 01/01/2018 ~ 02/28/2018 244.00 179.50 210.09 58.70 50.70 (Note 5) 266.00 232.50 246.03 - - - - - - - - - As resolved by TSMC’s Board of Directors on February 13, 2018, a profit sharing bonus to employees was expensed based on a certain percentage of 2017 profit; compensation to directors was expensed based on the estimated amount of payment. If the actual amounts subsequently paid differ from the above estimated amounts, the differences will be recorded in the year paid as a change in accounting estimate. 2017 Directors’ Compensation and Employees’ Profit Sharing Bonus Directors’ Compensation (Cash) Employee’s Profit Sharing Bonus (Cash) Total Board Resolution (02/13/2018) Amount (NT$) 368,919,380 23,019,082,263 23,388,001,643 Note: NT$23,019,082,263 employees’ cash bonus has already been distributed following each quarter of 2017. The above employees’ profit sharing bonus will be distributed in July, 2018. 2016 Directors’ Compensation and Employees’ Profit Sharing Bonus Directors’ Compensation (Cash) Employees’ Profit Sharing Bonus (Cash) Total Board Resolution (02/14/2017) Actual Result (Note) Amount (NT$) 376,432,200 22,418,339,262 22,794,771,462 Amount (NT$) 376,432,200 22,418,339,262 22,794,771,462 Note: The above Directors’ Compensation and Employees’ Profit Sharing Bonus were expensed under the Company’s 2016 statement of comprehensive income and the same amounts were approved by the Board of Directors at its meeting on February 14, 2017. 4.1.13 Impact to 2018 Business Performance and EPS Resulting from Stock Dividend Distribution: Not applicable. 4.1.14 Buyback of Common Stock: None. TSMC does not pay dividends when there are no profits or retained earnings. TSMC has distributed cash dividends every year to its shareholders since 2004. TSMC intends to maintain a stable and sustainable dividend policy, and will consider raising dividends when free cash flow is sufficient to cover the previous level of dividend payment and any debt repayment. On February 13, 2018, TSMC’s Board of Directors adopted a proposal recommending distribution of a cash dividend of NT$8 per share as shown in the table below. The proposal will be implemented according to the relevant regulations, upon the approval of shareholders at the Annual Shareholders’ Meeting on June 5, 2018. Proposal to Distribute 2017 Earnings Unit: NT$ Cash Dividends Paid to Common Shareholders (NT$8 per share) 207,443,043,664 064 065 4.2 Issuance of Corporate Bonds 4.2.1 Corporate Bonds NTD Corporate Bonds As of 02/28/2018 Issuance Issuing Date Denomination Offering Price Total Amount Coupon Domestic Unsecured Bond (100-1) Domestic Unsecured Bond (100-2) Domestic Unsecured Bond (101-1) Domestic Unsecured Bond (101-2) Domestic Unsecured Bond (101-3) Domestic Unsecured Bond (101-4) Domestic Unsecured Bond (102-1) Domestic Unsecured Bond (102-2) Domestic Unsecured Bond (102-3) Domestic Unsecured Bond (102-4) 09/28/2011 NT$10,000,000 Par 01/11/2012 NT$10,000,000 Par 08/02/2012 NT$10,000,000 Par 09/26/2012 NT$10,000,000 Par 10/09/2012 NT$10,000,000 Par 01/04/2013 NT$10,000,000 Par 02/06/2013 NT$10,000,000 Par 07/16/2013 NT$10,000,000 Par 08/09/2013 NT$10,000,000 Par 09/25/2013 NT$10,000,000 Par NT$18,000,000,000 NT$17,000,000,000 NT$18,900,000,000 NT$21,700,000,000 NT$4,400,000,000 NT$23,600,000,000 NT$21,400,000,000 NT$13,700,000,000 NT$12,500,000,000 NT$15,000,000,000 Tranche A: 1.40% p.a. Tranche B: 1.63% p.a. Tranche A: 1.29% p.a. Tranche B: 1.46% p.a. Tranche A: 1.28% p.a. Tranche B: 1.40% p.a. Tranche A: 1.28% p.a. Tranche B: 1.39% p.a. 1.53% p.a. Tranche A: 1.23% p.a. Tranche B: 1.35% p.a. Tranche C: 1.49% p.a. Tranche A: 1.23% p.a. Tranche B: 1.38% p.a. Tranche C: 1.50% p.a. Tranche A: 1.50% p.a. Tranche B: 1.70% p.a. Tranche A: 1.34% p.a. Tranche B: 1.52% p.a. Tenor and Maturity Date Tranche A: 5 years Maturity: 09/28/2016 Tranche B: 7 years Maturity: 09/28/2018 Tranche A: 5 years Maturity: 01/11/2017 Tranche B: 7 years Maturity: 01/11/2019 Tranche A: 5 years Maturity: 08/02/2017 Tranche B: 7 years Maturity: 08/02/2019 Tranche A: 5 years Maturity: 09/26/2017 Tranche B: 7 years Maturity: 09/26/2019 Tenor: 10 years Maturity: 10/09/2022 Tranche A: 5 years Maturity: 01/04/2018 Tranche B: 7 years Maturity: 01/04/2020 Tranche C: 10 years Maturity: 01/04/2023 Tranche A: 5 years Maturity: 02/06/2018 Tranche B: 7 years Maturity: 02/06/2020 Tranche C: 10 years Maturity: 02/06/2023 Tranche A: 7 years Maturity: 07/16/2020 Tranche B: 10 years Maturity: 07/16/2023 Tranche A: 4 years Maturity: 08/09/2017 Tranche B: 6 years Maturity: 08/09/2019 Tranche A: 1.35% p.a. Tranche B: 1.45% p.a. Tranche C: 1.60% p.a. Tranche D: 1.85% p.a. Tranche E: 2.05% p.a. Tranche F: 2.10% p.a. Tranche A: 3 years Maturity: 09/25/2016 Tranche B: 4 years Maturity: 09/25/2017 Tranche C: 5.5 years Maturity: 03/25/2019 Tranche D: 7.5 years Maturity: 03/25/2021 Tranche E: 9.5 years Maturity: 03/25/2023 Tranche F: 10 years Maturity: 09/25/2023 NT$12,000,000,000 Outstanding Credit Rating Trustee Guarantor Underwriter Legal Counsel Auditor Repayment Redemption or Early Repayment Clause Covenants Other Rights of Bondholders Conversion Right Amount of Converted or Exchanged Common Shares, ADRs or Other Securities NT$7,500,000,000 NT$7,000,000,000 NT$9,000,000,000 NT$9,000,000,000 NT$4,400,000,000 NT$13,000,000,000 NT$15,200,000,000 NT$13,700,000,000 NT$8,500,000,000 twAAA (Taiwan Ratings Corporation, 08/24/2011) twAAA (Taiwan Ratings Corporation, 12/06/2011) twAAA (Taiwan Ratings Corporation, 07/02/2012) Mega International Commercial Bank twAAA (Taiwan Ratings Corporation, 08/23/2012) Taipei Fubon Commercial Bank twAAA (Taiwan Ratings Corporation, 09/04/2012) twAAA (Taiwan Ratings Corporation, 11/29/2012) twAAA (Taiwan Ratings Corporation, 12/18/2012) twAAA (Taiwan Ratings Corporation, 05/16/2013) twAAA (Taiwan Ratings Corporation, 07/15/2013) twAAA (Taiwan Ratings Corporation, 08/06/2013) None Not Applicable Modern Law Office Deloitte & Touche Bullet None None None Not Applicable Dilution Effect and Other Adverse Effects on Existing Shareholders Custodian None None USD Corporate Bonds Issuance Issuing Date Denomination Listing Offering Price Total Amount Coupon Tenor and Maturity Date Guarantor Trustee Underwriter Senior Unsecured Notes (Note) 04/03/2013 US$200,000 and integral multiples of US$1,000 in excess thereof Singapore Exchange 2016 Notes: 99.988% 2018 Notes: 99.933% US$1,500,000,000 2016 Notes: 0.950% p.a. 2018 Notes: 1.625% p.a. 2016 Notes: 3 years Maturity: 04/03/2016 2018 Notes: 5 years Maturity: 04/03/2018 TSMC Citicorp International Limited Goldman Sachs International As of 02/28/2018 Legal Advisor Auditor Repayment Outstanding Jones Day Maples and Calder Deloitte & Touche Bullet US$1,150,000,000 Redemption or Early Repayment Clause At issuer’s option Covenants Credit Rating Limitations on (1) liens and (2) sale and leaseback transactions Aa3 (Moody’s Investors Service, 03/12/2018) A+ (Standard & Poor’s Rating Services, 03/15/2013) Conversion Right None Other Rights of Bondholders Amount of Converted or Exchanged Common Shares, ADRs or Other Securities Dilution Effect and Other Adverse Effects on Existing Shareholders Custodian Not Applicable None None 066 067 (Continued) Note: Issued by TSMC Global Ltd., a wholly-owned subsidiary of TSMC, and unconditionally and irrevocably guaranteed by TSMC. 4.2.2 Convertible Bond: None. 4.2.3 Exchangeable Bond: None. 4.2.4 Shelf Registration: None. 4.2.5 Bond with Warrants: None. 4.3 Preferred Shares 4.3.1 Preferred Share: None. 4.3.2 Preferred Share with Warrants: None. 4.4 Issuance of American Depositary Shares Issuing Date 10/08/1997 11/20/1998 01/12/1999 - 01/14/1999 07/15/1999 08/23/1999 - 09/09/1999 02/22/2000 - 03/08/2000 04/17/2000 06/07/2000 - 06/15/2000 Total Amount (US$) 594,720,000 184,554,440 35,500,000 296,499,641 158,897,089 379,134,599 224,640,000 1,167,873,850 05/14/2001 - 06/11/2001 240,999,660 06/12/2001 11/27/2001 02/07/2002 - 02/08/2002 11/21/2002 - 12/19/2002 297,649,640 320,600,000 1,001,650,000 160,097,914 07/14/2003 - 07/21/2003 908,514,880 11/14/2003 08/10/2005 - 09/08/2005 05/23/2007 1,077,000,000 1,402,036,500 2,563,200,000 Offering Price Per ADS (US$) 24.78 15.26 17.75 24.516 28.964 57.79 56.16 35.75 20.63 20.63 16.03 16.75 8.73 10.40 10.77 8.6 10.68 24,000,000 12,094,000 2,000,000 12,094,000 5,486,000 6,560,000 4,000,000 32,667,800 120,000,000 60,470,000 10,000,000 60,470,000 27,430,000 32,800,000 20,000,000 163,339,000 11,682,000 58,410,000 14,428,000 72,140,000 20,000,000 59,800,000 18,348,000 87,357,200 100,000,000 163,027,500 240,000,000 100,000,000 299,000,000 91,740,000 436,786,000 500,000,000 815,137,500 1,200,000,000 TSMC Common Shares from Selling Shareholders (Pursuant to ADR Conversion Sale Program) TSMC Common Shares from Selling Shareholders (Pursuant to ADR Conversion Sale Program) TSMC Common Shares from Selling Shareholders Cash Offering and TSMC Common Shares from Selling Shareholders (Note 4) TSMC Common Shares from Selling Shareholders (Pursuant to ADR Conversion Sale Program) (Note 3) TSMC Common Shares from Selling Shareholders TSMC Common Shares from Selling Shareholders TSMC Common Shares from Selling Shareholders TSMC Common Shares from Selling Shareholders TSMC Common Shares from Selling Shareholders (Pursuant to ADR Conversion Sale Program) TSMC Common Shares from Selling Shareholders TSMC Common Shares from Selling Shareholders TSMC Common Shares from Selling Shareholders Units Issued Common Shares Represented Underlying Securities TSMC Common Shares from Selling Shareholders TSMC Common Shares from Selling Shareholders TSMC Common Shares from Selling Shareholders TSMC Common Shares from Selling Shareholders Apportionment of Expenses for Issuance and Maintenance (Note 3) Issuance and Listing NYSE Rights and Obligations of ADS Holders Same as those of Common Share Holders Trustee Not Applicable Depositary Bank Citibank,N.A.–NewYork Citibank, N.A. – Taipei Branch As of February 28, 2018, total number of outstanding ADSs was 1,068,164,518 See Deposit Agreement and Custody Agreement for Details Custodian Bank (Note 1) ADSs Outstanding (Note 2) Terms and Conditions in the Deposit Agreement and Custody Agreement Closing Price Per ADS (US$; source: Bloomberg) 2017 01/01/2018 - 02/28/2018 High Low Average High Low Average 42.99 29.29 35.73 46.38 40.36 43.33 Note 1: Citibank, N.A., Taipei Branch changed its name to “Citibank Taiwan Limited” in 2009. Note 2: TSMC has in aggregate issued 813,544,500 ADSs since 1997, which, if taking into consideration stock dividends distributed over the period, would amount to 1,147,835,205 ADSs. Stock dividends distributed in 1998, 1999, 2000, 2001, 2002, 2003, 2004, 2005, 2006, 2007, 2008 and 2009 were 45%, 23%, 28%, 40%, 10%, 8%, 14.08668%, 4.99971%, 2.99903%, 0.49991%, 0.50417% and 0.49998%, respectively. As of February 28, 2018, total number of outstanding ADSs was 1,068,164,518 after 79,670,687 were redeemed. Note 3: All fees and expenses such as underwriting fees, legal fees, listing fees and other expenses related to issuance of ADSs were borne by the selling shareholders, while maintenance expenses such as annual listing fees and accountant fees were borne by TSMC. Note 4: All fees and expenses such as underwriting fees, legal fees, listing fees and other expenses related to issuance of ADSs were borne proportionately by TSMC and the selling shareholders, while maintenance expenses such as annual listing fees and accountant fees were borne by TSMC. 068 069 4.5 Status of Employee Stock Option Plan 4.5.1 Issuance of Employee Stock Options: None. 4.5.2 Employee Stock Options Granted to Management Team and to Top 10 Employees: None. 4.6 Status of Employee Restricted Stock 4.6.1 Status of Employee Restricted Stock: None. 4.6.2 Employee Restricted Stock Granted to Management Team and to Top 10 Employees: None. 4.7 Status of New Share Issuance in Connection with Mergers and Acquisitions: None. 4.8 Financing Plans and Implementation: Not applicable. 070 071 072 072 073 073 073 5. Operational Highlights 5.1 Business Activities 5.1.1 Business Scope As the founder and leader of the dedicated semiconductor foundry segment, TSMC provides a full range of integrated semiconductor foundry services, including the most advanced process technologies, leading specialty technologies, the most comprehensive design ecosystem support, excellent manufacturing productivity and quality, advanced mask and packaging services, and so on, to meet a growing variety of customer needs. The Company strives to provide the best overall value to its customers and views customer success as TSMC success. As a result, TSMC has won customer trust from around the world and has experienced strong growth and success. 5.1.2 Customer Applications TSMC manufactured 9,920 different products for 465 customers in 2017. These chips were used across a broad spectrum of electronic applications, including computers and peripherals, information appliances, wired and wireless communication systems, automotive and industrial equipment, consumer electronics such as digital TVs, game consoles, digital cameras and many other devices and applications. The rapid ongoing evolution of end products prompts customers to pursue differentiation using TSMCÕ s innovative technologies and services and, at the same time, spurs TSMCÕ s own development of technology. As always, success depends on leading rather than following industry trends. 5.1.3 Consolidated Shipments and Net Revenue in 2017 and 2016 Unit: Shipments (thousand 12-inch equivalent wafers) / Net Revenue (NT$ thousands) 2017 2016 Shipments Net Revenue Shipments Net Revenue Wafer Domestic (Note 1) Export Others (Note 2) Domestic (Note 1) Total Export Domestic (Note 1) Export 1,650 8,799 N/A N/A 1,650 8,799 89,796,998 784,775,622 7,969,232 94,905,389 97,766,230 879,681,011 1,849 7,757 N/A N/A 1,849 7,757 Note 1: Domestic means sales to Taiwan. Note 2: Others mainly include revenue associated with packaging and testing services, mask making, design services, and royalties. 5.1.4 Production in 2017 and 2016 Unit: Capacity / Output (million 12-inch equivalent wafers) / Amount (NT$ millions) Wafers Capacity 11-12 10-11 Output 10-11 9-10 Year 2017 2016 074 127,717,686 733,453,169 6,802,548 79,964,941 134,520,234 813,418,110 Amount 454,603 405,462 5.2 Technology Leadership 5.2.1 R&D Organization and Investment In 2017 TSMC continued to invest in research and development, with total R&D expenditures amounting to 8% of revenue, a level that equals or exceeds the R&D investment of many other leading high- tech companies. TSMC recognizes that the technology challenge of continuing to extend MooreÕ s Law, the doubling of semiconductor computing power every two years, is becoming increasingly complex and difficult. The efforts of the R&D organization are focused on enabling the Company to continuously offer customers first-to-market, leading-edge technologies and design solutions that contribute to their product success in todayÕ s competitive environment. In 2017 the R&D organization met these challenges by completing the transfer to manufacturing of the industry leading 7nm technology, the fourth generation of technology platform to make use of 3D FinFET transistors. The R&D organization continues to fuel the pipeline of technological innovation needed to maintain industry leadership. TSMCÕ s 7nm technology is on track to ramp up volume production in 2018. TSMC 5nm technology continues in full development stage, and the definition and intensive early development efforts have been progressing for nodes beyond 5nm. In addition to CMOS logic, TSMC conducts R&D on a wide range of other semiconductor technologies that provide the functionality required by customers for mobile SoC and other applications. Highlights in 2017 included: the high-volume production of Gen-2 Integrated Fan-Out Package on Package (InFO-PoP) for mobile application processor packaging; successful qualification of Gen-3 InFO-PoP advanced packaging technology for mobile applications and Integrated Fan-Out on Substrate (InFO-oS) for die-partition and HPC applications; 0.18µm third generation BCD (Bipolar-CMOS-DMOS) technology resulting in the leading performance quick charger and wireless charger in 2017; successful production launch of eFlash 40nm node, NOR-based cell technologies and Split-Gate cell for consumer electronics applications such as IoT, smartcards and micro controller units; development and manufacturing qualification of 650V, 100V E-HEMT, and RF 30V D-MISFET GaN devices; and 40nm high-voltage phase-2 technology readiness for both LCD and OLED drivers. TSMC maintains a network of important external R&D partnerships and alliances with world-class research institutions, including GRC/SRC in the US, and IMEC the highly regarded European R&D consortium, where TSMC is a core partner. TSMC also provides funding for nanotechnology research at leading universities worldwide to promote innovation and the advancement of nano-electronic technology. R&D Expenditures Amount: NT$ thousands 3 6 4 , 2 3 7 , 0 8 3 0 7 , 7 0 2 , 1 7 2016 2017 1 9 9 , 4 4 1 , 3 1 01/01/2018~ 02/28/2018 5.2.2 R&D Accomplishments in 2017 Highlights ● 7nm Technology 7nm technology offers significant performance, power and density improvement compared to previous technology generations. In 2017, TSMC successfully completed 7nm technology qualification for volume production, as major customers completed IP validation and started product tape-out. Ramp-up to volume production is expected in first half of 2018. ● 5nm Technology Even though the semiconductor industry is approaching the physical limits of silicon, 5nm technology still follows MooreÕ s Law and delivers substantial density improvement with better performance at same power or lower power consumption at comparable performance. Development activities of 5nm technology in 2017 were focused on test vehicle pilot run, baseline process development, yield ramp, and transistor performance enhancement. In 2018, TSMC will continue 075 5nm full development focusing on manufacturing baseline process setup, yield learning, transistor and interconnect R/C performance improvement and reliability evaluation, targeting risk production in 2019. ● Lithography Technology The main focus for R&D lithography in 2017 is 7nm technology transfer, 5nm technology development and preparation of 5nm beyond development. For 7nm development, the technology was smoothly transferred and R&D is working with the fab to clean up the remaining patterning issues. As for 5nm development, EUV (extreme ultraviolet) lithography showed promising imaging capability with expected good wafer yield. R&D is working on EUV cost reduction, mask defect reduction in scanner, and mask-making capability improvement. In 2018, TSMC will intensively focus on improving EUV quality and adopting more EUV layers in 5nm and beyond technology. In 2017, the EUV program made continuous improvement in light-source power and its stability, which has enabled faster learning rate and process development for advanced nodes. Additional progress was made with resist process, pellicle, and related mask blanks, as EUV technology moves closer to full scale R&D and manufacturing readiness. ● Mask Technology Mask technology is an integral part of advanced lithography. In 2017, R&D successfully implemented EUV mask technology into 7nm and 5nm nodes. Solid progress was made on the production yield and the reduction of blank native defects to meet high-volume manufacturing requirements. Integrated Interconnect and Packaging Wafer Level System Integration (WLSI) is a disruptive technology that leverages TSMC’s core competency in wafer processes and capacity in building up heterogeneous system integration and packaging to meet specific customer needs in system-level performance, power, profile, cycle time and cost. WLSI and its associated technology platforms, including CoWoS®, InFO and Under-Bump-Metallurgy Free Integration (UFI), are continuously evolving to fulfill diversified customer needs in mobile computing, IoT, automotive, and high-performance computing. heterogeneous integration of a large logic chip at 16/12/7nm and a growing number of HBM2 (second generation high bandwidth memory) stacks. Consequently, the Si interposer area has grown very fast to an astonishing ~1400mm2 in some applications. TSMC continues to provide a complete Si-to-package business model for CoWoS® manufacturing. ● Advanced Fan-Out Packaging In 2017, TSMC continued to lead in high-volume manufacturing (HVM) of InFO-PoP Gen-2 packaging for mobile applications processors. During the year, the Company also successfully qualified InFO-PoP Gen-3 advanced packaging technology for mobile applications and started risk production in Integrated Fan-Out on Substrate (InFO-oS) for HPC die-partition application. The newly developed InFO-PoP could be stacked with versatile commercial DRAM with competitive performance. This InFO-PoP with backside RDL will boost penetration into mobile application processor application with wide coverage from premium to mid and low tiers. TSMC has scheduled HVM readiness by end of 2018. To meet demand with the coming of 5G mobile communications, TSMC has developed an advanced InFO antenna in package (InFO-AIP) technology, in which the RF chip and millimeter-wave antenna are integrated into an InFO package. InFO-AIP technology provides high-performance, low-power, small-size, low-cost solutions for millimeter wave system applications such as 5G mobile, video streaming and virtual reality (VR) wireless communications. This technology can also support the fast-evolving applications in car radar, auto-driving and driving safety. ● Advanced Interconnect TSMC has made significant progress in innovative materials and processes for continuous interconnect scaling. The Company has developed and verified a novel low-k process using selective deposition on dielectric, which can lower capacitance loading, improve electric performance and enhance device reliability. In addition, TSMC has developed a new barrier and copper gap filling process to further extend copper material applications and provide competitive wire conductance and via resistance for advanced technology nodes. Verification of these new materials and processes is progressing well for beyond 5nm technologies. ● 3D IC and Si Interposer Interposer CoWoS® demand is growing rapidly in the high-performance computing (HPC) area, both in volume and the number of products. Typical CoWoS® applications involve Advanced Transistor Research Innovation in transistor architectures and materials continues to enable higher speed and reduced power consumption in advanced logic technologies. TSMC is at the forefront of transistor research in areas such as high mobility channel, novel gate stack materials, and device structures for reduced operating voltage and enhanced off state control. TSMC research is well positioned to pave the way for continued density scaling, performance enhancement and power reduction to deliver advanced logic technologies for mobile and high-performance applications. Specialty Technologies TSMC offers a broad mix of technologies to address a wide range of applications: ● Mixed Signal/Radio Frequency (MS/RF) Technology In 2017, in order to facilitate circuit design for the increasing demand of 5G cutting-edge wireless technologies, TSMC successfully delivered 22nm devices with a Si-based millimeter-wave (mmWave) model to fulfill a customer’s request for transceiver design to support faster application. To achieve better performance in insertion loss and isolation, TSMC reduced the key parameter Ron-Coff to~85 fs (femtosecond) in 0.11µm process for cellar/Wi-Fi RF switch applications as a lower-cost alternative. ● Power IC/Bipolar-CMOS-DMOS (BCD) Technology TSMC’s 0.18µm third-generation BCD technology went into production in 2017. The technology provides the world’s leading performance for fast charger, wireless charger and panel Power Management IC (PMIC). TSMC continually enriches this platform to cover more PMIC applications with 40nm eFlash compatible 7-30V HV (high voltage) devices for the first time to enable low power, high integration and small footprint in mobile applications. ● Panel Drivers In 2017, TSMC completed 40nm high-voltage phase-2 technology qualification and transferred to fab. Several customers passed product qualification with good yield. This technology supports Super Retina display driver ICs in LCD, OLED and touch-display driver ICs for high-end mobile phones. For next generation HV panel display driver, TSMC plans to deliver high-speed, low active power 28HPC+ technology in both wafer-on-wafer stacking and high-voltage monolithic technologies. ● Micro-electromechanical Systems (MEMS) Technology In 2017, TSMC’s modular MEMS technology was qualified for mass production of accelerometers and a pilot run of high-resolution pressure sensors. Future plans include the development of next-generation high-sensitivity thin microphone, MEMS Si-pillar TSV (through silicon via) technology and BioMEMS applications. ● GaN Technology The next generations of 650V/100V enhanced-high electron mobility transistor (E-HEMT) and RF 30V D-MISFET GaN devices were developed and qualified for manufacturing in 2017. ● Complementary Metal-Oxide-Semiconductor (CMOS) Image Sensor Technology In 2017, TSMC had several achievements in CMOS image sensor technology including: (1) high-performance sub-micron pixel development, which was completed and made ready for mass production; (2) quantum efficiency (QE), which gained significant boost on near-infrared sensors by innovated structure and usage of new material; and (3) pitch density of wafer bond technology, which was pushed higher to maintain the Company’s world-wide leading position. ● Embedded Flash/Emerging Memory Technology TSMC achieved several major milestones in non-volatile memory (NVM) technologies in 2017. At the 40nm node, NOR-based cell technology with Split-Gate cell was successfully mass-produced to support consumer electronics applications such as IoT, smartcards and micro controller units (MCU). This technology will be incorporated in automobile electronics and mass production is expected in first half of 2018. Embedded flash development on the 28nm low-power and 28nm high-performance mobile computing platforms has demonstrated preliminary yield and reliability, and technical qualification is expected in 2019 for low-leakage applications in areas such as automobile electronics and micro controller units. TSMC is developing embedded resistive random access memory (RRAM) technology as a low-cost solution to split-gate technology, completing the 40nm technical qualification. With production expected in 2018, this technology will be mainly applied to the price sensitive IoT market. 22nm embedded resistive memory technology is also being developed. Compared to 40nm technology, 22nm embedded resistive memory unit cell area will be substantially scaled and expected to enter mass production in 2020. TSMC is also developing embedded MRAM (Magnetoresistive Random Access Memory) technology as embedded-flash technology replacement beyond 40nm node for many emerging applications. 076 077 5.2.3 Technology Platform TSMC provides customers with advanced technology platforms that include the comprehensive design infrastructure required to optimize design productivity and cycle time. These include: design flows for electronic design automation (EDA); silicon-proven IP building blocks, such as libraries; and simulation and verification design kits, i.e., process design kits (PDKs) and technology files. For TSMC’s latest advanced technologies of 7nm, 12nm and 3D IC design enablement platform, EDA tools, features and IP solutions are readily available for customers to adopt to meet their product requirements at various design stages. TSMC also extended its IP quality program (TSMC 9000) to allow IP audits to be performed either at TSMC or at TSMC-certified laboratories. To help customers plan new product tape-outs incorporating IP/Library from TSMC’s Open Innovation Platform® (OIP) ecosystem, the OIP ecosystem added a portal to connect customers to an ecosystem of 40 solution providers. Overall, TSMC and its IP partners have accumulated a portfolio of 16,000 IP titles, from 0.35µm-7nm with major IP types to meet customer design needs. TSMC and its EDA partners have created numerous deliverables from 0.13µm-7nm that have successfully supported customer tape-outs. 5.2.4 Design Enablement TSMC’s technology platforms provide a solid foundation to facilitate the design process. Customers can design directly using the Company’s internally developed IP and tools or using those that are available from TSMC’s OIP partners. Tech Files and PDKs EDA tool certification is an essential foundation for IP and customer designs to ensure that the features meet TSMC process technology requirements, with certification results that can be found on TSMC-Online. There are corresponding technology files and process development kits (PDKs) available for customers to download and design together with certified EDA tools. TSMC provides a broad range of PDKs for digital logic, mixed-signal, radio frequency (RF), high-voltage driver, CMOS image sensor (CIS) and embedded flash technologies across a range of technology nodes from 0.5µm to 7nm. In addition, the Company provides technology files for design rule checking (DRC), layout verification of schematic (LVS), resistance-capacitance (RC) extraction, automatic place and route, and a layout editor to ensure process technology information is accurately represented in electronic design automation tools. By 2017, TSMC had provided more than 9,000 technology files and more than 300 PDKs via TSMC-Online. There are more than 100,000 customer downloads of these files every year. Library and IP Silicon Intellectual property (IP) is the basic building block of integrated circuit designs. Various IP types are available to support different customer design applications including foundation IP, analog IP, embedded memory IP, interface IP and soft IP. TSMC and its alliance partners offer customers a rich portfolio of reusable IPs, which are essential building blocks for many circuit designs. In 2017, the Company expanded its library and silicon IP portfolio to contain more than 16,000 items, a 33% increase over 2016. Design Methodology and Flow Reference flows are built on top of certified EDA (Electronic Design Automation) tools to provide additional design flow methodology innovations that can help boost productivity. In 2017, TSMC addressed critical design challenges associated with the new 7nm+, 12nm FinFET and 3DIC technology for digital and SoC applications by announcing the readiness of reference flows through OIP collaboration that feature FinFET-specific design solutions and methodologies for performance, power and area optimization. 5.2.5 Intellectual Property A strong portfolio of intellectual property rights strengthens TSMC’s technology leadership and protects our advanced and leading-edge technologies. As of end of 2017, TSMC has accumulated over 40,000 patent applications, and over 30,000 patent grants worldwide. In 2017, TSMC has obtained 2,428 U.S. patents to rank #9 among U.S. patent assignees, making the ranking of top 10 U.S. patent assignees for the second consecutive year. Additionally, TSMC actively develops worldwide patent strategy, ranking #1 among patent applicants in Taiwan, and obtaining over 1,100 patents in Taiwan and China. In terms of patent quality, the average allowance rate of TSMC’s U.S. applications is 98% and ranks #1 among top 10 U.S. patent assignees. Going forward, TSMC will continue to implement a unified strategic plan for intellectual capital management, combining with strategic considerations and close alignment with the business objectives, to drive the timely creation, management and use of intellectual property. TSMC has established a process to generate company value from intellectual property by aligning intellectual property strategy with R&D, business operation objectives, marketing, and corporate development strategies. Intellectual property rights protect the company’s freedom to operate, enhance competitive position, and provide leverage to participate in many profit-generating activities. TSMC has worked continuously to improve the quality of intellectual property portfolio and to reduce the maintenance costs. TSMC will continue to invest in intellectual property portfolio and intellectual property management system to ensure the company’s technology leadership and receive maximum business value from intellectual property rights. 5.2.6 TSMC University Collaboration Programs In recent years TSMC has significantly expanded its collaboration on research projects at some of Taiwan’s most prestigious universities. The mission of these projects is twofold: to increase the number of highly qualified students suitable for employment in the semiconductor industry, and to inspire university professors to initiate research programs that focus on the frontiers of semiconductor science, including device, process and materials technology, semiconductor manufacturing and engineering science, and specialty technologies for electronic applications. In the past five years, TSMC has established research centers at four institutions: National Chiao Tung University, National Taiwan University, National Cheng Kung University and National Tsing Hua University. In 2015, TSMC started collaborating with the International College of Semiconductor Technology, National Chiao Tung University and continued to enhance cooperation with other schools. Currently, several hundred high-caliber students have joined the research centers with backgrounds in the disciplines of electronics, physics, materials, chemistry, chemical engineering and mechanical engineering. In addition, TSMC also conducts strategic research projects at top overseas universities, such as Stanford, MIT, UC Berkeley and so on. The focus is on disruptive capabilities in transistors, interconnect, patterning, modeling and special technologies. TSMC University Shuttle Program The TSMC University Shuttle Program was established to provide professors at leading research universities worldwide with access to the advanced silicon process technologies needed to research and develop innovative circuit design concepts. This program links motivated professors and graduate students with enthusiastic managers at TSMC in order to promote excellence in the development of advanced silicon design technologies and nurture new generations of engineering talent in the semiconductor field. The program provides access to TSMC silicon process technologies for digital and analog/mixed-signal circuits, RF designs and micro-electromechanical system designs. Participants include major university research groups worldwide. TSMC and the University Shuttle Program participants achieve “win-win” collaboration through the program, which allows graduate students to implement exciting designs and achieve silicon proof points for innovations in various end-applications. 5.2.7 Future R&D Plans To maintain and strengthen TSMC’s technology leadership, the Company plans to continue investing heavily in R&D. For advanced CMOS logic, the Company’s 7nm and 5nm CMOS nodes continue progressing in the pipeline. In addition, the Company’s reinforced exploratory R&D work is focused on beyond-5nm node; in areas such as 3D transistors, new memory, and low-R interconnect, on track to establish a solid foundation to feed into technology platforms. For 3D IC advanced packaging, innovations for energy-efficient sub-system integration and scaling provide further augmentation to CMOS logic applications. For specialty technologies, the Company has intensified focus on new specialty technologies such as RF and 3D intelligent sensors targeting 5G and smart IoT applications. In 2017, a new Corporate Research function is established to focus on novel materials, process, devices, nanowires, memories, and etc. for long term horizon which is beyond 8-10 years. The Company also continues to collaborate with external research bodies from academia to industry consortia alike with the goal of extending Moore’s Law and paving the road to future cost-effective technologies and manufacturing solutions for its customers. With a highly competent and dedicated R&D team and its unwavering commitment to innovation, TSMC is confident in its ability to deliver the best and most cost-effective SoC technologies to its customers and to drive future business growth and profitability for years to come. 078 079 Summary of TSMC’s Major Future R&D Projects Project Name Description Risk Production (Estimated Target Schedule) 5nm logic platform technology and applications Beyond-5nm logic platform technology and applications 3D IC Next-generation lithography Long-term research 5th generation FinFET CMOS platform technology for SoC 6th generation FinFET CMOS platform technology for SoC Cost-effective solution with better form factor and performance for System-in- Package (SiP) EUV lithography and related patterning technology to extend Moore’s Law Specialty SoC technology (including new NVM, MEMS, RF, analog) and transistors for 8-10 year out horizon 2019 2021 2018-2020 2018-2020 2018-2025 The projects above account for roughly 70% of the total R&D budget for 2018, estimated to be around 8% of 2018 revenue. 5.3 Manufacturing Excellence 5.3.1 GIGAFAB® Facilities Maintaining dependable capacity is a key part of TSMC’s manufacturing strategy. The Company currently operates three 12-inch GIGAFAB® facilities – Fabs 12, 14 and 15. The combined capacity of the three facilities exceeded 7 million 12-inch wafers in 2017. Production within these three facilities supports 0.13µm, 90nm, 65nm, 40nm, 28nm, 20nm, 16nm, 10nm, and 7nm process technologies, including each technology’s sub-nodes. An additional portion of the capacity is reserved for R&D work on leading-edge manufacturing technologies, which currently supports the technology development of the 5nm node and beyond. TSMC has developed a centralized fab manufacturing management system, Super Manufacturing Platform (SMP), to provide customers with greater benefits in the form of more consistent quality and reliability, improved flexibility to cope with demand fluctuations, faster yield learning and time-to-volume, and lower-cost product requalification. 5.3.2 Engineering Performance Optimization As advanced technology continues to evolve and the geometry keeps shrinking, the need for tighter process control has become extremely challenging for manufacturing. TSMC’s unique manufacturing infrastructure is tailored for a diversified product portfolio, which uses strict process control to attain tightened specs and higher product quality and product performance requirements. To achieve overall optimization of equipment, process and yield, the process control and analysis systems have been integrated with many intelligent functions to perform self-diagnosis and self-reaction, which have demonstrated remarkable results in yield enhancement, workflow improvement, fault detection, cost reduction and shortening of the R&D cycle. TSMC has developed systems for precise fault detection and classification, intelligent advanced equipment control and intelligent advanced process control to monitor the manufacturing process in a timely manner and adjust conditions precisely. To satisfy advanced and accurate process control and ensure highly efficient and effective production, the Company has created precision equipment matching and yield mining to minimize process variation and potential yield loss. The Company has further developed Big Data, Machine Learning, and Artificial Intelligence architecture to identify critical variables to optimize yield management and operating efficiency to fulfill special process requirements such as automotive products and to cope with diversified product demand simultaneously. 5.3.3 Agile and Intelligent Operations The Company’s sophisticated agile operation system continues to drive manufacturing excellence by integrating demand and capacity modeling, lean Work in Process (WIP) line management, and lot dispatching and scheduling to provide fast ramp-up, short cycle time, stable manufacturing and on-time delivery. The system also provides great flexibility to quickly support customers’ urgent pull-in requests when needed. TSMC has also introduced new applications such as IoT, intelligent mobile devices and mobile robots to consolidate data collection, yield traceability, workflow efficiency, and material transportation to continuously enhance fab operation efficiency. Following its commitment to manufacturing excellence, TSMC has integrated automatic manufacturing system and machine learning technology, and then achieve intelligent fabs. Machine learning technology revolutionizes fab operation mode from “auto” to “intelligent”, and widely applied in scheduling and dispatching, people productivity, equipment productivity, process and equipment control, quality defense, and robotic control. So as to optimize efficiency, flexibility and quality while maximizing cost effectiveness and accelerating overall innovation. 5.3.4 Raw Materials and Supply Chain Management In 2017, TSMC continued to review and resolve supply issues, quality issues and potential supply chain risks through the collaboration of teams formed by operations, quality control and business organizations. TSMC also worked with suppliers to advance material and process innovation, improve quality and create recycling economy with benefits from win-win solutions. Raw Materials Supply Major Materials Major Suppliers Market Status Procurement Strategy Raw Wafers F.S.T. GlobalWafers S.E.H. Siltronic SUMCO Chemicals Lithographic Materials Gases Slurry, Pad, Disk Air Liquide Avantor BASF Entegris Fujifilm Electronic Materials Kanto PPC Kuang Ming Merck RASA Tokuyama Versum Wah Lee 3M Asahi Kasei Dow Chemical Fujifilm Electronic Materials JSR Merck Nissan Shin-Etsu Chemical Sumitomo T.O.K. Air Liquide Air Products Central Glass Entegris Linde LienHwa Praxair SK Materials Taiwan Material Technology Taiyo Nippon Sanso Versum 3M Cabot Microelectronics Dow Chemical Fujibo Fujifilm Electronic Materials Fujimi JSR Kinik Versum These 5 suppliers together provide over 90% of the world’s raw wafer supply. ● TSMC’s suppliers of silicon wafers are required to pass stringent quality certification procedures. Each supplier has multiple manufacturing sites in order to meet customer demand, including plants in North America, Asia, and Europe. World-wide demand for raw wafer has remained strong through 2017 and expected to continue in 2018. ● TSMC procures wafers from multiple sources to ensure adequate supplies for volume manufacturing and to appropriately manage supply risk. ● Raw wafer quality enhancement programs are in place to support TSMC’s technology advancement. ● TSMC regularly reviews the quality, delivery, cost, sustainability and service performance of its wafer suppliers. The results of these reviews are incorporated into subsequent purchasing decisions. ● A periodic audit of each wafer supplier’s quality assurance system ensures that TSMC can maintain the highest quality in its own products. ● TSMC takes various approaches with suppliers to better manage the cost and supply. These 12 companies are the major worldwide suppliers of chemicals. ● Most suppliers have relocated some of their operations closer to TSMC’s major manufacturing facilities, thereby significantly improving procurement logistics. ● All supplied products are regularly reviewed to ensure that TSMC’s specifications are met and product quality is satisfactory. ● TSMC encourages and engages with chemical suppliers to implement innovative green solutions for waste reduction These 10 companies are the major worldwide suppliers of lithographic materials. ● TSMC works closely with suppliers to develop materials that meet all application and cost requirements. ● TSMC and suppliers periodically conduct programs to improve their quality, delivery, sustainability and green policy, and to ensure continuous progress of TSMC’s supply chain. ● Some major suppliers have relocated or plan to replicate their manufacturing sites closer to TSMC’s major manufacturing facilities, thereby significantly improving procurement logistics and reducing supply risks. These 10 companies are the major worldwide suppliers of specialty gases. ● The majority of these suppliers have facilities in multiple geographic locations, which minimizes supply risk for TSMC. ● TSMC conducts periodic audits to ensure that they meet TSMC’s standards. These 9 companies are the major worldwide suppliers of CMP (Chemical Mechanical Polishing) materials. ● TSMC works closely with suppliers to develop materials that meet all application and cost requirements. ● TSMC and suppliers periodically conduct programs to improve their quality, delivery, sustainability and green policy, and to ensure continuous progress of TSMC’s supply chain. ● Most suppliers have relocated or plan to replicate some of their manufacturing sites closer to TSMC’s major manufacturing facilities, thereby significantly improving procurement logistics and reducing supply risks. 080 081 Suppliers Accounted for at Least 10% of Annual Consolidated Net Procurement Unit: NT$ thousands Supplier Company A Company B VIS Company C Company D Company E Others Total Net Procurement 2017 2016 Procurement Amount As % of 2017 Total Net Procurement Relation to TSMC Procurement Amount As % of 2016 Total Net Procurement Relation to TSMC 8,868,953 8,029,455 5,755,727 5,579,238 5,156,154 37,707 19,766,419 53,193,653 17% None 15% None 11% Investee accounted for using equity method 10% None 10% None 0% None 37% 100% 9,140,880 7,065,392 6,732,297 3,785,553 3,832,363 5,527,526 16,100,032 52,184,043 17% None 14% None 13% 7% 7% Investee accounted for using equity method None None 11% None 31% 100% 5.3.5 Quality and Reliability TSMC’s strong industry reputation stems from its commitment to provide customers with the highest-quality wafers and best service for their products. Quality and Reliability (Q&R) services aim to achieve “quality on demand” to fulfill customers’ requirements for time-to-market delivery, product reliability, and competitiveness over a broad range of product market segments. Automotive quality improvement program is implemented to meet automotive customers’ low Defect Parts Per Million (DPPM) requirement. Q&R technical services assist customers in the technology developmental stages and product design stages to design-in superior product reliability. In 2017, Q&R has worked with R&D in advanced logic technology, specialty technology and advanced packaging technology development and qualification. Q&R has successfully qualified the leading-edge 7nm technology (the third FinFET generation) and characterized process window with Fab for mass production in 2018. TSMC has led the industry in 7nm technology qualification and built up a complete model to simulate thermal dissipation effect during FinFET operation. In addition, Electronic Design Automation (EDA) tool for thermal simulation has been introduced to provide design guidance to customers. Through the 7nm development, profound reliability learning in new material, new process steps and new reliability methodology provided important foundation for 5nm technology development. For specialty technologies, Q&R completed the Diffractive Optical Element (DOE) product qualification and ramp into mass production on schedule to support one of our key customer’s new product launch with 3D sensing and facial recognition application, and the DOE units were shipped to our customer. In addition, Q&R worked with customers to complete stacked CMOS Image Sensor (CIS) Column Level Hybrid Bond (CLHB) process/product qualification and successfully shipped to customers in 2017. In high-voltage technologies, 0.13µm Bipolar-CMOS-DMOS (BCD) and 0.18µm second generation BCD process passed automotive grade qualification. For CoWoS® packaging technologies, Q&R integrated High Bandwidth Memory with advanced silicon technology and completed component level, board level and customer product system level qualifications. It has been in production and has shipped to key customers without quality or reliability issues. The technology enables the applications of High Performance Computing and Artificial Intelligence. In addition, Integrated Fan-Out (InFO) assembly technology for mobile application has been moving into the second generation of manufacturing. Over 100 million InFO devices have been shipped without any InFO related quality or reliability issues. To enhance employees’ problem solving capabilities and develop associated quality system and methodology, Q&R continued to hold several company-wide symposiums and training programs such as Total Quality Excellence (TQE), Design of Experiment (DOE), Statistical Process Control (SPC) and Metrology in 2017 including the promotion and training of Deep/Machine Learning. Deep machine learning methodology was successfully applied for wafer defects automatic classification and advanced spectral analysis to detect differences among processes and equipment such that improvement actions can be triggered. In 2018, Q&R will continue the development of employees’ capabilities by promoting and using new methodology to enhance TSMC competitiveness. In response to raw materials quality improvement, Q&R coached raw materials suppliers to participate in the 2017 National Quality Control Circle Competition and achieved good results. Through this activity, quality improvement and competitiveness enhancement were thus promoted. In the ramping of leading edge technologies, one of the most challenging tasks in electrical failure analysis (EFA), is to determine the physical location of which one among the millions of transistors in a chip is causing the failure. In 2017, Q&R acquired industry leading capability in this area that is not only suitable for 7nm technology but is extendable to 5nm technology node. The health and safety of employees has always been a priority in TSMC. In 2017, raw materials suppliers were required to provide non-PFOA (Perfluorooctanoic acid) raw materials to replace the existing PFOA-containing raw materials to fulfill the green procurement policy. Since the end of 2015, Q&R has collaborated with Environmental Safety and Health (ESH) organization to build capability to detect and analyze carcinogenic, mutagenic and reprotoxic (CMR) substances. In 2017, TSMC also continued to invest in safety equipment such as better hoods and exhausts to improve the laboratory environment in which TSMC employees work. Q&R is also responsible for leading the Company toward the ultimate goal of zero-defect production through the use of continuous improvement programs. Periodic customer feedback indicates that products shipped from TSMC have consistently met or exceeded their field quality and reliability requirements. In 2017, a third-party audit verified the effectiveness of TSMC quality management systems in compliance with IATF 16949: 2016 and IECQ QC 080000: 2012 certificates requirements. In addition, Q&R and Fabs have jointly worked on new enhancement for automotive product quality improvement including design rule implementation and migration to Automotive Quality System 2.0 in 2017 which covers Fab in-line and Wafer Acceptance Test Cpk (process capability index) tightening and maverick wafers/lots handling. Q&R also provides dedicated resources for field/line return analysis, timely physical failure analysis (PFA) for process improvement to meet automotive customers’ low DPPM requirement. 5.4 Customer Trust 5.4.1 Customers TSMC’s customers worldwide have a variety of successful product specialties and excellent performance records in various segments of the semiconductor industry. Customers include fabless semiconductor companies, systems companies, and integrated device manufacturers such as Advanced Micro Devices, Inc., Bitmain Technologies Limited, Broadcom Limited, Hisilicon Technologies Co. Ltd, Intel Corporation, Marvell Technology Group Ltd., MediaTek Inc., NVIDIA Corporation, NXP Semiconductors N.V., Qualcomm Inc., Sony Corporation, Texas Instruments Inc., and many more. Customer Service TSMC believes that providing superior service is critical to enhancing customer satisfaction and loyalty, which, in turn, is very important to retaining existing customers, strengthening customer relationships and attracting new customers. With a dedicated customer service team as the main contact for coordination and facilitation, TSMC strives to provide world-class design support, mask making, wafer manufacturing, and backend services to provide customers an optimum experience and, in return, gain customer trust and sustain Company revenues and profitability. To facilitate customer interaction and information access on a real-time basis, TSMC-Online offers a suite of web-based applications that play an active role in design, engineering and logistics collaborations. Customers have 24/7 access to critical information and customized reports. Design collaboration focuses on content availability and accessibility, with close attention paid to complete, accurate and up-to-date information at each stage of the design life cycle. Engineering collaboration includes online access to engineering lots, wafer yields, wafer acceptance test (WAT) analysis, and quality and reliability data. Logistics collaboration provides access to data on any given order status in wafer fabrication, backend process and shipping. Customer Satisfaction To measure customer satisfaction and to ensure that customer needs are fully understood, TSMC conducts an annual customer satisfaction survey (ACSS) with most active customers, either by web or interview through an independent consultancy. 082 083 Complementary to the survey, quarterly business reviews (QBRs) are also conducted by the customer service team so that customers can give feedback to TSMC on a regular basis. Through surveys, feedback reviews and intensive interaction with customers, TSMC is able to stay in close touch for better service and collaboration. ● the foundry segment’s largest, most comprehensive and robust silicon-proven IP (intellectual properties) and library portfolio; and by actively encouraging employees to nurture and enjoy a healthy family life, to develop outside interests, to expand social participation, and, in general, live a happy life. Customer feedback is routinely reviewed, analyzed and then used to develop appropriate improvement plans, all in all becoming an integral part of the customer satisfaction process with a complete closed loop. TSMC uses data derived from the survey as a base to identify future focus areas. TSMC acts on the belief that customer satisfaction leads to healthy relationships, and healthy relationships lead to higher levels of retention and expansion. Customers that Accounted for at Least 10% of Annual Consolidated Net Revenue Unit: NT$ thousands Customer Customer A Customer B Others Total Net Revenue 2017 2016 Net Revenue As % of 2017 Total Net Revenue Relation to TSMC Net Revenue As % of 2016 Total Net Revenue Relation to TSMC 214,228,766 64,096,227 699,122,248 977,447,241 22% None 7% None 71% 100% 157,185,418 107,463,238 683,289,688 947,938,344 17% None 11% None 72% 100% 5.4.2 Open Innovation Platform® (OIP) Initiative Innovation has always been an exciting and challenging proposition. Competition among semiconductor companies continues to grow more intense in the face of increasing customer consolidation and the commoditization of technology at more mature, conventional levels. Companies must find ways to keep innovating in order to survive and prosper. One way to accelerate innovation is through active collaboration with external partners. At TSMC this is known as the “Open Innovation® approach” and it is an “outside in” approach to complement traditional “inside out” methods. TSMC has adopted this path to innovate via its Open Innovation Platform® initiative, which is a key part of the TSMC Grand Alliance. The OIP initiative is a comprehensive design technology infrastructure that encompasses all critical IC implementation areas to reduce design barriers and improve first-time silicon success. OIP promotes the speedy implementation of innovation amongst the semiconductor design community and its ecosystem partners using TSMC’s IP, design implementation and design for manufacturability (DFM) capabilities, process technology and backend services. Crucial to OIP are ecosystem interfaces and collaborative components initiated and supported by TSMC that more efficiently empower innovation throughout the supply chain and, in turn, drive the creation and sharing of new revenue and profits. TSMC’s active accuracy assurance (AAA) initiative is key to OIP, providing the accuracy and quality required by the ecosystem interfaces and collaborative components. TSMC’s Open Innovation® model brings together the creative thinking of customers and partners under the common goal of shortening each of the following: design time, time-to-volume, time-to-market and, ultimately, time-to-revenue. The model features: ● the foundry segment’s earliest and most comprehensive electronic design automation certification program, delivering timely design tool enhancement required by new process technologies; ● comprehensive design ecosystem alliance programs covering market-leading EDA, library, IPs, and design service partners. TSMC’s OIP alliance consists of 21 EDA partners, 40 IP partners, and 23 design service partners. TSMC and its partners work together proactively and engage much earlier and deeper than before in order to address mounting design challenges at advanced technology nodes. Through this early and intensive collaboration effort, TSMC’s OIP is able to deliver the needed design infrastructure with timely enhancement of EDA tools, early availability of critical IPs and quality design services when customers need them. Taking full advantage of the process technologies once they reach production-ready maturity is critical to customers’ success. TSMC’s OIP partner management portal facilitates communication with our ecosystem partners for efficient business productivity. Designed with a highly intuitive interface, this portal can be accessed via a direct link from TSMC-Online. TSMC held its 2017 Open Innovation Platform® Ecosystem Forum in September in Santa Clara, California with over 1,300 attendees. The annual event demonstrates how TSMC and our ecosystem partners jointly develop design solutions on top of TSMC’s advanced technologies through OIP collaboration. TSMC executive delivered key messages to help customer products’ time-to-market. TSMC has expanded design ecosystem solutions to address market demands with four application specific design platforms consisting of Mobile, High Performance Computing (HPC), Internet of Things and Automotive. In addition, TSMC continues to enhance 3DIC solutions to integrate high bandwidth memory (HBM) on integrated fan-out design flow to meet customers’ system integration and high memory bandwidth requirements. Furthermore, machine learning is being leveraged to enhance customers’ design power, performance and area (PPA) and productivity. 5.5 Human Capital TSMC believes that all employees, including contractors, and interns, should be treated with dignity and respect. Reflecting this commitment to employees, the Company has implemented a “TSMC Human Rights Policy,” which is based on “the International Bill of Human Rights,” “The International Labour Organization’s (ILO) Declaration on Fundamental Principles and Rights at Work” and “The United Nations Global Compact’s Ten Principles,” and adopts Responsible Business Alliance (RBA) Code of Conduct. TSMC participates in the Responsible Business Alliance, RBA as a full member; the Company refrains from forcing employees to do unwilling labor service, listens to the employees, keeps communication channels open, respects employees’ right to form a labor union, and does not in any way impede employees’ freedom of association. 5.5.1 Workforce Structure At the end of 2017, TSMC had 48,602employees worldwide, including 5,107 managers, 21,895 professionals, 4,082 assistants, and 17,518 technicians. The following table summarizes TSMC’s workforce as of the end of February, 2018: 12/31/2016 12/31/2017 02/28/2018 Job Total Gender Education Managers Professionals Assistant Engineer/Clerical Technician Male (%) Female (%) Ph.D. Master’s Bachelor’s Other Higher Education High School 4,909 20,719 3,934 17,406 46,968 59.9% 40.1% 4.5% 40.3% 26.7% 11.6% 16.9% 35.2% 7.9% 5,107 21,895 4,082 17,518 48,602 60.7% 39.3% 4.6% 41.5% 26.3% 11.4% 5,150 21,913 4,102 17,445 48,610 60.8% 39.2% 4.7% 41.6% 26.2% 11.4% 16.2% 16.1% 35.7 8.4 35.8 8.5 Human capital is TSMC’s most treasured asset. In this regard, the Company’s main role is to provide jobs with challenging, meaningful work in a safe environment with excellent compensation and benefits. TSMC goes beyond this, however, Average Years of Age Average Years of Service 084 085 5.5.2 Recruitment The key elements of TSMC’s success and growth depend on our employee who shares common goals and interests. In order to strengthen growth momentum, the Company is dedicated to recruiting top-notch professionals for all positions available. TSMC is an equal opportunity employer and operates on the principles of open and fair recruitment. The hiring principals are integrity and ability, and the Company evaluates all candidates according to their qualifications as related to the requirement of each position without regard to race, gender, age, religion, nationality or political affiliation. TSMC’s continuous growth requires constant talent sourcing and recruitment activities to support its business. The Company recruited more than 3,600 employees in 2017, including over 2,500 managers and professionals, as well as over 1,000 assistants and technicians. 5.5.3 People Development Employee development is an integral and critical factor for the growth of any company and should be goal oriented, disciplined and planned. TSMC is committed to stretching employees’ potential by providing challenging work, global workplace and internal rotation opportunities. TSMC also committed to cultivating a consistent and diverse learning environment. To this end, the Company has initiated the “TSMC Employee Training and Education Procedure” to ensure the Company’s and the individuals’ development objectives can be achieved through the integration of internal and external training resources. In order to actively develop talent and create a high-performance work environment, TSMC integrates internal and external resources and designs diversified development programs based on business objectives, the nature of the individual’s job, work performance and career development path. The Company provides employees a diverse network of learning resources, including on-the-job training, classroom training, e-learning, coaching, mentoring and job rotation; it also creates an educational atmosphere through learning activities in response to organization development requirements and employee capability enhancement goals. The Company provides employees with a wide range of onsite general, professional and management training programs. In addition to engaging external experts as trainers, hundreds of TSMC employees are trained to be qualified instructors to deliver their valuable knowhow in internal training courses. TSMC’s training programs include: ● New employee – for basic training and job orientation. In addition, newcomers’ managers and the Company’s well-established buddy system are in place to support new hires in their assimilation process in both corporate culture and work requirements. ● General – refers to training required by government regulations and/or Company policies, as well as training on general subjects for all employees or employees of different job functions. Topics include industry-specific safety, workplace health and safety, quality, fab emergency response and personal effectiveness. ● Professional/functional – technical and professional training required by different functions within the Company. TSMC offers training courses on equipment engineering, process engineering, accounting, information technology, and so forth. ● Management – management development programs tailored to the needs of managers at all levels based on their managerial capabilities and responsibilities, including new, experienced, and senior managers; optional courses are also available. ● Direct labor – training for production-line employees to acquire the knowledge, skills and approaches they need to perform their jobs well and to pass certification for operating equipment. Includes direct labor skill training, technician “Train the Trainer” training, and manufacturing leader training. ● Customized – programs tailored to the needs of the organization and/or the employee’s development plan. In 2017, TSMC conducted 973 internal training sessions, which translated to a companywide total of 627,063 training hours with the participation of 539,334 attendees. Employees on average attended over 13 hours of training with total training expenses reaching NT$63,277,222. Apart from internal training resources, our employees are also subsidized when pursuing external short-term courses, for-credit courses and degrees. 5.5.4 Compensation Employment at TSMC entitles employees to a comprehensive compensation and benefits program above the industry average. TSMC provides a diversified compensation program that is competitive externally, fair internally, and adapted locally. TSMC adheres to the philosophy of sharing wealth with employees in order to attract, retain, develop, motivate and reward talented employees. With sound business results for the past 30 years, the actual total compensation received by employees has also been above the industry’s average. TSMC’s compensation program includes a monthly salary, employee cash bonuses based on quarterly business results, and an employee profit sharing bonus based on annual profits. The purpose of the employee cash bonus and profit sharing bonus programs is to reward employee contributions appropriately, to encourage employees to work consistently toward ensuring the success of TSMC, and to align employees’ interests with those of TSMC’s shareholders so as to achieve win-win among the Company, shareholders and employees. The Company determines the amount of the cash bonus and profit sharing bonus based on operating results and industry practice in the Republic of China. The amount and distribution approach of the employee cash bonus and profit sharing bonus are recommended by the Compensation Committee to the Board of Directors for approval. Individual rewards are based on each employee’s job responsibility, contribution and performance. The same philosophy applies to TSMC’s compensation programs of overseas subsidiaries. In addition to providing employees of TSMC’s overseas subsidiaries with a locally competitive base salary, the Company grants annual bonuses as a part of total compensation. The annual bonuses are granted in line with local regulations, market practices, and the overall operating performance of each subsidiary, to encourage employee commitment and development with the Company. 5.5.5 Employee Engagement The Company encourages employees to maintain a healthy and well-balanced life while pursuing their goals effectively. TSMC continuously facilitate employee communication, and provide employee caring, benefit, rewards and recognition programs, including: Employee Communication TSMC values two-way communication and is committed to keeping communication channels open and transparent for the management, subordinates and peers. To ensure that employees’ opinions and voices are heard and their issues are addressed effectively, impartial submission mechanisms, including quarterly labor-management communication meetings, are in place to provide fair and timely support. TSMC makes continuous efforts to facilitate mutual and timely employee communication, based on multiple channels and platforms, which in turn fosters harmonious labor relations and creates a win-win situation for the Company and employees. A host of two-way communication channels are constructed to maintain the free flow of information between managers and employees, including: ● Communication meetings for various levels of managers and employees. ● Periodic employee satisfaction surveys, with follow-up actions based on the survey findings. ● The employee portal, myTSMC, an internal website featuring the Chairman’s talk, corporate messages, executive interviews, and other activities of interest to employees. ● eSilicon Garden, a website hosting TSMC’s internal electronic publications providing real-time updates on major activities of the Company, as well as inspirational content featuring outstanding teams and individuals. ● The whistleblower reporting system administered by the audit committee and the ombudsman system led by an appointed vice president – two distinct channels, each with strict confidentiality – to handle complaints regarding major management, financial, auditing, ethics and business conduct issues. ● The employee opinion box, which provides an opportunity for employees to submit suggestions or opinions regarding their work and the overall work environment. ● The Fab Caring Circle in each fab addresses the issues related to employees’ work and personal life; the system is dedicated mainly to the Company’s direct labor workers. 086 087 TSMC Internal Communication Structure Face-to-Face Meeting ● Functional/Work Unit/Skip-Level Meeting ● Announcement ● Fab/Functional Activity For example: Labor-Management Meeting, Chairman’s Executive Communication Meeting, Functional/Monthly Meeting, etc. Managers of All Levels Employees Employee Portal Employee Survey HR Area Service Team Communication Meeting eSilicon Garden Announcement Company-Wide Activity Human Resources Board of Directors and Management Team Employee Voice Channels ● Ombudsman System ● Internal Audit Committee ● Sexual Harassment Investigation Committee ● Employee Opinion Box ● Fab Caring Circle System/ Committee Chair TSMC has many internal communication channels, a major reason why the relationship between management and employees has been harmonious these years. The Company respects the employees’ right to form a labor union, however, no employees have pursued this avenue or issued a request to form one so far. In 2017 and in 2018 as of the date of this annual report, there have been no losses resulting from labor disputes. Employee Benefit Programs ● Convenient onsite services: cafeterias, laundry services, convenience stores, travel, banking, and commuting assistance are accessible for employees in the fabs. ● Comprehensive health enhancement and management programs: health enhancement programs include weight control, in-fab clinic and dentist services, smoking cessation, massage service, cancer screening activity, blood donation, as well as monthly seminars to raise personal health awareness. Health management programs include post health-exam follow-up activities for abnormal cases, prevention of cerebrovascular disease, ergonomic hazards management, and maternal care and protection. Employee assistance programs include five free annual counseling sessions for mental health and financial/legal issues, with extensions available depending on the individual’s needs. ● Diverse employee welfare programs: including 78 hobby clubs, 70 speeches covering various topics, Sports Day, and Family Day. In addition, holiday bonuses, marriage bonuses, condolence allowances and emergency subsidies are also available to address employees’ needs. ● Premium sports centers: a variety of workout facilities available to all employees and their families, as well as exercise sessions conducted by professional instructors to improve employee wellness. ● Flexible preschool service: childcare service, operated to meet employees’ work schedules, is available in four fabs in Hsinchu, Taichung, and Tainan. Employee Recognition TSMC sponsors various internal award programs to recognize outstanding achievements by employees, both individual and at a team level. With these award programs, TSMC aims to encourage continued employee development, which, in turn, adds to the Company’s competitive advantage. TSMC’s award programs include: ● TSMC Medal of Honor: recognizes those who contribute significantly to the Company’s business performance. ● TSMC Academy: recognizes outstanding TSMC scientists and engineers whose individual technical capabilities make significant contributions to the Company. ● TSMC Excellent Labor Award: recognizes TSMC technicians and group leaders whose outstanding performances make significant contributions to the Company. ● Total Quality Excellence Award for each fab: recognize employees’ continuous efforts in creating value for the Company. ● Service Award and TSMC’s appreciation of senior employees: recognize senior employees’ long-term commitment and dedication to the Company. ● Excellent Instructor Award: praises the outstanding performance and contribution of the Company’s internal instructors in training courses for employees. ● Function-wide awards dedicated to innovation, such as the Idea Forum and TQE Awards, which recognize employees’ initiative and continuous implementation of innovative practices. Apart from corporate-wide awards, TSMC encourages and recommended employees to participate in external talent activities and competitions. In 2017, distinguished TSMC employees continued to be recognized through a host of national awards, including National Model Labor Award, Distinguished Engineers Award, Outstanding Young Engineer Award, and National Manager Excellence Award. 5.5.6 Retention Employees’ overall satisfaction with the Company’s efforts are reflected in the 2016 TSMC Core Values Survey, which is held biennially in which 97% of participants agreed that they are willing to commit fully in their work to make TSMC an even more successful company; while 95% concurred with the statement that they are willing to contribute their talents to TSMC and grow together with the Company for the next five years. In 2017, the Company recorded a manageable turnover rate of 4.2%. Although a bit lower than healthy employee outflow defined as 5% to 10%, the Company is still in continuous growth mode and the total number of new staff 3,600 accounts for 7.5% of all employees, making the organization stay energized. 5.5.7 Retirement Policy TSMC’s retirement policy is set according to Republic of China laws as well as to the local labor standards and labor pension practices of various respective regions. With the Company’s sound financial system, TSMC ensures employees solid pension contributions and payments, which encourages employees to set long-term career plans and further deepens their commitment to TSMC. 5.6 Material Contracts Research and Development Funding Agreement Term of Agreement: 10/31/2012 - 12/31/2017 Contracting Party: ASML Holding N.V. (ASML) Summary: TSMC shall provide EUR276 million to ASML’s research and development programs from 2013 to 2017. Note: TSMC is not currently party to any other material contract, other than contracts entered into in the ordinary course of our business. The Company’s “Significant Contingent Liabilities and Unrecognized Commitments” are disclosed in Annual Report section (II), Financial Statements, page 71-72. 088 089 090 090 091 091 6. Financial Highlights and Analysis 6.1 Financial Highlights 6.1.1 Condensed Balance Sheet Condensed Balance Sheet from 2013 to 2017 (Consolidated) (Note 1) Unit: NT$ thousands Item Current Assets Long-term Investments (Note 2) Property, Plant and Equipment Intangible Assets Other Assets (Note 3) Total Assets Current Liabilities Before Distribution After Distribution Noncurrent Liabilities Total Liabilities Before Distribution After Distribution Equity Attributable to Shareholders of the Parent Capital Stock Capital Surplus Retained Earnings Before Distribution After Distribution Others Equity Attributable to Shareholders of the Parent Before Distribution After Distribution Noncontrolling Interests Total Equity Before Distribution After Distribution 2013 2014 (Adjusted) 2015 2016 2017 358,486,654 626,565,639 746,743,991 89,183,810 30,056,279 34,993,583 817,729,126 46,153,916 857,203,110 41,569,074 792,665,913 818,198,801 853,470,392 997,777,687 1,062,542,322 11,490,383 11,228,217 13,531,510 6,696,857 14,065,880 8,244,452 14,614,846 10,179,727 14,175,140 16,371,997 1,263,054,977 1,495,049,086 1,657,518,298 1,886,455,302 1,991,861,643 189,777,934 267,563,785 225,501,958 415,279,892 493,065,743 201,013,629 317,697,110 247,707,125 448,720,754 565,404,235 212,228,594 367,810,877 222,655,225 434,883,819 590,466,102 259,286,171 259,296,624 259,303,805 55,858,626 55,989,922 56,300,215 318,239,273 499,751,936 178,164,903 496,404,176 677,916,839 259,303,805 56,272,304 358,706,680 (Note 4) 110,395,320 469,102,000 (Note 4) 259,303,805 56,309,536 518,193,152 440,407,301 14,170,306 705,165,274 588,481,793 25,749,291 894,293,586 738,711,303 11,774,113 1,072,008,169 1,233,362,010 890,495,506 (Note 4) 1,663,983 (26,917,818) 847,508,255 1,046,201,111 1,221,671,719 1,389,248,261 1,522,057,533 769,722,404 929,517,630 1,066,089,436 1,207,735,598 266,830 127,221 962,760 802,865 (Note 4) 702,110 847,775,085 1,046,328,332 1,222,634,479 1,390,051,126 1,522,759,643 769,989,234 929,644,851 1,067,052,196 1,208,538,463 (Note 4) Note 1: The financial statements for 2013 were prepared in accordance with 2010 Taiwan-IFRSs version, and the financial statements for 2014-2017 were prepared in accordance with 2013 Taiwan-IFRSs version. The financial statements of 2014 were adjusted to retrospectively apply newly effected GAAP. Adjustments included a decrease of NT$84,759 thousand in total assets, a decrease of NT$737,344 thousand in total liabilities before distribution and an increase of NT$652,585 thousand in total equity before distribution. Note 2: Long-term investments consist of noncurrent available-for-sale financial assets, held-to-maturity financial assets, financial assets carried at cost and investments accounted for using equity method. Note 3: Other assets consist of deferred income tax assets, refundable deposits, and other noncurrent assets. Note 4: Pending shareholders’ approval. Condensed Balance Sheet from 2013 to 2017 (Unconsolidated) (Note 1) Unit: NT$ thousands Item Current Assets Long-term Investments (Note 2) Property, Plant and Equipment Intangible Assets Other Assets (Note 3) Total Assets Current Liabilities Before Distribution After Distribution Noncurrent Liabilities Total Liabilities Before Distribution After Distribution Equity Capital Stock Capital Surplus Retained Earnings Before Distribution After Distribution Others Total Equity Before Distribution After Distribution 2013 257,623,763 165,545,159 770,443,494 7,069,456 7,897,131 2014 (Adjusted) 370,949,497 242,395,596 796,684,361 8,996,810 3,935,389 2015 2016 2017 426,913,080 326,330,737 831,784,912 9,391,418 5,265,368 443,781,164 397,290,976 436,769,337 464,401,415 979,401,337 1,016,355,970 10,047,991 6,816,676 9,870,127 11,992,542 1,208,579,003 1,422,961,653 1,599,685,515 1,837,338,144 1,939,389,391 187,195,744 264,981,595 173,875,004 361,070,748 438,856,599 178,261,092 294,944,573 198,499,450 376,760,542 493,444,023 194,299,278 349,881,561 183,714,518 378,013,796 533,596,079 308,177,214 489,689,877 139,912,669 448,089,883 629,602,546 308,383,240 (Note 4) 108,948,618 417,331,858 (Note 4) 259,286,171 259,296,624 259,303,805 259,303,805 259,303,805 55,858,626 55,989,922 56,300,215 56,272,304 56,309,536 518,193,152 440,407,301 14,170,306 705,165,274 588,481,793 25,749,291 894,293,586 1,072,008,169 1,233,362,010 738,711,303 890,495,506 (Note 4) 11,774,113 1,663,983 (26,917,818) 847,508,255 1,046,201,111 1,221,671,719 1,389,248,261 1,522,057,533 769,722,404 929,517,630 1,066,089,436 1,207,735,598 (Note 4) Note 1: The financial statements for 2013 were prepared in accordance with 2010 Taiwan-IFRSs version, and the financial statements for 2014-2017 were prepared in accordance with 2013 Taiwan-IFRSs version. The financial statements of 2014 were adjusted to retrospectively apply newly effected GAAP. Adjustments included a decrease of NT$82,771 thousand in total assets, a decrease of NT$735,381 thousand in total liabilities before distribution and an increase of NT$652,610 thousand in total equity before distribution. Note 2: Long-term investments consist of held-to-maturity financial assets, financial assets carried at cost and investments accounted for using equity method. Note 3: Other assets consist of deferred income tax assets, refundable deposits, and other noncurrent assets. Note 4: Pending shareholders’ approval. 092 093 6.1.2 Condensed Statement of Comprehensive Income 6.1.3 Financial Analysis Condensed Statement of Comprehensive Income from 2013 to 2017 (Consolidated) (Note 1) Financial Analysis from 2013 to 2017 (Consolidated) (Note 1) Unit: NT$ thousands (Except EPS: NT$) Item Net Revenue Gross Profit Income from Operations Non-operating Income and Expenses Income before Income Tax Net Income Other Comprehensive Income for the Year, Net of Income Tax 2013 597,024,197 280,945,507 209,429,363 6,057,759 215,487,122 188,018,937 16,352,248 2014 (Adjusted) 762,806,465 377,722,016 295,870,309 6,208,048 302,078,357 263,763,958 11,805,021 Total Comprehensive Income for the Year 204,371,185 275,568,979 2015 2016 2017 843,497,368 410,394,893 320,047,775 30,381,136 350,428,911 306,556,167 (14,714,182) 291,841,985 947,938,344 474,832,098 377,957,778 8,001,602 385,959,380 334,338,236 (11,067,189) 323,271,047 977,447,241 494,826,402 385,559,223 10,573,807 396,133,030 343,146,848 (28,821,631) 314,325,217 Net Income (Loss) Attributable to: Shareholders of the Parent Noncontrolling Interests Total Comprehensive Income (Loss) Attributable to: Shareholders of the Parent Noncontrolling Interests Basic Earnings Per Share (Note 2) 188,146,790 263,881,771 306,573,837 334,247,180 343,111,476 (127,853) (117,813) (17,670) 91,056 35,372 204,505,782 275,670,991 291,867,757 323,186,736 314,294,993 (134,597) 7.26 (102,012) 10.18 (25,772) 11.82 84,311 12.89 30,224 13.23 Note 1: The financial statements for 2013 were prepared in accordance with 2010 Taiwan-IFRSs version, and the financial statements for 2014-2017 were prepared in accordance with 2013 Taiwan-IFRSs version. The financial statements of 2014 were adjusted to retrospectively apply newly effected GAAP. Adjustments included a decrease of NT$12,359 thousand in gross profit, a decrease of NT$19,984 thousand in income from operations, a decrease of NT$16,911 thousand in net income and a decrease of NT$46,054 thousand in total comprehensive income for the year. Note 2: Based on weighted average shares outstanding in each year. Condensed Statement of Comprehensive Income from 2013 to 2017 (Unconsolidated) (Note 1) Unit: NT$ thousands (Except EPS: NT$) Item Net Revenue Gross Profit Income from Operations Non-operating Income and Expenses Income before Income Tax Net Income Other Comprehensive Income for the Year, Net of Income Tax 2013 591,087,600 271,644,860 204,653,892 11,062,658 215,716,550 188,146,790 16,358,992 2014 (Adjusted) 757,152,389 366,899,120 290,640,302 10,363,515 301,003,817 263,881,771 11,789,220 Total Comprehensive Income for the Year 204,505,782 275,670,991 Basic Earnings Per Share (Note 2) 7.26 10.18 2015 2016 2017 837,046,888 397,708,840 313,408,698 36,579,970 349,988,668 306,573,837 (14,706,080) 291,867,757 11.82 936,387,291 461,808,296 369,730,533 15,458,427 385,188,960 334,247,180 (11,060,444) 323,186,736 12.89 969,136,109 478,937,691 374,690,117 18,626,059 393,316,176 343,111,476 (28,816,483) 314,294,993 13.23 Note 1: The financial statements for 2013 were prepared in accordance with 2010 Taiwan-IFRSs version, and the financial statements for 2014-2017 were prepared in accordance with 2013 Taiwan-IFRSs version. The financial statements of 2014 were adjusted to retrospectively apply newly effected GAAP. Adjustments included a decrease of NT$12,583 thousand in gross profit, a decrease of NT$19,356 thousand in income from operations, a decrease of NT$17,023 thousand in net income and a decrease of NT$46,150 thousand in total comprehensive income for the year. Note 2: Based on weighted average shares outstanding in each year. Capital Structure Analysis Debts Ratio (%) Long-term Fund to Property, Plant and Equipment (%) Liquidity Analysis Current Ratio (%) Operating Performance Analysis Quick Ratio (%) Times Interest Earned (Times) Average Collection Turnover (Times) Days Sales Outstanding Average Inventory Turnover (Times) Average Inventory Turnover Days Average Payment Turnover (Times) Property, Plant and Equipment Turnover (Times) Total Assets Turnover (Times) Profitability Analysis Return on Total Assets (%) Return on Equity attributable to Shareholders of the Parent (%) Operating Income to Paid-in Capital Ratio (%) Pre-tax Income to Paid-in Capital Ratio (%) Net Margin (%) Basic Earnings Per Share (NT$) Diluted Earnings Per Share (NT$) Cash Flow Cash Flow Ratio (%) Leverage Industry Specific Key Performance Indicator Cash Flow Adequacy Ratio (%) Cash Flow Reinvestment Ratio (%) Operating Leverage Financial Leverage Billing Utilization Rate (%) (Note 3) Advanced Technologies (28-nanometer and below) Percentage of Wafer Sales (%) Sales Growth (%) Net Income Growth (%) There’s no deviation of 2017 vs. 2016 over 20%. 2013 32.88 135.40 188.90 168.57 82.41 9.11 40.06 8.39 43.49 20.01 0.85 0.54 17.11 24.00 80.77 83.11 31.49 7.26 7.26 183.05 88.35 12.16 2.40 1.01 91 30 17.82 13.12 2014 (Adjusted) 30.01 158.16 311.70 278.03 94.34 8.12 44.95 7.42 49.19 19.39 0.95 0.55 19.33 27.86 114.10 116.50 34.58 10.18 10.18 209.70 92.15 13.04 2.15 1.01 97 42 27.77 40.25 2015 26.24 169.34 351.86 319.58 110.84 8.37 43.61 6.49 56.24 20.10 1.01 0.54 19.62 27.04 123.43 135.14 36.34 11.82 11.82 249.67 103.82 13.76 2.26 1.01 93 48 10.58 16.18 2016 26.31 157.17 256.95 241.34 117.74 8.78 41.57 8.18 44.62 20.11 1.02 0.53 19.03 25.60 145.76 148.84 35.27 12.89 12.89 169.63 108.57 11.51 2.15 1.01 92 54 12.38 9.03 2017 23.55 153.70 238.97 217.94 119.95 7.74 47.16 7.88 46.32 16.82 0.95 0.50 17.84 23.57 148.69 152.77 35.11 13.23 13.23 163.17 112.41 11.08 2.16 1.01 91 58 3.11 2.65 Note 1: Before 2012, financial statements were prepared in accordance with R.O.C GAAP. The financial statements for 2012-2013 were prepared in accordance with 2010 Taiwan-IFRSs version, and the financial statements for 2014-2017 were prepared in accordance with 2013 Taiwan-IFRSs version. Note 2: Capacity includes wafers committed by Vanguard and SSMC. *Glossary 1. Capital Structure Analysis (1) Debt Ratio = Total Liabilities / Total Assets (2) Long-term Fund to Property, Plant and Equipment Ratio = (Shareholders’ Equity + Noncurrent Liabilities) / Net Property, Plant and Equipment 2. Liquidity Analysis (1) Current Ratio = Current Assets / Current Liabilities (2) Quick Ratio = (Current Assets - Inventories - Prepaid Expenses) / Current Liabilities (3) Times Interest Earned = Earnings before Interest and Taxes / Interest Expenses 4. Profitability Analysis (1) Return on Total Assets = (Net Income + Interest Expenses * (1 - Effective Tax Rate)) / Average Total Assets (2) Return on Equity Attributable to Shareholders of the Parent = Net Income Attributable to Shareholders of the Parent / Average Equity Attributable to Shareholders of the Parent (3) Operating Income to Paid-in Capital Ratio= Operating Income / Paid-in Capital (4) Pre-tax Income to Paid-in Capital Ratio = Income before Tax / Paid-in Capital (5) Net Margin = Net Income / Net Sales (6) Earnings Per Share = (Net Income Attributable to Shareholders of the Parent - Preferred Stock Dividend) / Weighted Average Number of Shares Outstanding 3. Operating Performance Analysis 5. Cash Flow (1) Average Collection Turnover = Net Sales / Average Trade Receivables (2) Days Sales Outstanding = 365 / Average Collection Turnover (3) Average Inventory Turnover = Cost of Sales / Average Inventory (4) Average Inventory Turnover Days = 365 / Average Inventory Turnover (5) Average Payment Turnover = Cost of Sales / Average Trade Payables (6) Property, Plant and Equipment Turnover = Net Sales / Average Net Property, Plant and Equipment (1) Cash Flow Ratio = Net Cash Provided by Operating Activities / Current Liabilities (2) Cash Flow Adequacy Ratio = Five-year Sum of Cash from Operations / Five-year Sum of Capital Expenditures, Inventory Additions, and Cash Dividend (3) Cash Flow Reinvestment Ratio = (Cash Provided by Operating Activities - Cash Dividends)/ (Gross Property, Plant and Equipment + Long-term Investments + Other Noncurrent Assets + Working Capital) (7) Total Assets Turnover = Net Sales / Average Total Assets 6. Leverage (1) Operating Leverage = (Net Sales - Variable Cost) / Income from Operations (2) Financial Leverage = Income from Operations / (Income from Operations - Interest Expenses) 094 095 Financial Analysis from 2013 to 2017 (Unconsolidated) (Note) 6.1.4 Auditors’ Opinions from 2013 to 2017 Capital Structure Analysis Debt Ratio (%) Long-term Fund to Property, Plant and Equipment Ratio (%) Liquidity Analysis Current Ratio (%) Operating Performance Analysis Quick Ratio (%) Times Interest Earned (Times) Average Collection Turnover (Times) Days Sales Outstanding Average Inventory Turnover (Times) Average Inventory Turnover Days Average Payment Turnover (Times) Property, Plant and Equipment Turnover (Times) Total Assets Turnover (Times) Profitability Analysis Return on Total Assets (%) Return on Equity (%) Operating Income to Paid-in Capital Ratio (%) Pre-tax Income to Paid-in Capital Ratio (%) Net Margin (%) Basic Earnings Per Share (NT$) Diluted Earnings Per Share (NT$) Cash Flow Cash Flow Ratio (%) Leverage Cash Flow Adequacy Ratio (%) Cash Flow Reinvestment Ratio (%) Operating Leverage Financial Leverage There’s no deviation of 2017 vs. 2016 over 20%. 2013 29.88 132.57 137.62 118.35 104.10 9.26 39.40 9.06 40.30 18.55 0.87 0.55 17.58 24.00 78.93 83.20 31.83 7.26 7.26 179.11 86.78 12.32 2.46 1.01 2014 (Adjusted) 26.48 156.24 208.09 171.82 120.82 8.29 44.02 7.90 46.18 18.64 0.97 0.58 20.22 27.86 112.09 116.08 34.85 10.18 10.18 230.29 90.72 13.30 2.19 1.01 2015 23.63 168.96 219.72 186.00 144.41 8.58 42.54 6.87 53.11 19.73 1.03 0.55 20.42 27.04 120.87 134.97 36.63 11.82 11.82 264.94 102.35 13.85 2.31 1.01 2016 24.39 156.13 144.00 128.65 146.73 8.89 41.07 8.56 42.63 19.04 1.03 0.54 19.58 25.60 142.59 148.55 35.70 12.89 12.89 172.81 107.06 11.74 2.19 1.01 2017 21.52 160.48 141.63 118.68 144.04 7.86 46.44 8.39 43.49 16.39 0.97 0.51 18.29 23.57 144.50 151.68 35.40 13.23 13.23 184.45 99.42 10.98 2.22 1.01 Note: Before 2012, financial statements were prepared in accordance with R.O.C GAAP. The financial statements for 2012-2013 were prepared in accordance with 2010 Taiwan-IFRSs version, and the financial statements for 2014-2017 were prepared in accordance with 2013 Taiwan-IFRSs version. *Glossary 1. Capital Structure Analysis (1) Debt Ratio = Total Liabilities / Total Assets (2) Long-term Fund to Fixed Assets Ratio = (Shareholders’ Equity + Long-term Liabilities) / Net Fixed Assets 2. Liquidity Analysis (1) Current Ratio = Current Assets / Current Liabilities (2) Quick Ratio = (Current Assets - Inventories - Prepaid Expenses) / Current Liabilities (3) Times Interest Earned = Earnings before Interest and Taxes / Interest Expenses 3. Operating Performance Analysis (1) Average Collection Turnover = Net Sales / Average Trade Receivables (2) Days Sales Outstanding = 365 / Average Collection Turnover (3) Average Inventory Turnover = Cost of Sales / Average Inventory (4) Average Inventory Turnover Days = 365 / Average Inventory Turnover (5) Average Payment Turnover = Cost of Sales / Average Trade Payables (6) Fixed Assets Turnover = Net Sales / Average Net Fixed Assets (7) Total Assets Turnover = Net Sales / Average Total Assets 4. Profitability Analysis (1) Return on Total Assets = (Net Income + Interest Expenses * (1 - Effective Tax Rate)) / Average Total Assets (2) Return on Equity = Net Income / Average Shareholders’ Equity (3) Operating Income to Paid-in Capital Ratio = Operating Income / Paid-in Capital (4) Pre-tax Income to Paid-in Capital Ratio = Income before Tax / Paid-in Capital (5) Net Margin = Net Income / Net Sales (6) Earnings Per Share = (Net Income - Preferred Stock Dividend) / Weighted Average Number of Shares Outstanding 5. Cash Flow (1) Cash Flow Ratio = Net Cash Provided by Operating Activities / Current Liabilities (2) Cash Flow Adequacy Ratio = Five-year Sum of Cash from Operations / Five-year Sum of Capital Expenditures, Inventory Additions, and Cash Dividend (3) Cash Flow Reinvestment Ratio = (Cash Provided by Operating Activities - Cash Dividends) / (Gross Fixed Assets + Long-term Investments + Other Assets + Working Capital) 6. Leverage (1) Operating Leverage = (Net Sales - Variable Cost) / Income from Operations (2) Financial Leverage = Income from Operations / (Income from Operations - Interest Expenses) Year 2013 2014 2015 2016 2017 CPA Yih-Hsin Kao, Hung-Wen Huang Yih-Hsin Kao, Hung-Wen Huang Yih-Hsin Kao, Hung-Wen Huang Yih-Hsin Kao, Yu-Feng Huang Yih-Hsin Kao, Yu-Feng Huang Audit Opinion An Unqualified Opinion An Unqualified Opinion An Unqualified Opinion An Unmodified Opinion (Note) An Unmodified Opinion (Note) Note: Starting in 2016, the new auditing standard of the Republic of China requires “An Unqualified Opinion” be replaced by “An Unmodified Opinion”. Deloitte & Touche 12F, No. 156, Sec. 3, Min-Sheng E. Rd., Taipei, Taiwan, R.O.C. Tel: 886-2-2545-9988 6.1.5 Audit Committee’s Review Report The Board of Directors has prepared the Company’s 2017 Business Report, Financial Statements, and proposal for allocation of earnings. The CPA firm of Deloitte & Touche was retained to audit TSMC’s Financial Statements and has issued an audit report relating to the Financial Statements. The Business Report, Financial Statements, and earnings allocation proposal have been reviewed and determined to be correct and accurate by the Audit Committee members of Taiwan Semiconductor Manufacturing Company Limited. According to relevant requirements of the Securities and Exchange Act and the Company Law, we hereby submit this report. Taiwan Semiconductor Manufacturing Company Limited Chairman of the Audit Committee: Sir Peter Leahy Bonfield February 13, 2018 6.1.6 Financial Difficulties The Company should disclose the financial impact to the Company if the Company and its affiliated companies have incurred any financial or cash flow difficulties in 2017 and as of the date of this Annual Report: None. 6.1.7 Consolidated Financial Statements and Independent Auditors’ Report along with Parent Company Only Financial Statements and Independent Auditors’ Report Please refer to Annual Report section (II), Financial Statements. 096 097 6.2 Financial Status and Operating Results 6.2.1 Financial Status Consolidated Unit: NT$ thousands Item Current Assets Long-term Investments (Note 1) Property, Plant and Equipment Intangible Assets Other Assets (Note 2) Total Assets Current Liabilities Noncurrent Liabilities Total Liabilities Capital Stock Capital Surplus Retained Earnings Others Equity Attributable to Shareholders of the Parent Total Equity 2017 857,203,110 41,569,074 1,062,542,322 14,175,140 16,371,997 2016 817,729,126 46,153,916 997,777,687 14,614,846 10,179,727 1,991,861,643 1,886,455,302 358,706,680 110,395,320 469,102,000 259,303,805 56,309,536 1,233,362,010 (26,917,818) 1,522,057,533 1,522,759,643 318,239,273 178,164,903 496,404,176 259,303,805 56,272,304 1,072,008,169 1,663,983 1,389,248,261 1,390,051,126 Difference 39,473,984 (4,584,842) 64,764,635 (439,706) 6,192,270 105,406,341 40,467,407 (67,769,583) (27,302,176) 0 37,232 161,353,841 (28,581,801) 132,809,272 132,708,517 % 5% -10% 6% -3% 61% 6% 13% -38% -5% 0% 0% 15% -1,718% 10% 10% Note 1: Long-term investments consist of noncurrent available-for-sale financial assets, held-to-maturity financial assets, financial assets carried at cost and investments accounted for using equity method. Note 2: Other assets consist of deferred income tax assets, refundable deposits, and other noncurrent assets. ● Analysis of Deviation over 20% Increase in other assets: The increase was mainly due to increase in deferred income tax assets and refundable deposits. Decrease in noncurrent liabilities: The decrease was mainly due to reclassification of bonds payable due in 1 year to current liabilities and decrease in guarantee deposits. Decrease in other equity: The decrease was mainly due to increase in currency exchange loss arising from translation of foreign operations in 2017. ● Major Impact on Financial Position The above deviations had no major impact on TSMC’s financial position. ● Future Plan on Financial Position: Not applicable. Unconsolidated Unit: NT$ thousands Item Current Assets Long-term Investments (Note 1) Property, Plant and Equipment Intangible Assets Other Assets (Note 2) Total Assets Current Liabilities Noncurrent Liabilities Total Liabilities Capital Stock Capital Surplus Retained Earnings Others Total Equity 2017 436,769,337 464,401,415 1,016,355,970 9,870,127 11,992,542 2016 443,781,164 397,290,976 979,401,337 10,047,991 6,816,676 1,939,389,391 1,837,338,144 308,383,240 108,948,618 417,331,858 259,303,805 56,309,536 1,233,362,010 (26,917,818) 1,522,057,533 308,177,214 139,912,669 448,089,883 259,303,805 56,272,304 1,072,008,169 1,663,983 1,389,248,261 Difference (7,011,827) 67,110,439 36,954,633 (177,864) 5,175,866 102,051,247 206,026 (30,964,051) (30,758,025) 0 37,232 161,353,841 (28,581,801) 132,809,272 % -2% 17% 4% -2% 76% 6% 0% -22% -7% 0% 0% 15% -1,718% 10% Note 1: Long-term investments consist of held-to-maturity financial assets, financial assets carried at cost and investments accounted for using equity method. Note 2: Other assets consist of deferred income tax assets, refundable deposits, and other noncurrent assets. ● Analysis of Deviation over 20% Increase in other assets: The increase was mainly due to increase in deferred income tax assets and refundable deposits. Decrease in noncurrent liabilities: The decrease was mainly due to reclassification of bonds payable due in 1 year to current liabilities and decrease in guarantee deposits. Decrease in other equity: The decrease was mainly due to increase in currency exchange loss arising from translation of foreign operations in 2017. ● Major Impact on Financial Position The above deviations had no major impact on TSMC’s financial position. ● Future Plan on Financial Position: Not applicable. 098 099 6.2.2 Financial Performance Consolidated Unit: NT$ thousands Item Net Revenue Cost of Revenue Gross Profit before Unrealized Gross Profit on Sales to Associates Unrealized Gross Profit on Sales to Associates Gross Profit Operating Expenses Other Operating Income and Expenses, Net Income from Operations Non-operating Income and Expenses Income before Income Tax Income Tax Expenses Net Income Other Comprehensive Loss, Net of Income Tax Total Comprehensive Income for the Year Total Net Income Attributable to Shareholders of the Parent Total Comprehensive Income Attributable to Shareholders of the Parent 2017 977,447,241 482,616,286 494,830,955 (4,553) 494,826,402 107,901,668 (1,365,511) 385,559,223 10,573,807 396,133,030 52,986,182 343,146,848 (28,821,631) 314,325,217 343,111,476 314,294,993 2016 947,938,344 473,077,173 474,861,171 (29,073) 474,832,098 96,904,133 29,813 377,957,778 8,001,602 385,959,380 51,621,144 334,338,236 (11,067,189) 323,271,047 334,247,180 323,186,736 Difference 29,508,897 9,539,113 19,969,784 24,520 19,994,304 10,997,535 (1,395,324) 7,601,445 2,572,205 10,173,650 1,365,038 8,808,612 (17,754,442) (8,945,830) 8,864,296 (8,891,743) % 3% 2% 4% -84% 4% 11% -4,680% 2% 32% 3% 3% 3% -160% -3% 3% -3% ● Analysis of Deviation over 20% Decrease in unrealized gross profit on sales to associates: The decrease was mainly due to lower sales to associates in the fourth quarter of 2017. Decrease in other operating income and expenses, net: The decrease was mainly due to higher net loss on disposal of property, plant and equipment in 2017. Increase in non-operating income and expenses: The increase was mainly due to higher interest income in 2017. Increase in other comprehensive loss, net of income tax: The increase was mainly due to increase in currency exchange loss arising from translation of foreign operations in 2017. ● Sales Volume Forecast and Related Information For additional details, please refer to “1. Letter to Shareholders” on page 4-7 of this Annual Report. ● Major Impact on Financial Performance The above deviations had no major impact on TSMC’s financial performance. ● Future Plan on Financial Performance: Not applicable. Unconsolidated Unit: NT$ thousands Item Net Revenue Cost of Revenue Gross Profit before Unrealized Gross Profit on Sales to Subsidiaries and Associates Unrealized Gross Profit on Sales to Subsidiaries and Associates Gross Profit Operating Expenses Other Operating Income and Expenses, Net Income from Operations Non-operating Income and Expenses Income before Income Tax Income Tax Expenses Net Income Other Comprehensive Loss, Net of Income Tax Total Comprehensive Income for the Year 2017 969,136,109 490,196,856 478,939,253 (1,562) 478,937,691 102,985,909 (1,261,665) 374,690,117 18,626,059 393,316,176 50,204,700 343,111,476 (28,816,483) 314,294,993 2016 936,387,291 474,552,913 461,834,378 (26,082) 461,808,296 92,161,728 83,965 369,730,533 15,458,427 385,188,960 50,941,780 334,247,180 (11,060,444) 323,186,736 Difference 32,748,818 15,643,943 17,104,875 24,520 17,129,395 10,824,181 (1,345,630) 4,959,584 3,167,632 8,127,216 (737,080) 8,864,296 (17,756,039) (8,891,743) % 3% 3% 4% -94% 4% 12% -1,603% 1% 20% 2% -1% 3% -161% -3% ● Analysis of Deviation over 20% Decrease in unrealized gross profit on sales to subsidiaries and associates: The decrease was mainly due to lower sales to subsidiaries and associates in the fourth quarter of 2017. Decrease in other operating income and expenses, net: The decrease was mainly due to higher net loss on disposal of property, plant and equipment in 2017. Increase in non-operating income and expenses: The increase was mainly due to higher share of profits of subsidiaries and associates in 2017. Increase in other comprehensive loss, net of income tax: The increase was mainly due to increase in currency exchange loss arising from translation of foreign operations in 2017. ● Sales Volume Forecast and Related Information For additional details, please refer to “1. Letter to Shareholders” on page 4-7 of this Annual Report. ● Major Impact on Financial Performance The above deviations had no major impact on TSMC’s financial performance. ● Future Plan on Financial Performance: Not applicable. 100 101 6.2.3 Cash Flow Consolidated Unit: NT$ thousands Cash Balance 12/31/2016 Net Cash Provided by Operating Activities in 2017 Net Cash Used in Investing and Financing Activities in 2017 Cash Balance 12/31/2017 Remedy for Liquidity Shortfall Investment Plan Financing Plan 541,253,833 585,318,167 (573,180,304) 553,391,696 None None ● Analysis of Cash Flow NT$585.3 billion net cash generated by operating activities: mainly from net income and depreciation and amortization expenses. NT$336.2 billion net cash used in investing activities: primarily for capital expenditures and net purchase of marketable financial instruments. NT$237.0 billion net cash used in financing activities: primarily for cash dividend payment and repayment of corporate bonds. ● Remedial Actions for Liquidity Shortfall: As a result of positive operating cash flows and cash on-hand, remedial actions are not required. ● Cash Flow Projection for Next Year: Not applicable. Unconsolidated Unit: NT$ thousands Cash Balance 12/31/2016 Net Cash Provided by Operating Activities in 2017 Net Cash Used in Investing and Financing Activities in 2017 Cash Balance 12/31/2017 Remedy for Liquidity Shortfall Investment Plan Financing Plan 249,878,563 568,800,331 (579,502,053) 239,176,841 None None ● Analysis of Cash Flow NT$568.8 billion net cash generated by operating activities: mainly from net income and depreciation and amortization expenses. NT$285.3 billion net cash used in investing activities: primarily for capital expenditures. NT$294.2 billion net cash used in financing activities: primarily for cash dividend payment, capital injection in subsidiaries and repayment of corporate bonds. ● Remedial Actions for Liquidity Shortfall: As a result of positive operating cash flows and cash on-hand, remedial actions are not required. ● Cash Flow Projection for Next Year: Not applicable. 6.2.4 Recent Years Major Capital Expenditures and Impact on Financial and Business Unit: NT$ thousands Plan Actual or Planned Source of Capital Production Facilities, R&D and Production Equipment Cash flow generated from operations Total Amount for 2017 and 2016 Actual Use of Capital 2017 2016 652,789,502 327,317,670 325,471,832 Others Total Cash flow generated from operations 5,843,956 3,270,518 2,573,438 658,633,458 330,588,188 328,045,270 Based on capital expenditures listed above, TSMC’s annual production capacity increased by approximately 1 million 12-inch equivalent wafers in 2017. 6.2.5 Long-term Investment Policy and Results TSMC’s long-term investments, accounted for under the equity method, were all made for strategic purposes. However, when an investment is no longer of strategic value, it may be considered a financial investment. In 2017, the investment gains from these investments amounted to NT$2,985,941 thousand on a consolidated basis, decreasing from previous year mainly due to a significant appreciation in NT dollar and a decline in ASP. For future investments, TSMC will continue to focus on strategic purposes through prudent assessments. 6.3 Risk Management The Board of Directors plays a key role in helping the Company identify and manage economic risks. The risk management organization periodically briefs the audit committee on the ever-changing risk environment facing TSMC, the focus of the Company’s enterprise risk management, and risk assessment and mitigation efforts. The audit committee’s chairperson also reports on the risk environment and risk mitigation actions to be taken. TSMC and its subsidiaries are committed to proactively and cost effectively integrating and managing strategic, operational, financial and hazardous risks together with potential consequences to operations and financial results. TSMC operates an enterprise risk management (ERM) program based on both its corporate vision and its long-term sustainability, as well as on its responsibility to both industry and society. ERM seeks to provide the appropriate management of risks by TSMC on behalf of all stakeholders. A risk map that considers likelihood and impact severity is used to identify and prioritize corporate risks. Various risk treatment strategies are also adopted in response corporate risks as they are identified. Scope of Risk Management Strategic Perspective ● Regulatory change & compliance ● Government policies ● Changes in technology & industry ● Technology development & competition ● Demand & capacity Expansion Operational Perspective ● Sales & purchase concentration ● Intellectual property rights ● Recruiting qualified personnel ● Corporate image Financial Perspective ● Interest rate, foreign exchange, inflation & deflation, Taxation ● External financing ● High-risk/high-leveraged investment, financial derivative transactions ● Strategic investments Hazardous Events ● Earthquake & natural hazards ● Fire or chemical spill ● Climate change Enterprise Risk Management Framework Risk Identification & Assessment ● RM Steering Committee & Audit Committee review & approve implementation of risk management strategy and prioritization of risk controls ● RM Executive Council assesses risks using Risk Map considering likelihood & severity of risk events Risk Control & Mitigation ● Cross-function risk communication to determine cost-effective risk controls ● RM Executive is responsible for risk control implementation ● Risk controls reviewed in annual Control Self Assessment Risk Response ● Crisis management & response plans ● Scenario-based crisis response drills ● Business Continuity Plans Risk Monitoring & Reporting ● Risk Management organization annually briefs Audit Committee on the focus of enterprise risk management, risks assessment and mitigation efforts To mitigate the operational impacts of crisis events, ERM conducts pre-crisis risk assessment and identifies feasible strategies for crisis prevention. Corresponding to different scenarios, response procedures and recovery plans have been compiled. For specific severe crisis events involving multiple TSMC’s manufacturing sites, the cross-functional central crisis command center composed of operations and support functions is responsible for internal coordination to speed up response time and proactively communicate with related stakeholders. To raise risk awareness and strengthen the risk management culture in TSMC, top management completed a series of crisis management workshops and a drill for operation 102 103 of Central Crisis Command Center with Co-CEOs’ oversight in 2017. The scenario-based crisis response drills were also conducted for critical risk events such as fire, earthquake, IT service disruption, supply chain disruption, environmental events and utility supply disruption. In order to continuously mitigate corporate risks, drills are used to test the integrity and risk-control effectiveness of ERM. To reduce supply chain risks, TSMC created a cross-functional taskforce comprised of members from fab operations, material management, risk management and quality system management to work with suppliers to develop business continuity plans and enhance supply chain resilience to effectively manage the risks faced by its suppliers. Partly as a result of these efforts, there was no interruption in TSMC’s supply chain in 2017. As TSMC continued to expand production capacity with advanced technology, seismic protection engineering design, risk treatment practices and green factory projects were initiated and implemented, beginning in the design phase for all new fabs. 6.3.1 Risk Management (RM) Organization Chart TSMC’s Risk Management organization annually briefs the Audit Committee on the focus of enterprise risk management, risk assessment and mitigation efforts. The Audit Committee’s Chairperson also briefs the Board on such discussion and actions. Board of Directors/ Audit Committee RM Steering Committee Materials Management and Risk Management RM Executive Council RM Program Organization Functions ● RM steering committee Consists of functional heads (with internal audit head sitting as an observer); Reports to audit committee; Reviews risk control progress; Identifies and approves the prioritized risk lists. ● RM executive council Consists of representatives from each function; Identifies and assesses risks; Implements risk control programs and ensures effectiveness; Improves transparency and how risks are managed. ● RM program Coordinates and facilitates functional risk management activities; Initiates cross-functional communication for risk mitigation; Consolidates ERM reports into the RM steering committee. 6.3.2 Strategic Risks Risks Associated with Changes in Technology and Industry ● Industry Developments The electronics industries and semiconductor market are cyclical and subject to significant and often rapid fluctuations in product demand, which could impact TSMC’s semiconductor foundry business. Variations in order levels from customers may result in volatility in the Company’s revenue and earnings. From time to time, the electronics and semiconductor industries have experienced significant, occasionally prolonged periods of downturns and overcapacity. Because TSMC is, and will continue to be, dependent on the requirements of electronics and semiconductor companies for our services, periods of downturns and overcapacity in the general electronics and semiconductor industries could lead to reduced demand for overall semiconductor foundry services, including TSMC’s services. If TSMC cannot take appropriate actions such as reducing its costs to sufficiently offset declines in demand, the Company’s revenue, margin, and earnings will likely suffer during periods of downturns and overcapacity. ● Changes in Technology The semiconductor industry and its technologies are constantly changing. TSMC competes by developing process technologies using increasingly advanced nodes and on manufacturing products with more functions. We also compete by developing new derivative technologies. If TSMC does not anticipate these changes in technologies and rapidly develop new and innovative technologies, or if the Company’s competitors unforeseeably gain sudden access to additional technologies, TSMC may not be able to provide foundry services on competitive terms. In addition, TSMC’s customers have significantly decreased the time in which their products or services are launched into the market. If TSMC is unable to meet these shorter product time-to-market, it risks losing these customers. These factors have also been intensified by the shift of the global technology market to consumer driven products such as mobile devices, and increasing concentration of customers and competition (all further discussed among these risk factors). If TSMC is unable to innovate new technologies that meet the demands of its customers or overcome the above factors, its revenue may decline significantly. Although TSMC has concentrated on maintaining a competitive edge in research and development, if TSMC fails to achieve advances in technologies or processes, it may become less competitive. Regarding the response measures for the above-mentioned risks, please refer to “2.2.4 TSMC Position, Differentiation and Strategy” on page 14-15 of this annual report. Risks Associated with Decrease in Demand and Average Selling Price A vast majority of the Company’s revenue is derived from customers who use our services in communication devices, personal computers, consumer electronics products and industrial/standard products. The demand for our products are significantly affected by the outlook of the major and emerging end markets for our products, such as mobile devices, high-performance computing (including cryptocurrency mining), automotive electronics and the Internet of things (“IoT”). Any deterioration in or a slowdown in the growth of such end markets resulting in a substantial decrease in the demand for overall global semiconductor foundry services, including TSMC’s products and services, could adversely affect the Company’s revenue. Further, semiconductor manufacturing facilities require substantial investment to construct and are largely fixed cost assets once they are in operation. Because the Company owns most of its manufacturing capacities, a significant portion of TSMC’s operating costs is fixed. In general, these costs do not decline when customer demand or TSMC’s capacity utilization rates drop, and thus declines in customer demand, among other factors, may significantly decrease TSMC’s margins. Conversely, as product demand rises and factory utilization increases, the fixed costs are spread over increased output, which can improve TSMC’s margins. In addition, the historical and current trend of declining average selling prices (ASP) of end use applications places downward pressure on the prices of the components that go into such applications. If the ASP of end use applications continues decreasing, the pricing pressure on components produced by the Company may lead to a reduction of TSMC’s revenue, margin and earnings. Risks Associated with Competition The markets for TSMC’s foundry services are highly competitive. TSMC competes with other foundry service providers, as well as a number of integrated device manufacturers. Some of these companies may have access to more advanced technologies than TSMC. Other companies may have greater financial and other resources than TSMC, such as the possibility of receiving direct or indirect government subsidy, economic stimulus funds, or other incentives that may be unavailable to TSMC. For example, Chinese companies are expected to be key players for new semiconductor fab development and fab equipment spending through 2020. There are over twenty new semiconductor fab projects that have been announced or are being developed within China in part due to various incentives provided by the Chinese government. Furthermore, the Company’s competitors may, from time to time, also decide to undertake aggressive pricing initiatives in one or several technology nodes. These competitive activities may decrease TSMC’s customer base, or its ASP, or both. If TSMC is unable to compete effectively with these new and aggressive competitors on technology, manufacturing capacity, and customer satisfaction, it risks losing customers to these new contenders. Risks Associated with Changes in the Government Policies and Regulatory Environment TSMC management closely monitors all domestic and foreign governmental policies and regulations that might impact TSMC’s business and financial operations. During 2017 and as of February 28, 2018, the following changes or developments in governmental policies and regulations may influence the Company’s business operations: Effective from 2018, the R.O.C. Income Tax Law was amended, which abolished the imputation system, raised the corporate income tax rate from 17% to 20%, and reduced the rate of surtax imposed on unappropriated earnings from 10% to 5%. However, since we are still eligible for a five-year tax exemption for capital investments made in previous years, we do not expect the R.O.C. tax amendment to have a significant impact on our effective tax rate for 2018. To comply with the Labor Standards Act amended on December 21, 2016, TSMC made certain changes to its relevant internal rules, including adjusting overtime pay for work on days of rest as well as increasing employees’ annual leave entitlements. These changes increase the operating costs of the Company. Such increase of costs, however, can 104 105 be mitigated in 2018 due to the re-amendment of the Labor Standards Act released on January 31, 2018, which readjusted the calculation formula for overtime pay for work on days of rest. With respect to environmental laws, the changes include (1) In order to enforce the new law of “Greenhouse Gas Reduction and Management Act” in response to climate change, the “Regulations for Periodic Regulatory Goals and Approaches of the Greenhouse Gas Emissions” was released in March 2017 to stipulate the national goals and schedules of greenhouse gas reduction. TSMC has taken various measures to mitigate possible impacts on future operational expansion plans; (2) The “Collection Rate for Stationary Pollution Source Air Pollutant Emissions Fees” and “Emergency Control Regulation for Dealing with Serious Deterioration of Air Quality” were adopted in May and June 2017 which create a new fee type, called the “seasonal” air pollution control fee, and further authorize local governments to set up local control plans in their regions respectively, both of which would increase the Company’s operational costs; and (3) In June 2017, the regulation “Guidelines for Defining the Enterprise’s Due Care Obligations When Commissioning the Clearance and Disposal of its Industrial Waste” was newly adopted to reflect the new requirement under “Waste Disposal Act” amended at the same year, which provides guidance on what enterprises shall do to monitor the commissioned personnel with due care if it outsources the disposal of its industrial waste. TSMC will amend the relevant internal procedures and agreements with the commissioning entities to enhance the selections and audits of the outsourcing contractual vendors in compliance with the law requirements. In addition, some other environmental laws were proposed to be amended (such as “Environmental Impact Assessment Act” and “Air Pollution Control Act”), the exact effects of which are still uncertain as the amendments have not been finalized yet. However, we expect these amendments may affect our future expansion plans and increase the Company’s operational costs. Other than the above laws and regulations, it is not expected that other governmental policies or regulatory changes would materially impact TSMC’s operations and financial condition. 6.3.3 Operational Risks Risks Associated with Capacity Expansion TSMC performs long-term market demand forecast for its products and services to manage its overall capacity. Because market conditions are dynamic, TSMC’s market demand forecast may change significantly at any time. During periods of decreased demand, certain manufacturing lines or tools in some of the Company’s manufacturing facilities may be suspended or shut down temporarily. However, if subsequent demand increases rapidly in a short period of time, TSMC may not be able to restore the capacity in a timely manner to take advantage of the upturn. According to the market demand forecast, TSMC has recently been adding capacity in its 300mm wafer fabs to meet market needs for its products and services. Expansion of the Company’s capacity will increase its costs. For example, the Company will need to purchase additional equipment, hire additional personnel and train personnel to operate the new equipment. If TSMC does not increase its net revenue accordingly, its financial performance may be adversely affected by these increased costs. In order to mitigate the risk associated with capacity expansion, TSMC continuously watches for changes in market conditions and works closely with its customers. When market demand is not as expected, the Company will adjust its capacity plans in a timely manner to reduce the impact on its financial performance. Risks Associated with Sales Concentration Over the years, TSMC’s customer profile and the nature of its customers’ business have changed dramatically. While it generates revenue from hundreds of customers worldwide, TSMC’s ten largest customers in 2015, 2016, and 2017 accounted for approximately 63%, 69% and 67% of its net revenue in the respective year. The Company’s largest customer in 2015, 2016, and 2017 accounted for 16%, 17% and 22% of its net revenue in the respective year. The Company’s second largest customer in 2015 and 2016 accounted for 16% and 11% of its net revenue in the respective year. In 2017, the Company’s second largest customer accounted for less than 10% of its net revenue. A more concentrated customer base will subject our revenue to seasonal demand fluctuations from our large customers, and cause different seasonal patterns of our business. This customer concentration results in part from the changing dynamics of the electronics industry with the structural shift to mobile devices and applications and software that provide the content for such devices. These are only a limited number of customers who are successfully exploiting this new business model paradigm. Also, in order to respond to the new business model paradigm, TSMC has seen the changes of nature in its customers’ business models. For example, there is a growing trend toward the rise of system houses that operate in a manner which makes their products and services more marketable in a changing consumer market. Also, since the global semiconductor industry is becoming increasingly competitive, some of TSMC’s customers have engaged in industry consolidations in order to remain competitive. Such consolidations have taken the form of mergers and acquisitions. If more of TSMC’s major customers consolidate, this will further decrease the overall number of its customer pool. The loss of, or significant curtailment of purchases by, one or more of the Company’s top customers, including curtailments due to increased competitive pressures, industry consolidation, a change in their designs, or change in their manufacturing sourcing policies or practices of these customers, or the timing of customer or distributor inventory adjustments, or change in its major customers’ business models may adversely affect TSMC’s results of operations and financial condition. TSMC maintains a close watch on these trends and works closely with its customers to respond to these changes and to strengthen the Company’s market position. Risks Associated with Purchase Concentration ● Raw Materials TSMC’s production operations require that TSMC obtains adequate supplies of raw materials, such as silicon wafers, gases, chemicals, and photoresist, on a timely basis and at commercially reasonable prices. In the past, shortages in the supply of some materials, whether by specific suppliers or by the semiconductor industry generally, have resulted in occasional industry-wide price adjustments and delivery delays. For example, the recent increase in silicon wafer prices due to increased demand for such wafers across the industry had a negative impact on TSMC’s gross margin in 2017 and the trend is expected to continue in 2018. In addition, major natural disasters, political or economic turmoil occurring within the country of origin of such raw materials may also significantly disrupt the availability of such raw materials or increase their prices. Also, since TSMC procures some of its raw materials from sole-source suppliers, there is a risk that the need for such raw materials may not be met or that back-up supplies may not be readily available. TSMC’s revenue and earnings could decline if the Company is unable to obtain adequate supplies of the necessary raw materials in a timely manner or if there are significant increases in the costs of raw materials that the Company cannot pass on to its customers. To reduce the supply chain risk and to manage the cost actively, TSMC is committing resources toward developing new supply sources. In addition, the Company continually encourages its suppliers to reduce their supply chain risk by decentralizing production plants and to improve their cost competitiveness by moving their production facilities to Taiwan from higher-cost areas. In the meantime, aware of the risk posed by fewer back-up suppliers, TSMC is engaging early and extensively with primary suppliers on managing quality and capacity issues in order to be prepared for any unexpected need to ramp up production, which could leave the Company with insufficient time to re-tune its production process. For leading technology nodes, TSMC uses world-class processes at world-class facilities but also requires world-class material quality. To streamline supply chain risk management, the Company intensifies supplier site audits and meetings to extend supply chain best practices to its upstream suppliers. Moreover, TSMC continually refines its planning system and enhances demand forecast alignments with critical suppliers for more accurate supply capacity planning, especially for the steep production ramp-up of new nodes. The Company has developed a supply chain risk assessment for critical suppliers that fulfills requirements on labor and ethics, ESH (Environmental, Safety and Health) and BCP (Business Continuity Plan). To ultimately empower these suppliers to take responsibility for their supply chain, on-site audits are conducted regularly. Any regulatory violations or any adverse environmental impact event, as well as a failure to meet TSMC’s expectations in sustainability requirements, may result in business reduction or termination. ● Equipment The Company’s operations and ongoing expansion plans depend on its ability to obtain an appropriate amount of equipment and related services from a limited number of suppliers in a market that is characterized from time to time by limited supply and long delivery cycles. During such times, supplier-specific or industry-wide lead times for delivery can be as long as six months or more. To better manage its supply chain, the Company has implemented various business models and risk management contingencies with suppliers to shorten the procurement lead time. Further, the growing complexities, especially in next-generation lithographic technologies, may delay the timely availability of the equipment and parts needed to exploit time-sensitive business opportunities and also increase the market price for such equipment and parts. 106 107 If TSMC is unable to obtain equipment in a timely manner to fulfill its customers’ demands on technology and production capacity, or at a reasonable cost, its financial condition and results of operations could be negatively impacted. Risks Associated with Intellectual Property Rights The Company’s ability to compete successfully and to achieve future growth depends in part on the continued strength of its intellectual property portfolio. While we actively enforce and protect our intellectual property rights, there can be no assurance that its efforts will be adequate to prevent the misappropriation or improper use of its proprietary technologies, software, trade secrets or know-how. Also, the Company cannot assure that, as its business or business models expand into new areas, it will be able to develop independently the technologies, patents, software, trade secrets or know-how necessary to conduct its business or that it can do so without unknowingly infringing the intellectual property rights of others. As a result, TSMC may have to rely on, to a certain degree, licensed technologies and patent licenses from others. To the extent that the Company relies on licenses from others, there can be no assurance that it will be able to obtain any or all of the necessary licenses in the future on terms it considers reasonable or at all. The lack of necessary licenses could expose TSMC to claims for damages and/or injunctions from third parties, as well as claims for indemnification by its customers in instances where it has contractually agreed to indemnify its customers against damages resulting from infringement claims. TSMC has received, from time-to-time, communications from third parties asserting that TSMC’s technologies, manufacturing processes, or the design IPs of the semiconductors made by TSMC or the use of those semiconductors by its customers may infringe their patents or other intellectual property rights. Because of the nature of the industry, the Company may continue to receive such communications in the future. These assertions have at times resulted in litigation. Recently, there has been a notable increase within the industry in the number of assertions made and lawsuits initiated by certain litigious, non-practicing entities and these litigious, non-practicing entities are also becoming more aggressive in their monetary demands and requests for court-issued injunctions. Such lawsuits or assertions may increase TSMC’s cost of doing business and may potentially be extremely disruptive if these non-practicing entities succeed in blocking the trade of products and services offered by TSMC. Also, as the Company expended its manufacturing operations into certain non-R.O.C. jurisdictions, we have faced increasing challenges to manage risks of intellectual property misappropriation. Despite our efforts to adopt robust measures to mitigate the risk of intellectual property misappropriation in such new jurisdictions, we cannot guarantee that the protection measures we adopted will be sufficient to prevent us from potential infringements by others, or at all. If TSMC fails to obtain or maintain certain technologies or intellectual property licenses or fails to prevent our intellectual property from being misappropriated and, if litigation relating to alleged intellectual property matters occurs, it could: (1) prevent the Company from manufacturing particular products or selling particular services or applying particular technologies; and (2) reduce our ability to compete effectively against entities benefiting from our misappropriated intellectual property, which could reduce its opportunities to generate revenue. TSMC has taken related measures to minimize potential loss of shareholder value arising from intellectual property claims and litigation filed against the Company. These measures include: strategically obtaining licenses from certain semiconductor and other technology companies as needed; timely securing intellectual property rights for defensive and/or offensive protection of TSMC technology and business; and aggressively defending against baseless litigation. Risks Associated with Litigious and Non-litigious Matters As is the case with many companies in the semiconductor industry, TSMC has received from time-to-time communications from third parties asserting that its technologies, its manufacturing processes, or the design of the semiconductors made by TSMC or the use of those semiconductors by its customers may infringe upon their patents or other intellectual property rights. These assertions have at times resulted in litigation by or against the Company and settlement payments by the Company. Irrespective of the validity of these claims, TSMC could incur significant costs in the defense thereof or could suffer adverse effects on its operations. Currently, TSMC’s material legal proceedings are as follows: In May 2017, Uri Cohen filed a complaint in the U.S. District Court for the Eastern District of Texas alleging that TSMC, TSMC North America and other companies infringe four U.S. patents. Cohen’s case has been transferred to and consolidated with the responsive declaratory judgment case for non-infringement of Cohen’s asserted patents filed by TSMC and TSMC North America in the U.S. District Court for the Northern District of California. The outcome cannot be determined and the Company cannot make a reliable estimate of the contingent liability at this time. On September 28, 2017, TSMC was contacted by the European Commission (the “Commission”), which has asked us for information and documents concerning alleged anti-competitive practices in relation to semiconductor sales. We are cooperating with the Commission to provide the requested information and documents. In light of the fact that this proceeding is still in its preliminary stage, it is premature to predict how the case will proceed, the outcome of the proceeding or its impact. Other than the matters described above, as of the date of this Annual Report, TSMC is not currently a party to any other material legal proceedings. Risks Associated with Mergers and Acquisitions During 2017 and in 2018 as of the date of this annual report, there were no such risks for TSMC. Risks Associated with Recruiting Qualified Personnel The Company relies on the continued services and contributions of its executive officers and skilled technical and other personnel. TSMC’s business could suffer if we lose, for whatever reasons, the services and contributions of some of these personnel and we cannot adequately replace them. TSMC may be required to increase or reduce the number of employees in connection with business expansion or contraction, in accordance with market demand for the Company’s products and services. Since there is intense competition for the recruitment of these personnel, it cannot ensure that TSMC will be able to fulfill its personnel requirements in a timely manner. Future R&D Plans and Expected R&D Spending For additional details, please refer to “5.2.7 Future R&D Plans” on page 79-80 of this annual report. innovation and customer trust, as well as its outstanding operations, rigorous corporate governance, and dedication to social responsibility by serving as a good corporate citizen and continuing to pursue innovation in the economic, environmental and social dimensions of CSR. In 2017, TSMC was honored with awards and recognition for achievements in operations, corporate governance, innovation, profit growth, investor relations, environmental protection, corporate sustainability and other fields. These included: the Taiwan Institute for Sustainable Energy 2017 Taiwan Corporate Sustainability Awards No.1 for Domestic Corporates, Gold Medal For Sustainability Report, and Circular Economy Leadership Award; No.1 in the R.O.C. Ministry of Economic Affairs (MOEA) Intellectual Property Office ranking of “Top 100 Patent Applications”; ranked top 5% in the Taiwan Stock Exchange Corporate Governance Evaluation; ranked No.1 in profit for the China Credit Information Services’ ranking of large Taiwan companies; The R.O.C. Ministry of Economic Affairs Industrial Development Bureau “Green Factory Label”; The R.O.C. Environmental Protection Administration “National Environmental Education Award”; and The MOEA award for Outstanding Greenhouse Gas Reduction, and Benchmark Company for Energy Conservation. In addition, TSMC was selected to Corporate Knights Magazine’s 2018 Global 100 Most Sustainable Corporations in the World index for the first time, and was also selected as a component of the Dow Jones Sustainability Indices for the 17th consecutive year, further strengthening the Company’s reputation. As an important member of the technology industry, TSMC has always endeavored to act as a positive force in society. The Company maintains a Corporate Social Responsibility Committee, which serves as a decision-making center and communications platform for CSR. Committee members represent departments including legal, customer service, materials management, quality and reliability, research and development, risk management, finance, investor relations, operations, environment, safety and health (ESH), human resources, the TSMC Education and Culture Foundation, the TSMC Charity Foundation, and public relations to coordinate the Company’s resources and collaborate to further enhance TSMC’s positive corporate reputation. Changes in Corporate Reputation and Impact on Company’s Crisis Management TSMC has established an excellent corporate reputation around the world based on its core values of integrity, commitment, To address crisis events that could affect the Company’s public reputation, including earthquakes, fires and workplace accidents, TSMC employs numerous preventative measures and maintains a “TSMC Crisis Command Center Control Instruction” 108 109 and a “TSMC Emergency Response Procedure” to establish its emergency response command structure. Each TSMC fab holds regular monthly meetings of the ESH committee, and relevant departments hold regular drills as well as continuously improve their emergency response and notification procedures to ensure clear channels of communication to stakeholders in crisis management. The public relations department serves as the designated window for external communications. In the event of an emergency, all departments immediately deploy emergency response measures to reduce casualties and minimize the impact on the surrounding environment, Company property and manufacturing operations. Responders also alert the public relations department at the first stage of response to ensure clear and consistent disclosure regarding the situation to maintain the Company’s reputation. Risks Associated with Change in Management In October 2017, Dr. Morris Chang, as TSMC Chairman for the last thirty years, announced his plan to retire from the Company immediately after the Annual Shareholders’ Meeting in early June, 2018. All present directors of the board, except himself, have unanimously agreed to be nominated, and if elected, will serve as directors of the board during the next term. They all have agreed to have TSMC under the dual leadership of Dr. Mark Liu and Dr. C.C. Wei, who are TSMC’s presidents and Co-CEOs currently. Dr. Liu will be the Chairman of the Board, and Dr. Wei will be the Chief Executive Officer. 6.3.4 Financial Risks Economic Risks ● Interest Rate Fluctuation TSMC is exposed to interest rate risks primarily related to its outstanding debt and investment portfolio, which are most sensitive to fluctuations in R.O.C. and U.S. interest rates. Changes in R.O.C. and U.S. interest rates affect the interest earned on the Company’s cash, cash equivalents and marketable securities and the fair value of those securities, as well as interest paid on and the fair value of its outstanding debt. As of December 31, 2017, all of TSMC’s term debt have fixed interest rates and are measured at amortized cost. As such, changes in interest rate would not affect the future cash flows. The primary objective of TSMC’s investment policy is to achieve a return that will allow the Company to preserve principal and maintain liquidity requirements. TSMC generally invests in investment grade fixed income securities and limits the amount of credit exposure to any one issuer. The Company’s investments in both fixed- and floating-rated fixed income securities carry a degree of interest rate risk. A majority of the Company’s fixed rate securities are classified as available-for-sale, and may have their market value adversely impacted due to the rise in interest rates. TSMC has entered, and may enter in the future, into interest rate futures to partially hedge the interest rate risk on its fixed income investments. These hedges may offset only a small portion of the financial impact from movements in interest rates. ● Foreign Exchange Volatility More than 90% of the Company’s sales were denominated in US dollar and over one-half of TSMC’s capital expenditures are denominated in currencies other than NT dollar, primarily in US dollar, Japanese yen and Euro. Because TSMC’s functional currency is denominated in NT dollar, any significant fluctuation to its disadvantage in such exchange rates would have an adverse effect on TSMC’s financial condition. For example, every 1 percent depreciation of the US dollar against the NT dollar would result in approximately 0.4 percentage point decrease in TSMC’s operating margin based on TSMC’s 2017 results. Conversely, if the US dollar appreciates significantly versus other major currencies, the demand for the products and services of TSMC’s customers and for its goods and services will likely decrease, which will negatively affect the Company’s revenue. TSMC may use derivative, such as currency forward contracts and cross-currency swaps, and non-derivative financial instruments, such as foreign currency-denominated debt, to partially hedge its existing and certain forecasted currency exposure. These hedges will offset only a portion of, but do not eliminate, the financial impact from movements in foreign currency exchange rates. Fluctuations in the exchange rate between the US dollar and the NT dollar may affect the US dollar value of the Company’s common shares and the market price of the Company’s American Depositary Shares (ADSs) and of any cash dividends paid in NT dollars on TSMC’s common shares represented by ADSs. ● Inflation, Deflation and Resulting Market Volatility The global economy is becoming more vulnerable to sudden unexpected fluctuations in inflationary and deflationary expectations and conditions. Expectations of high inflation and deflation each adversely affects the economy, at both macro and micro levels, by reducing economic efficiency and disrupting investment decisions. For example, recent implementation of “balance sheet normalization” program by the U.S. Federal Reserve and the possible changes in economic, fiscal and/or trade policies in the U.S. have exacerbated fluctuations in inflationary expectations. Such volatility may negatively affect the costs of TSMC’s operations and the business operations of its customers who may be forced to plan their purchases of TSMC’s goods and services within an uncertain economy. Therefore, the demand for TSMC’s products and services could unexpectedly fluctuate severely in accordance with expectations of inflation or deflation as affected by market volatility. Risks Associated with External Financing In times of market instability, sufficient external financing may not be available to the Company on a timely basis, on commercially reasonable terms to the Company, or at all. If sufficient external financing is not available, when TSMC needs such financing to meet its capital requirements, TSMC may be forced to curtail its expansion, modify plans or delay the deployment of new or expanded services until it obtains such financing. Risks Associated with High-Risk/Highly Leveraged Investments; Lending, Endorsements, and Guarantees for Other Parties; and Financial Derivative Transactions TSMC did not make high-risk or highly leveraged financial investments in 2017 nor up to the date of this annual report. TSMC provided a guarantee to TSMC Global, a wholly-owned subsidiary of TSMC, for its issuance of US dollar-denominated senior unsecured corporate bonds in April 2013. As of February 28, 2018, TSMC had intercompany loans of RMB$4.4 billion arranged among the Company’s subsidiaries, which were all in compliance with relevant rules and regulations. In 2017, the financial transactions of a derivative nature that TSMC entered into were strictly for hedging and not for any trading or speculative purposes. For more information, please refer to pages 33-34 of the annual report section (II), Financial Statements. The fair market value of TSMC’s trading and available-for-sale financial securities is subject to prevailing market conditions and may fluctuate from TSMC’s carrying value from time to time, which may impact the returns of those securities. To control various types of financial transactions, the Company has established internal policies and procedures based on sound financial and business practices, all in compliance with the relevant rules and regulations issued by the Taiwan Securities and Futures Bureau. TSMC policies and procedures include “Policies and Procedures for Financial Derivative Transactions,” “Procedures for Lending Funds to Other Parties,” “Procedures for Acquisition or Disposal of Assets,” and “Procedures for Endorsement and Guarantee.” Risks Associated with Impairment Charges Under Taiwan-IFRSs, TSMC is required to evaluate its investments, tangible assets and intangible assets for impairment whenever triggering events or changes in circumstances indicate that the asset may be impaired. If certain criteria are met, TSMC is required to record an impairment charge. TSMC is also required under Taiwan-IFRSs to evaluate goodwill for impairment at least on an annual basis or more frequently whenever triggering events or changes in circumstances indicate that goodwill may be impaired and the carrying value may not be recoverable. TSMC holds investments in certain publicly listed and private companies, some of which have incurred certain impairment charges as disclosed in Annual Report section (II), Financial Statements. The determination of an impairment charge at any given time is based significantly on the projected results of the Company’s operations over several years subsequent to that time. Consequently, an impairment charge is more likely to occur during a period when the Company’s operating results are otherwise already depressed. TSMC has established the process and system to closely monitor and assess the risk of impairment charge. However, the management is unable to estimate the extent or timing of any impairment charge for future years, or whether such impairment charge may have a material adverse effect on the Company’s net income. 110 111 6.3.5 Hazardous Risks TSMC maintains a comprehensive risk management system dedicated to the safety of people, the conservation of natural resources, and the protection of property. In order to effectively handle emergencies and natural disasters, at each facility management has developed comprehensive plans and procedures that focus on risk prevention, emergency response, crisis management and business continuity. The Company has adopted local and international standards for environmental, safety and health management. All TSMC manufacturing fabs have been ISO 14001 certified (environmental management system), OHSAS 18001 certified (occupational health and safety management system), and QC 080000 certified (hazardous substance process management system). All manufacturing fabs in Taiwan have also been TOSHMS (Taiwan Occupational Safety and Health Management System) certified. The new fabs will also attain the above certifications within 18 months after acquiring factory registration certification. The Company pays special attention to preparedness for emergencies or disasters, such as typhoons, floods, droughts caused by climate change, earthquakes, environmental contamination, large-scale product returns, service disruption of IT systems, strikes, pandemics (such as H1N1 influenza), and sudden, unexpected disruptions to the supply of raw materials, water, electricity and other public utilities. TSMC has established a company-wide taskforce dedicated to managing the risk of a water shortage that might arise due to climate change. This taskforce monitors the external supply and internal demand for water. Cross-company consolidations and external collaborations with public agencies are also ongoing in industrial parks to ensure and sustain a stable water supply. TSMC has further strengthened its business continuity plans, which include periodic risk assessment, risk mitigation, and implementation through the establishment of emergency taskforces when necessary, combined with the preparation of a thorough analysis of the emergency, its impact, alternative actions, and solutions for each possible scenario together with appropriate precautionary and/or recovery measures. Each taskforce is given the responsibility of ensuring TSMC’s ability to conduct business while minimizing personal injury, business disruption and financial impact under the circumstances. TSMC’s business continuity plan is periodically reviewed according to results of test scenarios or practical implementation to ensure effective and successful continuation of business activities. Customers are informed of TSMC’s strong business continuity capability in order to establish resilience and flexibility in both their supply chain and insurance needs. In response to the impact of the earthquake that occurred in southern Taiwan in February 2016, TSMC conducted a continuous improvement project, including enhancing earthquake emergency response, enhancing tool anchorage and seismic isolation facilities, preparedness for speeding up tool salvage and production recovery, and improved TSMC procedures with reference to ISO 22301 business continuity management. TSMC and many of its suppliers use combustible and toxic materials in their manufacturing processes and are therefore subject to risks that cannot be completely eliminated arising from explosion, fire, or environmental influences. Although the Company maintains many overlapping risk prevention and protection systems, as well as fire and casualty insurance, TSMC’s risk management and insurance coverage may not always be sufficient to cover all of the Company’s potential losses. If any of TSMC’s fabs or vendor facilities were to be damaged or cease operations as a result of an explosion, fire or environmental causes, it could reduce the Company’s manufacturing capacity and may lead to the loss of important sales and customers, thereby having a potentially adverse and material impact on TSMC’s financial performance. In addition to periodic fire-protection inspections and firefighting drills, the Company has also carried out a corporate-wide fire risk mitigation project focused on managerial and hardware improvements. 6.3.6 Risks Associated with Non-Compliance with Environmental and Climate Related Laws and Regulations, and with Other International Laws, Regulations and Accords Because TSMC engages in manufacturing activities in multiple jurisdictions and conducts business with customers located worldwide, such activities are subject to a myriad of governmental regulations. For example, the manufacturing, assembling and testing of TSMC’s products require the use of metals, chemicals and materials that are subject to environmental, climate-related, health and safety, and humanitarian conflict-free sourcing laws, regulations and guidelines issued worldwide. The Company’s failure to comply with any such laws or regulations, as amended from time to time, and our failure to comply with any information and document sharing requests from the relevant authorities in a timely manner could result in: ● significant penalties and legal liabilities, such as the denial of import permits or third party private lawsuits, criminal or administrative proceedings; ● the temporary or permanent suspension of production of the affected products; ● unfavorable alterations in TSMC manufacturing, fabrication and assembly and test processes; ● challenges from customers that place TSMC at a significant competitive disadvantage, such as loss of actual or potential sales contracts in case the Company is unable to satisfy the applicable legal standard or customer requirement; ● restrictions on TSMC operations or sales; ● loss of tax benefits, including termination of current tax incentives, disqualification of tax credit application and repayment of the tax benefits that the Company is not entitled to; and ● damages to TSMC’s goodwill and reputation. Complying with applicable laws and regulations, such as environmental and climate related laws and regulations, could also require TSMC, among other things, to do the following: (1) purchase, use or install remedial equipments; (2) implement remedial programs such as climate change mitigation programs; (3) modify product designs and manufacturing processes, or incur other significant expenses such as obtaining substitute raw materials or chemicals that may cost more or be less available for our operations. TSMC’s inability to timely obtain approvals necessary for the conduct of our business could impair our operational and financial results. For example, if the Company is unable to timely obtain environmental related approvals needed to undertake the development and construction of a new fab or expansion project, then such inability may delay, limit, or increase the cost of its expansion plans that could also in turn adversely affect its business and operational results. In light of increased public interest in environmental issues, TSMC’s operations and expansion plans may be adversely affected or delayed responding to public concern and social environmental pressures even if the Company complies with all applicable laws and regulations. TSMC believes that climate change should be regarded as a significant corporate risk that must be controlled to improve competitiveness. Climate change has the potential to create legal, physical and other risks. TSMC’s control measures are as follows: ● Climate Regulatory Risks Greenhouse gas (GHG) control regulations and agreements in countries around the world are becoming increasingly stringent. Enterprises are legally required to regularly disclose GHG-related information as well as limit GHG emissions. Future legal requirements, such as carbon or energy taxes and carbon emission cap-and-trade may drive up production costs, including material and energy costs. TSMC China is subject to the Shanghai carbon emission cap-and-trade regulation, which has had a cost impacts in 2016 and 2017. TSMC continues to monitor legislative trends and communicate with various governments through industrial organizations and associations to set reasonable and feasible legal requirements. ● Conflict Minerals Risks For additional details, please refer to the Supplier and Contractor Management section under ”7.2.3 Safety and Health” on page 130-131 of this annual report. ● Climate Disaster Risks Abnormal climate caused by the greenhouse effect has increased the frequency and severity of climate disasters – storms, floods, drought, and water shortages – causing considerable impacts on business operations and supply chains. TSMC believes that climate change control should take into account both mitigation and adaption, and this requires cooperation among government, society and industry to reduce risk. To sustain electricity and raw water supplies, therefore, in addition to water-saving measures the Company undertakes at its own facilities and those of upstream and downstream partners, TSMC participates in the Taiwan Science Park Industrial Union Experts Committee platform, and is actively involved in regular meetings with Taipower Company and the Taiwan Water Corporation to discuss supply and allocation issues and disaster responses. ● Other Climate Risks Climate change is a concern to the global supply chain, necessitating energy conservation, carbon reduction, and disaster prevention. For example, The Responsible Business 112 113 Alliance (RBA) has also required members’ suppliers to disclose GHG emissions information. TSMC not only discloses its own GHG emissions information each year, but it also assists and requires its major suppliers to establish a GHG inventory system and conduct reduction programs. TSMC insists that its major suppliers submit GHG emissions and reduction information as an important index of sustainability scoring in its procurement strategy. To mitigate risks resulting from climate change, TSMC continues to actively carry out energy conservation measures, participate in voluntary emission reduction projects for perfluorinated compounds (PFCs), and conduct GHG inventory and verification on an annual basis. TSMC has publicly disclosed climate change information annually through the following channels: ● TSMC has disclosed GHG emissions and reduction-related information for evaluation by the Dow Jones Sustainability Index every year since 2001. ● TSMC’s GHG-related information has been disclosed in its CSR report on the Company website annually since 2008. TSMC also provides information to customers and investors upon request. ● TSMC has participated in an annual survey conducted by the nonprofit Carbon Disclosure Project (CDP) since 2005. The survey includes GHG emission and reduction information for all TSMC fabs and subsidiaries. ● TSMC has followed the ISO 14064-1 standard to conduct a GHG inventory and acquire verification by an accrediting agency since 2006. TSMC also reports GHG inventory data to the Taiwan Environmental Protection Administration (EPA) and the Taiwan Semiconductor Industry Association (TSIA). 6.3.7 Other Risks Potential Impact and Risks Associated with Sales of Significant Numbers of Shares by TSMC’s Directors, and/or Major Shareholders Who Own 10% or More of TSMC’s Total Outstanding Shares The value of TSMC shareholders’ investment may be reduced by possible future sales of TSMC shares owned by major shareholders. One or more of TSMC’s existing shareholders may, from time to time, dispose of significant numbers of TSMC common shares or ADSs. For example, the National Development Fund of Taiwan, R.O.C. which owned 6.38% of TSMC’s outstanding shares as of February 28, 2018, has from time to time in the past sold TSMC shares in the form of ADSs in several transactions. As of the date of this annual report, no shareholder owns 10% or more of TSMC’s total outstanding shares. Risks Associated with Cyber Attacks Even though TSMC has established a comprehensive internet and computing security network, it cannot guarantee that the Company’s computing systems which control or maintain vital corporate functions ,such as its manufacturing operations and enterprise accounting, would be completely immune to crippling cyber attacks by any third party to gain unauthorized access to its internal network systems, to sabotage its operations and goodwill or otherwise. In the event of a serious cyber attack, TSMC’s systems may lose important corporate data and its production lines may be shutdown indefinitely pending the resolution of such attack. While TSMC also seeks to annually review and assess its cybersecurity policies and procedures to ensure their adequacy and effectiveness, it cannot guarantee that the Company will not be susceptible to new and emerging risks and attacks in the evolving landscape of cybersecurity threats. These cyber attacks may also attempt to steal TSMC’s trade secrets and other intellectual properties and other sensitive information, such as proprietary information of the Company’s customers and other stakeholders and personal information of the Company’s employees. Malicious hackers may also try to introduce computer viruses, corrupted software or ransomware into the Company’s network systems to disrupt its operations, blackmail it for regaining control of its computing systems or spy for sensitive information. These attacks may result in TSMC having to pay damages for its delayed or disrupted orders or incur significant expenses in implementing remedial and improvement measures to enhance the Company’s cybersecurity network, and may also expose the Company to significant legal liabilities arising from or related to legal proceedings or regulatory investigations associated with, among other things, leakage of customer or third party information which TSMC has an obligation to keep confidential. During 2017 and as of the date of this Annual Report, the Company had not been aware of any material cyber attacks or incidents that had or would expected to have a material adverse effect on its business and operations, nor had it been involved in any legal proceedings or regulatory investigations related thereof. In addition, the Company employs certain third party service providers for TSMC and its affiliates worldwide with whom the Company needs to share highly sensitive and confidential information to enable them to provide the relevant services. Despite that TSMC requires the third party service providers to comply with the confidentiality and/or Internet security requirements in its service agreements with them, there is no assurance that each of them will strictly fulfill such obligations, or at all. The on-site network systems of and the off-site cloud computing networks such as servers maintained by such service provider and/or its contractors are also subject to risks associated with cyber attacks. If TSMC or its service providers are not able to timely resolve the respective technical difficulties caused by such cyber attacks, or ensure the integrity and availability of its data (and data belonging to its customers and other third parties) or control of its or its service providers’ computing systems, the Company’s commitments to its customers and other stakeholders may be materially impaired and its results of operations, financial condition, prospects and reputation may also be materially and adversely affected as a result. Risks of Trade Policies As TSMC's revenue is primarily derived from sales to major economies in the world (please refer to "2.2.4 TSMC Position, Differentiation and Strategy" on page 14 of this annual report), any changes in the trade policies (such as the adoption of trade barriers) of such major economies can affect the sales of TSMC or its customers and thereby affect TSMC's operating results. Accordingly, TSMC continues to monitor the recent shifts in trade policies and measures among the relevant major economies and will take corresponding responsive actions in accordance with subsequent developments. Other Material Risks During 2017 and in 2018 as of the date of this annual report, TSMC’s management is not aware of any other risk event that could impart a potentially material impact on the financial status of the Company. 114 115 116 116 117 117 7. Corporate Social Responsibility 7.1 Overview TSMC is the global leader in dedicated semiconductor foundry services. In addition to succeeding in its core businesses, TSMC also diligently strives to carry out the responsibilities of a good corporate citizen. By pursuing and maintaining active, positive relationships with employees, shareholders/investors, customers, suppliers, government and society, TSMC seeks to create a sustainable future for all stakeholders and embraces “uplifting society” as its main vision. The Scope of Corporate Social Responsibility Corporate Social Responsibility Policy is TSMC’s overall guiding principle for sustainable development. Following the Company vision of Uplifting Society, the three primary missions of TSMC are: Acting with Integrity, Strengthening Environmental Protection, and Caring for the Disadvantaged. The CSR matrix below, put forward by Chairman Dr. Morris Chang, clearly defines the scope of that responsibility. The horizontal axis shows the seven areas where TSMC aims to set a benchmark for sustainability: morality, business ethics, economy, rule of law, sustainability, work/life balance and happiness, and philanthropy. On the vertical axis are actions that TSMC has taken to fulfill its responsibilities. TSMC CSR Matrix TSMC Integrity Law Compliance Anti-Corruption Anti-Bribery Anti-Cronyism Environmental Protection Climate Control Energy Conservation Corporate Governance Provide Well-Paying Jobs Good Shareholder Return Employees’ Work/Life Balance Encourage Innovation Good Work Environment TSMC Charity Foundation TSMC Education and Culture Foundation Society Morality Business Ethics Economy Rule of Law Sustainability Work/Life Balance Happiness Philanthropy V V V V V V V V V V V V V V V V V V V V V V CSR Management The Corporate Social Responsibility Committee is comprised of representatives from each functional unit within the Company and is chaired by the CFO. The committee serves as a decision-making center and cross-departmental communication platform for TSMC’s corporate social responsibility. As the highest-level CSR group within TSMC, the committee sets the Company’s CSR strategies, targets and vision for material issues of the year and monitors the execution of budgets and performance by each department. The committee meets each quarter to discuss issues of interest to stakeholders, namely employees, shareholders/investors, customers, suppliers, government, society, and others. It also coordinates among all departments regarding the issues of economic, environmental and social sustainability and monitors the progress and effectiveness of CSR projects. In 2017 the CSR committee focused on the establishment of the TSMC Charity Foundation, the proposals and discussion of “TSMC i-Charity Platform,” and CSR communication enhancement. Besides the regular meetings that are held quarterly, the chairperson of the CSR committee reports annually to the Board of Directors on implementation results for the year and the work plan for the upcoming year. The 2017 report focused on green manufacturing strategies and performance, fulfilling RBA Code of Conduct requirements with respect to supply chain management, setting targets to drive local procurement, and the achievements and highlights of TSMC Education and Culture Foundation, as well as TSMC Charity Foundation. The CSR plan for 2018 calls for TSMC to continue to align its sustainability targets with the United Nations Sustainability Development Goals (SDGs), expand its coverage of CSR management for TSMC’s overseas fabs and major affiliates, and execute social impact valuation projects. Functions related to CSR at TSMC include legal, customer service, materials management, quality and reliability, research and development, risk management, finance, investor relations, operations, environment, health and safety, human resources, the TSMC Education and Culture Foundation, the TSMC Charity Foundation, and public relations. By adhering to the vision and mission of TSMC Corporate Social Responsibility Policy, the guiding principles of corporate social responsibility policy are conveyed promptly and effectively to all departments, and are systematically implemented in the Company’s daily operations. Stakeholder Engagement TSMC values the rights and concerns of all its stakeholders. In order to understand the level of stakeholder interest in sustainability issues, TSMC conducted three studies focused on identification, prioritization and validation with regard to these material issues. Multiple and systematic channels were established to communicate with stakeholders including a “Stakeholder Engagement” section on the corporate website, as well as a CSR mailbox, an important channel for TSMC to gather views from the public. Submissions were sent to relevant departments according to the nature and range of the issues involved, and the Company’s dedicated personnel gave timely responses. In 2017, the TSMC CSR mailbox received 124 submissions, including requests for visits, inquiries about daily operations, suggestions and complaints from the public, and requests for endorsement, donation and collaboration, as well as event invitations. Stakeholders and Communication Channels in 2017 Stakeholders Employees Shareholders/Investors Customers Suppliers Government Society Communication Channels ● Corporate intranet, internal emails and other announcement channels (such as promotion posters at facilities) ● Human resources representatives ● Regular and ad-hoc communication meetings, such as manager development consulting committee, Operations engineer training committee, manufacturing department technical committee, etc. ● Employee voice channels, such as immediate response system, employee opinion box, wellness center, wellness website, each function’s PIP committee, employee PIP opinion dedicated line, etc. ● Ombudsman System ● Audit Committee Whistleblower System ● EWC event questionnaire survey ● Annual shareholder meeting ● Quarterly earnings conference call ● Investor conferences and meetings ● Telephone and email responses to investors’ questions and feedback collection ● Annual reports, CSR reports, 20-F filings to US SEC, material announcements to Taiwan Stock Exchange, and corporate news on the Company’s website ● Customer satisfaction survey ● Customer meetings ● Customer audits ● Email responses to the issues that customers are concerned about occasionally ● Supplier meetings ● Supplier onsite audits ● Supply chain management forum ● Supply chain ESH forum ● Supplier ethics code awareness training ● Official correspondence ● Meetings (such as communication meetings, public hearings, forums or seminars) ● Communication with government authorities through industry organizations, including the Association of Science Park Industries, Taiwan Semiconductor Industry Association, World Semiconductor Council, and Chinese National Federation of Industries ● Arts events in the communities ● Sponsorship of youth development events ● Sponsorship of non-profit organizations to support educational projects ● Professorship endowments and student scholarships at universities ● Support of non-profit organizations and institutions via monetary and in-kind donation, as well as providing necessary manpower for a good cause ● Regular visits to National Museum of Science, Hsinchu Veterans Home, St. Teresa Children Center, Jacana Ecology Education Park, remote schools and TSMC ecological parks to provide volunteer services ● Annual volunteer activities in collaboration with TSMC fabs and divisions 118 119 TSMC believes that no enterprise can exist in a vacuum separate from society. By maintaining proactive communications and positive relationships with all stakeholders in economic, environmental and social dimensions, TSMC is laying the foundation of an enterprise built to last and creating sustainable value for the Company and society going forward. 2017 CSR Awards and Recognitions Category Overall CSR Organization Awards and Recognitions Dow Jones Sustainability Indices (DJSI) ● Membership in the Dow Jones Sustainability World Index for the 17th consecutive year ● RobecoSAM Sustainability Award - Gold Class Responsibilities of TSMC CSR Committee Members Committee Members Responsibilities Legal Customer Service Materials Management Quality and Reliability Corporate Governance, Code of Conduct, Legal Compliance (including fair competition, privacy and personal information, and protection for whistle-blowers), Intellectual Property, Protection of Confidential Information Customers Service and Satisfaction, Customer Trust, Customer Confidentiality, RBA and its Code of Conduct Materials and Supply Chain Risk Management, Supplier Management, Conflict Minerals, RBA and its Code of Conduct Suppliers Product Quality and Reliability, Product Recall Mechanism Research and Development Innovation Management, Green Products Risk Management Risk Management, Crisis Management, Emergency Response and Action Plan Finance Financial Disclosure, Dividend Policy, Tax Strategy Investor Relations Operations Environment, Health, and Safety Resolving Issues of Stakeholder Concern, Establishing Trusting Long-term Relationships, Effective Two-way Communication, Annual Report Production Operational Eco-efficiency, Pollution Prevention, Water Resource Risk Management, Green Manufacturing Environmental Policy and Management System, Climate Change Mitigation and Adaption, Pollution Prevention, Energy Consumption Efficiency, Carbon Emissions and Carbon Rights Management, Product Environmental Responsibility, Response Mechanism for Environmental Issues, Environmental Spending, Green Supply Chain, Policy and Management Systems for Occupational Health and Safety, Workplace Health and Safety, Occupational Disease Prevention and Health Promotion, Communication of ESH Regulations Human Resources Talent Attraction and Retention, Proprietary Information Protection, Employees’ Physical and Mental Well-Being and Work-Life Balance, Labor-Management Relations and Employee Engagement, Labor Rights, Training and Development, Mobility, RBA and its Code of Conduct TSMC Education and Culture Foundation, TSMC Charity Foundation Philanthropy, Community Relations Public Relations Stakeholder Engagement, Mechanism for Reflecting Issues of Social Concern, Media Relations Note: Society includes community, non-governmental organizations, non-profit organizations, and the public. Stakeholders Employees Government Society (Note) Customers Customers Suppliers Employees Customers Suppliers Employees Investors Customers Suppliers Government Society Employees Investors Customers Suppliers Government Investors Customers Investors Suppliers Employees Investors Customers Suppliers Government Society Employees Society Society As the only semiconductor company chosen for the Dow Jones Sustainability World Indices over the past 17 consecutive years, TSMC is built on the cornerstone of integrity. TSMC believes that customer trust is enhanced if the Company follows the law and values corporate governance. Investors will be more willing to invest in the Company over the long term if the Company maintains solid financial performance and a sustainable dividend policy. Employees are TSMC’s most important asset and they have made a reciprocal commitment to the Company to fulfill its core values. At TSMC’s urging, suppliers – both upstream and downstream – have been devoting more resources to manufacturing processes and working together to build green factories and supply chains that are friendly to the environment. With the engagement of all stakeholders, TSMC combines the strengths that drive society forward, and hopes to build a better future together. MSCI ESG Indexes FTSE4Good Index FORTUNE Forbes ● Selected as MSCI ESG Leaders Indexes component ● Selected as MSCI SRI Indexes component ● Selected as FTSE4Good Emerging Index component ● Selected as FTSE4Good TIP Taiwan ESG Index component ● Selected as one of the World’s Most Admired Companies ● Selected as one of the Top Regarded Companies Institutional Investor Magazine ● Selected as Most Honored Company (Technology/Semiconductor) - All-Asia Newsweek oekom research AG Corporate Knights Taiwan Institute of Sustainable Energy ● Selected as Newsweek Green Rankings Top Green Companies in the World ● Rated “Prime” by oekom Corporate Rating ● Selected as one of the Global 100 Most Sustainable Corporations ● The Most Prestigious Sustainability Awards - Top Ten Domestic Corporates ● Taiwan Top 50 Corporate Responsibility Report Awards - IT & IC Manufacturing Industry - Gold Class ● Circular Economy Leadership Award ● Chairman Dr. Morris Chang was honored with Sustainability Lifetime Achievement Award Cheers Magazine ● Most Admired Company in Technology/Manufacturing Group for the New Generation Economy, Governance Institutional Investor Magazine IR Magazine FORTUNE Forbes ● Best CEO (Technology/Semiconductor) - 1st Place (buy-side and sell-side) - All-Asia ● Best CEO (Technology/Semiconductor) - 1st Place (buy-side) - All-Asia ● Best CEO (Technology/Semiconductor) - 1st Place (sell-side) - All-Asia ● Best CFO (Technology/Semiconductor) - 1st Place (buy-side and sell-side) - All-Asia ● Best CFO (Technology/Semiconductor) - 1st Place (buy-side) - All-Asia ● Best CFO (Technology/Semiconductor) - 1st Place (sell-side) - All-Asia ● Best Investor Relations Program (Technology/Semiconductor) - 1st Place (buy-side and sell-side) - All-Asia ● Best Investor Relations Program (Technology/Semiconductor) - 1st Place (buy-side) - All-Asia ● Best Investor Relations Program (Technology/Semiconductor) - 1st Place (sell-side) - All-Asia ● Best Investor Relations Professional (Technology/Semiconductor) - 1st Place (buy-side and sell-side) - All-Asia ● Best Investor Relations Professional (Technology/Semiconductor) - 1st Place (buy-side) - All-Asia ● Best Investor Relations Professional (Technology/Semiconductor) - 1st Place (sell-side) - All-Asia ● Best Analyst Days (Technology/Semiconductor) - 1st Place (buy-side and sell-side) - All-Asia ● Best Website (Technology/Semiconductor) - 1st Place (buy-side and sell-side) - All-Asia ● Global Top 50 ranking of the best investor relations programs ● Selected as member of Fortune Global 500 ● Forbes Global 2000 ● Chairman Dr. Morris Chang was honored as one of The World’s 100 Greatest Living Business Minds ● Selected as one of the Top Multinational Performers Clarivate Analytics ● Top 10 Global Innovators in Semiconductor Industry The Bizz Nikkei Taiwan Stock Exchange R.O.C. Ministry of Economic Affairs Intellectual Property Office PricewaterhouseCoopers ● Award for Business Excellence ● Nikkei Asia 300 Indexes ● Ranked in top 5% in Corporate Governance Evaluation of Listed Companies for the 3rd consecutive year ● Selected as TWSE Corporate Governance 100 Index component ● Ranked No.1 in Top 100 Invention Patent Filers in Taiwan ● Ranked No.1 in Taiwan by PricewaterhouseCoopers Global Innovation 1,000 Study ● Listed in Global Top 100 Companies by market capitalization China Credit Information Service ● Ranked No.1 in Profitability of large Taiwan Companies CommonWealth Magazine ● The company with the highest net profit in Top 2,000 Survey (Continued) 120 121 Category Organization Awards and Recognitions Environment, Safety and Health U.S. Green Building Council Leadership in Energy and Environmental Design (LEED) certification ● “Gold” class certification - Fab 12 Phase 3 Manufacturing Facility and Office Building, Advanced Backend Fab 2 R.O.C. Ministry of the Interior “Ecology, Energy Saving, Waste Reduction and Health (EEWH)” certification R.O.C. Environmental Protection Administration R.O.C. Ministry of Economic Affairs Hsinchu Science Park Administration ● “Diamond” class certification - Fab 14 Phase 7 Manufacturing Facility ● “Gold” class certification - Fab 12 Phase 7 Manufacturing Facility, Fab 14A ● Enterprise Green Procurement Award - Fab 2 and Fab 5, Fab 6, Fab 8, Fab 12A, Fab 14A, Fab 14B, Advanced Backend Fab 2 ● Environmental Education Award - Fab 14A ● Excellence in Carbon Reduction Award - Fab 2 and Fab 5, Fab 6 ● Excellence in Energy Conservation - Fab 14B ● Green Factory Label - Fab 12A, Fab 14B ● Water Conservation Award - Fab 2 and Fab 5, Fab 12 Phase 7 ● Excellence in Labor Safety and Hygiene Award - Fab 2 and Fab 5, Fab 12A, Fab 12 Phase 6 ● Excellence in Waste Reduction and Resource Recycling Award - Fab 2 and Fab 5 ● Excellence in Environmental Education Partner Award - Fab 2 and Fab 5 ● Safety and Health Expert Platform Outstanding Contribution Award - Fab 2 and Fab 5 ● Safety and Health Outstanding Contribution Award - Fab 2 and Fab 5 Central Taiwan Science Park Administration ● Excellence in Labor Safety and Hygiene Award - Fab 15A ● Enterprise Green Procurement Award - Fab 15A Southern Taiwan Science Park Administration ● Excellence in Environmental Protection - Fab 14B Hsinchu County Environmental Protection Bureau Hsinchu City Environmental Protection Bureau ● Enterprise Green Procurement Award - Fab 2 and 5, Fab 12A ● Enterprise Road Adoption Award - Fab 12 Phase 6 ● Enterprise Green Procurement Award - Fab 8, Fab 12A ● Enterprise Environmental Protection Evaluation - Fab 12A Society Forbes ● Selected as one of the World’s Best Employers Tainan City Environmental Protection Bureau ● Enterprise Green Procurement Award - Fab 6, Fab 14A, Fab 14B, Advanced Backend Fab 2 Taiwan Stock Exchange ● Selected as Taiwan High Compensation 100 Index component ● Selected as Taiwan Employment Creation 99 Index component R.O.C. Ministry of Labor ● Excellence in Labor Safety and Hygiene Award - Fab 2 and Fab 5 7.2 Environmental, Safety and Health (ESH) Management TSMC believes its environmental, safety and health practices must not only meet legal requirements, but should also measure up to or exceed recognized international best practices. TSMC’s ESH policies aim to reach the goals of “zero incident” and “sustainable development,” and to make TSMC a world-class company in environmental, safety and health management. The Company’s strategies for reaching these goals are to comply with regulations, promote safety and health, strengthen recycling and pollution prevention, manage ESH risks, instill an ESH culture, establish a green supply chain, and fulfill its related corporate social responsibilities. All TSMC manufacturing facilities have received ISO 14001: 2015 certification for environmental management systems and OHSAS 18001: 2007 certification for occupational safety and health management systems. All fabs in Taiwan have also been TOSHMS (Taiwan Occupational Safety and Health Management System) certified since 2009. TSMC strives for continuous improvement and actively seeks to enhance climate-change management, pollution prevention and control, power and resource conservation, waste reduction and recycling, safety and health management, fire and explosion prevention as well as to minimize the impact of earthquake damage, so as to reduce overall environmental, safety and health risks. In 2006, in order to meet regulatory and customer needs for the management of hazardous materials, TSMC began to adopt the IECQ QC 080000 Hazardous Substance Process Management (HSPM) System. All TSMC manufacturing facilities have been QC 080000 certified since 2007. By practicing QC 080000, TSMC ensures that its products comply with regulatory and customer requirements, including the European Union’s “Restriction of Hazardous Substances (RoHS) Directive,” the EU’s “Registration, Evaluation, Authorization and Restriction of Chemicals (REACH),” the “Montreal Protocol on Substances that Deplete the Ozone Layer” (the halogen free in electronic products initiative), Perfluorooctane Sulfonates (PFOS), Perfluorooctanoic acid (PFOA) and its related substances restriction standards. In response to “Water Pollution Control Act,” Article 14-1, enterprises must reduce hazardous substance in discharged wastewater to lower environmental and human health risks, TSMC started a reduction project for a hazardous substance, n-methylpyrrolidinone (NMP), to avoid discharging to wastewater. This project is scheduled for completion in 2018. Since 2011, TSMC has adopted the ISO 50001 Energy Management System for the continuous improvement of energy conservation. TSMC’s Fab 12 Phase 4 data center is Taiwan’s first facility to earn the ISO 50001 certification for a high-density computing data center. As of 2016, TSMC has three fabs – Fab 12 Phase 4/5/6, Fab 14 Phase 3/4 and Fab 15 – that earned ISO 50001 certifications. Other TSMC fabs also implement energy management measures consistent with ISO 50001. In order to establish the healthiest workplace possible, in 2017 TSMC formed a corporate-level health promotion committee, led by two vice presidents of operations. Committee members included site directors, Safety and Health department managers, Wellness, HR and Legal Affairs etc., as well as external experts invited in to discuss the potential risks of occupational diseases in semiconductor manufacturing and develop occupational disease prevention plans. To minimize health risks to employees, suppliers, and contractors in the workplace, TSMC adopted rigorous safety and health control measures designed to prevent occupational injuries and diseases and promote employee safety and mental health. To mitigate the supply chain risk and fulfill corporate social responsibility, TSMC not only does its best to manage ESH but also strives to improve ESH performance of its supply chain through audits and counselling. Since 2007, TSMC has used priority work management and self-management to govern work performed by contractors. We require contractors performing level-one high-risk operations to complete certification for technicians and to establish their own OHSAS 18001 safety and health management system. This promotion of self-management is aimed at increasing the sense of responsibility of TSMC’s contractors, with the goal of promoting safety awareness and technical improvement for all contractors in the industry. For on-site contractor personnel, in 2017 TSMC began to standardize safety and health training courses and increase their frequency, with the aim of improving training effectiveness and safety awareness. To facilitate the program and mitigate on-site operational risks, TSMC has initiated to establish a two-way electronic communication platform that enables instant requirements delivery. TSMC collaborates with suppliers to improve the sustainability of the Company’s supply chain regarding ESH-related issues, such as environmental protection, safety and hygiene code compliance, hazardous substance management, fire protection, and natural disaster mitigation. TSMC not only performs ESH audits at its suppliers’ manufacturing sites but also proactively assists them with improving ESH performance. TSMC also monitors potential climate-change related risks in the supply chain, requests suppliers to conduct carbon emissions inventory and encourages suppliers to implement measures to save energy, reduce carbon emissions, conserve water and reduce waste. In recent years, TSMC suppliers’ performance on pollution control and safety management has made good progress in procedure establishment and implementation; so TSMC takes a step further to pay more attention to occupational hygiene issues directly related to labor health. In 2017, TSMC and the Ministry of Labor Occupational Safety and Health Administration (OHSA) jointly launched the “Semiconductor Supply Chain Safety and Health Promotion Project”. TSMC invited suppliers to participate in the project. As engaged by OSHA, a professional team has taken on the responsibility of providing consultation through document review and on-site inspection to participating suppliers on management procedures and hardware setup in order to improve the working environment and labor health management. 7.2.1 Environmental Protection Greenhouse Gas (GHG) Emission Reduction TSMC actively participates in the World Semiconductor Council (WSC) in its efforts to set up a global voluntary PFC (perfluorinated compounds) emissions reduction goal for the 2011 to 2020, and has incorporated past experience to develop best practices. The implementation of best practices has been adopted by the WSC as a major element of the 2020 goal. In 2013, in accordance with the “EPA Early Actions for Carbon Credit of Greenhouse Gases Reduction” regulation, TSMC applied for the recognition of greenhouse reduction 122 123 from 2005 to 2011 that committed to the WSC and EPA, and received 5.28 million tons of carbon dioxide credits in 2015. Those carbon credits can be used to offset greenhouse gas emissions of new manufacturing facilities regulated by Environmental Impact Assessment (EIA) Act. The mitigation of climate-change risk supports the Company’s sustainable operations. In 2005, TSMC was the leading semiconductor company to complete the GHG (Greenhouse Gas) inventory program and take a complete inventory of its GHG emissions and to gain ISO 14064 certification. The purpose of the inventory is to serve as a baseline reference for TSMC’s strategy to reduce GHG emissions, to meet domestic regulatory requirements, and to prepare for carbon trading and corporate carbon asset management. All TSMC facilities conduct an annual GHG inventory. The inventory shows that the major direct GHG emissions are PFCs, which are used in the semiconductor manufacturing process. The primary indirect GHG emission is electricity consumption. In order to cope with the global climate change and the R.O.C. “Greenhouse Gas Reduction and Management Act” promulgated in 2015, TSMC initiated a cross-functional platform for corporate carbon management in 2016. The three focuses of this platform are legal compliance, carbon emission reduction, and carbon credit acquisition. In addition to participating in official regulatory consultation and communications meetings, TSMC also sets medium- and long-term reduction targets through the “Energy and Carbon Reduction Committee” led by VPs of operations, which are carried out by energy and carbon reduction teams of individual fabs, as the Company continues to strengthen climate mitigation and adaption. Because 70% of GHG emissions come from electricity consumption, TSMC emphasizes energy saving and carbon reduction initiatives. TSMC has not only adopted energy-conserving designs in its manufacturing fabs and offices, but has also continuously improved the energy efficiency of its facilities during operation. These efforts simultaneously reduce both carbon dioxide gas emissions and costs. Since 2015, TSMC has actively participated in the R.O.C. Ministry of Economic Affairs’ voluntary “Green Power Purchasing Program” for three consecutive years. In 2017, TSMC was the largest green power purchaser in Taiwan, purchasing 100 million kilowatt hours (kWh) of green power that made up nearly 50% of the Taiwan Power Company’s total green power available for purchase under the program in that year. Since green power is generated with zero carbon emissions, the purchase of 100 million kWh of green power will eliminate over 52.9 million kilograms of CO2 emissions, equivalent to the carbon absorbed by approximately 5.3 million trees in one year. TSMC hopes that by supporting Taiwan’s renewable energy efforts, it can continue to pursue sustainability, promote a low-carbon environment, and reduce the impact of global warming. We also promise that in the future, renewable energy sources will be purchased directly under the conditions of regulatory and market supply. This is a clear manifestation of the Company’s active support of the United Nations Sustainable Development Goals (SDGs). Air and Water Pollution Control The Company has installed effective air and water pollution control equipment in each wafer fab to meet regulatory emissions standards. In addition, TSMC maintains backup pollution control systems, including emergency power supplies, to lower the risk of pollutant emission in the event of equipment failure. TSMC centrally monitors the operations of its air and water pollution control equipment around the clock and treats system effectiveness as an important tracking item to ensure the quality of emitted air and discharged water. To make the most effective use of Taiwan’s limited water resources, all TSMC fabs strive to increase water reclamation rates by adjusting the water usage of manufacturing equipment and improving wastewater reclamation systems. All fabs meet or exceed the process water reclamation rate standard of the Science Park Administration. New fabs are able to reclaim more than 85% of process water, outperforming most semiconductor fabs around the world. TSMC also makes every effort to reduce non-manufacturing-related water consumption, including water used in air conditioning systems, sanitary facilities, cleaning and landscaping activities and kitchens. TSMC uses an intranet website to collect and measure water recycling volumes company-wide. Since water resources are inherently local, TSMC shares its water saving experiences with other semiconductor companies through the Association of Science-Based Industrial Park to promote water conservation in order to achieve the Science Park’s goals and ensure a long-term balance of supply and demand. Waste Management and Recycling The Company has a designated unit responsible for waste recycling and disposal. To meet the goal of sustainable resource utilization, TSMC’s priorities are: (1) reduce process waste; (2) onsite reuse; and (3) offsite recycling. The last option consists of treatment or disposal. To achieve raw material reduction, resource recycling and the goal of zero waste, for example TSMC built an in-house waste sulfuric acid pre-treatment system as electronic grade sulfuric acid can be used as waste water treatment agents after the wafer fabrication process. In order to track waste flow and ensure that all waste is treated or recycled legally and properly, TSMC carefully selects waste disposal and recycling contractors and performs annual audits of certification documents and site operations. TSMC also takes proactive steps to strengthen vendor auditing effectiveness. For example, all waste transportation contractors were asked and agreed to join the “GPS Satellite Fleet” so that all the cleanup transportation routes and abnormal stays for all trucks can be traced. In addition, all waste recycling and treatment vendors have installed closed-circuit TV systems at operating sites to monitor and audit the waste handling. Meanwhile, TSMC also conducts an ongoing survey of recycling product tracking. These actions were taken to ensure lawful and proper waste recycling and treatment. In 2017, TSMC’s fabs in Taiwan achieved a 95% waste recycling rate for the ninth consecutive year, with a landfill rate below 1% for the eighth consecutive year. Also during the year, TSMC amended its articles of incorporation to add four business items for chemical materials to ensure waste flow and reduce risks of improper waste disposal by commissioned agencies. TSMC also set up on-site resource activation facilities to regenerate waste resources produced from process activities into products to provide on-site or sell to other factories so as to become the leading company for waste resources regeneration. Also in 2017, TSMC not only regenerated used copper sulfate into copper tubes but also took the further step of collaborating with raw material suppliers to produce electronic grade copper anodes using copper tubes regenerated in the TSMC manufacturing process. Environmental Accounting The purpose of TSMC’s environmental accounting system is to identify and calculate environmental costs for internal management. At the same time, the Company can also evaluate the savings or economic benefits of environmental protection programs so as to promote cost-effective programs. While environmental expenses are expected to continue growing, environmental accounting can help TSMC manage these costs more effectively. TSMC’s environmental accounting measures various environmental costs, establishes independent environmental account codes, and provides these to all units for use in annual budgeting. The Company’s economic benefit evaluation calculates cost savings for reduction of energy, water or waste and benefits from waste recycling in accordance with its environmental protection programs. The environmental benefits disclosed in this report include real income from projects such as waste recycling and savings from major environmental projects. In 2017, 719 environmental projects of TSMC fabs were completed and the total benefits, including waste recycling, were more than NT$2,370 million. 2017 Environmental Cost of TSMC Fabs in Taiwan Unit: NT$ thousands Classification 1. Direct Costs for Reducing Environmental Impact Description Expense Investment (1) Pollution Control Cost Fees for air pollution control, water pollution control, and others (2) Resource Conservation Cost Costs for resource (e.g. water) conservation (3) Indistrial Waste Disposal and Recycling Costs for waste treatment (including recycling, incineration and landfill) 2. Indirect Cost for Reducing Environmental Impact (Environmental Managerial Cost) 3. Other Environmental Costs Total (1) Cost of training (2) Environmental management system and certification expenditures (3) Environmental impact measurement and monitoring fees (4) Environmental protection product costs (5) Environmental protection organization fees (1) Costs for decontamination and remediation (2) Environmental damage insurance fees and environmental taxes and expenses (3) Costs related to environmental settlement, compensations, penalties and lawsuits 4,560,760 - 1,718,891 260,889 3,771,513 1,012,000 - 173,243 - - 6,540,540 4,956,756 124 125 2017 Environmental Efficiency of TSMC Fabs in Taiwan Unit: NT$ thousands Category Description 1. Cost Savings of Environmental Protection Energy savings: completed 452 projects Projects Water savings: completed 15 projects Waste reduction: completed 252 projects 2. Real Income from Industrial Waste Recycling Recycling of used chemicals, wafers, targets, batteries, lamps, packaging materials, paper cardboard, metals, plastics, and other waste Total Efficiency 1,280,000 25,170 814,000 251,000 2,370,170 Green Building and Green Factory Since 2006 TSMC has adopted standards from both the Taiwan “Green Building” and the evaluation of the U.S. Green Building Council - Leadership in Energy and Environmental Design (LEED) for new fab and office building designs to achieve better energy and resource efficiency than conventional designs. During this time, TSMC has also continued to upgrade existing office buildings to comply with the LEED standard each year. From 2008 to 2017, 24 of TSMC’s fabs and office buildings have achieved LEED certifications (3 platinum-class and 21 gold-class). Meanwhile, TSMC also received 5 Taiwan Intelligent Building diamond class certifications and 19 Taiwan EEWH (ecology, energy saving, waste reduction and health) certifications (16 diamond-class, 3 gold-class). TSMC believes that more manufacturing companies should convert their facilities into green factories to improve the environment and lower construction costs. Therefore, the Company freely shares its practical experience with industry, government and academia. As of the end of 2017, 11,522 visitors from 300 different industrial, government, academic and general community groups had contacted TSMC to gain an understanding of the Company’s green factory practices. Since 2009, TSMC has led the industry in support of the Taiwan government’s “Green Factory Labeling System,” a system that includes “Clean Production Evaluation” and “Green Factory Evaluation”. TSMC received Taiwan’s first “Green Factory Label” and 9 labels in total as of the end of 2017. 7.2.2 Sustainable Products TSMC collaborates with its upstream material and equipment suppliers, design ecosystem partners and downstream assembly and testing service providers to minimize environmental impact. We reduce the resources and energy consumed for each unit of production and are able to provide more advanced, power efficient and ecologically sound products, such as Near-Vt (Near Threshold Voltage, NVT) chips for wearables and Internet of Things (IoT), ultra-low power chips for narrowband IoT, low power chips for mobile devices, high-efficiency LED driver chips for flat panel display backlighting, indoor/outdoor solid state LED lighting, “Energy Star” certified low standby AC-DC adaptors chips, and high-efficiency DC brushless motor chips, etc. By leveraging TSMC’s superior energy-efficient technologies, these chips support sustainable city infrastructure, greener vehicles, smart girds, and other applications. In addition to helping customers design low-power consumption, high-performance products to reduce resource consumption over the product’s life cycle, TSMC’s green manufacturing practices provide further “Green Value” to customers and other stakeholders. TSMC-manufactured ICs are used in a broad variety of applications covering various segments of the computer, communications, consumer, industrial and other electronics markets. Through TSMC’s manufacturing technologies, customers’ designs are realized and their products are incorporated into people’s lives. These chips, therefore, make significant contributions to the progress of modern society. TSMC works hard to achieve profitable growth while providing products that add environmental and social value. Listed below are several examples of how TSMC-manufactured products significantly contribute to the environment and society. Environmental Contribution by TSMC Foundry Services 1. Continue to Drive Technology to Lower Power Consumption and Save Resources ● To improve sustainability, TSMC continues to drive the development of advanced semiconductor process technologies to support customer designs that result in the most advanced, energy-saving and environmentally friendly products. In each new technology generation, circuitry line widths shrink, making transistors smaller and reducing product power consumption. ● As TSMC quickly ramped up its 28nm and newer generation technologies, the combined wafer revenue contribution grew significantly from 12% in 2012 to 58% in 2017. TSMC’s objective is to continue R&D efforts and to increase the wafer revenue contribution in 28nm and beyond technologies, helping the Company achieve both profitable growth and sustainability. TSMC Wafer Revenue Contribution from 28nm and Beyond Technologies 2013 30% 2014 42% 2015 48% 2016 54% 2017 58% Chip Die Size Cross-Technology Comparison Die size reduces as line width shrinks 1 0.53 0.48 0.25 0.11 0.068 0.048 55nm 45nm 40nm 28nm 16FFC/12FFC 10nm 7nm Chip Total Power Consumption Cross-Technology Comparison More power is saved as line width shrinks 1 0.6 0.3 0.07 0.06 N55LP (1.2V) N40LP (1.1V) N28HPM N16FFC/12FFC (0.9V) (0.8V) 10nm (0.75V) 0.04 7nm (0.75V) 2. Provide Customers Leading Power Management IC Process with the Highest Efficiency ● TSMC’s leading manufacturing technology helps customers design and produce green products. Power management ICs, the key components that supply and regulate power to all other IC components, are the most notable green IC products. TSMC helps customers produce industry-leading power management chips with more stable and efficient power supplies and lower energy consumption. ● In 2017, TSMC’s HV/Power technologies collectively shipped more than 2.5 million 8-inch equivalent wafers to customers. In total, power management ICs manufactured by TSMC accounted for more than one-third of global computer, communication and consumer systems. HV/Power Technologies Shipments (Unit: 8-inch equivalent wafer) 2013 2014 2015 2016 2017 >1,300K >1,800K >2,000K >2,100K >2,500K 3. Drive Industry-leading, Comprehensive Ultra-low Power (ULP) Technology Platform To meet low-power consumption requirements for the wearable and IoT markets, TSMC continues to invest in expanding and enhancing its ultra-low power processes. TSMC provides industry’s leading and comprehensive ultra-low power (ULP) technology platform to support innovations for IoT and wearable applications. TSMC’s leading offerings, including 55nm ULP, 40nm ULP, 28nm ULP, 22nm ULP/ULL (ultra-low leakage), have been widely adopted by various IoT and wearable applications. TSMC extends its offering with NVT (Near Threshold Voltage) technology for extreme low power applications. In 2017, TSMC uses its leading 40nm NVT technology to power the world’s lowest energy consumption wearable connected device and IoT solutions for customer. 4. Develop Greener Manufacturing to Lower Energy Consumption TSMC continues to develop more advanced and efficient technologies to reduce energy/resource consumption and pollution per unit during the manufacturing process as well as power consumption and pollution during product use. In each new technology generation, circuitry line widths shrink, making circuits smaller and lowering the energy and raw materials consumed for per unit in manufacturing. In addition, the Company continuously provides process simplification and new design methodology based on its manufacturing excellence to help customers reduce design and process waste so as to produce more advanced, energy-saving and environmentally- friendly products. For total energy savings and benefits 126 127 realized in 2017 through TSMC’s green manufacturing, see “Environmental Accounting“ on page 125-126 in this annual report. Social Contribution by TSMC Foundry Services 1. Unleash Customers’ Mobile and Wireless Chip Innovations that Enhance Mobility and Convenience ● The rapid growth of smartphones and tablets in recent years reflects strong demand for mobile devices, which, in turn, offer remarkable convenience. TSMC contributes significant value to these devices in the following ways: (1) new TSMC process technologies help chips achieve faster computing speeds in a smaller die area, leading to smaller form factors for these electronic devices. In addition, TSMC SoC technology integrates more functions into one chip, reducing the total number of chips in electronic devices, again resulting in a smaller system form factor; (2) new TSMC process technologies also help chips reduce power consumption. Mobile devices can therefore be used for a longer period of time; and (3) TSMC helps spread the growth of more convenient wireless connectivity such as 3G/4G and WLAN/ Bluetooth, meaning people can communicate more efficiently and “work anytime and anywhere,” significantly improving the mobility of modern society. ● Mobile computing related segments, such as baseband, RF transceivers, application processors (AP), wireless local area networks (WLAN), CMOS image sensors, near field communication (NFC), Bluetooth, and global positioning systems (GPS) among others, represented 50% of TSMC wafer revenue in 2017. TSMC Wafer Revenue Contribution from Mobile Computing Related Products 2013 44% 2014 48% 2015 51% 2016 52% 2017 50% Note: Mobile computing related products were re-classified in 2014. 2. Unleash Customers’ CIS (CMOS image sensor) and MEMS (Micro-electromechanical Systems) Innovations that Enhance Human Health and Safety TSMC continues to enhance or develop innovative CIS and MEMS technologies, which are extended from traditional sensing to machine sensing, such as NIR (near infrared), ultrasound, and micro-actuators. These new technologies can support more product applications, from smartphones and consumer electronics to automotive and health services. By combining advantages of traditional sensing and machine sensing, new products using TSMC CIS and MEMS technologies can be made smaller and faster, consume less power, and greatly enhance human convenience, health, and safety. For instance, TSMC customers’ CIS and MEMS products are used in a number of advanced medical treatments as well as in preventative health care applications. Examples include early warning systems to minimize the injury from falls for the elderly, systems to detect physiological changes, car safety systems and other applications that significantly improved human health and safety. 7.2.3 Safety and Health Safety and Health Management TSMC’s safety and health management is built on the framework of the OHSAS 18001 system and adheres to the management principle of “Plan, Do, Check, Act” to prevent accidents, promote employee safety and health and protect Company assets. All TSMC fabs in Taiwan have also received TOSHMS (Taiwan Occupational Safety and Health Management System) certification. Besides accident prevention, TSMC has established emergency response procedures to protect employees and contractors if a disaster should occur, as well as to prevent and/or reduce the negative impact on society and the environment. TSMC continually communicates with its suppliers to ensure that potential risk in the operation of production equipment is minimized, and rigorously follows safety control procedures when installing production equipment. The Company places stringent controls on high-risk operations and also evaluates the seismic tolerance of its facilities and equipment to reduce the risk of earthquake damage. For epidemics, TSMC has established company-level prevention committees and procedures for emergency response to outbreaks of infectious diseases. Working Environment and Employee Safety and Health Protection TSMC’s ESH policy is focused on establishing a safe working environment, preventing occupational injury and illness, keeping employees healthy, enhancing every employee’s awareness and sense of accountability to ESH, and building an ESH culture. TSMC safety and health management operations apply to: ● Equipment Safety and Health Management In addition to meeting regulatory requirements and internal standards, as well as mitigating ESH-related risks when building or upgrading facilities, TSMC also maintains procedures governing new equipment and raw materials, requires safety approvals for bringing new tools online, updates safety rules, and implements seismic protection and other safety measures. TSMC requires that all new tools meet SEMI-S8 requirements and that appropriate supplementary control measures be taken to reduce ergonomic risk. Moreover, TSMC endeavors to automate 300mm front-opening unified pod (FOUP) transportation to prevent accumulative physical damage caused by repetitive manual handling of 300mm FOUPs. TSMC 300mm fabs have completed automatic transportation control. ● Environmental, Safety and Health Evaluation of New Tools and New Chemical Substances As a technology leader in the global semiconductor industry, TSMC operates many diversified process tools and introduces new chemicals in the R&D stage. Before using those new tools and new chemicals, they are reviewed carefully by the “New Tools and New Chemical Review Committee”. The purpose is to ensure that new tools are compliant with the semiconductor industry’s safety standards (such as SEMI S2) and that new chemicals’ environmental, safety and health concerns can be well controlled, including engineering controls, application of personal protection equipment, and operational safety training during storage, transportation, usage and disposal. ● General Safety Management, Training and Audit All TSMC manufacturing facilities hold environmental, safety and health committee meetings on a monthly basis. TSMC adopts multiple preventive measures such as controls on high-risk work, contractor management, chemical safety management, personal protective equipment requirements, and safety audit management. In addition, the Company maintains detailed disaster response procedures and performs regular drills designed to minimize harm to employees and property, as well as the impact on society and the environment in the event of a disaster. ● Working Environment Hazardous Factors Management TSMC conducts workplace hazard assessments to provide a comfortable and safe workplace to employees. TSMC also requires employees to use personal protective equipment (PPE) to prevent hazardous exposures. TSMC performs semi-annual workplace environment assessments of physical and chemical hazards, including CO2 concentration, illumination, noise, and hazardous chemical substances regulated by local laws. The Company has performed exposure assessments and used hierarchy management control for chemicals with potential health hazards since 2015. If abnormal measurements or events happen or an exposure assessment indicates there is an adverse health effect for employees, ESH professionals immediately conduct onsite observation and interventions to reduce the exposure to acceptable levels. ● Health Promotion Program In order to establish the healthiest possible workplace and prevent from occurrence of occupational disease, TSMC formed a corporate-level committee charged with three tasks to execute health promotion programs covering three scopes: (1) Exposure assessment and health risks assessment: develop an exposure assessment system to identify high health risk employees. (2) Hazardous training and notification: use standardized training materials for employee, and contractors in all TSMC fabs. Let them understand the health risks and prevention measures at workplace before working or providing any services there. (3) Strengthen management of high health concerned chemicals: sample raw materials used in the manufacturing process to confirm that they do not contain any carcinogenic, mutagenic or toxic-reproductive materials. Suppliers were required that all materials provided to TSMC must comply with applicable laws including clear disclosure of any hazardous substances. ● Emergency Response The planning and execution of an effective emergency response should identify potential high-risk events via risk assessment and be prepared for various scenarios. It should focus on continuous improvement and practice drills covering all potentially severe events. TSMC’s emergency response plans include procedures for rapid-response crisis management and disaster recovery to potential incidents. All TSMC fabs conduct major annual emergency response exercises and evacuation drills. TSMC’s Tainan site fabs continue their spot drills, which have been recognized as best practice in the industry. TSMC’s onsite service contractors are required to participate in emergency response planning and exercises to ensure cooperation in handling accidents and to effectively minimize any damage caused by disasters. At least every two years, each fab director invites fab management and support functions to participate in crisis management drills for potentially high-risk events such as earthquake, fire and flood (Tainan site). In addition to the regular emergency response drills held by engineering and facilities departments each quarter, the Company’s laboratory, canteen, dormitory, and shuttle bus 128 129 personnel also hold emergency response drills to prepare for events such as earthquakes, chemical spills, ammonia release, fires and traffic accidents. ● Emerging Infectious Disease Response TSMC has a dedicated corporate ESH organization to monitor emerging infectious diseases around the world, to assess any potential impact on the workplace, and to provide an appropriate strategic response plan. In previous outbreaks (such as SARS in 2003 and the H1N1 influenza outbreak in 2009), TSMC convened the corporate influenza response committee to develop the Company’s strategies. These strategies include educating employees in prevention and response, publishing guidelines for managers, establishing guidelines for employee sick leave due to flu, and installing alcohol-based hand sanitizers at appropriate locations. The Committee also monitors the status of employee leave due to illness and, at the same time, develops a continuity plan to address manpower shortages and minimize business impact. ● Employee Physical and Mental Health Enhancement TSMC believes that employees’ physical and mental health is not only fundamental to maintaining normal business operations but also part of a corporation’s responsibility. To protect and promote employee physical and mental health, TSMC fosters collaboration among the onsite industrial safety and environmental protection department, onsite medical personnel of the health center, and physicians of occupational medicine. TSMC strives to reduce cardiovascular disease that might be induced or aggravated by overwork, night work or shift work, and conducts maternal health protection programs as well. TSMC devotes significant resources to mental health awareness and related activities, which not only protect employees from hazards at work but also proactively promote employee health in general. In 2017, through planned personal health management, the personnel diagnosed at middle and high risk for cardiovascular disease has decreased from 0.62% to 0.54%. 710 female employees participated in the maternal health program were all at the first degree risk (there was no harm to the mother, infant, and baby). For six consecutive years TSMC has held a series of physical and mental health activities. 896 employees have joined the weight-loss program, losing a total of 2,867 kilograms collectively. 431 attendees completed the sleep quality improvement program to improve quality of life. Supplier and Contractor Management ● Supplier Management As a means of enhancing its supply chain management, TSMC is committed to communicating with and encouraging its contractors and suppliers to improve their quality, cost effectiveness, delivery performance and sustainability on environmental protection, safety and health. Through regular communication with senior managers, site audits and experience sharing, TSMC collaborates with major suppliers and contractors to enhance partnership and ensure continual improvement for better performance and increased joint contributions to society. As noted above, contractors performing high-risk activities must lay out clearly defined safety precautions and preventative measures. In addition, contractors working on high-risk engineering projects must establish OHSAS 18001 systems and the workers must successfully complete work skill training. ● Supply Chain Sustainability TSMC works with suppliers in several fields of sustainable development, such as greening the supply chain, carbon management for climate change, mitigation of fire risk, ESH management and business continuity plans in the event of a natural disaster. Since becoming a full member of the Responsible Business Alliance (RBA) in 2015, TSMC has completed the adoption of the RBA Code of Conduct throughout the Company by performing self-assessments at its facilities worldwide and reviewing policies and procedures in the areas of labor, health and safety, environment, ethics, and management systems. To enhance supply chain sustainability and streamline risk management, TSMC is committed to collaborating with its suppliers to maintain full compliance with Taiwan’s environmental, safety, health and fire regulations, and to establish the necessary management capability as well as continuous enhancement. TSMC is subject to the U.S. Securities & Exchange Commission (SEC) disclosure rule on conflict minerals released under Rule 13p-1 of the U.S. Securities Exchange Act of 1934. As a recognized global leader in the high-tech supply chain, the Company acknowledges its corporate social responsibility to strive to procure conflict-free minerals in an effort to recognize humanitarian and ethical social principles that protect the dignity of all people. To this end, TSMC has implemented a series of compliance safeguards in accordance with leading industry practices such as adopting the due diligence framework in the OECD’s Model Supply Chain Policy for a Responsible Global Supply Chain of Minerals from Conflict-Affected and High Risk Areas issued in 2011. TSMC is one of the strongest supporters of the Responsible Business Alliance and the Global e-Sustainability Initiative (GeSI), and this will help the Company’s suppliers source conflict-free minerals through their jointly developed Responsible Minerals Initiative (RMI). Since 2011, TSMC has asked its suppliers to disclose and make timely updates to information on smelters and mines. The Company encourages suppliers to source minerals from facilities or smelters that have received a “conflict-free” designation by a recognized industry group (such as the RBA) and also requires those who have not received such designation to become compliant with Responsible Minerals Initiative or an equivalent third-party audit program. TSMC requires the use of tantalum, tin, tungsten and gold in its products that are conflict-free. TSMC will continue to issue the supplier survey annually and require suppliers to improve and expand their disclosure to fulfill regulatory and customer requirements. For further information, please see the Company’s Form SD filed with the U.S. SEC. (http://www.tsmc.com/english/investorRelations/ sec_filings.htm) 7.3 TSMC Education and Culture Foundation The TSMC Education and Culture Foundation, led by TSMC Vice Chairman F.C. Tseng, who serves as the foundation’s chairman, was established in 1998 to make CSR contributions. In 2017, to fulfill TSMC’s social responsibility, the TSMC Education and Culture Foundation contributed over NT$76.79 million to the three main engagements: caring about the educationally disadvantaged, supporting youth with multiple educational platforms, and promoting arts and culture. In 2017, the TSMC Education and Culture Foundation collaborated with the Teach for Taiwan Foundation (TFT) to support young teachers devoted to education in remote townships to narrow the urban-rural gap. The Ministry of Culture bestowed the Art & Business Award upon the TSMC Education and Culture Foundation for its contributions to two projects that have been active for more than ten years: the “TSMC Youth Literature Award” and the “TSMC Youth Calligraphy and Seal-Carving Competition”. 2017 also marked the TSMC Hsinchu Arts Festival’s 15th anniversary. To celebrate the special moment, the Festival invited Peony Pavilion – Young Lovers’ Edition by Pai Hsien-yung, to present the Chinese exquisite theatric beauty as a gift to the community. Collaboration with Educational Partners Narrowing Educational Gap between Cities and Rural Regions In July 2016, the National Development Council of Taiwan Government conducted a survey of educational conditions in remote townships. The survey showed that educational gaps between city and rural regions had widened owing to several trends including low birth rate, globalization, and informatization. The TSMC Education and Culture Foundation has been focusing on the issue. Cooperating with several social groups, non-governmental organizations, and educational institutions, the TSMC Education and Culture Foundation provided resources of the arts, sciences, reading and digital education for disadvantaged children. In 2017, the Foundation began to support TFT’s Teacher Training Program to fulfill the need for qualified teachers in rural regions. The TSMC Education and Culture Foundation believes in the power of reading. As the initial philanthropy partner of “Hope Reading” of the CommonWealth Foundation, the TSMC Education and Culture Foundation has been donating 100 good books to each of 200 high schools and primary schools in Taiwan’s remote townships every year since 2004. More than 260,000 children have been helped with more than 230,000 books donated. In response to the needs of the digital era, in 2016, the TSMC Education and Culture Foundation further sponsored “Hope Reading 2.0” with NT$6 million in three years to provide schools with tablets and e-learning systems to encourage students to read. With the building of the digital platform, 545 students read 10,000 books in one semester, demonstrating a significant improvement in reading habits. The TSMC Education and Culture Foundation also emphasizes aesthetics and science education. “TSMC Aesthetic Tour” and “TSMC Science Tour,” launched in 2003 and 2010, respectively, take children from remote townships throughout the country to visit the National Palace Museum, the Taipei Fine Arts Museum and the science museums in northern, central and southern Taiwan. In 2017, more than 3,600 students participated in these tours. To date, the Foundation has sponsored over NT$95 million to take more than 100,000 students from rural primary schools on tours to expand their aesthetic vision and inspire their scientific interests. 130 131 To extend care to the educationally disadvantaged, in addition to the cooperation with Junyi Academy and Boyo Social Welfare Foundation, which provide digital learning tools and tutors, in 2017 the TSMC Education and Culture Foundation began sponsoring the Teacher Recruitment and Training Program of TFT, which recruits passionate youths to undergo orientation and training to become qualified educators. Following the program, the young teachers will be deployed to rural schools to provide disadvantaged students with suitable and superior education. For economically disadvantaged students in top universities, the TSMC Education and Culture Foundation sponsors the “Rising Sun Plan” of National Tsing Hua University and the “Sunflower Plan” of National Central University. In 2017, the TSMC Education and Culture Foundation provided 29 students with NT$2.42 million in scholarships and launched textbook donations to lighten their economic burden and enable them to focus on their studies. Building Educational Platforms Encouraging the Youth to Reach Their Dreams The TSMC Education and Culture Foundation has been holding multiple activities both in science and humanity as well as Dream Builders platform to encourage young people to explore and extend their interests and visions. In 2017, the Ministry of Culture of the Taiwan Government bestowed the Art & Business Award in the category of Cultivation of Arts and Culture Talents upon the TSMC Education and Culture Foundation for long-term contributions to two projects: the “TSMC Youth Literature Award” and “TSMC Youth Calligraphy and Seal-Carving Competition”. To raise the humanity sprit of our young generation, these two projects not only provide senior high school students with the chance to access literature and calligraphy beyond school academics, but also encourage the literature and calligraphy lovers to showcase their talent. The TSMC Education and Culture Foundation has held the “TSMC Youth Literature Award” and “TSMC Youth Calligraphy and Seal-Carving Competition” since 2004 and 2008, respectively, to encourage young people to develop proficiency in literature and calligraphy. For the literature award, there were 616 works in total submitted in 2017. Furthermore, the Foundation ran a campaign to vote for the youth’s favorite writer to inspire the junior writers to look up to senior ones. This year is the tenth anniversary of the “TSMC Youth Calligraphy and Seal-Carving Competition”. The TSMC Education and Culture Foundation newly corporates seal calligraphy and tracking calligraphy into the contest. The contest and extensive workshops attracted more than 900 attendees in total. To encourage those in the younger generation to pursue their dreams, the TSMC Education and Culture Foundation held the second “TSMC Dream Builders of Youth Project”. More than 66 teams from Taoyuan, Hsinchu and Miaoli applied for the project and, after three-stage reviews by professional committees, 6 teams were awarded prizes totaling NT$3 million. Within a year, they will dedicate themselves to various programs, including self-exploration, culture preservation, humanity care and so on to demonstrate their creativity and potential. According to the Program for International Student Assessment, Taiwanese students excel in mathematics and sciences but are less proficient at logical thinking, argumentation and presentation. Therefore, the TSMC Education and Culture Foundation sponsors The Center for Advanced Science Education at National Taiwan University to hold the competition, “TSMC Cup – Competition of Scientific Short Talk”. The competitors must read a wide variety of scientific materials, write popular introductory articles, give scientific speeches and answer the questions from their opponents, in order to improve their science presentation skills. In 2017, the theme of the competition was mathematics, which attracted 212 teams composed of over 700 students from K9 to K12. Through the assigned novels, movies, and TV series, the students discovered and absorbed how mathematics is used in everyday life. The TSMC Education and Culture Foundation also continued to support three science talent camps: Wu Chien-Shiung Science Camp, Wu Ta-Yu Science Camp and Madame Curie Senior High School Chemistry Camps, to provide 479 senior high school students and teachers the opportunity to meet and learn from world-class scientists and Nobel Prize masters with the objective of inspiring the students and helping them realize their potential. Promoting the Arts and Culture Presenting the Chinese Exquisite Theatric Beauty The TSMC Education and Culture Foundation is devoted to promoting arts and culture. In addition to actively supporting prominent international and Taiwanese artistic performances, cultivating local talented groups and having continued supports to classic arts, the TSMC Education and Culture Foundation has continued to organize the “TSMC Hsin-Chu Arts Festival” at TSMC’s site communities, Hsinchu, Taichung and Tainan, to present a broad spectrum of performances to uplift the community’s spiritual life. News to organize monthly literary lectures, inviting authors to read their works in the Sun Yun-Suan Memorial Museum and to offer community residents a chance to experience the charm of literature up close and in person. 2017 is the TSMC Hsin-Chu Arts Festival’s 15th anniversary. To celebrate, the Foundation presented the classic Chinese Kun Opera, Peony Pavilion – Young Lovers’ Edition by Pai Hsien-yung at National Taichung Theatre. The production has been not presented for 13 years in Taiwan. It is meaningful for the Foundation to present the marvelous Kun Opera as the opening performance of the Festival. For classical music programs, the Festival invited three well-known masters – Kun Woo Paik, Kolja Blacher, and Rudolf Buchbinder to perform Ludwig von Beethoven’s classic pieces. In addition, the Festival also organized the carnival, “Green Park Nearby My Home,” to convey to the community the education of eco-environmental protection through thetheatric play and workshops. The Foundation also invited renowned writers to share their understanding of their favorite Nobel Literature Award writers and their works. The 2017 TSMC Hsin-Chu Arts Festival arranged 36 fine arts activities, attracting nearly 20,000 attendees. The TSMC Education and Culture Foundation also supports various Taiwanese art groups. In 2017, the TSMC Education and Culture Foundation again sponsored National Symphony Orchestra to produce Giacomo Puccini’s Il trittico, Il tabarro, Suor Angelica, and Gianni Schicchi, premiered in Taiwan. The opera was directed by James Robinson, the Artistic Director of Opera Theatre of St. Louis. The stage, props, and costumes were made to international standards. The production attracted more than 3,700 fans and gained overwhelmingly positive responses. The TSMC Education and Culture Foundation has a long-term commitment to relive historic buildings and to promote Chinese Traditional Classics. Since 2008, the TSMC Education and Culture Foundation has invited Professor Yih-yun Hsin to teach traditional Chinese philosophy and wisdom through broadcast programs on the IC Radio Broadcasting Station. In 2017, Professor Hsin finished the Analects of Confucius and the lectures were made into a collection of audio books, which are extremely popular and followed by Chinese audiences all over the world. The TSMC Education and Culture Foundation also collaborates with Literary Supplement of United Daily 7.4 TSMC Charity Foundation In order to reinforce TSMC’s corporate social responsibilities and set a comprehensive mechanism for management, TSMC established the TSMC Charity Foundation in June 2017. Sophie Chang assumed the chairperson’s role with the intention of leading the foundation to create a “brilliant influence for spreading love”, continuously listening to the needs of society and inspire the efforts needed to make great progress in Taiwan. To leverage internal and external resources to optimize the influence of power, TSMC Charity Foundation, when first started, aligned with TSMC’s corporate social responsibilities policy and with the United Nations’ Sustainable Development Goals (SDGs) and defined four key themes for the foundation: taking care of elders, promoting filial piety, caring for the disadvantaged and protecting the environment. By providing services in these four areas, TSMC’s Charity Foundation can help to build a better society in Taiwan, and also make the world a better place to live. ● Take care of elders: Through Networking of Love, the resources of the hospitals in Taiwan have been integrated to provide prevention and treatment and promote mental health and wellbeing for the elderly who live alone. Currently partners in Networking of Love include: Taipei Veterans General Hospital, Old Five Old Foundation, Miaoli General Hospital, Feng Yuan Hospital, China Medical University Hospital, Lin Welfare and Charity Foundation, Tainan Puli Association, Sin-Lau Medical Foundation, Jianan Psychiatric Center, Hengchun Tourism Hospital, Mennonite Christian Hospital and its Charity Foundation. ● Promote filial piety: Promoting and reviving the younger generation’s appreciation of filial piety and promoting the value of filial piety in Eastern culture can help solve many social issues in an aged society, enhance the capability of sustainable develop of the society. In 2017, TSMC Charity Foundation collaborated with K-12 Education Administration, Ministry of Education and to edit and publish teaching materials on filial piety. 132 133 Non- implementation and Its Reason(s) None Assessment Item Implementation Status Yes No Summary 3. Promotion of Social Welfare V (1) Does the Company set policies and procedures in compliance with regulations and internationally recognized human rights principles? (1) Please refer to “5.5 Human Capital” on page 85-89 of this Annual Report. (2) Has the Company established appropriately managed employee appeal (2) Please refer to “5.5 Human Capital” on page 85-89 of this Annual Report. procedures? (3) Does the Company provide employees with a safe and healthy working (3) Please refer to “7.2.3 Safety and Health” on page 128-131 of this Annual environment, with regular safety and health training? Report. (4) Has the Company established a mechanism for regular communication with employees and use reasonable measures to notify employees of operational changes which may cause significant impact to employees? (4) Please refer to “5.5 Human Capital” on page 85-89 of this Annual Report. (5) Has the Company established effective career development training (5) Please refer to “5.5 Human Capital” on page 85-89 of this Annual Report. plans? (6) Has the Company set polices and consumer appeal procedures in its R&D, (6) Not applicable as TSMC is not an end product manufacturer. purchasing, production, operations, and service processes? (7) Does the Company follow regulations and international standards in the (7) Not applicable as TSMC is not an end product manufacturer. marketing and labelling of its products and services? (8) Does the company evaluate environmental and social track records before (8) Please refer to “Supplier and Contractor Management” on page 130-131 of engaging with potential suppliers? this Annual Report. (9) Does the Company’s contracts with major suppliers include termination clauses if they violate CSR policy and cause significant environmental and social impact? (9) Please refer to “Risks Associated with Purchase Concentration” in 6.3.3 Operational Risks of this Annual Report. 4. Enhanced Information Disclosure V Does the Company disclose relevant and reliable CSR information on its website and the Taiwan Stock Exchange website? TSMC has published a “Corporate Social Responsibility Report” since 2008, and discloses this on the Company’s website (http://www.tsmc.com/english/ csr/index.htm). None 5. If the company has established its corporate social responsibility code of practice according to “Listed Companies Corporate Social Responsibility Code of Practice,” please describe the operational status and differences. TSMC follows the Corporate Social Responsibility Policy set by the Chairman, Dr. Morris Chang. For our corporate social responsibility operational status, please refer to “7. Corporate Social Responsibility” on page 118-135 of this annual report and our corporate social responsibility related information in our website: http://www.tsmc.com/english/csr/index.htm 6. Other important information to facilitate better understanding of the company’s implementation of corporate social responsibility: Please refer to TSMC’s website for its corporate social responsibility implementation status: http://www.tsmc.com/english/csr/index.htm 7. Other information regarding “Corporate Responsibility Report ” which is verified by certifying bodies: TSMC’s Corporate Social Responsibility Report is in accordance with the GRI Standards and verified by certifying bodies. ● Care for the disadvantaged: Providing goods and medical resources to disadvantaged groups can ensure they can have safe, effective, quality and affordable essential medicines and vaccines. Ensuring disadvantaged groups have inclusive and equitable quality education will also go a long way towards achieving the United Nations’ goal to “End poverty in all its forms”. TSMC’s volunteers in this effort now number more than 8,000. ● Protect the environment: Promoting environmental education and knowledge will increase people’s awareness of the importance of prevention and adaptation regarding climate change. This includes TSMC’s ecology volunteers, who provide ecology tours in Hsinchu Fab 12B, Taichung Fab 15, Tainan Jacana Ecology Education Park, and TSMC’s professional energy-saving volunteers, who are organized by employees of the Company and assist schools at all levels on energy-saving assessment and improvement. The service locations cover: Taipei, Hsinchu, Taichung, Tainan and Kaohsiung such areas, providing power consumption safety and professional energy saving suggestions. 7.5 TSMC i-Charity “TSMC i-Charity” is an interactive online platform launched in 2014 for employees to proactively take part in philanthropic activities and give back to society. The intranet opens a channel for TSMC employees to propose caring projects, share results, suggest new ideas and participate in philanthropic events directly and in a timely manner. In 2017, 3,825 attendees participated in the following projects, as over NT$8 million in contributions were received: ● Library Repairing and Reconstruction for Nanhua Elementary School ● School Repairing and Reconstruction for Tainan Jin-Hu Elementary School ● School Repairing, Reconstruction and Expansion for Chiayi Shuishang After-class School From 2014 to 2017, TSMC i-Charity platform has received over NT$52 million in contributions. With this interactive platform, TSMC hopes to maintain its commitment to society and encourage employees to join in efforts to care for and give back to society in all ways. 7.6 Social Responsibility Implementation Status as Required by the Taiwan Financial Supervisory Commission Assessment Item Implementation Status Yes No Summary V V 1. Implementation of Corporate Governance (1) Does the Company have a corporate social responsibility policy and evaluate its implementation? (2) Does the Company hold regular CSR training? (3) Does the Company have a dedicated (or ad-hoc) CSR organization with Board of Directors authorization for senior management, which reports to the Board of Directors? (4) Does the Company set a reasonable compensation policy, integrate employee appraisal with CSR policy, and set clear and effective incentive and disciplinary policies? 2. Environmentally Sustainable Development (1) Is the Company committed to improving resource efficiency and to the use of renewable materials with low environmental impact? (2) Has the Company set an Environmental management system designed to industry characteristics? (3) Does the Company track the impact of climate change on operations, carry out greenhouse gas inventories, and set energy conservation and greenhouse gas reduction strategy Non- implementation and Its Reason(s) None (1) Please refer to “7. Corporate Social Responsibility” on page 118-135 of this Annual Report. (2) Please refer to “3.5 Code of Ethics and Business Conduct” on page 46-50 of this Annual Report (3) Please refer to “7. Corporate Social Responsibility” on page 118-135 of this Annual Report. (4) Social responsibility is regarded as an integral part of corporate governance by TSMC. TSMC’s fair compensation policy is set with consideration of the goals of the Company’s corporate governance and operation; corporate social responsibility is included as part of its indices. For further details, please refer to “5.5 Human Capital” on page 85-89 of this Annual Report. Please refer to “7.2.1 Environmental Protection” on page 123-126 of this Annual Report. None (Continued) 134 135 136 136 137 137 8. Subsidiary Information and Other Special Notes 8.1 Subsidiaries 8.1.1 TSMC Subsidiaries Chart TSMC Development, Inc. Shareholding: 100% WaferTech, LLC Shareholding: 100% TSMC Technology, Inc. Shareholding: 100% TSMC Design Technology Canada Inc. Shareholding: 100% InveStar Semiconductor Development Fund, Inc. (Note 1) Shareholding: 97.09% InveStar Semiconductor Development Fund, Inc. (II) LDC. (Note 1) Shareholding: 97.09% TSMC North America Shareholding: 100% TSMC Europe B.V. Shareholding: 100% TSMC Japan Limited Shareholding: 100% TSMC Korea Limited Shareholding: 100% TSMC Partners, Ltd. Shareholding: 100% TSMC Global Ltd. Shareholding: 100% TSMC China Company Limited Shareholding: 100% TSMC Nanjing Company Limited Shareholding: 100% VisEra Technologies Company Ltd. Shareholding: 86.94% VentureTech Alliance Fund II, L.P. Shareholding: 98% Taiwan Semiconductor Manufacturing Company Limited VentureTech Alliance Fund III, L.P. Shareholding: 98% Growth Fund Limited Shareholding: 100% TSMC Solar Europe GmbH (Note 2) Shareholding: 100% Note 1: InveStar Semiconductor Development Fund, Inc. and InveStar Semiconductor Development Fund, Inc. (II) LDC. are under liquidation procedures. Note 2: TSMC Solar Europe GmbH is under liquidation procedures. 8.1.2 Business Scope of TSMC and Its Subsidiaries TSMC and its subsidiaries strive to provide the best foundry services. Subsidiaries in North America, Europe, Japan, China and South Korea are dedicated to instantly serving TSMC customers worldwide. WaferTech in the United States and TSMC China provide additional 8-inch wafer capacity. TSMC Nanjing will begin to provide additional 12-inch wafer capacity in 2018. Other subsidiaries support the Company’s core foundry business with related services such as design service and investment in start-up companies involved in design, manufacturing, and other related businesses in the semiconductor industry. As of 12/31/2017 Company Date of Incorporation Place of Registration Capital Stock Business Activities 8.1.3 TSMC Subsidiaries In thousands of NT(USD, EUR, JPY, KRW, RMB, CAD)$ As of 12/31/2017 TSMC North America Jan. 18, 1988 San Jose, California, U.S. TSMC Europe B.V. TSMC Japan Limited TSMC Korea Limited Mar. 04, 1994 Amsterdam, The Netherlands Sep. 10, 1997 Yokohama, Japan May 2, 2006 Seoul, Korea TSMC China Company Limited Aug. 04, 2003 Shanghai, China US$ EUR JPY KRW RMB 11,000 Selling and marketing of integrated circuits and semiconductor devices 100 Customer service and supporting activities 300,000 Customer service and supporting activities 400,000 Customer service and supporting activities 4,502,080 Manufacturing, selling, testing, and computer-aided design of integrated circuits and other semiconductor devices TSMC Nanjing Company Limited May 16, 2016 Nanjing, China RMB 6,133,276 Manufacturing, selling, testing, and computer-aided design of integrated circuits and other semiconductor devices TSMC Technology, Inc. Feb. 20, 1996 Delaware, U.S. InveStar Semiconductor Development Fund, Inc. (Note 1) InveStar Semiconductor Development Fund, Inc. (II) LDC. (Note 1) Sep. 10, 1996 Cayman Islands Aug. 25, 2000 Cayman Islands TSMC Development, Inc. Feb. 16, 1996 Delaware, U.S. WaferTech, LLC Jun. 03, 1996 Delaware, U.S. TSMC Partners, Ltd. Mar. 26, 1998 British Virgin Islands TSMC Design Technology Canada Inc. May 28, 2007 Ontario, Canada TSMC Global Ltd. Jul. 13, 2006 British Virgin Islands VentureTech Alliance Fund II, L.P. Feb. 27, 2004 Cayman Islands VentureTech Alliance Fund III, L.P. Mar. 25, 2006 Cayman Islands Growth Fund Limited May 30, 2007 Cayman Islands TSMC Solar Europe GmbH (Note 2) Dec. 17, 2010 Hamburg, Germany US$ US$ US$ US$ US$ US$ CAD US$ US$ US$ US$ EUR 0.001 Engineering support activities 489 Investing in new start-up technology companies 0 Investing in new start-up technology companies 0.001 Investing in companies involved in the manufacturing related business in the semiconductor industry 0 Manufacturing, selling, and testing of integrated circuits and other semiconductor devices 988,268 Investing in companies involved in the design, manufacture, and other related business in the semiconductor industry and other investment activities 2,434 Engineering support activities 9,284,000 Investment activities 8,450 Investing in new start-up technology companies 96,522 Investing in new start-up technology companies 2,154 Investing in new start-up technology companies 400 Selling of solar modules and related products and providing customer service VisEra Technologies Company Ltd. Dec.1, 2003 Hsinchu, Taiwan NT$ 2,911,531 Engaged in manufacturing electronic spare parts and in researching, developing, designing, manufacturing, selling, packaging and testing of color filter Note 1: InveStar Semiconductor Development Fund, Inc. and InveStar Semiconductor Development Fund, Inc. (II) LDC. have started the liquidation procedures. Note 2: The dissolution procedures of TSMC Solar Europe GmbH are expected to be completed by the end of June 2018. 138 139 8.1.4 Shareholders in Common of TSMC and Its Subsidiaries with Deemed Control and Subordination: None. 8.1.5 Rosters of Directors, Supervisors, and Presidents of TSMC’s Subsidiaries Company Title Name Shareholding Shares (Investment Amount) % (Investment Holding %) Unit: NT$(USD), except shareholding As of 12/31/2017 WaferTech, LLC Company Title Name Shareholding Shares (Investment Amount) % (Investment Holding %) TSMC North America TSMC Europe B.V. TSMC Japan Limited TSMC Korea Limited TSMC China Company Limited TSMC Nanjing Company Limited TSMC Technology, Inc. Director Director President Director Director President Director Director Supervisor President Director Director Director Chairman Director Director Supervisor President Chairman Director Director Supervisor Supervisor President Chairman Director President Sylvia Fang Rick Cassidy David Keller Wendell Huang Maria Marced Maria Marced Chih-Chun Tsai Makoto Onodera Lora Ho Makoto Onodera C.C.Pan Chih-Chun Tsai Wendell Huang F.C. Tseng M.C. Tzeng L.C. Tu Lora Ho L.C. Tu C.C. Wei J.K.Wang Cliff Hou Lora Ho Sylvia Fang Roger Luo Lora Ho Cliff Hou Cliff Hou InveStar Semiconductor Development Fund, Inc. (Note 1) Director Wendell Huang InveStar Semiconductor Development Fund, Inc. (II) LDC (Note 1) Director Wendell Huang TSMC Development, Inc. Chairman Director President Lora Ho Sylvia Fang Lora Ho - - - TSMC holds 11,000,000 shares - - - TSMC holds 200 shares - - - - TSMC holds 6,000 shares - - - TSMC holds 80,000 shares - - - - - (TSMC’s investment US$596,000,000) - - - - - - (TSMC’s investment US$920,000,000) - - - TSMC Partners, Ltd. holds 10 shares - TSMC Partners, Ltd. holds 582,523 shares - TSMC Partners, Ltd. holds 9,298,625 shares - - - TSMC Partners, Ltd. holds 10 shares - - - 100% - - - 100% - - - - 100% - - - 100% - - - - - (100%) - - - - - - (100%) - - - 100% - 97.09% - 97.09% - - - 100% (Continued) Director Director President Director Director President Director Director Director President Director Director None None None M.C. Tzeng (Note 3) Steve Tso (Note 3) Tsung-Chia Kuo Lora Ho Sylvia Fang Lora Ho Cliff Hou Cormac Michael O’Connell Sylvia Fang Cliff Hou Lora Ho Sylvia Fang None None None TSMC Partners, Ltd. TSMC Design Technology Canada Inc. TSMC Global Ltd. VentureTech Alliance Fund II, L.P. VentureTech Alliance Fund III, L.P. Growth Fund Limited TSMC Solar Europe GmbH (Note 2) Liquidator Liham Chu VisEra Technologies Company Ltd. Chairman Director Director Supervisor President Robert Kuan J.K. Lin George Liu Wendell Huang S.C. Hsin - - - TSMC Development, Inc. holds 293,636,833 shares - - - TSMC holds 988,268,244 shares - - - - TSMC Partners, Ltd. holds 2,300,000 shares - - TSMC holds 9,284 shares (TSMC’s investment US$8,151,905) (TSMC’s investment US$94,591,952) (VentureTech Alliance Fund III, L.P.’s investment US$2,153,768) - TSMC holds 800 shares 54,600 shares - - - - TSMC holds 253,120,000 shares - - - 100% - - - 100% - - - - 100% - - 100% (98.00%) (98.00%) (100%) - 100% 0.02% - - - - 86.94% Note 1: InveStar Semiconductor Development Fund, Inc. and InveStar Semiconductor Development Fund, Inc. (II) LDC. have started the liquidation procedures. Note 2: The dissolution procedures of TSMC Solar Europe GmbH are expected to be completed by the end of June 2018. Note 3: Vice President J.K. Lin and Senior Director Wendell Huang replaced Senior Vice President and Chief Information Officer Dr. Steve Tso and Vice President M.C. Tzeng as TSMC’s representative directors in WaferTech effective on March 8, 2 018. 140 141 8.1.6 Operational Highlights of TSMC Subsidiaries Unit: NT$ thousands, except EPS (NT$) TSMC Development, Inc. 0.03 26,136,658 Company TSMC North America TSMC Europe B.V. TSMC Japan Limited TSMC Korea Limited TSMC Partners, Ltd. TSMC Global Ltd. WaferTech, LLC As of 12/31/2017 Basic Earning (Loss) Per Share Capital Stock Assets Liabilities Net Worth Net Revenues Income (Loss) from Operation Net Income (Loss) 326,249 101,252,896 97,251,893 4,001,003 656,786,045 206,713 5,859 0.53 3,545 78,870 11,160 544,923 179,703 41,856 29,311,048 49,863,409 137,599 50,257 2,645 0 0 407,325 129,446 39,211 494,366 209,193 24,267 53,145 40,557 202,784.41 8,819 2,230 3,600 1,970 600.07 24.62 26,136,658 1,557,029 1,556,722 1,448,900 144,889,982.80 49,863,409 2,231,879 2,225,601 2,225,601 2.25 275,354,156 345,671,142 36,459,265 309,211,877 6,390,773 5,028,339 5,026,024 652,229.12 0 5,756,837 687,279 5,069,559 8,619,322 2,220,672 1,248,658 TSMC China Company Limited 20,504,723 56,428,282 5,266,467 51,161,815 21,728,470 8,900,991 8,938,933 TSMC Nanjing Company Limited 27,934,006 55,413,191 28,344,818 27,068,373 0 (871,695) (867,563) VisEra Technologies Company Ltd. 2,911,531 5,911,829 605,263 5,306,566 2,519,211 210,891 207,557 TSMC Technology, Inc. 0.03 1,057,567 538,951 518,616 1,908,259 57,585 14,502 219,788 37,459 182,329 253,031 513 52 90,888 23,003 44 18,990 1,899,043.20 15,597 44 6.78 0.07 4.25 NA NA 0.71 TSMC Design Technology Canada Inc. InveStar Semiconductor Development Fund, Inc. InveStar Semiconductor Development Fund, Inc. (II) LDC. VentureTech Alliance Fund II, L.P. VentureTech Alliance Fund III, L.P. TSMC Solar Europe GmbH Growth Fund Limited 0 1,052 250,622 2,862,758 14,180 63,879 320,701 132,009 14,380 46,334 6 187 0 0 507 864 320,701 132,009 34,597 (20,217) 0 46,334 446,855 378,299 378,299 39.50 151,461 133,784 133,597 2,218 0 0 (25,234) (12,629) (1,385) NA NA (25,234) (12,706) (15,882.38) (1,385) NA 8.2 Status of TSMC Common Shares and ADRs Acquired, Disposed of, and Held by Subsidiaries: None. 8.3 Special Notes 8.3.1 Private Placement Securities in 2017 and as of the Date of this Annual Report: None. 8.3.2 Regulatory Authorities’ Legal Penalties to the Company or Its Employees, and the Company’s Resulting Punishment on Its Employees for Violations of Internal Control System Provisions, Principal Deficiencies, and the State of Any Efforts to Make Improvements in 2017 and as of the Date of this Annual Report In 2017 and as of the date of this Annual Report, the Company complied with the Taiwan Company Law and Securities Trading Act relevant laws and regulations. The competent authority issued a minor fine of NT$20,000 for the deficiency of TSMC’s overtime calculation rules. After communicating with the authority, TSMC has completed the remedial measures. 8.3.3 Any Events in 2017 and as of the Date of this Annual Report that Had Significant Impacts on Shareholders’ Right or Security Prices as Stated in Item 3 Paragraph 2 of Article 36 of Securities and Exchange Law of Taiwan: None. 8.3.4 Other Necessary Supplement: None. 142 143 Contact Information Corporate Headquarters & Fab 12A 8, Li-Hsin Rd. 6, Hsinchu Science Park, Hsinchu 30078, Taiwan, R.O.C. Tel: +886-3-5636688 Fax: +886-3-5637000 R&D Center & Fab 12B 168, Park Ave. II, Hsinchu Science Park, Hsinchu 30075, Taiwan, R.O.C. Tel: +886-3-5636688 Fax: +886-3-6687827 Fab 2, Fab 5 121, Park Ave. 3, Hsinchu Science Park, Hsinchu 30077, Taiwan, R.O.C. Tel: +886-3-5636688 Fax: +886-3-5781546 Fab 3 9, Creation Rd. 1, Hsinchu Science Park, Hsinchu 30077, Taiwan, R.O.C. Tel: +886-3-5636688 Fax: +886-3-5781548 Fab 6 1, Nan-Ke North Rd., Tainan Science Park, Tainan 74144, Taiwan R.O.C. Tel: +886-6-5056688 Fax: +886-6-5052057 Fab 8 25, Li-Hsin Rd., Hsinchu Science Park, Hsinchu 30078, Taiwan, R.O.C. Tel: +886-3-5636688 Fax: +886-3-5662051 Fab 14A 1-1, Nan-Ke North Rd., Tainan Science Park, Tainan 74144, Taiwan R.O.C. Tel: +886-6-5056688 Fax: +886-6-5051262 Fab 14B 17, Nan-Ke 9th Rd., Tainan Science Park, Tainan 74144, Taiwan, R.O.C. Tel: +886-6-5056688 Fax: +886-6-5055217 Fab 15A 1, Keya Rd. 6, Central Taiwan Science Park, Taichung 42882, Taiwan R.O.C. Tel: +886-4-27026688 Fax: + 886-4-25607548 Fab 15B 1, Xinke Rd., Central Taiwan Science Park, Taichung 40763, Taiwan R.O.C. Tel: +886-4-27026688 Fax: +886-4-24630372 TSMC North America 2851 Junction Avenue, San Jose, CA 95134, U.S.A. Tel: +1-408-3828000 Fax: +1-408-3828008 TSMC Europe B.V. World Trade Center, Zuidplein 60, 1077 XV Amsterdam The Netherlands Tel: +31-20-3059900 Fax: +31-20-3059911 TSMC Japan Limited 21F, Queen’s Tower C, 2-3-5, Minatomirai, Nishi-ku, Yokohama Kanagawa, 220-6221, Japan Tel: +81-45-6820470 Fax: +81-45-6820673 TSMC China Company Limited 4000, Wen Xiang Road, Songjiang, Shanghai, China Postcode: 201616 Tel: +86-21-57768000 Fax: +86-21-57762525 TSMC Nanjing Company Limited 16, Zifeng Road, Pukou Economic Development Zone, Nanjing Jiangsu Province, China Postcode: 211806 Tel: +86-25-57668000 Fax: +86-25-57712395 TSMC Korea Limited 15F, AnnJay Tower, 208, Teheran-ro, Gangnam-gu, Seoul 06220, Korea Tel: +82-2-20511688 Fax: + 82-2-20511669 TSMC Design Technology Canada Inc. 535 Legget Dr., Suite 600, Kanata, ON K2K 3B8, Canada Tel: +613-576-1990 Fax: +613-576-1999 TSMC Spokesperson Name: Lora Ho Title: Senior Vice President & CFO Tel: +886-3-5054602 Fax: +886-3-5637000 Email: cyhsu@tsmc.com TSMC Deputy Spokesperson/Corporate Communications Name: Elizabeth Sun Title: Senior Director, TSMC Corporate Communication Division Tel: +886-3-5682085 Fax: +886-3-5637000 Email: elizabeth_sun@tsmc.com Auditors Company: Deloitte & Touche Auditors: Yih-Hsin Kao, Yu-Feng Huang Address: 12F, 156, Sec. 3, Min-Sheng E. Rd., Taipei 10596, Taiwan R.O.C. Tel: +886-2-25459988 Fax: +886-2-40516888 Website: http://www.deloitte.com.tw Common Share Transfer Agent and Registrar Company: The Transfer Agency Department of CTBC Bank Address: 5F, 83, Sec. 1, Chung-Ching S. Rd., Taipei 10008, Taiwan R.O.C. Tel: +886-2-66365566 Fax: +886-2-23116723 Website: http://www.ctbcbank.com ADR Depositary Bank Company: Citibank, N.A. Depositary Receipts Services Address: 388 Greenwich Street, New York, NY 10013, U.S.A. Website: http://www.citi.com/dr Tel: +1-877-2484237 (toll free) Tel: +1-781-5754555 (out of US) Fax: + 1-201-3243284 E-mail: citibank@shareholders-online.com TSMC’s depositary receipts of the common shares are listed on New York Stock Exchange (NYSE) under the symbol TSM. The information relating to TSM is available at http://www.nyse.com and http://mops. twse.com.tw “TSMC”, “tsmc”, “Open Innovation Platform”, “Open Innovation”, “GIGAFAB” and “CoWoS” are some of our registered trademarks used by us in various jurisdictions, including Taiwan. All rights reserved. Copyright© 2017 by Taiwan Semiconductor Manufacturing Company, Ltd. All rights reserved. i T a w a n S e m i c o n d u c t o r M a n u f a c t u r i n g C o m p a n y , L t d . A n n u a l R e p o r t 2 0 1 7 ( I I ) F i n a n c i a l S t a t e m e n t s Contents Consolidated Financial Statements for the Years Ended December 31, 2017 and 2016 and Independent Auditors’ Report Parent Company Only Financial Statements for the Years Ended December 31, 2017 and 2016 and Independent Auditors’ Report 1 97 Taiwan Semiconductor Manufacturing Company Limited and Subsidiaries Consolidated Financial Statements for the Years Ended December 31, 2017 and 2016 and Independent Auditors’ Report - 1 - - 2 - REPRESENTATION LETTER The entities that are required to be included in the combined financial statements of Taiwan Semiconductor Manufacturing Company Limited as of and for the year ended December 31, 2017, under the Criteria Governing the Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises are the same as those included in the consolidated financial statements prepared in conformity with the International Financial Reporting Standard 10, “Consolidated Financial Statements.” In addition, the information required to be disclosed in the combined financial statements is included in the consolidated financial statements. Consequently, Taiwan Semiconductor Manufacturing Company Limited and Subsidiaries do not prepare a separate set of combined financial statements. Very truly yours, TAIWAN SEMICONDUCTOR MANUFACTURING COMPANY LIMITED By MORRIS CHANG Chairman February 13, 2018 - 3 - - 3 - - 4 - - 5 - - 6 - - 7 - Taiwan Semiconductor Manufacturing Company Limited and Subsidiaries CONSOLIDATED BALANCE SHEETS (In Thousands of New Taiwan Dollars) ASSETS CURRENT ASSETS Cash and cash equivalents (Note 6) Financial assets at fair value through profit or loss (Note 7) Available-for-sale financial assets (Notes 8 and 14) Held-to-maturity financial assets (Note 9) Hedging derivative financial assets (Note 10) Notes and accounts receivable, net (Note 11) Receivables from related parties (Note 34) Other receivables from related parties (Note 34) Inventories (Notes 5, 12 and 38) Other financial assets (Notes 35 and 38) Other current assets (Note 17) Total current assets NONCURRENT ASSETS Held-to-maturity financial assets (Note 9) Financial assets carried at cost (Note 13) Investments accounted for using equity method (Notes 5 and 14) Property, plant and equipment (Notes 5 and 15) Intangible assets (Notes 5 and 16) Deferred income tax assets (Notes 5 and 29) Refundable deposits Other noncurrent assets (Note 17) Total noncurrent assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term loans (Note 18) Financial liabilities at fair value through profit or loss (Note 7) Hedging derivative financial liabilities (Note 10) Accounts payable Payables to related parties (Note 34) Salary and bonus payable Accrued profit sharing bonus to employees and compensation to directors and supervisors (Notes 23 and 31) Payables to contractors and equipment suppliers Income tax payable (Notes 5 and 29) Provisions (Notes 5 and 19) Long-term liabilities - current portion (Note 20) Accrued expenses and other current liabilities (Note 22) Total current liabilities NONCURRENT LIABILITIES Bonds payable (Note 20) Long-term bank loans Deferred income tax liabilities (Notes 5 and 29) Net defined benefit liability (Notes 5 and 21) Guarantee deposits (Note 22) Others Total noncurrent liabilities Total liabilities EQUITY ATTRIBUTABLE TO SHAREHOLDERS OF THE PARENT Capital stock (Note 23) Capital surplus (Note 23) Retained earnings (Note 23) Appropriated as legal capital reserve Unappropriated earnings Others (Note 23) December 31, 2017 Amount % December 31, 2016 Amount % $ 553,391,696 569,751 93,374,153 1,988,385 34,394 121,133,248 1,184,124 171,058 73,880,747 7,253,114 4,222,440 28 - 5 - - 6 - - 4 - - $ 541,253,833 6,451,112 67,788,767 16,610,116 5,550 128,335,271 969,559 146,788 48,682,233 4,100,475 3,385,422 29 - 4 1 - 7 - - 3 - - 857,203,110 43 817,729,126 44 18,833,329 4,874,257 17,861,488 1,062,542,322 14,175,140 12,105,463 1,283,414 2,983,120 1 - 1 53 1 1 - - 22,307,561 4,102,467 19,743,888 997,777,687 14,614,846 8,271,421 407,874 1,500,432 1 - 1 53 1 - - - 1,134,658,533 57 1,068,726,176 56 $ 1,991,861,643 100 $ 1,886,455,302 100 $ 63,766,850 26,709 15,562 28,412,807 1,656,356 14,254,871 23,419,135 55,723,774 33,479,311 13,961,787 58,401,122 65,588,396 $ 3 - - 1 - 1 1 3 2 1 3 3 57,958,200 191,135 - 26,062,351 1,262,174 13,681,817 22,894,006 63,154,514 40,306,054 18,037,789 38,109,680 36,581,553 3 - - 2 - 1 1 3 2 1 2 2 358,706,680 18 318,239,273 17 91,800,000 - 302,205 8,850,704 7,586,790 1,855,621 110,395,320 5 - - 1 - - 6 153,093,557 21,780 141,183 8,551,408 14,670,433 1,686,542 178,164,903 8 - - - 1 - 9 469,102,000 24 496,404,176 26 259,303,805 56,309,536 13 3 259,303,805 56,272,304 14 3 241,722,663 991,639,347 1,233,362,010 12 49 61 (26,917,818) (1) 208,297,945 863,710,224 1,072,008,169 1,663,983 11 46 57 - Equity attributable to shareholders of the parent 1,522,057,533 76 1,389,248,261 74 NONCONTROLLING INTERESTS Total equity TOTAL 702,110 - 802,865 - 1,522,759,643 76 1,390,051,126 74 $ 1,991,861,643 100 $ 1,886,455,302 100 The accompanying notes are an integral part of the consolidated financial statements. - 8 - - 8 - Taiwan Semiconductor Manufacturing Company Limited and Subsidiaries CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) 2017 2016 Amount % Amount % NET REVENUE (Notes 5, 24, 34 and 40) $ 977,447,241 100 $ 947,938,344 100 COST OF REVENUE (Notes 5, 12, 31, 34 and 38) 482,616,286 49 473,077,173 50 GROSS PROFIT BEFORE UNREALIZED GROSS PROFIT ON SALES TO ASSOCIATES 494,830,955 51 474,861,171 50 UNREALIZED GROSS PROFIT ON SALES TO ASSOCIATES GROSS PROFIT OPERATING EXPENSES (Notes 5, 31 and 34) Research and development General and administrative Marketing (4,553) - (29,073) - 494,826,402 51 474,832,098 50 80,732,463 21,196,717 5,972,488 8 2 1 71,207,703 19,795,593 5,900,837 7 2 1 Total operating expenses 107,901,668 11 96,904,133 10 OTHER OPERATING INCOME AND EXPENSES, NET (Notes 16, 25 and 31) (1,365,511) (1) 29,813 - INCOME FROM OPERATIONS (Note 40) 385,559,223 39 377,957,778 40 NON-OPERATING INCOME AND EXPENSES Share of profits of associates (Note 14) Other income (Note 26) Foreign exchange gain (loss), net (Note 39) Finance costs (Note 27) Other gains and losses, net (Note 28) 2,985,941 9,610,294 (1,509,473) (3,330,313) 2,817,358 Total non-operating income and expenses 10,573,807 1 1 - - - 2 3,495,600 6,454,901 1,161,322 (3,306,153) 195,932 8,001,602 - 1 - - - 1 INCOME BEFORE INCOME TAX 396,133,030 41 385,959,380 41 INCOME TAX EXPENSE (Notes 5 and 29) 52,986,182 6 51,621,144 6 NET INCOME 343,146,848 35 334,338,236 35 (Continued) - 9 - - 9 - Taiwan Semiconductor Manufacturing Company Limited and Subsidiaries CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) OTHER COMPREHENSIVE INCOME (LOSS) (Notes 14, 21, 23 and 29) Items that will not be reclassified subsequently to profit or loss: Remeasurement of defined benefit obligation Share of other comprehensive loss of associates Income tax benefit related to items that will not be $ reclassified subsequently Items that may be reclassified subsequently to profit or loss: Exchange differences arising on translation of foreign operations Changes in fair value of available-for-sale financial assets Cash flow hedges Share of other comprehensive income (loss) of associates Income tax expense related to items that may be reclassified subsequently 2017 2016 Amount % Amount % (254,681) (20,853) 30,562 (244,972) - - - - $ (1,057,220) (19,961) 126,867 (950,314) - - - - (28,259,627) (3) (9,379,477) (1) (218,832) 4,683 (99,347) (3,536) - - - - (692,523) - 16,301 (61,176) - - - - (28,576,659) (3) (10,116,875) (1) Other comprehensive loss for the year, net of income tax (28,821,631) (3) (11,067,189) (1) TOTAL COMPREHENSIVE INCOME FOR THE YEAR $ 314,325,217 32 $ 323,271,047 34 NET INCOME ATTRIBUTABLE TO: Shareholders of the parent Noncontrolling interests TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO: Shareholders of the parent Noncontrolling interests $ 343,111,476 35,372 35 - $ 334,247,180 91,056 35 - $ 343,146,848 35 $ 334,338,236 35 $ 314,294,993 30,224 32 - $ 323,186,736 84,311 34 - $ 314,325,217 32 $ 323,271,047 34 (Continued) - 10 - - 10 - Taiwan Semiconductor Manufacturing Company Limited and Subsidiaries CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) 2017 Income Attributable to Shareholders of the Parent 2016 Income Attributable to Shareholders of the Parent EARNINGS PER SHARE (NT$, Note 30) Basic earnings per share Diluted earnings per share $ $ 13.23 13.23 $ $ 12.89 12.89 The accompanying notes are an integral part of the consolidated financial statements. (Concluded) - 11 - - 11 - l a t o T y t i u q E g n i l l o r t n o c n o N s t s e r e t n I l a t o T l a t o T n o i t a s n e p m o C e v r e s e R s e g d e H s t e s s A l a i c n a n i F d e n r a e n U d e s a B - k c o t S e e y o l p m E w o l F h s a C s r e h t O d e z i l a e r n U s s o L / n i a G m o r f - e l b a l i a v A e l a s - r o f n g i e r o F y c n e r r u C n o i t a l s n a r T e v r e s e R l a t o T s g n i n r a E e v r e s e R s u l p r u S l a t i p a C t n u o m A ) s d n a s u o h T n I ( s g n i n r a E d e n i a t e R d e t a i r p o r p p a n U l a t i p a C l a g e L k c o t S n o m m o C - k c o t S l a t i p a C s e r a h S t n e r a P e h t f o s r e d l o h e r a h S o t e l b a t u b i r t t A y t i u q E ) e r a h S r e P s d n e d i v i D t p e c x E , s r a l l o D n a w i a T w e N f o s d n a s u o h T n I ( Y T I U Q E N I S E G N A H C F O S T N E M E T A T S D E T A D I L O S N O C s e i r a i d i s b u S d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T $ ) 7 0 6 ( $ 1 7 7 , 4 3 7 $ 9 4 9 , 9 3 0 , 1 1 $ 6 8 5 , 3 9 2 , 4 9 8 $ 5 2 0 , 3 5 6 , 6 1 7 $ 1 6 5 , 0 4 6 , 7 7 1 $ 5 1 2 , 0 0 3 , 6 5 $ 5 0 8 , 3 0 3 , 9 5 2 $ 0 8 3 , 0 3 9 , 5 2 6 1 0 2 , 1 Y R A U N A J , E C N A L A B - ) 3 8 2 , 2 8 5 , 5 5 1 ( ) 3 8 2 , 2 8 5 , 5 5 1 ( - - - - ) 3 8 2 , 2 8 5 , 5 5 1 ( ) 3 8 2 , 2 8 5 , 5 5 1 ( 6 3 2 , 8 3 3 , 4 3 3 6 5 0 , 1 9 0 8 1 , 7 4 2 , 4 3 3 - - - - ) 9 8 1 , 7 6 0 , 1 1 ( ) 5 4 7 , 6 ( ) 4 4 4 , 0 6 0 , 1 1 ( ) 0 3 1 , 0 1 1 , 0 1 ( 7 4 0 , 1 7 2 , 3 2 3 1 1 3 , 4 8 6 3 7 , 6 8 1 , 3 2 3 ) 0 3 1 , 0 1 1 , 0 1 ( ) 9 6 1 , 6 5 ( - 0 3 2 , 1 2 - 9 ) 7 3 0 , 7 ( ) 4 5 9 , 1 ( ) 4 5 9 , 1 ( ) 4 2 2 , 5 3 2 ( ) 4 2 2 , 5 3 2 ( ) 9 6 1 , 6 5 ( 1 2 2 , 1 2 7 3 0 , 7 - - - - - - - 6 2 1 , 1 5 0 , 0 9 3 , 1 5 6 8 , 2 0 8 1 6 2 , 8 4 2 , 9 8 3 , 1 3 8 9 , 3 6 6 , 1 - ) 3 6 6 , 2 1 5 , 1 8 1 ( ) 3 6 6 , 2 1 5 , 1 8 1 ( - - - - ) 3 6 6 , 2 1 5 , 1 8 1 ( ) 3 6 6 , 2 1 5 , 1 8 1 ( 8 4 8 , 6 4 1 , 3 4 3 2 7 3 , 5 3 6 7 4 , 1 1 1 , 3 4 3 - - - - ) 1 3 6 , 1 2 8 , 8 2 ( ) 8 4 1 , 5 ( ) 3 8 4 , 6 1 8 , 8 2 ( ) 1 1 5 , 1 7 5 , 8 2 ( 7 1 2 , 5 2 3 , 4 1 3 4 2 2 , 0 3 3 9 9 , 4 9 2 , 4 1 3 ) 1 1 5 , 1 7 5 , 8 2 ( 9 7 4 , 4 3 6 , 2 2 2 , 1 $ 0 6 7 , 2 6 9 $ 9 1 7 , 1 7 6 , 1 2 2 , 1 $ 3 1 1 , 4 7 7 , 1 1 $ - - - - - - - - - - - - - - - - - - - 7 3 8 , 0 2 4 8 6 , 1 - ) 4 9 9 , 0 1 ( ) 4 9 9 , 7 ( ) 4 9 9 , 7 ( ) 5 7 6 , 3 1 1 ( ) 5 7 6 , 3 1 1 ( - - 4 9 9 , 0 1 3 5 1 , 9 1 - - - - - - - - ) 5 0 2 , 3 ( - ) 5 0 2 , 3 ( ) 0 9 2 , 0 1 ( ) 0 9 2 , 0 1 ( - - - - 2 1 7 2 1 7 - - - - - - - - - 1 2 1 , 4 1 2 1 , 4 - - - - - - - - - - - - - - - - - - - - - - - - - ) 0 3 1 , 2 3 7 ( ) 2 1 7 , 8 7 3 , 9 ( ) 4 1 3 , 0 5 9 ( ) 4 1 3 , 0 5 9 ( ) 0 3 1 , 2 3 7 ( ) 2 1 7 , 8 7 3 , 9 ( 6 6 8 , 6 9 2 , 3 3 3 6 6 8 , 6 9 2 , 3 3 3 - - - - - - - - 0 8 1 , 7 4 2 , 4 3 3 0 8 1 , 7 4 2 , 4 3 3 - ) 3 8 2 , 2 8 5 , 5 5 1 ( ) 3 8 2 , 2 8 5 , 5 5 1 ( ) 4 8 3 , 7 5 6 , 0 3 ( ) 3 8 2 , 2 8 5 , 5 5 1 ( ) 7 6 6 , 9 3 2 , 6 8 1 ( - 4 8 3 , 7 5 6 , 0 3 4 8 3 , 7 5 6 , 0 3 - - - - - - - - - - - - - - - - - - - - ) 5 1 7 , 6 1 2 ( ) 7 1 9 , 8 5 3 , 8 2 ( ) 2 7 9 , 4 4 2 ( ) 2 7 9 , 4 4 2 ( ) 5 1 7 , 6 1 2 ( ) 7 1 9 , 8 5 3 , 8 2 ( 4 0 5 , 6 6 8 , 2 4 3 4 0 5 , 6 6 8 , 2 4 3 - - - - - - - - 6 7 4 , 1 1 1 , 3 4 3 6 7 4 , 1 1 1 , 3 4 3 - ) 3 6 6 , 2 1 5 , 1 8 1 ( ) 3 6 6 , 2 1 5 , 1 8 1 ( ) 8 1 7 , 4 2 4 , 3 3 ( ) 3 6 6 , 2 1 5 , 1 8 1 ( ) 1 8 3 , 7 3 9 , 4 1 2 ( 8 1 7 , 4 2 4 , 3 3 - 8 1 7 , 4 2 4 , 3 3 - - - - - - - - - - - - - - - - - - - - - - ) 9 6 1 , 6 5 ( 1 2 2 , 1 2 7 3 0 , 7 - - - - - - - - - - - - - - - - - - - - - - - - e r a h s r e p 6 $ T N - s r e d l o h e r a h s o t s d n e d i v i d h s a C s g n i n r a e s ’ r a e y r o i r p f o s n o i t a i r p o r p p A e v r e s e r l a t i p a c l a g e L 6 1 0 2 n i e m o c n i t e N l a t o T f o t e n , 6 1 0 2 n i ) s s o l ( e m o c n i e v i s n e h e r p m o c r e h t O x a t e m o c n i 6 1 0 2 n i ) s s o l ( e m o c n i e v i s n e h e r p m o c l a t o T y t i u q e g n i s u r o f d e t n u o c c a s t n e m t s e v n i f o l a s o p s i D d o h t e m f o s e i t i u q e n i s e g n a h c f o e r a h s o t s t n e m t s u j d A s e t a i c o s s a s e i r a i d i s b u s f o s e i t i u q e n i s e g n a h c f o e r a h s m o r F s t s e r e t n i g n i l l o r t n o c n o n n i e s a e r c e D y r a i d i s b u s f o l a s o p s i d f o t c e f f E - - - - - - - - 5 8 0 , 7 4 9 9 , 0 1 3 5 1 , 9 1 - - - - - - - - - - - - - - - - - - - - - - e r a h s r e p 7 $ T N - s r e d l o h e r a h s o t s d n e d i v i d h s a C s g n i n r a e s ’ r a e y r o i r p f o s n o i t a i r p o r p p A e v r e s e r l a t i p a c l a g e L 7 1 0 2 n i e m o c n i t e N l a t o T f o t e n , 7 1 0 2 n i ) s s o l ( e m o c n i e v i s n e h e r p m o c r e h t O x a t e m o c n i f o s e i t i u q e n i s e g n a h c f o e r a h s o t s t n e m t s u j d A s e t a i c o s s a 7 1 0 2 n i ) s s o l ( e m o c n i e v i s n e h e r p m o c l a t o T s e i r a i d i s b u s f o s e i t i u q e n i s e g n a h c f o e r a h s m o r F s t s e r e t n i g n i l l o r t n o c n o n n i e s a e r c e D y r a i d i s b u s f o l a s o p s i d f o t c e f f E s r e d l o h e r a h s m o r f n o i t a n o D 5 0 1 1 4 6 , 2 7 3 2 , 1 6 6 , 1 9 6 1 , 8 0 0 , 2 7 0 , 1 4 2 2 , 0 1 7 , 3 6 8 5 4 9 , 7 9 2 , 8 0 2 4 0 3 , 2 7 2 , 6 5 5 0 8 , 3 0 3 , 9 5 2 0 8 3 , 0 3 9 , 5 2 6 1 0 2 , 1 3 R E B M E C E D , E C N A L A B 3 4 6 , 9 5 7 , 2 2 5 , 1 $ 0 1 1 , 2 0 7 $ 3 3 5 , 7 5 0 , 2 2 5 , 1 $ ) 8 1 8 , 7 1 9 , 6 2 ( $ ) 0 9 2 , 0 1 ( $ 6 2 2 , 4 $ ) 4 7 0 , 4 1 2 ( $ ) 0 8 6 , 7 9 6 , 6 2 ( $ 0 1 0 , 2 6 3 , 3 3 2 , 1 $ 7 4 3 , 9 3 6 , 1 9 9 $ 3 6 6 , 2 2 7 , 1 4 2 $ 6 3 5 , 9 0 3 , 6 5 $ 5 0 8 , 3 0 3 , 9 5 2 $ 0 8 3 , 0 3 9 , 5 2 7 1 0 2 , 1 3 R E B M E C E D , E C N A L A B . s t n e m e t a t s l a i c n a n i f d e t a d i l o s n o c e h t f o t r a p l a r g e t n i n a e r a s e t o n g n i y n a p m o c c a e h T - - 2 2 1 1 - - Taiwan Semiconductor Manufacturing Company Limited and Subsidiaries CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments for: Depreciation expense Amortization expense Finance costs Share of profits of associates Interest income Loss (gain) on disposal or retirement of property, plant and equipment, net Impairment loss on intangible assets Impairment loss on financial assets Loss (gain) on disposal of available-for-sale financial assets, net Gain on disposal of financial assets carried at cost, net Loss on disposal of investments accounted for using equity method, net Loss (gain) from disposal of subsidiaries Unrealized gross profit on sales to associates Gain on foreign exchange, net Dividend income Loss (gain) arising from fair value hedges, net Changes in operating assets and liabilities: Financial instruments at fair value through profit or loss Notes and accounts receivable, net Receivables from related parties Other receivables from related parties Inventories Other financial assets Other current assets Other noncurrent assets Accounts payable Payables to related parties Salary and bonus payable Accrued profit sharing bonus to employees and compensation to directors and supervisors Accrued expenses and other current liabilities Provisions Net defined benefit liability Cash generated from operations Income taxes paid 2017 2016 $ 396,133,030 $ 385,959,380 255,795,962 4,346,736 3,330,313 (2,985,941) (9,464,706) 1,097,908 13,520 29,603 (76,986) (12,809) - (17,343) 4,553 (9,118,580) (145,588) 30,293 5,645,093 1,061,805 (214,565) (13,873) (25,229,101) (502,306) 12,085 (1,276,130) 2,572,072 394,182 582,054 220,084,998 3,743,406 3,306,153 (3,495,600) (6,317,500) (46,548) - 122,240 4,014 (37,241) 259,960 36,105 29,073 (2,656,406) (137,401) (16,973) (6,326,561) (49,342,698) (463,837) (21,770) 18,370,037 (41,554) 94,512 (349,771) 7,295,491 139,818 1,979,775 525,129 30,435,424 (4,057,900) 44,615 648,938,549 (63,620,382) 1,935,113 3,693,638 7,931,877 46,163 585,777,893 (45,943,301) Net cash generated by operating activities 585,318,167 539,834,592 CASH FLOWS FROM INVESTING ACTIVITIES Acquisitions of: Available-for-sale financial assets Held-to-maturity financial assets Financial assets carried at cost Property, plant and equipment Intangible assets Land use right (100,510,905) (1,997,076) (1,313,124) (330,588,188) (4,480,588) (819,694) (83,275,573) (33,625,353) (533,745) (328,045,270) (4,243,087) (805,318) (Continued) - 13 - - 13 - Taiwan Semiconductor Manufacturing Company Limited and Subsidiaries CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) Proceeds from disposal or redemption of: Available-for-sale financial assets Held-to-maturity financial assets Financial assets carried at cost Property, plant and equipment Proceeds from return of capital of financial assets carried at cost Derecognition of hedging derivative financial instruments Interest received Proceeds from government grants - property, plant and equipment Proceeds from government grants - land use right and others Cash outflow from disposal of subsidiary Other dividends received Dividends received from investments accounted for using equity method Refundable deposits paid Refundable deposits refunded Decrease in receivables for temporary payments $ 2017 2016 $ 69,480,675 17,980,640 58,237 326,232 14,828 33,008 9,526,253 2,629,747 1,811 (4,080) 145,588 4,245,772 (1,326,983) 432,944 - 29,967,979 10,550,000 160,498 98,069 65,087 8,868 6,353,195 738,643 798,469 - 137,420 5,478,790 (144,982) 169,912 706,718 Net cash used in investing activities (336,164,903) (395,439,680) CASH FLOWS FROM FINANCING ACTIVITIES Increase in short-term loans Repayment of bonds Repayment of long-term bank loans Interest paid Guarantee deposits received Guarantee deposits refunded Cash dividends Donation from shareholders Decrease in noncontrolling interests 10,394,290 (38,100,000) (31,460) (3,482,703) 950,928 (3,823,183) (181,512,663) 20,837 (113,675) 18,968,936 (23,471,600) (8,540) (3,302,420) 6,354,677 (523,234) (155,582,283) - (235,733) Net cash used in financing activities (215,697,629) (157,800,197) EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS (21,317,772) (8,029,812) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 12,137,863 (21,435,097) CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 541,253,833 562,688,930 CASH AND CASH EQUIVALENTS, END OF YEAR $ 553,391,696 $ 541,253,833 The accompanying notes are an integral part of the consolidated financial statements. (Concluded) - 14 - - 14 - Taiwan Semiconductor Manufacturing Company Limited and Subsidiaries NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2017 AND 2016 (Amounts in Thousands of New Taiwan Dollars, Unless Specified Otherwise) 1. GENERAL Taiwan Semiconductor Manufacturing Company Limited (TSMC), a Republic of China (R.O.C.) corporation, was incorporated on February 21, 1987. TSMC is a dedicated foundry in the semiconductor industry which engages mainly in the manufacturing, selling, packaging, testing and computer-aided design of integrated circuits and other semiconductor devices and the manufacturing of masks. On September 5, 1994, TSMC’s shares were listed on the Taiwan Stock Exchange (TWSE). On October 8, 1997, TSMC listed some of its shares of stock on the New York Stock Exchange (NYSE) in the form of American Depositary Shares (ADSs). The address of its registered office and principal place of business is No. 8, Li-Hsin Rd. 6, Hsinchu Science Park, Taiwan. The principal operating activities of TSMC’s subsidiaries are described in Note 4. 2. THE AUTHORIZATION OF FINANCIAL STATEMENTS The accompanying consolidated financial statements were approved and authorized for issue by the Board of Directors on February 13, 2018. 3. APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS a. Initial application of the amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) (collectively, “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC) Except for the following, the initial application of the amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the IFRSs endorsed and issued into effect by the FSC did not have a significant effect on TSMC and its subsidiaries’ (collectively as the “Company”) accounting policies: 1) Amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers The amendments stipulate that other companies or institutions of which the chairman of the board of directors or president serves as the chairman of the board of directors or the president, or is the spouse or second immediate family of the chairman of the board of directors or president of the Company are deemed to have a substantive related party relationship, unless it can be demonstrated that no control, joint control, or significant influence exists. Furthermore, the amendments require the disclosure of the names of the related parties and the relationship with whom the Company has transaction. If the transaction or balance with a specific related party is 10% or more of the Company’s respective total transaction or balance, such transaction should be separately disclosed by the name of each related party. When the amendments are applied retrospectively from January 1, 2017, the disclosure of related party transactions is enhanced, please refer to Note 34. - 15 - - 15 - b. The IFRSs issued by International Accounting Standards Board (IASB) and endorsed by FSC with effective date starting 2018 New, Revised or Amended Standards and Interpretations Effective Date Issued by IASB Annual Improvements to IFRSs 2014-2016 Cycle Amendment to IFRS 2 “Classification and Measurement of Note 1 January 1, 2018 Share-based Payment Transactions” IFRS 9 “Financial Instruments” Amendments to IFRS 9 and IFRS 7 “Mandatory Effective Date of January 1, 2018 January 1, 2018 IFRS 9 and Transition Disclosure” IFRS 15 “Revenue from Contracts with Customers” Amendment to IFRS 15 “Clarifications to IFRS 15” Amendment to IAS 7 “Disclosure Initiative” Amendment to IAS 12 “Recognition of Deferred Tax Assets for January 1, 2018 January 1, 2018 January 1, 2017 January 1, 2017 Unrealized Losses” IFRIC 22 “Foreign Currency Transactions and Advance January 1, 2018 Consideration” Note 1: The amendment to IFRS 12 is retrospectively applied for annual periods beginning on or after January 1, 2017; the amendment to IAS 28 is retrospectively applied for annual periods beginning on or after January 1, 2018. Except for the following items, the Company believes that the adoption of aforementioned standards or interpretations will not have a significant effect on the Company’s accounting policies. 1) IFRS 9 “Financial Instruments” and related amendments Classification, measurement and impairment of financial assets All recognized financial assets currently in the scope of IAS 39, “Financial Instruments: Recognition and Measurement,” will be subsequently measured at either the amortized cost or the fair value. The classification and measurement requirements in IFRS 9 are stated as follows: For the invested debt instruments, if the contractual cash flows that are solely for payments of principal and interest on the principal amount outstanding, the classification and measurement requirements are stated as follows: a) If the objective of business model is to hold the financial asset to collect the contractual cash flows, such assets are measured at the amortized cost. Interest revenue should be recognized in profit or loss by using the effective interest method, continuously assessed for impairment and the impairment loss or reversal of impairment loss should be recognized in profit and loss. b) If the objective of business model is to hold the financial asset both to collect the contractual cash flows and to sell the financial assets, such assets are measured at fair value through other comprehensive income (FVTOCI) and are continuously assessed for impairment. Interest revenue should be recognized in profit or loss by using the effective interest method. A gain or loss on a financial asset measured at fair value through other comprehensive income should be recognized in other comprehensive income, except for impairment gains or losses and foreign exchange gains and losses. When such financial asset is derecognized or reclassified, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss. - 16 - - 16 - The other financial assets which do not meet the aforementioned criteria should be measured at the fair value through profit or loss (FVTPL). However, the entity may irrevocably designate an investment in equity instruments that is not held for trading as measured at FVTOCI. All relevant gains and losses shall be recognized in other comprehensive income, except for dividends which are recognized in profit or loss. No subsequent impairment assessment is required, and the cumulative gain or loss previously recognized in other comprehensive income cannot be reclassified from equity to profit or loss. IFRS 9 adds a new expected loss impairment model to measure the impairment of financial assets. A loss allowance for expected credit losses should be recognized on financial assets measured at amortized cost and investments in debt instruments measured at fair value through other comprehensive income. If the credit risk on a financial instrument has not increased significantly since initial recognition, the loss allowance for that financial instrument should be measured at an amount equal to 12-month expected credit losses. If the credit risk on a financial instrument has increased significantly since initial recognition and is not deemed to be a low credit risk, the loss allowance for that financial instrument should be measured at an amount equal to the lifetime expected credit losses. A simplified approach is allowed for accounts receivables and the loss allowance could be measured at an amount equal to lifetime expected credit losses. The Company elects not to restate prior reporting period when applying the requirements for the classification, measurement and impairment of financial assets and financial liabilities under IFRS 9 with the cumulative effect of the initial application recognized at the date of initial application. The anticipated impact on measurement categories, carrying amount and related reconciliation for each class of the Company’s financial assets and financial liabilities when retrospectively applying IFRS 9 on January 1, 2018 is detailed below: Financial Assets IAS 39 IFRS 9 IAS 39 IFRS 9 Note Measurement Category Carrying Amount (1) (2) (3) (3) (4) (1) Cash and cash equivalents Derivatives Equity securities Debt securities Loans and receivables Held for trading Hedging instruments Available-for-sale Available-for-sale Amortized cost Mandatorily at FVTPL Hedging instruments FVTOCI Mandatorily at FVTPL $ 553,391,696 $ 553,391,696 569,751 34,394 8,389,438 779,489 569,751 34,394 7,422,311 - Notes and accounts receivable (including related parties), other receivables and refundable deposits Financial Liabilities Derivatives Short-term loans, accounts payable (including related parties), payables to contractors and equipment suppliers, accrued expenses and other current liabilities, bonds payable and guarantee deposits Held-to-maturity Loans and receivables FVTOCI Amortized cost Amortized cost 90,826,099 20,821,714 90,046,610 20,813,462 131,024,958 131,269,731 $ 26,709 15,562 340,501,266 340,501,266 26,709 $ 15,562 Held for trading Hedging instruments Amortized cost Mandatorily at FVTPL Hedging instruments Amortized cost - 17 - - 17 - Carrying Amount as of December 31, 2017 (IAS 39) Reclassifi- cations Remea- surements Carrying Amount as of January 1, 2018 (IFRS 9) Retained Earnings Effect on January 1, 2018 Other Equity Effect on January 1, 2018 Note $ 569,751 $ - $ - $ 569,751 $ - $ - - 569,751 - 779,489 779,489 - - - - 779,489 1,349,240 - (10,085 ) (10,085 ) - 10,085 10,085 - (3) - - - - - 7,422,311 967,127 8,389,438 1,294,528 (325,858 ) (2) 90,046,610 97,468,921 - - 967,127 - 90,046,610 98,436,048 - (30,658 ) 1,263,870 - 20,821,714 (8,252 ) 20,813,462 (8,252 ) - - 34,394 684,416,654 705,238,368 - 244,773 684,661,427 236,521 705,474,889 34,394 - 244,773 236,521 - 30,658 (295,200 ) (3) - - - - - (4) (1) Financial Assets FVTPL - Debt instruments Add: From available for sale FVTOCI - Equity instruments Add: From available for sale - Debt instruments Add: From available for sale Amortized cost Add: From held to maturity Add: From loans and receivables Hedging instruments Total $ 604,145 $ 803,486,778 $ 1,203,648 $ 805,294,571 $ 1,490,306 $ (285,115 ) Carrying Amount as of December 31, 2017 (IAS 39) Adjustments Arising from Initial Application Carrying Amount as of January 1, 2018 (IFRS 9) Retained Earnings Effect on January 1, 2018 Other Equity Effect on January 1, 2018 Note Investments accounted for using equity method $ 17,861,488 $ 8,258 $ 17,869,746 $ 33,984 $ (25,726) (5) (1) Cash and cash equivalents, notes and accounts receivable (including related parties), other receivables and refundable deposits were classified as loans and receivables under IAS 39 are now classified at amortized cost with assessment of future 12-month or lifetime expected credit loss under IFRS 9. As a result of retrospective application, the adjustments for accounts receivable would result in a decrease in loss of allowance of NT$244,773 thousand and an increase in retained earnings of NT$244,773 thousand on January 1, 2018. (2) As equity investments that were previously classified as available-for-sale financial assets under IAS 39 are not held for trading, the Company elected to designate all of these investments as at FVTOCI under IFRS 9. As a result, the related other equity-unrealized gain/loss on available-for-sale financial assets of NT$228,304 thousand is reclassified to increase other equity - unrealized gain/loss on financial assets at FVTOCI. As equity investments previously measured at cost under IAS 39 are remeasured at fair value under IFRS 9, the adjustments would result in an increase in financial assets at FVTOCI of NT$967,127 thousand, an increase in other equity-unrealized gain/loss on financial assets at FVTOCI of NT$968,670 thousand and a decrease in noncontrolling interests of NT$1,543 thousand on January 1, 2018. For those equity investments previously classified as available-for-sale financial assets (including measured at cost financial assets) under IAS 39, the impairment losses that the Company had recognized have been accumulated in retained earnings. Since these investments were designated as at FVTOCI under IFRS 9 and no impairment assessment is required, the adjustments would result in a decrease in other equity - unrealized gain/loss on financial assets at FVTOCI of NT$1,294,528 thousand and an increase in retained earnings of NT$1,294,528 thousand on January 1, 2018. - 18 - - 18 - (3) Debt investments were previously classified as available-for-sale financial assets under IAS 39. Under IFRS 9, except for debt instruments of NT$779,489 thousand whose contractual cash flows are not solely payments of principal and interest on the principal outstanding and therefore are classified as at FVTPL with the related other equity-unrealized gain/loss on available-for-sale financial assets of NT$10,085 thousand being consequently reclassified to decrease retained earnings, the remaining debt investments are classified as at FVTOCI with assessment of future 12-month expected credit loss because these investments are held within a business model whose objective is both to collect the contractual cash flows and sell the financial assets. The related other equity-unrealized gain/loss on available-for-sale financial assets of NT$434,403 thousand is reclassified to decrease other equity-unrealized gain/loss on financial assets at FVTOCI. As a result of retrospective application of future 12-month expected credit loss, the adjustments would result in an increase in other equity - unrealized gain/loss on financial assets at FVTOCI of NT$30,658 thousand and a decrease in retained earnings of NT$30,658 thousand on January 1, 2018. (4) Debt investments previously classified as held-to-maturity financial assets and measured at amortized cost under IAS 39 are classified as measured at amortized cost with assessment of future 12-month expected credit loss under IFRS 9 because the contractual cash flows are solely payments of principal and interest on the principal outstanding and these investments are held within a business model whose objective is to collect the contractual cash flows. As a result of retrospective application of future 12-month expected credit loss, the adjustments would result in an increase in loss allowance of NT$8,252 thousand and a decrease in retained earnings of NT$8,252 thousand on January 1, 2018. (5) With the retrospective adoption of IFRS 9 by associates accounted for using equity method, the corresponding adjustments made by the Company would result in an increase in investments accounted for using equity method of NT$8,258 thousand, a decrease in other equity- unrealized gain/loss on financial assets at FVTOCI of NT$23,616 thousand, a decrease in other equity- unrealized gain/loss on available-for-sale financial assets of NT$2,110 thousand and an increase in retained earnings of NT$33,984 thousand on January 1, 2018. Hedge accounting The main changes in hedge accounting amended the application requirements for hedge accounting to better reflect the entity’s risk management activities. Compared with IAS 39, the main changes include: (1) enhancing types of transactions eligible for hedge accounting, specifically broadening the risks eligible for hedge accounting of non-financial items; (2) changing the way the hedging cost of derivative instruments are accounted for to reduce profit or loss volatility; and (3) replacing retrospective effectiveness assessment with the principle of economic relationship between the hedging instrument and the hedged item. A preliminary assessment of the Company’s current hedging relationships indicates that they will qualify as continuing hedging relationships under IFRS 9. The Company will prospectively apply the requirements for hedge accounting upon initial application of IFRS 9. 2) IFRS 15 “Revenue from Contracts with Customers” and related amendments IFRS 15 establishes principles for recognizing revenue that apply to all contracts with customers, and will supersede IAS 18 “Revenue,” IAS 11 “Construction Contracts,” and a number of revenue-related interpretations. When applying IFRS 15, the Company shall recognize revenue by applying the following steps: Identify the contract with the customer; Identify the performance obligations in the contract; (cid:122) (cid:122) (cid:122) Determine the transaction price; - 19 - - 19 - (cid:122) Allocate the transaction price to the performance obligations in the contract; and (cid:122) Recognize revenue when the entity satisfies a performance obligation. The Company elects only to retrospectively apply IFRS 15 to contracts that were not completed on January 1, 2018 and elects not to restate prior reporting period with the cumulative effect of the initial application recognized at the date of initial application. The anticipated impact on assets, liabilities and equity when retrospectively applying IFRS 15 on January 1, 2018 is detailed below: Carrying Amount as of December 31, 2017 (IAS 18 and Revenue-related Interpretations) Adjustments Arising from Initial Application Carrying Amount as of January 1, 2018 (IFRS 15) Note Inventories Other financial assets-current Investments accounted for using equity method $ 73,880,747 $ 7,253,114 (19,746) $ 73,861,001 7,287,291 34,177 (1) (1) 17,861,488 19,483 17,880,971 (1) Total effect on assets $ 33,914 Provisions - current Accrued expenses and other current liabilities 13,961,787 $ (13,961,787) - (2) 65,588,396 13,961,787 79,550,183 (2) Total effect on liabilities $ - Retained earnings Non-controlling interests 1,233,362,010 $ 702,110 32,029 1,233,394,039 703,995 1,885 (1) (1) Total effect on equity $ 33,914 (1) Prior to the application of IFRS 15, the Company recognizes revenue based on the accounting treatment of the sales of goods. Under IFRS 15, certain subsidiaries and associates accounted for using equity method will change to recognize revenue over time because customers are deemed to have control over the products when the products are manufactured. As a result, the Company will recognize contract assets (classified under other financial assets) and adjust related assets and equity accordingly. (2) Prior to the application of IFRS 15, the Company recognized the estimation of sales returns and allowance as provisions. Under IFRS 15, the Company recognizes such estimation as refund liability (classified under accrued expenses and other current liabilities). Except for the aforementioned impact, as of the date the accompanying consolidated financial statements were authorized for issue, the Company continues in evaluating the impact on its financial position and financial performance as a result of the initial adoption of the other standards or interpretations. The related impact will be disclosed when the Company completes the evaluation. - 20 - - 20 - c. The IFRSs issued by IASB but not yet endorsed and issued into effect by FSC New, Revised or Amended Standards and Interpretations Effective Date Issued by IASB Annual Improvements to IFRSs 2015–2017 Cycle Amendments to IFRS 9 “Prepayment Features with Negative January 1, 2019 January 1, 2019 Compensation” Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets To be determined by IASB between an Investor and its Associate or Joint Venture” IFRS 16 “Leases” Amendments to IAS 19 “Plan Amendment, Curtailment or Settlement” January 1, 2019 (Note 2) January 1, 2019 Amendments to IAS 28 “Long-term Interests in Associates and Joint January 1, 2019 Ventures” IFRIC 23 “Uncertainty over Income Tax Treatments” January 1, 2019 Note 2: On December 19, 2017, the FSC announced that IFRS 16 will take effect starting January 1, 2019. Except for the following items, the Company believes that the adoption of aforementioned standards or interpretations will not have a significant effect on the Company’s accounting policies. 1) IFRS 16 “Leases” IFRS 16 sets out the accounting standards for leases that will supersede IAS 17 and a number of related interpretations. Under IFRS 16, if the Company is a lessee, it shall recognize right-of-use assets and lease liabilities for all leases on the consolidated balance sheets except for low-value and short-term leases. The Company may elect to apply the accounting method similar to the accounting for operating lease under IAS 17 to the low-value and short-term leases. On the consolidated statements of comprehensive income, the Company should present the depreciation expense charged on the right-of-use asset separately from interest expense accrued on the lease liability; interest is computed by using effective interest method. On the consolidated statements of cash flows, cash payments for both the principal and interest portion of the lease liability are classified within financing activities. When IFRS 16 becomes effective, the Company may elect to apply this Standard either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of the initial application of this Standard recognized at the date of initial application. Except for the aforementioned impact, as of the date the accompanying consolidated financial statements were authorized for issue, the Company continues in evaluating the impact on its financial position and financial performance as a result of the initial adoption of the other standards or interpretations. The related impact will be disclosed when the Company completes the evaluation. 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 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 R.O.C. 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 consolidated financial statements shall prevail. - 21 - - 21 - Statement of Compliance The accompanying consolidated financial statements have been prepared in conformity with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the IFRSs endorsed by the FSC with the effective dates (collectively, “Taiwan-IFRSs”). Basis of Preparation The accompanying consolidated financial statements have been prepared on the historical cost basis except for financial instruments that are measured at fair values, as explained in the accounting policies below. Historical cost is generally based on the fair value of the consideration given in exchange for the assets. Basis of Consolidation The basis for the consolidated financial statements The consolidated financial statements incorporate the financial statements of TSMC and entities controlled by TSMC (its subsidiaries). Income and expenses of subsidiaries acquired or disposed of are included in the consolidated statement of comprehensive income from the effective date of acquisition and up to the effective date of disposal, as appropriate. Total comprehensive income of subsidiaries is attributed to the shareholders of the parent and to the noncontrolling interests even if this results in the noncontrolling interests having a deficit balance. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the Company. All intra-group transactions, balances, income and expenses are eliminated in full on consolidation. Changes in the Company’s ownership interests in subsidiaries that do not result in the Company losing control over the subsidiaries are accounted for as equity transactions. The carrying amounts of the Company’s interests and the noncontrolling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the noncontrolling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to shareholders of the parent. When the Company loses control of a subsidiary, a gain or loss is recognized in profit or loss and is calculated as the difference between: a. the aggregate of the fair value of consideration received and the fair value of any retained interest at the date when control is lost; and b. the previous carrying amount of the assets (including goodwill), and liabilities of the subsidiary and any noncontrolling interest. The Company shall account for all amounts recognized in other comprehensive income in relation to the subsidiary on the same basis as would be required if the Company had directly disposed of the related assets and liabilities. The fair value of any investment retained in the former subsidiary at the date when control is lost is regarded as the cost on initial recognition of an investment in an associate. - 22 - - 22 - The subsidiaries in the consolidated financial statements The detail information of the subsidiaries at the end of reporting period was as follows: Name of Investor Name of Investee Main Businesses and Products Establishment and Operating Location Percentage of Ownership December 31, 2017 December 31, 2016 Note TSMC TSMC North America Selling and marketing of integrated circuits San Jose, California, TSMC Japan Limited (TSMC Japan) TSMC Partners, Ltd. (TSMC Partners) TSMC Korea Limited (TSMC Korea) and other semiconductor devices U.S.A. Customer service and supporting activities Yokohama, Japan Investing in companies involved in the Tortola, British Virgin design, manufacture, and other related business in the semiconductor industry and other investment activities Islands Customer service and supporting activities Seoul, Korea TSMC Europe B.V. (TSMC Customer service and supporting activities Amsterdam, the Europe) TSMC Global, Ltd. (TSMC Investment activities Global) TSMC China Company Manufacturing, selling, testing and Limited (TSMC China) computer-aided design of integrated circuits and other semiconductor devices Netherlands Tortola, British Virgin Islands Shanghai, China 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% TSMC Nanjing Company Manufacturing, selling, testing and Nanjing, China 100% 100% TSMC Partners VisEra Technologies Company Ltd. (VisEra Tech) TSMC Design Technology Canada Inc. (TSMC Canada) TSMC Technology, Inc. (TSMC Technology) TSMC Development, Inc. (TSMC Development) Limited (TSMC Nanjing) computer-aided design of integrated circuits and other semiconductor devices VentureTech Alliance Fund III, L.P. (VTAF III) VentureTech Alliance Fund Investing in new start-up technology Cayman Islands companies Investing in new start-up technology Cayman Islands II, L.P. (VTAF II) companies TSMC Solar Europe GmbH Selling of solar related products and Hamburg, Germany providing customer service Engaged in manufacturing electronic spare parts and in researching, developing, designing, manufacturing, selling, packaging and testing of color filter Hsinchu, Taiwan Engineering support activities Delaware, U.S.A. Investing in companies involved in the manufacturing related business in the semiconductor industry Delaware, U.S.A. InveStar Semiconductor Investing in new start-up technology Cayman Islands Development Fund, Inc. (ISDF) companies InveStar Semiconductor Investing in new start-up technology Cayman Islands Development Fund, Inc. (II) LDC. (ISDF II) companies 98% 98% 100% 87% 98% 98% 100% 87% 100% 100% 97% 97% 100% 100% 97% 97% Engineering support activities Ontario, Canada 100% 100% - a) a) a) a) - - b) a) a) a), c) d) a) a) - a) , e) a) , e) TSMC Development WaferTech, LLC Manufacturing, selling and testing of Washington, U.S.A. 100% 100% - (WaferTech) integrated circuits and other semiconductor devices VTAF III Mutual-Pak Technology Co., Ltd. (Mutual-Pak) VTAF III, VTAF II and TSMC Growth Fund Limited (Growth Fund) VentureTech Alliance Holdings, LLC (VTA Holdings) Manufacturing of electronic parts, New Taipei, Taiwan 39% 58% a) , f) wholesaling and retailing of electronic materials, and researching, developing and testing of RFID Investing in new start-up technology Cayman Islands companies Investing in new start-up technology Delaware, U.S.A. 100% - 100% 100% a) a) , g) companies Note a: This is an immaterial subsidiary for which the consolidated financial statements are not audited by the Company’s independent accountants. Note b: Under the investment agreement entered into with the municipal government of Nanjing, China on March 28, 2016, the Company will make an investment in Nanjing in the amount of approximately US$3 billion to establish a subsidiary operating a 300mm wafer fab with the capacity of 20,000 12-inch wafers per month, and a design service center. TSMC Nanjing was established in May 2016. Note c: TSMC Solar Europe GmbH is under liquidation procedures. Note d: To simplify investment structure, VisEra Tech owned by VisEra Holding Company (VisEra Holding) was transferred to TSMC in the third quarter of 2016. In October 2016, VisEra Holding was incorporated into TSMC Partners, the subsidiary of TSMC. Note e: ISDF and ISDF II are under liquidation procedures. Note f: Starting December 2017, the Company no longer had the majority of voting power and control over Mutual-Pak. As a result, Mutual-Pak is no longer consolidated and is accounted for using the equity method. Note g: VTA Holdings completed the liquidation procedures in April 2017. Foreign Currencies The financial statements of each individual consolidated entity were expressed in the currency which reflected its primary economic environment (functional currency). The functional currency of TSMC and presentation currency of the consolidated financial statements are both New Taiwan Dollars (NT$). In preparing the consolidated financial statements, the operating results and financial positions of each consolidated entity are translated into NT$. - 23 - - 23 - In preparing the financial statements of each individual consolidated entity, transactions in currencies other than the entity’s functional currency (foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Such exchange differences are recognized in profit or loss in the year in which they arise. Non-monetary items measured at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Exchange differences arising on the retranslation of non-monetary items are included in profit or loss for the year except for exchange differences arising on the retranslation of non-monetary items in respect of which gains and losses are recognized directly in other comprehensive income, in which case, the exchange differences are also recognized directly in other comprehensive income. Non-monetary items that are measured in terms of historical cost in foreign currencies are not retranslated. For the purposes of presenting consolidated financial statements, the assets and liabilities of the Company’s foreign operations are translated into NT$ using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period. Exchange differences arising, if any, are recognized in other comprehensive income and accumulated in equity (attributed to noncontrolling interests as appropriate). Classification of Current and Noncurrent Assets and Liabilities Current assets are assets held for trading purposes and assets expected to be converted to cash, sold or consumed within one year from the end of the reporting period. Current liabilities are obligations incurred for trading purposes and obligations expected to be settled within one year from the end of the reporting period. Assets and liabilities that are not classified as current are noncurrent assets and liabilities, respectively. Cash Equivalents Cash equivalents, for the purpose of meeting short-term cash commitments, consist of highly liquid time deposits and investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Financial Instruments Financial assets and liabilities shall be recognized when the Company becomes a party to the contractual provisions of the instruments. Financial assets and liabilities are initially recognized at fair values. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss. Financial Assets Financial assets are classified into the following specified categories: Financial assets “at FVTPL”, “held-to-maturity” financial assets, “available-for-sale” financial assets and “loans and receivables”. The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. Regular way purchases or sales of financial assets are recognized and derecognized on a trade date or settlement date basis for which financial assets were classified in the same way, respectively. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the marketplace. - 24 - - 24 - Financial assets at fair value through profit or loss Financial assets are classified as at fair value through profit or loss when the financial asset is either held for trading or it is designated as at fair value through profit or loss. Financial assets at fair value through profit or loss are stated at fair value, with any gains or losses arising on remeasurement recognized in profit or loss. Held-to-maturity financial assets Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturity dates that the Company has the positive intent and ability to hold to maturity. Subsequent to initial recognition, held-to-maturity financial assets are measured at amortized cost using the effective interest method less any impairment. Available-for-sale financial assets Available-for-sale financial assets are non-derivative financial assets that are either designated as available-for-sale or are not classified as (a) loans and receivables, (b) held-to-maturity financial assets or (c) financial assets at fair value through profit or loss. Available-for-sale financial assets are measured at fair value. Interest income from available-for-sale monetary financial assets and dividends on available-for-sale equity investments are recognized in profit or loss. Other changes in the carrying amount of available-for-sale financial assets are recognized in other comprehensive income. When the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously recognized in other comprehensive income is reclassified to profit or loss. Dividends on available-for-sale equity instruments are recognized in profit or loss when the Company’s right to receive the dividends is established. Available-for-sale equity instruments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured are measured at cost less any identified impairment losses at the end of each reporting period. Such equity instruments are subsequently remeasured at fair value when their fair value can be reliably measured, and the difference between the carrying amount and fair value is recognized in profit or loss or other comprehensive income. Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Loans and receivables including cash and cash equivalents, notes and accounts receivable and other receivables are measured at amortized cost using the effective interest method, less any impairment, except for those loans and receivables with immaterial discounted effect. Impairment of financial assets Financial assets, other than those carried at FVTPL, are assessed for indicators of impairment at the end of each reporting period. Those financial assets are 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 financial assets, their estimated future cash flows have been affected. For financial assets carried at amortized cost, such as trade receivables, assets that are assessed not to be impaired individually are, in addition, assessed for impairment on a collective basis. The Company assesses the collectability of receivables by performing the account aging analysis and examining current trends in the credit quality of its customers. - 25 - - 25 - For financial assets carried at amortized cost, the amount of the impairment loss is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate. For financial assets measured at amortized cost, if, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment loss was recognized, the previously recognized impairment loss is reversed through profit or loss to the extent that the carrying amount of the financial assets at the date the impairment loss is reversed does not exceed what the amortized cost would have been had the impairment loss not been recognized. When an available-for-sale financial asset is considered to be impaired, cumulative gains or losses previously recognized in other comprehensive income are reclassified to profit or loss in the year. In respect of available-for-sale equity instruments, impairment losses previously recognized in profit or loss are not reversed through profit or loss. Any increase in fair value subsequent to the recognition of an impairment loss is recognized in other comprehensive income and accumulated under the heading of unrealized gains or losses from available-for-sale financial assets. For financial assets carried at cost, the amount of the impairment loss is measured as the difference between the asset’s carrying amount and the present value of the estimated future cash flows discounted at the current market rate of return for a similar financial asset. Such impairment loss will not be reversed in subsequent periods. The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables, where the carrying amount is reduced through the use of an allowance account. When a trade receivable is considered uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Derecognition of financial assets The Company derecognizes a financial asset only when the contractual rights to the cash flows from the financial asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the financial asset to another entity. On derecognition of a financial asset in its entirety, the difference between the financial asset’s carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognized in other comprehensive income and accumulated in equity is recognized in profit or loss. Financial Liabilities and Equity Instruments Classification as debt or equity Debt and equity instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument. Equity instruments An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Company are recognized at the proceeds received, net of direct issue costs. - 26 - - 26 - Financial liabilities Financial liabilities are subsequently measured either at amortized cost using effective interest method or at FVTPL. Financial liabilities are classified as at fair value through profit or loss when the financial liability is either held for trading or is designated as at fair value through profit or loss. Financial liabilities at fair value through profit or loss are stated at fair value, with any gains or losses arising on remeasurement recognized in profit or loss. Financial liabilities other than those held for trading purposes and designated as at FVTPL are subsequently measured at amortized cost at the end of each reporting period. Derecognition of financial liabilities The Company derecognizes financial liabilities when, and only when, the Company’s obligations are discharged, cancelled or they expire. The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable is recognized in profit or loss. Derivative Financial Instruments Derivative financial instruments are initially recognized at fair value at the date the derivative contracts are entered into and are subsequently remeasured to their fair value at the end of each reporting period. The resulting gain or loss is recognized in profit or loss immediately unless the derivative financial instrument is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship. Financial Instruments Designated as at Fair Value through Profit or Loss A financial instrument may be designated as at FVTPL upon initial recognition. The financial instrument forms part of a group of financial assets or financial liabilities or both, which is managed and its performance is evaluated on a fair value basis, in accordance with the Company’s documented risk management or investment strategy, and information about the grouping is provided internally on that basis. Hedge Accounting Fair Value Hedge The Company designates certain hedging instruments, such as interest rate futures contracts, to partially hedge against the price risk caused by changes in interest rates in the Company’s investments in fixed income securities as fair value hedge. Changes in the fair value of hedging instrument that are designated and qualify as fair value hedges are recognized in profit or loss immediately, together with any changes in the fair value of the hedged asset that are attributable to the hedged risk. Cash Flow Hedge The Company designates certain hedging instruments, such as forward exchange contracts, to partially hedge its foreign exchange rate risks associated with certain highly probable forecast transactions, such as capital expenditures. The effective portion of changes in the fair value of hedging instruments is recognized in other comprehensive income. When the forecast transactions actually take place, the associated gains or losses that were recognized in other comprehensive income are removed from equity and included in the initial cost of the hedged items. The gains or losses from hedging instruments relating to the ineffective portion are recognized immediately in profit or loss. - 27 - - 27 - For the aforementioned fair value hedge and cash flow hedge, hedge accounting is discontinued prospectively when the Company revokes the designated hedging relationship, or when the hedging instruments expire or are sold, terminated, or exercised, or no longer meet the criteria for hedge accounting. Inventories Inventories are stated at the lower of cost or net realizable value. Inventories are recorded at standard cost and adjusted to approximate weighted-average cost at the end of the reporting period. Net realizable value represents the estimated selling price of inventories less all estimated costs of completion and costs necessary to make the sale. Investments Accounted for Using Equity Method Investments accounted for using the equity method are investments in associates. An associate is an entity over which the Company has significant influence and that is neither a subsidiary nor a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies. The operating results and assets and liabilities of associates are incorporated in these consolidated financial statements using the equity method of accounting. Under the equity method, an investment in an associate is initially recognized in the consolidated statement of financial position at cost and adjusted thereafter to recognize the Company’s share of profit or loss and other comprehensive income of the associate as well as the distribution received. The Company also recognizes its share in the changes in the equities of associates. Any excess of the cost of acquisition over the Company’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities of an associate recognized at the date of acquisition is recognized as goodwill, which is included within the carrying amount of the investment. Any excess of the Company’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition, after reassessment, is recognized immediately in profit or loss. When necessary, the entire carrying amount of the investment (including goodwill) is tested for impairment as a single asset by comparing its recoverable amount (higher of value in use and fair value less costs to sell) with its carrying amount. Any impairment loss recognized forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognized to the extent that the recoverable amount of the investment subsequently increases. The Company discontinues the use of the equity method from the date when the Company ceases to have significant influence over an associate. When the Company retains an interest in the former associate, the Company measures the retained interest at fair value at that date. The difference between the carrying amount of the associate at the date the equity method was discontinued, and the fair value of any retained interest and any proceeds from disposing of a part interest in the associate is included in the determination of the gain or loss on disposal of the associate. In addition, the Company shall account for all amounts recognized in other comprehensive income in relation to that associate on the same basis as would be required if the associate had directly disposed of the related assets or liabilities. If the Company’s ownership interest in an associate is reduced as a result of disposal, but the investment continues to be an associate, the Company should reclassify to profit or loss only a proportionate amount of the gain or loss previously recognized in other comprehensive income. When the Company subscribes to additional shares in an associate at a percentage different from its existing ownership percentage, the resulting carrying amount of the investment differs from the amount of the Company’s proportionate interest in the net assets of the associate. The Company records such a difference as an adjustment to investments with the corresponding amount charged or credited to capital surplus. If the Company’s ownership interest is reduced due to the additional subscription to the shares of associate by other investors, the proportionate amount of the gains or losses previously recognized in other - 28 - - 28 - comprehensive income in relation to that associate shall be reclassified to profit or loss on the same basis as would be required if the associate had directly disposed of the related assets or liabilities. When a consolidated entity transacts with an associate, profits and losses resulting from the transactions with the associate are recognized in the Company’s consolidated financial statements only to the extent of interests in the associate that are not owned by the Company. Property, Plant and Equipment Property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment. Costs include any incremental costs that are directly attributable to the construction or acquisition of the item of property, plant and equipment. Properties in the course of construction for production, supply or administrative purposes are carried at cost, less any recognized impairment loss. Such properties are classified to the appropriate categories of property, plant and equipment when completed and ready for intended use. Depreciation of these assets, on the same basis as other property assets, commences when the assets are ready for their intended use. Depreciation is recognized so as to write off the cost of the assets less their residual values over their useful lives, and it is computed using the straight-line method over the following estimated useful lives: land improvements - 20 years; buildings - 10 to 20 years; machinery and equipment - 2 to 5 years; office equipment - 3 to 5 years; and leased assets - 20 years. The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimates accounted for on a prospective basis. Land is not depreciated. Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets. However, when there is no reasonable certainty that ownership will be obtained by the end of the lease term, assets are depreciated over the shorter of the lease term and their useful lives. An item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the assets. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss. Leases Leases are classified as finance lease whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases. The Company as lessor Rental income from operating leases is recognized on a straight-line basis over the term of the relevant lease. The Company as lessee Assets held under finance lease are initially recognized as assets of the Company at the fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is recognized as an obligation under finance lease. Lease payments are apportioned between finance expense and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Operating lease payments are recognized as an expense on a straight-line basis over the lease term. - 29 - - 29 - Intangible Assets Goodwill Goodwill arising on an acquisition of a business is carried at cost as established at the date of acquisition of the business less accumulated impairment losses, if any. Other intangible assets Other separately acquired intangible assets with finite useful lives are carried at cost less accumulated amortization and accumulated impairment losses. Amortization is recognized using the straight-line method over the following estimated useful lives: Technology license fees - the estimated life of the technology or the term of the technology transfer contract; software and system design costs - 3 years or contract period; patent and others - the economic life or contract period. The estimated useful life and amortization method are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. Impairment of Tangible and Intangible Assets Goodwill Goodwill is not amortized and instead is tested for impairment annually, or more frequently when there is an indication that the cash generating unit may be impaired. For the purpose of impairment testing, goodwill is allocated to each of the Company’s cash-generating units or groups of cash-generating units that are expected to benefit from the synergies of the combination. If the recoverable amount of a cash-generating unit is less than its carrying amount, the difference is allocated first to reduce the carrying amount of any goodwill allocated to such cash generating unit and then to the other assets of the cash generating unit pro rata based on the carrying amount of each asset in the cash generating unit. Any impairment loss for goodwill is recognized directly in profit or loss. An impairment loss recognized for goodwill is not reversed in subsequent periods. Other tangible and intangible assets At the end of each reporting period, the Company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. When it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. When a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis can be identified. Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted. If the recoverable amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying amount of the asset or cash-generating unit is reduced to its recoverable amount. An impairment loss is recognized immediately in profit or loss. When an impairment loss subsequently reverses, the carrying amount of the asset or a cash-generating unit is increased to the revised estimate of its recoverable amount, but the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset or cash-generating unit in prior years. A reversal of an impairment loss is recognized immediately in profit or loss. - 30 - - 30 - Provision Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that the Company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows. Guarantee Deposit Guarantee deposit mainly consists of cash received under deposit agreements with customers to ensure they have access to the Company’s specified capacity; and as guarantee of accounts receivable to ensure payment from customers. Cash received from customers is recorded as guarantee deposit upon receipt. Guarantee deposits are refunded to customers when terms and conditions set forth in the deposit agreements have been satisfied. Revenue Recognition Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for estimated customer returns, rebates and other similar allowances. Sale of goods Revenue from the sale of goods is recognized when the goods are delivered and titles have passed, at which time all the following conditions are satisfied: (cid:121) The Company has transferred to the buyer the significant risks and rewards of ownership of the goods; (cid:121) The Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold; (cid:121) The amount of revenue can be measured reliably; (cid:121) (cid:121) The costs incurred or to be incurred in respect of the transaction can be measured reliably. It is probable that the economic benefits associated with the transaction will flow to the Company; and In principle, payment term granted to customers is due 30 days from the invoice date or 30 days from the end of the month of when the invoice is issued. Due to the short term nature of the receivables from sale of goods with the immaterial discounted effect, the Company measures them at the original invoice amounts without discounting. Royalties, dividend and interest income Revenue from royalties is recognized on an accrual basis in accordance with the substance of the relevant agreement, provided that it is probable that the economic benefits will flow to the Company and the amount of revenue can be measured reliably. Dividend income from investments is recognized when the shareholder’s right to receive payment has been established, provided that it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income from a financial asset is recognized when it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable. - 31 - - 31 - Employee Benefits Short-term employee benefits Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for service rendered by employees. Retirement benefits For defined contribution retirement benefit plans, payments to the benefit plan are recognized as an expense when the employees have rendered service entitling them to the contribution. For defined benefit retirement benefit plans, the cost of providing benefit is recognized based on actuarial calculations. Defined benefit costs (including service cost, net interest and remeasurement) under the defined benefit retirement benefit plans are determined using the Projected Unit Credit Method. Service cost (including current service cost), and net interest on the net defined benefit liability (asset) are recognized as employee benefits expense in the period they occur. Remeasurement, comprising actuarial gains and losses and the return on plan assets (excluding interest), is recognized in other comprehensive income in the period in which they occur. Remeasurement recognized in other comprehensive income is reflected immediately in retained earnings and will not be reclassified to profit or loss. Net defined benefit liability represents the actual deficit in the Company’s defined benefit plan. Taxation Income tax expense represents the sum of the tax currently payable and deferred tax. Current tax Income tax on unappropriated earnings (excluding earnings from foreign consolidated subsidiaries) is expensed in the year the shareholders approved the appropriation of earnings which is the year subsequent to the year the earnings are generated. Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax provision. Deferred tax Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the consolidated financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences, net operating loss carryforwards and tax credits for research and development expenses to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized. Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates, except where the Company is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments are only recognized to the extent that it is probable that there will be sufficient taxable profits against which to utilize the benefits of the temporary differences and they are expected to reverse in the foreseeable future. The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the deferred tax asset to be recovered. The deferred tax assets which originally not recognized is also reviewed at the end of each reporting period and recognized to the extent that it is probable that sufficient taxable profits will be available to allow all or part of the deferred tax asset to be recovered. - 32 - - 32 - Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the year in which the liability is settled or the asset is realized, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. Current and deferred tax for the year Current and deferred tax are recognized in profit or loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity, respectively. Insurance Claim The Company recognizes insurance claim reimbursement for losses incurred related to disaster damages. Insurance claim reimbursements are recorded, net of any deductible amounts, at the time while there is evidence that the claim reimbursement is virtually certain to be received. Government Grants Government grants are not recognized until there is reasonable assurance that the Company will comply with the conditions attaching to them and that the grants will be received. Government grants whose primary condition is that the Company should purchase, construct or otherwise acquire non-current assets (mainly including land use right and depreciable assets) are recognized as a deduction from the carrying amount of the related assets and recognized as a reduced depreciation or amortization charge in profit or loss over the contract period or useful lives of the related assets. Government grants that are receivables as compensation for expenses already incurred are deducted from incurred expenses in the period in which they become receivables. 5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION AND UNCERTAINTY In the application of the aforementioned Company’s accounting policies, the Company is required to make judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which the estimate is revised if the revision affects only that year, or in the year of the revision and future years if the revision affects both current and future years. Revenue Recognition The Company recognizes revenue when the conditions described in Note 4 are satisfied. The Company also records a provision for estimated future returns and other allowances in the same period the related revenue is recorded. Provision for estimated sales returns and other allowances is generally made and adjusted based on historical experience and the consideration of varying contractual terms, and the Company periodically reviews the adequacy of the estimation used. - 33 - - 33 - Impairment of Tangible and Intangible Assets Other than Goodwill In the process of evaluating the potential impairment of tangible and intangible assets other than goodwill, the Company is required to make subjective judgments in determining the independent cash flows, useful lives, expected future revenue and expenses related to the specific asset groups with the consideration of the nature of semiconductor industry. Any changes in these estimates based on changed economic conditions or business strategies could result in significant impairment charges or reversal in future years. Impairment of Goodwill The assessment of impairment of goodwill requires the Company to make subjective judgment to determine the identified cash-generating units, allocate the goodwill to relevant cash-generating units and estimate the recoverable amount of relevant cash-generating units. Impairment Assessment on Investment Using Equity Method The Company assesses the impairment of investments accounted for using the equity method whenever triggering events or changes in circumstances indicate that an investment may be impaired and carrying value may not be recoverable. The Company measures the impairment based on a projected future cash flow of the investees, including the underlying assumptions of sales growth rate and capacity utilization rate formulated by such investees’ internal management team. The Company also takes into account market conditions and the relevant industry trends to ensure the reasonableness of such assumptions. Realization of Deferred Income Tax Assets Deferred tax assets are recognized to the extent that it is probable that future taxable profits will be available against which those deferred tax assets can be utilized. Assessment of the realization of the deferred tax assets requires the Company’s subjective judgment and estimate, including the future revenue growth and profitability, tax holidays, the amount of tax credits can be utilized and feasible tax planning strategies. Any changes in the global economic environment, the industry trends and relevant laws and regulations could result in significant adjustments to the deferred tax assets. Valuation of Inventory Inventories are stated at the lower of cost or net realizable value, and the Company uses judgment and estimate to determine the net realizable value of inventory at the end of each reporting period. Due to the rapid technological changes, the Company estimates the net realizable value of inventory for obsolescence and unmarketable items at the end of reporting period and then writes down the cost of inventories to net realizable value. The net realizable value of the inventory is mainly determined based on assumptions of future demand within a specific time horizon. Recognition and Measurement of Defined Benefit Plans Net defined benefit liability and the resulting defined benefit costs under defined benefit pension plans are calculated using the Projected Unit Credit Method. Actuarial assumptions comprise the discount rate, rate of employee turnover, and future salary increase rate. Changes in economic circumstances and market conditions will affect these assumptions and may have a material impact on the amount of the expense and the liability. - 34 - - 34 -  6. CASH AND CASH EQUIVALENTS Cash and deposits in banks Agency bonds Commercial paper Repurchase agreements collateralized by corporate bonds December 31, 2017 December 31, 2016 $ 551,919,770 776,025 695,901 - $ 536,895,344 - 1,997,239 2,361,250 $ 553,391,696 $ 541,253,833 Deposits in banks consisted of highly liquid time deposits that were readily convertible to known amounts of cash and were subject to an insignificant risk of changes in value. 7. FINANCIAL ASSETS AND LIABILITIES AT FAIR VALUE THROUGH PROFIT OR LOSS Financial assets Held for trading Forward exchange contracts Cross currency swap contracts Designated as at FVTPL Time deposit Forward exchange contracts Financial liabilities Held for trading Forward exchange contracts Designated as at FVTPL Forward exchange contracts December 31, 2017 December 31, 2016 $ $ 569,751 - 569,751 142,406 10,976 153,382 - - - 6,297,708 22 6,297,730 $ 569,751 $ 6,451,112 $ 26,709 $ 91,585 - 99,550 $ 26,709 $ 191,135 The Company entered into derivative contracts to manage exposures due to fluctuations of foreign exchange rates. These derivative contracts did not meet the criteria for hedge accounting. Therefore, the Company did not apply hedge accounting treatment for these derivative contracts. - 35 - - 35 - Outstanding forward exchange contracts consisted of the following: December 31, 2017 Sell NT$/Buy EUR Sell NT$/Buy JPY Sell US$/Buy JPY Sell US$/Buy RMB Sell US$/Buy NT$ Sell RMB /Buy EUR Sell RMB/Buy JPY Sell RMB/Buy GBP December 31, 2016 Sell NT$/Buy EUR Sell NT$/Buy JPY Sell US$/Buy EUR Sell US$/Buy JPY Sell US$/Buy NT$ Sell US$/Buy RMB Maturity Date Contract Amount (In Thousands) January 2018 to February 2018 February 2018 January 2018 January 2018 January 2018 to February 2018 January 2018 January 2018 January 2018 NT$6,002,786/EUR169,000 NT$996,294/JPY3,800,000 US$2,191/JPY246,724 US$558,000/RMB3,679,575 US$1,661,500/NT$49,673,320 RMB38,967/EUR4,994 RMB409,744/JPY7,062,536 RMB3,637/GBP413 January 2017 January 2017 January 2017 January 2017 January 2017 to February 2017 January 2017 to June 2017 NT$5,393,329/EUR159,400 NT$7,314,841/JPY26,501,800 US$4,180/EUR4,000 US$428/JPY50,000 US$439,000/NT$14,138,202 US$421,750/RMB2,908,380 Outstanding cross currency swap contracts consisted of the following: Maturity Date December 31, 2016 Contract Amount (In Thousands) Range of Interest Rates Paid Range of Interest Rates Received January 2017 US$170,000/NT$5,487,600 3.98% - 8. AVAILABLE-FOR-SALE FINANCIAL ASSETS Corporate bonds Agency bonds/Agency mortgage-backed securities Asset-backed securities Government bonds Publicly traded stocks Commercial paper December 31, 2017 December 31, 2016 $ 40,165,148 29,235,388 13,459,545 7,817,723 2,548,054 148,295 $ 29,999,508 14,880,482 11,254,757 8,457,362 3,196,658 - $ 93,374,153 $ 67,788,767 - 36 - - 36 -  9. HELD-TO-MATURITY FINANCIAL ASSETS Corporate bonds Structured product Commercial paper Negotiable certificate of deposit Current portion Noncurrent portion 10. HEDGING DERIVATIVE FINANCIAL INSTRUMENTS Financial assets- current Fair value hedges Interest rate futures contracts Cash flow hedges Forward exchange contracts Financial liabilities- current Cash flow hedges Forward exchange contracts December 31, 2017 December 31, 2016 $ 19,338,764 1,482,950 - - $ 23,849,701 1,609,950 8,628,176 4,829,850 $ 20,821,714 $ 38,917,677 $ 1,988,385 18,833,329 $ 16,610,116 22,307,561 $ 20,821,714 $ 38,917,677 December 31, 2017 December 31, 2016 $ 27,016 $ 5,550 7,378 - $ 34,394 $ 5,550 $ 15,562 $ - The Company entered into interest rate futures contracts, which are used to hedge against the price risk caused by changes in interest rates in the Company’s investments in fixed income securities. The outstanding interest rate futures contracts consisted of the following: Maturity Period December 31, 2017 March 2018 December 31, 2016 March 2017 Contract Amount (US$ in Thousands) US$ 169,400 US$ 53,600 The Company entered into forward exchange contracts to partially hedge foreign exchange rate risks associated with certain highly probable forecast transactions, such as capital expenditures. These contracts have maturities of 12 months or less. - 37 - - 37 - Outstanding forward exchange contracts consisted of the following: Maturity Date Contract Amount (In Thousands) December 31, 2017 Sell NT$/Buy EUR February 2018 to May 2018 NT$2,649,104/EUR75,000 11. NOTES AND ACCOUNTS RECEIVABLE, NET Notes and accounts receivable Allowance for doubtful receivables December 31, 2017 December 31, 2016 $ 121,604,989 (471,741) $ 128,815,389 (480,118) Notes and accounts receivable, net $ 121,133,248 $ 128,335,271 In principle, the payment term granted to customers is due 30 days from the invoice date or 30 days from the end of the month of when the invoice is issued. The allowance for doubtful receivables is assessed by reference to the collectability of receivables by performing the account aging analysis, historical experience and current financial condition of customers. Except for those impaired, for the rest of the notes and accounts receivable, the account aging analysis at the end of the reporting period is summarized in the following table. There was no impairment concern for the accounts receivable that were past due without recognizing a specific allowance for doubtful receivables since there was no significant change in the credit quality of its customers after the assessment. In addition, the Company has obtained guarantee against certain receivables. Aging analysis of notes and accounts receivable, net Neither past due nor impaired Past due but not impaired Past due within 30 days Past due 31-60 days Past due 61-120 days Past due over 121 days December 31, 2017 December 31, 2016 $ 105,295,219 $ 108,411,408 13,984,125 929,672 582,821 341,411 15,017,824 1,844,726 3,061,313 - $ 121,133,248 $ 128,335,271 - 38 - - 38 - Movements of the allowance for doubtful receivables Individually Assessed for Impairment Collectively Assessed for Impairment Total Balance at January 1, 2017 Reversal/Write-off Effect of exchange rate changes $ 1,848 (1,848) - $ 478,270 (6,305) $ 480,118 (8,153) (224) (224) Balance at December 31, 2017 $ - $ 471,741 $ 471,741 Balance at January 1, 2016 Provision Reversal/Write-off Effect of exchange rate changes $ 10,241 - (8,393) - $ 478,010 321 - (61) $ 488,251 321 (8,393) (61) Balance at December 31, 2016 $ 1,848 $ 478,270 $ 480,118 Aging analysis of accounts receivable that is individually determined as impaired Past due over 121 days 12. INVENTORIES Finished goods Work in process Raw materials Supplies and spare parts December 31, 2017 December 31, 2016 $ - $ 1,848 December 31, 2017 December 31, 2016 $ 9,923,338 53,362,160 7,143,806 3,451,443 $ 8,521,873 33,330,870 4,012,190 2,817,300 $ 73,880,747 $ 48,682,233 Reversal of write-down of inventories resulting from the increase in net realizable value (excluding earthquake losses) and write-down of inventories to net realizable value (excluding earthquake losses) in the amount of NT$840,861 thousand and NT$1,542,779 thousand, respectively, were included in the cost of revenue for the years ended December 31, 2017 and 2016. Please refer to related earthquake losses in Note 38. 13. FINANCIAL ASSETS CARRIED AT COST Non-publicly traded stocks Mutual funds December 31, 2017 December 31, 2016 $ 2,532,287 2,341,970 $ 2,944,859 1,157,608 $ 4,874,257 $ 4,102,467 - 39 - - 39 - Since there is a wide range of estimated fair values of the Company’s investments in non-publicly traded stocks, the Company concludes that the fair value cannot be reliably measured and therefore should be measured at the cost less any impairment. The stocks of Aquantia and Impinj, Inc. were listed in November 2017 and July 2016, respectively. Accordingly, the Company reclassified the aforementioned investments from financial assets carried at cost to available-for-sale financial assets. 14. INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD Associates consisted of the following: Name of Associate Principal Activities Place of Incorporation and Operation Carrying Amount % of Ownership and Voting Rights Held by the Company December 31, December 31, December 31, December 31, 2017 2016 2017 Vanguard International Manufacturing, selling, Hsinchu, Taiwan $ 8,568,344 $ 8,806,384 28% Semiconductor Corporation (VIS) packaging, testing and computer-aided design of integrated circuits and other semiconductor devices and the manufacturing and design service of masks Systems on Silicon Manufacturing and selling of Singapore 5,677,640 7,163,516 Manufacturing Company Pte Ltd. (SSMC) Xintec Inc. (Xintec) integrated circuits and other semiconductor devices Wafer level chip size packaging and wafer level post passivation interconnection service Taoyuan, Taiwan 2,292,100 2,599,807 Global Unichip Corporation Researching, developing, Hsinchu, Taiwan 1,300,194 1,174,181 (GUC) Mutual-Pak manufacturing, testing and marketing of integrated circuits Manufacturing of electronic parts, wholesaling and retailing of electronic materials, and researching, developing and testing of RFID New Taipei, Taiwan 23,210 - 39% 41% 35% 39% $ 17,861,488 $ 19,743,888 2016 28% 39% 41% 35% - Starting December 2017, the Company no longer had the majority of voting power and control over Mutual-Pak. As a result, Mutual-Pak is no longer consolidated and is accounted for using the equity method. Starting June 2016, the Company has no longer served as Motech’s board of director. As a result, the Company exercises no significant influence over Motech. Therefore, Motech is no longer accounted for using the equity method. Further, such investment was reclassified to available-for-sale financial assets and the Company recognized a disposal loss of NT$259,960 thousand. As of December 31, 2017, no investments in associates are individually material to the Company. As of December 31, 2016, the summarized financial information in respect of each of the Company’s material associates is set out below. The summarized financial information below represents amounts shown in the associate’s financial statements prepared in accordance with Taiwan-IFRSs adjusted by the Company using the equity method of accounting. - 40 - - 40 - a. VIS Current assets Noncurrent assets Current liabilities Noncurrent liabilities Net revenue Income from operations Net income Other comprehensive income Total comprehensive income Cash dividends received December 31, 2016 $ 25,662,921 $ 9,501,442 $ 5,476,672 804,107 $ Year Ended December 31, 2016 $ 25,828,634 $ 6,083,625 $ 5,520,645 $ 5,592 $ 5,526,237 $ 1,206,981 Reconciliation of the above summarized financial information to the carrying amount of the interest in the associate was as follows: Net assets Percentage of ownership The Company’s share of net assets of the associate Goodwill Carrying amount of the investment b. SSMC Current assets Noncurrent assets Current liabilities Noncurrent liabilities Net revenue Income from operations Net income Total comprehensive income Cash dividends received - 41 - - 41 - December 31, 2016 $ 28,883,584 28% 8,179,830 626,554 $ 8,806,384 December 31, 2016 $ 14,585,150 $ 5,360,076 $ 1,746,602 286,340 $ Year Ended December 31, 2016 $ 14,045,927 $ 4,921,735 $ 4,918,140 $ 4,918,140 $ 4,076,170 Reconciliation of the above summarized financial information to the carrying amount of the interest in the associate was as follows: Net assets Percentage of ownership The Company’s share of net assets of the associate Goodwill Other adjustments Carrying amount of the investment December 31, 2016 $ 17,912,284 39% 6,948,175 213,984 1,357 $ 7,163,516 Aggregate information of associates that are not individually material was summarized as follows: The Company’s share of profits of associates The Company’s share of other comprehensive loss of associates The Company’s share of total comprehensive income of associates Year Ended December 31, 2016 $ 23,140 (5,244) $ $ 17,896 The market prices of the investments accounted for using the equity method in publicly traded stocks calculated by the closing price at the end of the reporting period are summarized as follows. The closing price represents the quoted price in active markets, the level 1 fair value measurement. Name of Associate VIS GUC Xintec 15. PROPERTY, PLANT AND EQUIPMENT December 31, 2017 December 31, 2016 $ 30,638,751 $ 11,905,404 $ 9,180,759 $ 26,089,360 $ 3,664,997 $ 3,622,227 Land and Land Improvements Buildings Machinery and Equipment Office Equipment Assets under Finance Leases Equipment under Installation and Construction in Progress Total Cost Balance at January 1, 2017 Additions (Deductions) Disposals or retirements Reclassification Effect of disposal of subsidiary Effect of exchange rate changes $ 4,049,292 - - - - (66,049 ) $ 304,404,474 75,594,667 (36,957 ) - - (827,571 ) $ 2,042,867,744 458,605,807 $ (9,552,995 ) 8,791 (51,216 ) (4,125,866 ) $ 34,729,640 8,195,896 (377,798 ) 1,507 (14,750 ) (142,979 ) Balance at December 31, 2017 $ 3,983,243 $ 379,134,613 $ 2,487,752,265 $ 42,391,516 $ Accumulated depreciation and impairment Balance at January 1, 2017 Additions Disposals or retirements Reclassification Effect of disposal of subsidiary Effect of exchange rate changes $ 524,845 27,790 - - - (42,137 ) $ 174,349,077 20,844,584 (28,816 ) - - (718,324 ) $ 1,577,377,509 229,985,588 $ (8,114,327 ) 8,195 (42,830 ) (3,765,293 ) 23,221,707 4,938,000 (377,470 ) 1,466 (13,838 ) (102,921 ) Balance at December 31, 2017 $ 510,498 $ 194,446,521 $ 1,795,448,842 $ 27,666,944 Carrying amounts at December 31, 2017 $ 3,472,745 $ 184,688,092 $ 692,303,423 $ 14,724,572 $ $ $ - - - - - - - - - - - - - - - $ 387,199,675 (219,902,510 ) $ 2,773,250,825 322,493,860 - - (518 ) 56,843 (9,967,750 ) 10,298 (66,484 ) (5,105,622 ) $ 167,353,490 $ 3,080,615,127 $ $ - - - - - - - $ 1,775,473,138 255,795,962 (8,520,613 ) 9,661 (56,668 ) (4,628,675 ) $ 2,018,072,805 $ 167,353,490 $ 1,062,542,322 (Continued) - 42 - - 42 - Land and Land Improvements Buildings Machinery and Equipment Office Equipment Assets under Finance Leases Equipment under Installation and Construction in Progress Total Cost Balance at January 1, 2016 Additions Disposals or retirements Reclassification Effect of exchange rate changes $ 4,067,391 - - - (18,099 ) $ 296,801,864 9,113,314 (13,372 ) - (1,497,332 ) $ 1,893,489,604 156,874,203 $ (3,094,143 ) - (4,401,920 ) $ 30,700,049 4,584,087 (469,235 ) 7,113 (92,374 ) Balance at December 31, 2016 $ 4,049,292 $ 304,404,474 $ 2,042,867,744 $ 34,729,640 $ Accumulated depreciation and impairment Balance at January 1, 2016 Additions Disposals or retirements Reclassification Effect of exchange rate changes $ 506,185 29,440 - - (10,780 ) $ 157,910,155 17,540,470 $ 1,385,857,655 198,189,423 $ (7,326 ) - (1,094,222 ) (3,049,502 ) - (3,620,067 ) 19,426,069 4,325,665 (468,401 ) 7,113 (68,739 ) Balance at December 31, 2016 $ 524,845 $ 174,349,077 $ 1,577,377,509 $ 23,221,707 Carrying amounts at December 31, 2016 $ 3,524,447 $ 130,055,397 $ 465,490,235 $ 11,507,933 $ $ $ 7,113 - - (7,113 ) - - 7,113 - - (7,113 ) - - - $ 192,111,548 195,255,966 $ 2,417,177,569 365,827,570 - - (167,839 ) (3,576,750 ) - (6,177,564 ) $ 387,199,675 $ 2,773,250,825 $ $ - - - - - - $ 1,563,707,177 220,084,998 (3,525,229 ) - (4,793,808 ) $ 1,775,473,138 $ 387,199,675 $ 997,777,687 (Concluded) The significant part of the Company’s buildings includes main plants, mechanical and electrical power equipment and clean rooms, and the related depreciation is calculated using the estimated useful lives of 20 years, 10 years and 10 years, respectively. 16. INTANGIBLE ASSETS Goodwill Technology License Fees Software and System Design Costs Patent and Others Total Cost Balance at January 1, 2017 Additions Retirements Reclassification Effect of disposal of subsidiary Effect of exchange rate changes $ $ $ 6,007,975 - - - (13,499 ) (345,774 ) 9,546,007 897,861 - - - (611 ) $ $ 22,243,595 3,021,085 (75,237 ) 7,662 (7,662 ) (3,225 ) 5,386,435 349,265 - (17,960 ) - (1,594 ) 43,184,012 4,268,211 (75,237 ) (10,298 ) (21,161 ) (351,204 ) Balance at December 31, 2017 $ 5,648,702 $ 10,443,257 $ 25,186,218 $ 5,716,146 $ 46,994,323 Accumulated amortization and impairment Balance at January 1, 2017 Additions Retirements Reclassification Impairment Effect of disposal of subsidiary Effect of exchange rate changes Balance at December 31, 2017 Carrying amounts at December 31, 2017 Cost Balance at January 1, 2016 Additions Retirements Effect of exchange rate changes $ $ $ $ $ $ - - - - 13,520 (13,499 ) (21 ) 6,147,200 1,548,263 - - - - (606 ) $ $ 18,144,428 2,310,742 (75,237 ) 7,409 - (7,554 ) (3,095 ) 4,277,538 487,731 - (17,070 ) - - (566 ) 28,569,166 4,346,736 (75,237 ) (9,661 ) 13,520 (21,053 ) (4,288 ) - $ 7,694,857 $ 20,376,693 $ 4,747,633 $ 32,819,183 5,648,702 $ 2,748,400 $ 4,809,525 $ 968,513 $ 14,175,140 $ 6,104,784 - - (96,809 ) 8,454,304 1,091,261 - 442 $ $ 19,474,428 2,788,512 (5,273 ) (14,072 ) 4,879,026 519,289 - (11,880 ) $ 38,912,542 4,399,062 (5,273 ) (122,319 ) Balance at December 31, 2016 $ 6,007,975 $ 9,546,007 $ 22,243,595 $ 5,386,435 $ 43,184,012 Accumulated amortization and impairment Balance at January 1, 2016 Additions Retirements Effect of exchange rate changes Balance at December 31, 2016 Carrying amounts at December 31, 2016 $ $ $ - - - - - $ 4,779,388 1,367,370 - 442 $ $ 16,431,666 1,730,834 (5,273 ) (12,799 ) 3,635,608 645,202 - (3,272 ) $ 24,846,662 3,743,406 (5,273 ) (15,629 ) $ 6,147,200 $ 18,144,428 $ 4,277,538 $ 28,569,166 6,007,975 $ 3,398,807 $ 4,099,167 $ 1,108,897 $ 14,614,846 - 43 - - 43 - The Company’s goodwill has been tested for impairment at the end of the annual reporting period and the recoverable amount is determined based on the value in use. The value in use was calculated based on the cash flow forecast from the financial budgets covering the future five-year period, and the Company used annual discount rates of 8.5% and 8.4% in its test of impairment as of December 31, 2017 and 2016, respectively, to reflect the relevant specific risk in the cash-generating unit. For the year ended December 31, 2017, the Company assessed goodwill impairment and recognized an impairment loss of NT$13,520 thousand related to a subsidiary since the operating result of this cash generating unit was not as expected and the recoverable amount of goodwill was nil. Such impairment loss was recognized in other operating income and expenses. For the year ended December 31, 2016, the Company did not recognize any impairment loss on goodwill. 17. OTHER ASSETS Tax receivable Prepaid expenses Others Current portion Noncurrent portion 18. SHORT-TERM LOANS Unsecured loans Amount Original loan content US$ (in thousands) Annual interest rate Maturity date December 31, 2017 December 31, 2016 $ 4,021,602 1,559,963 1,623,995 $ 2,325,825 1,007,026 1,553,003 $ 7,205,560 $ 4,885,854 $ 4,222,440 2,983,120 $ 3,385,422 1,500,432 $ 7,205,560 $ 4,885,854 December 31, 2017 December 31, 2016 $ 63,766,850 $ 57,958,200 $ 2,150,000 1.54%-1.82% Due by February $ 1,800,000 0.87%-1.07% Due by January 2018 2017 - 44 - - 44 - 19. PROVISIONS The Company’s current provisions were provisions for sales returns and allowances. Year ended December 31, 2017 Balance, beginning of year Provision Payment Effect of exchange rate changes Balance, end of year Year ended December 31, 2016 Balance, beginning of year Provision Payment Effect of exchange rate changes Balance, end of year Sales Returns and Allowances $ 18,037,789 44,833,557 (48,884,704) (24,855) $ 13,961,787 $ 10,163,536 36,519,312 (28,569,318) (75,741) $ 18,037,789 Provisions for sales returns and allowances are estimated based on historical experience and the consideration of varying contractual terms, and are recognized as a reduction of revenue in the same year of the related product sales. 20. BONDS PAYABLE Domestic unsecured bonds Overseas unsecured bonds Less: Discounts on bonds payable Less: Current portion December 31, 2017 December 31, 2016 $ 116,100,000 34,107,850 150,207,850 (6,728) (58,401,122) $ 154,200,000 37,028,850 191,228,850 (35,293) (38,100,000) $ 91,800,000 $ 153,093,557 The major terms of domestic unsecured bonds are as follows: Issuance Tranche Issuance Period Total Amount Coupon Rate Repayment and Interest Payment 100-1 100-2 A B A September 2011 to September 2016 September 2011 to September 2018 January 2012 to January 2017 $ 10,500,000 1.40% Bullet repayment; interest payable annually 7,500,000 1.63% The same as above 10,000,000 1.29% The same as above (Continued) - 45 - - 45 - Issuance Tranche Issuance Period Total Amount Coupon Rate Repayment and Interest Payment 100-2 101-1 101-2 101-3 101-4 102-1 102-2 102-3 102-4 102-4 B A B A B - A B C A B C A B A B A B C D E F January 2012 to January 2019 August 2012 to August 2017 August 2012 to August 2019 September 2012 to September 2017 September 2012 to September 2019 October 2012 to October 2022 January 2013 to January 2018 January 2013 to January 2020 January 2013 to January 2023 February 2013 to February 2018 February 2013 to February 2020 February 2013 to February 2023 $ 7,000,000 1.46% Bullet repayment; interest payable annually 9,900,000 1.28% The same as above 9,000,000 1.40% The same as above 12,700,000 1.28% The same as above 9,000,000 1.39% The same as above 4,400,000 1.53% The same as above 10,600,000 1.23% The same as above 10,000,000 1.35% The same as above 3,000,000 1.49% The same as above 6,200,000 1.23% The same as above 11,600,000 1.38% The same as above 3,600,000 1.50% The same as above July 2013 to July 2020 10,200,000 3,500,000 July 2013 to July 2023 4,000,000 August 2013 to August 2017 August 2013 to August 2019 September 2013 to September 2016 September 2013 to September 2017 September 2013 to March 2019 1,500,000 1,500,000 8,500,000 1,400,000 1.50% 1.70% 1.34% The same as above The same as above The same as above 1.52% The same as above 1.35% The same as above 1.45% The same as above 1.60% Bullet repayment; interest payable annually (interest for the six months prior to maturity will accrue on the basis of actual days and be repayable at maturity) September 2013 to March 2021 September 2013 to March 2023 September 2013 to September 2023 2,600,000 1.85% The same as above 5,400,000 2.05% The same as above 2,600,000 2.10% Bullet repayment; interest payable annually - 46 - - 46 - The major terms of overseas unsecured bonds are as follows: Issuance Period Total Amount (US$ in Thousands) Coupon Rate Repayment and Interest Payment April 2013 to April 2016 $ 350,000 0.95% Bullet repayment; interest payable April 2013 to April 2018 1,150,000 1.625% semi-annually The same as above 21. RETIREMENT BENEFIT PLANS a. Defined contribution plans The plan under the R.O.C. Labor Pension Act (the “Act”) is deemed a defined contribution plan. Pursuant to the Act, TSMC, Mutual-Pak and VisEra Tech have made monthly contributions equal to 6% of each employee’s monthly salary to employees’ pension accounts. Furthermore, TSMC North America, TSMC China, TSMC Nanjing, TSMC Europe, TSMC Canada, TSMC Technology and TSMC Solar Europe GmbH also make monthly contributions at certain percentages of the basic salary of their employees. Accordingly, the Company recognized expenses of NT$2,369,940 thousand and NT$2,164,900 thousand for the years ended December 31, 2017 and 2016, respectively. b. Defined benefit plans TSMC has defined benefit plans under the R.O.C. Labor Standards Law that provide benefits based on an employee’s length of service and average monthly salary for the six-month period prior to retirement. The Company contributes an amount equal to 2% of salaries paid each month to their respective pension funds (the Funds), which are administered by the Labor Pension Fund Supervisory Committee (the Committee) and deposited in the Committee’s name in the Bank of Taiwan. Before the end of each year, the Company assesses the balance in the Funds. If the amount of the balance in the Funds is inadequate to pay retirement benefits for employees who conform to retirement requirements in the next year, the Company is required to fund the difference in one appropriation that should be made before the end of March of the next year. The Funds are operated and managed by the government’s designated authorities; as such, the Company does not have any right to intervene in the investments of the Funds. Amounts recognized in respect of these defined benefit plans were as follows: Current service cost Net interest expense Components of defined benefit costs recognized in profit or loss Remeasurement on the net defined benefit liability: Return on plan assets (excluding amounts included in net interest expense) Actuarial loss arising from experience adjustments Actuarial loss(gain) arising from changes in financial assumptions Actuarial loss arising from changes in demographic assumptions Components of defined benefit costs recognized in other comprehensive income Years Ended December 31 2017 2016 $ $ 145,026 126,525 271,551 132,786 139,355 272,141 29,290 483,846 45,721 38,195 (258,455) 694,632 - 278,672 254,681 1,057,220 Total $ 526,232 $ 1,329,361 - 47 - - 47 - The pension costs of the aforementioned defined benefit plans were recognized in profit or loss by the following categories: Cost of revenue Research and development expenses General and administrative expenses Marketing expenses Years Ended December 31 2017 2016 $ 175,357 75,340 16,669 4,185 $ 176,977 73,395 17,367 4,402 $ 271,551 $ 272,141 The amounts arising from the defined benefit obligation of the Company were as follows: December 31, 2017 December 31, 2016 Present value of defined benefit obligation Fair value of plan assets $ 12,774,593 (3,923,889) $ 12,480,480 (3,929,072) Net defined benefit liability $ 8,850,704 $ 8,551,408 Movements in the present value of the defined benefit obligation were as follows: Balance, beginning of year Current service cost Interest expense Remeasurement losses (gains): Actuarial loss arising from experience adjustments Actuarial loss (gain) arising from changes in financial assumptions Actuarial loss arising from changes in demographic assumptions Benefits paid from plan assets Years Ended December 31 2017 2016 $ 12,480,480 145,026 185,561 $ 11,318,174 132,786 212,909 483,846 38,195 (258,455) 694,632 - (261,865) 278,672 (194,888) Balance, end of year $ 12,774,593 $ 12,480,480 Movements in the fair value of the plan assets were as follows: Balance, beginning of year Interest income Remeasurement losses: Years Ended December 31 2017 2016 $ 3,929,072 59,036 $ 3,870,148 73,554 Return on plan assets (excluding amounts included in net interest expense) Contributions from employer Benefits paid from plan assets (29,290) 226,936 (261,865) (45,721) 225,979 (194,888) Balance, end of year $ 3,923,889 $ 3,929,072 - 48 - - 48 - The fair value of the plan assets by major categories at the end of reporting period was as follows: Cash Equity instruments Debt instruments December 31, 2017 December 31, 2016 $ 707,477 1,993,336 1,223,076 $ 818,426 1,852,950 1,257,696 $ 3,923,889 $ 3,929,072 The actuarial valuations of the present value of the defined benefit obligation were carried out by qualified actuaries. The principal assumptions of the actuarial valuation were as follows: Discount rate Future salary increase rate Measurement Date December 31, 2017 December 31, 2016 1.65% 3.00% 1.50% 3.00% Through the defined benefit plans under the R.O.C. Labor Standards Law, the Company is exposed to the following risks: 1) Investment risk: The pension funds are invested in equity and debt securities, bank deposits, etc. The investment is conducted at the discretion of the government’s designated authorities or under the mandated management. However, under the R.O.C. Labor Standards Law, the rate of return on assets shall not be less than the average interest rate on a two-year time deposit published by the local banks and the government is responsible for any shortfall in the event that the rate of return is less than the required rate of return. 2) Interest risk: A decrease in the government bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the debt investments of the plan assets. Assuming a hypothetical decrease in interest rate at the end of the reporting period contributed to a decrease of 0.5% in the discount rate and all other assumptions were held constant, the present value of the defined benefit obligation would increase by NT$890,116 thousand and NT$970,282 thousand as of December 31, 2017 and 2016, respectively. 3) Salary risk: The present value of the defined benefit obligation is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the present value of the defined benefit obligation. Assuming the expected salary rate increases by 0.5% at the end of the reporting period and all other assumptions were held constant, the present value of the defined benefit obligation would increase by NT$873,801 thousand and NT$951,424 thousand as of December 31, 2017 and 2016, respectively. The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated. - 49 - - 49 - Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability. The Company expects to make contributions of NT$233,745 thousand to the defined benefit plans in the next year starting from December 31, 2017. The weighted average duration of the defined benefit obligation is 13 years. 22. GUARANTEE DEPOSITS Capacity guarantee Receivables guarantee Others Current portion (classified under accrued expenses and other current liabilities) Noncurrent portion December 31, 2017 December 31, 2016 $ 13,346,550 2,427,548 306,521 $ 20,929,350 5,559,960 181,312 $ 16,080,619 $ 26,670,622 $ 8,493,829 7,586,790 $ 12,000,189 14,670,433 $ 16,080,619 $ 26,670,622 Some of guarantee deposits were refunded to customers by offsetting related accounts receivable. 23. EQUITY a. Capital stock Authorized shares (in thousands) Authorized capital Issued and paid shares (in thousands) Issued capital December 31, 2017 December 31, 2016 28,050,000 $ 280,500,000 25,930,380 $ 259,303,805 28,050,000 $ 280,500,000 25,930,380 $ 259,303,805 A holder of issued common shares with par value of NT$10 per share is entitled to vote and to receive dividends. The authorized shares include 500,000 thousand shares allocated for the exercise of employee stock options. As of December 31, 2017, 1,068,165 thousand ADSs of TSMC were traded on the NYSE. The number of common shares represented by the ADSs was 5,340,823 thousand shares (one ADS represents five common shares). - 50 - - 50 - b. Capital surplus Additional paid-in capital From merger From convertible bonds From share of changes in equities of subsidiaries From share of changes in equities of associates Donations December 31, 2017 December 31, 2016 $ 24,184,939 22,804,510 8,892,847 118,792 289,240 19,208 $ 24,184,939 22,804,510 8,892,847 107,798 282,155 55 $ 56,309,536 $ 56,272,304 Under the relevant laws, the capital surplus generated from donations and the excess of the issuance price over the par value of capital stock (including the stock issued for new capital, mergers and convertible bonds) may be used to offset a deficit; in addition, when the Company has no deficit, such capital surplus may be distributed as cash dividends or stock dividends up to a certain percentage of TSMC’s paid-in capital. The capital surplus from share of changes in equities of subsidiaries and associates and dividend of a claim extinguished by a prescription may be used to offset a deficit; however, when generated from issuance of restricted shares for employees, such capital surplus may not be used for any purpose. c. Retained earnings and dividend policy In accordance with the amendments to the R.O.C. Company Act in May 2015, the recipients of dividends and bonuses are limited to shareholders and do not include employees. The amendments to TSMC’s Articles of Incorporation on earnings distribution policy had been approved by TSMC’s shareholders in its meeting held on June 7, 2016. For policy about the profit sharing bonus to employees, please refer to Note 31. TSMC’s amended Articles of Incorporation provide that, when allocating the net profits for each fiscal year, TSMC shall first offset its losses in previous years and then set aside the following items accordingly: 1) Legal capital reserve at 10% of the profits left over, until the accumulated legal capital reserve equals TSMC’s paid-in capital; 2) Special capital reserve in accordance with relevant laws or regulations or as requested by the authorities in charge; 3) Any balance left over shall be allocated according to the resolution of the shareholders’ meeting. TSMC’s Articles of Incorporation also provide that profits of TSMC may be distributed by way of cash dividend and/or stock dividend. However, distribution of earnings shall be made preferably by way of cash dividend. Distribution of earnings may also be made by way of stock dividend; provided that the ratio for stock dividend shall not exceed 50% of the total distribution. - 51 - - 51 - Any appropriations of the profits are subject to shareholders’ approval in the following year. The appropriation for legal capital reserve shall be made until the reserve equals the Company’s paid-in capital. The reserve may be used to offset a deficit, or be distributed as dividends in cash or stocks for the portion in excess of 25% of the paid-in capital if the Company incurs no loss. Pursuant to existing regulations, the Company is required to set aside additional special capital reserve equivalent to the net debit balance of the other components of stockholders’ equity, such as the accumulated balance of foreign currency translation reserve, unrealized valuation gain/loss from available-for-sale financial assets, gain/loss from changes in fair value of hedging instruments in cash flow hedges, etc. For the subsequent decrease in the deduction amount to stockholders’ equity, any special reserve appropriated may be reversed to the extent that the net debit balance reverses. The appropriations of 2016 and 2015 earnings have been approved by TSMC’s shareholders in its meetings held on June 8, 2017 and June 7, 2016, respectively. The appropriations and dividends per share were as follows: Appropriation of Earnings For Fiscal Year 2015 For Fiscal Year 2016 Dividends Per Share (NT$) For Fiscal Year 2016 For Fiscal Year 2015 $ 33,424,718 $ 30,657,384 Legal capital reserve Cash dividends to shareholders 181,512,663 155,582,283 $ 7 $ 6 $ 214,937,381 $ 186,239,667 TSMC’s appropriations of earnings for 2017 had been approved in the meeting of the Board of Directors held on February 13, 2018. The appropriations and dividends per share were as follows: Legal capital reserve Special capital reserve Cash dividends to shareholders Appropriation of Earnings For Fiscal Year 2017 Dividends Per Share (NT$) For Fiscal Year 2017 $ 34,311,148 26,907,527 207,443,044 $ 268,661,719 $ 8 The appropriations of earnings for 2017 are to be presented for approval in the TSMC’s shareholders’ meeting to be held on June 5, 2018 (expected). Under the Integrated Income Tax System that became effective on January 1, 1998, the R.O.C. resident shareholders are allowed a tax credit for their proportionate share of the income tax paid by TSMC on earnings generated since January 1, 1998. - 52 - - 52 - d. Others Changes in others were as follows: Year Ended December 31, 2017 Foreign Currency Translation Reserve Unrealized Gain/Loss from Available-for- sale Financial Assets Cash Flow Hedges Reserve Unearned Stock-Based Employee Compensation Total Balance, beginning of year Exchange differences arising on translation of $ 1,661,237 $ 2,641 $ 105 $ - $ 1,663,983 foreign operations (28,257,449 ) - - (28,257,449 ) Changes in fair value of available-for-sale financial assets Cumulative (gain)/loss reclassified to profit or loss upon disposal of available-for-sale financial assets Gain/(loss) arising on changes in the fair value of hedging instruments Transferred to initial carrying amount of hedged items Share of other comprehensive income (loss) of associates Share of unearned stock-based employee compensation of associates Income tax effect - - - (154,680 ) (61,182 ) - - - - - - 99,534 (94,851 ) (101,468 ) 2,121 - - - - (2,974 ) - (562 ) (10,290 ) - - - - - - (154,680 ) (61,182 ) 99,534 (94,851 ) (99,347 ) (10,290 ) (3,536 ) Balance, end of year $ (26,697,680 ) $ (214,074 ) $ 4,226 $ (10,290 ) $ (26,917,818 ) Foreign Currency Translation Reserve Year Ended December 31, 2016 Unrealized Gain/Loss from Available-for- sale Financial Assets Cash Flow Hedges Reserve Total Balance, beginning of year Exchange differences arising on $ 11,039,949 $ 734,771 $ (607) $ 11,774,113 translation of foreign operations (9,409,190) Other comprehensive income reclassified to profit or loss upon disposal of subsidiaries Changes in fair value of available-for-sale financial assets Cumulative (gain)/loss reclassified to profit or loss upon disposal of available-for-sale financial assets Share of other comprehensive income (loss) of associates Other comprehensive loss reclassified to profit or loss upon disposal of associates Income tax effect 36,105 - - (915) (4,712) - - - (696,240) 4,071 24,684 (3,469) (61,176) - - - - 712 - - (9,409,190) 36,105 (696,240) 4,071 24,481 (8,181) (61,176) Balance, end of year $ 1,661,237 $ 2,641 $ 105 $ 1,663,983 The aforementioned other equity includes the changes in other equities of TSMC and TSMC’s share of its subsidiaries and associates. - 53 - - 53 - 24. NET REVENUE Net revenue from sale of goods Net revenue from royalties 25. OTHER OPERATING INCOME AND EXPENSES, NET Gain (loss) on disposal or retirement of property, plant and equipment, net Others 26. OTHER INCOME Interest income Bank deposits Available-for-sale financial assets Held-to-maturity financial assets Structured product Dividend income 27. FINANCE COSTS Interest expense Corporate bonds Bank loans Others Years Ended December 31 2017 2016 $ 976,923,256 523,985 $ 947,415,900 522,444 $ 977,447,241 $ 947,938,344 Years Ended December 31 2017 2016 $ (1,097,908) $ (267,603) 46,548 (16,735) $ (1,365,511) $ 29,813 Years Ended December 31 2017 2016 $ 6,412,823 2,091,435 568,552 391,896 9,464,706 145,588 $ 4,892,652 816,185 383,261 225,402 6,317,500 137,401 $ 9,610,294 $ 6,454,901 Years Ended December 31 2017 2016 $ 2,563,544 766,625 144 $ 3,014,753 291,178 222 $ 3,330,313 $ 3,306,153 - 54 - - 54 - 28. OTHER GAINS AND LOSSES, NET Gain (loss) on disposal of financial assets, net Available-for-sale financial assets Financial assets carried at cost Loss on disposal of investments accounted for using equity method, $ 76,986 12,809 $ (4,014) 37,241 Years Ended December 31 2017 2016 net Gain (loss) from disposal of subsidiaries Other gains Net gain (loss) on financial instruments at FVTPL Held for trading Designated as at FVTPL Gain (loss) arising from fair value hedges, net Impairment loss of financial assets Financial assets carried at cost Other losses 29. INCOME TAX a. Income tax expense recognized in profit or loss Income tax expense consisted of the following: Current income tax expense Current tax expense recognized in the current year Income tax adjustments on prior years Other income tax adjustments Deferred income tax expense (benefit) Effect of tax rate changes The origination and reversal of temporary differences Investment tax credits and operating loss carryforward - 17,343 409,852 2,253,651 131,037 (30,293) (259,960) (36,105) 176,734 467,051 (37,369) 16,973 (29,603) (24,424) (122,240) (42,379) $ 2,817,358 $ 195,932 Years Ended December 31 2017 2016 $ 57,503,831 (896,147) 152,790 56,760,474 $ 54,315,433 (1,041,762) 122,461 53,396,132 561,818 (4,336,110) - (3,774,292) - (1,775,023) 35 (1,774,988) Income tax expense recognized in profit or loss $ 52,986,182 $ 51,621,144 - 55 - - 55 - A reconciliation of income before income tax and income tax expense recognized in profit or loss was as follows: Years Ended December 31 2017 2016 Income before tax $ 396,133,030 $ 385,959,380 Income tax expense at the statutory rate Tax effect of adjusting items: Deductible items in determining taxable income Tax-exempt income Additional income tax on unappropriated earnings Effect of tax rate changes on deferred income tax The origination and reversal of temporary differences Income tax credits Remeasurement of operating loss carryforward Income tax adjustments on prior years Other income tax adjustments $ 69,608,602 $ 66,945,088 (1,410,955) (16,901,134) 11,835,948 561,818 (4,336,110) (5,628,630) - 53,729,539 (896,147) 152,790 (51,324) (19,594,962) 11,957,213 - (1,775,023) (4,940,147) (400) 52,540,445 (1,041,762) 122,461 Income tax expense recognized in profit or loss $ 52,986,182 $ 51,621,144 For the years ended December 31, 2017 and 2016, the Company applied a tax rate of 17% for entities subject to the R.O.C. Income Tax Law; for other jurisdictions, the Company measures taxes by using the applicable tax rate for each individual jurisdiction. In January 2018, it was announced that the Income Tax Law in the R.O.C. was amended and, starting from 2018, the corporate income tax rate will be adjusted from 17% to 20%. In addition, the tax rate applicable to unappropriated earnings will be reduced from 10% to 5%. Deferred tax assets and deferred tax liabilities recognized as of December 31, 2017 are expected to be adjusted and would increase by NT$1,473,065 thousand and NT$15,096 thousand, respectively, in 2018. b. Income tax expense recognized in other comprehensive income Deferred income tax benefit (expense) Related to remeasurement of defined benefit obligation Related to unrealized gain/loss on available-for-sale financial assets Related to gain/loss on cash flow hedges Years Ended December 31 2017 2016 $ 30,562 $ 126,867 (2,974) (562) (61,176) - $ 27,026 $ 65,691 - 56 - - 56 - c. Deferred income tax balance The analysis of deferred income tax assets and liabilities was as follows: Deferred income tax assets Temporary differences Depreciation Provision for sales returns and allowance Net defined benefit liability Unrealized loss on inventories Deferred compensation cost Others Operating loss carryforward Deferred income tax liabilities Temporary differences Unrealized exchange gains Available-for-sale financial assets Cash flow hedges December 31, 2017 December 31, 2016 $ 8,401,266 1,637,713 975,324 629,442 266,521 195,197 - $ 4,244,214 1,512,061 939,543 737,247 378,740 445,133 14,483 $ 12,105,463 $ 8,271,421 $ (169,480) $ (95,421) (37,304) (48,736) (92,447) - $ (302,205) $ (141,183) Deferred income tax assets Temporary differences Depreciation Provision for sales returns and allowance Net defined benefit liability Unrealized loss on inventories Deferred compensation cost Others Operating loss carryforward Deferred income tax liabilities Temporary differences Unrealized exchange gains Available-for-sale financial assets Cash flow hedges Year Ended December 31, 2017 Recognized in Balance, Beginning of Year Profit or Loss Other Comprehensive Income Effect of Disposal of Subsidiary Effect of Exchange Rate Changes Balance, End of Year $ 4,244,214 $ 4,207,209 $ 1,512,061 939,543 737,247 378,740 445,133 14,483 129,971 5,219 (105,068 ) (83,124 ) (222,429 ) - $ - - 30,562 - - - - - - - - - - (14,483 ) $ (50,157 ) $ 8,401,266 (4,319 ) - (2,737 ) (29,095 ) (27,507 ) - 1,637,713 975,324 629,442 266,521 195,197 - $ 8,271,421 $ 3,931,778 $ 30,562 $ (14,483 ) $ (113,815 ) $ 12,105,463 $ (48,736 ) $ (120,744 ) $ - $ (92,447 ) - - (36,742 ) (2,974 ) (562 ) $ (141,183 ) $ (157,486 ) $ (3,536 ) $ - - - - $ $ - - - - $ (169,480 ) (95,421 ) (37,304 ) $ (302,205 ) - 57 - - 57 - Deferred income tax assets Temporary differences Depreciation Provision for sales returns and allowance Net defined benefit liability Unrealized loss on inventories Deferred compensation cost Goodwill from business combination Others Operating loss carryforward Deferred income tax liabilities Temporary differences Available-for-sale financial assets Unrealized exchange gains Year Ended December 31, 2016 Recognized in Balance, Beginning of Year Profit or Loss Other Comprehensive Income Effect of Exchange Rate Changes Balance, End of Year $ 2,852,961 1,141,511 895,486 622,741 316,283 10,025 531,449 14,518 $ $ 1,437,648 371,410 (82,810 ) 115,490 69,311 (9,836 ) (77,454 ) (35 ) - - 126,867 - - - - - $ $ (46,395 ) (860 ) - (984 ) (6,854 ) (189 ) (8,862 ) - 4,244,214 1,512,061 939,543 737,247 378,740 - 445,133 14,483 $ 6,384,974 $ 1,823,724 $ 126,867 $ (64,144 ) $ 8,271,421 $ (31,271 ) - $ - (48,736 ) $ (61,176 ) - $ $ (31,271 ) $ (48,736 ) $ (61,176 ) $ - - - $ (92,447 ) (48,736 ) $ (141,183 ) d. The investment operating loss carryforward and deductible temporary differences for which no deferred income tax assets have been recognized The information of the operating loss carryforward for which no deferred tax assets have been recognized was as follows: Expiry period 1 - 4 years 5 - 10 years December 31, 2017 December 31, 2016 $ $ - - - $ 136,703 41,389 $ 178,092 As of December 31, 2017 and 2016, the aggregate deductible temporary differences for which no deferred income tax assets have been recognized amounted to NT$26,536,307 thousand and NT$1,919,784 thousand, respectively. e. Unused tax-exemption information As of December 31, 2017, the profits generated from the following projects of TSMC are exempt from income tax for a five-year period: Construction and expansion of 2007 by TSMC Construction and expansion of 2008 by TSMC Construction and expansion of 2009 by TSMC Tax-exemption Period 2014 to 2018 2015 to 2019 2018 to 2022 f. The information of unrecognized deferred income tax liabilities associated with investments As of December 31, 2017 and 2016, the aggregate taxable temporary differences associated with investments to NT$95,003,344 thousand and NT$83,181,401 thousand, respectively. in subsidiaries not recognized as deferred liabilities amounted income tax - 58 - - 58 - g. Integrated income tax information Balance of the Imputation Credit Account - TSMC December 31, 2017 December 31, 2016 $ 114,264,283 $ 82,072,562 The estimated and actual creditable ratio for distribution of TSMC’s earnings of 2017 and 2016 were 14.69% and 13.90%, respectively; while the creditable ratio for individual shareholders residing in the R.O.C. is half of the original creditable ratio according to the R.O.C. Income Tax Law. However, effective from January 1, 2018, integrated income tax system were abrogated and imputation credit account is no longer applicable based on amended R.O.C. Income Tax Law in January 2018. All of TSMC’s earnings generated prior to December 31, 1997 have been appropriated. h. Income tax examination The tax authorities have examined income tax returns of TSMC through 2014. All investment tax credit adjustments assessed by the tax authorities have been recognized accordingly. 30. EARNINGS PER SHARE Basic EPS Diluted EPS EPS is computed as follows: Years Ended December 31 2017 2016 $ 13.23 $ 13.23 $ 12.89 $ 12.89 Number of Shares (Denominator) (In Thousands) Amounts (Numerator) EPS (NT$) Year ended December 31, 2017 Basic/Diluted EPS Net income available to common shareholders of the parent $ 343,111,476 25,930,380 $ 13.23 Year ended December 31, 2016 Basic/Diluted EPS Net income available to common shareholders of the parent $ 334,247,180 25,930,380 $ 12.89 - 59 - - 59 - 31. ADDITIONAL INFORMATION OF EXPENSES BY NATURE Years Ended December 31 2017 2016 a. Depreciation of property, plant and equipment Recognized in cost of revenue Recognized in operating expenses Recognized in other operating income and expenses $ 235,985,189 19,746,263 64,510 $ 203,476,848 16,583,067 25,083 b. Amortization of intangible assets Recognized in cost of revenue Recognized in operating expenses $ 255,795,962 $ 220,084,998 $ 2,135,521 2,211,215 $ 2,028,492 1,714,914 $ 4,346,736 $ 3,743,406 c. Research and development expenses $ 80,732,463 $ 71,207,703 d. Employee benefits expenses Post-employment benefits Defined contribution plans Defined benefit plans Other employee benefits Employee benefits expense summarized by function Recognized in cost of revenue Recognized in operating expenses $ 2,369,940 271,551 2,641,491 101,488,608 $ 2,164,900 272,141 2,437,041 97,248,082 $ 104,130,099 $ 99,685,123 $ 61,026,107 43,103,992 $ 58,493,500 41,191,623 $ 104,130,099 $ 99,685,123 In accordance with the amendments to the R.O.C. Company Act in May 2015 and the amended TSMC’s Articles of Incorporation approved by TSMC’s shareholders in its meeting held on June 7, 2016, TSMC shall allocate compensation to directors and profit sharing bonus to employees of TSMC not more than 0.3% and not less than 1% of annual profits during the period, respectively. TSMC accrued profit sharing bonus to employees based on a percentage of net income before income tax, profit sharing bonus to employees and compensation to directors during the period, which amounted to NT$23,019,082 thousand and NT$22,418,339 thousand for the years ended December 31, 2017 and 2016, respectively; compensation to directors was expensed based on estimated amount payable. If there is a change in the proposed amounts after the annual consolidated financial statements are authorized for issue, the differences are recorded as a change in accounting estimate. - 60 - - 60 - TSMC’s profit sharing bonus to employees and compensation to directors in the amounts of NT$23,019,082 thousand and NT$368,919 thousand in cash for 2017, respectively, and profit sharing bonus to employees and compensation to directors in the amounts of NT$22,418,339 thousand and NT$376,432 thousand in cash for 2016, respectively, had been approved by the Board of Directors of TSMC held on February 13, 2018 and February 14, 2017, respectively. There is no significant difference between the aforementioned approved amounts and the amounts charged against earnings of 2017 and 2016, respectively. TSMC’s profit sharing bonus to employees and compensation to directors in the amounts of NT$20,556,888 thousand and NT$356,186 thousand in cash for 2015, respectively, had been approved by the Board of Directors on February 2, 2016. The profit sharing bonus to employees and compensation to directors in cash for 2015 had been reported to TSMC’s shareholders in its meeting held on June 7, 2016, after the amended TSMC’s Articles of Incorporation had been approved. The aforementioned approved amount has no difference with the one recognized in the consolidated financial statements for the year ended December 31, 2015. The information about the appropriations of TSMC’s profit sharing bonus to employees and compensation to directors is available at the Market Observation Post System website. 32. CAPITAL MANAGEMENT The Company requires significant amounts of capital to build and expand its production facilities and acquire additional equipment. In consideration of the industry dynamics, the Company manages its capital in a manner to ensure that it has sufficient and necessary financial resources to fund its working capital needs, capital asset purchases, research and development activities, dividend payments, debt service requirements and other business requirements associated with its existing operations over the next 12 months. 33. FINANCIAL INSTRUMENTS a. Categories of financial instruments Financial assets FVTPL (Note 1) Available-for-sale financial assets (Note 2) Held-to-maturity financial assets Hedging derivative financial assets Loans and receivables (Note 3) Financial liabilities FVTPL (Note 1) Hedging derivative financial liabilities Amortized cost (Note 4) Note 1: Including held for trading and designated as at FVTPL. Note 2: Including financial assets carried at cost. - 61 - - 61 - December 31, 2017 December 31, 2016 $ 569,751 98,248,410 20,821,714 34,394 684,416,654 $ 6,451,112 71,891,234 38,917,677 5,550 673,592,938 $ 804,090,923 $ 790,858,511 $ 26,709 15,562 340,501,266 $ 191,135 - 387,046,137 $ 340,543,537 $ 387,237,272 Note 3: Including cash and cash equivalents, notes and accounts receivable (including related parties), other receivables and refundable deposits. Note 4: Including short-term loans, accounts payable (including related parties), payables to contractors and equipment suppliers, accrued expenses and other current liabilities, bonds payable, long-term bank loans, and guarantee deposits. b. Financial risk management objectives The Company seeks to ensure sufficient cost-efficient funding readily available when needed. The Company manages its exposure to foreign currency risk, interest rate risk, equity price risk, credit risk and liquidity risk with the objective to reduce the potentially adverse effects the market uncertainties may have on its financial performance. The plans for material treasury activities are reviewed by Audit Committees and/or Board of Directors in accordance with procedures required by relevant regulations or internal controls. During the implementation of such plans, Corporate Treasury function must comply with certain treasury procedures that provide guiding principles for overall financial risk management and segregation of duties. c. Market risk The Company is exposed to the financial market risks, primarily changes in foreign currency exchange rates, interest rates and equity investment prices. Foreign currency risk Most of the Company’s operating activities are denominated in foreign currencies. Consequently, the Company is exposed to foreign currency risk. To protect against reductions in value and the volatility of future cash flows caused by changes in foreign exchange rates, the Company utilizes derivative financial instruments, such as forward exchange contracts and cross currency swaps, and non-derivative financial instruments, such as foreign currency-denominated debt, to partially hedge its currency exposure. The Company’s sensitivity analysis of foreign currency risk mainly focuses on the foreign currency monetary items and the derivatives financial instruments at the end of the reporting period. Assuming an unfavorable 10% movement in the levels of foreign exchanges relative to the New Taiwan dollar, the net income for the years ended December 31, 2017 and 2016 would have decreased by NT$867,910 thousand and NT$111,347 thousand, respectively, and the other comprehensive income for the year ended December 31, 2017 would have decreased by NT$265,875 thousand. Interest rate risk The Company is exposed to interest rate risk primarily related to its outstanding debt and investments in fixed income securities. All of the Company’s bonds payable have fixed interest rates and are measured at amortized cost. As such, changes in interest rates would not affect the future cash flows. On the other hand, because interest rates of the Company’s long-term bank loans are floating, changes in interest rates would affect the future cash flows but not the fair value. Assuming the amount of the long-term bank loans at the end of the reporting period had been outstanding for the entire period and all other variables were held constant, a hypothetical 100 basis point (1.00%) increase in interest rates would have resulted in an increase in the interest expense, net of tax, by approximately NT$261 thousand for the year ended December 31, 2016. As of December 31, 2017, the Company had no outstanding long-term bank loans. - 62 - - 62 - The Company classified its investments in fixed income securities as held-to-maturity and available-for-sale financial assets. Because held-to-maturity fixed income securities are measured at amortized cost, changes in interest rates would not affect the fair value. On the other hand, available-for-sale fixed income securities are exposed to fair value fluctuations caused by changes in interest rates. The Company utilized interest rate futures to partially hedge the interest rate risk on its available-for-sale fixed income investments. These hedges may offset only a small portion of the financial impact from movements in interest rates. Based on a sensitivity analysis performed at the end of the reporting period, a hypothetical 100 basis points (1.00%) increase in interest rates across all maturities would have resulted in a decrease in other comprehensive income by NT$2,119,713 thousand and NT$1,600,929 thousand for the years ended December 31, 2017 and 2016, respectively. Other price risk The Company is exposed to equity price risk arising from available-for-sale equity investments. Assuming a hypothetical decrease of 5% in prices of the equity investments at the end of the reporting period for the years ended December 31, 2017 and 2016, the other comprehensive income would have decreased by NT$351,520 thousand and NT$342,565 thousand, respectively. d. Credit risk management Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company is exposed to credit risk from operating activities, primarily trade receivables, and from investing activities, primarily deposits, fixed-income investments and other financial instruments with banks. Credit risk is managed separately for business related and financial related exposures. As of the end of the reporting period, the Company’s maximum credit risk exposure is mainly from the carrying amount of financial assets. Business related credit risk The Company has considerable trade receivables outstanding with its customers worldwide. A substantial majority of the Company’s outstanding trade receivables are not covered by collateral or credit insurance. While the Company has procedures to monitor and limit exposure to credit risk on trade receivables, there can be no assurance such procedures will effectively limit its credit risk and avoid losses. This risk is heightened during periods when economic conditions worsen. As of December 31, 2017 and 2016, the Company’s ten largest customers accounted for 70% and 74% of accounts receivable, respectively. The Company believes the concentration of credit risk is not material for the remaining accounts receivable. Financial credit risk The Company regularly monitors and reviews the concentration limit applied to counterparties and adjusts the concentration limit according to market conditions and the credit standing of the counterparties. The Company mitigates its exposure by limiting the exposure to any individual counterparty and by selecting counterparties with investment-grade credit ratings. e. Liquidity risk management The objective of liquidity risk management is to ensure the Company has sufficient liquidity to fund its business requirements associated with existing operations over the next 12 months. The Company manages liquidity risk by maintaining adequate cash and cash equivalent, short-term available-for-sale financial assets and short-term held-to-maturity financial assets. its - 63 - - 63 - The table below summarizes the maturity profile of the Company’s financial liabilities based on contractual undiscounted payments, including principal and interest. Less Than 1 Year 2-3 Years 4-5 Years 5+ Years Total December 31, 2017 Non-derivative financial liabilities Short-term loans Accounts payable (including related $ 63,801,977 $ parties) Payables to contractors and equipment suppliers Accrued expenses and other current liabilities Bonds payable Guarantee deposits (including those classified under accrued expenses and other current liabilities) Derivative financial instruments Forward exchange contracts Outflows Inflows 30,069,163 55,723,774 24,659,738 60,176,818 $ - - - $ - - - - - - $ 63,801,977 30,069,163 55,723,774 - 68,378,787 - 7,777,715 - 18,203,601 24,659,738 154,536,921 8,493,829 242,925,299 7,503,151 75,881,938 83,639 7,861,354 - 18,203,601 16,080,619 344,872,192 67,393,539 (67,957,919 ) (564,380 ) - - - - - - - - - 67,393,539 (67,957,919 ) (564,380 ) $ 242,360,919 $ 75,881,938 $ 7,861,354 $ 18,203,601 $ 344,307,812 December 31, 2016 Non-derivative financial liabilities Short-term loans Accounts payable (including related $ 57,974,562 $ parties) Payables to contractors and equipment suppliers Accrued expenses and other current liabilities Bonds payable Long-term bank loans Guarantee deposits (including those classified under accrued expenses and other current liabilities) Derivative financial instruments Forward exchange contracts Outflows Inflows Cross currency swap contracts Outflows Inflows 27,324,525 63,154,514 20,713,259 40,669,468 10,543 $ - - - $ - - - - - - $ 57,974,562 27,324,525 63,154,514 - 99,161,486 20,116 - 35,340,742 2,423 - 22,979,426 - 20,713,259 198,151,122 33,082 12,000,189 221,847,060 13,060,483 112,242,085 1,609,950 36,953,115 - 22,979,426 26,670,622 394,021,686 40,571,841 (40,586,344 ) (14,503 ) 5,478,066 (5,487,600 ) (9,534 ) - - - - - - - - - - - - - - - - - - 40,571,841 (40,586,344 ) (14,503 ) 5,478,066 (5,487,600 ) (9,534 ) $ 221,823,023 $ 112,242,085 $ 36,953,115 $ 22,979,426 $ 393,997,649 f. Fair value of financial instruments 1) Fair value measurements recognized in the consolidated balance sheets Fair value measurements are grouped into Levels 1 to 3 based on the degree to which the fair value is observable: (cid:121) Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities; - 64 - - 64 - (cid:121) Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and (cid:121) Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs). 2) Fair value of financial instruments that are measured at fair value on a recurring basis Fair value hierarchy The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis: Level 1 Level 2 Level 3 Total December 31, 2017 Financial assets at FVTPL Held for trading Forward exchange contracts Available-for-sale financial assets Corporate bonds Agency bonds/Agency mortgage-backed securities Asset-backed securities Government bonds Publicly traded stocks Commercial paper Hedging derivative financial assets Fair value hedges $ $ - - $ 569,751 $ $ 40,165,148 $ - - 7,715,980 2,548,054 - 29,235,388 13,459,545 101,743 - 148,295 $ 10,264,034 $ 83,110,119 $ Interest rate futures contracts $ 27,016 $ - $ Cash flow hedges Forward exchange contracts - 7,378 $ 27,016 $ 7,378 $ Financial liabilities at FVTPL Held for trading Forward exchange contracts $ - $ 26,709 $ Hedging derivative financial liabilities Cash flow hedges - - - - - - - - - - - - $ 569,751 $ 40,165,148 29,235,388 13,459,545 7,817,723 2,548,054 148,295 $ 93,374,153 $ 27,016 7,378 $ 34,394 $ 26,709 Forward exchange contracts $ - $ 15,562 $ - $ 15,562 - 65 - - 65 - Level 1 Level 2 Level 3 Total December 31, 2016 Financial assets at FVTPL Held for trading Forward exchange contracts Cross currency swap contracts $ Designated as at FVTPL Time deposit Forward exchange contracts $ $ Available-for-sale financial assets Corporate bonds Agency bonds/Agency mortgage-backed securities Asset-backed securities Government bonds Publicly traded stocks - - - - - - $ 142,406 10,976 $ 6,297,708 22 $ 6,451,112 $ $ 29,999,508 $ - - 8,346,989 3,196,658 14,880,482 11,254,757 110,373 - $ 11,543,647 $ 56,245,120 $ Hedging derivative financial assets Fair value hedges Interest rate futures contracts $ 5,550 $ - $ Financial liabilities at FVTPL Held for trading Forward exchange contracts $ Designated as at FVTPL Forward exchange contracts $ - - - $ 91,585 $ 99,550 $ 191,135 $ - - - - - - - - - - - - - - - $ 142,406 10,976 6,297,708 22 $ 6,451,112 $ 29,999,508 14,880,482 11,254,757 8,457,362 3,196,658 $ 67,788,767 $ 5,550 $ 91,585 99,550 $ 191,135 In the fourth quarter of 2017, the Company reassessed the bid-ask spread and the transaction volume of the fixed income securities in determining whether there were quoted prices in active markets. Accordingly, the Company classified the fair value hierarchy levels of corporate bonds, agency bonds, agency mortgage-backed securities and some government bonds as level 2. To have consistent comparative basis, the Company had revised prior year classification from level 1 to level 2. There were no purchases and disposals for assets classified as Level 3 for the years ended December 31, 2017 and 2016, respectively. Valuation techniques and assumptions used in Level 2 fair value measurement The fair values of financial assets and financial liabilities are determined as follows: (cid:121) The fair values of corporate bonds, agency bonds, agency mortgage-backed securities, asset-backed securities, and government bonds are determined by quoted market prices. (cid:121) Forward exchange contracts and cross currency swap contracts are measured using forward exchange rates and the discounted curves that are derived from quoted market prices. For investments in commercial paper and time deposit designated as FVTPL, the fair values are determined by the present value of future cash flows based on the discounted curves that are derived from the quoted market prices. - 66 - - 66 - 3) Fair value of financial instruments that are not measured at fair value Except as detailed in the following table, the Company considers that the carrying amounts of financial instruments in the consolidated financial statements that are not measured at fair value approximate their fair values. December 31, 2017 December 31, 2016 Carrying Amount Fair Value Carrying Amount Fair Value Financial assets Held-to-maturity financial assets Corporate bonds Structured product Commercial paper Negotiable certificate of deposit Financial liabilities $ 19,338,764 $ 19,541,419 $ 23,849,701 $ 23,996,429 1,609,738 8,630,769 1,475,350 - 1,609,950 8,628,176 1,482,950 - - - 4,829,850 4,847,785 Measured at amortized cost Bonds payable 150,201,122 152,077,728 191,193,557 192,845,296 Fair value hierarchy The table below sets out the fair value hierarchy for the Company’s assets and liabilities which are not required to measure at fair value: Level 1 Level 2 Level 3 Total December 31, 2017 Financial assets Held-to-maturity securities Corporate bonds Structured product Financial liabilities Measured at amortized cost Bonds payable $ $ - - - $ 19,541,419 1,475,350 $ $ 21,016,769 $ - - - $ 19,541,419 1,475,350 $ 21,016,769 $ - $ 152,077,728 $ - $ 152,077,728 Level 1 Level 2 Level 3 Total December 31, 2016 Financial assets Held-to-maturity securities Corporate bonds Commercial paper Negotiable certificate of deposit Structured product $ $ - - - - - $ $ 23,996,429 8,630,769 4,847,785 1,609,738 $ 39,084,721 $ - - - - - $ 23,996,429 8,630,769 4,847,785 1,609,738 $ 39,084,721 Financial liabilities Measured at amortized cost Bonds payable $ - $ 192,845,296 $ - $ 192,845,296 - 67 - - 67 - In the fourth quarter of 2017, the Company reassessed the bid-ask spread and the transaction volume of the fixed income securities in determining whether there were quoted prices in active markets. Accordingly, the Company classified the fair value hierarchy levels of corporate bonds and bonds payable as level 2. To have consistent comparative basis, the Company had revised prior year classification from level 1 to level 2. Valuation techniques and assumptions used in Level 2 fair value measurement The fair values of corporate bonds, negotiable certificate of deposit, and structured products are determined by quoted market prices. The fair value of commercial paper is determined by the present value of future cash flows based on the discounted curves that are derived from the quoted market prices. The fair value of the Company’s bonds payable is determined by quoted market prices. 34. RELATED PARTY TRANSACTIONS Intercompany balances and transactions between TSMC and its subsidiaries, which are related parties of TSMC, have been eliminated upon consolidation; therefore those items are not disclosed in this note. The following is a summary of significant transactions between the Company and other related parties: a. Related party name and categories Related Party Name Related Party Categories GUC VIS SSMC Xintec Mutual-Pak TSMC Education and Culture Foundation TSMC Charity Foundation b. Net revenue Associates Associates Associates Associates Associates Other related parties Other related parties Item Related Party Categories Net revenue from sale of goods Associates Other related parties Years Ended December 31 2017 2016 $ 8,495,937 133 $ 5,929,141 - $ 8,496,070 $ 5,929,141 Net revenue from royalties Associates $ 482,537 $ 516,749 - 68 - - 68 - c. Purchases Related Party Categories Associates d. Receivables from related parties Years Ended December 31 2017 2016 $ 9,904,637 $ 10,108,210 December 31, 2017 December 31, 2016 Item Related Party Name/Categories Receivables from related parties GUC Xintec $ 1,022,892 161,232 $ 969,136 423 $ 1,184,124 $ 969,559 Other receivables from related SSMC $ parties VIS Other Associates $ 83,099 78,141 9,818 60,641 86,038 109 e. Payables to related parties $ 171,058 $ 146,788 December 31, 2017 December 31, 2016 Item Related Party Name/Categories Payables to related parties Xintec VIS SSMC Other Associates f. Others $ $ 817,930 409,950 406,959 21,517 124,541 587,407 506,121 44,105 $ 1,656,356 $ 1,262,174 Years Ended December 31 2017 2016 Item Related Party Categories Manufacturing expenses Associates $ 2,196,141 $ 1,389,164 Research and development Associates $ 69,841 $ 161,735 expenses General and administrative Other related parties $ 101,500 $ 60,000 expenses - 69 - - 69 - The sales prices and payment terms to related parties were not significantly different from those of sales to third parties. For other related party transactions, price and terms were determined in accordance with mutual agreements. The Company leased factory and office from associates. The lease terms and prices were both determined in accordance with mutual agreements. The rental expenses were paid to associates monthly; the related expenses were both classified under manufacturing expenses. The Company deferred the disposal gain/loss derived from sales of property, plant and equipment to related parties (transactions with associates), and then recognized such gain/loss over the depreciable lives of the disposed assets. g. Compensation of key management personnel The compensation to directors and other key management personnel for the years ended December 31, 2017 and 2016 were as follows: Short-term employee benefits Post-employment benefits Years Ended December 31 2017 2016 $ 2,170,280 3,727 $ 2,023,971 3,992 $ 2,174,007 $ 2,027,963 The compensation to directors and other key management personnel were determined by the Compensation Committee of TSMC in accordance with the individual performance and the market trends. 35. PLEDGED ASSETS The Company provided certificate of deposits recorded in other financial assets as collateral mainly for building lease agreements. As of December 31, 2017 and 2016, the aforementioned other financial assets amounted to NT$165,618 thousand and NT$185,698 thousand, respectively. 36. SIGNIFICANT OPERATING LEASE ARRANGEMENTS The Company’s major significant operating leases are arrangements on several parcels of land, machinery and equipment and office premises. The Company expensed the lease payments as follows: Minimum lease payments $ 2,178,054 $ 1,135,735 Years Ended December 31 2017 2016 - 70 - - 70 - Future minimum lease payments under the above non-cancellable operating leases are as follows: Not later than 1 year Later than 1 year and not later than 5 years Later than 5 years December 31, 2017 December 31, 2016 $ 3,116,209 5,174,729 8,905,848 $ 1,321,546 3,677,432 6,623,957 $ 17,196,786 $ 11,622,935 37. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS Significant contingent liabilities and unrecognized commitments of the Company as of the end of the reporting period, excluding those disclosed in other notes, were as follows: a. Under a technical cooperation agreement with Industrial Technology Research Institute, the R.O.C. Government or its designee approved by TSMC can use up to 35% of TSMC’s capacity provided TSMC’s outstanding commitments to its customers are not prejudiced. The term of this agreement is for five years beginning from January 1, 1987 and is automatically renewed for successive periods of five years unless otherwise terminated by either party with one year prior notice. As of December 31, 2017, the R.O.C. Government did not invoke such right. b. Under a Shareholders Agreement entered into with Philips and EDB Investments Pte Ltd. on March 30, 1999, the parties formed a joint venture company, SSMC, which is an integrated circuit foundry in Singapore. TSMC’s equity interest in SSMC was 32%. Nevertheless, in September 2006, Philips spun-off its semiconductor subsidiary which was renamed as NXP B.V. Further, TSMC and NXP B.V. purchased all the SSMC shares owned by EDB Investments Pte Ltd. pro rata according to the Shareholders Agreement on November 15, 2006. After the purchase, TSMC and NXP B.V. currently own approximately 39% and 61% of the SSMC shares, respectively. TSMC and NXP B.V. are required, in the aggregate, to purchase at least 70% of SSMC’s capacity, but TSMC alone is not required to purchase more than 28% of the capacity. If any party defaults on the commitment and the capacity utilization of SSMC falls below a specific percentage of its capacity, the defaulting party is required to compensate SSMC for all related unavoidable costs. There was no default from the aforementioned commitment as of December 31, 2017. c. TSMC joined the Customer Co-Investment Program of ASML and entered into the investment agreement in August 2012. The agreement includes an investment of EUR837,816 thousand by TSMC Global to acquire 5% of ASML’s equity with a lock-up period of 2.5 years. TSMC Global has acquired the aforementioned equity on October 31, 2012. The lock-up period expired on May 1, 2015 and as of October 8, 2015, all ASML shares had been disposed. Both parties also signed the research and development funding agreement whereby TSMC shall provide EUR276,000 thousand to ASML’s research and development programs from 2013 to 2017. As of September 30, 2017, the amount has been fully paid. d. In May 2017, Mr. Uri Cohen filed a complaint in the U.S. District Court for the Eastern District of Texas alleging that TSMC, TSMC North America and other companies infringe four U.S. patents. In response, TSMC and TSMC North America filed a declaratory judgment complaint against Cohen in the U.S. District Court for the Northern District of California seeking a judgment declaring that there is no infringement of the same four patents. TSMC also filed a motion to transfer Cohen’s lawsuit in the U.S. District Court for the Eastern District of Texas to the U.S. District Court for the Northern District of California. Cohen agreed to the transfer, and as of December 2017, the cases are consolidated and pending in the U.S. District Court for the Northern District of California. The outcome cannot be determined and the Company cannot make a reliable estimate of the contingent liability at this time. - 71 - - 71 - e. On September 28, 2017, TSMC was contacted by the European Commission (“Commission”) for information and documents concerning alleged anti-competitive practices of TSMC in relation to semiconductor sales. This proceeding is still in its preliminary stage, and it is premature to predict how the case will proceed, the outcome of the proceeding or its impact. TSMC will continue to cooperate fully with the Commission. f. TSMC entered into long-term purchase agreements of silicon wafer with multiple suppliers. The relative minimum purchase quantity and price are specified in the agreements. g. Amounts available under unused letters of credit as of December 31, 2017 and 2016 were NT$94,909 thousand and NT$122,356 thousand, respectively. 38. SIGNIFICANT LOSS FROM DISASTER On February 6, 2016, an earthquake struck Taiwan. The resulting damage was mostly to inventories and equipment. The Company recognized earthquake losses of NT$2,492,138 thousand, net of insurance claim, for the year ended December 31, 2016. Such losses were primarily included in cost of revenue. The related insurance claim was finalized in the first quarter of 2017, and the accumulated earthquake losses were NT$2,386,824 thousand, net of insurance claim. The Company recognized a reduction of such losses of NT$105,314 thousand for the three months ended March 31, 2017. 39. EXCHANGE RATE INFORMATION OF FOREIGN-CURRENCY FINANCIAL ASSETS AND LIABILITIES The following information was summarized according to the foreign currencies other than the functional currency of the Company. The exchange rates disclosed were used to translate the foreign currencies into the functional currency. The significant financial assets and liabilities denominated in foreign currencies were as follows: Foreign Currencies (In Thousands) Exchange Rate (Note 1) Carrying Amount (In Thousands) December 31, 2017 Financial assets Monetary items USD USD EUR JPY Non-monetary items HKD Financial liabilities Monetary items USD EUR JPY $ 5,668,611 580,555 236,474 34,335,661 6.512 (Note 2) 29.659 35.45 0.2629 $ 168,125,342 17,218,674 8,383,015 9,026,845 285,336 3.80 1,084,276 4,048,384 415,819 43,205,838 29.659 35.45 0.2629 120,071,030 14,740,766 11,358,815 (Continued) - 72 - - 72 - December 31, 2016 Financial assets Monetary items USD EUR JPY Non-monetary items HKD Financial liabilities Monetary items USD EUR JPY Foreign Currencies (In Thousands) Exchange Rate (Note 1) Carrying Amount (In Thousands) $ 5,042,715 19,556 37,024,347 32.199 34.30 0.2775 $ 162,370,381 670,767 10,274,256 257,056 4.15 1,066,780 4,000,930 183,922 61,062,114 32.199 34.30 0.2775 128,825,952 6,308,513 16,944,737 (Concluded) Note 1: Except as otherwise noted, exchange rate represents the number of N.T. dollars for which one foreign currency could be exchanged. Note 2: The exchange rate represents the number of RMB for which one USD dollars could be exchanged. Please refer to the consolidated statements of comprehensive income for the total of realized and unrealized foreign exchange gain and loss for the years ended December 31, 2017 and 2016, respectively. Since there were varieties of foreign currency transactions and functional currencies within the subsidiaries of the Company, the Company was unable to disclose foreign exchange gain (loss) towards each foreign currency with significant impact. 40. OPERATING SEGMENTS INFORMATION a. Operating segments, segment revenue and operating results From 2016, the Company has only one operating segment, the foundry segment. The foundry segment engages mainly in the manufacturing, selling, packaging, testing and computer-aided design of integrated circuits and other semiconductor devices and the manufacturing of masks. The Company uses the income from operations as the measurement for the basis of performance assessment. The basis for such measurement is the same as that for the preparation of financial statements. Please refer to the consolidated statements of comprehensive income for the related segment revenue and operating results. - 73 - - 73 - b. Geographic information Net Revenue from External Customers Years Ended December 31 2016 2017 Non-current Assets December 31, December 31, 2017 2016 Taiwan United States Asia Europe, the Middle East and Africa Others $ 90,129,390 620,948,718 194,477,093 $ 127,062,984 610,371,107 146,907,470 $ 1,027,963,202 7,515,835 44,213,422 $ 991,567,870 8,245,054 14,071,364 68,538,366 3,353,674 58,042,311 5,554,472 8,123 - 8,677 - $ 977,447,241 $ 947,938,344 $ 1,079,700,582 $ 1,013,892,965 The Company categorized the net revenue mainly based on the country in which the customer is headquartered. Non-current assets include property, plant and equipment, intangible assets and other noncurrent assets. c. Production information Production Wafer Others Years Ended December 31 2017 2016 $ 874,572,620 102,874,621 $ 861,170,855 86,767,489 $ 977,447,241 $ 947,938,344 Starting in 2017, revenue from packaging and testing services is reclassified from wafer revenue to other revenue. To have consistent comparative basis, the Company had revised prior year classification. d. Major customers representing at least 10% of net revenue Years Ended December 31 2017 2016 Amount % Amount % Customer A Customer B $ 214,228,766 64,096,227 22 7 $ 157,185,418 107,463,238 17 11 41. ADDITIONAL DISCLOSURES Following are the additional disclosures required by the Securities and Futures Bureau for TSMC: a. Financings provided: Please see Table 1 attached; b. Endorsement/guarantee provided: Please see Table 2 attached; c. Marketable securities held (excluding investments in subsidiaries and associates): Please see Table 3 attached; d. Marketable securities acquired and disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital: Please see Table 4 attached; - 74 - - 74 - e. Acquisition of individual real estate properties at costs of at least NT$300 million or 20% of the paid-in capital: Please see Table 5 attached; f. Disposal of individual real estate properties at prices of at least NT$300 million or 20% of the paid-in capital: None; g. Total purchases from or sales to related parties of at least NT$100 million or 20% of the paid-in capital: Please see Table 6 attached; h. Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital: Please see Table 7 attached; i. Information about the derivative financial instruments transaction: Please see Notes 7 and 10; j. Others: The business relationship between the parent and the subsidiaries and significant transactions between them: Please see Table 8 attached; k. Names, locations, and related information of investees over which TSMC exercises significant influence (excluding information on investment in mainland China): Please see Table 9 attached; l. Information on investment in mainland China 1) The name of the investee in mainland China, the main businesses and products, its issued capital, method of investment, information on inflow or outflow of capital, percentage of ownership, income (losses) of the investee, share of profits/losses of investee, ending balance, amount received as dividends from the investee, and the limitation on investee: Please see Table 10 attached. 2) Significant direct or indirect transactions with the investee, its prices and terms of payment, unrealized gain or loss, and other related information which is helpful to understand the impact of investment in mainland China on financial reports: Please see Table 8 attached. - 75 - - 75 - ) 2 d n a 1 s e t o N ( ) 2 d n a 1 s e t o N ( 1 E L B A T g n i c n a n F i l a t o T s ’ y n a p m o C t n u o m A g n i c n a n F i s t i m L i s t i i m L g n i c n a n F i l a r e t a l l o C h c a E r o f i g n w o r r o B y n a p m o C e u l a V m e t I t b e D ) 4 e t o N ( d a B r o f e c n a w o l l A g n i i c n a n F r o f n o s a e R n o i t c a s n a r T s t n u o m A g n i c n a n i F r o f e r u t a N ) 4 e t o N ( e t a R t s e r e t n I y l l a u t c A t n u o m A e c n a l a B g n i d n E n w a r D n g i e r o F ( n i s e i c n e r r u C ) s d n a s u o h T n g i e r o F ( n i s e i c n e r r u C ) s d n a s u o h T ) 3 e t o N ( m u m i x a M e h t r o f e c n a l a B n g i e r o F ( d o i r e P n i s e i c n e r r u C ) s d n a s u o h T ) 3 e t o N ( d e t a l e R y t r a P t n e m e t a t S l a i c n a n i F t n u o c c A y t r a p - r e t n u o C g n i c n a n i F y n a p m o C . o N ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F s e i r a i d i s b u S d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T D E D I V O R P S G N I C N A N I F 7 7 8 , 1 1 2 , 9 0 3 7 7 8 , 1 1 2 , 9 0 3 5 1 8 , 1 6 1 , 1 5 $ 5 1 8 , 1 6 1 , 1 5 $ - - $ - - - - $ l a t i p a c g n i t a r e p O l a t i p a c g n i t a r e p O - - $ / m r e t - t r o h s r o f d e e n e h T % 5 . 1 - % 3 . 1 0 0 8 , 9 3 0 , 0 2 $ 0 0 7 , 0 5 9 , 0 2 $ 0 0 7 , 0 5 9 , 0 2 $ g n i c n a n i f m r e t - g n o l ) 0 0 0 , 0 0 4 , 4 B M R ( ) 0 0 0 , 0 0 6 , 4 B M R ( ) 0 0 0 , 0 0 6 , 4 B M R ( g n i c n a n i f m r e t - t r o h s r o f d e e n e h T % 5 4 . 1 - % 8 0 . 1 - 0 0 5 , 8 8 4 , 4 4 0 0 5 , 8 8 4 , 4 4 ) 0 0 0 , 0 0 5 , 1 $ S U ( ) 0 0 0 , 0 0 5 , 1 $ S U ( s e Y s e Y s e i t r a p d e t a l e r m o r f s e l b a v i e c e r r e h t O g n i j n a N C M S T a n i h C C M S T s e i t r a p d e t a l e r m o r f s e l b a v i e c e r r e h t O C M S T l a b o l G C M S T 1 2 n a h t e r o m o n e b l l a h s r e w o r r o b e n o y n a o t e l b a d n e l t n u o m a l a t o t e h t , n o i t i d d a n I . a n i h C C M S T f o h t r o w t e n e h t f o ) % 0 1 ( t n e c r e p n e t d e e c x e t o n l l a h s d o i r e p m r e t - t r o h s a r o f g n i d n u f r o f y n a p m o c a o t g n i d n e l r o f t n u o m a l a t o t e h T . a n i h C C M S T f o h t r o w t e n e h t d e e c x e t o n l l a h s e s o p r u p g n i d n e l r o f e l b a l i a v a t n u o m a l a t o t e h T n e h W . a n i h C C M S T f o h t r o w t e n e h t f o ) % 0 4 ( t n e c r e p y t r o f d e e c x e t o n l l a h s C M S T f o y r a i d i s b u s h c u s y n a o t e l b a d n e l t n u o m a l a t o t e h t , r e v e w o H . C M S T y b , y l t c e r i d n i r o y l t c e r i d , d e n w o % 0 0 1 e r a s e r a h s g n i t o v e s o h w s e i r a i d i s b u s e h t o t y l p p a t o n s e o d n o i t c i r t s e r e v o b a e h T . h t r o w t e n s ’ r e w o r r o b e h t f o ) % 0 3 ( t n e c r e p y t r i h t e h t , g n i o g e r o f e h t g n i d n a t s h t i w t o N . e l c i t r A s i h t f o h p a r g a r a p e v o b a e h t n i h t r o f t e s n o i t c i r t s e r e h t o t t c e j b u s e b t o n l l i w g n i d n e l e h t , n a w i a T n i d e t a c o l t o n e r a h c i h w , C M S T y b , y l t c e r i d n i r o y l t c e r i d , d e n w o % 0 0 1 e r a s e r a h s g n i t o v e s o h w s e i r a i d i s b u s e h t o t r o , C M S T o t a n i h C C M S T y b s d e e n g n i d n u f r o f g n i d n e l a s i e r e h t . a n i h C C M S T f o h t r o w t e n e h t d e e c x e t o n l l a h s l l i t s s r e w o r r o b h c u s f o h c a e o t e l b a d n e l t n u o m a l a t o t e h t d n a s r e w o r r o b h c u s o t g n i d n e l r o f e l b a l i a v a t n u o m a e t a g e r g g a n a h t e r o m o n e b l l a h s r e w o r r o b e n o y n a o t e l b a d n e l t n u o m a l a t o t e h t , n o i t i d d a n I . l a b o l G C M S T f o h t r o w t e n e h t f o ) % 0 1 ( t n e c r e p n e t d e e c x e t o n l l a h s d o i r e p m r e t - t r o h s a r o f g n i d n u f r o f y n a p m o c a o t g n i d n e l r o f t n u o m a l a t o t e h T . l a b o l G C M S T f o h t r o w t e n e h t d e e c x e t o n l l a h s e s o p r u p g n i d n e l r o f e l b a l i a v a t n u o m a l a t o t e h T e t a g e r g g a e h t , g n i o g e r o f e h t g n i d n a t s h t i w t o N . l a b o l G C M S T f o h t r o w t e n e h t d e e c x e t o n l l a h s l l i t s t n u o m a g n i w o r r o b l a t o t r i e h t , n o i t c i r t s e r s i h t o t t c e j b u s e b t o n l l i w C M S T y b , y l t c e r i d n i r o y l t c e r i d , d e n w o % 0 0 1 e r a s e r a h s g n i t o v e s o h w s e i r a i d i s b u s n g i e r o f r o , C M S T e l i h W . h t r o w t e n s ’ r e w o r r o b e h t f o ) % 0 3 ( t n e c r e p y t r i h t . s e r a h s g n i t o v e h t f o % 0 0 1 , y l t c e r i d n i r o y l t c e r i d , s d l o h y n a p m o C e h t h c i h w n i s e i r a i d i s b u s e r o h s f f o n e e w t e b g n i d n u f r o f s n a o l y n a p m o c - r e t n i o t y l p p a t o n l l a h s r a e y e n o g n i d e e c x e t o n g n i d n u f r o f n a o l h c a e f o m r e t e h t f o n o i t c i r t s e r e h T . l a b o l G C M S T f o h t r o w t e n e h t f o ) % 0 4 ( t n e c r e p y t r o f d e e c x e t o n l l a h s C M S T n a h t r e h t o s e i n a p m o c n a w i a T o t g n i d n e l r o f t n u o m a . s r o t c e r i D f o d r a o B e h t y b d e v o r p p a s t n u o m a e h t t n e s e r p e r e c n a l a b g n i d n e d n a d o i r e p e h t r o f e c n a l a b m u m i x a m e h T : 1 e t o N : 2 e t o N : 3 e t o N : 4 e t o N - - 6 6 7 7 - - 2 E L B A T e e t n a r a u G o t d e d i v o r P s e i r a i d i s b u S d n a l n i a M n i a n i h C e e t n a r a u G y b d e d i v o r P y r a i d i s b u S A e e t n a r a u G y b d e d i v o r P t n e r a P y n a p m o C m u m i x a M / t n e m e s r o d n E e e t n a r a u G t n u o m A e l b a w o l l A ) 2 e t o N ( s t n e m e t a t S f o o i t a R d e t a l u m u c c A / t n e m e s r o d n E f o t n u o m A / t n e m e s r o d n E t e N o t e e t n a r a u G e e t n a r a u G l a i c n a n i F t s e t a L s e i t r e p o r P r e p y t i u q E y b d e z i l a r e t a l l o C y l l a u t c A t n u o m A e c n a l a B g n i d n E n w a r D n i $ S U ( ) s d n a s u o h T n i $ S U ( ) s d n a s u o h T ) 3 e t o N ( s e i r a i d i s b u S d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( D E D I V O R P S E E T N A R A U G / S T N E M E S R O D N E 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F m u m i x a M e c n a l a B d o i r e P e h t r o f / t n e m e s r o d n E e e t n a r a u G t n u o m A n i $ S U ( h c a E o t d e d i v o r P ) s d n a s u o h T ) 3 e t o N ( d e e t n a r a u G y t r a P ) 2 d n a 1 s e t o N ( n o s t i m L i y t r a P d e e t n a r a u G f o e r u t a N p i h s n o i t a l e R e m a N r e d i v o r P e e t n a r a u G / t n e m e s r o d n E . o N o N o N o N o N s e Y s e Y 3 8 3 , 4 1 5 , 0 8 3 3 8 3 , 4 1 5 , 0 8 3 $ % 4 2 . 2 % 6 1 . 0 - - ) 0 0 0 , 0 5 1 , 1 $ S U ( ) 0 0 0 , 0 5 1 , 1 $ S U ( ) 0 0 0 , 0 5 1 , 1 $ S U ( ) 3 1 2 , 3 8 $ S U ( ) 3 1 2 , 3 8 $ S U ( ) 3 1 2 , 3 8 $ S U ( a c i r e m A 3 2 0 , 8 6 4 , 2 3 2 0 , 8 6 4 , 2 3 2 0 , 8 6 4 , 2 3 8 3 , 4 1 5 , 0 8 3 y r a i d i s b u S h t r o N C M S T $ 0 5 8 , 7 0 1 , 4 3 $ 0 5 8 , 7 0 1 , 4 3 $ 0 5 8 , 7 0 1 , 4 3 $ 3 8 3 , 4 1 5 , 0 8 3 $ y r a i d i s b u S l a b o l G C M S T C M S T 0 , d e n w o % 0 0 1 e r a s e r a h s g n i t o v e s o h w s e i r a i d i s b u s , r e v e w o H . y t i t n e h c u s f o h t r o w t e n e h t r o , h t r o w t e n s ’ C M S T f o ) % 0 1 ( t n e c r e p n e t d e e c x e t o n l l a h s y t i t n e l a u d i v i d n i y n a o t C M S T y b d e d i v o r p e e t n a r a u g e h t f o t n u o m a l a t o t e h T . s r o t c e r i D f o d r a o B e h t f o l a v o r p p a e h t r e t f a s n o i t c i r t s e r e v o b a e h t o t t c e j b u s t o n e r a C M S T y b , y l t c e r i d n i r o y l t c e r i d : 1 e t o N . s r o t c e r i D f o d r a o B e h t y b d e v o r p p a s t n u o m a e h t t n e s e r p e r e c n a l a b g n i d n e d n a d o i r e p e h t r o f e c n a l a b m u m i x a m e h T : 3 . h t r o w t e n s ’ C M S T f o ) % 5 2 ( t n e c r e p e v i f - y t n e w t d e e c x e t o n l l a h s e e t n a r a u g f o t n u o m a l a t o t e h T : 2 e t o N e t o N - - 7 7 7 7 - - 3 E L B A T e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( D L E H S E I T I R U C E S E L B A T E K R A M 7 1 0 2 , 1 3 R E B M E C E D s e i r a i d i s b u S d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T ) d e u n i t n o C ( 9 7 2 , 9 0 3 , 1 , 6 7 2 4 8 0 , 1 4 8 5 3 9 1 , 0 0 0 5 0 1 , 1 4 0 , 4 1 4 0 9 9 , 5 7 9 , 6 0 1 4 , 6 $ - 0 0 0 5 6 , $ S U 7 0 6 , 8 0 7 2 , 4 5 1 1 3 4 , 3 0 7 2 4 , 1 0 1 0 4 , 5 6 4 8 3 , 1 1 9 9 2 , 7 6 8 6 2 , 3 3 5 8 1 , 8 9 2 8 1 , 4 2 0 7 1 , 3 6 4 6 1 , 2 1 4 4 1 , 3 2 6 3 1 , 6 0 4 3 1 , 4 1 2 2 1 , 5 1 0 2 1 , 7 9 0 1 1 , 3 7 0 1 1 , 1 9 7 0 1 , 5 6 4 0 1 , 4 6 4 0 1 , 3 8 3 0 1 , 4 6 2 0 1 , 8 1 0 0 1 , 8 6 8 , 9 2 6 8 , 9 0 2 6 , 9 0 1 4 , 9 6 9 3 , 9 1 0 3 , 9 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 2 1 - 0 1 7 6 2 1 2 1 5 2 2 1 9 6 A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / , 9 7 2 9 0 3 , 1 , 6 7 2 4 8 0 , 1 4 8 5 3 9 1 , 0 0 0 5 0 1 , 1 4 0 , 4 1 4 0 9 9 , 5 7 9 , 6 0 1 4 , 6 $ 0 2 3 8 5 , 5 0 1 1 2 , 0 3 2 1 2 , 0 0 5 0 1 , 4 2 1 1 1 , 2 5 1 , 1 - - " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A " t s o c t a d e i r r a c s t e s s a l a i c n a n i F " t s o c t a d e i r r a c s t e s s a l a i c n a n i F - 0 0 0 5 6 , $ S U 3 3 3 , 6 0 4 4 0 1 , " t s o c t a d e i r r a c s t e s s a l a i c n a n i F 7 0 6 , 8 0 7 2 , 4 5 1 1 3 4 , 3 0 7 2 4 , 1 0 1 0 4 , 5 6 4 8 3 , 1 1 9 9 2 , 7 6 8 6 2 , 3 3 5 8 1 , 8 9 2 8 1 , 4 2 0 7 1 , 3 6 4 6 1 , 2 1 4 4 1 , 3 2 6 3 1 , 6 0 4 3 1 , 4 1 2 2 1 , 5 1 0 2 1 , 7 9 0 1 1 , 3 7 0 1 1 , 1 9 7 0 1 , 5 6 4 0 1 , 4 6 4 0 1 , 3 8 3 0 1 , 4 6 2 0 1 , 8 1 0 0 1 , 8 6 8 , 9 2 6 8 , 9 0 2 6 , 9 0 1 4 , 9 6 9 3 , 9 1 0 3 , 9 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " t s o c t a d e i r r a c s t e s s a l a i c n a n i F s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A " " " " " " " " " " " " " " " " " " " " " " " " " " " " - - 8 8 7 7 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - n o i t a r o p r o C l a n o i t a n r e t n I g n i r u t c a f u n a M r o t c u d n o c i m e S . d t L , . o C n a w i a T i a t o d n a H u s t E - n i h S . d t L , . o C s e s a G l a i r t s u d n I d e t i n U . c n I g n i d l o H t n e m t s e v n I l a b o l G k c o t s n o m m o C h c e t o M C M S T V I d n u F y g o l o n h c e T . . K W . . P L , I I s t n e m t s e v n I e r u t n e V n e d l a W a n i h C d n u F s e r u t n e V n o z i r o H l a t i p a C a i s A n o s m i r C d n u F s n o i t a v o n n I a l e T k c o t s n o m m o C . c n I e b u c M d n u F e s i r p r e t n E l a t i p a C e r u t n e V n e d l a W i a h g n a h S e h T / c n I p u o r G s h c a S n a m d l o G c n I s n o i t a c i n u m m o C n o z i r e V C L L o C t i d e r C r o t o M d r o F c n I p u o r g i t i C c n I T & T A p r o C a c i r e m A f o k n a B o C & e s a h C n a g r o M P J d n o b e t a r o p r o C y e l n a t S n a g r o M p r o C l a t i p a C T A B A N k n a B C N P c n I e l p p A c n I e c n a n i F v e B n I h c s u B - r e s u e h n A / Y N k r o Y w e N G A e s s i u S t i d e r C c n I s d o o F n o s y T e h T / o C n r e h t u o S c n I e i V b b A c n I p u o r G l a i c n a n i F J F U i h s i b u s t i M k n a B t n e m p o l e v e D n a i s A c n I p u o r G l a i c n a n i F i u s t i M o m o t i m u S c n I p u o r G l a n o i t a n r e t n I n a c i r e m A B A n e k n a b s l e d n a H a k s n e v S p r o C p u o r G l a t i p a C n o i t a i v A p r o C t f o s o r c i M p r o C g n i k n a B c a p t s e W c n I h t l a e H l a n i d r a C C L P s t e k r a M l a t i p a C P B p r o C h t l a e H S V C o C & o g r a F s l l e W A V n a e l c / M A N e n O l a t i p a C s r e n t r a P C M S T l a b o l G C M S T ) d e u n i t n o C ( - - 9 9 7 7 - - e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 9 9 0 , 9 9 5 7 , 8 6 2 6 , 8 4 0 6 , 8 6 0 5 , 8 7 3 3 , 8 1 4 0 , 8 2 9 9 , 7 3 7 8 , 7 4 9 7 , 7 5 0 5 , 7 3 5 3 , 7 7 2 3 , 7 2 5 2 , 7 0 0 1 , 7 3 7 0 , 7 2 7 0 , 7 0 1 0 , 7 4 9 9 , 6 1 7 9 , 6 1 7 9 , 6 0 0 9 , 6 2 8 8 , 6 6 6 8 , 6 6 2 7 , 6 3 4 5 , 6 1 3 5 , 6 4 8 4 , 6 3 8 4 , 6 7 4 3 , 6 6 3 3 , 6 6 0 3 , 6 1 0 3 , 6 9 1 2 , 6 1 8 1 , 6 0 8 1 , 6 8 3 9 , 5 5 2 9 , 5 1 0 9 , 5 8 5 8 , 5 7 4 8 , 5 9 6 7 , 5 8 6 7 , 5 3 2 7 , 5 5 7 6 , 5 3 4 6 , 5 5 0 6 , 5 1 7 5 , 5 6 3 5 , 5 7 9 2 , 5 9 5 2 , 5 3 4 2 , 5 5 4 1 , 5 9 8 0 , 5 5 6 0 , 5 3 4 0 , 5 2 3 0 , 5 5 0 0 , 5 0 0 0 , 5 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 9 9 0 , 9 9 5 7 , 8 6 2 6 , 8 4 0 6 , 8 6 0 5 , 8 7 3 3 , 8 1 4 0 , 8 2 9 9 , 7 3 7 8 , 7 4 9 7 , 7 5 0 5 , 7 3 5 3 , 7 7 2 3 , 7 2 5 2 , 7 0 0 1 , 7 3 7 0 , 7 2 7 0 , 7 0 1 0 , 7 4 9 9 , 6 1 7 9 , 6 1 7 9 , 6 0 0 9 , 6 2 8 8 , 6 6 6 8 , 6 6 2 7 , 6 3 4 5 , 6 1 3 5 , 6 4 8 4 , 6 3 8 4 , 6 7 4 3 , 6 6 3 3 , 6 6 0 3 , 6 1 0 3 , 6 9 1 2 , 6 1 8 1 , 6 0 8 1 , 6 8 3 9 , 5 5 2 9 , 5 1 0 9 , 5 8 5 8 , 5 7 4 8 , 5 9 6 7 , 5 8 6 7 , 5 3 2 7 , 5 5 7 6 , 5 3 4 6 , 5 5 0 6 , 5 1 7 5 , 5 6 3 5 , 5 7 9 2 , 5 9 5 2 , 5 3 4 2 , 5 5 4 1 , 5 9 8 0 , 5 5 6 0 , 5 3 4 0 , 5 2 3 0 , 5 5 0 0 , 5 0 0 0 , 5 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - I I g n i d n u F l a b o l G e f i L d r a d n a t S e c n a i l e R B A n e k n a B a d l i k s n E a k s i v a n i d n a k S c n I p u o r G l a i c n a n i F o h u z i M p r o c n a B d r i h T h t f i F e h T / p r o C n o l l e M k r o Y w e N f o k n a B C L P s g n i d l o H p u o r G K U r e d n a t n a S c n I r e w o t l l e W p r o C n a m m u r G p o r h t r o N p r o C e n e g l e C C A D e c n a n i F l a t i p a C n o i t a i v A C B M S o C t s u r T s r e d a r T & s r e r u t c a f u n a M e h T / o C l a c i m e h C w o D A S r e d n a t n a S o c n a B c n I s g n i d l o H l a t i p a C y g r e n E a r E t x e N p r o C s g n i d l o H r e g r e b m u l h c S d t L s g n i d l o H e c n a r u s n I n e p s A p r o C t i d e r C r o t o M a t o y o T C L P K U r e d n a t n a S A S e n o n a D / n o d n o L G A S B U p r o C y e K p r o C e c n a n i F L T P / p L o C g n i s a e L k c u r T e k s n e P g n i d n u F l a b o l G e f i L l a n o i t a N n o s k c a J o C t s u r T & g n i k n a B h c n a r B H O d n a l e v e l C A N k n a B y e K / p r o C e c n a n i F l a n o i t a n r e t n I T C d r o f m a t S / G A S B U c n I s n i l l o C l l e w k c o R p r o C a n g i C d t L s g n i d l o H e R r e i l e p t n o M D M / c n I o C & k c i m r o C c M c n I n e g m A p r o C s g n i d l o H C T I B A k n a B a e d r o N I R e c n e d i v o r P / A N k n a B s n e z i t i C t n e m p o l e v e D & n o i t c u r t s n o c e R r o f k n a B l a n o i t a n r e t n I p r o C l a t i p a C s a t n e V / P L y t l a e R s a t n e V o C e s i r p r e t n E d r a k c a P t t e l w e H C L L a c i r e m A h t r o N e c n a n i F r e l m i a D p r o C y g r e n E e k u D C L L e c n a n i F A S U C A R E c n I y g r e n E n o i n i m o D C L P s g n i d l o H C B S H V B e c n a n i F l a n o i t a n r e t n I m o k e l e T e h c s t u e D V N j i p p a h c s t a a m s g n i r e i c n a n i F s n e m e i S A S l e u t u M t i d e r C u d e v i t a r e d e F e u q n a B C L P s e c i v r e S y r u s a e r T r e s i k c n e B t t i k c e R V N k n a B O R M A N B A G A d n a l r e z t i w S g n i d n u F p u o r G S B U n o d n o L / d t L l ' t n I d n a l a e Z w e N Z N A e h T / k n a B n o i n i m o D - o t n o r o T e h T / k n a B l a n o i t a N n o t g n i t n u H p r o C e l c a r O D M / c n I l a n o i t a n r e t n I t t o i r r a M c n I a c i r e m A x o F y r u t n e C t s 1 2 a c i r e m A l a t i p a C i a d n u y H p r o C e s a e L r i A c n I M M O C L A U Q C L P s y a l c r a B l a b o l G C M S T ) d e u n i t n o C ( - - 0 0 8 8 - - e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 8 4 9 , 4 5 3 9 , 4 7 1 9 , 4 8 0 9 , 4 9 1 8 , 4 2 8 7 , 4 0 4 7 , 4 5 3 7 , 4 4 2 7 , 4 9 8 6 , 4 9 5 6 , 4 2 4 6 , 4 7 8 5 , 4 3 8 5 , 4 2 7 4 , 4 6 4 4 , 4 1 9 3 , 4 7 6 3 , 4 8 0 2 , 4 9 1 1 , 4 8 9 0 , 4 0 9 9 , 3 2 8 9 , 3 1 6 9 , 3 9 3 9 , 3 1 1 9 , 3 8 8 8 , 3 4 6 8 , 3 5 2 8 , 3 7 8 7 , 3 8 3 7 , 3 6 3 7 , 3 3 6 6 , 3 9 0 6 , 3 7 8 5 , 3 4 7 5 , 3 8 6 5 , 3 1 2 5 , 3 5 1 5 , 3 1 8 4 , 3 0 6 3 , 3 5 5 3 , 3 5 2 2 , 3 2 2 1 , 3 5 1 1 , 3 0 2 0 , 3 2 1 0 , 3 5 9 9 , 2 0 9 9 , 2 4 2 9 , 2 2 8 8 , 2 5 6 8 , 2 7 7 7 , 2 9 1 7 , 2 3 9 6 , 2 9 8 6 , 2 7 5 6 , 2 9 8 5 , 2 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 8 4 9 , 4 5 3 9 , 4 7 1 9 , 4 8 0 9 , 4 9 1 8 , 4 2 8 7 , 4 0 4 7 , 4 5 3 7 , 4 4 2 7 , 4 9 8 6 , 4 9 5 6 , 4 2 4 6 , 4 7 8 5 , 4 3 8 5 , 4 2 7 4 , 4 6 4 4 , 4 1 9 3 , 4 7 6 3 , 4 8 0 2 , 4 9 1 1 , 4 8 9 0 , 4 0 9 9 , 3 2 8 9 , 3 1 6 9 , 3 9 3 9 , 3 1 1 9 , 3 8 8 8 , 3 4 6 8 , 3 5 2 8 , 3 7 8 7 , 3 8 3 7 , 3 6 3 7 , 3 3 6 6 , 3 9 0 6 , 3 7 8 5 , 3 4 7 5 , 3 8 6 5 , 3 1 2 5 , 3 5 1 5 , 3 1 8 4 , 3 0 6 3 , 3 5 5 3 , 3 5 2 2 , 3 2 2 1 , 3 5 1 1 , 3 0 2 0 , 3 2 1 0 , 3 5 9 9 , 2 0 9 9 , 2 4 2 9 , 2 2 8 8 , 2 5 6 8 , 2 7 7 7 , 2 9 1 7 , 2 3 9 6 , 2 9 8 6 , 2 7 5 6 , 2 9 8 5 , 2 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - t s u r T s e i t r e p o r P w e i v r i a F c a l l i d a C ' s r e h c a e T o i r a t n O V B s d n a l r e h t e N s g n i d l o H l a n o i t a n r e t n I z e l e d n o M C L L g n i t a r e p O s t c u d o r P e s i r p r e t n E C L L o C n o i t a r e n e G n o l e x E g n i d n u F l a b o l G e f i L k r o Y w e N H O / i t a n n i c n i C A N k n a B S U a d a n a C f o k n a B l a y o R C L P k n a B s d y o l L p r o C l e t n I c n I s k n a B t s u r T n u S p r o C h c r a e s e R m a L c n I m e t s y S r e d y R c n I s a x e T P E A p r o C t i d e r C s s e r p x E n a c i r e m A t s u r T g n i d n u F s r e n r o C e v i F A S e c n a n i F e d i u q i L r i A V B e c n a n i F l a n o i t a n r e t n I l l e h S c n I s n o i t a c i n u m m o C x o C d t L p u o r G e i r a u q c a M k n a B t n e m t s e v n I n a e p o r u E A N k n a b i t i C c n I s e c i v e D g o l a n A p r o c n a B S U e c r e m m o C f o k n a B l a i r e p m I n a i d a n a C c n I d r a T - e h c u o C n o i t a t n e m i l A / n o d n o L A S e l o c i r g A t i d e r C g n i d n u F l a b o l G e f i L e v i t c e t o r P o C c i r t c e l E & s a G c i f i c a P C L L e c n a n i F n e e v u N P G s g n i d l o H s a c i r e m A L A B O L G S E S V N s e i r t s u d n I l l e s a B l l e d n o y L c n I e g n a h c x E l a t n e n i t n o c r e t n I o C g n i d l o H s t p i r c S s s e r p x E A N k n a B o g r a F s l l e W l a n o i t a n r e t n I n o s i d E p r o C T & B B a i t o c S a v o N f o k n a B d t L y a w t e M - p r o c n u S c n I y g r e n E y k s u H t n i r p S / C L L I I o C m u r t c e p S t n i r p S / C L L o C m u r t c e p S t n i r p S t s u r T h g u o r h T s s a P A s s a l C 1 - 7 0 0 2 s e n i L r i A a t l e D c n I e d i w d l r o W v e B n I h c s u B - r e s u e h n A V N l a n o i t a n r e t n I e c n a n i F l e n E d t L k n a B e i r a u q c a M c n I r e n r a W e m T i c n I m e h t n A c n I a n t e A H O i t a n n i c n i C / k n a B d r i h T h t f i F C L L B e c n a n i F e R r e n t r a P p r o C e c n a n i F e c r u o S i N C L P p u o r G g n i k n a B s d y o l L C L L l a t i p a C S U W M B c n I e n o Z o t u A C L L I I I o C m u r t c e p S P L t s u r T y t l a e R l a t i g i D o C y g o l o n h c e T C X D A S s a b i r a P P N B p r o C t e e r t S e t a t S e h T / o C r e g o r K l a b o l G C M S T ) d e u n i t n o C ( - - 1 1 8 8 - - e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 6 5 5 , 2 9 1 5 , 2 1 0 5 , 2 0 9 4 , 2 9 8 4 , 2 5 8 4 , 2 9 3 4 , 2 6 2 4 , 2 7 3 3 , 2 1 3 3 , 2 7 1 3 , 2 1 0 3 , 2 0 0 3 , 2 9 8 2 , 2 0 8 2 , 2 1 4 2 , 2 7 2 2 , 2 8 1 2 , 2 6 0 2 , 2 0 5 1 , 2 6 3 1 , 2 0 3 1 , 2 3 1 1 , 2 5 0 0 , 2 2 0 0 , 2 1 0 0 , 2 2 6 9 , 1 0 6 9 , 1 4 5 9 , 1 7 4 9 , 1 4 2 9 , 1 0 2 9 , 1 3 1 9 , 1 8 0 9 , 1 6 3 8 , 1 2 3 8 , 1 1 3 8 , 1 9 0 8 , 1 4 9 7 , 1 1 9 7 , 1 5 7 7 , 1 3 7 7 , 1 2 6 7 , 1 1 6 7 , 1 8 5 7 , 1 1 5 7 , 1 1 4 7 , 1 8 0 7 , 1 1 9 6 , 1 9 2 6 , 1 6 2 6 , 1 8 0 6 , 1 2 0 6 , 1 4 9 5 , 1 8 8 5 , 1 6 3 5 , 1 2 3 5 , 1 7 2 5 , 1 0 1 5 , 1 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 6 5 5 , 2 9 1 5 , 2 1 0 5 , 2 0 9 4 , 2 9 8 4 , 2 5 8 4 , 2 9 3 4 , 2 6 2 4 , 2 7 3 3 , 2 1 3 3 , 2 7 1 3 , 2 1 0 3 , 2 0 0 3 , 2 9 8 2 , 2 0 8 2 , 2 1 4 2 , 2 7 2 2 , 2 8 1 2 , 2 6 0 2 , 2 0 5 1 , 2 6 3 1 , 2 0 3 1 , 2 3 1 1 , 2 5 0 0 , 2 2 0 0 , 2 1 0 0 , 2 2 6 9 , 1 0 6 9 , 1 4 5 9 , 1 7 4 9 , 1 4 2 9 , 1 0 2 9 , 1 3 1 9 , 1 8 0 9 , 1 6 3 8 , 1 2 3 8 , 1 1 3 8 , 1 9 0 8 , 1 4 9 7 , 1 1 9 7 , 1 5 7 7 , 1 3 7 7 , 1 2 6 7 , 1 1 6 7 , 1 8 5 7 , 1 1 5 7 , 1 1 4 7 , 1 8 0 7 , 1 1 9 6 , 1 9 2 6 , 1 6 2 6 , 1 8 0 6 , 1 2 0 6 , 1 4 9 5 , 1 8 8 5 , 1 6 3 5 , 1 2 3 5 , 1 7 2 5 , 1 0 1 5 , 1 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - d t L y e s n r e u G g n i d n u F p u o r G e s s i u S t i d e r C I g n i d n u F l a b o l G e f i L n a t i l o p o r t e M p r o C l a i c n a n i F e n O l a t i p a C k r o Y w e N / d t L k n a B a i l a r t s u A l a n o i t a N e h T / d t L J F U i h s i b u s t i M - o y k o T f o k n a B P L p u o r G y t r e p o r P n o m i S k n a B t n e m p o l e v e D n a c i r e m A r e t n I c n I l a i c n a n i F a y o V p r o C y t l a e R o c m K i V N p e o r G G N I o C & s r u o m e N e d t n o P u d I E C L L a i d e M l a s r e v i n U C B N c n I p u o r G h t l a e H d e t i n U o C l a c i m e h C n a m t s a E o C r J y e l g i r W m W Y N / c n I m e l y X I g n i d n u F l a b o l G a o c i r P 2 o N p r o C s a t n i C p r o C e c n a r u s s A o r P p r o C y e l k r e B R W l a e r t n o M f o k n a B p r o C o c s y S c n I P C H t s u r T h g u o r h T s s a P A s s a l C 2 - 3 1 0 2 s e n i l r i A n a c i r e m A C L P s n o i t a c i n u m m o c e l e T h s i t i r B c l p l a n o i t a n r e t n I s l o r t n o C n o s n h o J S / A k n a B e k s n a D P L s r e n t r a P m a e r t s d i M n a l l e g a M / e h T C L L s o C s n r a e t S r a e B A G a t n a l t A / k n a B t s u r T n u S A S e l a r e n e G e t e i c o S o C T K R k c o R t s e W A S e g n a r O c n I l a n o i t a n r e t n I s i r r o M p i l i h P P L y t l a e R e k u D p r o C r e k y r t S A S E C P B Y N k r o Y w e N / d t L p u o r G g n i k n a B d n a l a e Z w e N & a i l a r t s u A Y N k r o Y w e N / a i l a r t s u A f o k n a B h t l a e w n o m m o C d t L t n e m t s e v n I s a e s r e v O d i r G e t a t S c n I A S U s e l b m a r B c n I a s i V C L L s g n i d l o H s a G y g r e n E n o i n i m o D p r o C s e i g o l o n h c e T d e t i n U P L s r e t n e C y c n e g e R d t L k n a B t s u r T i u s t i M o m o t i m u S p r o C g n i k n a B i u s t i M o m o t i m u S p r o C l a i c n a n i F s n o i g e R C L L e c n a n i F a r r e t l A c n I s e c n e i c S d a e l i G o C r e s u e a h r e y e W c n I m o c . n o z a m A p r o C s e c i v r e S l a i c n a n i F r a l l i p r e t a C C L P e c n a n i F l a n o i t a n r e t n I T A B I I g n i d n u F l a b o l G e f i L l a p i c n i r P c n I e v i t o m o t u A y l l i e R O ' C L L r e w o P G E S P p r o C n o r v e h C p r o C e m o c n I y t l a e R l a b o l G C M S T e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 0 0 5 , 1 8 9 4 , 1 7 9 4 , 1 5 9 4 , 1 0 7 4 , 1 9 6 4 , 1 9 5 4 , 1 0 5 4 , 1 4 4 4 , 1 9 2 4 , 1 8 0 4 , 1 1 0 4 , 1 7 8 3 , 1 6 6 3 , 1 4 8 2 , 1 7 7 2 , 1 3 7 2 , 1 6 6 2 , 1 1 6 2 , 1 6 5 2 , 1 3 1 2 , 1 6 0 2 , 1 9 7 1 , 1 6 3 1 , 1 4 3 1 , 1 8 1 1 , 1 5 9 0 , 1 5 8 0 , 1 5 7 0 , 1 7 6 0 , 1 4 6 0 , 1 4 6 0 , 1 0 5 0 , 1 9 4 0 , 1 2 4 0 , 1 7 3 0 , 1 2 3 0 , 1 9 2 0 , 1 6 1 0 , 1 3 1 0 , 1 9 0 0 , 1 7 0 0 , 1 6 0 0 , 1 4 0 0 , 1 2 0 0 , 1 0 0 0 , 1 9 9 9 8 9 9 7 9 9 2 9 9 2 9 9 8 8 9 6 7 9 5 6 9 2 3 9 9 2 9 7 1 9 5 0 9 1 0 9 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 0 0 5 , 1 8 9 4 , 1 7 9 4 , 1 5 9 4 , 1 0 7 4 , 1 9 6 4 , 1 9 5 4 , 1 0 5 4 , 1 4 4 4 , 1 9 2 4 , 1 8 0 4 , 1 1 0 4 , 1 7 8 3 , 1 6 6 3 , 1 4 8 2 , 1 7 7 2 , 1 3 7 2 , 1 6 6 2 , 1 1 6 2 , 1 6 5 2 , 1 3 1 2 , 1 6 0 2 , 1 9 7 1 , 1 6 3 1 , 1 4 3 1 , 1 8 1 1 , 1 5 9 0 , 1 5 8 0 , 1 5 7 0 , 1 7 6 0 , 1 4 6 0 , 1 4 6 0 , 1 0 5 0 , 1 9 4 0 , 1 2 4 0 , 1 7 3 0 , 1 2 3 0 , 1 9 2 0 , 1 6 1 0 , 1 3 1 0 , 1 9 0 0 , 1 7 0 0 , 1 6 0 0 , 1 4 0 0 , 1 2 0 0 , 1 0 0 0 , 1 9 9 9 8 9 9 7 9 9 2 9 9 2 9 9 8 8 9 6 7 9 5 6 9 2 3 9 9 2 9 7 1 9 5 0 9 1 0 9 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ) d e u n i t n o C ( - - 2 2 8 8 - - c n I s e c i v r e S l a i c n a n i F n o s d i v a D - y e l r a H C L P d e r e t r a h C d r a d n a t S G A k n a b l l o r t n o K e h c s i h c i e r r e t s e O / Y N A U k n a b o b a R e v e i t a r e p o o C P L n o i s s i m s n a r T n r e t s a E s a x e T o C r e w o P a l e h a g n o n o M g n i d n u F l a b o l G e f i L n a i d r a u G C L P k n a B C B S H c n I A S U C B S H p r o C S B C p r o C e c n a t p e c c A r o t o M n a s s i N e h T / o C n o i n U n r e t s e W c n I n o s i d E d e t a d i l o s n o C C L L g n i d n u F e r o c n e l G y g r e n E a r p m e S p r o C t s a c m o C c n I p u o r G e s i r p r e t n E e c i v r e S c i l b u P u a b f u a r e d e i W r e u f t l a t s n a t i d e r K c n I s o C n a n n e L c M & h s r a M o C r e p a P l a n o i t a n r e t n I d t L a d a n a C e c n a n i F e r o c n e l G k n a B t n e m p o l e v e D n a c i r f A P L g n i t a r e p O P R E d t L s r e m r a f s e W o C n o s i d E h t l a e w n o m m o C g n i d n u F l a b o l G e n e h t A p r o C l a n o i t a N n l o c n i L A S A l i o t a t S c n I n e g o i B o C y g r e n E y a w a h t a H e r i h s k r e B d t L s g n i d l o H t n e c n e T p r o C l a t i p a C s e r A p u o r G m u n U o C c i r t c e l E l a r e n e G c n I s e c r u o s e R G O E c n I o C & k c r e M c n I A C c n I s t e k r a M l a b o l G e o b C c n I s a s n a k r A y g r e t n E C L L c i f i c a P - a i g r o e G g n i d n u F l a b o l G G A I p r o C X T A G p r o C y g r e t n E s g n i d l o H a c i r e m A f o p r o C y r o t a r o b a L p r o C l a t i p a C e r e e D n h o J e h T / c n I t o p e D e m o H e h T / o C r e k c u m S M J P L s g n i d l o H a c i r e m A f o t s u r T e r a c h t l a e H c n I s e i t r e p o r P l i a t e R l a n o i t a N A N A S U k n a B e n O l a t i p a C C L L s s e r g o r P y g r e n E e k u D c n I g n i d n u F l a t i p a C L P P V C e d B A S a s m e F a l o C - a c o C p r o C n i t r a M d e e h k c o L o C g n i t a r e n e G c i r t c e l E n r e h t u o S p r o C e c n a n i F d t L e g n u B c n I s a x e T y g r e t n E d t L T I L X p r o C n o s s e K c M l a b o l G C M S T ) d e u n i t n o C ( - - 3 3 8 8 - - e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 4 9 8 4 8 8 3 6 8 8 5 8 9 4 8 6 3 8 5 3 8 9 1 8 7 1 8 2 1 8 2 1 8 5 0 8 2 0 8 4 9 7 4 9 7 3 9 7 5 8 7 9 7 7 3 5 7 7 3 7 0 2 7 9 1 7 5 1 7 4 1 7 6 0 7 0 0 7 0 0 7 8 9 6 8 9 6 7 9 6 7 8 6 1 8 6 5 7 6 9 5 6 8 5 6 9 4 6 6 4 6 4 4 6 2 4 6 7 3 6 1 3 6 1 3 6 8 2 6 3 1 6 2 1 6 2 1 6 0 1 6 4 0 6 8 9 5 2 9 5 1 9 5 8 8 5 8 7 5 6 7 5 3 7 5 2 5 5 0 5 5 8 4 5 2 4 5 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 4 9 8 4 8 8 3 6 8 8 5 8 9 4 8 6 3 8 5 3 8 9 1 8 7 1 8 2 1 8 2 1 8 5 0 8 2 0 8 4 9 7 4 9 7 3 9 7 5 8 7 9 7 7 3 5 7 7 3 7 0 2 7 9 1 7 5 1 7 4 1 7 6 0 7 0 0 7 0 0 7 8 9 6 8 9 6 7 9 6 7 8 6 1 8 6 5 7 6 9 5 6 8 5 6 9 4 6 6 4 6 4 4 6 2 4 6 7 3 6 1 3 6 1 3 6 8 2 6 3 1 6 2 1 6 2 1 6 0 1 6 4 0 6 8 9 5 2 9 5 1 9 5 8 8 5 8 7 5 6 7 5 3 7 5 2 5 5 0 5 5 8 4 5 2 4 5 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - t s u r T h g u o r h T s s a P A s s a l C 1 - 7 0 0 2 s e n i l r i A l a t n e n i t n o C C L L a n a i s i u o L s e t a t S f l u G y g r e t n E 2 t s u r T p u o r G e r t n e c S / 1 t s u r T p u o r G e r t n e c S d t L s d n a l s I n a m y a C I e c n a n i F s e g r o G e e r h T p r o C c i r t c e l E & s a G r e t s e h c o R P L y t l a e R o d a n r o V o C X T T o C r e w o P o i h O V N k n a B G N I C L L e c n a n i F y t l a i c e p S S I X A P L s r e n t r a P K O E N O C L L e c n a n i F t o v i P c e t i c n I p r o C l a i c n a n i F e f i l u n a M P L s r e n t r a P y g r e n E a r t c e p S c n I d r a z z i l B n o i s i v i t c A d t L l a t i p a C c e p o n i S c n I u d i a B C L L s r e w o T e l t s a C n w o r C C L L s s e r g o r P y g r e n E e k u D d t L s e n i l e p i P T P A C L L o C E G a s e h g u H r e k a B o C y g r e n E E T D p r o C e c n a n i F a d n o H n a c i r e m A A S l a n o i t a n r e t n I l a t i p a C l a t o T o C y a w l i a R n r e h t u o S k l o f r o N p r o C r o c u N C L P n o A c n I s e i t i u q E e t a t s E l a e R a i r d n a x e l A c n I n a w e h c t a k s a S f o p r o C h s a t o P c n I p u o r G e l p p a n S r e p p e P r D c n I p u o r G s e i t i r u c e S a w i a D V C e d B A S o b m B o p u r G i P L y t r e p o r P y t r e b i L p r o C o c d l o H A S U C B R o C r e w o P a i g r o e G p r o C e v i t r o F p r o C s e i g o l o n h c e T e f i L d t L n o i t a i v A C O B p r o C k r a l C - y l r e b m K i o C s s e r p x E n a c i r e m A c n I p u o r G a i r t l A c n I C B A c n I s e i t i n u m m o C y a B n o l a v A C L P e c n a n i F y t l a i c e p S S I X A P L s t r o s e R & s l e t o H t s o H d t L k n a B o h u z i M s n i d r a j s e D e l a r t n e C e s s i a C P L s e i t r e p o r P n o t s o B p r o C e c n a n i F d t L e g n u B p r o C l i b o M n o x x E c n I r o g i l b O - o C s e h g u H / r e k a B C L L o C E G a s e h g u H r e k a B t s u r T h g u o r h T s s a P 1 - A s s a l C 1 - 0 0 0 2 s e n i l r i A l a t n e n i t n o C c n I k r o Y w e N f o o C n o s i d E d e t a d i l o s n o C H O / c n I s e r a h s c n a B n o t g n i t n u H c n I d r a c r e t s a M c n I e f i L t e M t s u r T t n e m t s e v n I y t l a e R l a r e d e F c n I s e r o t S t r a M - l a W d t L e c n a n i F C O O N C l a b o l G C M S T e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 6 3 5 2 2 5 1 2 5 7 1 5 6 1 5 2 1 5 4 0 5 3 0 5 1 0 5 1 0 5 1 0 5 0 0 5 6 8 4 3 7 4 0 7 4 6 6 4 3 6 4 8 5 4 4 5 4 7 3 4 4 3 4 1 3 4 1 3 4 5 1 4 5 1 4 9 9 3 6 9 3 4 9 3 1 9 3 0 9 3 2 8 3 7 7 3 4 6 3 2 6 3 1 5 3 5 2 3 2 2 3 4 1 3 3 0 3 8 9 2 4 9 2 9 8 2 9 8 2 8 8 2 9 7 2 2 5 2 9 4 2 3 4 2 7 3 2 7 3 2 8 2 2 7 2 2 3 2 2 0 1 2 6 0 2 1 0 2 9 9 1 1 6 1 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 6 3 5 2 2 5 1 2 5 7 1 5 6 1 5 2 1 5 4 0 5 3 0 5 1 0 5 1 0 5 1 0 5 0 0 5 6 8 4 3 7 4 0 7 4 6 6 4 3 6 4 8 5 4 4 5 4 7 3 4 4 3 4 1 3 4 1 3 4 5 1 4 5 1 4 9 9 3 6 9 3 4 9 3 1 9 3 0 9 3 2 8 3 7 7 3 4 6 3 2 6 3 1 5 3 5 2 3 2 2 3 4 1 3 3 0 3 8 9 2 4 9 2 9 8 2 9 8 2 8 8 2 9 7 2 2 5 2 9 4 2 3 4 2 7 3 2 7 3 2 8 2 2 7 2 2 3 2 2 0 1 2 6 0 2 1 0 2 9 9 1 1 6 1 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ) d e u n i t n o C ( - - 4 4 8 8 - - C L L m a r g o r P e t o N m r e T - m u i d e M S U s a b i r a P P N B / s a b i r a P P N B p r o C X R O I I I g n i d n u F l a b o l G l a u t u M s s a M e h T / o C c i r t c e l E t t e s n a g a r r a N c n I y g r e n E t n i o P r e t n e C c n I a c i r e m o C p r o C n o t a E B A k n a b d e w S o C n o t r u b i l l a H o C y a w l i a R c i f i c a P n a i d a n a C o C r e w o P o c i x e M w e N - s a x e T y t e i c o S g n i d l i u B e d i w n o i t a N d t L s e n i L e p i P a d a n a C s n a r T d t L p u o r G s h t r o w l o o W p r o C y g r e n E o r e l a V c n I x a f i u q E c n I e r i p S C L L e c n a n i F a c i r e m A f o p u o r G n e g a w s k l o V c n I p u o r G l a i c n a n i F a r a g a i N t s r i F c n I s e c i v r e S l a i c n a n i F e d i w n o i t a N p r o C s e c r u o s e R y g r e n E t n i o P r e t n e C c n I p u o r G l a i c n a n i F p r o C n a t S p r o C n o A o C r e w o P n r e h t u o S C L L t i d e r C M B I e h T / c n I p u o r G s e c i v r e S l a i c n a n i F d r o f t r a H c n I e s i r p r e t n E l a s r e v i n U C B N p r o C y g r e n E S M C o C t h g i L & r e w o P y t i C s a s n a K d t L a d a n a C e c n a n i F r e g r e b m u l h c S c n I s g n i d l o H s m e t s y S E A B o C & y l l i L i l E c n I s g n i d l o H a r u m o N C L L e c n a n i F D M E C L P k n a B s y a l c r a B p r o C l o n e h p m A c n I s e c i v r e S n o i t a m r o f n I l a n o i t a N y t i l e d i F a i l a r t s u A f o k n a B h t l a e w n o m m o C p r o C l a t i p a C t s e W e l c a n n i P E S c i r t c e l E r e d i e n h c S C L L V W M k c o R t s e W p r o C e f i L e v i t c e t o r P C L P e c y o R - s l l o R c n I t n a r u s s A G A k n a B e h c s t u e D c n I p p A t e N c n I s m e t s y S o c s i C 6 6 s p i l l i h P p r o C i f i c a P c n I y a B e c n I e c n a i l l A s t o o B s n e e r g l a W c n I o C r e w o P c i r t c e l E n a c i r e m A o C r e w o P c i r t c e l E n r e t s e w h t u o S c n I l a i c n a n i F l a i t n e d u r P p r o C g n i d l o H e d a r t i r e m A D T p r o C s r e t n e C y c n e g e R p r o C l a i c n a n i F n o t l u F C L L e F a t n a S n r e h t r o N n o t g n i l r u B l a b o l G C M S T e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H ) d e u n i t n o C ( 0 6 1 5 3 1 0 2 1 9 7 2 2 5 1 , 4 9 9 3 4 1 , 3 4 9 0 0 1 , 4 7 7 0 0 1 , 3 6 3 0 5 , 7 7 2 0 5 , 6 3 2 0 5 , 5 0 0 0 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 0 3 4 , 3 6 5 1 0 6 2 , $ S U $ S U 3 2 1 0 9 5 , 7 1 1 3 3 2 , 1 4 7 1 1 1 , 4 5 2 8 2 , 7 4 1 , 6 5 6 8 , 3 4 0 0 , 3 0 9 9 , 2 1 5 5 , 2 7 3 5 , 1 0 8 1 , 1 4 9 8 3 1 3 8 2 3 8 4 , 2 2 7 5 4 , 1 1 2 9 3 , 0 6 0 1 3 , 4 4 5 2 2 , 8 0 8 0 2 , 4 0 9 3 1 , 2 9 7 2 1 , 4 3 2 2 1 , 2 0 0 2 1 , 1 3 4 1 1 , 3 5 9 0 1 , 1 2 8 0 1 , 9 5 3 0 1 , 9 4 0 0 1 , 5 3 3 , 9 9 7 1 , 9 7 8 7 , 8 7 4 0 , 8 9 0 5 , 7 4 1 1 , 7 1 0 0 , 7 9 5 8 , 6 9 6 7 , 6 9 4 7 , 6 8 2 7 , 6 1 1 5 , 6 1 6 9 , 5 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 0 6 1 5 3 1 0 2 1 5 0 0 0 5 1 , 2 4 0 2 4 1 , 0 0 0 0 0 1 , 0 0 0 0 0 1 , 0 0 0 0 5 , 0 0 0 0 5 , 0 9 9 9 4 , 0 0 0 0 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 0 3 4 , 3 6 5 1 0 6 2 , $ S U $ S U 3 2 1 0 9 5 , 7 1 1 3 3 2 , 1 4 7 1 1 1 , 4 5 2 8 2 , 7 4 1 , 6 5 6 8 , 3 4 0 0 , 3 0 9 9 , 2 1 5 5 , 2 7 3 5 , 1 0 8 1 , 1 4 9 8 3 1 3 8 2 3 8 4 , 2 2 7 5 4 , 1 1 2 9 3 , 0 6 0 1 3 , 4 4 5 2 2 , 8 0 8 0 2 , 4 0 9 3 1 , 2 9 7 2 1 , 4 3 2 2 1 , 2 0 0 2 1 , 1 3 4 1 1 , 3 5 9 0 1 , 1 2 8 0 1 , 9 5 3 0 1 , 9 4 0 0 1 , 5 3 3 , 9 9 7 1 , 9 7 8 7 , 8 7 4 0 , 8 9 0 5 , 7 4 1 1 , 7 1 0 0 , 7 9 5 8 , 6 9 6 7 , 6 9 4 7 , 6 8 2 7 , 6 1 1 5 , 6 1 6 9 , 5 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A " " s t e s s a l a i c n a n i f y t i r u t a m - o t - d l e H " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A " " " " " " " " " " " " " " " " " " " " " " " " " " " - - 5 5 8 8 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - s e t a c i f i t r e C h g u o r h T s s a P d e r u t c u r t S y l i m a f i t l u M c a M e i d d e r F n o i t a i c o s s A e g a g t r o M l a n o i t a N t n e m n r e v o G s k n a B n a o L e m o H l a r e d e F e a M e i n n i G s e i t i r u c e s d e k c a b - e g a g t r o m y c n e g A / s d n o b y c n e g A e a M e i n n a F c a M e i d d e r F 1 V E R - 4 1 0 2 t i d e r C d r o F / t s u r T r e n w O o t u A t i d e r C d r o F 2 C - 2 1 0 2 t s u r T e g a g t r o M l a i c r e m m o C s y a l c r a B - S B U t s u r T r e t s a M t n u o c c A t i d e r C s s e r p x E n a c i r e m A A t s u r T r e n w O r e t s a M n a l p r o o l F t i d e r C d r o F t s u r T n o i t u c e x E t e s s A - i t l u M e n O l a t i p a C t s u r T h c n y L l l i r r e M a c i r e m A f o k n a B y e l n a t S n a g r o M t s u r T r e n w O C - 4 1 0 2 s e l b a v i e c e R o t u A a t o y o T t s u r T e g a g t r o M M M O C C L L I I g n i d n u F e k a e p a s e h C t s u r T d r a C t i d e r C A B 7 P J - 7 1 0 2 t s u r T s e i t i r u c e S e g a g t r o M l a i c r e m m o C C C M P J A - 7 1 0 2 t s u r T n o i t a z i t i r u c e S e s a e L o t u A i a d n u y H t s u r T r e n w O 2 - 7 1 0 2 s e l b a v i e c e R o t u A a d n o H 3 - 5 1 0 2 t s u r T g n i s a e L e l i b o m o t u A l a i c n a n i F M G t s u r T r e n w O r e t s a M z n e B - s e d e c r e M 2 R - 0 1 0 2 t s u r T s e t o N d e e t n a r a u G A U C N a e r o K f o k n a B t r o p m I - t r o p x E a d a n a C t n e m p o l e v e D t r o p x E a d a n a C c e b e u Q f o e c n i v o r P s k n a B t i d e r C m r a F l a r e d e F c n I l a t i p a C B I P P C - A M N G C M L H F t s u r T e c n a u s s I d r a C t i d e r C k n a b i t i C t s u r T e t o N n o i t u c e x E d r a C r e v o c s i D s e i t i r u c e s d e k c a b - t e s s A t s u r T e c n a u s s I e s a h C a n i h C f o k n a B l a i c r e m m o C d n a l a i r t s u d n I a i l a r t s u A f o k n a B h t l a e w n o m m o C k n a B a i l a r t s u A l a n o i t a N a i t o c S a v o N f o k n a B d n o B l a n o i t a n r e t n I t n e m n r e v o G i b a h D u b A d n o B / e t o N y r u s a e r T s e t a t S d e t i n U d n o b t n e m n r e v o G p r o C e c n a n i F y a w a h t a H e r i h s k r e B a c i r e m A f o p r o C g n i g a k c a P C L L a d i r o l F y g r e n E e k u D o C & o g r a F s l l e W . c n I , p u o r G s h c a S n a m d l o G . p r o C g n i k n a B c a p t s e W . o C & e s a h C n a g r o M P J l a b o l G C M S T 2 1 C - 3 1 0 2 t s u r T s e i t i r u c e S e g a g t r o M l a i c r e m m o C B B M P J 1 1 C G - 3 1 0 2 t s u r T e g a g t r o M l a i c r e m m o C p u o r g i t i C s e l b a v i e c e R t s u r T r e n w O r e t s a M n a s s i N t s u r T s e l b a v i e c e R o t u A i a d n u y H t s u r T e s a e L e l c i h e V W M B t s u r T s e i t i r u c e S e g a g t r o M S G t s u r T r e n w O o t u A t i d e r C d r o F t s u r T e s a e L o t u A n a s s i N C O B I - 7 1 0 2 t s u r T e g a g t r o M l a i c r e m m o C B B D G C K N A B e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 3 6 8 , 4 8 2 5 , 4 0 7 9 , 3 1 1 8 , 3 4 2 6 , 3 6 8 4 , 3 4 3 4 , 3 9 0 0 , 3 7 7 8 , 2 2 4 4 , 2 6 0 0 , 2 0 2 8 , 1 3 1 5 , 1 8 9 9 5 4 8 1 3 8 1 0 5 5 8 4 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 4 4 7 9 4 , $ S U 0 0 0 , 2 0 0 0 , 2 0 0 0 , 1 $ S U $ S U $ S U 5 3 6 5 6 , $ S U 0 0 8 $ S U 0 7 1 $ S U 9 0 2 , 5 7 0 6 , 2 8 6 1 , 2 9 3 3 $ S U $ S U $ S U $ S U - - - ) d e d u l c n o C ( 0 7 3 $ S U 4 8 3 $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 4 1 1 - 1 4 2 0 2 3 4 4 - - 3 6 8 , 4 8 2 5 , 4 0 7 9 , 3 1 1 8 , 3 4 2 6 , 3 6 8 4 , 3 4 3 4 , 3 9 0 0 , 3 7 7 8 , 2 2 4 4 , 2 6 0 0 , 2 0 2 8 , 1 3 1 5 , 1 8 9 9 5 4 8 1 3 8 1 0 5 5 8 4 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 0 0 0 0 5 , $ S U 0 0 0 , 2 0 0 0 , 2 0 0 0 , 1 $ S U $ S U $ S U 5 3 6 5 6 , $ S U - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A s t e s s a l a i c n a n i f y t i r u t a m - o t - d l e H " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A t s o c t a d e i r r a c s t e s s a l a i c n a n i F 0 0 8 $ S U 0 0 6 , 1 t s o c t a d e i r r a c s t e s s a l a i c n a n i F 0 7 1 $ S U 7 4 1 , 4 t s o c t a d e i r r a c s t e s s a l a i c n a n i F - - - 9 0 2 , 5 7 0 6 , 2 8 6 1 , 2 9 3 3 $ S U $ S U $ S U $ S U 0 6 4 3 0 9 3 6 9 5 8 0 , 1 0 3 2 8 7 2 4 6 2 " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A t s o c t a d e i r r a c s t e s s a l a i c n a n i F t s o c t a d e i r r a c s t e s s a l a i c n a n i F t s o c t a d e i r r a c s t e s s a l a i c n a n i F t s o c t a d e i r r a c s t e s s a l a i c n a n i F 0 7 3 $ S U 1 2 2 t s o c t a d e i r r a c s t e s s a l a i c n a n i F 4 8 3 $ S U 0 3 2 t s o c t a d e i r r a c s t e s s a l a i c n a n i F - - 6 6 8 8 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - A - 7 1 0 2 t s u r T r e n w O r e t s a M t n e m p i u q E l a i c n a n i F o v l o V 0 2 C L - 5 1 0 2 t s u r T e g a g t r o M l a i c r e m m o C o g r a F s l l e W 7 C - 7 1 0 2 t s u r T s e i t i r u c e S e g a g t r o M l a i c r e m m o C B D M P J t s u r T r e n w O r e t s a M n a l p r o o l F W M B C L L A O C M S C 1 - 7 1 0 2 e l i b o m o t u A r e m u s n o C l a i c n a n i F M G t s u r T e s a e L o t u A t i d e r C d r o F 3 E C I - 7 1 0 2 t s u r T e g a r o t S d l o C P L g n i d n u F e s a e L t e e l F z t r e H C L L 2 V P S s l e e h W 1 C - 1 1 0 2 t s u r T e g a g t r o M l a i c r e m m o C E R C F C A - 6 1 0 2 t s u r T e s a e L o t u A z n e B - s e d e c r e M t s u r T I l a t i p a C y e l n a t S n a g r o M t s u r T e g a g t r o M e u n e v A k r a P 0 8 2 C L L g n i c n a n i F t e e l F e s i r p r e t n E 1 - 5 1 0 2 t s u r T s e l b a v i e c e R o t u A z n e B - s e d e c r e M 4 1 C - 3 1 0 2 t s u r T e g a g t r o M l a i c r e m m o C S B R F W J F U i h s i b u s t i M - o y k o T f o k n a B t c u d o r p e r u t c u r t S J F U i h s i b u s t i M - o y k o T f o k n a B l t s n I e l a r e n e G e t e i c o S r e p a p l a i c r e m m o C k n a B n i k u h c n i r o N d n u F t s u r T r e n w O B - 7 1 0 2 s e l b a v i e c e R o t u A n a s s i N l a b o l G C M S T . . P L I I d n u F l a t i p a C a r e v a m i r P . p r o C g n i t h g i L s d e L d i u q i L k c o t s n o m m o C I I I F A T V . c n I , s e i g o l o n h c e T V 5 . c n I , s m e t s y S r e h t e A k c o t s d e r r e f e r P . c n I , x i n o c o e N k c o t s n o m m o C a i t n a u q A c i l e t n e S k c o t s d e r r e f e r P . c n I , s c i n o S k c o t s n o m m o C . c n I , s c i n o S k c o t s d e r r e f e r P . c n I , s c i n o S k c o t s n o m m o C . c n I , m u i v o n n I k c o t s d e r r e f e r P . c n I , m u i v o n n I I I F A T V F D S I I I F D S I d n u F h t w o r G 4 E L B A T ) 1 e t o N ( e c n a l a B g n i d n E t n u o m A ) s d n a s u o h T n I ( l a s o p s i D s t i n U / s e r a h S n o s s o L / n i a G e u l a V g n i y r r a C t n u o m A s t i n U / s e r a h S ) s d n a s u o h T n I ( t n u o m A s t i n U / s e r a h S ) s d n a s u o h T n I ( t n u o m A s t i n U / s e r a h S ) s d n a s u o h T n I ( l a s o p s i D n o i t i s i u q c A e c n a l a B g n n n i i g e B f o e r u t a N i p h s n o i t a l e R y t r a p - r e t n u o C t n e m e t a t S l a i c n a n i F t n u o c c A s e i t i r u c e S e l b a t e k r a M e m a N d n a e p y T e m a N y n a p m o C L A T I P A C N I - D I A P E H T F O % 0 2 R O N O I L L I M 0 0 3 $ T N T S A E L T A F O S E C I R P R O S T S O C T A F O D E S O P S I D D N A D E R I U Q C A S E I T I R U C E S E L B A T E K R A M ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F s e i r a i d i s b u S d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T - - - , 7 7 8 1 1 2 9 0 3 , 0 4 7 , 3 9 4 6 2 , $ - - - 9 - 6 7 8 0 4 , $ S U 1 1 9 9 2 , 7 6 8 6 2 , 9 5 1 6 2 , 9 0 7 2 2 , 5 0 5 8 1 , 8 9 2 8 1 , 2 3 7 7 1 , 4 2 0 7 1 , 3 6 4 6 1 , 2 2 7 2 1 , 4 1 2 2 1 , 3 1 6 1 1 , 3 7 0 1 1 , 1 0 3 , 9 6 6 8 , 6 9 1 7 , 2 8 0 6 , 1 9 9 0 , 1 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - 9 8 6 2 0 2 , $ S U 1 0 9 9 4 , $ S U 7 9 9 , 2 $ S U ) d e u n i t n o C ( - - - - - - - - - - - - - - - - - - - - - - - - 8 2 $ S U 9 9 2 , 9 - - - - - - - - 2 5 5 5 1 , $ S U - - - ) 4 3 1 ( $ S U 5 0 2 8 1 , $ S U 1 7 0 8 1 , $ S U ) 7 1 ( ) 3 1 ( ) 6 7 ( ) 7 0 1 ( 5 4 ) 2 5 ( ) 1 2 1 ( - ) 8 ( - 1 - ) 1 ( 4 8 3 1 7 5 6 8 ) 6 6 2 ( $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 3 3 8 , 5 8 3 4 , 6 6 7 9 , 1 3 7 9 , 8 8 5 2 2 1 , 6 1 0 , 2 3 6 1 5 1 , - 2 6 8 - 0 0 2 - 8 9 9 , 1 2 9 9 , 4 8 4 5 , 3 5 9 4 0 1 , 6 0 6 0 1 , 0 7 5 0 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 6 1 8 , 5 5 2 4 , 6 0 0 9 , 1 8 1 0 , 9 1 5 1 2 1 , 4 6 9 , 1 2 4 0 5 1 , - 4 5 8 - 1 0 2 - 7 9 9 , 1 6 7 0 , 5 1 6 5 , 3 2 5 5 0 1 , 0 4 3 0 1 , 6 5 6 0 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U ) 1 6 6 ( $ S U 4 1 5 4 9 3 , $ S U 3 5 8 3 9 3 , $ S U 3 1 1 $ S U 7 8 4 3 6 1 , $ S U 0 0 6 3 6 1 , $ S U 0 1 4 3 ) 2 7 1 ( $ S U $ S U $ S U 7 8 1 5 2 , 8 7 6 7 9 , 5 1 5 7 2 , $ S U $ S U $ S U 7 9 1 5 2 , 2 1 7 7 9 , 3 4 3 7 2 , $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - 2 9 8 , 4 2 7 , 1 2 4 1 9 , 0 3 $ S U 5 5 9 , 8 1 3 3 9 , 9 1 0 3 0 , 6 1 1 1 2 , 7 1 5 1 1 , 6 1 0 5 2 , 6 1 9 4 8 , 1 1 4 4 1 , 7 1 7 3 7 , 4 1 3 8 6 , 2 1 2 6 7 , 0 1 0 0 6 , 1 1 8 7 0 , 1 1 9 7 2 , 1 1 5 2 4 , 0 1 5 9 9 , 5 - - $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 2 5 5 , 6 9 3 $ S U 9 2 6 , 2 8 1 $ S U 0 8 1 , 8 2 8 7 6 , 7 9 0 6 0 , 8 $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - $ , 0 0 0 0 6 9 , 1 $ , 0 0 0 0 6 9 , 1 $ 0 0 0 0 0 4 , 0 0 0 0 0 4 , - - - - $ - - 0 5 2 , 0 0 4 3 0 3 , 7 6 9 , 1 $ - - 0 0 0 , 0 5 3 0 1 , 0 0 0 , 0 5 3 0 1 , 5 3 0 , 1 1 7 7 , 5 9 6 , 1 0 7 1 6 7 1 , 8 2 6 , 8 5 6 8 - - - 0 1 0 , 3 8 6 , 0 6 2 9 2 7 , 4 3 6 , 5 6 2 4 9 0 , 1 3 3 , 6 7 - y r a i d i s b u S y r a i d i s b u S - - 7 7 8 8 - - 8 7 0 , 6 $ S U 9 9 2 , 9 y r a i d i s b u S 2 e t o N 3 7 9 , 7 2 $ S U 9 1 8 , 6 1 2 3 3 , 3 1 0 3 3 , 2 2 0 9 3 , 7 7 3 2 , 1 1 9 5 0 , 7 1 7 7 8 , 7 - $ S U $ S U $ S U $ S U $ S U $ S U $ S U 7 0 6 , 2 $ S U - 4 0 7 , 1 $ S U - - 4 9 9 , 1 5 0 9 , 2 0 8 1 , 7 0 5 8 , 1 1 8 1 6 , 1 1 $ S U $ S U $ S U $ S U $ S U 5 8 2 , 5 9 1 $ S U 6 5 7 , 0 3 $ S U - - 9 4 3 , 9 1 $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - l a i c n a n i f y t i r u t a m - o t - d l e H n a w i a T , n o i t a r o p r o C C P C s t e s s a " . d t L , . o C . d n I n o i s i c e r P i a H n o H d n o b e t a r o p r o C C M S T l a i c n a n i f y t i r u t a m - o t - d l e H s t e s s a " r o f d e t n u o c c a s t n e m t s e v n I d o h t e m y t i u q e g n i s u r o f d e t n u o c c a s t n e m t s e v n I d o h t e m y t i u q e g n i s u y n a p m o C r e w o P n a w i a T r e p a p l a i c r e m m o C l a b o l G C M S T k c o t S g n i j n a N C M S T I I F D S I k c o t S s r e n t r a P C M S T s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A p r o C a c i r e m A f o k n a B d n o b e t a r o p r o C l a b o l G C M S T " " " " " " " " " " " " " " " " " " e h T / c n I p u o r G s h c a S n a m d l o G o C & e s a h C n a g r o M P J c n I s n o i t a c i n u m m o C n o z i r e V C L L o C t i d e r C r o t o M d r o F y e l n a t S n a g r o M c n I p u o r g i t i C c n I T & T A k n a B t n e m p o l e v e D n a i s A o C & e s a h C n a g r o M P J C L L l a t i p a C S U W M B c n I s e c n e i c S d a e l i G c n I M M O C L A U Q p r o C t f o s o r c i M c n I a n t e A p r o C l a t i p a C T A B y e l n a t S n a g r o M c n I s d o o F n o s y T c n I e l p p A d n o b t n e m n r e v o G s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A d n o B / e t o N y r u s a e r T s e t a t S d e t i n U " " " " g n i t a o l F y r u s a e r T s e t a t S d e t i n U e t o N e t a R n o i t a l f n I y r u s a e r T s e t a t S d e t i n U l l i B y r u s a e r T s e t a t S d e t i n U l l i B y r u s a e r T s e t a t S d e t i n U s d n o B d e x e d n I ) 1 e t o N ( e c n a l a B g n i d n E t n u o m A ) s d n a s u o h T n I ( l a s o p s i D s t i n U / s e r a h S n o s s o L / n i a G e u l a V g n i y r r a C t n u o m A s t i n U / s e r a h S ) s d n a s u o h T n I ( t n u o m A s t i n U / s e r a h S ) s d n a s u o h T n I ( t n u o m A s t i n U / s e r a h S ) s d n a s u o h T n I ( l a s o p s i D n o i t i s i u q c A e c n a l a B g n n n i i g e B f o e r u t a N i p h s n o i t a l e R y t r a p - r e t n u o C t n e m e t a t S l a i c n a n i F t n u o c c A s e i t i r u c e S e l b a t e k r a M e m a N d n a e p y T e m a N y n a p m o C 6 2 5 9 4 , $ S U 5 7 2 1 4 , 9 0 1 8 1 , 9 3 7 6 1 , 2 1 0 6 1 , 8 5 7 5 1 , 2 1 5 4 1 , 5 1 4 4 1 , 6 6 8 , 2 8 7 3 , 2 5 1 0 , 2 5 4 1 6 2 4 1 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - 8 2 3 8 4 , $ S U 2 2 7 5 4 , $ S U 1 1 2 9 3 , 4 4 5 2 2 , $ S U $ S U 8 0 8 0 2 , $ S U 1 2 8 0 1 , $ S U 5 3 6 5 6 , $ S U - ) d e d u l c n o C ( - - - - - - - - - - - - - - - - - - - - - - - - - - - - ) 6 ( ) 3 4 ( ) 7 1 2 ( ) 1 7 ( ) 5 3 ( ) 3 4 ( ) 0 1 ( ) 6 0 1 ( - 5 7 1 ) 9 ( 0 9 5 6 7 2 ) 3 ( ) 0 4 ( $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - 7 8 8 3 5 6 2 8 , 1 0 1 3 2 1 4 1 1 0 3 3 3 4 , 0 1 0 , 1 6 0 4 2 6 , 8 0 8 9 3 , 2 9 6 6 3 , 6 9 0 7 2 , 1 2 7 1 2 , 8 2 1 1 1 , 4 0 4 4 5 1 , 8 7 5 2 5 1 , 1 2 1 2 1 , 4 4 5 2 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - 1 8 5 9 4 9 0 6 , 1 - 0 8 3 4 5 9 2 3 4 , 4 0 9 6 0 4 2 6 , 3 1 8 9 3 , 9 0 7 6 3 , 7 8 0 7 2 , 6 2 7 1 2 , 4 3 1 1 1 , 4 9 4 4 5 1 , 5 0 6 2 5 1 , 1 8 0 2 1 , 1 4 5 2 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U ) 9 9 1 ( $ S U 6 6 7 , 7 $ S U 7 6 5 , 7 $ S U ) 2 1 ( 3 ) 1 8 ( 3 ) 9 ( - $ S U 3 0 0 4 1 , $ S U 1 9 9 3 1 , $ S U $ S U $ S U 4 0 6 2 1 , 4 8 3 8 1 , $ S U $ S U 7 0 6 2 1 , 3 0 3 8 1 , $ S U $ S U $ S U 4 2 9 , 5 $ S U 7 2 9 , 5 $ S U $ S U 6 1 4 4 1 , $ S U 7 0 4 4 1 , $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - 9 1 6 , 9 4 $ S U 2 2 3 , 3 4 7 2 8 , 8 1 7 9 4 , 6 1 7 7 7 , 5 1 4 3 1 , 9 5 7 7 8 , 4 1 2 5 3 , 4 1 0 2 5 , 2 1 9 7 2 , 5 6 4 9 1 , 2 4 0 1 7 , 8 3 1 4 2 , 7 2 1 2 7 , 1 2 8 2 1 , 1 1 4 0 4 , 4 5 1 8 7 5 , 2 5 1 3 2 1 , 2 1 4 4 5 , 2 1 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 2 0 4 , 3 3 $ S U 5 5 6 , 6 3 $ S U 4 1 2 , 1 8 3 5 , 0 2 $ S U $ S U 3 9 7 , 4 1 $ S U 4 8 7 , 7 $ S U 1 5 8 , 1 4 $ S U 3 5 7 4 1 , $ S U 7 0 2 , 3 $ S U 0 6 9 7 1 , $ S U 1 8 5 , 6 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 0 1 $ S U 5 8 5 , 2 2 $ S U 6 7 0 , 3 2 $ S U 6 7 2 , 1 3 6 2 6 , 9 3 $ S U $ S U 4 4 9 , 1 1 $ S U 5 6 4 , 7 1 $ S U 4 8 7 , 3 2 $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - 7 8 3 , 6 $ S U 1 8 5 , 6 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " e g a g t r o M l a n o i t a N t n e m n r e v o G 8 4 9 1 M B L O O P A M N F 6 8 8 1 M B L O O P A M N F e g a g t r o M l a n o i t a N t n e m n r e v o G 5 . 4 r Y 0 3 A B T A M N F e a M e i n n a F n o i t a i c o s s A e a M e i n n a F 3 0 9 9 L A L O O P A M N F 5 . 3 r Y 0 3 A B T A M N F 4 r Y 0 3 A B T I I A M N G 3 r Y 5 1 A B T A M N F 5 . 3 r Y 0 3 A B T I I A M N G n o i t a i c o s s A 3 4 5 r Y 0 3 A B T A M N F r Y 0 3 A B T A M N F r Y 0 3 A B T A M N F 5 7 3 7 0 G l o o P C P N L M H D E F 3 r Y 0 3 A B T I I A M N G k n a B n a o L e m o H l a r e d e F s e t o N t n u o c s i D s e i t i r u c e s d e k c a b - t e s s A l a i c n a n i f e l a s - r o f - e l b a l i a v A e c n a u s s I d r a C t i d e r C k n a b i t i C s t e s s a t s u r T " " " " " e t o N n o i t u c e x E d r a C r e v o c s i D r e t s a M n a l p r o o l F t i d e r C d r o F t e s s A - i t l u M e n O l a t i p a C t s u r T e c n a u s s I e s a h C t s u r T n o i t u c e x E t s u r T d r a C t i d e r C A B A t s u r T r e n w O t s u r T d n u F s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A 6 9 1 3 M B L O O P A M N F s e i t i r u c e s d e k c a b - e g a g t r o m y c n e g A / s d n o b y c n e g A l a b o l G C M S T t s o c t a d e i r r a c s t e s s a l a i c n a n i F . l a i c n a n i f e l a s - r o f - e l b a l i a v A s t e s s a . P L I I d n u F l a t i p a C a r e v a m i r P d e t i i m L s e i g o l o n h c e T p i h c l A k c o t S I I F D S I - - 8 8 8 8 - - . t n e m t s u j d a d e t a l e r r e h t o d n a s e e t s e v n i f o s e s s o l / s t i f o r p f o e r a h s , s t n e m t s e v n i s d n o b n o t n u o c s i d / m u i m e r p f o n o i t a z i t r o m a e h t s e d u l c n i e c n a l a b g n i d n e e h T . n r u t e r l a t i p a c f o d e t s i s n o c y l i r a m i r p s i l a s o p s i d e h T : 1 : 2 e t o N e t o N 5 E L B A T y t r a p - r e t n u o C d e t a l e R f o n o i t c a s n a r T r o i r P r e h t O s m r e T f o e s o p r u P n o i t i s i u q c A e c n e r e f e R e c i r P t n u o m A e t a D r e f s n a r T s p i h s n o i t a l e R r e n w O f o e r u t a N i s p h s n o i t a l e R y t r a p - r e t n u o C m r e T t n e m y a P n o i t c a s n a r T t n u o m A n g i e r o F ( n i s e i c n e r r u C ) s d n a s u o h T e t a D n o i t c a s n a r T f o s e p y T y t r e p o r P y n a p m o C e m a N L A T I P A C N I - D I A P E H T F O % 0 2 R O N O I L L I M 0 0 3 $ T N T S A E L T A F O S T S O C T A S E I T R E P O R P E T A T S E L A E R L A U D I V I D N I F O N O I T I S I U Q C A ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F s e i r a i d i s b u S d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T ) d e u n i t n o C ( e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e s o p r u p d n a n o s i r a p m o c n o i t a i t o g e n e c i r p e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e s o p r u p d n a n o s i r a p m o c n o i t a i t o g e n e c i r p e s o p r u p d n a n o s i r a p m o c n o i t a i t o g e n e c i r p A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / - - - - - - - - - - - - - - - - 9 9 8 8 - - . d t L , . o C l a i r t s u d n I h c e T - h i y g n a U e h t y b t n e m e l t t e s y l h t n o M 0 2 6 , 2 0 3 . d t L , . o C n o i t c u r t s n o C u s T u F e h t y b t n e m e l t t e s y l h t n o M 7 7 5 , 3 3 8 , 6 e c n a t p e c c a d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a H C E T I H M E T S Y S H C E T E L O H W e h t y b t n e m e l t t e s y l h t n o M 9 9 1 , 7 0 3 D E T I M I L d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 , 8 2 r e b m e c e D o t 6 1 0 2 , 0 1 t s u g u A o t 6 1 0 2 , 2 2 r e b m e t p e S 7 1 0 2 , 5 r e b m e t p e S 7 1 0 2 , 4 1 r e b m e c e D o t 7 1 0 2 , 3 1 y r a u n a J n o i t a r o p r o C n o i t c u r t s n o C A S A T e h t y b t n e m e l t t e s y l h t n o M 6 6 7 , 2 5 3 7 1 0 2 , 8 1 y r a u n a J . P R O C L A N O I T A N R E T N I d n a s s e r g o r p n o i t c u r t s n o c H C E T E K R A M e h t y b t n e m e l t t e s y l h t n o M 1 5 1 , 0 1 3 e c n a t p e c c a d t L I , . o C L A R T S U D N I E I J I L e h t y b t n e m e l t t e s y l h t n o M 7 9 3 , 7 1 3 d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a . d t L I , . o C L A R T S U D N I d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a I Y N U T e h t y b t n e m e l t t e s y l h t n o M 4 5 3 , 8 5 3 . d t L , . o C t n e m p o l e v e D e n o t S d l o G e h t y b t n e m e l t t e s y l h t n o M 8 4 7 , 0 0 3 . p r o C c i t i r u P n a w i a T e h t y b t n e m e l t t e s y l h t n o M 6 9 9 , 3 0 3 d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a y g o l o n h c e T l a c i m e h C k e t n u H - a c i C e h t y b t n e m e l t t e s y l h t n o M 1 9 9 , 8 5 7 d t L , . o C n a w i a T d n a s s e r g o r p n o i t c u r t s n o c . d t L , . o C n o i t c u r t s n o C E G D E K e h t y b t n e m e l t t e s y l h t n o M 1 3 1 , 5 8 4 e c n a t p e c c a d t L , . o C l a n o i t a n r e t n I n a u Y n e h C e h t y b t n e m e l t t e s y l h t n o M 6 6 5 , 2 2 5 . d t L , . o C n o i t c u r t s n o C N C A D I e h t y b t n e m e l t t e s y l h t n o M 6 8 3 , 8 9 8 , 6 d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 , 2 r e b m e v o N o t 7 1 0 2 , 5 1 h c r a M 7 1 0 2 , 5 1 r e b m e c e D o t 7 1 0 2 , 5 1 h c r a M 7 1 0 2 , 5 1 r e b m e c e D o t 7 1 0 2 , 7 1 h c r a M 7 1 0 2 , 0 3 r e b m e v o N o t 7 1 0 2 , 1 2 h c r a M 7 1 0 2 , 5 2 r e b m e c e D o t 7 1 0 2 , 1 2 h c r a M 7 1 0 2 , 7 2 r e b m e c e D o t 7 1 0 2 , 7 2 h c r a M 7 1 0 2 , 9 2 r e b m e t p e S o t 7 1 0 2 , 4 1 l i r p A 7 1 0 2 , 3 r e b m e v o N o t 7 1 0 2 , 8 1 l i r p A 7 1 0 2 , 9 2 r e b m e c e D o t 7 1 0 2 , 5 2 y a M b a F b a F b a F b a F b a F b a F b a F b a F b a F b a F b a F b a F b a F . D T L , . O C S E C V R E S I d n a s s e r g o r p n o i t c u r t s n o c D E T A R G E T N I D E T I N U e h t y b t n e m e l t t e s y l h t n o M 7 3 8 , 2 4 6 $ 7 1 0 2 , 5 r e b m e c e D o t 6 1 0 2 , 2 t s u g u A b a F C M S T y t r a p - r e t n u o C d e t a l e R f o n o i t c a s n a r T r o i r P r e h t O s m r e T f o e s o p r u P n o i t i s i u q c A e c n e r e f e R e c i r P t n u o m A e t a D r e f s n a r T s p i h s n o i t a l e R r e n w O f o e r u t a N i s p h s n o i t a l e R y t r a p - r e t n u o C m r e T t n e m y a P n o i t c a s n a r T t n u o m A n g i e r o F ( n i s e i c n e r r u C ) s d n a s u o h T e t a D n o i t c a s n a r T f o s e p y T y t r e p o r P y n a p m o C e m a N ) d e d u l c n o C ( e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e n o N g n i r u t c a f u n a M e s o p r u p g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e s o p r u p d n a n o s i r a p m o c n o i t a i t o g e n e c i r p A N / A N / A N / A N / A N / A N / A N / A N / A N / e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / A N / A N / A N / - - - - . d t L , . o C ) i a h g n a h S ( n o i t a r o c e D d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a . d t L , . o C p u o r G e y o a B i a h g n a h S e h t y b t n e m e l t t e s y l h t n o M 0 0 0 , 8 9 B M R , 7 2 e n u J o t 7 1 0 2 , 2 2 e n u J d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 r o i r e t n I g n o h c n e R e h t y b t n e m e l t t e s y l h t n o M 7 2 0 , 9 1 1 B M R 7 1 0 2 , 5 2 y a M b a F b a F d n a L f o u a e r u B l a p i c i n u M g n i j n a N t n e m y a p % 0 0 1 2 4 0 , 0 8 1 B M R 7 1 0 2 , 8 1 r e b m e c e D e s u d n a L s e c r u o s e R d n a t h g i r n o i s i v i D t s r i F n o i t c u r t s n o C a n i h C e h t y b t n e m e l t t e s y l h t n o M 0 0 3 , 3 8 1 B M R , 3 2 e n u J o t 7 1 0 2 , 1 2 h c r a M b a F C M S T & n o i t c u r t s n o C p u o r G . d t L , . o C t n e m p o l e v e D d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 y n a p m o C g n i j n a N . d t L - - 0 0 9 9 - - e t o N o t % l a t o T 6 E L B A T r o e l b a y a P s t n u o c c A / s e t o N e l b a v i e c e R e c n a l a B g n i d n E ) s d n a s u o h T n i s e i c n e r r u C n g i e r o F ( s m r e T t n e m y a P e c i r P t i n U s m r e T t n e m y a P o t % l a t o T t n u o m A s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i / s e s a h c r u P s e l a S s p i h s n o i t a l e R f o e r u t a N y t r a P d e t a l e R e m a N y n a p m o C 1 - 5 4 1 1 - - - - 0 3 7 , 7 7 7 ) 1 4 1 , 0 4 4 , 1 ( ) 4 9 0 , 8 2 3 , 1 ( ) 0 5 9 , 9 0 4 ( ) 9 5 9 , 6 0 4 ( - ) 6 6 2 , 8 2 6 1 , 5 4 2 2 3 2 , 1 6 1 $ S U ( - - - - - - - - 7 7 0 1 5 , 9 2 3 , 1 9 $ e t o N - - - - - - - - - d e u s s i s i e c i o v n i n e h w f o h t n o m d e u s s i s i e c i o v n i n e h w f o h t n o m d e u s s i s i e c i o v n i n e h w f o h t n o m d e u s s i s i e c i o v n i n e h w f o h t n o m d e u s s i s i e c i o v n i n e h w f o h t n o m e h t f o d n e e h t m o r f s y a d 0 3 t e N e h t f o d n e e h t m o r f s y a d 0 3 t e N e h t f o d n e e h t m o r f s y a d 0 3 t e N e h t f o d n e e h t m o r f s y a d 0 3 t e N e h t f o d n e e h t m o r f s y a d 0 3 t e N d e u s s i s i e c i o v n i n e h w f o h t n o m e h t f o d n e e h t m o r f s y a d 0 3 t e N ) 1 e t o N ( 1 - 7 2 1 1 7 5 5 6 1 , 4 6 8 , 6 2 7 6 , 6 1 4 s e l a S s e l a S 0 5 8 , 9 5 0 , 2 2 s e s a h c r u P e t a i c o s s A y r a i d i s b u S y r a i d i s b u S 1 4 7 , 3 8 7 , 8 s e s a h c r u P y r a i d i s b u s t c e r i d n I 7 2 7 , 5 5 7 , 5 s e s a h c r u P 0 9 1 , 8 4 1 , 4 s e s a h c r u P e t a i c o s s A e t a i c o s s A g n i j n a N C M S T a n i h C C M S T h c e T r e f a W C U G C M S S S I V e t a d e c i o v n i m o r f s y a d 0 3 t e N 4 6 7 3 5 , 1 5 3 , 0 5 6 $ s e l a S y r a i d i s b u S a c i r e m A h t r o N C M S T C M S T d e u s s i s i e c i o v n i n e h w f o h t n o m e h t f o d n e e h t m o r f s y a d 0 3 t e N 6 1 0 1 2 , 1 0 4 d e u s s i s i e c i o v n i n e h w f o h t n o m e h t f o d n e e h t m o r f s y a d 0 3 t e N 1 ) 4 0 3 , 5 2 5 7 0 , 5 1 1 B M R ( e t a d e c i o v n i m o r f s y a d 0 3 t e N - 0 6 5 , 8 3 0 , 1 ) 9 4 1 , 4 3 $ S U ( s e l a S s e l a S s e l a S C M S T f o e t a i c o s s A C U G a c i r e m A h t r o N C M S T C M S T f o e t a i c o s s A c e t n i X h c e T a r E s i V C M S T f o e t a i c o s s A C M S S a n i h C C M S T . a c i r e m A h t r o N C M S T y b s t n e i l c s t i o t d e t n a r g s m r e t t n e m y a p e h t y b d e n i m r e t e d r o e t a d e c i o v n i s ’ C M S T m o r f s y a d 0 3 s i r o n e t e h T : e t o N - - 1 1 9 9 - - n o i t c a s n a r T l a m r o n b A s l i a t e D n o i t c a s n a r T L A T I P A C N I - D I A P E H T F O % 0 2 R O N O I L L I M 0 0 1 $ T N T S A E L T A F O S E I T R A P D E T A L E R O T S E L A S R O M O R F S E S A H C R U P L A T O T ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F s e i r a i d i s b u S d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T 7 E L B A T - - - - - - - - - - 0 1 0 , 1 7 5 $ 2 5 0 , 9 6 2 , 7 1 $ 1 7 6 ) 7 4 1 - - - ) 2 5 4 5 5 , 1 B M R ( $ S U ( ) 7 8 6 , 3 6 6 3 , 9 0 1 $ S U ( - - - - - - - - - - 9 3 7 , 1 2 5 8 6 0 , 0 4 3 , 7 $ 1 7 6 ) 7 4 1 - - - ) 2 5 4 5 5 , 1 B M R ( $ S U ( ) 4 2 6 , 3 3 8 4 , 7 0 1 $ S U ( 0 5 2 e t o N 5 4 6 2 2 e t o N 2 e t o N 4 5 3 4 0 5 r o f e c n a w o l l A s t b e D d a B d e v i e c e R s t n u o m A t n e u q e s b u S n i d o i r e P e u d r e v O n e k a T n o i t c A t n u o m A s y a D r e v o n r u T ) 1 e t o N ( e c n a l a B g n i d n E s e i c n e r r u C n g i e r o F ( s p i h s n o i t a l e R f o e r u t a N y t r a P d e t a l e R e m a N y n a p m o C ) s d n a s u o h T n i 0 3 7 , 7 7 7 4 8 4 , 4 5 7 , 1 1 1 6 , 5 7 5 , 2 9 $ 1 4 1 , 0 4 4 , 1 ) 8 3 2 , 6 1 3 B M R ( 5 2 0 , 7 6 1 , 0 2 ) 4 3 9 , 7 2 4 , 4 B M R ( y n a p m o c t n e r a p e m a s e h T g n i j n a N C M S T y n a p m o c t n e r a P C M S T a n i h C C M S T y r a i d i s b u S y r a i d i s b u S e t a i c o s s A a c i r e m A h t r o N C M S T g n i j n a N C M S T C U G C M S T ) 9 8 9 , 8 9 9 5 , 6 6 2 $ S U ( e h t f o t n e r a p e t a m i t l u e h T y n a p m o C C M S T y g o l o n h c e T C M S T 4 9 0 , 8 2 3 , 1 ) 9 7 7 , 4 4 $ S U ( e h t f o t n e r a p e t a m i t l u e h T y n a p m o C C M S T h c e T r e f a W 2 3 2 , 1 6 1 C M S T f o e t a i c o s s A c e t n i X h c e T a r E s i V ) 6 6 2 , 8 2 6 1 , 5 4 2 $ S U ( C M S T f o e t a i c o s s A C U G a c i r e m A h t r o N C M S T . s y a d r e v o n r u t f o n o i t a l u c l a c e h t r o f e l b a c i l p p a t o n s i h c i h w , s e l b a v i e c e r r e h t o f o d e t s i s n o c y l i r a m i r p s i e c n a l a b g n i d n e e h T : 2 . s e i t r a p d e t a l e r m o r f s e l b a v i e c e r r e h t o s e d u l c x e s y a d r e v o n r u t f o n o i t a l u c l a c e h T : 1 e t o N e t o N L A T I P A C N I - D I A P E H T F O % 0 2 R O N O I L L I M 0 0 1 $ T N T S A E L T A O T G N I T N U O M A S E I T R A P D E T A L E R M O R F S E L B A V I E C E R ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( 7 1 0 2 , 1 3 R E B M E C E D - - 2 2 9 9 - - s e i r a i d i s b u S d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T 8 E L B A T f o e g a t n e c r e P e u n e v e R t e N d e t a d i l o s n o C s t e s s A l a t o T r o s m r e T ) 2 e t o N ( s n o i t c a s n a r T y n a p m o c r e t n I t n u o m A m e t I s t n e m e t a t S l a i c n a n i F f o e r u t a N p i h s n o i t a l e R ) 1 e t o N ( % 5 % 7 6 - - - - - - % 2 % 1 - - - - - - % 1 % 1 - - - - - - - - - - - - - - - - - - 6 3 1 , 0 1 2 1 6 5 , 7 3 4 1 0 1 , 6 4 2 , 1 0 1 5 , 9 2 3 , 1 9 7 6 2 , 5 3 1 1 4 1 , 0 4 4 , 1 2 7 6 , 6 1 4 0 5 8 , 9 5 0 , 2 2 4 8 4 , 4 5 7 , 1 6 4 8 , 6 3 3 , 4 1 0 0 8 , 1 5 2 9 9 5 , 6 6 2 2 4 9 , 4 9 8 , 1 0 9 7 , 0 2 1 1 4 7 , 3 8 7 , 8 4 9 0 , 8 2 3 , 1 5 2 0 , 7 6 1 , 0 2 7 3 5 , 1 5 3 , 0 5 6 $ t n e m p i u q e d n a t n a l p , y t r e p o r p f o l a s o p s i d m o r f s d e e c o r P t n e m p i u q e d n a t n a l p , y t r e p o r p f o l a s o p s i d m o r f s d e e c o r P s e i t r a p d e t a l e r m o r f s e l b a v i e c e r r e h t O s e i t r a p d e t a l e r o t s e l b a y a P s e i t r a p d e t a l e r m o r f s e l b a v i e c e r r e h t O s e s n e p x e t n e m p o l e v e d d n a h c r a e s e R s e s n e p x e t n e m p o l e v e d d n a h c r a e s e R s e i t r a p d e t a l e r o t s e l b a y a P s e s a h c r u P s e i t r a p d e t a l e r m o r f s e l b a v i e c e r r e h t O n o i s s i m m o c n o i s s i m m o c - - s e s n e p x e g n i t e k r a M s e s n e p x e g n i t e k r a M s d o o g f o e l a s m o r f e u n e v e r t e N s e i t r a p d e t a l e r m o r f s e l b a v i e c e R n o i s s i m m o c - s e s n e p x e g n i t e k r a M s d o o g f o e l a s m o r f e u n e v e r t e N s e i t r a p d e t a l e r o t s e l b a y a P s e s a h c r u P 1 1 1 1 1 1 1 1 3 e p o r u E C M S T a n i h C C M S T n a p a J C M S T g n i j n a N C M S T y g o l o n h c e T C M S T a d a n a C C M S T h c e T r e f a W y t r a P r e t n u o C e m a N y n a p m o C . o N a c i r e m A h t r o N C M S T C M S T 0 . y r a i d i s b u s o t y n a p m o c t n e r a p m o r f s n o i t c a s n a r t . s e i r a i d i s b u s n e e w t e b s n o i t c a s n a r t e h t e h t s t n e s e r p e r s t n e s e r p e r 1 3 . o N . o N : 1 e t o N g n i j n a N C M S T a n i h C C M S T 1 . s t n e m e e r g a l a u t u m h t i w e c n a d r o c c a n i d e n i m r e t e d e r a s m r e t d n a s e c i r p , s n o i t c a s n a r t y n a p m o c r e t n i r e h t o r o F . s e i t r a p d r i h t o t e s o h t m o r f t n e r e f f i d y l t n a c i f i n g i s t o n e r a s e l a s y n a p m o c r e t n i f o s m r e t t n e m y a p d n a s e c i r p s e l a s e h T : 2 e t o N S N O I T C A S N A R T Y N A P M O C R E T N I T N A C I F I N G I S D N A S P I H S N O I T A L E R Y N A P M O C R E T N I 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F ) s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( s e i r a i d i s b u S d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T - - 3 3 9 9 - - 9 E L B A T e t o N f o e r a h S s e s s o L / s t i f o r P e e t s e v n I f o ) 1 e t o N ( n g i e r o F ( n i s e i c n e r r u C ) s d n a s u o h T y r a i d i s b u S y r a i d i s b u S , 4 2 0 6 2 0 , 5 , 1 0 6 5 2 2 , 2 $ , 4 2 0 6 2 0 , 5 , 1 0 6 5 2 2 , 2 $ 7 8 2 , 4 8 6 9 4 , , 7 7 8 1 1 2 9 0 3 $ , e m o c n I t e N e h t f o ) s e s s o L ( e e t s e v n I n g i e r o F ( g n i y r r a C e u l a V n g i e r o F ( n i s e i c n e r r u C n i s e i c n e r r u C ) s d n a s u o h T ) s d n a s u o h T ) A N I H C D N A L N I A M N I T N E M T S E V N I N O N O I T A M R O F N I G N I D U L C X E ( E C N E U L F N I T N A C I F I N G I S S E S I C R E X E Y N A P M O C E H T H C I H W R E V O S E E T S E V N I F O N O I T A M R O F N I D E T A L E R D N A , S N O I T A C O L , S E M A N ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F s e i r a i d i s b u S d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T 7 1 0 2 , 1 3 r e b m e c e D f o s a e c n a l a B t n u o m A t n e m t s e v n I l a n i g i r O f o e g a t n e c r e P p i h s r e n w O n I ( s e r a h S ) s d n a s u o h T , 1 3 r e b m e c e D , 1 3 r e b m e c e D 6 1 0 2 n g i e r o F ( 7 1 0 2 n g i e r o F ( n i s e i c n e r r u C n i s e i c n e r r u C ) s d n a s u o h T ) s d n a s u o h T 0 0 1 0 0 1 9 8 6 2 8 8 9 , 0 3 1 , 6 5 4 , 1 3 0 3 1 , 6 5 4 , 1 3 9 1 2 , 7 0 2 , 2 3 2 $ 9 2 2 , 0 9 8 , 2 9 2 $ s t c u d o r P d n a s e s s e n i s u B n i a M n o i t a c o L y n a p m o C e e t s e v n I y n a p m o C r o t s e v n I e h t n i s s e n i s u b d e t a l e r r e h t o d n a , e r u t c a f u n a m t n e m t s e v n i r e h t o d n a y r t s u d n i r o t c u d n o c i m e s , n g i s e d e h t n i d e v l o v n i s e i n a p m o c n i g n i t s e v n I s e i t i v i t c a t n e m t s e v n I s e i t i v i t c a s d n a l s I n i g r i V h s i t i r B , a l o t r o T s d n a l s I n i g r i V h s i t i r B , a l o t r o T s r e n t r a P C M S T l a b o l G C M S T C M S T e t a i c o s s A , 3 7 0 4 2 7 , 1 , 4 3 6 4 4 4 , 4 , 0 4 6 7 7 6 , 5 y r a i d i s b u S 4 2 4 0 8 1 , 7 5 5 7 0 2 , , 2 6 1 7 6 6 , 4 9 3 7 8 4 1 3 8 2 0 , 0 2 1 , 5 8 2 0 , 0 2 1 , 5 s t i u c r i c d e t a r g e t n i f o g n i l l e s d n a g n i r u t c a f u n a M e r o p a g n i S 0 2 1 3 5 2 , 1 7 1 , 5 0 0 , 5 1 7 1 , 5 0 0 , 5 s t r a p e r a p s c i n o r t c e l e g n i r u t c a f u n a m n i d e g a g n E n a w i a T , u h C - n i s H s e c i v e d r o t c u d n o c i m e s r e h t o d n a h c e T a r E s i V C M S S s t i u c r i c d e t a r g e t n i f o n g i s e d d e d i a - r e t u p m o c s k s a m f o e c i v r e s n g i s e d d n a g n i r u t c a f u n a m e h t d n a s e c i v e d r o t c u d n o c i m e s r e h t o d n a e t a i c o s s A , 1 4 9 0 7 2 , 1 , 4 6 0 5 0 5 , 4 , 4 4 3 8 6 5 , 8 8 2 3 2 2 4 6 4 , 7 7 6 , 0 8 1 , 0 1 7 7 6 , 0 8 1 , 0 1 d n a g n i t s e t , g n i g a k c a p , g n i l l e s , g n i r u t c a f u n a M n a w i a T , u h C - n i s H S I V y r a i d i s b u S 9 5 8 , 5 9 5 8 , 5 , 3 0 0 1 0 0 , 4 0 0 1 0 0 0 1 1 , 8 1 7 , 3 3 3 8 1 7 , 3 3 3 d n a s t i u c r i c d e t a r g e t n i f o g n i t e k r a m d n a g n i l l e S g n i t s e t d n a g n i g a k c a p , g n i l l e s , g n i r u t c a f u n a m , g n i n g i s e d , g n i p o l e v e d , g n i h c r a e s e r n i d n a r e t l i f r o l o c f o . A S U . , a i n r o f i l a C , e s o J n a S a c i r e m A h t r o N C M S T ) d e u n i t n o C ( e t a i c o s s A ) 3 9 4 , 4 0 3 ( ) 0 8 2 , 3 3 7 ( , 0 0 1 2 9 2 , 2 e t a i c o s s A 6 1 8 7 9 2 , 9 0 8 4 5 8 , , 4 9 1 0 0 3 , 1 y r a i d i s b u S y r a i d i s b u S 7 5 5 0 4 , 5 2 9 0 3 1 , y r a i d i s b u S ) 9 2 7 4 2 ( , y r a i d i s b u S y r a i d i s b u S 0 0 6 , 3 0 7 9 , 1 y r a i d i s b u S ) 6 0 7 2 1 ( , 7 5 5 0 4 , 7 9 5 3 3 1 , ) 4 3 2 5 2 ( , 0 0 6 , 3 0 7 9 , 1 ) 6 0 7 2 1 ( , 4 2 3 7 0 4 , 3 3 5 0 2 3 , 6 3 8 2 5 1 , 6 4 4 9 2 1 , 0 1 2 9 3 , ) 7 1 2 0 2 ( , y r a i d i s b u S 2 e t o N , 0 0 9 8 4 4 , 1 5 6 4 , 9 7 3 6 2 , ) 9 7 4 7 4 , $ S U ( ) 5 2 4 9 8 8 , $ S U ( y r a i d i s b u S 2 e t o N y r a i d i s b u S 2 e t o N y r a i d i s b u S 2 e t o N y r a i d i s b u S 2 e t o N y r a i d i s b u S 2 e t o N e t a i c o s s A 2 e t o N ) 2 1 5 ) 7 1 6 0 9 9 8 1 , 7 9 5 5 1 , 9 9 2 8 7 3 , 9 3 8 6 1 6 8 1 5 , $ S U ( ) 6 8 4 7 1 , $ S U ( 1 2 3 2 8 1 , $ S U ( ) 7 4 1 , 6 $ S U ( ) 1 9 4 2 1 , $ S U ( ) 8 2 $ S U ( ) 1 4 4 2 9 4 $ S U ( ) 7 1 $ S U ( ) ) 6 4 ( ) 5 8 3 , 1 ( ) ) 9 8 5 ( ) 8 2 0 8 1 ( , 4 3 3 6 4 , $ S U ( ) 2 6 5 , 1 $ S U ( 0 1 2 3 2 , $ S U ( ) 3 8 7 $ S U ( 1 4 5 3 8 9 8 9 0 0 1 0 0 1 0 0 1 0 0 1 0 0 1 0 0 1 0 0 1 7 9 7 9 0 0 1 9 3 - - - 6 1 0 8 - - 0 0 3 , 2 9 9 2 , 9 3 8 5 - 3 9 6 , 4 ) 2 8 2 , 4 1 6 1 2 , 8 6 ) 0 0 3 , 2 0 9 5 , 3 2 4 4 4 0 , 4 5 1 ) 5 7 4 ) 4 9 1 , 5 4 9 0 , 4 1 ) 2 6 4 , 1 5 5 3 , 3 4 2 0 6 , 4 5 1 $ S U ( - 0 9 5 , 3 2 4 $ S U ( ) 2 8 2 , 4 1 $ S U ( 6 1 2 , 8 6 $ S U ( ) 0 0 3 , 2 $ S U ( s e i n a p m o c y g o l o n h c e t p u - t r a t s w e n n i g n i t s e v n I s e i t i v i t c a t r o p p u s g n i r e e n i g n E y r t s u d n i r o t c u d n o c i m e s s e i t i v i t c a t r o p p u s g n i r e e n i g n E $ S U ( ) 5 7 4 $ S U ( 4 9 0 , 4 1 s e i n a p m o c y g o l o n h c e t p u - t r a t s w e n n i g n i t s e v n I ) 3 1 2 , 5 $ S U ( ) 3 9 5 , 1 $ S U ( d n a , s l a i r e t a m c i n o r t c e l e f o g n i l i a t e r d n a D I F R f o g n i t s e t d n a g n i p o l e v e d , g n i h c r a e s e r - - 4 4 9 9 - - 0 6 7 , 3 8 6 5 6 , 3 1 6 6 2 , 5 2 9 4 7 , 5 1 2 6 5 , 8 0 6 7 1 4 , 5 5 3 , 1 0 6 7 , 3 8 6 5 6 , 3 1 6 6 2 , 5 2 9 4 7 , 5 1 1 3 8 , 2 1 4 5 8 8 , 8 1 3 , 1 s e i n a p m o c y g o l o n h c e t p u - t r a t s w e n n i g n i t s e v n I s e i n a p m o c y g o l o n h c e t p u - t r a t s w e n n i g n i t s e v n I g n i d i v o r p d n a s t c u d o r p d e t a l e r r a l o s f o g n i l l e S s e i t i v i t c a g n i t r o p p u s s e i t i v i t c a g n i t r o p p u s d n a d n a e c i v r e s r e m o t s u C e c i v r e s r e m o t s u C e c i v r e s r e m o t s u c 2 8 2 1 1 1 , 7 1 3 , 8 8 9 , 1 7 1 3 , 8 8 9 , 1 l e v e l r e f a w d n a g n i g a k c a p e z i s p i h c l e v e l r e f a W n a w i a T , n a u y o a T e c i v r e s n o i t c e n n o c r e t n i n o i t a v i s s a p t s o p 8 8 6 6 4 , 8 6 5 , 6 8 3 8 6 5 , 6 8 3 g n i t s e t , g n i r u t c a f u n a m , g n i p o l e v e d , g n i h c r a e s e R n a w i a T , u h C - n i s H s e c i v e d r o t c u d n o c i m e s r e h t o s t i u c r i c d e t a r g e t n i f o g n i t e k r a m d n a s e i t i v i t c a g n i t r o p p u s d n a e c i v r e s r e m o t s u C s d n a l r e h t e N e h t , m a d r e t s m A s d n a l s I n a m y a C s d n a l s I n a m y a C n a p a J , a m a h o k o Y a e r o K , l u o e S y n a m r e G , g r u b m a H H b m G e p o r u E r a l o S C M S T e p o r u E C M S T n a p a J C M S T a e r o K C M S T I I F A T V I I I F A T V c e t n i X C U G 8 1 0 , 8 0 4 , 7 1 8 1 0 , 8 0 4 , 7 1 ) 9 3 9 , 6 8 5 $ S U ( ) 9 3 9 , 6 8 5 $ S U ( e h t n i s s e n i s u b d e t a l e r g n i r u t c a f u n a m e h t n i d e v l o v n i s e i n a p m o c n i g n i t s e v n I . A S U . . A S U . , e r a w a l e D y g o l o n h c e T C M S T , e r a w a l e D t n e m p o l e v e D C M S T s r e n t r a P C M S T a d a n a C , o i r a t n O s d n a l s I n a m y a C s d n a l s I n a m y a C a d a n a C C M S T I I F D S I F D S I $ S U ( ) 4 5 1 , 2 $ S U ( 7 5 2 , 7 4 g n i l a s e l o h w , s t r a p c i n o r t c e l e f o g n i r u t c a f u n a M n a w i a T , i e p i a T w e N k a P - l a u t u M 9 7 8 , 3 6 s e i n a p m o c y g o l o n h c e t p u - t r a t s w e n n i g n i t s e v n I s d n a l s I n a m y a C d n u F h t w o r G I I I F A T V e t o N f o e r a h S s e s s o L / s t i f o r P e e t s e v n I f o ) 1 e t o N ( n g i e r o F ( n i s e i c n e r r u C ) s d n a s u o h T e m o c n I t e N e h t f o ) s e s s o L ( e e t s e v n I n g i e r o F ( g n i y r r a C e u l a V n g i e r o F ( n i s e i c n e r r u C n i s e i c n e r r u C ) s d n a s u o h T ) s d n a s u o h T 7 1 0 2 , 1 3 r e b m e c e D f o s a e c n a l a B t n u o m A t n e m t s e v n I l a n i g i r O f o e g a t n e c r e P p i h s r e n w O n I ( s e r a h S ) s d n a s u o h T , 1 3 r e b m e c e D , 1 3 r e b m e c e D 6 1 0 2 n g i e r o F ( 7 1 0 2 n g i e r o F ( n i s e i c n e r r u C n i s e i c n e r r u C ) s d n a s u o h T ) s d n a s u o h T s t c u d o r P d n a s e s s e n i s u B n i a M n o i t a c o L y n a p m o C e e t s e v n I y n a p m o C r o t s e v n I ) d e d u l c n o C ( . y n a p m o c r o t s e v n i e h t f o s e s s o l / s t i f o r p f o e r a h s e h t n i d e d u l c n i y d a e r l a s i t n u o m a h c u s s a n i e r e h d e t c e l f e r t o n s i y n a p m o c e e t s e v n i e h t f o s e s s o l / s t i f o r p f o e r a h s e h T : 2 e t o N . s n o i t c a s n a r t y n a p m o c r e t n i n o t i f o r p s s o r g d e z i l a e r n u f o t c e f f e e h t s e d u l c n i e e t s e v n i f o s e s s o l / s t i f o r p f o e r a h s e h T : 1 e t o N y r a i d i s b u S 2 e t o N , 8 5 6 8 4 2 , 1 $ , 2 4 3 2 6 7 , 4 $ ) 6 9 8 0 4 , $ S U ( ) 0 7 5 0 6 1 , $ S U ( 0 0 1 7 3 6 3 9 2 , - $ - $ d e t a r g e t n i f o g n i t s e t d n a g n i l l e s , g n i r u t c a f u n a M s e c i v e d r o t c u d n o c i m e s r e h t o d n a s t i u c r i c . A S U . , n o t g n i h s a W h c e T r e f a W t n e m p o l e v e D C M S T - - 5 5 9 9 - - 0 1 E L B A T d e t a l u m u c c A d r a w n I f o e c n a t t i m e R f o s a s g n i n r a E , 1 3 r e b m e c e D 7 1 0 2 g n i y r r a C t n u o m A f o s a , 1 3 r e b m e c e D 7 1 0 2 s e s s o L / s t i f o r P p i h s r e n w O e e t s e v n I y n a p m o C f o e r a h S f o e g a t n e c r e P e h t f o ) s e s s o L ( e m o c n I t e N d e t a l u m u c c A f o w o l f t u O m o r f t n e m t s e v n I f o s a n a w i a T , 1 3 r e b m e c e D n i $ S U ( 7 1 0 2 ) s d n a s u o h T s w o l F t n e m t s e v n I w o l f n I w o l f t u O n i $ S U ( ) s d n a s u o h T d e t a l u m u c c A f o w o l f t u O m o r f t n e m t s e v n I f o s a n a w i a T 7 1 0 2 , 1 y r a u n a J n i $ S U ( ) s d n a s u o h T f o d o h t e M t n e m t s e v n I f o t n u o m A l a t o T l a t i p a C n i - d i a P n i B M R ( ) s d n a s u o h T d n a s e s s e n i s u B n i a M s t c u d o r P y n a p m o C e e t s e v n I - - $ 5 8 8 , 0 6 0 , 1 5 $ 7 3 9 , 8 5 0 , 9 $ % 0 0 1 3 3 9 , 8 3 9 , 8 $ 7 6 6 , 9 3 9 , 8 1 $ - $ - $ 7 6 6 , 9 3 9 , 8 1 $ 1 e t o N ) 2 e t o N ( ) 0 0 0 , 6 9 5 $ S U ( ) 0 0 0 , 6 9 5 $ S U ( 7 6 6 , 9 3 9 , 8 1 $ ) 0 8 0 , 2 0 5 , 4 B M R ( n g i s e d d e d i a - r e t u p m o c s t i u c r i c d e t a r g e t n i f o d n a g n i t s e t r e h t o d n a s e c i v e d r o t c u d n o c i m e s , g n i l l e s , g n i r u t c a f u n a M a n i h C C M S T 0 4 7 , 3 9 4 , 6 2 ) 2 e t o N ( ) 3 6 5 , 7 6 8 ( % 0 0 1 ) 3 6 5 , 7 6 8 ( ) 0 0 0 , 0 2 9 $ S U ( 2 9 0 , 0 6 1 , 8 2 - ) 0 0 0 , 0 2 7 $ S U ( ) 0 0 0 , 0 0 2 $ S U ( ) 6 7 2 , 3 3 1 , 6 B M R ( d n a g n i t s e t 2 9 8 , 4 2 7 , 1 2 0 0 2 , 5 3 4 , 6 1 e t o N 2 9 0 , 0 6 1 , 8 2 , g n i l l e s , g n i r u t c a f u n a M g n i j n a N C M S T ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( A N I H C D N A L N I A M N I T N E M T S E V N I N O N O I T A M R O F N I 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y R O F t n e m t s e v n I n o t i i m L r e p p U A E O M , n o i s s i m m o C t n e m t s e v n I 3 e t o N ) s d n a s u o h T n i $ S U ( 7 6 6 , 2 1 4 , 9 1 1 $ ) 0 0 0 , 6 9 5 , 3 $ S U ( 7 1 0 2 , 1 3 r e b m e c e D f o s a ) s d n a s u o h T n i $ S U ( 9 5 7 , 9 9 0 7 4 , $ ) 0 0 0 6 1 5 , , 1 $ S U ( y b d e z i r o h t u A s t n u o m A t n e m t s e v n I a n i h C d n a l n i a M n i t n e m t s e v n I d e t a l u m u c c A n g i s e d d e d i a - r e t u p m o c s t i u c r i c d e t a r g e t n i f o r e h t o d n a s e c i v e d r o t c u d n o c i m e s f o e l p i c n i r P " o t t n a u s r u p a n i h C d n a l n i a m n i t n e m t s e v n i n o t i m i l r e p p u e h t , 6 1 0 2 t s u g u A n o A E O M , u a e r u B t n e m p o l e v e D l a i r t s u d n I y b d e u s s i s r e t r a u q d a e h g n i t a r e p o r o f d e i f i l a u q g n i e b f o e t a c i f i t r e c e h t d e n i a t b o s a h y n a p m o C e h t s A : 3 . e l b a c i l p p a t o n s i " a n i h C d n a l n i a M n i n o i t a r e p o o C l a c i n h c e T r o t n e m t s e v n i . g n i j n a N C M S T n i s d n a s u o h t 0 0 0 , 0 2 9 $ S U d n a a n i h C C M S T n i d n a s u o h t 0 0 0 , 6 9 5 $ S U d e t s e v n i y l t c e r i d C M S T : 1 . s t n e m e t a t s l a i c n a n i f d e t i d u a e h t n o d e s a b d e z i n g o c e r s a w t n u o m A : 2 e t o N e t o N e t o N - 6 9 - - 6 9 - s e i r a i d i s b u S d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T Taiwan Semiconductor Manufacturing Company Limited Parent Company Only Financial Statements for the Years Ended December 31, 2017 and 2016 and Independent Auditors’ Report - 97 - - 98 - - 99 - - 100 - - 101 - - 102 - Taiwan Semiconductor Manufacturing Company Limited PARENT COMPANY ONLY BALANCE SHEETS (In Thousands of New Taiwan Dollars) ASSETS CURRENT ASSETS Cash and cash equivalents (Note 6) Financial assets at fair value through profit or loss (Note 7) Available-for-sale financial assets Held-to-maturity financial assets (Note 8) Hedging derivative financial assets (Note 9) Notes and accounts receivable, net (Note 10) Receivables from related parties (Note 32) Other receivables from related parties (Note 32) Inventories (Notes 5, 11 and 35) Other financial assets (Note 35) Other current assets (Note 15) Total current assets NONCURRENT ASSETS Financial assets carried at cost Investments accounted for using equity method (Notes 5 and 12) Property, plant and equipment (Notes 5 and 13) Intangible assets (Notes 5 and 14) Deferred income tax assets (Notes 5 and 27) Refundable deposits Total noncurrent assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term loans (Note 16) Financial liabilities at fair value through profit or loss (Note 7) Hedging derivative financial liabilities (Note 9) Accounts payable Payables to related parties (Note 32) Salary and bonus payable Accrued profit sharing bonus to employees and compensation to directors (Notes 21 and 29) Payables to contractors and equipment suppliers Income tax payable (Notes 5 and 27) Provisions (Notes 5 and 17) Long-term liabilities - current portion (Note 18) Accrued expenses and other current liabilities (Note 20) Total current liabilities NONCURRENT LIABILITIES Bonds payable (Note 18) Deferred income tax liabilities (Notes 5 and 27) Net defined benefit liability (Notes 5 and 19) Guarantee deposits (Note 20) Others Total noncurrent liabilities Total liabilities EQUITY ATTRIBUTABLE TO SHAREHOLDERS OF THE PARENT Capital stock (Note 21) Capital surplus (Note 21) Retained earnings (Note 21) Appropriated as legal capital reserve Unappropriated earnings Others (Note 21) Total equity TOTAL The accompanying notes are an integral part of the parent company only financial statements. - 103 - - 103 - December 31, 2017 Amount % December 31, 2016 Amount % $ 239,176,841 373,351 2,393,555 - 7,378 26,655,427 92,141,837 3,143,872 70,297,445 94,839 2,484,792 12 - - - - 2 5 - 4 - - $ 249,878,563 151,070 2,843,952 11,447,538 - 40,017,297 86,845,570 948,800 46,504,346 2,139,366 3,004,662 14 - - 1 - 2 5 - 2 - - 436,769,337 23 443,781,164 24 415,051 463,986,364 1,016,355,970 9,870,127 10,829,473 1,163,069 - 24 52 - 1 - 435,268 396,855,708 979,401,337 10,047,991 6,446,781 369,895 - 22 53 1 - - 1,502,620,054 77 1,393,556,980 76 $ 1,939,389,391 100 $ 1,837,338,144 100 $ 63,766,850 18,764 15,562 25,605,223 4,829,664 12,283,321 23,388,002 50,363,976 32,950,667 13,174,825 24,300,000 57,686,386 $ 3 - - 1 - 1 1 3 2 1 1 3 57,958,200 62,441 - 24,533,924 4,840,001 11,570,505 22,794,771 62,449,143 40,256,148 16,991,612 38,100,000 28,620,469 3 - - 1 - 1 1 4 2 1 2 2 308,383,240 16 308,177,214 17 91,800,000 302,205 8,850,704 7,582,479 413,230 108,948,618 5 - 1 - - 6 116,100,000 141,183 8,551,408 14,666,542 453,536 139,912,669 6 - - 1 - 7 417,331,858 22 448,089,883 24 259,303,805 56,309,536 13 3 259,303,805 56,272,304 14 3 241,722,663 991,639,347 1,233,362,010 12 51 63 (26,917,818) (1) 208,297,945 863,710,224 1,072,008,169 1,663,983 12 47 59 - 1,522,057,533 78 1,389,248,261 76 $ 1,939,389,391 100 $ 1,837,338,144 100 Taiwan Semiconductor Manufacturing Company Limited PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) 2017 2016 Amount % Amount % NET REVENUE (Notes 5, 22 and 32) $ 969,136,109 100 $ 936,387,291 100 COST OF REVENUE (Notes 5, 11, 29, 32 and 35) 490,196,856 51 474,552,913 51 GROSS PROFIT BEFORE UNREALIZED GROSS PROFIT ON SALES TO SUBSIDIARIES AND ASSOCIATES UNREALIZED GROSS PROFIT ON SALES TO SUBSIDIARIES AND ASSOCIATES 478,939,253 49 461,834,378 49 (1,562) - (26,082) - GROSS PROFIT 478,937,691 49 461,808,296 49 OPERATING EXPENSES (Notes 5, 29, and 32) Research and development General and administrative Marketing 79,887,723 20,049,405 3,048,781 8 2 1 70,366,179 18,697,463 3,098,086 8 2 - Total operating expenses 102,985,909 11 92,161,728 10 OTHER OPERATING INCOME AND EXPENSES, NET (Notes 23 and 29) (1,261,665) - 83,965 - INCOME FROM OPERATIONS 374,690,117 38 369,730,533 39 NON-OPERATING INCOME AND EXPENSES Share of profits of subsidiaries and associates (Note 12) Other income (Note 24) Foreign exchange gain (loss), net (Note 36) Finance costs (Note 25) Other gains and losses, net (Note 26) 18,757,236 1,696,595 (670,371) (2,749,640) 1,592,239 Total non-operating income and expenses 18,626,059 2 - - - - 2 14,941,372 1,816,803 609,345 (2,643,193) 734,100 15,458,427 2 - - - - 2 INCOME BEFORE INCOME TAX 393,316,176 40 385,188,960 41 INCOME TAX EXPENSE (Notes 5 and 27) 50,204,700 5 50,941,780 5 NET INCOME 343,111,476 35 334,247,180 36 (Continued) - 104 - - 104 - Taiwan Semiconductor Manufacturing Company Limited PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings Per Share) OTHER COMPREHENSIVE INCOME (LOSS) (Notes 12, 19, 21 and 27) Items that will not be reclassified subsequently to profit or loss: Remeasurement of defined benefit obligation Share of other comprehensive loss of subsidiaries and associates Income tax benefit related to items that will not be reclassified subsequently Items that may be reclassified subsequently to profit or loss: Exchange differences arising on translation of 2017 2016 Amount % Amount % $ (254,681) - $ (1,057,220) (20,853) 30,562 (244,972) - - - (19,961) 126,867 (950,314) - - - - foreign operations (28,270,770) (3) (9,439,776) (1) Changes in fair value of available-for-sale financial assets Cash flow hedges Share of other comprehensive income (loss) of subsidiaries and associates Income tax expense related to items that may be reclassified subsequently (425,692) 4,683 123,804 (3,536) - - - - 47,506 - (656,684) (61,176) - - - - (28,571,511) (3) (10,110,130) (1) Other comprehensive loss for the year, net of income tax (28,816,483) (3) (11,060,444) (1) TOTAL COMPREHENSIVE INCOME FOR THE YEAR $ 314,294,993 32 $ 323,186,736 35 EARNINGS PER SHARE (NT$, Note 28) Basic earnings per share Diluted earnings per share $ $ 13.23 13.23 $ $ 12.89 12.89 The accompanying notes are an integral part of the parent company only financial statements. (Concluded) - 105 - - 105 - 3 3 5 , 7 5 0 , 2 2 5 , 1 $ ) 8 1 8 , 7 1 9 , 6 2 ( $ ) 0 9 2 , 0 1 ( $ 6 2 2 , 4 $ ) 4 7 0 , 4 1 2 ( $ ) 0 8 6 , 7 9 6 , 6 2 ( $ 0 1 0 , 2 6 3 , 3 3 2 , 1 $ 7 4 3 , 9 3 6 , 1 9 9 $ 3 6 6 , 2 2 7 , 1 4 2 $ 6 3 5 , 9 0 3 , 6 5 $ 5 0 8 , 3 0 3 , 9 5 2 $ 0 8 3 , 0 3 9 , 5 2 - - 6 6 0 0 1 1 - - - ) 3 8 2 , 2 8 5 , 5 5 1 ( ) 3 8 2 , 2 8 5 , 5 5 1 ( 0 8 1 , 7 4 2 , 4 3 3 - - - - ) 4 4 4 , 0 6 0 , 1 1 ( ) 0 3 1 , 0 1 1 , 0 1 ( 6 3 7 , 6 8 1 , 3 2 3 ) 0 3 1 , 0 1 1 , 0 1 ( ) 9 6 1 , 6 5 ( 1 2 2 , 1 2 7 3 0 , 7 - - - 1 6 2 , 8 4 2 , 9 8 3 , 1 3 8 9 , 3 6 6 , 1 - ) 3 6 6 , 2 1 5 , 1 8 1 ( ) 3 6 6 , 2 1 5 , 1 8 1 ( 6 7 4 , 1 1 1 , 3 4 3 - - - - ) 3 8 4 , 6 1 8 , 8 2 ( ) 1 1 5 , 1 7 5 , 8 2 ( 3 9 9 , 4 9 2 , 4 1 3 ) 1 1 5 , 1 7 5 , 8 2 ( l a t o T y t i u q E l a t o T 9 1 7 , 1 7 6 , 1 2 2 , 1 $ 3 1 1 , 4 7 7 , 1 1 $ - - - - - - - - - - - - - - - - - ) 5 0 2 , 3 ( 4 9 9 , 0 1 3 5 1 , 9 1 - - - - ) 0 9 2 , 0 1 ( ) 0 9 2 , 0 1 ( - - - - 2 1 7 2 1 7 - - - - - - - - - - ) 0 3 1 , 2 3 7 ( ) 0 3 1 , 2 3 7 ( - - - - - - - 1 2 1 , 4 1 2 1 , 4 - - - - - - - ) 5 1 7 , 6 1 2 ( ) 5 1 7 , 6 1 2 ( - - - - - - - - d e n r a e n U d e s a B - k c o t S e e y o l p m E n o i t a s n e p m o C s r e h t O w o l F h s a C e v r e s e R s e g d e H d e z i l a e r n U s s o L / n i a G - e l b a l i a v A m o r f e l a s - r o f s t e s s A l a i c n a n i F n g i e r o F y c n e r r u C n o i t a l s n a r T e v r e s e R l a t o T s g n i n r a E d e n i a t e R d e t a i r p o r p p a n U s g n i n r a E l a t i p a C l a g e L e v r e s e R s u l p r u S l a t i p a C t n u o m A s e r a h S ) s d n a s u o h T n I ( k c o t S n o m m o C - k c o t S l a t i p a C $ ) 7 0 6 ( $ 1 7 7 , 4 3 7 $ 9 4 9 , 9 3 0 , 1 1 $ 6 8 5 , 3 9 2 , 4 9 8 $ 5 2 0 , 3 5 6 , 6 1 7 $ 1 6 5 , 0 4 6 , 7 7 1 $ 5 1 2 , 0 0 3 , 6 5 $ 5 0 8 , 3 0 3 , 9 5 2 $ 0 8 3 , 0 3 9 , 5 2 6 1 0 2 , 1 Y R A U N A J , E C N A L A B Y T I U Q E N I S E G N A H C F O S T N E M E T A T S Y L N O Y N A P M O C T N E R A P ) e r a h S r e P s d n e d i v i D t p e c x E , s r a l l o D n a w i a T w e N f o s d n a s u o h T n I ( d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T 5 0 1 1 4 6 , 2 7 3 2 , 1 6 6 , 1 9 6 1 , 8 0 0 , 2 7 0 , 1 4 2 2 , 0 1 7 , 3 6 8 5 4 9 , 7 9 2 , 8 0 2 4 0 3 , 2 7 2 , 6 5 5 0 8 , 3 0 3 , 9 5 2 0 8 3 , 0 3 9 , 5 2 6 1 0 2 , 1 3 R E B M E C E D , E C N A L A B - - - - - - - - - ) 2 1 7 , 8 7 3 , 9 ( ) 4 1 3 , 0 5 9 ( ) 4 1 3 , 0 5 9 ( ) 2 1 7 , 8 7 3 , 9 ( 6 6 8 , 6 9 2 , 3 3 3 6 6 8 , 6 9 2 , 3 3 3 0 8 1 , 7 4 2 , 4 3 3 0 8 1 , 7 4 2 , 4 3 3 - ) 3 8 2 , 2 8 5 , 5 5 1 ( ) 3 8 2 , 2 8 5 , 5 5 1 ( ) 4 8 3 , 7 5 6 , 0 3 ( ) 3 8 2 , 2 8 5 , 5 5 1 ( ) 7 6 6 , 9 3 2 , 6 8 1 ( 4 8 3 , 7 5 6 , 0 3 - 4 8 3 , 7 5 6 , 0 3 - - - - - - ) 9 6 1 , 6 5 ( 1 2 2 , 1 2 7 3 0 , 7 - - - - - - - - - - - - - - - - - - x a t e m o c n i f o t e n , 6 1 0 2 n i ) s s o l ( e m o c n i e v i s n e h e r p m o c r e h t O d o h t e m y t i u q e g n i s u r o f d e t n u o c c a s t n e m t s e v n i f o l a s o p s i D s e t a i c o s s a f o s e i t i u q e n i s e g n a h c f o e r a h s o t s t n e m t s u j d A s e i r a i d i s b u s f o s e i t i u q e n i s e g n a h c f o e r a h s m o r F 6 1 0 2 n i ) s s o l ( e m o c n i e v i s n e h e r p m o c l a t o T e r a h s r e p 6 $ T N - s r e d l o h e r a h s o t s d n e d i v i d h s a C s g n i n r a e s ’ r a e y r o i r p f o s n o i t a i r p o r p p A e v r e s e r l a t i p a c l a g e L 6 1 0 2 n i e m o c n i t e N l a t o T - - - - - - - - - ) 7 1 9 , 8 5 3 , 8 2 ( ) 2 7 9 , 4 4 2 ( ) 2 7 9 , 4 4 2 ( ) 7 1 9 , 8 5 3 , 8 2 ( 4 0 5 , 6 6 8 , 2 4 3 4 0 5 , 6 6 8 , 2 4 3 6 7 4 , 1 1 1 , 3 4 3 6 7 4 , 1 1 1 , 3 4 3 - ) 3 6 6 , 2 1 5 , 1 8 1 ( ) 3 6 6 , 2 1 5 , 1 8 1 ( ) 8 1 7 , 4 2 4 , 3 3 ( ) 3 6 6 , 2 1 5 , 1 8 1 ( ) 1 8 3 , 7 3 9 , 4 1 2 ( 8 1 7 , 4 2 4 , 3 3 - 8 1 7 , 4 2 4 , 3 3 - - - - - - 5 8 0 , 7 4 9 9 , 0 1 3 5 1 , 9 1 - - - - - - - - - - - - - - - - - - . s t n e m e t a t s l a i c n a n i f y l n o y n a p m o c t n e r a p e h t f o t r a p l a r g e t n i n a e r a s e t o n g n i y n a p m o c c a e h T x a t e m o c n i f o t e n , 7 1 0 2 n i ) s s o l ( e m o c n i e v i s n e h e r p m o c r e h t O s e t a i c o s s a f o s e i t i u q e n i s e g n a h c f o e r a h s o t s t n e m t s u j d A s e i r a i d i s b u s f o s e i t i u q e n i s e g n a h c f o e r a h s m o r F 7 1 0 2 n i ) s s o l ( e m o c n i e v i s n e h e r p m o c l a t o T e r a h s r e p 7 $ T N - s r e d l o h e r a h s o t s d n e d i v i d h s a C s g n i n r a e s ’ r a e y r o i r p f o s n o i t a i r p o r p p A e v r e s e r l a t i p a c l a g e L 7 1 0 2 n i e m o c n i t e N l a t o T 7 1 0 2 , 1 3 R E B M E C E D , E C N A L A B s r e d l o h e r a h s m o r f n o i t a n o D - - - - - - - - - - - - Taiwan Semiconductor Manufacturing Company Limited PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments for: Depreciation expense Amortization expense Finance costs Share of profits of subsidiaries and associates Interest income Loss (gain) on disposal or retirement of property, plant and equipment, net Gain on disposal of intangible assets, net Impairment loss on financial assets Gain on disposal of available-for-sale financial assets, net Loss on disposal of investments accounted for using equity method, net Unrealized gross profit on sales to subsidiaries and associates Gain on foreign exchange, net Dividend income Changes in operating assets and liabilities: Financial instruments at fair value through profit or loss Notes and accounts receivable, net Receivables from related parties Other receivables from related parties Inventories Other financial assets Other current assets Accounts payable Payables to related parties Salary and bonus payable Accrued profit sharing bonus to employees and compensation to 2017 2016 $ 393,316,176 $ 385,188,960 250,597,135 4,325,028 2,749,640 (18,757,236) (1,554,792) 213,977,324 3,724,066 2,643,193 (14,941,372) (1,683,150) 1,008,989 (3,198) 6,137 (115,690) (100,503) - 4,537 (101,411) - 1,562 (9,118,776) (141,803) 296,065 26,082 (2,656,406) (133,653) (196,337) 7,253,120 (5,296,267) (733,023) (23,793,099) 2,029,903 510,739 1,275,185 (10,337) 712,816 (127,857) (20,448,337) (29,562,888) (493,473) 17,833,842 (22,662) 18,337 7,639,380 1,108,002 1,966,597 directors Accrued expenses and other current liabilities Provisions Net defined benefit liability Cash generated from operations Income taxes paid 593,231 29,615,847 (3,823,540) 44,615 630,496,025 1,881,697 3,891,345 7,961,632 46,163 577,935,510 (45,387,724) (61,695,694) Net cash generated by operating activities 568,800,331 532,547,786 CASH FLOWS FROM INVESTING ACTIVITIES Acquisitions of: Available-for-sale financial assets Held to maturity financial assets Investments accounted for using equity method Equity interest in subsidiary Property, plant and equipment Intangible assets - 107 - - 107 - - (1,695,771) (172) (11,242,766) (445,012) (1,630,700) (311,763,999) (323,009,940) (4,207,065) (Continued) (4,351,050) - - Taiwan Semiconductor Manufacturing Company Limited PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) Proceeds from disposal or redemption of: Available-for-sale financial assets Held-to-maturity financial assets Equity interest in subsidiary Property, plant and equipment Intangible assets Proceeds from return of capital of financial assets carried at cost Derecognition of hedging derivative financial instruments Interest received Other dividends received Dividends received from investments accounted for using equity method Refundable deposits paid Refundable deposits refunded Decrease in receivables for temporary payments Cash inflow from incorporation of subsidiary $ 2017 2016 $ 140,395 13,160,000 - 13,226,816 27,409 14,080 38,097 1,552,725 141,803 126,289 10,550,000 2,325 104,020 - 7,493 - 1,748,570 133,653 5,005,132 (1,227,010) 416,600 - - 5,469,549 (138,204) 169,464 47,924 396,262 Net cash used in investing activities (285,314,773) (321,918,310) CASH FLOWS FROM FINANCING ACTIVITIES Increase in short-term loans Repayment of bonds Interest paid Guarantee deposits received Guarantee deposits refunded Cash dividends Payment of partial acquisition of interests in subsidiaries Proceeds from partial disposal of interests in subsidiaries Donation from shareholders 10,394,485 (38,100,000) (2,916,969) 205,075 (89,507) 18,968,936 (12,000,000) (2,644,187) 420,719 (421,002) (181,512,663) (155,582,283) (74,130,714) 144,035 - (82,433,287) 257,648 7,938 Net cash used in financing activities (294,187,280) (225,244,496) NET DECREASE IN CASH AND CASH EQUIVALENTS (10,701,722) (14,615,020) CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 249,878,563 264,493,583 CASH AND CASH EQUIVALENTS, END OF YEAR $ 239,176,841 $ 249,878,563 The accompanying notes are an integral part of the parent company only financial statements. (Concluded) - 108 - - 108 - Taiwan Semiconductor Manufacturing Company Limited NOTES TO PARENT COMPANY ONLY FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2017 AND 2016 (Amounts in Thousands of New Taiwan Dollars, Unless Specified Otherwise) 1. GENERAL Taiwan Semiconductor Manufacturing Company Limited (the “Company” or “TSMC”), a Republic of China (R.O.C.) corporation, was incorporated on February 21, 1987. The Company is a dedicated foundry in the semiconductor industry which engages mainly in the manufacturing, selling, packaging, testing and computer-aided design of integrated circuits and other semiconductor devices and the manufacturing of masks. On September 5, 1994, the Company’s shares were listed on the Taiwan Stock Exchange (TWSE). On October 8, 1997, the Company listed some of its shares of stock on the New York Stock Exchange (NYSE) in the form of American Depositary Shares (ADSs). The address of its registered office and principal place of business is No. 8, Li-Hsin Rd. 6, Hsinchu Science Park, Taiwan. 2. THE AUTHORIZATION OF FINANCIAL STATEMENTS The accompanying parent company only financial statements were approved and authorized for issue by the Board of Directors on February 13, 2018. 3. APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS a. Initial application of the amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) (collectively, “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC) Except for the following, the initial application of the amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the IFRSs endorsed and issued into effect by the FSC did not have a significant effect on the Company’s accounting policies: 1) Amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers The amendments stipulate that other companies or institutions of which the chairman of the board of directors or president serves as the chairman of the board of directors or the president, or is the spouse or second immediate family of the chairman of the board of directors or president of the Company are deemed to have a substantive related party relationship, unless it can be demonstrated that no control, joint control, or significant influence exists. Furthermore, the amendments require the disclosure of the names of the related parties and the relationship with whom the Company has transaction. If the transaction or balance with a specific related party is 10% or more of the Company’s respective total transaction or balance, such transaction should be separately disclosed by the name of each related party. When the amendments are applied retrospectively from January 1, 2017, the disclosure of related party transactions is enhanced, please refer to Note 32. - 109 - - 109 - b. The IFRSs issued by International Accounting Standards Board (IASB) and endorsed by FSC with effective date starting 2018 New, Revised or Amended Standards and Interpretations Effective Date Issued by IASB Annual Improvements to IFRSs 2014-2016 Cycle Amendment to IFRS 2 “Classification and Measurement of Share-based Note 1 January 1, 2018 Payment Transactions” IFRS 9 “Financial Instruments” Amendments to IFRS 9 and IFRS 7 “Mandatory Effective Date of IFRS 9 January 1, 2018 January 1, 2018 and Transition Disclosure” IFRS 15 “Revenue from Contracts with Customers” Amendment to IFRS 15 “Clarifications to IFRS 15” Amendment to IAS 7 “Disclosure Initiative” Amendment to IAS 12 “Recognition of Deferred Tax Assets for Unrealized Losses” January 1, 2018 January 1, 2018 January 1, 2017 January 1, 2017 IFRIC 22 “Foreign Currency Transactions and Advance Consideration” January 1, 2018 Note 1: The amendment to IFRS 12 is retrospectively applied for annual periods beginning on or after January 1, 2017; the amendment to IAS 28 is retrospectively applied for annual periods beginning on or after January 1, 2018. Except for the following items, the Company believes that the adoption of aforementioned standards or interpretations will not have a significant effect on the Company’s accounting policies. 1) IFRS 9 “Financial Instruments” and related amendments Classification, measurement and impairment of financial assets All recognized financial assets currently in the scope of IAS 39, “Financial Instruments: Recognition and Measurement,” will be subsequently measured at either the amortized cost or the fair value. The classification and measurement requirements in IFRS 9 are stated as follows. The invested equity instruments should be measured at the fair value through profit or loss (FVTPL). However, the entity may irrevocably designate an investment in equity instruments that is not held for trading as measured at fair value through other comprehensive income (FVTOCI). All relevant gains and losses shall be recognized in other comprehensive income, except for dividends which are recognized in profit or loss. No subsequent impairment assessment is required, and the cumulative gain or loss previously recognized in other comprehensive income cannot be reclassified from equity to profit or loss. IFRS 9 adds a new expected loss impairment model to measure the impairment of financial assets. A loss allowance for expected credit losses should be recognized on financial assets measured at amortized cost. If the credit risk on a financial instrument has not increased significantly since initial recognition, the loss allowance for that financial instrument should be measured at an amount equal to 12-month expected credit losses. If the credit risk on a financial instrument has increased significantly since initial recognition and is not deemed to be a low credit risk, the loss allowance for that financial instrument should be measured at an amount equal to the lifetime expected credit losses. A simplified approach is allowed for accounts receivables and the loss allowance could be measured at an amount equal to lifetime expected credit losses. - 110 - - 110 - The Company elects not to restate prior reporting period when applying the requirements for the classification, measurement and impairment of financial assets and financial liabilities under IFRS 9 with the cumulative effect of the initial application recognized at the date of initial application. The anticipated impact on measurement categories, carrying amount and related reconciliation for each class of the Company’s financial assets and financial liabilities when retrospectively applying IFRS 9 on January 1, 2018 is detailed below: Financial Assets IAS 39 IFRS 9 IAS 39 IFRS 9 Note Measurement Category Carrying Amount Loans and receivables Held for trading Hedging instruments Available-for(cid:486)sale Loans and receivables Amortized cost Mandatorily at FVTPL Hedging instruments FVTOCI Amortized cost $ 239,176,841 $ 239,176,841 373,351 7,378 3,377,145 123,199,044 123,443,817 373,351 7,378 2,808,606 (1) (2) (1) Held for(cid:3)trading Hedging instruments Amortized cost Mandatorily at FVTPL Hedging instruments Amortized cost 18,764 15,562 294,856,247 294,856,247 18,764 15,562 Cash and cash equivalents Derivatives Equity securities Notes and accounts receivable (including related parties), other receivables and refundable deposits Financial Liabilities Derivatives Short-term loans, accounts payable (including related parties), payables to contractors and equipment suppliers, accrued expenses and other current liabilities, bonds payable and guarantee deposits Carrying Amount as of December 31, 2017 (IAS 39) Reclassifi- cations Remea- surements Carrying Amount as of January 1, 2018 (IFRS 9) Retained Earnings Effect on January 1, 2018 Other Equity Effect on January 1, 2018 Note $ 373,351 - $ $ - - $ - - 373,351 - $ $ - - - - - - - 2,808,606 2,808,606 - 568,539 568,539 - 3,377,145 3,377,145 - - - 7,378 362,375,885 362,375,885 - 244,773 244,773 - 362,620,658 362,620,658 7,378 534,270 534,270 - 244,773 244,773 - (2) (1) 34,269 34,269 - - - - Financial Assets FVTPL FVTOCI - Equity instruments Add: From available for sale Amortized cost Add: From loans and receivables Hedging instruments Total $ 380,729 $ 365,184,491 $ 813,312 $ 366,378,532 $ 779,043 $ 34,269 Carrying Amount as of December 31, 2017 (IAS 39) Adjustments Arising from Initial Application Carrying Amount as of January 1, 2018 (IFRS 9) Retained Earnings Effect on January 1, 2018 Other Equity Effect on January 1, 2018 Note Investments accounted for using equity method $ 463,986,364 $ 400,137 $ 464,386,501 $ 745,247 $ (345,110 ) (3) (1) Cash and cash equivalents, notes and accounts receivable (including related parties), other receivables and refundable deposits were classified as loans and receivables under IAS 39 are now classified at amortized cost with assessment of future 12-month or lifetime expected credit loss under IFRS 9. As a result of retrospective application, the adjustments for accounts receivable would result in a decrease in loss of allowance of NT$244,773 thousand and an increase in retained earnings of NT$244,773 thousand on January 1, 2018. - 111 - - 111 - (2) As equity investments that were previously classified as available-for-sale financial assets under IAS 39 are not held for trading, the Company elected to designate all of these investments as at FVTOCI under IFRS 9. As a result, the related other equity-unrealized gain/loss on available-for-sale financial assets of NT$206,015 thousand is reclassified to increase other equity - unrealized gain/loss on financial assets at FVTOCI. As equity investments previously measured at cost under IAS 39 are remeasured at fair value under IFRS 9, the adjustments would result in an increase in financial assets at FVTOCI of NT$568,539 thousand and an increase in other equity-unrealized gain/loss on financial assets at FVTOCI of NT$568,539 thousand on January 1, 2018. For those equity investments previously classified as available-for-sale financial assets (including measured at cost financial assets) under IAS 39, the impairment losses that the Company had recognized have been accumulated in retained earnings. Since these investments were designated as at FVTOCI under IFRS 9 and no impairment assessment is required, the adjustments would result in a decrease in other equity - unrealized gain/loss on financial assets at FVTOCI of NT$534,270 thousand and an increase in retained earnings of NT$534,270 thousand on January 1, 2018. (3) With the retrospective adoption of IFRS 9 by associates accounted for using equity method, the corresponding adjustments made by the Company would result in an increase in investments accounted for using equity method of NT$400,137 thousand, a decrease in other equity- unrealized gain/loss on financial assets at FVTOCI of NT$765,199 thousand, an increase in other equity- unrealized gain/loss on available-for-sale financial assets of NT$420,089 thousand and an increase in retained earnings of NT$745,247 thousand on January 1, 2018. Hedge accounting The main changes in hedge accounting amended the application requirements for hedge accounting to better reflect the entity’s risk management activities. Compared with IAS 39, the main changes include: (1) enhancing types of transactions eligible for hedge accounting, specifically broadening the risks eligible for hedge accounting of non-financial items; (2) changing the way the hedging cost of derivative instruments are accounted for to reduce profit or loss volatility; and (3) replacing retrospective effectiveness assessment with the principle of economic relationship between the hedging instrument and the hedged item. A preliminary assessment of the Company’s current hedging relationships indicates that they will qualify as continuing hedging relationships under IFRS 9. The Company will prospectively apply the requirements for hedge accounting upon initial application of IFRS 9. 2) IFRS 15 “Revenue from Contracts with Customers” and related amendments IFRS 15 establishes principles for recognizing revenue that apply to all contracts with customers, and will supersede IAS 18 “Revenue,” IAS 11 “Construction Contracts,” and a number of revenue-related interpretations. When applying IFRS 15, the Company shall recognize revenue by applying the following steps: Identify the contract with the customer; Identify the performance obligations in the contract; (cid:122) (cid:122) (cid:122) Determine the transaction price; (cid:122) Allocate the transaction price to the performance obligations in the contract; and (cid:122) Recognize revenue when the entity satisfies a performance obligation. - 112 - - 112 - The Company elects only to retrospectively apply IFRS 15 to contracts that were not completed on January 1, 2018 and elects not to restate prior reporting period with the cumulative effect of the initial application recognized at the date of initial application. The anticipated impact on assets, liabilities and equity when retrospectively applying IFRS 15 on January 1, 2018 is detailed below: Carrying Amount as of December 31, 2017 (IAS 18 and revenue-related interpretations) Adjustments Arising from Initial Application Carrying Amount as of January 1, 2018 (IFRS 15) Note Investments accounted for using equity method $ 463,986,364 $ 32,029 $ 464,018,393 (1) Total effect on assets $ 32,029 Provisions - current Accrued expenses and other current liabilities 13,174,825 $ (13,174,825) - (2) 57,686,386 13,174,825 70,861,211 (2) Total effect on liabilities $ - Retained earnings 1,233,362,010 $ 32,029 1,233,394,039 (1) Total effect on equity $ 32,029 (1) Prior to the application of IFRS 15, the Company recognizes revenue based on the accounting treatment of the sales of goods. Under IFRS 15, certain subsidiaries and associates accounted for using equity method will change to recognize revenue over time because customers are deemed to have control over the products when the products are manufactured. As a result, the Company will adjust related investments and equity accordingly. (2) Prior to the application of IFRS 15, the Company recognized the estimation of sales returns and allowance as provisions. Under IFRS 15, the Company recognizes such estimation as refund liability (classified under accrued expenses and other current liabilities). Except for the aforementioned impact, as of the date the accompanying parent company only financial statements were authorized for issue, the Company continues in evaluating the impact on its financial position and financial performance as a result of the initial adoption of the other standards or interpretations. The related impact will be disclosed when the Company completes the evaluation. c. The IFRSs issued by IASB but not yet endorsed and issued into effect by FSC New, Revised or Amended Standards and Interpretations Effective Date Issued by IASB Annual Improvements to IFRSs 2015-2017 Cycle Amendments to IFRS 9 “Prepayment Features with Negative January 1, 2019 January 1, 2019 Compensation” Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets To be determined by IASB between an Investor and its Associate or Joint Venture” (Continued) - 113 - - 113 - New, Revised or Amended Standards and Interpretations Effective Date Issued by IASB IFRS 16 “Leases” Amendments to IAS 19 “Plan Amendment, Curtailment or Settlement” Amendments to IAS 28 “Long-term Interests in Associates and Joint January 1, 2019 (Note 2) January 1, 2019 January 1, 2019 Ventures” IFRIC 23 “Uncertainty over Income Tax Treatments” January 1, 2019 (Concluded) Note 2: On December 19, 2017, the FSC announced that IFRS 16 will take effect starting January 1, 2019. Except for the following items, the Company believes that the adoption of aforementioned standards or interpretations will not have a significant effect on the Company’s accounting policies. 1) IFRS 16 “Leases” IFRS 16 sets out the accounting standards for leases that will supersede IAS 17 and a number of related interpretations. Under IFRS 16, if the Company is a lessee, it shall recognize right-of-use assets and lease liabilities for all leases on the parent company only balance sheets except for low-value and short-term leases. The Company may elect to apply the accounting method similar to the accounting for operating lease under IAS 17 to the low-value and short-term leases. On the parent company only statements of comprehensive income, the Company should present the depreciation expense charged on the right-of-use asset separately from interest expense accrued on the lease liability; interest is computed by using effective interest method. On the parent company only statements of cash flows, cash payments for both the principal and interest portion of the lease liability are classified within financing activities. When IFRS 16 becomes effective, the Company may elect to apply this Standard either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of the initial application of this Standard recognized at the date of initial application. Except for the aforementioned impact, as of the date the accompanying parent company only financial statements were authorized for issue, the Company continues in evaluating the impact on its financial position and financial performance as a result of the initial adoption of the other standards or interpretations. The related impact will be disclosed when the Company completes the evaluation. 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES For the convenience of readers, the accompanying parent company only financial statements have been translated into English from the original Chinese version prepared and used in the R.O.C. 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 parent company only financial statements shall prevail. Statement of Compliance The accompanying parent company only financial statements have been prepared in conformity with the Regulations Governing the Preparation of Financial Reports by Securities Issuers (the “Accounting Standards Used in Preparation of the Parent Company Only Financial Statements”). - 114 - - 114 - Basis of Preparation The accompanying parent company only financial statements have been prepared on the historical cost basis except for financial instruments that are measured at fair values, as explained in the accounting policies below. Historical cost is generally based on the fair value of the consideration given in exchange for the assets. When preparing the parent company only financial statements, the Company account for subsidiaries and associates by using the equity method. In order to agree with the amount of net income, other comprehensive income and equity attributable to shareholders of the parent in the consolidated financial statements, the differences of the accounting treatment between the parent company only basis and the consolidated basis are adjusted under the heading of investments accounted for using equity method, share of profits of subsidiaries and associates and share of other comprehensive income of subsidiaries and associates in the parent company only financial statements. Foreign Currencies In preparing the parent company only financial statements, transactions in currencies other than the entity’s functional currency (foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Such exchange differences are recognized in profit or loss in the year in which they arise. Non-monetary items measured at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Exchange differences arising on the retranslation of non-monetary items are included in profit or loss for the year except for exchange differences arising on the retranslation of non-monetary items in respect of which gains and losses are recognized directly in other comprehensive income, in which case, the exchange differences are also recognized directly in other comprehensive income. Non-monetary items that are measured in terms of historical cost in foreign currencies are not retranslated. For the purposes of presenting parent company only financial statements, the assets and liabilities of the Company’s foreign operations are translated into NT$ using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period. Exchange differences arising, if any, are recognized in other comprehensive income and accumulated in equity. Classification of Current and Noncurrent Assets and Liabilities Current assets are assets held for trading purposes and assets expected to be converted to cash, sold or consumed within one year from the end of the reporting period. Current liabilities are obligations incurred for trading purposes and obligations expected to be settled within one year from the end of the reporting period. Assets and liabilities that are not classified as current are noncurrent assets and liabilities, respectively. Cash Equivalents Cash equivalents, for the purpose of meeting short-term cash commitments, consist of highly liquid time deposits and investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Financial Instruments Financial assets and liabilities shall be recognized when the Company becomes a party to the contractual provisions of the instruments. - 115 - - 115 - Financial assets and liabilities are initially recognized at fair values. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss. Financial Assets Financial assets are classified into the following specified categories: Financial assets “at FVTPL”, “held-to-maturity” financial assets, “available-for-sale” financial assets and “loans and receivables”. The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. Regular way purchases or sales of financial assets are recognized and derecognized on a trade date or settlement date basis for which financial assets were classified in the same way, respectively. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the marketplace. Financial assets at fair value through profit or loss Financial assets are classified as at fair value through profit or loss when the financial asset is either held for trading or it is designated as at fair value through profit or loss. Financial assets at fair value through profit or loss are stated at fair value, with any gains or losses arising on remeasurement recognized in profit or loss. Held-to-maturity financial assets Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturity dates that the Company has the positive intent and ability to hold to maturity. Subsequent to initial recognition, held-to-maturity financial assets are measured at amortized cost using the effective interest method less any impairment. Available-for-sale financial assets Available-for-sale financial assets are non-derivative financial assets that are either designated as available-for-sale or are not classified as (a) loans and receivables, (b) held-to-maturity financial assets or (c) financial assets at fair value through profit or loss. Available-for-sale financial assets are measured at fair value. Interest income from available-for-sale monetary financial assets and dividends on available-for-sale equity investments are recognized in profit or loss. Other changes in the carrying amount of available-for-sale financial assets are recognized in other comprehensive income. When the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously recognized in other comprehensive income is reclassified to profit or loss. Dividends on available-for-sale equity instruments are recognized in profit or loss when the Company’s right to receive the dividends is established. Available-for-sale equity instruments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured are measured at cost less any identified impairment losses at the end of each reporting period. Such equity instruments are subsequently remeasured at fair value when their fair value can be reliably measured, and the difference between the carrying amount and fair value is recognized in profit or loss or other comprehensive income. - 116 - - 116 - Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Loans and receivables including cash and cash equivalents, notes and accounts receivable and other receivables are measured at amortized cost using the effective interest method, less any impairment, except for those loans and receivables with immaterial discounted effect. Impairment of financial assets Financial assets, other than those carried at FVTPL, are assessed for indicators of impairment at the end of each reporting period. Those financial assets are 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 financial assets, their estimated future cash flows have been affected. For financial assets carried at amortized cost, such as trade receivables, assets that are assessed not to be impaired individually are, in addition, assessed for impairment on a collective basis. The Company assesses the collectability of receivables by performing the account aging analysis and examining current trends in the credit quality of its customers. For financial assets carried at amortized cost, the amount of the impairment loss is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate. For financial assets measured at amortized cost, if, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment loss was recognized, the previously recognized impairment loss is reversed through profit or loss to the extent that the carrying amount of the financial assets at the date the impairment loss is reversed does not exceed what the amortized cost would have been had the impairment loss not been recognized. When an available-for-sale financial asset is considered to be impaired, cumulative gains or losses previously recognized in other comprehensive income are reclassified to profit or loss in the year. In respect of available-for-sale equity instruments, impairment losses previously recognized in profit or loss are not reversed through profit or loss. Any increase in fair value subsequent to the recognition of an impairment loss is recognized in other comprehensive income and accumulated under the heading of unrealized gains or losses from available-for-sale financial assets. For financial assets carried at cost, the amount of the impairment loss is measured as the difference between the asset’s carrying amount and the present value of the estimated future cash flows discounted at the current market rate of return for a similar financial asset. Such impairment loss will not be reversed in subsequent periods. The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables, where the carrying amount is reduced through the use of an allowance account. When a trade receivable is considered uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Derecognition of financial assets The Company derecognizes a financial asset only when the contractual rights to the cash flows from the financial asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the financial asset to another entity. - 117 - - 117 - On derecognition of a financial asset in its entirety, the difference between the financial asset’s carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognized in other comprehensive income and accumulated in equity is recognized in profit or loss. Financial Liabilities and Equity Instruments Classification as debt or equity Debt and equity instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument. Equity instruments An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Company are recognized at the proceeds received, net of direct issue costs. Financial liabilities Financial liabilities are subsequently measured either at amortized cost using effective interest method or at FVTPL. Financial liabilities are classified as at fair value through profit or loss when the financial liability is either held for trading or is designated as at fair value through profit or loss. Financial liabilities at fair value through profit or loss are stated at fair value, with any gains or losses arising on remeasurement recognized in profit or loss. Financial liabilities other than those held for trading purposes and designated as at FVTPL are subsequently measured at amortized cost at the end of each reporting period. Derecognition of financial liabilities The Company derecognizes financial liabilities when, and only when, the Company’s obligations are discharged, cancelled or they expire. The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable is recognized in profit or loss. Derivative Financial Instruments Derivative financial instruments are initially recognized at fair value at the date the derivative contracts are entered into and are subsequently remeasured to their fair value at the end of each reporting period. The resulting gain or loss is recognized in profit or loss immediately unless the derivative financial instrument is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship. Financial Instruments Designated as at Fair Value through Profit or Loss financial instrument may be designated as at FVTPL upon A The financial instrument forms part of a group of financial assets or financial liabilities or both, which is managed and its performance is evaluated on a fair value basis, in accordance with the Company’s documented risk management or investment strategy, and information about the grouping is provided internally on that basis. recognition. initial - 118 - - 118 - Hedge Accounting Cash Flow Hedge The Company designates certain hedging instruments, such as forward exchange contracts, to partially hedge its foreign exchange rate risks associated with certain highly probable forecast transactions, such as capital expenditures. The effective portion of changes in the fair value of hedging instruments is recognized in other comprehensive income. When the forecast transactions actually take place, the associated gains or losses that were recognized in other comprehensive income are removed from equity and included in the initial cost of the hedged items. The gains or losses from hedging instruments relating to the ineffective portion are recognized immediately in profit or loss. Hedge accounting is discontinued prospectively when the Company revokes the designated hedging relationship, or when the hedging instruments expire or are sold, terminated, or exercised, or no longer meet the criteria for hedge accounting. Inventories Inventories are stated at the lower of cost or net realizable value. Inventories are recorded at standard cost and adjusted to approximate weighted-average cost at the end of the reporting period. Net realizable value represents the estimated selling price of inventories less all estimated costs of completion and costs necessary to make the sale. Investments Accounted for Using Equity Method Investments accounted for using the equity method include investments in subsidiaries and associates. Investment in subsidiaries A subsidiary is an entity that is controlled by the Company. Under the equity method, an investment in a subsidiary is initially recognized at cost and adjusted thereafter to recognize the Company’s share of profit or loss and other comprehensive income of the subsidiary as well as the distribution received. The Company also recognized its share in the changes in the equity of subsidiaries. Changes in the Company’s ownership interests in subsidiaries that do not result in the Company losing control over the subsidiaries are accounted for as equity transactions. Any difference between the carrying amount of the subsidiary and the fair value of the consideration paid or received is recognized directly in equity. When the Company loses control of a subsidiary, any retained investment of the former subsidiary is measured at the fair value at that date. A gain or loss is recognized in profit or loss and calculated as the difference between (a) the aggregate of the fair value of consideration received and the fair value of any retained interest at the date when control is lost; and (b) the previous carrying amount of the investments in such subsidiary. In addition, the Company shall account for all amounts previously recognized in other comprehensive income in relation to the subsidiary on the same basis as would be required if the subsidiary had directly disposed of the related assets and liabilities. When the Company transacts with its subsidiaries, profits and losses resulting from the transactions with the subsidiaries are recognized in the Company’s parent company only financial statements only to the extent of interests in the subsidiaries that are not owned by the Company. - 119 - - 119 - Investment in associates An associate is an entity over which the Company has significant influence and that is neither a subsidiary nor a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies. The operating results and assets and liabilities of associates are incorporated in these parent company only financial statements using the equity method of accounting. Under the equity method, an investment in an associate is initially recognized in the statement of financial position at cost and adjusted thereafter to recognize the Company’s share of profit or loss and other comprehensive income of the associate as well as the distribution received. The Company also recognizes its share in the changes in the equities of associates. Any excess of the cost of acquisition over the Company’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities of an associate recognized at the date of acquisition is recognized as goodwill, which is included within the carrying amount of the investment. Any excess of the Company’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition, after reassessment, is recognized immediately in profit or loss. When necessary, the entire carrying amount of the investment (including goodwill) is tested for impairment as a single asset by comparing its recoverable amount (higher of value in use and fair value less costs to sell) with its carrying amount. Any impairment loss recognized forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognized to the extent that the recoverable amount of the investment subsequently increases. The Company discontinues the use of the equity method from the date when the Company ceases to have significant influence over an associate. When the Company retains an interest in the former associate, the Company measures the retained interest at fair value at that date. The difference between the carrying amount of the associate at the date the equity method was discontinued, and the fair value of any retained interest and any proceeds from disposing of a part interest in the associate is included in the determination of the gain or loss on disposal of the associate. In addition, the Company shall account for all amounts recognized in other comprehensive income in relation to that associate on the same basis as would be required if the associate had directly disposed of the related assets or liabilities. If the Company’s ownership interest in an associate is reduced as a result of disposal, but the investment continues to be an associate, the Company should reclassify to profit or loss only a proportionate amount of the gain or loss previously recognized in other comprehensive income. When the Company subscribes to additional shares in an associate at a percentage different from its existing ownership percentage, the resulting carrying amount of the investment differs from the amount of the Company’s proportionate interest in the net assets of the associate. The Company records such a difference as an adjustment to investments with the corresponding amount charged or credited to capital surplus. If the Company’s ownership interest is reduced due to the additional subscription to the shares of associate by other investors, the proportionate amount of the gains or losses previously recognized in other comprehensive income in relation to that associate shall be reclassified to profit or loss on the same basis as would be required if the associate had directly disposed of the related assets or liabilities. When the Company transacts with an associate, profits and losses resulting from the transactions with the associate are recognized in the Company’s parent company only financial statements only to the extent of interests in the associate that are not owned by the Company. Property, Plant and Equipment Property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment. Costs include any incremental costs that are directly attributable to the construction or acquisition of the item of property, plant and equipment. - 120 - - 120 - Properties in the course of construction for production, supply or administrative purposes are carried at cost, less any recognized impairment loss. Such properties are classified to the appropriate categories of property, plant and equipment when completed and ready for intended use. Depreciation of these assets, on the same basis as other property assets, commences when the assets are ready for their intended use. Depreciation is recognized so as to write off the cost of the assets less their residual values over their useful lives, and it is computed using the straight-line method over the following estimated useful lives: buildings - 10 to 20 years; machinery and equipment - 2 to 5 years; and office equipment - 3 to 5 years. The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimates accounted for on a prospective basis. Land is not depreciated. An item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the assets. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss. Leases Leases are classified as finance lease whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases. The Company as lessor Rental income from operating leases is recognized on a straight-line basis over the term of the relevant lease. The Company as lessee Operating lease payments are recognized as an expense on a straight-line basis over the lease term. Intangible Assets Goodwill Goodwill arising on an acquisition of a business is carried at cost as established at the date of acquisition of the business less accumulated impairment losses, if any. Other intangible assets Other separately acquired intangible assets with finite useful lives are carried at cost less accumulated amortization and accumulated impairment losses. Amortization is recognized using the straight-line method over the following estimated useful lives: Technology license fees - the estimated life of the technology or the term of the technology transfer contract; software and system design costs - 3 years or contract period; patent and others - the economic life or contract period. The estimated useful life and amortization method are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. Impairment of Tangible and Intangible Assets Goodwill Goodwill is not amortized and instead is tested for impairment annually, or more frequently when there is an indication that the cash generating unit may be impaired. For the purpose of impairment testing, goodwill is allocated to each of the Company’s cash generating units or groups of cash-generating units that are expected to benefit. If the recoverable amount of a cash generating unit is less than its carrying - 121 - - 121 - amount, the difference is allocated first to reduce the carrying amount of any goodwill allocated to such cash-generating unit and then to the other assets of the cash generating unit pro rata based on the carrying amount of each asset in the cash generating unit. Any impairment loss for goodwill is recognized directly in profit or loss. An impairment loss recognized for goodwill is not reversed in subsequent periods. Other tangible and intangible assets At the end of each reporting period, the Company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. When it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. When a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis can be identified. Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted. If the recoverable amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying amount of the asset or cash-generating unit is reduced to its recoverable amount. An impairment loss is recognized immediately in profit or loss. When an impairment loss subsequently reverses, the carrying amount of the asset or a cash-generating unit is increased to the revised estimate of its recoverable amount, but the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset or cash-generating unit in prior years. A reversal of an impairment loss is recognized immediately in profit or loss. Provision Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that the Company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows. Guarantee Deposit Guarantee deposit mainly consists of cash received under deposit agreements with customers to ensure they have access to the Company’s specified capacity; and as guarantee of accounts receivable to ensure payment from customers. Cash received from customers is recorded as guarantee deposit upon receipt. Guarantee deposits are refunded to customers when terms and conditions set forth in the deposit agreements have been satisfied. - 122 - - 122 - Revenue Recognition Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for estimated customer returns, rebates and other similar allowances. Sale of goods Revenue from the sale of goods is recognized when the goods are delivered and titles have passed, at which time all the following conditions are satisfied: (cid:121) The Company has transferred to the buyer the significant risks and rewards of ownership of the goods; (cid:121) The Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold; (cid:121) The amount of revenue can be measured reliably; (cid:121) (cid:121) The costs incurred or to be incurred in respect of the transaction can be measured reliably. It is probable that the economic benefits associated with the transaction will flow to the Company; and In principle, payment term granted to customers is due 30 days from the invoice date or 30 days from the end of the month of when the invoice is issued. Due to the short term nature of the receivables from sale of goods with the immaterial discounted effect, the Company measures them at the original invoice amounts without discounting. Royalties, dividend and interest income Revenue from royalties is recognized on an accrual basis in accordance with the substance of the relevant agreement, provided that it is probable that the economic benefits will flow to the Company and the amount of revenue can be measured reliably. Dividend income from investments is recognized when the shareholder’s right to receive payment has been established, provided that it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income from a financial asset is recognized when it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable. Employee Benefits Short-term employee benefits Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for service rendered by employees. Retirement benefits For defined contribution retirement benefit plans, payments to the benefit plan are recognized as an expense when the employees have rendered service entitling them to the contribution. For defined benefit retirement benefit plans, the cost of providing benefit is recognized based on actuarial calculations. Defined benefit costs (including service cost, net interest and remeasurement) under the defined benefit retirement benefit plans are determined using the Projected Unit Credit Method. Service cost (including current service cost), and net interest on the net defined benefit liability (asset) are recognized as employee benefits expense in the period they occur. Remeasurement, comprising actuarial gains and losses and the return on plan assets (excluding interest), is recognized in other comprehensive income in the period in which they occur. Remeasurement recognized in other comprehensive income is reflected immediately in retained earnings and will not be reclassified to profit or loss. - 123 - - 123 - Net defined benefit liability represents the actual deficit in the Company’s defined benefit plan. Taxation Income tax expense represents the sum of the tax currently payable and deferred tax. Current tax Income tax on unappropriated earnings is expensed in the year the shareholders approved the appropriation of earnings which is the year subsequent to the year the earnings are generated. Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax provision. Deferred tax Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the parent company only financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences and tax credits for research and development expenses to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized. Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates, except where the Company is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments are only recognized to the extent that it is probable that there will be sufficient taxable profits against which to utilize the benefits of the temporary differences and they are expected to reverse in the foreseeable future. The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the deferred tax asset to be recovered. The deferred tax assets which originally not recognized is also reviewed at the end of each reporting period and recognized to the extent that it is probable that sufficient taxable profits will be available to allow all or part of the deferred tax asset to be recovered. Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the year in which the liability is settled or the asset is realized, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. Current and deferred tax for the year Current and deferred tax are recognized in profit or loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity, respectively. Insurance Claim The Company recognizes insurance claim reimbursement for losses incurred related to disaster damages. Insurance claim reimbursements are recorded, net of any deductible amounts, at the time while there is evidence that the claim reimbursement is virtually certain to be received. - 124 - - 124 -  5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION AND UNCERTAINTY In the application of the aforementioned Company’s accounting policies, the Company is required to make judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which the estimate is revised if the revision affects only that year, or in the year of the revision and future years if the revision affects both current and future years. Revenue Recognition The Company recognizes revenue when the conditions described in Note 4 are satisfied. The Company also records a provision for estimated future returns and other allowances in the same period the related revenue is recorded. Provision for estimated sales returns and other allowances is generally made and adjusted based on historical experience and the consideration of varying contractual terms, and the Company periodically reviews the adequacy of the estimation used. Impairment of Tangible and Intangible Assets Other than Goodwill In the process of evaluating the potential impairment of tangible and intangible assets other than goodwill, the Company is required to make subjective judgments in determining the independent cash flows, useful lives, expected future revenue and expenses related to the specific asset groups with the consideration of the nature of semiconductor industry. Any changes in these estimates based on changed economic conditions or business strategies could result in significant impairment charges or reversal in future years. Impairment of Goodwill The assessment of impairment of goodwill requires the Company to make subjective judgment to determine the identified cash-generating units, allocate the goodwill to relevant cash-generating units and estimate the recoverable amount of relevant cash-generating units. Impairment Assessment on Investment Using Equity Method The Company assesses the impairment of investments accounted for using the equity method whenever triggering events or changes in circumstances indicate that an investment may be impaired and carrying value may not be recoverable. The Company measures the impairment based on a projected future cash flow of the investees, including the underlying assumptions of sales growth rate and capacity utilization rate formulated by such investees’ internal management team. The Company also takes into account market conditions and the relevant industry trends to ensure the reasonableness of such assumptions. Realization of Deferred Income Tax Assets Deferred tax assets are recognized to the extent that it is probable that future taxable profits will be available against which those deferred tax assets can be utilized. Assessment of the realization of the deferred tax assets requires the Company’s subjective judgment and estimate, including the future revenue growth and profitability, tax holidays, the amount of tax credits can be utilized and feasible tax planning strategies. Any changes in the global economic environment, the industry trends and relevant laws and regulations could result in significant adjustments to the deferred tax assets. - 125 - - 125 - Valuation of Inventory Inventories are stated at the lower of cost or net realizable value, and the Company uses judgment and estimate to determine the net realizable value of inventory at the end of each reporting period. Due to the rapid technological changes, the Company estimates the net realizable value of inventory for obsolescence and unmarketable items at the end of reporting period and then writes down the cost of inventories to net realizable value. The net realizable value of the inventory is mainly determined based on assumptions of future demand within a specific time horizon. Recognition and Measurement of Defined Benefit Plans Net defined benefit liability and the resulting defined benefit costs under defined benefit pension plans are calculated using the Projected Unit Credit Method. Actuarial assumptions comprise the discount rate, rate of employee turnover, and future salary increase rate. Changes in economic circumstances and market conditions will affect these assumptions and may have a material impact on the amount of the expense and the liability. 6. CASH AND CASH EQUIVALENTS December 31, 2017 December 31, 2016 Cash and deposits in banks Repurchase agreements collateralized by corporate bonds Commercial paper $ 239,176,841 - - $ 245,520,074 2,361,250 1,997,239 $ 239,176,841 $ 249,878,563 Deposits in banks consisted of highly liquid time deposits that were readily convertible to known amounts of cash and were subject to an insignificant risk of changes in value. 7. FINANCIAL ASSETS AND LIABILITIES AT FAIR VALUE THROUGH PROFIT OR LOSS Financial assets Held for trading Forward exchange contracts Cross currency swap contracts Financial liabilities Held for trading Forward exchange contracts December 31, 2017 December 31, 2016 $ 373,351 - $ 140,094 10,976 $ 373,351 $ 151,070 $ 18,764 $ 62,441 The Company entered into derivative contracts to manage exposures due to fluctuations of foreign exchange rates. These derivative contracts did not meet the criteria for hedge accounting. Therefore, the Company did not apply hedge accounting treatment for these derivative contracts. - 126 - - 126 - Outstanding forward exchange contracts consisted of the following: December 31, 2017 Sell NT$/Buy EUR Sell NT$/Buy JPY Sell US$/Buy NT$ December 31, 2016 Sell NT$/Buy EUR Sell NT$/Buy JPY Sell US$/Buy EUR Sell US$/Buy NT$ Maturity Date Contract Amount (In Thousands) January 2018 to February 2018 February 2018 January 2018 NT$6,002,786/EUR169,000 NT$996,294/JPY3,800,000 US$1,643,000/NT$49,120,205 January 2017 January 2017 January 2017 January 2017 to February 2017 NT$5,393,329/EUR159,400 NT$7,314,841/JPY26,501,800 US$4,180/EUR4,000 US$420,000/NT$13,531,450 Outstanding cross currency swap contracts consisted of the following: Maturity Date December 31, 2016 Contract Amount (In Thousands) Range of Interest Rates Paid Range of Interest Rates Received January 2017 US$170,000/NT$5,487,600 3.98% - 8. HELD-TO-MATURITY FINANCIAL ASSETS Commercial paper Corporate bonds 9. HEDGING DERIVATIVE FINANCIAL INSTRUMENTS Financial assets- current Cash flow hedges Forward exchange contracts Financial liabilities- current Cash flow hedges Forward exchange contracts - 127 - - 127 - December 31, 2016 $ 8,628,176 2,819,362 $ 11,447,538 December 31, 2017 $ 7,378 $ 15,562 The Company entered into forward exchange contracts to partially hedge foreign exchange rate risks associated with certain highly probable forecast transactions, such as capital expenditures. These contracts have maturities of 12 months or less. Outstanding forward exchange contracts consisted of the following: Maturity Date Contract Amount (In Thousands) December 31, 2017 Sell NT$/Buy EUR February 2018 to May 2018 NT$2,649,104/EUR75,000 10. NOTES AND ACCOUNTS RECEIVABLE, NET Notes and accounts receivable Allowance for doubtful receivables December 31, 2017 December 31, 2016 $ 27,124,552 (469,125) $ 40,492,727 (475,430) Notes and accounts receivable, net $ 26,655,427 $ 40,017,297 In principle, the payment term granted to customers is due 30 days from the invoice date or 30 days from the end of the month of when the invoice is issued. The allowance for doubtful receivables is assessed by reference to the collectability of receivables by performing the account aging analysis, historical experience and current financial condition of customers. Except for those impaired, for the rest of the notes and accounts receivable, the account aging analysis at the end of the reporting period is summarized in the following table. There was no impairment concern for the accounts receivable that were past due without recognizing a specific allowance for doubtful receivables since there was no significant change in the credit quality of its customers after the assessment. In addition, the Company’s subsidiary has obtained guarantee of NT$2,427,548 thousand against certain receivables. Aging analysis of notes and accounts receivable, net Neither past due nor impaired Past due but not impaired Past due within 30 days Past due 31-60 days Past due 61-120 days Past due over 121 days December 31, 2017 December 31, 2016 $ 19,632,314 $ 28,511,717 5,169,209 929,672 582,821 341,411 6,755,262 1,693,463 3,056,855 - $ 26,655,427 $ 40,017,297 - 128 - - 128 - Movements of the allowance for doubtful receivables Balance at January 1, 2017 Reversal/Write-off Balance at December 31, 2017 Balance at January 1, 2016 Provision Reversal/Write-off Individually Assessed for Impairment Collectively Assessed for Impairment Total $ $ $ - - - $ 475,430 (6,305) $ 475,430 (6,305) $ 469,125 $ 469,125 8,393 - (8,393) $ 475,109 321 - $ 483,502 321 (8,393) Balance at December 31, 2016 $ - $ 475,430 $ 475,430 11. INVENTORIES Finished goods Work in process Raw materials Supplies and spare parts December 31, 2017 December 31, 2016 $ 9,596,837 52,166,234 6,566,716 1,967,658 $ 8,324,267 32,317,210 3,864,429 1,998,440 $ 70,297,445 $ 46,504,346 Reversal of write-down of inventories resulting from the increase in net realizable value (excluding earthquake losses) and write-down of inventories to net realizable value (excluding earthquake losses) in the amount of NT$878,346 thousand and NT$1,508,452 thousand, respectively, were included in the cost of revenue for the years ended December 31, 2017 and 2016. Please refer to related earthquake losses in Note 35. 12. INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD Investments accounted for using the equity method consisted of the following: Subsidiaries Associates December 31, 2017 December 31, 2016 $ 446,148,086 17,838,278 $ 377,111,820 19,743,888 $ 463,986,364 $ 396,855,708 - 129 - - 129 - a. Investments in subsidiaries Subsidiaries consisted of the following: Subsidiaries Principal Activities Investment activities Manufacturing, selling, testing and computer-aided design of integrated circuits and other semiconductor devices Place of Incorporation and Operation Tortola, British Virgin Islands Shanghai, China Carrying Amount % of Ownership and Voting Rights Held by the Company December 31, December 31, December 31, December 31, 2017 2016 $ 309,211,877 $ 265,634,729 51,060,885 42,618,308 2017 100% 100% 2016 100% 100% TSMC Global Ltd. (TSMC Global) TSMC China Company Limited (TSMC China) TSMC Partners, Ltd. (TSMC Partners) TSMC Nanjing Company Limited (TSMC Nanjing) VisEra Technologies Company Ltd. (VisEra Tech) TSMC Europe B.V. (TSMC Europe) VentureTech Alliance Fund II, L.P. (VTAF II) VentureTech Alliance Fund III, L.P. (VTAF III) TSMC Japan Limited (TSMC Japan) TSMC Korea Limited (TSMC Korea) TSMC Solar Europe GmbH Venture Tech Alliance Holdings, LLC (VTA Holdings) TSMC North America Selling and marketing of Investing in companies involved Tortola, British 49,684,287 51,749,910 100% 100% Virgin Islands Nanjing, China 26,493,740 6,331,094 100% 100% Hsinchu, Taiwan 4,667,162 5,234,883 87% 87% in the design, manufacture, and other related business in the semiconductor industry and other investment activities Manufacturing, selling, testing and computer-aided design of integrated circuits and other semiconductor devices Engaged in manufacturing electronic spare parts and in researching, developing, designing, manufacturing, selling, packaging and testing of color filter integrated circuits and other semiconductor devices Customer service and supporting activities Investing in new start-up technology companies Investing in new start-up technology companies San Jose, California, U.S.A. Amsterdam, the Netherlands Cayman Islands 4,001,003 4,340,303 100% 100% 407,324 353,695 320,533 467,171 100% 98% 100% 98% Cayman Islands 152,836 219,350 98% 98% Customer service and supporting Yokohama, Japan 129,446 132,999 activities Customer service and supporting Seoul, Korea 39,210 35,706 activities Selling of solar related products Hamburg, (20,217 ) (6,328 ) and providing customer service Investing in new start-up technology companies Germany Delaware, U.S.A. - - 100% 100% 100% - 100% 100% 100% 7% TSMC Solar Europe GmbH is under liquidation procedures. VTA Holdings completed the liquidation procedures in April 2017. $ 446,148,086 $ 377,111,820 To simplify investment structure, the Company acquired 253,120 thousand shares of VisEra Tech previously held by VisEra Holding Company (VisEra Holding) by NT$4,874,231 thousand in August 2016. The percentage of ownership held by the Company was 87%. Under the investment agreement entered into with the municipal government of Nanjing, China on March 28, 2016, the Company and its subsidiaries will make an investment in Nanjing in the amount of approximately US$3 billion to establish a subsidiary operating a 300mm wafer fab with the capacity of 20,000 12-inch wafers per month, and a design service center. TSMC Nanjing was established in May 2016. In both 2017 and 2016, the Company continually increased its investment in TSMC Nanjing for the amount of NT$21,724,892 thousand and NT$6,435,200 thousand. This project was approved by the Investment Commission, Ministry of Economic Affairs, R.O.C. (MOEA). To lower the hedging cost, in both of 2017 and 2016, the Company continually increased its investment in TSMC Global for the amount of NT$60,683,010 thousand and NT$64,451,983 thousand, respectively. This project was approved by the Investment Commission, MOEA. - 130 - - 130 - b. Investments in associates Associates consisted of the following: Name of Associate Principal Activities Place of Incorporation and Operation Carrying Amount % of Ownership and Voting Rights Held by the Company December 31, December 31, December 31, December 31, 2017 2016 2017 2016 28% Vanguard International Manufacturing, selling, Hsinchu, Taiwan $ 8,568,344 $ 8,806,384 28% Semiconductor Corporation (VIS) Systems on Silicon Manufacturing Company Pte Ltd. (SSMC) packaging, testing and computer-aided design of integrated circuits and other semiconductor devices and the manufacturing and design service of masks Manufacturing and selling of Singapore 5,677,640 7,163,516 39% 39% integrated circuits and other semiconductor devices Xintec Inc. (Xintec) Wafer level chip size packaging Taoyuan, Taiwan 2,292,100 2,599,807 41% 41% and wafer level post passivation interconnection service Global Unichip Researching, developing, Hsinchu, Taiwan 1,300,194 1,174,181 35% 35% Corporation (GUC) manufacturing, testing and marketing of integrated circuits $ 17,838,278 $ 19,743,888 Starting June 2016, the Company has no longer served as Motech’s board of director. As a result, the Company exercises no significant influence over Motech. Therefore, Motech is no longer accounted for using the equity method. Further, such investment was reclassified to available-for-sale financial assets and the Company recognized a disposal loss of NT$259,960 thousand. To simplify investment structure, the Company acquired 18,504 thousand shares of Xintec previously held by VisEra Holding by NT$445,012 thousand in August 2016. The percentage of ownership held by the Company increased to 41.4%. As of December 31, 2017, no investments in associates are individually material to the Company. As of December 31, 2016, the summarized financial information in respect of each of the Company’s material associates is set out below. The summarized financial information below represents amounts shown in the associate’s financial statements prepared in accordance with the Accounting Standards Used in Preparation of the Parent Company Only Financial Statements, which is adjusted by the Company using the equity method of accounting. 1) VIS Current assets Noncurrent assets Current liabilities Noncurrent liabilities Net revenue Income from operations Net income Other comprehensive income Total comprehensive income Cash dividends received - 131 - - 131 - December 31, 2016 $ 25,662,921 $ 9,501,442 $ 5,476,672 804,107 $ Year Ended December 31, 2016 $ 25,828,634 $ 6,083,625 $ 5,520,645 $ 5,592 $ 5,526,237 $ 1,206,981 Reconciliation of the above summarized financial information to the carrying amount of the interest in the associate was as follows: Net assets Percentage of ownership The Company’s share of net assets of the associate Goodwill Carrying amount of the investment 2) SSMC Current assets Noncurrent assets Current liabilities Noncurrent liabilities Net revenue Income from operations Net income Total comprehensive income Cash dividends received December 31, 2016 $ 28,883,584 28% 8,179,830 626,554 $ 8,806,384 December 31, 2016 $ 14,585,150 $ 5,360,076 $ 1,746,602 286,340 $ Year Ended December 31, 2016 $ 14,045,927 $ 4,921,735 $ 4,918,140 $ 4,918,140 $ 4,076,170 Reconciliation of the above summarized financial information to the carrying amount of the interest in the associate was as follows: Net assets Percentage of ownership The Company’s share of net assets of the associate Goodwill Other adjustments Carrying amount of the investment December 31, 2016 $ 17,912,284 39% 6,948,175 213,984 1,357 $ 7,163,516 - 132 - - 132 - Aggregate information of associates that are not individually material was summarized as follows: The Company’s share of profits of associates The Company’s share of other comprehensive loss of associates The Company’s share of total comprehensive income of associates Year Ended December 31, 2016 $ 42,457 $ (17,777) $ 24,680 The market prices of the investments accounted for using the equity method in publicly traded stocks calculated by the closing price at the end of the reporting period are summarized as follows. The closing price represents the quoted price in active markets, the level 1 fair value measurement. Name of Associate VIS GUC Xintec 13. PROPERTY, PLANT AND EQUIPMENT December 31, 2017 December 31, 2016 $ 30,638,751 $ 11,905,404 $ 9,180,759 $ 26,089,360 $ 3,664,997 $ 3,622,227 Land Buildings Machinery and Equipment Office Equipment Equipment under Installation and Construction in Progress Total Cost Balance at January 1, 2017 Additions (Deductions) Disposals or retirements $ 3,212,000 - - $ 281,936,412 75,491,595 (36,957 ) $ 1,960,457,480 458,690,837 (49,921,595 ) $ 31,830,657 7,888,336 (315,776 ) $ 384,197,526 (239,420,648 ) - $ 2,661,634,075 302,650,120 (50,274,328 ) Balance at December 31, 2017 $ 3,212,000 $ 357,391,050 $ 2,369,226,722 $ 39,403,217 $ 144,776,878 $ 2,914,009,867 Accumulated depreciation and impairment Balance at January 1, 2017 Additions Disposals or retirements $ Balance at December 31, 2017 $ - - - - $ 156,854,513 19,798,087 (28,816 ) $ 1,504,061,808 226,251,816 (34,831,423 ) $ $ 21,316,417 4,547,232 (315,737 ) $ 176,623,784 $ 1,695,482,201 $ 25,547,912 $ - - - - $ 1,682,232,738 250,597,135 (35,175,976 ) $ 1,897,653,897 Carrying amounts at December 31, 2017 $ 3,212,000 $ 180,767,266 $ 673,744,521 $ 13,855,305 $ 144,776,878 $ 1,016,355,970 Cost Balance at January 1, 2016 Additions Disposals or retirements $ 3,212,000 - - $ 272,949,721 9,000,012 (13,321 ) $ 1,807,955,631 155,226,807 (2,724,958 ) $ 27,809,576 4,264,166 (243,085 ) $ 191,052,758 193,144,768 - $ 2,302,979,686 361,635,753 (2,981,364 ) Balance at December 31, 2016 $ 3,212,000 $ 281,936,412 $ 1,960,457,480 $ 31,830,657 $ 384,197,526 $ 2,661,634,075 Accumulated depreciation and impairment Balance at January 1, 2016 Additions Disposals or retirements $ Balance at December 31, 2016 $ - - - - $ 140,493,396 16,368,395 (7,278 ) $ 1,313,095,298 193,655,507 (2,688,997 ) $ $ 17,606,080 3,953,422 (243,085 ) $ 156,854,513 $ 1,504,061,808 $ 21,316,417 $ - - - - $ 1,471,194,774 213,977,324 (2,939,360 ) $ 1,682,232,738 Carrying amounts at December 31, 2016 $ 3,212,000 $ 125,081,899 $ 456,395,672 $ 10,514,240 $ 384,197,526 $ 979,401,337 The significant part of the Company’s buildings includes main plants, mechanical and electrical power equipment and clean rooms, and the related depreciation is calculated using the estimated useful lives of 20 years, 10 years and 10 years, respectively. - 133 - - 133 - 14. INTANGIBLE ASSETS Cost Goodwill Technology License Fees Software and System Design Costs Patent and Others Total Balance at January 1, 2017 Additions $ 1,567,756 - $ 9,490,320 897,855 $ 22,063,589 2,900,120 $ 5,241,203 349,189 $ 38,362,868 4,147,164 Balance at December 31, 2017 $ 1,567,756 $ 10,388,175 $ 24,963,709 $ 5,590,392 $ 42,510,032 Accumulated amortization and impairment Balance at January 1, 2017 Additions Balance at December 31, 2017 Carrying amounts at December 31, 2017 Cost Balance at January 1, 2016 Additions Retirements $ $ $ $ - - - $ 6,091,513 1,548,262 $ 17,991,500 2,290,957 $ 4,231,864 485,809 $ 28,314,877 4,325,028 $ 7,639,775 $ 20,282,457 $ 4,717,673 $ 32,639,905 1,567,756 $ 2,748,400 $ 4,681,252 $ 872,719 $ 9,870,127 $ 1,567,756 - - 8,399,059 1,091,261 - $ 19,297,534 2,770,842 $ (4,787 ) 4,722,667 518,536 - $ 33,987,016 4,380,639 (4,787 ) Balance at December 31, 2016 $ 1,567,756 $ 9,490,320 $ 22,063,589 $ 5,241,203 $ 38,362,868 Accumulated amortization and impairment Balance at January 1, 2016 Additions Retirements Balance at December 31, 2016 Carrying amounts at December 31, 2016 $ $ $ - - - - $ 4,724,143 1,367,370 - $ 16,279,451 1,716,836 $ (4,787 ) 3,592,004 639,860 - $ 24,595,598 3,724,066 (4,787 ) $ 6,091,513 $ 17,991,500 $ 4,231,864 $ 28,314,877 1,567,756 $ 3,398,807 $ 4,072,089 $ 1,009,339 $ 10,047,991 The Company’s goodwill has been tested for impairment at the end of the annual reporting period and the recoverable amount is determined based on the value in use. The value in use was calculated based on the cash flow forecast from the financial budgets covering the future five-year period, and the Company used annual discount rates of 8.5% and 8.4% in its test of impairment as of December 31, 2017 and 2016, respectively, to reflect the relevant specific risk in the cash-generating unit. For the years ended December 31, 2017 and 2016, the Company did not recognize any impairment loss on goodwill. 15. OTHER ASSETS Tax receivable Prepaid expenses Others December 31, 2017 December 31, 2016 $ 1,992,258 492,247 287 $ 2,182,159 821,648 855 $ 2,484,792 $ 3,004,662 - 134 - - 134 - 16. SHORT-TERM LOANS Unsecured loans Amount Original loan content US$ (in thousands) Annual interest rate Maturity date 17. PROVISIONS December 31, 2017 December 31, 2016 $ 63,766,850 $ 57,958,200 $ 2,150,000 1.54%-1.82% Due by February 2018 $ 1,800,000 0.87%-1.07% Due by January 2017 The Company’s current provisions were provisions for sales returns and allowances. Year ended December 31, 2017 Balance, beginning of year Provision Payment Balance, end of year Year ended December 31, 2016 Balance, beginning of year Provision Payment Balance, end of year Sales Returns and Allowances $ 16,991,612 44,244,876 (48,061,663) $ 13,174,825 $ 9,011,863 35,699,912 (27,720,163) $ 16,991,612 Provisions for sales returns and allowances are estimated based on historical experience and the consideration of varying contractual terms, and are recognized as a reduction of revenue in the same year of the related product sales. 18. BONDS PAYABLE Domestic unsecured bonds Less: Current portion December 31, 2017 December 31, 2016 $ 116,100,000 (24,300,000) $ 154,200,000 (38,100,000) $ 91,800,000 $ 116,100,000 - 135 - - 135 - The major terms of domestic unsecured bonds are as follows: Issuance Tranche Issuance Period Total Amount Coupon Rate Repayment and Interest Payment 100-1 100-2 101-1 101-2 101-3 101-4 102-1 102-2 102-3 102-4 A B A B A B A B - A B C A B C A B A B A B September 2011 to September 2016 September 2011 to September 2018 January 2012 to January 2017 January 2012 to January 2019 August 2012 to August 2017 August 2012 to August 2019 September 2012 to September 2017 September 2012 to September 2019 October 2012 to October 2022 January 2013 to January 2018 January 2013 to January 2020 January 2013 to January 2023 February 2013 to February 2018 February 2013 to February 2020 February 2013 to February 2023 $ 10,500,000 1.40% Bullet repayment; interest payable annually 7,500,000 1.63% The same as above 10,000,000 1.29% The same as above 7,000,000 1.46% The same as above 9,900,000 1.28% The same as above 9,000,000 1.40% The same as above 12,700,000 1.28% The same as above 9,000,000 1.39% The same as above 4,400,000 1.53% The same as above 10,600,000 1.23% The same as above 10,000,000 1.35% The same as above 3,000,000 1.49% The same as above 6,200,000 1.23% The same as above 11,600,000 1.38% The same as above 3,600,000 1.50% The same as above July 2013 to July 2020 10,200,000 3,500,000 July 2013 to July 2023 4,000,000 August 2013 to August 2017 August 2013 to August 2019 September 2013 to September 2016 September 2013 to September 2017 1,500,000 1,500,000 8,500,000 1.50% 1.70% 1.34% The same as above The same as above The same as above 1.52% The same as above 1.35% The same as above 1.45% The same as above (Continued) - 136 - - 136 - Issuance Tranche Issuance Period Total Amount Coupon Rate Repayment and Interest Payment 102-4 C September 2013 to March 2019 $ 1,400,000 1.60% Bullet repayment; interest payable annually (interest for the six months prior to maturity will accrue on the basis of actual days and be repayable at maturity) D E F September 2013 to March 2021 September 2013 to March 2023 September 2013 to September 2023 2,600,000 1.85% The same as above 5,400,000 2.05% The same as above 2,600,000 2.10% Bullet repayment; interest payable annually (Concluded) 19. RETIREMENT BENEFIT PLANS a. Defined contribution plans The plan under the R.O.C. Labor Pension Act (the “Act”) is deemed a defined contribution plan. Pursuant to the Act, the Company has made monthly contributions equal to 6% of each employee’s monthly salary to employees’ pension accounts. Accordingly, the Company recognized expenses of NT$1,905,444 thousand and NT$1,735,492 thousand for the years ended December 31, 2017 and 2016, respectively. b. Defined benefit plans The Company has defined benefit plans under the R.O.C. Labor Standards Law that provide benefits based on an employee’s length of service and average monthly salary for the six-month period prior to retirement. The Company contributes an amount equal to 2% of salaries paid each month to their respective pension funds (the Funds), which are administered by the Labor Pension Fund Supervisory Committee (the Committee) and deposited in the Committee’s name in the Bank of Taiwan. Before the end of each year, the Company assesses the balance in the Funds. If the amount of the balance in the Funds is inadequate to pay retirement benefits for employees who conform to retirement requirements in the next year, the Company is required to fund the difference in one appropriation that should be made before the end of March of the next year. The Funds are operated and managed by the government’s designated authorities; as such, the Company does not have any right to intervene in the investments of the Funds. - 137 - - 137 - Amounts recognized in respect of these defined benefit plans were as follows: Current service cost Net interest expense Components of defined benefit costs recognized in profit or loss Remeasurement on the net defined benefit liability: Return on plan assets (excluding amounts included in net interest expense) Actuarial loss arising from experience adjustments Actuarial loss(gain) arising from changes in financial assumptions Actuarial loss arising from changes in demographic assumptions Components of defined benefit costs recognized in other comprehensive income Years Ended December 31 2017 2016 $ $ 145,026 126,525 271,551 132,786 139,355 272,141 29,290 483,846 45,721 38,195 (258,455) 694,632 - 278,672 254,681 1,057,220 Total $ 526,232 $ 1,329,361 The pension costs of the aforementioned defined benefit plans were recognized in profit or loss by the following categories: Cost of revenue Research and development expenses General and administrative expenses Marketing expenses Years Ended December 31 2017 2016 $ 175,357 75,340 16,669 4,185 $ 176,977 73,395 17,367 4,402 $ 271,551 $ 272,141 The amounts arising from the defined benefit obligation of the Company were as follows: December 31, 2017 December 31, 2016 Present value of defined benefit obligation Fair value of plan assets $ 12,774,593 (3,923,889) $ 12,480,480 (3,929,072) Net defined benefit liability $ 8,850,704 $ 8,551,408 - 138 - - 138 - Movements in the present value of the defined benefit obligation were as follows: Balance, beginning of year Current service cost Interest expense Remeasurement losses (gains): Actuarial loss arising from experience adjustments Actuarial loss (gain) arising from changes in financial assumptions Actuarial loss arising from changes in demographic assumptions Benefits paid from plan assets Years Ended December 31 2017 2016 $ 12,480,480 145,026 185,561 $ 11,318,174 132,786 212,909 483,846 38,195 (258,455) 694,632 - (261,865) 278,672 (194,888) Balance, end of year $ 12,774,593 $ 12,480,480 Movements in the fair value of the plan assets were as follows: Balance, beginning of year Interest income Remeasurement losses: Years Ended December 31 2017 2016 $ 3,929,072 59,036 $ 3,870,148 73,554 Return on plan assets (excluding amounts included in net interest expense) Contributions from employer Benefits paid from plan assets (29,290) 226,936 (261,865) (45,721) 225,979 (194,888) Balance, end of year $ 3,923,889 $ 3,929,072 The fair value of the plan assets by major categories at the end of reporting period was as follows: Cash Equity instruments Debt instruments December 31, 2017 December 31, 2016 $ 707,477 1,993,336 1,223,076 $ 818,426 1,852,950 1,257,696 $ 3,923,889 $ 3,929,072 The actuarial valuations of the present value of the defined benefit obligation were carried out by qualified actuaries. The principal assumptions of the actuarial valuation were as follows: Measurement Date December 31, 2017 December 31, 2016 1.65% 3.00% 1.50% 3.00% Discount rate Future salary increase rate - 139 - - 139 - Through the defined benefit plans under the R.O.C. Labor Standards Law, the Company is exposed to the following risks: 1) Investment risk: The pension funds are invested in equity and debt securities, bank deposits, etc. The investment is conducted at the discretion of the government’s designated authorities or under the mandated management. However, under the R.O.C. Labor Standards Law, the rate of return on assets shall not be less than the average interest rate on a two-year time deposit published by the local banks and the government is responsible for any shortfall in the event that the rate of return is less than the required rate of return. 2) Interest risk: A decrease in the government bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the debt investments of the plan assets. Assuming a hypothetical decrease in interest rate at the end of the reporting period contributed to a decrease of 0.5% in the discount rate and all other assumptions were held constant, the present value of the defined benefit obligation would increase by NT$890,116 thousand and NT$970,282 thousand as of December 31, 2017 and 2016, respectively. 3) Salary risk: The present value of the defined benefit obligation is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the present value of the defined benefit obligation. Assuming the expected salary rate increases by 0.5% at the end of the reporting period and all other assumptions were held constant, the present value of the defined benefit obligation would increase by NT$873,801 thousand and NT$951,424 thousand as of December 31, 2017 and 2016, respectively. The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated. Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability. The Company expects to make contributions of NT$233,745 thousand to the defined benefit plans in the next year starting from December 31, 2017. The weighted average duration of the defined benefit obligation is 13 years. 20. GUARANTEE DEPOSITS Capacity guarantee Others Current portion (classified under accrued expenses and other current liabilities) Noncurrent portion - 140 - - 140 - December 31, 2017 December 31, 2016 $ 13,346,550 282,572 $ 20,929,350 176,992 $ 13,629,122 $ 21,106,342 $ 6,046,643 7,582,479 $ 6,439,800 14,666,542 $ 13,629,122 $ 21,106,342 Some of guarantee deposits were refunded to customers by offsetting related accounts receivable. 21. EQUITY a. Capital stock Authorized shares (in thousands) Authorized capital Issued and paid shares (in thousands) Issued capital December 31, 2017 December 31, 2016 28,050,000 $ 280,500,000 25,930,380 $ 259,303,805 28,050,000 $ 280,500,000 25,930,380 $ 259,303,805 A holder of issued common shares with par value of NT$10 per share is entitled to vote and to receive dividends. The authorized shares include 500,000 thousand shares allocated for the exercise of employee stock options. As of December 31, 2017, 1,068,165 thousand ADSs of the Company were traded on the NYSE. The number of common shares represented by the ADSs was 5,340,823 thousand shares (one ADS represents five common shares). b. Capital surplus Additional paid-in capital From merger From convertible bonds From share of changes in equities of subsidiaries From share of changes in equities of associates Donations December 31, 2017 December 31, 2016 $ 24,184,939 22,804,510 8,892,847 118,792 289,240 19,208 $ 24,184,939 22,804,510 8,892,847 107,798 282,155 55 $ 56,309,536 $ 56,272,304 Under the relevant laws, the capital surplus generated from donations and the excess of the issuance price over the par value of capital stock (including the stock issued for new capital, mergers and convertible bonds) may be used to offset a deficit; in addition, when the Company has no deficit, such capital surplus may be distributed as cash dividends or stock dividends up to a certain percentage of the Company’s paid-in capital. The capital surplus from share of changes in equities of subsidiaries and associates and dividend of a claim extinguished by a prescription may be used to offset a deficit; however, when generated from issuance of restricted shares for employees, such capital surplus may not be used for any purpose. c. Retained earnings and dividend policy In accordance with the amendments to the R.O.C. Company Act in May 2015, the recipients of dividends and bonuses are limited to shareholders and do not include employees. The amendments to the Company’s Articles of Incorporation on earnings distribution policy had been approved by the Company’s shareholders in its meeting held on June 7, 2016. For policy about the profit sharing bonus to employees, please refer to Note 29. - 141 - - 141 - The Company’s amended Articles of Incorporation provide that, when allocating the net profits for each fiscal year, the Company shall first offset its losses in previous years and then set aside the following items accordingly: 1) Legal capital reserve at 10% of the profits left over, until the accumulated legal capital reserve equals the Company’s paid-in capital; 2) Special capital reserve in accordance with relevant laws or regulations or as requested by the authorities in charge; 3) Any balance left over shall be allocated according to the resolution of the shareholders’ meeting. The Company’s Articles of Incorporation also provide that profits of the Company may be distributed by way of cash dividend and/or stock dividend. However, distribution of earnings shall be made preferably by way of cash dividend. Distribution of earnings may also be made by way of stock dividend; provided that the ratio for stock dividend shall not exceed 50% of the total distribution. Any appropriations of the profits are subject to shareholders’ approval in the following year. The appropriation for legal capital reserve shall be made until the reserve equals the Company’s paid-in capital. The reserve may be used to offset a deficit, or be distributed as dividends in cash or stocks for the portion in excess of 25% of the paid-in capital if the Company incurs no loss. Pursuant to existing regulations, the Company is required to set aside additional special capital reserve equivalent to the net debit balance of the other components of stockholders’ equity, such as the accumulated balance of foreign currency translation reserve, unrealized valuation gain/loss from available-for-sale financial assets, gain/loss from changes in fair value of hedging instruments in cash flow hedges, etc. For the subsequent decrease in the deduction amount to stockholders’ equity, any special reserve appropriated may be reversed to the extent that the net debit balance reverses. The appropriations of 2016 and 2015 earnings have been approved by the Company’s shareholders in its meetings held on June 8, 2017 and June 7, 2016, respectively. The appropriations and dividends per share were as follows: Appropriation of Earnings For Fiscal For Fiscal Year 2015 Year 2016 Dividends Per Share (NT$) For Fiscal For Fiscal Year 2016 Year 2015 Legal capital reserve Cash dividends to shareholders $ 33,424,718 181,512,663 $ 30,657,384 155,582,283 $7 $6 $ 214,937,381 $ 186,239,667 The Company’s appropriations of earnings for 2017 had been approved in the meeting of the Board of Directors held on February 13, 2018. The appropriations and dividends per share were as follows: Legal capital reserve Special capital reserve Cash dividends to shareholders - 142 - - 142 - Appropriation of Earnings For Fiscal Year 2017 Dividends Per Share (NT$) For Fiscal Year 2017 $ 34,311,148 26,907,527 207,443,044 $ 268,661,719 $ 8 The appropriations of earnings for 2017 are to be presented for approval in the Company’s shareholders’ meeting to be held on June 5, 2018 (expected). Under the Integrated Income Tax System that became effective on January 1, 1998, the R.O.C. resident shareholders are allowed a tax credit for their proportionate share of the income tax paid by the Company on earnings generated since January 1, 1998. d. Others Changes in others were as follows: Year Ended December 31, 2017 Foreign Currency Translation Reserve Unrealized Gain/Loss from Available-for- sale Financial Assets Cash Flow Hedges Reserve Unearned Stock-Based Employee Compensation Total Balance, beginning of year Exchange differences arising on translation of $ 1,661,237 $ 2,641 $ 105 $ - $ 1,663,983 foreign operations (28,270,770 ) - - (28,270,770 ) Changes in fair value of available-for-sale financial assets Cumulative (gain)/loss reclassified to profit or loss upon disposal of available-for-sale financial assets Gain/(loss) arising on changes in the fair value of hedging instruments Transferred to initial carrying amount of hedged items Share of other comprehensive income (loss) of associates Share of unearned stock-based employee compensation of associates Income tax effect - - - (310,002 ) (115,690 ) - - - - - - 99,534 (94,851 ) (88,147 ) 211,951 - - - - (2,974 ) - (562 ) (10,290 ) - - - - - - (310,002 ) (115,690 ) 99,534 (94,851 ) 123,804 (10,290 ) (3,536 ) Balance, end of year $ (26,697,680 ) $ (214,074 ) $ 4,226 $ (10,290 ) $ 26,917,818 Foreign Currency Translation Reserve Year Ended December 31, 2016 Unrealized Gain/Loss from Available-for- sale Financial Assets Cash Flow Hedges Reserve Total Balance, beginning of year Exchange differences arising on $ 11,039,949 $ 734,771 $ (607) $ 11,774,113 translation of foreign operations (9,439,776) - Changes in fair value of available-for-sale financial assets Cumulative gain reclassified to profit or loss upon disposal of available-for-sale financial assets Share of other comprehensive income (loss) of subsidiaries and associates Other comprehensive loss reclassified to profit or loss upon disposal of associates Income tax effect - - 148,917 (101,411) - - - (9,439,776) 148,917 (101,411) 65,776 (714,991) 712 (648,503) (4,712) - (3,469) (61,176) - - (8,181) (61,176) Balance, end of year $ 1,661,237 $ 2,641 $ 105 $ 1,663,983 - 143 - - 143 - The aforementioned other equity includes the changes in other equities of the Company and the Company’s share of its subsidiaries and associates. 22. NET REVENUE Net revenue from sale of goods Net revenue from royalties 23. OTHER OPERATING INCOME AND EXPENSES, NET Gain (loss) on disposal or retirement of property, plant and equipment, net Others 24. OTHER INCOME Interest income Bank deposits Held-to-maturity financial assets Dividend income 25. FINANCE COSTS Interest expense Corporate bonds Bank loans Related parties - 144 - - 144 - Years Ended December 31 2017 2016 $ 968,611,860 524,249 $ 935,864,491 522,800 $ 969,136,109 $ 936,387,291 Years Ended December 31 2017 2016 $ (1,008,989) (252,676) $ 100,503 (16,538) $ (1,261,665) $ 83,965 Years Ended December 31 2017 2016 $ 1,522,579 32,213 1,554,792 141,803 $ 1,634,873 48,277 1,683,150 133,653 $ 1,696,595 $ 1,816,803 Years Ended December 31 2017 2016 $ 1,967,750 766,001 15,889 $ 2,353,251 289,942 - $ 2,749,640 $ 2,643,193 26. OTHER GAINS AND LOSSES, NET Gain on disposal of financial assets, net Available-for-sale financial assets Other gains Net gain (loss) on financial instruments at FVTPL Held for trading Designated as at FVTPL Loss on disposal of investments accounted for using equity method, net Impairment loss of financial assets Financial assets carried at cost Other losses 27. INCOME TAX a. Income tax expense recognized in profit or loss Income tax expense consisted of the following: Current income tax expense Current tax expense recognized in the current year Income tax adjustments on prior years Other income tax adjustments Years Ended December 31 2017 2016 $ 115,690 245,483 $ 101,411 125,282 1,252,759 - 899,991 (76,691) - (296,065) (6,137) (15,556) (4,537) (15,291) $ 1,592,239 $ 734,100 Years Ended December 31 2017 2016 $ 55,187,468 (938,292) 150,168 54,399,344 $ 53,577,418 (1,039,175) 168,040 52,706,283 Deferred income tax benefit The origination and reversal of temporary differences (4,194,644) (1,764,503) Income tax expense recognized in profit or loss $ 50,204,700 $ 50,941,780 A reconciliation of income before income tax and income tax expense recognized in profit or loss was as follows: Years Ended December 31 2017 2016 Income before tax $ 393,316,176 $ 385,188,960 Income tax expense at the statutory rate (17%) Tax effect of adjusting items: Nondeductible (deductible) items in determining taxable income Tax-exempt income Additional income tax on unappropriated earnings $ 66,863,750 $ 65,482,123 (1,438,813) (16,467,720) 11,835,948 121,152 (19,075,801) 11,957,213 (Continued) - 145 - - 145 - The origination and reversal of temporary differences Income tax credits Income tax adjustments on prior years Other income tax adjustments Years Ended December 31 2017 2016 $ (4,194,644) $ (5,605,697) 50,992,824 (938,292) 150,168 (1,764,503) (4,907,269) 51,812,915 (1,039,175) 168,040 Income tax expense recognized in profit or loss $ 50,204,700 $ 50,941,780 (Concluded) In January 2018, it was announced that the Income Tax Law in the R.O.C. was amended and, starting from 2018, the corporate income tax rate will be adjusted from 17% to 20%. In addition, the tax rate applicable to unappropriated earnings will be reduced from 10% to 5%. Deferred tax assets and deferred tax liabilities recognized as of December 31, 2017 are expected to be adjusted and would increase by NT$1,464,963 thousand and NT$15,096 thousand, respectively, in 2018. b. Income tax expense recognized in other comprehensive income Deferred income tax benefit (expense) Related to remeasurement of defined benefit obligation Related to unrealized gain/loss on available-for-sale financial assets Related to gain/loss on cash flow hedges Years Ended December 31 2017 2016 $ 30,562 $ 126,867 (2,974) (562) (61,176) - $ 27,026 $ 65,691 c. Deferred income tax balance The analysis of deferred income tax assets and liabilities was as follows: Deferred income tax assets Temporary differences Depreciation Provision for sales returns and allowance Net defined benefit liability Unrealized loss on inventories Others Deferred income tax liabilities Temporary differences Unrealized exchange gains Available-for-sale financial assets Cash flow hedges - 146 - - 146 - December 31, 2017 December 31, 2016 $ 7,668,535 1,580,979 975,324 604,635 - $ 3,284,735 1,428,787 939,543 698,858 94,858 $ 10,829,473 $ 6,446,781 $ (169,480) $ (95,421) (37,304) (48,736) (92,447) - $ (302,205) $ (141,183) Recognized in Balance, Beginning of Year Profit or Loss Other Comprehensive Income Balance, End of Year $ 3,284,735 $ 4,383,800 $ - $ 7,668,535 Net defined benefit liability Unrealized loss on inventories Others 1,428,787 939,543 698,858 94,858 152,192 5,219 (94,223) (94,858) - 30,562 - - 1,580,979 975,324 604,635 - $ 6,446,781 $ 4,352,130 $ 30,562 $ 10,829,473 $ (48,736) $ (120,744) $ - $ (169,480) (92,447) - - (36,742) (2,974) (562) (95,421) (37,304) $ (141,183) $ (157,486) $ (3,536) $ (302,205) $ 1,874,632 $ 1,410,103 $ - $ 3,284,735 Year Ended December 31, 2017 Deferred income tax assets Temporary differences Depreciation Provision for sales returns and allowance Deferred income tax liabilities Temporary differences Unrealized exchange gains Available-for-sale financial assets Cash flow hedges Year Ended December 31, 2016 Deferred income tax assets Temporary differences Depreciation Provision for sales returns and allowance Net defined benefit liability Unrealized loss on inventories Others 1,081,423 895,486 573,243 81,891 347,364 (82,810) 125,615 12,967 - 126,867 - - 1,428,787 939,543 698,858 94,858 $ 4,506,675 $ 1,813,239 $ 126,867 $ 6,446,781 Deferred income tax liabilities Temporary differences Available-for-sale financial assets Unrealized exchange gains $ (31,271) - $ - (48,736) $ (61,176) - $ (92,447) (48,736) $ (31,271) $ (48,736) $ (61,176) $ (141,183) d. The deductible temporary differences for which no deferred income tax assets have been recognized As of December 31, 2017 and 2016, the aggregate deductible temporary differences for which no deferred income tax assets have been recognized amounted to NT$26,536,307 thousand and NT$1,919,784 thousand, respectively. - 147 - - 147 - e. Unused tax-exemption information As of December 31, 2017, the profits generated from the following projects of the Company are exempt from income tax for a five-year period: Construction and expansion of 2007 Construction and expansion of 2008 Construction and expansion of 2009 Tax-exemption Period 2014 to 2018 2015 to 2019 2018 to 2022 f. The information of unrecognized deferred income tax liabilities associated with investments As of December 31, 2017 and 2016, the aggregate taxable temporary differences associated with investments liabilities amounted to NT$95,003,344 thousand and NT$83,181,401 thousand, respectively. in subsidiaries not recognized as deferred income tax g. Integrated income tax information Balance of the Imputation Credit Account December 31, 2017 December 31, 2016 $ 114,264,283 $ 82,072,562 The estimated and actual creditable ratio for distribution of the Company’s earnings of 2017 and 2016 were 14.69% and 13.90%, respectively; while the creditable ratio for individual shareholders residing in the R.O.C. is half of the original creditable ratio according to the R.O.C. Income Tax Law. However, effective from January 1, 2018, integrated income tax system were abrogated and imputation credit account is no longer applicable based on amended R.O.C. Income Tax Law in January 2018. All earnings generated prior to December 31, 1997 have been appropriated. h. Income tax examination The tax authorities have examined income tax returns of the Company through 2014. All investment tax credit adjustments assessed by the tax authorities have been recognized accordingly. 28. EARNINGS PER SHARE Basic EPS Diluted EPS Years Ended December 31 2017 $13.23 $13.23 2016 $12.89 $12.89 - 148 - - 148 - EPS is computed as follows: Year ended December 31, 2017 Basic/Diluted EPS Number of Shares (Denominator) (In Thousands) Amounts (Numerator) EPS (NT$) Net income available to common shareholders $ 343,111,476 25,930,380 $13.23 Year ended December 31, 2016 Basic/Diluted EPS Net income available to common shareholders $ 334,247,180 25,930,380 $12.89 29. ADDITIONAL INFORMATION OF EXPENSES BY NATURE Years Ended December 31 2017 2016 a. Depreciation of property, plant and equipment Recognized in cost of revenue Recognized in operating expenses Recognized in other operating income and expenses $ 231,042,615 19,490,010 64,510 $ 197,595,313 16,357,124 24,887 b. Amortization of intangible assets Recognized in cost of revenue Recognized in operating expenses $ 250,597,135 $ 213,977,324 $ 2,119,899 2,205,129 $ 2,014,814 1,709,252 $ 4,325,028 $ 3,724,066 c. Research and development expenses $ 79,887,723 $ 70,366,179 d. Employee benefits expenses Post-employment benefits Defined contribution plans Defined benefit plans Other employee benefits Employee benefits expense summarized by function Recognized in cost of revenue Recognized in operating expenses - 149 - - 149 - $ $ 1,905,444 271,551 2,176,995 90,611,476 1,735,492 272,141 2,007,633 86,133,216 $ 92,788,471 $ 88,140,849 $ 55,902,877 36,885,594 $ 53,109,947 35,030,902 $ 92,788,471 $ 88,140,849 In accordance with the amendments to the R.O.C. Company Act in May 2015 and the amended the Company’s Articles of Incorporation approved by the Company’s shareholders in its meeting held on June 7, 2016, the Company shall allocate compensation to directors and profit sharing bonus to employees of the Company not more than 0.3% and not less than 1% of annual profits during the period, respectively. The Company accrued profit sharing bonus to employees based on a percentage of net income before income tax, profit sharing bonus to employees and compensation to directors during the period, which amounted to NT$23,019,082 thousand and NT$22,418,339 thousand for the years ended December 31, 2017 and 2016, respectively; compensation to directors was expensed based on estimated amount payable. If there is a change in the proposed amounts after the annual parent company only financial statements are authorized for issue, the differences are recorded as a change in accounting estimate. The Company’s profit sharing bonus to employees and compensation to directors in the amounts of NT$23,019,082 thousand and NT$368,919 thousand in cash for 2017, respectively, and profit sharing bonus to employees and compensation to directors in the amounts of NT$22,418,339 thousand and NT$376,432 thousand in cash for 2016, respectively, had been approved by the Board of Directors of the Company held on February 13, 2018 and February 14, 2017, respectively. There is no significant difference between the aforementioned approved amounts and the amounts charged against earnings of 2017 and 2016, respectively. The Company’s profit sharing bonus to employees and compensation to directors in the amounts of NT$20,556,888 thousand and NT$356,186 thousand in cash for 2015, respectively, had been approved by the Board of Directors on February 2, 2016. The profit sharing bonus to employees and compensation to directors in cash for 2015 had been reported to the Company’s shareholders in its meeting held on June 7, 2016, after the amended the Company’s Articles of Incorporation had been approved. The aforementioned approved amount has no difference with the one recognized in the parent company only financial statements for the year ended December 31, 2015. The information about the appropriations of the Company’s profit sharing bonus to employees and compensation to directors is available at the Market Observation Post System website. 30. CAPITAL MANAGEMENT The Company requires significant amounts of capital to build and expand its production facilities and acquire additional equipment. In consideration of the industry dynamics, the Company manages its capital in a manner to ensure that it has sufficient and necessary financial resources to fund its working capital needs, capital asset purchases, research and development activities, dividend payments, debt service requirements and other business requirements associated with its existing operations over the next 12 months. 31. FINANCIAL INSTRUMENTS a. Categories of financial instruments Financial assets FVTPL Available-for-sale financial assets (Note 1) Held-to-maturity financial assets Hedging derivative financial assets Loans and receivables (Note 2) - 150 - - 150 - December 31, 2017 December 31, 2016 $ 373,351 2,808,606 - 7,378 362,375,885 $ 151,070 3,279,220 11,447,538 - 380,199,491 $ 365,565,220 $ 395,077,319 (Continued) Financial liabilities FVTPL Hedging derivative financial liabilities Amortized cost (Note 3) December 31, 2017 December 31, 2016 $ 18,764 15,562 294,856,247 $ 62,441 - 344,572,867 $ 294,890,573 $ 344,635,308 (Concluded) Note 1: Including financial assets carried at cost. Note 2: Including cash and cash equivalents, notes and accounts receivable (including related parties), other receivables and refundable deposits. Note 3: Including short-term loans, accounts payable (including related parties), payables to contractors and equipment suppliers, accrued expenses and other current liabilities, bonds payable, and guarantee deposits. b. Financial risk management objectives The Company seeks to ensure sufficient cost-efficient funding readily available when needed. The Company manages its exposure to foreign currency risk, interest rate risk, equity price risk, credit risk and liquidity risk with the objective to reduce the potentially adverse effects the market uncertainties may have on its financial performance. The plans for material treasury activities are reviewed by Audit Committees and/or Board of Directors in accordance with procedures required by relevant regulations or internal controls. During the implementation of such plans, Corporate Treasury function must comply with certain treasury procedures that provide guiding principles for overall financial risk management and segregation of duties. c. Market risk The Company is exposed to the financial market risks, primarily changes in foreign currency exchange rates, interest rates and equity investment prices. Foreign currency risk Most of the Company’s operating activities are denominated in foreign currencies. Consequently, the Company is exposed to foreign currency risk. To protect against reductions in value and the volatility of future cash flows caused by changes in foreign exchange rates, the Company utilizes derivative financial instruments, such as forward exchange contracts and cross currency swaps, and non-derivative financial instruments, such as foreign currency-denominated debt, to partially hedge its currency exposure. The Company’s sensitivity analysis of foreign currency risk mainly focuses on the foreign currency monetary items and the derivatives financial instruments at the end of the reporting period. Assuming an unfavorable 10% movement in the levels of foreign exchanges relative to the New Taiwan dollar, the net income for the years ended December 31, 2017 and 2016 would have decreased by NT$849,248 thousand and NT$116,345 thousand, respectively, and the other comprehensive income for the year ended December 31, 2017 would have decreased by NT$265,875 thousand. - 151 - - 151 - Interest rate risk The Company is exposed to interest rate risk primarily related to its outstanding debt at fixed interest rates and investments in fixed income securities. All of the Company’s bonds payable have fixed interest rates and are measured at amortized cost. As such, changes in interest rates would not affect the future cash flows. The Company classified its investments in fixed income securities as held-to-maturity financial assets. Because held-to-maturity fixed income securities are measured at amortized cost, changes in interest rates would not affect the fair value. Other price risk The Company is exposed to equity price risk arising from available-for-sale equity investments. Assuming a hypothetical decrease of 5% in prices of the equity investments at the end of the reporting period for the years ended December 31, 2017 and 2016, the other comprehensive income would have decreased by NT$120,835 thousand and NT$141,570 thousand, respectively. d. Credit risk management Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company is exposed to credit risk from operating activities, primarily trade receivables, and from investing activities, primarily deposits, fixed-income investments and other financial instruments with banks. Credit risk is managed separately for business related and financial related exposures. As of the end of the reporting period, the Company’s maximum credit risk exposure is mainly from the carrying amount of financial assets. Business related credit risk The Company has considerable trade receivables outstanding with its customers worldwide. A substantial majority of the Company’s outstanding trade receivables are not covered by collateral or credit insurance. While the Company has procedures to monitor and limit exposure to credit risk on trade receivables, there can be no assurance such procedures will effectively limit its credit risk and avoid losses. This risk is heightened during periods when economic conditions worsen. As of December 31, 2017 and 2016, the Company’s ten largest customers both accounted for 74% of accounts receivable. The Company believes the concentration of credit risk is not material for the remaining accounts receivable. Financial credit risk The Company regularly monitors and reviews the concentration limit applied to counterparties and adjusts the concentration limit according to market conditions and the credit standing of the counterparties. The Company mitigates its exposure by limiting the exposure to any individual counterparty and by selecting counterparties with investment-grade credit ratings. e. Liquidity risk management The objective of liquidity risk management is to ensure the Company has sufficient liquidity to fund its business requirements associated with existing operations over the next 12 months. The Company liquidity risk by maintaining adequate cash and cash equivalent, short-term manages available-for-sale financial assets and short-term held-to-maturity financial assets. its The table below summarizes the maturity profile of the Company’s financial liabilities based on contractual undiscounted payments, including principal and interest. - 152 - - 152 - Less Than 1 Year 2-3 Years 4-5 Years 5+ Years Total December 31, 2017 Non-derivative financial liabilities Short-term loans Accounts payable (including related $ 63,801,977 $ parties) Payables to contractors and equipment suppliers Accrued expenses and other current liabilities Bonds payable Guarantee deposits (including those classified under accrued expenses and other current liabilities) Derivative financial instruments Forward exchange contracts Outflows Inflows 30,434,887 50,363,976 20,561,411 25,791,842 $ - - - $ - - - - - - $ 63,801,977 30,434,887 50,363,976 - 68,378,787 - 7,777,715 - 18,203,601 20,561,411 120,151,945 6,046,643 197,000,736 7,498,840 75,877,627 83,639 7,861,354 - 18,203,601 13,629,122 298,943,318 48,169,933 (48,530,989 ) (361,056 ) - - - - - - - - - 48,169,933 (48,530,989 ) (361,056 ) $ 196,639,680 $ 75,877,627 $ 7,861,354 $ 18,203,601 $ 298,582,262 December 31, 2016 Non-derivative financial liabilities Short-term loans Accounts payable (including related $ 57,974,562 $ parties) Payables to contractors and equipment suppliers Accrued expenses and other current liabilities Bonds payable Guarantee deposits (including those classified under accrued expenses and other current liabilities) Derivative financial instruments Forward exchange contracts Outflows Inflows Cross currency swap contracts Outflows Inflows 29,373,925 62,449,143 19,485,257 40,067,749 $ - - - $ - - - - - - $ 57,974,562 29,373,925 62,449,143 - 61,831,777 - 35,340,742 - 22,979,426 19,485,257 160,219,694 6,439,800 215,790,436 13,056,592 74,888,369 1,609,950 36,950,692 - 22,979,426 21,106,342 350,608,923 26,366,343 (26,490,320 ) (123,977 ) 5,478,066 (5,487,600 ) (9,534 ) - - - - - - - - - - - - - - - - - - 26,366,343 (26,490,320 ) (123,977 ) 5,478,066 (5,487,600 ) (9,534 ) $ 215,656,925 $ 74,888,369 $ 36,950,692 $ 22,979,426 $ 350,475,412 f. Fair value of financial instruments 1) Fair value measurements recognized in the parent company only balance sheets Fair value measurements are grouped into Levels 1 to 3 based on the degree to which the fair value is observable: (cid:121) Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities; - 153 - - 153 - (cid:121) Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and (cid:121) Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs). 2) Fair value of financial instruments that are measured at fair value on a recurring basis Fair value hierarchy The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis: Level 1 Level 2 Level 3 Total December 31, 2017 Financial assets at FVTPL Held for trading Forward exchange contracts $ - $ 373,351 $ Available-for-sale financial assets Publicly traded stocks $ 2,393,555 $ - $ Hedging derivative financial assets Cash flow hedges Forward exchange contracts $ Financial liabilities at FVTPL Held for trading Forward exchange contracts $ Hedging derivative financial liabilities Cash flow hedges - - $ 7,378 $ $ 18,764 $ - - - - $ 373,351 $ 2,393,555 $ 7,378 $ 18,764 Forward exchange contracts $ - $ 15,562 $ - $ 15,562 Level 1 Level 2 Level 3 Total December 31, 2016 Financial assets at FVTPL Held for trading Forward exchange contracts Cross currency swap contracts Available-for-sale financial assets $ $ - - - $ 140,094 10,976 $ 151,070 $ $ Publicly traded stocks $ 2,843,952 $ - $ Financial liabilities at FVTPL Held for trading Forward exchange contracts $ - $ 62,441 $ - - - - - $ 140,094 10,976 $ 151,070 $ 2,843,952 $ 62,441 There were no transfers between Level 1 and Level 2 for the years ended December 31, 2017 and 2016, respectively. - 154 - - 154 - There were no purchases and disposals for assets classified as Level 3 for the years ended December 31, 2017 and 2016, respectively. Valuation techniques and assumptions used in Level 2 fair value measurement The fair values of financial assets and financial liabilities are determined as follows: (cid:121) Forward exchange contracts and cross currency swap contracts are measured using forward exchange rates and the discounted curves that are derived from quoted market prices. 3) Fair value of financial instruments that are not measured at fair value Except as detailed in the following table, the Company considers that the carrying amounts of financial instruments in the parent company only financial statements that are not measured at fair value approximate their fair values. December 31, 2017 December 31, 2016 Carrying Amount Fair Value Carrying Amount Fair Value Financial assets Held-to-maturity financial assets Commercial paper Corporate bonds Financial liabilities $ $ - - - - $ 8,628,176 2,819,362 $ 8,630,769 2,821,660 Measured at amortized cost Bonds payable 116,100,000 118,020,699 154,200,000 155,930,125 Fair value hierarchy The table below sets out the fair value hierarchy for the Company’s assets and liabilities which are not required to measure at fair value: Level 1 Level 2 Level 3 Total December 31, 2017 Financial liabilities Measured at amortized cost Bonds payable Financial assets Held-to-maturity securities Commercial paper Corporate bonds Financial liabilities Measured at amortized cost Bonds payable $ - $ 118,020,699 $ - $ 118,020,699 Level 1 Level 2 Level 3 Total December 31, 2016 $ $ - - - $ 8,630,769 2,821,660 $ $ 11,452,429 $ - - - $ 8,630,769 2,821,660 $ 11,452,429 $ - $ 155,930,125 $ - $ 155,930,125 - 155 - - 155 - In the fourth quarter of 2017, the Company reassessed the bid-ask spread and the transaction volume of the fixed income securities in determining whether there were quoted prices in active markets. Accordingly, the Company classified the fair value hierarchy levels of corporate bonds and bonds payable as level 2. To have consistent comparative basis, the Company had revised prior year classification from level 1 to level 2. Valuation techniques and assumptions used in Level 2 fair value measurement The fair values of corporate bonds are determined by quoted market prices. The fair value of commercial paper is determined by the present value of future cash flows based on the discounted curves that are derived from the quoted market prices. The fair value of the Company’s bonds payable is determined by quoted market prices. 32. RELATED PARTY TRANSACTIONS The significant transactions between the Company and its related parties, other than those disclosed in other notes, are summarized as follows: a. Related party name and categories Related Party Name Related Party Categories Subsidiaries Subsidiaries Subsidiaries Subsidiaries Subsidiaries Subsidiaries Subsidiaries Subsidiaries Subsidiaries TSMC Global TSMC China TSMC Nanjing VisEra Tech TSMC North America TSMC Europe TSMC Japan TSMC Korea TSMC Solar Europe GmbH TSMC Design Technology Canada Inc. (TSMC Canada) Indirect Subsidiaries Indirect Subsidiaries TSMC Technology, Inc. (TSMC Technology) Indirect Subsidiaries WaferTech, LLC (WaferTech) Associates GUC Associates VIS Associates SSMC Associates Xintec Other related parties TSMC Education and Culture Foundation Other related parties TSMC Charity Foundation - 156 - - 156 - b. Net revenue Item Related Party Name/Categories Years Ended December 31 2017 2016 Net revenue from sale of goods TSMC North America Associates Other subsidiaries Other related parties Item Related Party Categories Net revenue from royalties Associates Subsidiaries c. Purchases Related Party Categories Subsidiaries Associates d. Receivables from related parties $ 650,351,537 6,941,089 487,112 133 $ 633,917,888 5,084,397 5,687 - $ 657,779,871 $ 639,007,972 $ 482,537 264 $ 516,749 355 $ 482,801 $ 517,104 Years Ended December 31 2017 2016 $ 30,843,591 9,903,917 $ 27,788,470 10,107,719 $ 40,747,508 $ 37,896,189 December 31, 2017 December 31, 2016 Item Related Party Name/Categories Receivables from related parties TSMC North America Associates Other subsidiaries $ 91,329,510 777,730 34,597 $ 85,874,678 931,787 39,105 Other receivables from related TSMC Nanjing parties TSMC North America Associates Other subsidiaries $ 92,141,837 $ 86,845,570 $ $ 1,754,484 1,246,101 127,459 15,828 - 800,657 146,621 1,522 $ 3,143,872 $ 948,800 - 157 - - 157 - e. Payables to related parties Item Related Party Name/Categories December 31, 2017 December 31, 2016 Payables to related parties TSMC China WaferTech Xintec VIS SSMC Other subsidiaries Other related parties Other associates f. Disposal of property, plant and equipment Related Party Name/Categories TSMC Nanjing Other subsidiaries Associates Related Party Name/Categories TSMC Nanjing Other subsidiaries Associates Related Party Name/Categories TSMC Nanjing Other subsidiaries - 158 - - 158 - $ 1,440,141 1,328,094 817,876 409,950 406,959 405,127 12,000 9,517 $ 1,775,774 1,303,795 123,586 587,407 505,655 499,679 - 44,105 $ 4,829,664 $ 4,840,001 Proceeds Years Ended December 31 2017 2016 $ 14,336,846 120,790 1,355 $ - 10,622 - $ 14,458,991 $ 10,622 Gains Years Ended December 31 2017 2016 $ 81,272 50,361 1,355 $ - 49,108 - $ 132,988 $ 49,108 Deferred Gains from Disposal of Property, Plant and Equipment December 31, 2016 December 31, 2017 $ 574,633 192,554 - $ 144,689 $ 767,187 $ 144,689 g. Others Years Ended December 31 2017 2016 Item Related Party Name/Categories Manufacturing expenses Associates Subsidiaries Research and development expenses Subsidiaries Associates $ 2,098,141 9,318 $ 1,376,763 15,954 $ 2,107,459 $ 1,392,717 $ 2,205,906 69,841 $ 2,179,813 161,671 $ 2,275,747 $ 2,341,484 Marketing expenses - commission TSMC Europe Other subsidiaries $ 437,561 370,243 $ 451,801 421,316 General and administrative expenses Other related parties Subsidiaries $ 101,500 3,910 $ 60,000 - $ 807,804 $ 873,117 $ 105,410 $ 60,000 The sales prices and payment terms to related parties were not significantly different from those of sales to third parties. For other related party transactions, price and terms were determined in accordance with mutual agreements. The Company leased factory and office from associates. The lease terms and prices were both determined in accordance with mutual agreements. The rental expenses were paid to associates monthly; the related expenses were both classified under manufacturing expenses. The Company deferred the disposal gain/loss derived from sales of property, plant and equipment to related parties using equity method, and then recognized such gain/loss over the depreciable lives of the disposed assets. h. Compensation of key management personnel The compensation to directors and other key management personnel for the years ended December 31, 2017 and 2016 were as follows: Short-term employee benefits Post-employment benefits Years Ended December 31 2017 2016 $ 2,071,171 3,375 $ 1,926,654 3,617 $ 2,074,546 $ 1,930,271 The compensation to directors and other key management personnel were determined by the Compensation Committee of the Company in accordance with the individual performance and the market trends. - 159 - - 159 - 33. SIGNIFICANT OPERATING LEASE ARRANGEMENTS The Company’s major significant operating leases are arrangements on several parcels of land and machinery and equipment. The Company expensed the lease payments as follows: Minimum lease payments $ 1,748,190 $ 815,178 Future minimum lease payments under the above non-cancellable operating leases are as follows: Years Ended December 31 2017 2016 Not later than 1 year Later than 1 year and not later than 5 years Later than 5 years December 31, 2017 December 31, 2016 $ 2,622,896 4,340,428 7,849,690 $ 777,233 2,683,437 5,300,624 $ 14,813,014 $ 8,761,294 34. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS Significant contingent liabilities and unrecognized commitments of the Company as of the end of the reporting period, excluding those disclosed in other notes, were as follows: a. Under a technical cooperation agreement with Industrial Technology Research Institute, the R.O.C. Government or its designee approved by the Company can use up to 35% of the Company’s capacity provided the Company’s outstanding commitments to its customers are not prejudiced. The term of this agreement is for five years beginning from January 1, 1987 and is automatically renewed for successive periods of five years unless otherwise terminated by either party with one year prior notice. As of December 31, 2017, the R.O.C. Government did not invoke such right. b. Under a Shareholders Agreement entered into with Philips and EDB Investments Pte Ltd. on March 30, 1999, the parties formed a joint venture company, SSMC, which is an integrated circuit foundry in Singapore. The Company’s equity interest in SSMC was 32%. Nevertheless, in September 2006, Philips spun-off its semiconductor subsidiary which was renamed as NXP B.V. Further, the Company and NXP B.V. purchased all the SSMC shares owned by EDB Investments Pte Ltd. pro rata according to the Shareholders Agreement on November 15, 2006. After the purchase, the Company and NXP B.V. currently own approximately 39% and 61% of the SSMC shares, respectively. The Company and NXP B.V. are required, in the aggregate, to purchase at least 70% of SSMC’s capacity, but the Company alone is not required to purchase more than 28% of the capacity. If any party defaults on the commitment and the capacity utilization of SSMC falls below a specific percentage of its capacity, the defaulting party is required to compensate SSMC for all related unavoidable costs. There was no default from the aforementioned commitment as of December 31, 2017. - 160 - - 160 - c. The Company joined the Customer Co-Investment Program of ASML and entered into the investment agreement in August 2012. The agreement includes an investment of EUR837,816 thousand by TSMC Global to acquire 5% of ASML’s equity with a lock-up period of 2.5 years. TSMC Global has acquired the aforementioned equity on October 31, 2012. The lock-up period expired on May 1, 2015 and as of October 8, 2015, all ASML shares had been disposed. Both parties also signed the research and development funding agreement whereby the Company shall provide EUR276,000 thousand to ASML’s research and development programs from 2013 to 2017. As of September 30, 2017, the amount has been fully paid. d. In May 2017, Mr. Uri Cohen filed a complaint in the U.S. District Court for the Eastern District of Texas alleging that the Company, TSMC North America and other companies infringe four U.S. patents. In response, the Company and TSMC North America filed a declaratory judgment complaint against Cohen in the U.S. District Court for the Northern District of California seeking a judgment declaring that there is no infringement of the same four patents. The Company also filed a motion to transfer Cohen’s lawsuit in the U.S. District Court for the Eastern District of Texas to the U.S. District Court for the Northern District of California. Cohen agreed to the transfer, and as of December 2017, the cases are consolidated and pending in the U.S. District Court for the Northern District of California. The outcome cannot be determined and the Company cannot make a reliable estimate of the contingent liability at this time. e. On September 28, 2017, the Company was contacted by the European Commission (“Commission”) for information and documents concerning alleged anti-competitive practices of the Company in relation to semiconductor sales. This proceeding is still in its preliminary stage, and it is premature to predict how the case will proceed, the outcome of the proceeding or its impact. The Company will continue to cooperate fully with the Commission. f. The Company entered into long-term purchase agreements of silicon wafer with multiple suppliers. The relative minimum purchase quantity and price are specified in the agreements. g. As of December 31, 2017, the Company provided financial guarantees of NT$34,107,850 thousand to its subsidiary, TSMC Global, in respect of the issuance of unsecured corporate bonds. h. As of December 31, 2017, the Company provided endorsement guarantees of NT$2,468,023 thousand to its subsidiary, TSMC North America, in respect of providing endorsement guarantees for office leasing contract. 35. SIGNIFICANT LOSS FROM DISASTER On February 6, 2016, an earthquake struck Taiwan. The resulting damage was mostly to inventories and equipment. The Company recognized earthquake losses of NT$2,492,138 thousand, net of insurance claim, for the year ended December 31, 2016. Such losses were primarily included in cost of revenue. The related insurance claim was finalized in the first quarter of 2017, and the accumulated earthquake losses were NT$2,386,824 thousand, net of insurance claim. The Company recognized a reduction of such losses of NT$105,314 thousand for the three months ended March 31, 2017. - 161 - - 161 - 36. EXCHANGE RATE INFORMATION OF FOREIGN-CURRENCY FINANCIAL ASSETS AND LIABILITIES The following information was summarized according to the foreign currencies other than the functional currency of the Company. The exchange rates disclosed were used to translate the foreign currencies into the functional currency. The significant financial assets and liabilities denominated in foreign currencies were as follows: Foreign Currencies (In Thousands) Exchange Rate (Note) Carrying Amount (In Thousands) December 31, 2017 Financial assets Monetary items USD EUR JPY Non-monetary items HKD Financial liabilities Monetary items USD EUR JPY December 31, 2016 Financial assets Monetary items USD EUR JPY Non-monetary items HKD Financial liabilities Monetary items USD EUR JPY $ 5,494,191 236,279 34,012,314 29.659 35.45 0.2629 $ 162,952,207 8,376,078 8,941,837 285,336 3.80 1,084,276 3,880,441 410,686 35,365,911 29.659 35.45 0.2629 115,090,012 14,558,807 9,297,698 4,583,146 19,545 36,963,829 32.199 34.30 0.2775 147,572,712 670,405 10,257,463 257,056 4.15 1,066,780 3,981,333 183,821 60,843,106 32.199 34.30 0.2775 128,194,952 6,305,052 16,883,962 Note: Exchange rate represents the number of N.T. dollars for which one foreign currency could be exchanged. Please refer to the parent company only statements of comprehensive income for the total of realized and unrealized foreign exchange gain and loss for the years ended December 31, 2017 and 2016, respectively. Since there were varieties of foreign currency transactions of the Company, the Company was unable to disclose foreign exchange gain (loss) towards each foreign currency with significant impact. - 162 - - 162 - 37. ADDITIONAL DISCLOSURES Following are the additional disclosures required by the Securities and Futures Bureau for the Company: a. Financings provided: Please see Table 1 attached; b. Endorsement/guarantee provided: Please see Table 2 attached; c. Marketable securities held (excluding investments in subsidiaries and associates): Please see Table 3 attached; d. Marketable securities acquired and disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital: Please see Table 4 attached; e. Acquisition of individual real estate properties at costs of at least NT$300 million or 20% of the paid-in capital: Please see Table 5 attached; f. Disposal of individual real estate properties at prices of at least NT$300 million or 20% of the paid-in capital: None; g. Total purchases from or sales to related parties of at least NT$100 million or 20% of the paid-in capital: Please see Table 6 attached; h. Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital: Please see Table 7 attached; i. Information about the derivative financial instruments transaction: Please see Notes 7 and 9; j. Names, locations, and related information of investees over which the Company exercises significant influence (excluding information on investment in mainland China): Please see Table 8 attached; k. Information on investment in mainland China 1) The name of the investee in mainland China, the main businesses and products, its issued capital, method of investment, information on inflow or outflow of capital, percentage of ownership, income (losses) of the investee, share of profits/losses of investee, ending balance, amount received as dividends from the investee, and the limitation on investee: Please see Table 9 attached. 2) Significant direct or indirect transactions with the investee, its prices and terms of payment, unrealized gain or loss, and other related information which is helpful to understand the impact of investment in mainland China on financial reports: Please see Note 32. 38. OPERATING SEGMENTS INFORMATION The Company has provided the operating segments disclosure in the consolidated financial statements. - 163 - - 163 - ) 2 d n a 1 s e t o N ( ) 2 d n a 1 s e t o N ( 1 E L B A T g n i c n a n i F s ’ y n a p m o C g n i c n a n i F l a t o T s t i m L i t n u o m A g n i c n a n i F l a r e t a l l o C h c a E r o f s t i m L i g n i w o r r o B y n a p m o C e u l a V m e t I t b e D d a B ) 4 e t o N ( s t n u o m A ) 4 e t o N ( r o f e c n a w o l l A g n i c n a n i F r o f n o s a e R n o i t c a s n a r T g n i c n a n F r o f i e r u t a N e t a R t s e r e t n I n g i e r o F ( n i s e i c n e r r u C ) s d n a s u o h T n i s e i c n e r r u C ) s d n a s u o h T ) 3 e t o N ( n w a r D y l l a u t c A n g i e r o F ( t n u o m A e c n a l a B g n i d n E m u m i x a M e h t r o f e c n a l a B n i s e i c n e r r u C ) s d n a s u o h T ) 3 e t o N ( y t r a P t n u o c c A n g i e r o F ( d o i r e P d e t a l e R t n e m e t a t S l a i c n a n i F y t r a p - r e t n u o C g n i c n a n i F y n a p m o C . o N ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F s e e t s e v n I d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T D E D I V O R P S G N I C N A N I F 7 7 8 , 1 1 2 , 9 0 3 7 7 8 , 1 1 2 , 9 0 3 5 1 8 , 1 6 1 , 1 5 $ 5 1 8 , 1 6 1 , 1 5 $ - - $ - - - - $ l a t i p a c g n i t a r e p O l a t i p a c g n i t a r e p O - - $ / m r e t - t r o h s r o f d e e n e h T % 5 . 1 - % 3 . 1 0 0 8 , 9 3 0 , 0 2 $ 0 0 7 , 0 5 9 , 0 2 $ 0 0 7 , 0 5 9 , 0 2 $ g n i c n a n i f m r e t - g n o l ) 0 0 0 , 0 0 4 , 4 B M R ( ) 0 0 0 , 0 0 6 , 4 B M R ( ) 0 0 0 , 0 0 6 , 4 B M R ( g n i c n a n i f m r e t - t r o h s r o f d e e n e h T % 5 4 . 1 - % 8 0 . 1 - 0 0 5 , 8 8 4 , 4 4 0 0 5 , 8 8 4 , 4 4 ) 0 0 0 , 0 0 5 , 1 $ S U ( ) 0 0 0 , 0 0 5 , 1 $ S U ( s e Y s e Y s e i t r a p d e t a l e r m o r f s e l b a v i e c e r r e h t O g n i j n a N C M S T a n i h C C M S T s e i t r a p d e t a l e r m o r f s e l b a v i e c e r r e h t O C M S T l a b o l G C M S T l l a h s C M S T f o y r a i d i s b u s h c u s y n a o t e l b a d n e l t n u o m a l a t o t e h t , r e v e w o H . C M S T y b , y l t c e r i d n i r o y l t c e r i d , d e n w o % 0 0 1 e r a s e r a h s g n i t o v e s o h w s e i r a i d i s b u s e h t o t y l p p a t o n s e o d n o i t c i r t s e r e v o b a e h T . h t r o w t e n s ’ r e w o r r o b e h t f o ) % 0 3 ( t n e c r e p y t r i h t n a h t e r o m o n e b l l a h s r e w o r r o b e n o e b t o n l l i w g n i d n e l e h t , n a w i a T n i d e t a c o l t o n e r a h c i h w , C M S T y b , y l t c e r i d n i r o y l t c e r i d , d e n w o % 0 0 1 e r a s e r a h s g n i t o v e s o h w s e i r a i d i s b u s e h t o t r o , C M S T o t a n i h C C M S T y b s d e e n g n i d n u f r o f g n i d n e l a s i e r e h t n e h W . a n i h C C M S T f o h t r o w t e n e h t f o ) % 0 4 ( t n e c r e p y t r o f d e e c x e t o n y n a o t e l b a d n e l t n u o m a l a t o t e h t , n o i t i d d a n I . a n i h C C M S T f o h t r o w t e n e h t f o ) % 0 1 ( t n e c r e p n e t d e e c x e t o n l l a h s d o i r e p m r e t - t r o h s a r o f g n i d n u f r o f y n a p m o c a o t g n i d n e l r o f t n u o m a l a t o t e h T . a n i h C C M S T f o h t r o w t e n e h t d e e c x e t o n l l a h s e s o p r u p g n i d n e l r o f e l b a l i a v a t n u o m a l a t o t e h T : 1 . a n i h C C M S T f o h t r o w t e n e h t d e e c x e t o n l l a h s l l i t s s r e w o r r o b h c u s f o h c a e o t e l b a d n e l t n u o m a l a t o t e h t d n a s r e w o r r o b h c u s o t g n i d n e l r o f e l b a l i a v a t n u o m a e t a g e r g g a e h t , g n i o g e r o f e h t g n i d n a t s h t i w t o N . e l c i t r A s i h t f o h p a r g a r a p e v o b a e h t n i h t r o f t e s n o i t c i r t s e r e h t o t t c e j b u s e h t d e e c x e t o n l l a h s l l i t s t n u o m a g n i w o r r o b l a t o t r i e h t , n o i t c i r t s e r s i h t o t t c e j b u s e b t o n l l i w C M S T y b , y l t c e r i d n i r o y l t c e r i d , d e n w o % 0 0 1 e r a s e r a h s g n i t o v e s o h w s e i r a i d i s b u s n g i e r o f r o , C M S T e l i h W . h t r o w t e n s ’ r e w o r r o b e h t f o ) % 0 3 ( t n e c r e p y t r i h t n a h t e r o m o n e b l l a h s r e w o r r o b e n o y n a o t e l b a d n e l t n u o m a l a t o t e h t , n o i t i d d a n I . l a b o l G C M S T f o h t r o w t e n e h t f o ) % 0 1 ( t n e c r e p n e t d e e c x e t o n l l a h s d o i r e p m r e t - t r o h s a r o f g n i d n u f r o f y n a p m o c a o t g n i d n e l r o f t n u o m a l a t o t e h T . l a b o l G C M S T f o h t r o w t e n e h t d e e c x e t o n l l a h s e s o p r u p g n i d n e l r o f e l b a l i a v a t n u o m a l a t o t e h T : 2 . l a b o l G C M S T f o h t r o w t e n e h t f o ) % 0 4 ( t n e c r e p y t r o f d e e c x e t o n l l a h s C M S T n a h t r e h t o s e i n a p m o c n a w i a T o t g n i d n e l r o f t n u o m a e t a g e r g g a e h t , g n i o g e r o f e h t g n i d n a t s h t i w t o N . l a b o l G C M S T f o h t r o w t e n 1 2 e t o N e t o N . s e r a h s g n i t o v e h t f o % 0 0 1 , y l t c e r i d n i r o y l t c e r i d , s d l o h y n a p m o C e h t h c i h w n i s e i r a i d i s b u s e r o h s f f o n e e w t e b g n i d n u f r o f s n a o l y n a p m o c - r e t n i o t y l p p a t o n l l a h s r a e y e n o g n i d e e c x e t o n g n i d n u f r o f n a o l h c a e f o m r e t e h t f o n o i t c i r t s e r e h T . s r o t c e r i D f o d r a o B e h t y b d e v o r p p a s t n u o m a e h t t n e s e r p e r e c n a l a b g n i d n e d n a d o i r e p e h t r o f e c n a l a b m u m i x a m e h T : 3 : 4 e t o N e t o N - - 4 4 6 6 1 1 - - 2 E L B A T e e t n a r a u G o t d e d i v o r P s e i r a i d i s b u S d n a l n i a M n i a n i h C e e t n a r a u G y b d e d i v o r P y r a i d i s b u S A e e t n a r a u G y b d e d i v o r P t n e r a P y n a p m o C m u m i x a M / t n e m e s r o d n E e e t n a r a u G t n u o m A e l b a w o l l A ) 2 e t o N ( s t n e m e t a t S f o o i t a R d e t a l u m u c c A / t n e m e s r o d n E f o t n u o m A / t n e m e s r o d n E t e N o t e e t n a r a u G e e t n a r a u G l a i c n a n i F t s e t a L s e i t r e p o r P r e p y t i u q E y b d e z i l a r e t a l l o C y l l a u t c A t n u o m A e c n a l a B g n i d n E n w a r D n i $ S U ( ) s d n a s u o h T n i $ S U ( ) s d n a s u o h T ) 3 e t o N ( s e e t s e v n I d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( D E D I V O R P S E E T N A R A U G / S T N E M E S R O D N E 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F m u m i x a M e c n a l a B d o i r e P e h t r o f / t n e m e s r o d n E e e t n a r a u G t n u o m A n i $ S U ( h c a E o t d e d i v o r P ) s d n a s u o h T ) 3 e t o N ( d e e t n a r a u G y t r a P ) 2 d n a 1 s e t o N ( n o s t i m L i y t r a P d e e t n a r a u G f o e r u t a N p i h s n o i t a l e R e m a N r e d i v o r P e e t n a r a u G / t n e m e s r o d n E . o N o N o N o N o N s e Y s e Y 3 8 3 , 4 1 5 , 0 8 3 3 8 3 , 4 1 5 , 0 8 3 $ % 4 2 . 2 % 6 1 . 0 - - ) 0 0 0 , 0 5 1 , 1 $ S U ( ) 0 0 0 , 0 5 1 , 1 $ S U ( ) 0 0 0 , 0 5 1 , 1 $ S U ( ) 3 1 2 , 3 8 $ S U ( ) 3 1 2 , 3 8 $ S U ( ) 3 1 2 , 3 8 $ S U ( a c i r e m A 3 2 0 , 8 6 4 , 2 3 2 0 , 8 6 4 , 2 3 2 0 , 8 6 4 , 2 3 8 3 , 4 1 5 , 0 8 3 y r a i d i s b u S h t r o N C M S T $ 0 5 8 , 7 0 1 , 4 3 $ 0 5 8 , 7 0 1 , 4 3 $ 0 5 8 , 7 0 1 , 4 3 $ 3 8 3 , 4 1 5 , 0 8 3 $ y r a i d i s b u S l a b o l G C M S T C M S T 0 , d e n w o % 0 0 1 e r a s e r a h s g n i t o v e s o h w s e i r a i d i s b u s , r e v e w o H . y t i t n e h c u s f o h t r o w t e n e h t r o , h t r o w t e n s ’ C M S T f o ) % 0 1 ( t n e c r e p n e t d e e c x e t o n l l a h s y t i t n e l a u d i v i d n i y n a o t C M S T y b d e d i v o r p e e t n a r a u g e h t f o t n u o m a l a t o t e h T . s r o t c e r i D f o d r a o B e h t f o l a v o r p p a e h t r e t f a s n o i t c i r t s e r e v o b a e h t o t t c e j b u s t o n e r a C M S T y b , y l t c e r i d n i r o y l t c e r i d : 1 e t o N . s r o t c e r i D f o d r a o B e h t y b d e v o r p p a s t n u o m a e h t t n e s e r p e r e c n a l a b g n i d n e d n a d o i r e p e h t r o f e c n a l a b m u m i x a m e h T : 3 . h t r o w t e n s ’ C M S T f o ) % 5 2 ( t n e c r e p e v i f - y t n e w t d e e c x e t o n l l a h s e e t n a r a u g f o t n u o m a l a t o t e h T : 2 e t o N e t o N - - 5 5 6 6 1 1 - - 3 E L B A T e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( D L E H S E I T I R U C E S E L B A T E K R A M 7 1 0 2 , 1 3 R E B M E C E D s e e t s e v n I d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T , 9 7 2 9 0 3 , 1 , 6 7 2 4 8 0 , 1 4 8 5 3 9 1 , 0 0 0 5 0 1 , 1 4 0 , 4 1 4 0 9 9 , 5 7 9 , 6 0 1 4 , 6 $ - 0 0 0 5 6 , $ S U 7 0 6 , 8 0 7 2 , 4 5 1 1 3 4 , 3 0 7 2 4 , 1 0 1 0 4 , 5 6 4 8 3 , 1 1 9 9 2 , 7 6 8 6 2 , 3 3 5 8 1 , 8 9 2 8 1 , 4 2 0 7 1 , 3 6 4 6 1 , 2 1 4 4 1 , 3 2 6 3 1 , 6 0 4 3 1 , 4 1 2 2 1 , 5 1 0 2 1 , 7 9 0 1 1 , 3 7 0 1 1 , 1 9 7 0 1 , 5 6 4 0 1 , 4 6 4 0 1 , 3 8 3 0 1 , 4 6 2 0 1 , 8 1 0 0 1 , 8 6 8 , 9 2 6 8 , 9 0 2 6 , 9 0 1 4 , 9 6 9 3 , 9 1 0 3 , 9 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 2 1 - 0 1 7 6 2 1 2 1 5 2 2 1 9 6 A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / , 9 7 2 9 0 3 , 1 , 6 7 2 4 8 0 , 1 4 8 5 3 9 1 , 0 0 0 5 0 1 , 1 4 0 , 4 1 4 0 9 9 , 5 7 9 , 6 0 1 4 , 6 $ 0 2 3 8 5 , 5 0 1 1 2 , 0 3 2 1 2 , 0 0 5 0 1 , 4 2 1 1 1 , 2 5 1 , 1 - - " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A " t s o c t a d e i r r a c s t e s s a l a i c n a n i F " t s o c t a d e i r r a c s t e s s a l a i c n a n i F - 0 0 0 5 6 , $ S U 3 3 3 , 6 0 4 4 0 1 , " t s o c t a d e i r r a c s t e s s a l a i c n a n i F 7 0 6 , 8 0 7 2 , 4 5 1 1 3 4 , 3 0 7 2 4 , 1 0 1 0 4 , 5 6 4 8 3 , 1 1 9 9 2 , 7 6 8 6 2 , 3 3 5 8 1 , 8 9 2 8 1 , 4 2 0 7 1 , 3 6 4 6 1 , 2 1 4 4 1 , 3 2 6 3 1 , 6 0 4 3 1 , 4 1 2 2 1 , 5 1 0 2 1 , 7 9 0 1 1 , 3 7 0 1 1 , 1 9 7 0 1 , 5 6 4 0 1 , 4 6 4 0 1 , 3 8 3 0 1 , 4 6 2 0 1 , 8 1 0 0 1 , 8 6 8 , 9 2 6 8 , 9 0 2 6 , 9 0 1 4 , 9 6 9 3 , 9 1 0 3 , 9 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " " " " " " " " " " " " t s o c t a d e i r r a c s t e s s a l a i c n a n i F s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A ) d e u n i t n o C ( - - 6 6 6 6 1 1 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - n o i t a r o p r o C l a n o i t a n r e t n I g n i r u t c a f u n a M r o t c u d n o c i m e S . d t L , . o C n a w i a T i a t o d n a H u s t E - n i h S . d t L , . o C s e s a G l a i r t s u d n I d e t i n U . c n I g n i d l o H t n e m t s e v n I l a b o l G k c o t s n o m m o C h c e t o M C M S T V I d n u F y g o l o n h c e T . . K W . . P L , I I s t n e m t s e v n I e r u t n e V n e d l a W a n i h C d n u F s e r u t n e V n o z i r o H l a t i p a C a i s A n o s m i r C d n u F s n o i t a v o n n I a l e T k c o t s n o m m o C . c n I e b u c M d n u F e s i r p r e t n E l a t i p a C e r u t n e V n e d l a W i a h g n a h S e h T / c n I p u o r G s h c a S n a m d l o G c n I s n o i t a c i n u m m o C n o z i r e V C L L o C t i d e r C r o t o M d r o F c n I p u o r g i t i C c n I T & T A p r o C a c i r e m A f o k n a B o C & e s a h C n a g r o M P J d n o b e t a r o p r o C y e l n a t S n a g r o M p r o C l a t i p a C T A B A N k n a B C N P c n I e l p p A c n I e c n a n i F v e B n I h c s u B - r e s u e h n A / Y N k r o Y w e N G A e s s i u S t i d e r C c n I s d o o F n o s y T e h T / o C n r e h t u o S c n I e i V b b A c n I p u o r G l a i c n a n i F J F U i h s i b u s t i M k n a B t n e m p o l e v e D n a i s A c n I p u o r G l a i c n a n i F i u s t i M o m o t i m u S c n I p u o r G l a n o i t a n r e t n I n a c i r e m A B A n e k n a b s l e d n a H a k s n e v S p r o C p u o r G l a t i p a C n o i t a i v A p r o C t f o s o r c i M p r o C g n i k n a B c a p t s e W c n I h t l a e H l a n i d r a C C L P s t e k r a M l a t i p a C P B p r o C h t l a e H S V C o C & o g r a F s l l e W A V n a e l c / M A N e n O l a t i p a C s r e n t r a P C M S T l a b o l G C M S T e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 9 9 0 , 9 9 5 7 , 8 6 2 6 , 8 4 0 6 , 8 6 0 5 , 8 7 3 3 , 8 1 4 0 , 8 2 9 9 , 7 3 7 8 , 7 4 9 7 , 7 5 0 5 , 7 3 5 3 , 7 7 2 3 , 7 2 5 2 , 7 0 0 1 , 7 3 7 0 , 7 2 7 0 , 7 0 1 0 , 7 4 9 9 , 6 1 7 9 , 6 1 7 9 , 6 0 0 9 , 6 2 8 8 , 6 6 6 8 , 6 6 2 7 , 6 3 4 5 , 6 1 3 5 , 6 4 8 4 , 6 3 8 4 , 6 7 4 3 , 6 6 3 3 , 6 6 0 3 , 6 1 0 3 , 6 9 1 2 , 6 1 8 1 , 6 0 8 1 , 6 8 3 9 , 5 5 2 9 , 5 1 0 9 , 5 8 5 8 , 5 7 4 8 , 5 9 6 7 , 5 8 6 7 , 5 3 2 7 , 5 5 7 6 , 5 3 4 6 , 5 5 0 6 , 5 1 7 5 , 5 6 3 5 , 5 7 9 2 , 5 9 5 2 , 5 3 4 2 , 5 5 4 1 , 5 9 8 0 , 5 5 6 0 , 5 3 4 0 , 5 2 3 0 , 5 5 0 0 , 5 0 0 0 , 5 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 9 9 0 , 9 9 5 7 , 8 6 2 6 , 8 4 0 6 , 8 6 0 5 , 8 7 3 3 , 8 1 4 0 , 8 2 9 9 , 7 3 7 8 , 7 4 9 7 , 7 5 0 5 , 7 3 5 3 , 7 7 2 3 , 7 2 5 2 , 7 0 0 1 , 7 3 7 0 , 7 2 7 0 , 7 0 1 0 , 7 4 9 9 , 6 1 7 9 , 6 1 7 9 , 6 0 0 9 , 6 2 8 8 , 6 6 6 8 , 6 6 2 7 , 6 3 4 5 , 6 1 3 5 , 6 4 8 4 , 6 3 8 4 , 6 7 4 3 , 6 6 3 3 , 6 6 0 3 , 6 1 0 3 , 6 9 1 2 , 6 1 8 1 , 6 0 8 1 , 6 8 3 9 , 5 5 2 9 , 5 1 0 9 , 5 8 5 8 , 5 7 4 8 , 5 9 6 7 , 5 8 6 7 , 5 3 2 7 , 5 5 7 6 , 5 3 4 6 , 5 5 0 6 , 5 1 7 5 , 5 6 3 5 , 5 7 9 2 , 5 9 5 2 , 5 3 4 2 , 5 5 4 1 , 5 9 8 0 , 5 5 6 0 , 5 3 4 0 , 5 2 3 0 , 5 5 0 0 , 5 0 0 0 , 5 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ) d e u n i t n o C ( - - 7 7 6 6 1 1 - - I I g n i d n u F l a b o l G e f i L d r a d n a t S e c n a i l e R B A n e k n a B a d l i k s n E a k s i v a n i d n a k S c n I p u o r G l a i c n a n i F o h u z i M p r o c n a B d r i h T h t f i F e h T / p r o C n o l l e M k r o Y w e N f o k n a B C L P s g n i d l o H p u o r G K U r e d n a t n a S c n I r e w o t l l e W p r o C n a m m u r G p o r h t r o N p r o C e n e g l e C C A D e c n a n i F l a t i p a C n o i t a i v A C B M S o C t s u r T s r e d a r T & s r e r u t c a f u n a M e h T / o C l a c i m e h C w o D A S r e d n a t n a S o c n a B c n I s g n i d l o H l a t i p a C y g r e n E a r E t x e N p r o C s g n i d l o H r e g r e b m u l h c S d t L s g n i d l o H e c n a r u s n I n e p s A p r o C t i d e r C r o t o M a t o y o T C L P K U r e d n a t n a S A S e n o n a D / n o d n o L G A S B U p r o C y e K p r o C e c n a n i F L T P / p L o C g n i s a e L k c u r T e k s n e P g n i d n u F l a b o l G e f i L l a n o i t a N n o s k c a J o C t s u r T & g n i k n a B h c n a r B H O d n a l e v e l C A N k n a B y e K / p r o C e c n a n i F l a n o i t a n r e t n I T C d r o f m a t S / G A S B U c n I s n i l l o C l l e w k c o R p r o C a n g i C d t L s g n i d l o H e R r e i l e p t n o M D M / c n I o C & k c i m r o C c M c n I n e g m A p r o C s g n i d l o H C T I B A k n a B a e d r o N I R e c n e d i v o r P / A N k n a B s n e z i t i C t n e m p o l e v e D & n o i t c u r t s n o c e R r o f k n a B l a n o i t a n r e t n I p r o C l a t i p a C s a t n e V / P L y t l a e R s a t n e V o C e s i r p r e t n E d r a k c a P t t e l w e H C L L a c i r e m A h t r o N e c n a n i F r e l m i a D p r o C y g r e n E e k u D C L L e c n a n i F A S U C A R E c n I y g r e n E n o i n i m o D C L P s g n i d l o H C B S H V B e c n a n i F l a n o i t a n r e t n I m o k e l e T e h c s t u e D V N j i p p a h c s t a a m s g n i r e i c n a n i F s n e m e i S A S l e u t u M t i d e r C u d e v i t a r e d e F e u q n a B C L P s e c i v r e S y r u s a e r T r e s i k c n e B t t i k c e R V N k n a B O R M A N B A G A d n a l r e z t i w S g n i d n u F p u o r G S B U n o d n o L / d t L l ' t n I d n a l a e Z w e N Z N A e h T / k n a B n o i n i m o D - o t n o r o T e h T / k n a B l a n o i t a N n o t g n i t n u H p r o C e l c a r O D M / c n I l a n o i t a n r e t n I t t o i r r a M c n I a c i r e m A x o F y r u t n e C t s 1 2 a c i r e m A l a t i p a C i a d n u y H p r o C e s a e L r i A c n I M M O C L A U Q C L P s y a l c r a B l a b o l G C M S T ) d e u n i t n o C ( - - 8 8 6 6 1 1 - - e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 8 4 9 , 4 5 3 9 , 4 7 1 9 , 4 8 0 9 , 4 9 1 8 , 4 2 8 7 , 4 0 4 7 , 4 5 3 7 , 4 4 2 7 , 4 9 8 6 , 4 9 5 6 , 4 2 4 6 , 4 7 8 5 , 4 3 8 5 , 4 2 7 4 , 4 6 4 4 , 4 1 9 3 , 4 7 6 3 , 4 8 0 2 , 4 9 1 1 , 4 8 9 0 , 4 0 9 9 , 3 2 8 9 , 3 1 6 9 , 3 9 3 9 , 3 1 1 9 , 3 8 8 8 , 3 4 6 8 , 3 5 2 8 , 3 7 8 7 , 3 8 3 7 , 3 6 3 7 , 3 3 6 6 , 3 9 0 6 , 3 7 8 5 , 3 4 7 5 , 3 8 6 5 , 3 1 2 5 , 3 5 1 5 , 3 1 8 4 , 3 0 6 3 , 3 5 5 3 , 3 5 2 2 , 3 2 2 1 , 3 5 1 1 , 3 0 2 0 , 3 2 1 0 , 3 5 9 9 , 2 0 9 9 , 2 4 2 9 , 2 2 8 8 , 2 5 6 8 , 2 7 7 7 , 2 9 1 7 , 2 3 9 6 , 2 9 8 6 , 2 7 5 6 , 2 9 8 5 , 2 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 8 4 9 , 4 5 3 9 , 4 7 1 9 , 4 8 0 9 , 4 9 1 8 , 4 2 8 7 , 4 0 4 7 , 4 5 3 7 , 4 4 2 7 , 4 9 8 6 , 4 9 5 6 , 4 2 4 6 , 4 7 8 5 , 4 3 8 5 , 4 2 7 4 , 4 6 4 4 , 4 1 9 3 , 4 7 6 3 , 4 8 0 2 , 4 9 1 1 , 4 8 9 0 , 4 0 9 9 , 3 2 8 9 , 3 1 6 9 , 3 9 3 9 , 3 1 1 9 , 3 8 8 8 , 3 4 6 8 , 3 5 2 8 , 3 7 8 7 , 3 8 3 7 , 3 6 3 7 , 3 3 6 6 , 3 9 0 6 , 3 7 8 5 , 3 4 7 5 , 3 8 6 5 , 3 1 2 5 , 3 5 1 5 , 3 1 8 4 , 3 0 6 3 , 3 5 5 3 , 3 5 2 2 , 3 2 2 1 , 3 5 1 1 , 3 0 2 0 , 3 2 1 0 , 3 5 9 9 , 2 0 9 9 , 2 4 2 9 , 2 2 8 8 , 2 5 6 8 , 2 7 7 7 , 2 9 1 7 , 2 3 9 6 , 2 9 8 6 , 2 7 5 6 , 2 9 8 5 , 2 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - t s u r T s e i t r e p o r P w e i v r i a F c a l l i d a C ' s r e h c a e T o i r a t n O V B s d n a l r e h t e N s g n i d l o H l a n o i t a n r e t n I z e l e d n o M C L L g n i t a r e p O s t c u d o r P e s i r p r e t n E C L L o C n o i t a r e n e G n o l e x E g n i d n u F l a b o l G e f i L k r o Y w e N H O / i t a n n i c n i C A N k n a B S U a d a n a C f o k n a B l a y o R C L P k n a B s d y o l L p r o C l e t n I c n I s k n a B t s u r T n u S p r o C h c r a e s e R m a L c n I m e t s y S r e d y R c n I s a x e T P E A p r o C t i d e r C s s e r p x E n a c i r e m A t s u r T g n i d n u F s r e n r o C e v i F A S e c n a n i F e d i u q i L r i A V B e c n a n i F l a n o i t a n r e t n I l l e h S c n I s n o i t a c i n u m m o C x o C d t L p u o r G e i r a u q c a M k n a B t n e m t s e v n I n a e p o r u E A N k n a b i t i C c n I s e c i v e D g o l a n A p r o c n a B S U e c r e m m o C f o k n a B l a i r e p m I n a i d a n a C c n I d r a T - e h c u o C n o i t a t n e m i l A / n o d n o L A S e l o c i r g A t i d e r C g n i d n u F l a b o l G e f i L e v i t c e t o r P o C c i r t c e l E & s a G c i f i c a P C L L e c n a n i F n e e v u N P G s g n i d l o H s a c i r e m A L A B O L G S E S V N s e i r t s u d n I l l e s a B l l e d n o y L c n I e g n a h c x E l a t n e n i t n o c r e t n I o C g n i d l o H s t p i r c S s s e r p x E A N k n a B o g r a F s l l e W l a n o i t a n r e t n I n o s i d E p r o C T & B B a i t o c S a v o N f o k n a B d t L y a w t e M - p r o c n u S c n I y g r e n E y k s u H t n i r p S / C L L I I o C m u r t c e p S t n i r p S / C L L o C m u r t c e p S t n i r p S t s u r T h g u o r h T s s a P A s s a l C 1 - 7 0 0 2 s e n i L r i A a t l e D c n I e d i w d l r o W v e B n I h c s u B - r e s u e h n A V N l a n o i t a n r e t n I e c n a n i F l e n E d t L k n a B e i r a u q c a M c n I r e n r a W e m T i c n I m e h t n A c n I a n t e A H O i t a n n i c n i C / k n a B d r i h T h t f i F C L L B e c n a n i F e R r e n t r a P p r o C e c n a n i F e c r u o S i N C L P p u o r G g n i k n a B s d y o l L C L L l a t i p a C S U W M B c n I e n o Z o t u A C L L I I I o C m u r t c e p S P L t s u r T y t l a e R l a t i g i D o C y g o l o n h c e T C X D A S s a b i r a P P N B p r o C t e e r t S e t a t S e h T / o C r e g o r K l a b o l G C M S T ) d e u n i t n o C ( - - 9 9 6 6 1 1 - - e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 6 5 5 , 2 9 1 5 , 2 1 0 5 , 2 0 9 4 , 2 9 8 4 , 2 5 8 4 , 2 9 3 4 , 2 6 2 4 , 2 7 3 3 , 2 1 3 3 , 2 7 1 3 , 2 1 0 3 , 2 0 0 3 , 2 9 8 2 , 2 0 8 2 , 2 1 4 2 , 2 7 2 2 , 2 8 1 2 , 2 6 0 2 , 2 0 5 1 , 2 6 3 1 , 2 0 3 1 , 2 3 1 1 , 2 5 0 0 , 2 2 0 0 , 2 1 0 0 , 2 2 6 9 , 1 0 6 9 , 1 4 5 9 , 1 7 4 9 , 1 4 2 9 , 1 0 2 9 , 1 3 1 9 , 1 8 0 9 , 1 6 3 8 , 1 2 3 8 , 1 1 3 8 , 1 9 0 8 , 1 4 9 7 , 1 1 9 7 , 1 5 7 7 , 1 3 7 7 , 1 2 6 7 , 1 1 6 7 , 1 8 5 7 , 1 1 5 7 , 1 1 4 7 , 1 8 0 7 , 1 1 9 6 , 1 9 2 6 , 1 6 2 6 , 1 8 0 6 , 1 2 0 6 , 1 4 9 5 , 1 8 8 5 , 1 6 3 5 , 1 2 3 5 , 1 7 2 5 , 1 0 1 5 , 1 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 6 5 5 , 2 9 1 5 , 2 1 0 5 , 2 0 9 4 , 2 9 8 4 , 2 5 8 4 , 2 9 3 4 , 2 6 2 4 , 2 7 3 3 , 2 1 3 3 , 2 7 1 3 , 2 1 0 3 , 2 0 0 3 , 2 9 8 2 , 2 0 8 2 , 2 1 4 2 , 2 7 2 2 , 2 8 1 2 , 2 6 0 2 , 2 0 5 1 , 2 6 3 1 , 2 0 3 1 , 2 3 1 1 , 2 5 0 0 , 2 2 0 0 , 2 1 0 0 , 2 2 6 9 , 1 0 6 9 , 1 4 5 9 , 1 7 4 9 , 1 4 2 9 , 1 0 2 9 , 1 3 1 9 , 1 8 0 9 , 1 6 3 8 , 1 2 3 8 , 1 1 3 8 , 1 9 0 8 , 1 4 9 7 , 1 1 9 7 , 1 5 7 7 , 1 3 7 7 , 1 2 6 7 , 1 1 6 7 , 1 8 5 7 , 1 1 5 7 , 1 1 4 7 , 1 8 0 7 , 1 1 9 6 , 1 9 2 6 , 1 6 2 6 , 1 8 0 6 , 1 2 0 6 , 1 4 9 5 , 1 8 8 5 , 1 6 3 5 , 1 2 3 5 , 1 7 2 5 , 1 0 1 5 , 1 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - d t L y e s n r e u G g n i d n u F p u o r G e s s i u S t i d e r C I g n i d n u F l a b o l G e f i L n a t i l o p o r t e M p r o C l a i c n a n i F e n O l a t i p a C k r o Y w e N / d t L k n a B a i l a r t s u A l a n o i t a N e h T / d t L J F U i h s i b u s t i M - o y k o T f o k n a B P L p u o r G y t r e p o r P n o m i S k n a B t n e m p o l e v e D n a c i r e m A r e t n I c n I l a i c n a n i F a y o V p r o C y t l a e R o c m K i V N p e o r G G N I o C & s r u o m e N e d t n o P u d I E C L L a i d e M l a s r e v i n U C B N c n I p u o r G h t l a e H d e t i n U o C l a c i m e h C n a m t s a E o C r J y e l g i r W m W Y N / c n I m e l y X I g n i d n u F l a b o l G a o c i r P 2 o N p r o C s a t n i C p r o C e c n a r u s s A o r P p r o C y e l k r e B R W l a e r t n o M f o k n a B p r o C o c s y S c n I P C H t s u r T h g u o r h T s s a P A s s a l C 2 - 3 1 0 2 s e n i l r i A n a c i r e m A C L P s n o i t a c i n u m m o c e l e T h s i t i r B c l p l a n o i t a n r e t n I s l o r t n o C n o s n h o J S / A k n a B e k s n a D P L s r e n t r a P m a e r t s d i M n a l l e g a M / e h T C L L s o C s n r a e t S r a e B A G a t n a l t A / k n a B t s u r T n u S A S e l a r e n e G e t e i c o S o C T K R k c o R t s e W A S e g n a r O c n I l a n o i t a n r e t n I s i r r o M p i l i h P P L y t l a e R e k u D p r o C r e k y r t S A S E C P B Y N k r o Y w e N / d t L p u o r G g n i k n a B d n a l a e Z w e N & a i l a r t s u A Y N k r o Y w e N / a i l a r t s u A f o k n a B h t l a e w n o m m o C d t L t n e m t s e v n I s a e s r e v O d i r G e t a t S c n I A S U s e l b m a r B c n I a s i V C L L s g n i d l o H s a G y g r e n E n o i n i m o D p r o C s e i g o l o n h c e T d e t i n U P L s r e t n e C y c n e g e R d t L k n a B t s u r T i u s t i M o m o t i m u S p r o C g n i k n a B i u s t i M o m o t i m u S p r o C l a i c n a n i F s n o i g e R C L L e c n a n i F a r r e t l A c n I s e c n e i c S d a e l i G o C r e s u e a h r e y e W c n I m o c . n o z a m A p r o C s e c i v r e S l a i c n a n i F r a l l i p r e t a C C L P e c n a n i F l a n o i t a n r e t n I T A B I I g n i d n u F l a b o l G e f i L l a p i c n i r P c n I e v i t o m o t u A y l l i e R O ' C L L r e w o P G E S P p r o C n o r v e h C p r o C e m o c n I y t l a e R l a b o l G C M S T e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 0 0 5 , 1 8 9 4 , 1 7 9 4 , 1 5 9 4 , 1 0 7 4 , 1 9 6 4 , 1 9 5 4 , 1 0 5 4 , 1 4 4 4 , 1 9 2 4 , 1 8 0 4 , 1 1 0 4 , 1 7 8 3 , 1 6 6 3 , 1 4 8 2 , 1 7 7 2 , 1 3 7 2 , 1 6 6 2 , 1 1 6 2 , 1 6 5 2 , 1 3 1 2 , 1 6 0 2 , 1 9 7 1 , 1 6 3 1 , 1 4 3 1 , 1 8 1 1 , 1 5 9 0 , 1 5 8 0 , 1 5 7 0 , 1 7 6 0 , 1 4 6 0 , 1 4 6 0 , 1 0 5 0 , 1 9 4 0 , 1 2 4 0 , 1 7 3 0 , 1 2 3 0 , 1 9 2 0 , 1 6 1 0 , 1 3 1 0 , 1 9 0 0 , 1 7 0 0 , 1 6 0 0 , 1 4 0 0 , 1 2 0 0 , 1 0 0 0 , 1 9 9 9 8 9 9 7 9 9 2 9 9 2 9 9 8 8 9 6 7 9 5 6 9 2 3 9 9 2 9 7 1 9 5 0 9 1 0 9 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 0 0 5 , 1 8 9 4 , 1 7 9 4 , 1 5 9 4 , 1 0 7 4 , 1 9 6 4 , 1 9 5 4 , 1 0 5 4 , 1 4 4 4 , 1 9 2 4 , 1 8 0 4 , 1 1 0 4 , 1 7 8 3 , 1 6 6 3 , 1 4 8 2 , 1 7 7 2 , 1 3 7 2 , 1 6 6 2 , 1 1 6 2 , 1 6 5 2 , 1 3 1 2 , 1 6 0 2 , 1 9 7 1 , 1 6 3 1 , 1 4 3 1 , 1 8 1 1 , 1 5 9 0 , 1 5 8 0 , 1 5 7 0 , 1 7 6 0 , 1 4 6 0 , 1 4 6 0 , 1 0 5 0 , 1 9 4 0 , 1 2 4 0 , 1 7 3 0 , 1 2 3 0 , 1 9 2 0 , 1 6 1 0 , 1 3 1 0 , 1 9 0 0 , 1 7 0 0 , 1 6 0 0 , 1 4 0 0 , 1 2 0 0 , 1 0 0 0 , 1 9 9 9 8 9 9 7 9 9 2 9 9 2 9 9 8 8 9 6 7 9 5 6 9 2 3 9 9 2 9 7 1 9 5 0 9 1 0 9 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ) d e u n i t n o C ( - - 0 0 7 7 1 1 - - c n I s e c i v r e S l a i c n a n i F n o s d i v a D - y e l r a H C L P d e r e t r a h C d r a d n a t S G A k n a b l l o r t n o K e h c s i h c i e r r e t s e O / Y N A U k n a b o b a R e v e i t a r e p o o C P L n o i s s i m s n a r T n r e t s a E s a x e T o C r e w o P a l e h a g n o n o M g n i d n u F l a b o l G e f i L n a i d r a u G C L P k n a B C B S H c n I A S U C B S H p r o C S B C p r o C e c n a t p e c c A r o t o M n a s s i N e h T / o C n o i n U n r e t s e W c n I n o s i d E d e t a d i l o s n o C C L L g n i d n u F e r o c n e l G y g r e n E a r p m e S p r o C t s a c m o C c n I p u o r G e s i r p r e t n E e c i v r e S c i l b u P u a b f u a r e d e i W r e u f t l a t s n a t i d e r K c n I s o C n a n n e L c M & h s r a M o C r e p a P l a n o i t a n r e t n I d t L a d a n a C e c n a n i F e r o c n e l G k n a B t n e m p o l e v e D n a c i r f A P L g n i t a r e p O P R E d t L s r e m r a f s e W o C n o s i d E h t l a e w n o m m o C g n i d n u F l a b o l G e n e h t A p r o C l a n o i t a N n l o c n i L A S A l i o t a t S c n I n e g o i B o C y g r e n E y a w a h t a H e r i h s k r e B d t L s g n i d l o H t n e c n e T p r o C l a t i p a C s e r A p u o r G m u n U o C c i r t c e l E l a r e n e G c n I s e c r u o s e R G O E c n I o C & k c r e M c n I A C c n I s t e k r a M l a b o l G e o b C c n I s a s n a k r A y g r e t n E C L L c i f i c a P - a i g r o e G g n i d n u F l a b o l G G A I p r o C X T A G p r o C y g r e t n E s g n i d l o H a c i r e m A f o p r o C y r o t a r o b a L p r o C l a t i p a C e r e e D n h o J e h T / c n I t o p e D e m o H e h T / o C r e k c u m S M J P L s g n i d l o H a c i r e m A f o t s u r T e r a c h t l a e H c n I s e i t r e p o r P l i a t e R l a n o i t a N A N A S U k n a B e n O l a t i p a C C L L s s e r g o r P y g r e n E e k u D c n I g n i d n u F l a t i p a C L P P V C e d B A S a s m e F a l o C - a c o C p r o C n i t r a M d e e h k c o L o C g n i t a r e n e G c i r t c e l E n r e h t u o S p r o C e c n a n i F d t L e g n u B c n I s a x e T y g r e t n E d t L T I L X p r o C n o s s e K c M l a b o l G C M S T ) d e u n i t n o C ( - - 1 1 7 7 1 1 - - e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 4 9 8 4 8 8 3 6 8 8 5 8 9 4 8 6 3 8 5 3 8 9 1 8 7 1 8 2 1 8 2 1 8 5 0 8 2 0 8 4 9 7 4 9 7 3 9 7 5 8 7 9 7 7 3 5 7 7 3 7 0 2 7 9 1 7 5 1 7 4 1 7 6 0 7 0 0 7 0 0 7 8 9 6 8 9 6 7 9 6 7 8 6 1 8 6 5 7 6 9 5 6 8 5 6 9 4 6 6 4 6 4 4 6 2 4 6 7 3 6 1 3 6 1 3 6 8 2 6 3 1 6 2 1 6 2 1 6 0 1 6 4 0 6 8 9 5 2 9 5 1 9 5 8 8 5 8 7 5 6 7 5 3 7 5 2 5 5 0 5 5 8 4 5 2 4 5 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 4 9 8 4 8 8 3 6 8 8 5 8 9 4 8 6 3 8 5 3 8 9 1 8 7 1 8 2 1 8 2 1 8 5 0 8 2 0 8 4 9 7 4 9 7 3 9 7 5 8 7 9 7 7 3 5 7 7 3 7 0 2 7 9 1 7 5 1 7 4 1 7 6 0 7 0 0 7 0 0 7 8 9 6 8 9 6 7 9 6 7 8 6 1 8 6 5 7 6 9 5 6 8 5 6 9 4 6 6 4 6 4 4 6 2 4 6 7 3 6 1 3 6 1 3 6 8 2 6 3 1 6 2 1 6 2 1 6 0 1 6 4 0 6 8 9 5 2 9 5 1 9 5 8 8 5 8 7 5 6 7 5 3 7 5 2 5 5 0 5 5 8 4 5 2 4 5 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - t s u r T h g u o r h T s s a P A s s a l C 1 - 7 0 0 2 s e n i l r i A l a t n e n i t n o C C L L a n a i s i u o L s e t a t S f l u G y g r e t n E 2 t s u r T p u o r G e r t n e c S / 1 t s u r T p u o r G e r t n e c S d t L s d n a l s I n a m y a C I e c n a n i F s e g r o G e e r h T p r o C c i r t c e l E & s a G r e t s e h c o R P L y t l a e R o d a n r o V o C X T T o C r e w o P o i h O V N k n a B G N I C L L e c n a n i F y t l a i c e p S S I X A P L s r e n t r a P K O E N O C L L e c n a n i F t o v i P c e t i c n I p r o C l a i c n a n i F e f i l u n a M P L s r e n t r a P y g r e n E a r t c e p S c n I d r a z z i l B n o i s i v i t c A d t L l a t i p a C c e p o n i S c n I u d i a B C L L s r e w o T e l t s a C n w o r C C L L s s e r g o r P y g r e n E e k u D d t L s e n i l e p i P T P A C L L o C E G a s e h g u H r e k a B o C y g r e n E E T D p r o C e c n a n i F a d n o H n a c i r e m A A S l a n o i t a n r e t n I l a t i p a C l a t o T o C y a w l i a R n r e h t u o S k l o f r o N p r o C r o c u N C L P n o A c n I s e i t i u q E e t a t s E l a e R a i r d n a x e l A c n I n a w e h c t a k s a S f o p r o C h s a t o P c n I p u o r G e l p p a n S r e p p e P r D c n I p u o r G s e i t i r u c e S a w i a D V C e d B A S o b m B o p u r G i P L y t r e p o r P y t r e b i L p r o C o c d l o H A S U C B R o C r e w o P a i g r o e G p r o C e v i t r o F p r o C s e i g o l o n h c e T e f i L d t L n o i t a i v A C O B p r o C k r a l C - y l r e b m K i o C s s e r p x E n a c i r e m A c n I p u o r G a i r t l A c n I C B A c n I s e i t i n u m m o C y a B n o l a v A C L P e c n a n i F y t l a i c e p S S I X A P L s t r o s e R & s l e t o H t s o H d t L k n a B o h u z i M s n i d r a j s e D e l a r t n e C e s s i a C P L s e i t r e p o r P n o t s o B p r o C e c n a n i F d t L e g n u B p r o C l i b o M n o x x E c n I r o g i l b O - o C s e h g u H r e k a B / C L L o C E G a s e h g u H r e k a B t s u r T h g u o r h T s s a P 1 - A s s a l C 1 - 0 0 0 2 s e n i l r i A l a t n e n i t n o C c n I k r o Y w e N f o o C n o s i d E d e t a d i l o s n o C H O / c n I s e r a h s c n a B n o t g n i t n u H c n I d r a c r e t s a M c n I e f i L t e M t s u r T t n e m t s e v n I y t l a e R l a r e d e F c n I s e r o t S t r a M - l a W d t L e c n a n i F C O O N C l a b o l G C M S T e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 6 3 5 2 2 5 1 2 5 7 1 5 6 1 5 2 1 5 4 0 5 3 0 5 1 0 5 1 0 5 1 0 5 0 0 5 6 8 4 3 7 4 0 7 4 6 6 4 3 6 4 8 5 4 4 5 4 7 3 4 4 3 4 1 3 4 1 3 4 5 1 4 5 1 4 9 9 3 6 9 3 4 9 3 1 9 3 0 9 3 2 8 3 7 7 3 4 6 3 2 6 3 1 5 3 5 2 3 2 2 3 4 1 3 3 0 3 8 9 2 4 9 2 9 8 2 9 8 2 8 8 2 9 7 2 2 5 2 9 4 2 3 4 2 7 3 2 7 3 2 8 2 2 7 2 2 3 2 2 0 1 2 6 0 2 1 0 2 9 9 1 1 6 1 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 6 3 5 2 2 5 1 2 5 7 1 5 6 1 5 2 1 5 4 0 5 3 0 5 1 0 5 1 0 5 1 0 5 0 0 5 6 8 4 3 7 4 0 7 4 6 6 4 3 6 4 8 5 4 4 5 4 7 3 4 4 3 4 1 3 4 1 3 4 5 1 4 5 1 4 9 9 3 6 9 3 4 9 3 1 9 3 0 9 3 2 8 3 7 7 3 4 6 3 2 6 3 1 5 3 5 2 3 2 2 3 4 1 3 3 0 3 8 9 2 4 9 2 9 8 2 9 8 2 8 8 2 9 7 2 2 5 2 9 4 2 3 4 2 7 3 2 7 3 2 8 2 2 7 2 2 3 2 2 0 1 2 6 0 2 1 0 2 9 9 1 1 6 1 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ) d e u n i t n o C ( - - 2 2 7 7 1 1 - - m a r g o r P e t o N m r e T - m u i d e M S U s a b i r a P P N B / s a b i r a P P N B p r o C X R O I I I g n i d n u F l a b o l G l a u t u M s s a M e h T / o C c i r t c e l E t t e s n a g a r r a N c n I y g r e n E t n i o P r e t n e C c n I a c i r e m o C p r o C n o t a E o C y a w l i a R c i f i c a P n a i d a n a C o C r e w o P o c i x e M w e N - s a x e T y t e i c o S g n i d l i u B e d i w n o i t a N d t L s e n i L e p i P a d a n a C s n a r T d t L p u o r G s h t r o w l o o W p r o C y g r e n E o r e l a V c n I x a f i u q E c n I e r i p S B A k n a b d e w S o C n o t r u b i l l a H C L L C L L e c n a n i F a c i r e m A f o p u o r G n e g a w s k l o V c n I p u o r G l a i c n a n i F a r a g a i N t s r i F c n I s e c i v r e S l a i c n a n i F e d i w n o i t a N p r o C s e c r u o s e R y g r e n E t n i o P r e t n e C c n I p u o r G l a i c n a n i F p r o C n a t S p r o C n o A o C r e w o P n r e h t u o S C L L t i d e r C M B I e h T / c n I p u o r G s e c i v r e S l a i c n a n i F d r o f t r a H c n I e s i r p r e t n E l a s r e v i n U C B N p r o C y g r e n E S M C o C t h g i L & r e w o P y t i C s a s n a K d t L a d a n a C e c n a n i F r e g r e b m u l h c S c n I s g n i d l o H s m e t s y S E A B o C & y l l i L i l E c n I s g n i d l o H a r u m o N C L L e c n a n i F D M E C L P k n a B s y a l c r a B p r o C l o n e h p m A c n I s e c i v r e S n o i t a m r o f n I l a n o i t a N y t i l e d i F a i l a r t s u A f o k n a B h t l a e w n o m m o C p r o C l a t i p a C t s e W e l c a n n i P E S c i r t c e l E r e d i e n h c S C L L V W M k c o R t s e W p r o C e f i L e v i t c e t o r P C L P e c y o R - s l l o R c n I t n a r u s s A G A k n a B e h c s t u e D c n I s m e t s y S o c s i C 6 6 s p i l l i h P c n I p p A t e N p r o C i f i c a P c n I y a B e c n I e c n a i l l A s t o o B s n e e r g l a W c n I o C r e w o P c i r t c e l E n a c i r e m A o C r e w o P c i r t c e l E n r e t s e w h t u o S c n I l a i c n a n i F l a i t n e d u r P p r o C g n i d l o H e d a r t i r e m A D T p r o C s r e t n e C y c n e g e R p r o C l a i c n a n i F n o t l u F C L L e F a t n a S n r e h t r o N n o t g n i l r u B l a b o l G C M S T e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 0 6 1 5 3 1 0 2 1 9 7 2 2 5 1 , 4 9 9 3 4 1 , 3 4 9 0 0 1 , 4 7 7 0 0 1 , 3 6 3 0 5 , 7 7 2 0 5 , 6 3 2 0 5 , 5 0 0 0 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 0 3 4 , 3 6 5 1 0 6 2 , $ S U $ S U 3 2 1 0 9 5 , 7 1 1 3 3 2 , 1 4 7 1 1 1 , 4 5 2 8 2 , 7 4 1 , 6 5 6 8 , 3 4 0 0 , 3 0 9 9 , 2 1 5 5 , 2 7 3 5 , 1 0 8 1 , 1 4 9 8 3 1 3 8 2 3 8 4 , 2 2 7 5 4 , 1 1 2 9 3 , 0 6 0 1 3 , 4 4 5 2 2 , 8 0 8 0 2 , 4 0 9 3 1 , 2 9 7 2 1 , 4 3 2 2 1 , 2 0 0 2 1 , 1 3 4 1 1 , 3 5 9 0 1 , 1 2 8 0 1 , 9 5 3 0 1 , 9 4 0 0 1 , 5 3 3 , 9 9 7 1 , 9 7 8 7 , 8 7 4 0 , 8 9 0 5 , 7 4 1 1 , 7 1 0 0 , 7 9 5 8 , 6 9 6 7 , 6 9 4 7 , 6 8 2 7 , 6 1 1 5 , 6 1 6 9 , 5 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 0 6 1 5 3 1 0 2 1 5 0 0 0 5 1 , 2 4 0 2 4 1 , 0 0 0 0 0 1 , 0 0 0 0 0 1 , 0 0 0 0 5 , 0 0 0 0 5 , 0 9 9 9 4 , 0 0 0 0 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 0 3 4 , 3 6 5 1 0 6 2 , $ S U $ S U 3 2 1 0 9 5 , 7 1 1 3 3 2 , 1 4 7 1 1 1 , 4 5 2 8 2 , 7 4 1 , 6 5 6 8 , 3 4 0 0 , 3 0 9 9 , 2 1 5 5 , 2 7 3 5 , 1 0 8 1 , 1 4 9 8 3 1 3 8 2 3 8 4 , 2 2 7 5 4 , 1 1 2 9 3 , 0 6 0 1 3 , 4 4 5 2 2 , 8 0 8 0 2 , 4 0 9 3 1 , 2 9 7 2 1 , 4 3 2 2 1 , 2 0 0 2 1 , 1 3 4 1 1 , 3 5 9 0 1 , 1 2 8 0 1 , 9 5 3 0 1 , 9 4 0 0 1 , 5 3 3 , 9 9 7 1 , 9 7 8 7 , 8 7 4 0 , 8 9 0 5 , 7 4 1 1 , 7 1 0 0 , 7 9 5 8 , 6 9 6 7 , 6 9 4 7 , 6 8 2 7 , 6 1 1 5 , 6 1 6 9 , 5 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A " " s t e s s a l a i c n a n i f y t i r u t a m - o t - d l e H " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A " " " " " " " " " " " " " " " " " " " " " " " " " " " - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ) d e u n i t n o C ( - - 3 3 7 7 1 1 - - s e t a c i f i t r e C h g u o r h T s s a P d e r u t c u r t S y l i m a f i t l u M c a M e i d d e r F n o i t a i c o s s A e g a g t r o M l a n o i t a N t n e m n r e v o G s k n a B n a o L e m o H l a r e d e F e a M e i n n i G s e i t i r u c e s d e k c a b - e g a g t r o m y c n e g A / s d n o b y c n e g A e a M e i n n a F c a M e i d d e r F 1 V E R - 4 1 0 2 t i d e r C d r o F / t s u r T r e n w O o t u A t i d e r C d r o F 2 C - 2 1 0 2 t s u r T e g a g t r o M l a i c r e m m o C s y a l c r a B - S B U t s u r T r e t s a M t n u o c c A t i d e r C s s e r p x E n a c i r e m A A t s u r T r e n w O r e t s a M n a l p r o o l F t i d e r C d r o F t s u r T n o i t u c e x E t e s s A - i t l u M e n O l a t i p a C t s u r T h c n y L l l i r r e M a c i r e m A f o k n a B y e l n a t S n a g r o M t s u r T r e n w O C - 4 1 0 2 s e l b a v i e c e R o t u A a t o y o T t s u r T e g a g t r o M M M O C C L L I I g n i d n u F e k a e p a s e h C t s u r T d r a C t i d e r C A B 7 P J - 7 1 0 2 t s u r T s e i t i r u c e S e g a g t r o M l a i c r e m m o C C C M P J A - 7 1 0 2 t s u r T n o i t a z i t i r u c e S e s a e L o t u A i a d n u y H t s u r T r e n w O 2 - 7 1 0 2 s e l b a v i e c e R o t u A a d n o H 3 - 5 1 0 2 t s u r T g n i s a e L e l i b o m o t u A l a i c n a n i F M G t s u r T r e n w O r e t s a M z n e B - s e d e c r e M 2 R - 0 1 0 2 t s u r T s e t o N d e e t n a r a u G A U C N a e r o K f o k n a B t r o p m I - t r o p x E a d a n a C t n e m p o l e v e D t r o p x E a d a n a C c e b e u Q f o e c n i v o r P s k n a B t i d e r C m r a F l a r e d e F c n I l a t i p a C B I P P C - A M N G C M L H F t s u r T e c n a u s s I d r a C t i d e r C k n a b i t i C t s u r T e t o N n o i t u c e x E d r a C r e v o c s i D s e i t i r u c e s d e k c a b - t e s s A t s u r T e c n a u s s I e s a h C a n i h C f o k n a B l a i c r e m m o C d n a l a i r t s u d n I a i l a r t s u A f o k n a B h t l a e w n o m m o C k n a B a i l a r t s u A l a n o i t a N a i t o c S a v o N f o k n a B d n o B l a n o i t a n r e t n I t n e m n r e v o G i b a h D u b A d n o B / e t o N y r u s a e r T s e t a t S d e t i n U d n o b t n e m n r e v o G p r o C e c n a n i F y a w a h t a H e r i h s k r e B a c i r e m A f o p r o C g n i g a k c a P C L L a d i r o l F y g r e n E e k u D o C & o g r a F s l l e W . c n I , p u o r G s h c a S n a m d l o G . p r o C g n i k n a B c a p t s e W . o C & e s a h C n a g r o M P J l a b o l G C M S T 2 1 C - 3 1 0 2 t s u r T s e i t i r u c e S e g a g t r o M l a i c r e m m o C B B M P J 1 1 C G - 3 1 0 2 t s u r T e g a g t r o M l a i c r e m m o C p u o r g i t i C s e l b a v i e c e R t s u r T r e n w O r e t s a M n a s s i N t s u r T s e l b a v i e c e R o t u A i a d n u y H t s u r T e s a e L e l c i h e V W M B t s u r T s e i t i r u c e S e g a g t r o M S G t s u r T r e n w O o t u A t i d e r C d r o F t s u r T e s a e L o t u A n a s s i N C O B I - 7 1 0 2 t s u r T e g a g t r o M l a i c r e m m o C B B D G C K N A B e t o N e u l a V r i a F s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i f o e g a t n e c r e P ) % ( p i h s r e n w O e u l a V g n i y r r a C s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i s t i n U / s e r a h S ) s d n a s u o h T n I ( 7 1 0 2 , 1 3 r e b m e c e D t n u o c c A t n e m e t a t S l a i c n a n F i y n a p m o C e h t h t i i w p h s n o i t a l e R e m a N d n a e p y T s e i t i r u c e S e l b a t e k r a M e m a N y n a p m o C d l e H 3 6 8 , 4 8 2 5 , 4 0 7 9 , 3 1 1 8 , 3 4 2 6 , 3 6 8 4 , 3 4 3 4 , 3 9 0 0 , 3 7 7 8 , 2 2 4 4 , 2 6 0 0 , 2 0 2 8 , 1 3 1 5 , 1 8 9 9 5 4 8 1 3 8 1 0 5 5 8 4 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 4 4 7 9 4 , $ S U 0 0 0 , 2 0 0 0 , 2 0 0 0 , 1 $ S U $ S U $ S U 5 3 6 5 6 , $ S U 0 0 8 $ S U 0 7 1 $ S U 9 0 2 , 5 7 0 6 , 2 8 6 1 , 2 9 3 3 $ S U $ S U $ S U $ S U - - - ) d e d u l c n o C ( 0 7 3 $ S U 4 8 3 $ S U A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / 4 1 1 - 1 4 2 0 2 3 4 4 - - 3 6 8 , 4 8 2 5 , 4 0 7 9 , 3 1 1 8 , 3 4 2 6 , 3 6 8 4 , 3 4 3 4 , 3 9 0 0 , 3 7 7 8 , 2 2 4 4 , 2 6 0 0 , 2 0 2 8 , 1 3 1 5 , 1 8 9 9 5 4 8 1 3 8 1 0 5 5 8 4 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 0 0 0 0 5 , $ S U 0 0 0 , 2 0 0 0 , 2 0 0 0 , 1 $ S U $ S U $ S U 5 3 6 5 6 , $ S U - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A s t e s s a l a i c n a n i f y t i r u t a m - o t - d l e H " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A t s o c t a d e i r r a c s t e s s a l a i c n a n i F 0 0 8 $ S U 0 0 6 , 1 t s o c t a d e i r r a c s t e s s a l a i c n a n i F 0 7 1 $ S U 7 4 1 , 4 t s o c t a d e i r r a c s t e s s a l a i c n a n i F - - - 9 0 2 , 5 7 0 6 , 2 8 6 1 , 2 9 3 3 $ S U $ S U $ S U $ S U 0 6 4 3 0 9 3 6 9 5 8 0 , 1 0 3 2 8 7 2 4 6 2 " " s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A t s o c t a d e i r r a c s t e s s a l a i c n a n i F t s o c t a d e i r r a c s t e s s a l a i c n a n i F t s o c t a d e i r r a c s t e s s a l a i c n a n i F t s o c t a d e i r r a c s t e s s a l a i c n a n i F 0 7 3 $ S U 1 2 2 t s o c t a d e i r r a c s t e s s a l a i c n a n i F 4 8 3 $ S U 0 3 2 t s o c t a d e i r r a c s t e s s a l a i c n a n i F - - 4 4 7 7 1 1 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - A - 7 1 0 2 t s u r T r e n w O r e t s a M t n e m p i u q E l a i c n a n i F o v l o V 0 2 C L - 5 1 0 2 t s u r T e g a g t r o M l a i c r e m m o C o g r a F s l l e W 7 C - 7 1 0 2 t s u r T s e i t i r u c e S e g a g t r o M l a i c r e m m o C B D M P J t s u r T r e n w O r e t s a M n a l p r o o l F W M B C L L A O C M S C 1 - 7 1 0 2 e l i b o m o t u A r e m u s n o C l a i c n a n i F M G t s u r T e s a e L o t u A t i d e r C d r o F 3 E C I - 7 1 0 2 t s u r T e g a r o t S d l o C P L g n i d n u F e s a e L t e e l F z t r e H C L L 2 V P S s l e e h W 1 C - 1 1 0 2 t s u r T e g a g t r o M l a i c r e m m o C E R C F C A - 6 1 0 2 t s u r T e s a e L o t u A z n e B - s e d e c r e M t s u r T I l a t i p a C y e l n a t S n a g r o M t s u r T e g a g t r o M e u n e v A k r a P 0 8 2 C L L g n i c n a n i F t e e l F e s i r p r e t n E 1 - 5 1 0 2 t s u r T s e l b a v i e c e R o t u A z n e B - s e d e c r e M 4 1 C - 3 1 0 2 t s u r T e g a g t r o M l a i c r e m m o C S B R F W J F U i h s i b u s t i M - o y k o T f o k n a B t c u d o r p e r u t c u r t S J F U i h s i b u s t i M - o y k o T f o k n a B l t s n I e l a r e n e G e t e i c o S r e p a p l a i c r e m m o C k n a B n i k u h c n i r o N d n u F t s u r T r e n w O B - 7 1 0 2 s e l b a v i e c e R o t u A n a s s i N l a b o l G C M S T . . P L I I d n u F l a t i p a C a r e v a m i r P . p r o C g n i t h g i L s d e L d i u q i L k c o t s n o m m o C I I I F A T V . c n I , s e i g o l o n h c e T V 5 . c n I , s m e t s y S r e h t e A k c o t s d e r r e f e r P . c n I , x i n o c o e N k c o t s n o m m o C a i t n a u q A c i l e t n e S k c o t s d e r r e f e r P . c n I , s c i n o S k c o t s n o m m o C . c n I , s c i n o S k c o t s d e r r e f e r P . c n I , s c i n o S k c o t s n o m m o C . c n I , m u i v o n n I k c o t s d e r r e f e r P . c n I , m u i v o n n I I I F A T V F D S I I I F D S I d n u F h t w o r G 4 E L B A T ) 1 e t o N ( e c n a l a B g n i d n E t n u o m A ) s d n a s u o h T n I ( l a s o p s i D s t i n U / s e r a h S n o s s o L / n i a G e u l a V g n i y r r a C t n u o m A s t i n U / s e r a h S ) s d n a s u o h T n I ( t n u o m A s t i n U / s e r a h S ) s d n a s u o h T n I ( t n u o m A s t i n U / s e r a h S ) s d n a s u o h T n I ( l a s o p s i D n o i t i s i u q c A e c n a l a B g n n n i i g e B f o e r u t a N i p h s n o i t a l e R y t r a p - r e t n u o C t n e m e t a t S l a i c n a n i F t n u o c c A s e i t i r u c e S e l b a t e k r a M e m a N d n a e p y T e m a N y n a p m o C L A T I P A C N I - D I A P E H T F O % 0 2 R O N O I L L I M 0 0 3 $ T N T S A E L T A F O S E C I R P R O S T S O C T A F O D E S O P S I D D N A D E R I U Q C A S E I T I R U C E S E L B A T E K R A M ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F s e e t s e v n I d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T $ , 0 0 0 0 6 9 , 1 $ , 0 0 0 0 6 9 , 1 $ 0 0 0 0 0 4 , 0 0 0 0 0 4 , - - - - $ - - 0 5 2 , 0 0 4 3 0 3 , 7 6 9 , 1 $ - - 0 0 0 , 0 5 3 0 1 , 0 0 0 , 0 5 3 0 1 , 5 3 0 , 1 1 7 7 , 5 9 6 , 1 0 7 1 6 7 1 , 8 2 6 , 8 5 6 8 - - - 0 1 0 , 3 8 6 , 0 6 2 9 2 7 , 4 3 6 , 5 6 2 4 9 0 , 1 3 3 , 6 7 - y r a i d i s b u S y r a i d i s b u S - - - , 7 7 8 1 1 2 9 0 3 , 0 4 7 , 3 9 4 6 2 , $ - - - 9 - 6 7 8 0 4 , $ S U 1 1 9 9 2 , 7 6 8 6 2 , 9 5 1 6 2 , 9 0 7 2 2 , 5 0 5 8 1 , 8 9 2 8 1 , 2 3 7 7 1 , 4 2 0 7 1 , 3 6 4 6 1 , 2 2 7 2 1 , 4 1 2 2 1 , 3 1 6 1 1 , 3 7 0 1 1 , 1 0 3 , 9 6 6 8 , 6 9 1 7 , 2 8 0 6 , 1 9 9 0 , 1 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - , 9 8 6 2 0 2 $ S U 1 0 9 9 4 , $ S U 7 9 9 , 2 $ S U ) d e u n i t n o C ( - - - - - - - - - - - - - - - - - - - - - - - - 8 2 $ S U 9 9 2 , 9 - - - - - - - - 2 5 5 5 1 , $ S U - - - ) 4 3 1 ( $ S U 5 0 2 8 1 , $ S U 1 7 0 8 1 , $ S U ) 7 1 ( ) 3 1 ( ) 6 7 ( ) 7 0 1 ( 5 4 ) 2 5 ( ) 1 2 1 ( - ) 8 ( - 1 - ) 1 ( 4 8 3 1 7 5 6 8 ) 6 6 2 ( $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 3 3 8 , 5 8 3 4 , 6 6 7 9 , 1 3 7 9 , 8 8 5 2 2 1 , 6 1 0 , 2 3 6 1 5 1 , - 2 6 8 - 0 0 2 - 8 9 9 , 1 2 9 9 , 4 8 4 5 , 3 5 9 4 0 1 , 6 0 6 0 1 , 0 7 5 0 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 6 1 8 , 5 5 2 4 , 6 0 0 9 , 1 8 1 0 , 9 1 5 1 2 1 , 4 6 9 , 1 2 4 0 5 1 , - 4 5 8 - 1 0 2 - 7 9 9 , 1 6 7 0 , 5 1 6 5 , 3 2 5 5 0 1 , 0 4 3 0 1 , 6 5 6 0 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U ) 1 6 6 ( $ S U 4 1 5 4 9 3 , $ S U 3 5 8 3 9 3 , $ S U 3 1 1 $ S U 7 8 4 3 6 1 , $ S U 0 0 6 3 6 1 , $ S U 0 1 4 3 ) 2 7 1 ( $ S U $ S U $ S U 7 8 1 5 2 , 8 7 6 7 9 , 5 1 5 7 2 , $ S U $ S U $ S U 7 9 1 5 2 , 2 1 7 7 9 , 3 4 3 7 2 , $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - 2 9 8 , 4 2 7 , 1 2 4 1 9 , 0 3 $ S U 5 5 9 , 8 1 3 3 9 , 9 1 0 3 0 , 6 1 1 1 2 , 7 1 5 1 1 , 6 1 0 5 2 , 6 1 9 4 8 , 1 1 4 4 1 , 7 1 7 3 7 , 4 1 3 8 6 , 2 1 2 6 7 , 0 1 0 0 6 , 1 1 8 7 0 , 1 1 9 7 2 , 1 1 5 2 4 , 0 1 5 9 9 , 5 - - $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 2 5 5 , 6 9 3 $ S U 9 2 6 , 2 8 1 $ S U 0 8 1 , 8 2 8 7 6 , 7 9 0 6 0 , 8 $ S U $ S U $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - 3 7 9 , 7 2 $ S U 9 1 8 , 6 1 2 3 3 , 3 1 0 3 3 , 2 2 0 9 3 , 7 7 3 2 , 1 1 9 5 0 , 7 1 7 7 8 , 7 - $ S U $ S U $ S U $ S U $ S U $ S U $ S U 7 0 6 , 2 $ S U - 4 0 7 , 1 $ S U - - 4 9 9 , 1 5 0 9 , 2 0 8 1 , 7 0 5 8 , 1 1 8 1 6 , 1 1 $ S U $ S U $ S U $ S U $ S U 5 8 2 , 5 9 1 $ S U 6 5 7 , 0 3 $ S U - - 9 4 3 , 9 1 $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - 5 5 7 7 1 1 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 8 7 0 , 6 $ S U 9 9 2 , 9 y r a i d i s b u S 2 e t o N - - - - - l a i c n a n i f y t i r u t a m - o t - d l e H n a w i a T , n o i t a r o p r o C C P C s t e s s a " . d t L , . o C . d n I n o i s i c e r P i a H n o H d n o b e t a r o p r o C C M S T l a i c n a n i f y t i r u t a m - o t - d l e H s t e s s a " r o f d e t n u o c c a s t n e m t s e v n I d o h t e m y t i u q e g n i s u r o f d e t n u o c c a s t n e m t s e v n I d o h t e m y t i u q e g n i s u y n a p m o C r e w o P n a w i a T r e p a p l a i c r e m m o C l a b o l G C M S T k c o t S g n i j n a N C M S T I I F D S I k c o t S s r e n t r a P C M S T s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A p r o C a c i r e m A f o k n a B d n o b e t a r o p r o C l a b o l G C M S T " " " " " " " " " " " " " " " " " " e h T / c n I p u o r G s h c a S n a m d l o G o C & e s a h C n a g r o M P J c n I s n o i t a c i n u m m o C n o z i r e V C L L o C t i d e r C r o t o M d r o F y e l n a t S n a g r o M c n I p u o r g i t i C c n I T & T A k n a B t n e m p o l e v e D n a i s A o C & e s a h C n a g r o M P J C L L l a t i p a C S U W M B c n I s e c n e i c S d a e l i G c n I M M O C L A U Q p r o C t f o s o r c i M c n I a n t e A p r o C l a t i p a C T A B y e l n a t S n a g r o M c n I s d o o F n o s y T c n I e l p p A d n o b t n e m n r e v o G s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A d n o B / e t o N y r u s a e r T s e t a t S d e t i n U " " " " g n i t a o l F y r u s a e r T s e t a t S d e t i n U e t o N e t a R n o i t a l f n I y r u s a e r T s e t a t S d e t i n U l l i B y r u s a e r T s e t a t S d e t i n U l l i B y r u s a e r T s e t a t S d e t i n U s d n o B d e x e d n I ) 1 e t o N ( e c n a l a B g n i d n E t n u o m A ) s d n a s u o h T n I ( l a s o p s i D s t i n U / s e r a h S n o s s o L / n i a G e u l a V g n i y r r a C t n u o m A s t i n U / s e r a h S ) s d n a s u o h T n I ( t n u o m A s t i n U / s e r a h S ) s d n a s u o h T n I ( t n u o m A s t i n U / s e r a h S ) s d n a s u o h T n I ( l a s o p s i D n o i t i s i u q c A e c n a l a B g n n n i i g e B f o e r u t a N i p h s n o i t a l e R y t r a p - r e t n u o C t n e m e t a t S l a i c n a n i F t n u o c c A s e i t i r u c e S e l b a t e k r a M e m a N d n a e p y T e m a N y n a p m o C 6 2 5 9 4 , $ S U 5 7 2 1 4 , 9 0 1 8 1 , 9 3 7 6 1 , 2 1 0 6 1 , 8 5 7 5 1 , 2 1 5 4 1 , 5 1 4 4 1 , 6 6 8 , 2 8 7 3 , 2 5 1 0 , 2 5 4 1 6 2 4 1 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U - - - - - - 8 2 3 8 4 , $ S U 2 2 7 5 4 , $ S U 1 1 2 9 3 , 4 4 5 2 2 , $ S U $ S U 8 0 8 0 2 , $ S U 1 2 8 0 1 , $ S U 5 3 6 5 6 , $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - ) d e d u l c n o C ( - ) 6 ( ) 3 4 ( ) 7 1 2 ( ) 1 7 ( ) 5 3 ( ) 3 4 ( ) 0 1 ( ) 6 0 1 ( - 5 7 1 ) 9 ( 0 9 5 6 7 2 ) 3 ( ) 0 4 ( $ - $ - $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 7 8 8 3 5 6 2 8 , 1 0 1 3 2 1 4 1 1 0 3 3 3 4 , 0 1 0 , 1 6 0 4 2 6 , 8 0 8 9 3 , 2 9 6 6 3 , 6 9 0 7 2 , 1 2 7 1 2 , 8 2 1 1 1 , 4 0 4 4 5 1 , 8 7 5 2 5 1 , 1 2 1 2 1 , 4 4 5 2 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 1 8 5 9 4 9 0 6 , 1 - 0 8 3 4 5 9 2 3 4 , 4 0 9 6 0 4 2 6 , 3 1 8 9 3 , 9 0 7 6 3 , 7 8 0 7 2 , 6 2 7 1 2 , 4 3 1 1 1 , 4 9 4 4 5 1 , 5 0 6 2 5 1 , 1 8 0 2 1 , 1 4 5 2 1 , $ S U $ S U $ S U $ S U $ S U $ S U $ $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U ) 9 9 1 ( $ S U 6 6 7 , 7 $ S U 7 6 5 , 7 $ S U ) 2 1 ( 3 ) 1 8 ( 3 ) 9 ( - $ S U 3 0 0 4 1 , $ S U 1 9 9 3 1 , $ S U $ S U $ S U 4 0 6 2 1 , 4 8 3 8 1 , $ S U $ S U 7 0 6 2 1 , 3 0 3 8 1 , $ S U $ S U $ S U 4 2 9 , 5 $ S U 7 2 9 , 5 $ S U $ S U 6 1 4 4 1 , $ S U 7 0 4 4 1 , $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - - - 9 1 6 , 9 4 $ S U 2 2 3 , 3 4 7 2 8 , 8 1 7 9 4 , 6 1 7 7 7 , 5 1 4 3 1 , 9 5 7 7 8 , 4 1 2 5 3 , 4 1 0 2 5 , 2 1 9 7 2 , 5 6 4 9 1 , 2 4 0 1 7 , 8 3 1 4 2 , 7 2 1 2 7 , 1 2 8 2 1 , 1 1 4 0 4 , 4 5 1 8 7 5 , 2 5 1 3 2 1 , 2 1 4 4 5 , 2 1 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 2 0 4 , 3 3 $ S U 5 5 6 , 6 3 $ S U 4 1 2 , 1 8 3 5 , 0 2 $ S U $ S U 3 9 7 , 4 1 $ S U 4 8 7 , 7 $ S U 1 5 8 , 1 4 $ S U 3 5 7 4 1 , $ S U 7 0 2 , 3 $ S U 0 6 9 7 1 , $ S U 1 8 5 , 6 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - $ - 0 1 $ S U 5 8 5 , 2 2 $ S U 6 7 0 , 3 2 $ S U 6 7 2 , 1 3 6 2 6 , 9 3 $ S U $ S U 4 4 9 , 1 1 $ S U 5 6 4 , 7 1 $ S U 4 8 7 , 3 2 $ S U - - - - - - - - - - - - - - - - - - - - - - - - - - 7 8 3 , 6 $ S U 1 8 5 , 6 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - " " " " " " " " " " " " " " " " " " e g a g t r o M l a n o i t a N t n e m n r e v o G 8 4 9 1 M B L O O P A M N F 6 8 8 1 M B L O O P A M N F e g a g t r o M l a n o i t a N t n e m n r e v o G 5 . 4 r Y 0 3 A B T A M N F e a M e i n n a F n o i t a i c o s s A e a M e i n n a F 3 0 9 9 L A L O O P A M N F 5 . 3 r Y 0 3 A B T A M N F 4 r Y 0 3 A B T I I A M N G 3 r Y 5 1 A B T A M N F 5 . 3 r Y 0 3 A B T I I A M N G n o i t a i c o s s A 3 4 5 r Y 0 3 A B T A M N F r Y 0 3 A B T A M N F r Y 0 3 A B T A M N F 5 7 3 7 0 G l o o P C P N L M H D E F 3 r Y 0 3 A B T I I A M N G k n a B n a o L e m o H l a r e d e F s e t o N t n u o c s i D s e i t i r u c e s d e k c a b - t e s s A l a i c n a n i f e l a s - r o f - e l b a l i a v A e c n a u s s I d r a C t i d e r C k n a b i t i C s t e s s a t s u r T " " " " " e t o N n o i t u c e x E d r a C r e v o c s i D r e t s a M n a l p r o o l F t i d e r C d r o F t e s s A - i t l u M e n O l a t i p a C t s u r T e c n a u s s I e s a h C t s u r T n o i t u c e x E t s u r T d r a C t i d e r C A B A t s u r T r e n w O t s u r T d n u F s t e s s a l a i c n a n i f e l a s - r o f - e l b a l i a v A 6 9 1 3 M B L O O P A M N F s e i t i r u c e s d e k c a b - e g a g t r o m y c n e g A / s d n o b y c n e g A l a b o l G C M S T t s o c t a d e i r r a c s t e s s a l a i c n a n i F . l a i c n a n i f e l a s - r o f - e l b a l i a v A s t e s s a . P L I I d n u F l a t i p a C a r e v a m i r P d e t i i m L s e i g o l o n h c e T p i h c l A k c o t S I I F D S I - - 6 6 7 7 1 1 - - . t n e m t s u j d a d e t a l e r r e h t o d n a s e e t s e v n i f o s e s s o l / s t i f o r p f o e r a h s , s t n e m t s e v n i s d n o b n o t n u o c s i d / m u i m e r p f o n o i t a z i t r o m a e h t s e d u l c n i e c n a l a b g n i d n e e h T . n r u t e r l a t i p a c f o d e t s i s n o c y l i r a m i r p s i l a s o p s i d e h T : 1 : 2 e t o N e t o N 5 E L B A T y t r a p - r e t n u o C d e t a l e R f o n o i t c a s n a r T r o i r P r e h t O s m r e T f o e s o p r u P n o i t i s i u q c A e c n e r e f e R e c i r P t n u o m A e t a D r e f s n a r T s p i h s n o i t a l e R r e n w O f o e r u t a N i s p h s n o i t a l e R y t r a p - r e t n u o C m r e T t n e m y a P n o i t c a s n a r T t n u o m A n g i e r o F ( n i s e i c n e r r u C ) s d n a s u o h T e t a D n o i t c a s n a r T f o s e p y T y t r e p o r P y n a p m o C e m a N L A T I P A C N I - D I A P E H T F O % 0 2 R O N O I L L I M 0 0 3 $ T N T S A E L T A F O S T S O C T A S E I T R E P O R P E T A T S E L A E R L A U D I V I D N I F O N O I T I S I U Q C A ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F s e e t s e v n I d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T ) d e u n i t n o C ( e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e s o p r u p d n a n o s i r a p m o c n o i t a i t o g e n e c i r p e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e s o p r u p d n a n o s i r a p m o c n o i t a i t o g e n e c i r p e s o p r u p d n a n o s i r a p m o c n o i t a i t o g e n e c i r p A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / A N / - - - - - - - - - - - - - - . d t L , . o C l a i r t s u d n I h c e T - h i y g n a U e h t y b t n e m e l t t e s y l h t n o M 0 2 6 , 2 0 3 d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a o t 6 1 0 2 , 2 2 r e b m e t p e S 7 1 0 2 , 5 r e b m e t p e S 7 1 0 2 , 8 2 H C E T I H M E T S Y S H C E T E L O H W e h t y b t n e m e l t t e s y l h t n o M 9 9 1 , 7 0 3 r e b m e c e D o t 7 1 0 2 , 3 1 y r a u n a J n o i t a r o p r o C n o i t c u r t s n o C A S A T e h t y b t n e m e l t t e s y l h t n o M 6 6 7 , 2 5 3 7 1 0 2 , 8 1 y r a u n a J D E T I M I L d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 , 4 1 e c n a t p e c c a . d t L , . o C n o i t c u r t s n o C u s T u F e h t y b t n e m e l t t e s y l h t n o M 7 7 5 , 3 3 8 , 6 r e b m e c e D o t 6 1 0 2 , 0 1 t s u g u A d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a e c n a t p e c c a . P R O C L A N O I T A N R E T N I d n a s s e r g o r p n o i t c u r t s n o c 7 1 0 2 , 2 H C E T E K R A M e h t y b t n e m e l t t e s y l h t n o M 1 5 1 , 0 1 3 r e b m e v o N o t 7 1 0 2 , 5 1 h c r a M d t L I , . o C L A R T S U D N I E I J I L e h t y b t n e m e l t t e s y l h t n o M 7 9 3 , 7 1 3 r e b m e c e D o t 7 1 0 2 , 5 1 h c r a M . d t L I , . o C L A R T S U D N I I Y N U T e h t y b t n e m e l t t e s y l h t n o M 4 5 3 , 8 5 3 r e b m e c e D o t 7 1 0 2 , 7 1 h c r a M d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 , 5 1 d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 , 5 1 . d t L , . o C t n e m p o l e v e D e n o t S d l o G e h t y b t n e m e l t t e s y l h t n o M 8 4 7 , 0 0 3 r e b m e c e D o t 7 1 0 2 , 1 2 h c r a M . p r o C c i t i r u P n a w i a T e h t y b t n e m e l t t e s y l h t n o M 6 9 9 , 3 0 3 r e b m e v o N o t 7 1 0 2 , 1 2 h c r a M d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 , 0 3 d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 , 5 2 y g o l o n h c e T l a c i m e h C k e t n u H - a c i C e h t y b t n e m e l t t e s y l h t n o M 1 9 9 , 8 5 7 r e b m e c e D o t 7 1 0 2 , 7 2 h c r a M d t L , . o C n a w i a T d n a s s e r g o r p n o i t c u r t s n o c 7 1 0 2 , 7 2 e c n a t p e c c a . d t L , . o C n o i t c u r t s n o C E G D E K e h t y b t n e m e l t t e s y l h t n o M 1 3 1 , 5 8 4 r e b m e t p e S o t 7 1 0 2 , 4 1 l i r p A d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 , 9 2 d t L , . o C l a n o i t a n r e t n I n a u Y n e h C e h t y b t n e m e l t t e s y l h t n o M 6 6 5 , 2 2 5 r e b m e v o N o t 7 1 0 2 , 8 1 l i r p A . d t L , . o C n o i t c u r t s n o C N C A D I e h t y b t n e m e l t t e s y l h t n o M 6 8 3 , 8 9 8 , 6 r e b m e c e D o t 7 1 0 2 , 5 2 y a M d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 , 9 2 d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 , 3 b a F b a F b a F b a F b a F b a F b a F b a F b a F b a F b a F b a F b a F . D T L , . O C S E C V R E S I d n a s s e r g o r p n o i t c u r t s n o c 7 1 0 2 , 5 D E T A R G E T N I D E T I N U e h t y b t n e m e l t t e s y l h t n o M 7 3 8 , 2 4 6 $ r e b m e c e D o t 6 1 0 2 , 2 t s u g u A b a F C M S T - - 7 7 7 7 1 1 - - y t r a p - r e t n u o C d e t a l e R f o n o i t c a s n a r T r o i r P r e h t O s m r e T f o e s o p r u P n o i t i s i u q c A e c n e r e f e R e c i r P t n u o m A e t a D r e f s n a r T s p i h s n o i t a l e R r e n w O f o e r u t a N i s p h s n o i t a l e R y t r a p - r e t n u o C m r e T t n e m y a P n o i t c a s n a r T t n u o m A n g i e r o F ( n i s e i c n e r r u C ) s d n a s u o h T e t a D n o i t c a s n a r T f o s e p y T y t r e p o r P y n a p m o C e m a N ) d e d u l c n o C ( e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / e n o N g n i r u t c a f u n a M e s o p r u p g n i d d i B A N / e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c e s o p r u p n o i t a i t o g e n e c i r p d n a n o s i r a p m o c A N / A N / A N / A N / A N / A N / A N / A N / A N / e n o N g n i r u t c a f u n a M e c i r p , g n i d d i B A N / A N / A N / A N / - - - - . d t L , . o C ) i a h g n a h S ( n o i t a r o c e D d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a . d t L , . o C p u o r G e y o a B i a h g n a h S e h t y b t n e m e l t t e s y l h t n o M 0 0 0 , 8 9 B M R , 7 2 e n u J o t 7 1 0 2 , 2 2 e n u J d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 r o i r e t n I g n o h c n e R e h t y b t n e m e l t t e s y l h t n o M 7 2 0 , 9 1 1 B M R 7 1 0 2 , 5 2 y a M b a F b a F d n a L f o u a e r u B l a p i c i n u M g n i j n a N t n e m y a p % 0 0 1 2 4 0 , 0 8 1 B M R 7 1 0 2 , 8 1 r e b m e c e D e s u d n a L s e c r u o s e R d n a t h g i r n o i s i v i D t s r i F n o i t c u r t s n o C a n i h C e h t y b t n e m e l t t e s y l h t n o M 0 0 3 , 3 8 1 B M R , 3 2 e n u J o t 7 1 0 2 , 1 2 h c r a M b a F C M S T & n o i t c u r t s n o C p u o r G . d t L , . o C t n e m p o l e v e D d n a s s e r g o r p n o i t c u r t s n o c e c n a t p e c c a 7 1 0 2 y n a p m o C g n i j n a N . d t L - - 8 8 7 7 1 1 - - e t o N o t % l a t o T 6 E L B A T r o e l b a y a P s t n u o c c A / s e t o N e l b a v i e c e R e c n a l a B g n i d n E ) s d n a s u o h T n i s e i c n e r r u C n g i e r o F ( s m r e T t n e m y a P e c i r P t i n U s m r e T t n e m y a P o t % l a t o T t n u o m A s e i c n e r r u C n g i e r o F ( ) s d n a s u o h T n i / s e s a h c r u P s e l a S s p i h s n o i t a l e R f o e r u t a N y t r a P d e t a l e R e m a N y n a p m o C e t a d e c i o v n i m o r f s y a d 0 3 t e N 4 6 7 3 5 , 1 5 3 , 0 5 6 $ s e l a S y r a i d i s b u S a c i r e m A h t r o N C M S T C M S T n o i t c a s n a r T l a m r o n b A s l i a t e D n o i t c a s n a r T L A T I P A C N I - D I A P E H T F O % 0 2 R O N O I L L I M 0 0 1 $ T N T S A E L T A F O S E I T R A P D E T A L E R O T S E L A S R O M O R F S E S A H C R U P L A T O T ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F s e e t s e v n I d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T 1 - 5 4 1 1 - - - - 0 3 7 , 7 7 7 ) 1 4 1 , 0 4 4 , 1 ( ) 4 9 0 , 8 2 3 , 1 ( ) 0 5 9 , 9 0 4 ( ) 9 5 9 , 6 0 4 ( - ) 6 6 2 , 8 2 6 1 , 5 4 2 2 3 2 , 1 6 1 $ S U ( - - - - - - - - - 7 7 0 1 5 , 9 2 3 , 1 9 $ e t o N - - - - - - - - - - d e u s s i s i e c i o v n i n e h w f o h t n o m d e u s s i s i e c i o v n i n e h w f o h t n o m e h t f o d n e e h t m o r f s y a d 0 3 t e N e h t f o d n e e h t m o r f s y a d 0 3 t e N e h t f o d n e e h t m o r f s y a d 0 3 t e N d e u s s i s i e c i o v n i n e h w f o h t n o m e h t f o d n e e h t m o r f s y a d 0 3 t e N d e u s s i s i e c i o v n i n e h w f o h t n o m e h t f o d n e e h t m o r f s y a d 0 3 t e N d e u s s i s i e c i o v n i n e h w f o h t n o m e h t f o d n e e h t m o r f s y a d 0 3 t e N d e u s s i s i e c i o v n i n e h w f o h t n o m ) 1 e t o N ( e t a d e c i o v n i m o r f s y a d 0 3 t e N 1 - 7 2 1 1 7 5 - d e u s s i s i e c i o v n i n e h w f o h t n o m e h t f o d n e e h t m o r f s y a d 0 3 t e N 6 1 0 1 2 , 1 0 4 d e u s s i s i e c i o v n i n e h w f o h t n o m e h t f o d n e e h t m o r f s y a d 0 3 t e N 1 ) 4 0 3 , 5 2 5 7 0 , 5 1 1 B M R ( 0 6 5 , 8 3 0 , 1 ) 9 4 1 , 4 3 $ S U ( s e l a S s e l a S s e l a S C M S T f o e t a i c o s s A C U G a c i r e m A h t r o N C M S T C M S T f o e t a i c o s s A c e t n i X h c e T a r E s i V C M S T f o e t a i c o s s A C M S S a n i h C C M S T - - 9 9 7 7 1 1 - - . a c i r e m A h t r o N C M S T y b s t n e i l c s t i o t d e t n a r g s m r e t t n e m y a p e h t y b d e n i m r e t e d r o e t a d e c i o v n i s ’ C M S T m o r f s y a d 0 3 s i r o n e t e h T : e t o N 5 6 1 , 4 6 8 , 6 2 7 6 , 6 1 4 s e l a S s e l a S 0 5 8 , 9 5 0 , 2 2 s e s a h c r u P e t a i c o s s A y r a i d i s b u S y r a i d i s b u S 1 4 7 , 3 8 7 , 8 s e s a h c r u P y r a i d i s b u s t c e r i d n I 7 2 7 , 5 5 7 , 5 s e s a h c r u P 0 9 1 , 8 4 1 , 4 s e s a h c r u P e t a i c o s s A e t a i c o s s A g n i j n a N C M S T a n i h C C M S T h c e T r e f a W C U G C M S S S I V 7 E L B A T - - - - - - - - - r o f e c n a w o l l A s t b e D d a B d e v i e c e R s t n u o m A t n e u q e s b u S n i d o i r e P - 0 1 0 , 1 7 5 $ 2 5 0 , 9 6 2 , 7 1 $ - - 1 7 6 ) 7 4 1 - ) 2 5 4 5 5 , 1 B M R ( $ S U ( ) 7 8 6 , 3 6 6 3 , 9 0 1 $ S U ( - - 0 0 8 8 1 1 - - e u d r e v O n e k a T n o i t c A t n u o m A s y a D r e v o n r u T ) 1 e t o N ( - - - - - - - - - - 9 3 7 , 1 2 5 8 6 0 , 0 4 3 , 7 $ - - 1 7 6 ) 7 4 1 - ) 2 5 4 5 5 , 1 B M R ( $ S U ( ) 4 2 6 , 3 3 8 4 , 7 0 1 $ S U ( 0 5 2 e t o N 5 4 6 2 2 e t o N 2 e t o N 4 5 3 4 0 5 e c n a l a B g n i d n E s e i c n e r r u C n g i e r o F ( s p i h s n o i t a l e R f o e r u t a N y t r a P d e t a l e R e m a N y n a p m o C ) s d n a s u o h T n i 0 3 7 , 7 7 7 4 8 4 , 4 5 7 , 1 1 1 6 , 5 7 5 , 2 9 $ 1 4 1 , 0 4 4 , 1 ) 8 3 2 , 6 1 3 B M R ( 5 2 0 , 7 6 1 , 0 2 ) 4 3 9 , 7 2 4 , 4 B M R ( ) 9 8 9 , 8 9 9 5 , 6 6 2 $ S U ( 4 9 0 , 8 2 3 , 1 ) 9 7 7 , 4 4 $ S U ( 2 3 2 , 1 6 1 ) 6 6 2 , 8 2 6 1 , 5 4 2 $ S U ( y n a p m o c t n e r a p e m a s e h T g n i j n a N C M S T y n a p m o c t n e r a P C M S T a n i h C C M S T y r a i d i s b u S y r a i d i s b u S e t a i c o s s A a c i r e m A h t r o N C M S T g n i j n a N C M S T C U G C M S T e h t f o t n e r a p e t a m i t l u e h T C M S T y g o l o n h c e T C M S T e h t f o t n e r a p e t a m i t l u e h T y n a p m o C y n a p m o C C M S T f o e t a i c o s s A C M S T f o e t a i c o s s A C M S T h c e T r e f a W c e t n i X C U G h c e T a r E s i V h t r o N C M S T a c i r e m A . s y a d r e v o n r u t f o n o i t a l u c l a c e h t r o f e l b a c i l p p a t o n s i h c i h w , s e l b a v i e c e r r e h t o f o d e t s i s n o c y l i r a m i r p s i e c n a l a b g n i d n e e h T : 2 . s e i t r a p d e t a l e r m o r f s e l b a v i e c e r r e h t o s e d u l c x e s y a d r e v o n r u t f o n o i t a l u c l a c e h T : 1 e t o N e t o N L A T I P A C N I - D I A P E H T F O % 0 2 R O N O I L L I M 0 0 1 $ T N T S A E L T A O T G N I T N U O M A S E I T R A P D E T A L E R M O R F S E L B A V I E C E R ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( 7 1 0 2 , 1 3 R E B M E C E D s e e t s e v n I d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T 8 E L B A T e t o N f o e r a h S s e s s o L / s t i f o r P e e t s e v n I f o ) 1 e t o N ( n g i e r o F ( n i s e i c n e r r u C ) s d n a s u o h T y r a i d i s b u S y r a i d i s b u S , 4 2 0 6 2 0 , 5 , 1 0 6 5 2 2 , 2 $ , 4 2 0 6 2 0 , 5 , 1 0 6 5 2 2 , 2 $ 7 8 2 , 4 8 6 9 4 , , 7 7 8 1 1 2 9 0 3 $ , e m o c n I t e N e h t f o ) s e s s o L ( e e t s e v n I n g i e r o F ( g n i y r r a C e u l a V n g i e r o F ( n i s e i c n e r r u C n i s e i c n e r r u C ) s d n a s u o h T ) s d n a s u o h T ) A N I H C D N A L N I A M N I T N E M T S E V N I N O N O I T A M R O F N I G N I D U L C X E ( E C N E U L F N I T N A C I F I N G I S S E S I C R E X E Y N A P M O C E H T H C I H W R E V O S E E T S E V N I F O N O I T A M R O F N I D E T A L E R D N A , S N O I T A C O L , S E M A N ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F s e e t s e v n I d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T 7 1 0 2 , 1 3 r e b m e c e D f o s a e c n a l a B t n u o m A t n e m t s e v n I l a n i g i r O f o e g a t n e c r e P p i h s r e n w O n I ( s e r a h S ) s d n a s u o h T , 1 3 r e b m e c e D , 1 3 r e b m e c e D 6 1 0 2 n g i e r o F ( 7 1 0 2 n g i e r o F ( n i s e i c n e r r u C n i s e i c n e r r u C ) s d n a s u o h T ) s d n a s u o h T 0 0 1 0 0 1 9 8 6 2 8 8 9 , 0 3 1 , 6 5 4 , 1 3 0 3 1 , 6 5 4 , 1 3 9 1 2 , 7 0 2 , 2 3 2 $ 9 2 2 , 0 9 8 , 2 9 2 $ s t c u d o r P d n a s e s s e n i s u B n i a M n o i t a c o L y n a p m o C e e t s e v n I y n a p m o C r o t s e v n I e h t n i s s e n i s u b d e t a l e r r e h t o d n a , e r u t c a f u n a m t n e m t s e v n i r e h t o d n a y r t s u d n i r o t c u d n o c i m e s , n g i s e d e h t n i d e v l o v n i s e i n a p m o c n i g n i t s e v n I s e i t i v i t c a t n e m t s e v n I s e i t i v i t c a s d n a l s I n i g r i V h s i t i r B , a l o t r o T s d n a l s I n i g r i V h s i t i r B , a l o t r o T s r e n t r a P C M S T l a b o l G C M S T C M S T e t a i c o s s A , 3 7 0 4 2 7 , 1 , 4 3 6 4 4 4 , 4 , 0 4 6 7 7 6 , 5 y r a i d i s b u S 4 2 4 0 8 1 , 7 5 5 7 0 2 , , 2 6 1 7 6 6 , 4 9 3 7 8 4 1 3 8 2 0 , 0 2 1 , 5 8 2 0 , 0 2 1 , 5 s t i u c r i c d e t a r g e t n i f o g n i l l e s d n a g n i r u t c a f u n a M e r o p a g n i S 0 2 1 3 5 2 , 1 7 1 , 5 0 0 , 5 1 7 1 , 5 0 0 , 5 s t r a p e r a p s c i n o r t c e l e g n i r u t c a f u n a m n i d e g a g n E n a w i a T , u h C - n i s H s e c i v e d r o t c u d n o c i m e s r e h t o d n a h c e T a r E s i V C M S S s t i u c r i c d e t a r g e t n i f o n g i s e d d e d i a - r e t u p m o c s k s a m f o e c i v r e s n g i s e d d n a g n i r u t c a f u n a m e h t d n a s e c i v e d r o t c u d n o c i m e s r e h t o d n a e t a i c o s s A , 1 4 9 0 7 2 , 1 , 4 6 0 5 0 5 , 4 , 4 4 3 8 6 5 , 8 8 2 3 2 2 4 6 4 , 7 7 6 , 0 8 1 , 0 1 7 7 6 , 0 8 1 , 0 1 d n a g n i t s e t , g n i g a k c a p , g n i l l e s , g n i r u t c a f u n a M n a w i a T , u h C - n i s H S I V y r a i d i s b u S 9 5 8 , 5 9 5 8 , 5 , 3 0 0 1 0 0 , 4 0 0 1 0 0 0 1 1 , 8 1 7 , 3 3 3 8 1 7 , 3 3 3 d n a s t i u c r i c d e t a r g e t n i f o g n i t e k r a m d n a g n i l l e S g n i t s e t d n a g n i g a k c a p , g n i l l e s , g n i r u t c a f u n a m , g n i n g i s e d , g n i p o l e v e d , g n i h c r a e s e r n i d n a r e t l i f r o l o c f o . A S U . , a i n r o f i l a C , e s o J n a S a c i r e m A h t r o N C M S T 2 8 2 1 1 1 , 7 1 3 , 8 8 9 , 1 7 1 3 , 8 8 9 , 1 l e v e l r e f a w d n a g n i g a k c a p e z i s p i h c l e v e l r e f a W n a w i a T , n a u y o a T e c i v r e s n o i t c e n n o c r e t n i n o i t a v i s s a p t s o p 8 8 6 6 4 , 8 6 5 , 6 8 3 8 6 5 , 6 8 3 g n i t s e t , g n i r u t c a f u n a m , g n i p o l e v e d , g n i h c r a e s e R n a w i a T , u h C - n i s H s e c i v e d r o t c u d n o c i m e s r e h t o s t i u c r i c d e t a r g e t n i f o g n i t e k r a m d n a s e i t i v i t c a g n i t r o p p u s d n a e c i v r e s r e m o t s u C s d n a l r e h t e N e h t , m a d r e t s m A ) d e u n i t n o C ( e t a i c o s s A ) 3 9 4 , 4 0 3 ( ) 0 8 2 , 3 3 7 ( , 0 0 1 2 9 2 , 2 e t a i c o s s A 6 1 8 7 9 2 , 9 0 8 4 5 8 , , 4 9 1 0 0 3 , 1 y r a i d i s b u S y r a i d i s b u S 7 5 5 0 4 , 5 2 9 0 3 1 , y r a i d i s b u S ) 9 2 7 4 2 ( , y r a i d i s b u S y r a i d i s b u S 0 0 6 , 3 0 7 9 , 1 y r a i d i s b u S ) 6 0 7 2 1 ( , 7 5 5 0 4 , 7 9 5 3 3 1 , ) 4 3 2 5 2 ( , 0 0 6 , 3 0 7 9 , 1 ) 6 0 7 2 1 ( , 4 2 3 7 0 4 , 3 3 5 0 2 3 , 6 3 8 2 5 1 , 6 4 4 9 2 1 , 0 1 2 9 3 , ) 7 1 2 0 2 ( , y r a i d i s b u S 2 e t o N , 0 0 9 8 4 4 , 1 5 6 4 , 9 7 3 6 2 , ) 9 7 4 7 4 , $ S U ( ) 5 2 4 9 8 8 , $ S U ( y r a i d i s b u S 2 e t o N y r a i d i s b u S 2 e t o N y r a i d i s b u S 2 e t o N y r a i d i s b u S 2 e t o N y r a i d i s b u S 2 e t o N e t a i c o s s A 2 e t o N ) 2 1 5 0 9 9 8 1 , ) 7 1 6 7 9 5 5 1 , 9 9 2 8 7 3 , 9 3 8 6 1 6 8 1 5 , $ S U ( ) 6 8 4 7 1 , $ S U ( 1 2 3 2 8 1 , $ S U ( ) 7 4 1 , 6 $ S U ( ) 1 9 4 2 1 , $ S U ( ) 8 2 $ S U ( ) 1 4 4 2 9 4 $ S U ( ) 7 1 $ S U ( ) ) 6 4 ( ) 5 8 3 , 1 ( ) ) 9 8 5 ( ) 8 2 0 8 1 ( , 4 3 3 6 4 , $ S U ( ) 2 6 5 , 1 $ S U ( 0 1 2 3 2 , $ S U ( ) 3 8 7 $ S U ( 1 4 5 3 0 0 1 8 9 8 9 0 0 1 0 0 1 0 0 1 0 0 1 0 0 1 0 0 1 7 9 7 9 0 0 1 9 3 - - - 6 1 0 8 - - 0 0 3 , 2 9 9 2 , 9 3 8 5 - 3 9 6 , 4 0 9 5 , 3 2 4 ) 2 8 2 , 4 1 6 1 2 , 8 6 ) 0 0 3 , 2 4 4 0 , 4 5 1 ) 5 7 4 ) 4 9 1 , 5 4 9 0 , 4 1 ) 2 6 4 , 1 5 5 3 , 3 4 2 0 6 , 4 5 1 0 6 7 , 3 8 6 5 6 , 3 1 6 6 2 , 5 2 9 4 7 , 5 1 2 6 5 , 8 0 6 7 1 4 , 5 5 3 , 1 0 6 7 , 3 8 6 5 6 , 3 1 6 6 2 , 5 2 9 4 7 , 5 1 1 3 8 , 2 1 4 5 8 8 , 8 1 3 , 1 s e i n a p m o c y g o l o n h c e t p u - t r a t s w e n n i g n i t s e v n I s e i n a p m o c y g o l o n h c e t p u - t r a t s w e n n i g n i t s e v n I g n i d i v o r p d n a s t c u d o r p d e t a l e r r a l o s f o g n i l l e S s e i t i v i t c a g n i t r o p p u s s e i t i v i t c a g n i t r o p p u s d n a d n a e c i v r e s r e m o t s u C e c i v r e s r e m o t s u C e c i v r e s r e m o t s u c 8 1 0 , 8 0 4 , 7 1 8 1 0 , 8 0 4 , 7 1 ) 9 3 9 , 6 8 5 $ S U ( ) 9 3 9 , 6 8 5 $ S U ( e h t n i s s e n i s u b d e t a l e r g n i r u t c a f u n a m e h t n i d e v l o v n i s e i n a p m o c n i g n i t s e v n I $ S U ( - 0 9 5 , 3 2 4 $ S U ( ) 2 8 2 , 4 1 $ S U ( 6 1 2 , 8 6 $ S U ( ) 0 0 3 , 2 $ S U ( s e i n a p m o c y g o l o n h c e t p u - t r a t s w e n n i g n i t s e v n I s e i t i v i t c a t r o p p u s g n i r e e n i g n E y r t s u d n i r o t c u d n o c i m e s s e i t i v i t c a t r o p p u s g n i r e e n i g n E $ S U ( ) 5 7 4 $ S U ( 4 9 0 , 4 1 s e i n a p m o c y g o l o n h c e t p u - t r a t s w e n n i g n i t s e v n I ) 3 1 2 , 5 $ S U ( ) 3 9 5 , 1 $ S U ( d n a , s l a i r e t a m c i n o r t c e l e f o g n i l i a t e r d n a D I F R f o g n i t s e t d n a g n i p o l e v e d , g n i h c r a e s e r - - 1 1 8 8 1 1 - - s d n a l s I n a m y a C s d n a l s I n a m y a C n a p a J , a m a h o k o Y a e r o K , l u o e S a d a n a C , o i r a t n O s d n a l s I n a m y a C s d n a l s I n a m y a C a d a n a C C M S T I I F D S I F D S I y n a m r e G , g r u b m a H H b m G e p o r u E r a l o S C M S T . A S U . . A S U . , e r a w a l e D y g o l o n h c e T C M S T , e r a w a l e D t n e m p o l e v e D C M S T s r e n t r a P C M S T e p o r u E C M S T n a p a J C M S T a e r o K C M S T I I F A T V I I I F A T V c e t n i X C U G $ S U ( ) 4 5 1 , 2 $ S U ( 7 5 2 , 7 4 g n i l a s e l o h w , s t r a p c i n o r t c e l e f o g n i r u t c a f u n a M n a w i a T , i e p i a T w e N k a P - l a u t u M 9 7 8 , 3 6 s e i n a p m o c y g o l o n h c e t p u - t r a t s w e n n i g n i t s e v n I s d n a l s I n a m y a C d n u F h t w o r G I I I F A T V e t o N f o e r a h S s e s s o L / s t i f o r P e e t s e v n I f o ) 1 e t o N ( n g i e r o F ( n i s e i c n e r r u C ) s d n a s u o h T e m o c n I t e N e h t f o ) s e s s o L ( e e t s e v n I n g i e r o F ( g n i y r r a C e u l a V n g i e r o F ( n i s e i c n e r r u C n i s e i c n e r r u C ) s d n a s u o h T ) s d n a s u o h T 7 1 0 2 , 1 3 r e b m e c e D f o s a e c n a l a B t n u o m A t n e m t s e v n I l a n i g i r O f o e g a t n e c r e P p i h s r e n w O n I ( s e r a h S ) s d n a s u o h T , 1 3 r e b m e c e D , 1 3 r e b m e c e D 6 1 0 2 n g i e r o F ( 7 1 0 2 n g i e r o F ( n i s e i c n e r r u C n i s e i c n e r r u C ) s d n a s u o h T ) s d n a s u o h T s t c u d o r P d n a s e s s e n i s u B n i a M n o i t a c o L y n a p m o C e e t s e v n I y n a p m o C r o t s e v n I ) d e d u l c n o C ( . y n a p m o c r o t s e v n i e h t f o s e s s o l / s t i f o r p f o e r a h s e h t n i d e d u l c n i y d a e r l a s i t n u o m a h c u s s a n i e r e h d e t c e l f e r t o n s i y n a p m o c e e t s e v n i e h t f o s e s s o l / s t i f o r p f o e r a h s e h T : 2 e t o N . s n o i t c a s n a r t y n a p m o c r e t n i n o t i f o r p s s o r g d e z i l a e r n u f o t c e f f e e h t s e d u l c n i e e t s e v n i f o s e s s o l / s t i f o r p f o e r a h s e h T : 1 e t o N - - 2 2 8 8 1 1 - - y r a i d i s b u S 2 e t o N , 8 5 6 8 4 2 , 1 $ , 2 4 3 2 6 7 , 4 $ ) 6 9 8 0 4 , $ S U ( ) 0 7 5 0 6 1 , $ S U ( 0 0 1 7 3 6 3 9 2 , - $ - $ d e t a r g e t n i f o g n i t s e t d n a g n i l l e s , g n i r u t c a f u n a M s e c i v e d r o t c u d n o c i m e s r e h t o d n a s t i u c r i c . A S U . , n o t g n i h s a W h c e T r e f a W t n e m p o l e v e D C M S T 9 E L B A T d e t a l u m u c c A d r a w n I f o e c n a t t i m e R f o s a s g n i n r a E , 1 3 r e b m e c e D 7 1 0 2 g n i y r r a C t n u o m A f o s a , 1 3 r e b m e c e D 7 1 0 2 s e s s o L / s t i f o r P p i h s r e n w O e e t s e v n I y n a p m o C f o e r a h S f o e g a t n e c r e P e h t f o ) s e s s o L ( e m o c n I t e N d e t a l u m u c c A f o w o l f t u O m o r f t n e m t s e v n I f o s a n a w i a T , 1 3 r e b m e c e D n i $ S U ( 7 1 0 2 ) s d n a s u o h T s w o l F t n e m t s e v n I w o l f n I w o l f t u O n i $ S U ( ) s d n a s u o h T d e t a l u m u c c A f o w o l f t u O m o r f t n e m t s e v n I f o s a n a w i a T 7 1 0 2 , 1 y r a u n a J n i $ S U ( ) s d n a s u o h T f o d o h t e M t n e m t s e v n I f o t n u o m A l a t o T l a t i p a C n i - d i a P n i B M R ( ) s d n a s u o h T d n a s e s s e n i s u B n i a M s t c u d o r P y n a p m o C e e t s e v n I - - $ 5 8 8 , 0 6 0 , 1 5 $ 7 3 9 , 8 5 0 , 9 $ % 0 0 1 3 3 9 , 8 3 9 , 8 $ 7 6 6 , 9 3 9 , 8 1 $ - $ - $ 7 6 6 , 9 3 9 , 8 1 $ 1 e t o N ) 2 e t o N ( ) 0 0 0 , 6 9 5 $ S U ( ) 0 0 0 , 6 9 5 $ S U ( 7 6 6 , 9 3 9 , 8 1 $ ) 0 8 0 , 2 0 5 , 4 B M R ( n g i s e d d e d i a - r e t u p m o c s t i u c r i c d e t a r g e t n i f o d n a g n i t s e t r e h t o d n a s e c i v e d r o t c u d n o c i m e s , g n i l l e s , g n i r u t c a f u n a M a n i h C C M S T 0 4 7 , 3 9 4 , 6 2 ) 2 e t o N ( ) 3 6 5 , 7 6 8 ( % 0 0 1 ) 3 6 5 , 7 6 8 ( ) 0 0 0 , 0 2 9 $ S U ( 2 9 0 , 0 6 1 , 8 2 - ) 0 0 0 , 0 2 7 $ S U ( ) 0 0 0 , 0 0 2 $ S U ( ) 6 7 2 , 3 3 1 , 6 B M R ( d n a g n i t s e t 2 9 8 , 4 2 7 , 1 2 0 0 2 , 5 3 4 , 6 1 e t o N 2 9 0 , 0 6 1 , 8 2 , g n i l l e s , g n i r u t c a f u n a M g n i j n a N C M S T ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n i s t n u o m A ( A N I H C D N A L N I A M N I T N E M T S E V N I N O N O I T A M R O F N I 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y R O F t n e m t s e v n I n o t i i m L r e p p U A E O M , n o i s s i m m o C t n e m t s e v n I 3 e t o N ) s d n a s u o h T n i $ S U ( 7 6 6 , 2 1 4 , 9 1 1 $ ) 0 0 0 , 6 9 5 , 3 $ S U ( 7 1 0 2 , 1 3 r e b m e c e D f o s a ) s d n a s u o h T n i $ S U ( 9 5 7 , 9 9 0 7 4 , $ ) 0 0 0 6 1 5 , , 1 $ S U ( y b d e z i r o h t u A s t n u o m A t n e m t s e v n I a n i h C d n a l n i a M n i t n e m t s e v n I d e t a l u m u c c A n g i s e d d e d i a - r e t u p m o c s t i u c r i c d e t a r g e t n i f o r e h t o d n a s e c i v e d r o t c u d n o c i m e s f o e l p i c n i r P “ o t t n a u s r u p a n i h C d n a l n i a m n i t n e m t s e v n i n o t i m i l r e p p u e h t , 6 1 0 2 t s u g u A n o A E O M , u a e r u B t n e m p o l e v e D l a i r t s u d n I y b d e u s s i s r e t r a u q d a e h g n i t a r e p o r o f d e i f i l a u q g n i e b f o e t a c i f i t r e c e h t d e n i a t b o s a h y n a p m o C e h t s A : 3 . e l b a c i l p p a t o n s i ” a n i h C d n a l n i a M n i n o i t a r e p o o C l a c i n h c e T r o t n e m t s e v n i . g n i j n a N C M S T n i s d n a s u o h t 0 0 0 , 0 2 9 $ S U d n a a n i h C C M S T n i d n a s u o h t 0 0 0 , 6 9 5 $ S U d e t s e v n i y l t c e r i d C M S T : 1 . s t n e m e t a t s l a i c n a n i f d e t i d u a e h t n o d e s a b d e z i n g o c e r s a w t n u o m A : 2 e t o N e t o N e t o N - - 3 3 8 8 1 1 - - s e e t s e v n I d n a d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T THE CONTENTS OF STATEMENTS OF MAJOR ACCOUNTING ITEMS ITEM STATEMENT INDEX MAJOR ACCOUNTING ITEMS IN ASSETS, LIABILITIES AND EQUITY STATEMENT OF CASH AND CASH EQUIVALENTS STATEMENT OF NOTES AND ACCOUNTS RECEIVABLE, NET STATEMENT OF RECEIVABLES FROM RELATED PARTIES STATEMENT OF INVENTORIES STATEMENT OF OTHER CURRENT ASSETS STATEMENT OF CHANGES IN INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD STATEMENT OF CHANGES IN PROPERTY, PLANT AND EQUIPMENT STATEMENT OF CHANGES IN ACCUMULATED DEPRECIATION AND ACCUMULATED IMPAIRMENT OF PROPERTY, PLANT AND EQUIPMENT STATEMENT OF CHANGES IN INTANGIBLE ASSETS STATEMENT OF GUARANTEE DEPOSITS STATEMENT OF DEFERRED INCOME TAX ASSETS / LIABILITIES STATEMENT OF SHORT-TERM LOANS STATEMENT OF ACCOUNTS PAYABLES STATEMENT OF PAYABLES TO RELATED PARTIES STATEMENT OF PAYABLES TO CONTRACTORS AND EQUIPMENT SUPPLIERS STATEMENT OF PROVISIONS STATEMENT OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES STATEMENT OF BONDS PAYABLE MAJOR ACCOUNTING ITEMS IN PROFIT OR LOSS STATEMENT OF NET REVENUE STATEMENT OF COST OF REVENUE STATEMENT OF OPERATING EXPENSES STATEMENT OF FINANCE COSTS STATEMENT OF LABOR, DEPRECIATION AND AMORTIZATION BY FUNCTION 1 2 3 4 Note 15 5 Note 13 Note 13 Note 14 Note 20 Note 27 6 7 8 9 Note 17 10 11 12 13 14 Note 25 15 - 184 - - 184 - STATEMENT 1 Taiwan Semiconductor Manufacturing Company Limited STATEMENT OF CASH AND CASH EQUIVALENTS DECEMBER 31, 2017 (In Thousands of New Taiwan Dollars, Unless Specified Otherwise) Item Description Amount Cash Petty cash Cash in banks Checking accounts and demand deposits Foreign currency deposits Time deposits $ 330 25,958,240 35,231,163 177,987,108 Including US$778,555 thousand @29.659, JPY33,992,762 thousand @0.2629 and EUR90,361 thousand @35.45 From 2017.05.31 to 2018.09.28, interest rates at 0.001%-2.16%, including NT$155,849,074 thousand, US$574,900 thousand @29.659 and EUR143,500 @35.45 Total $ 239,176,841 - 185 - - 185 - Taiwan Semiconductor Manufacturing Company Limited STATEMENT OF NOTES AND ACCOUNTS RECEIVABLE, NET DECEMBER 31, 2017 (In Thousands of New Taiwan Dollars) Client Name Client A Client B Client C Client D Client E Client F Others (Note 1) Less: Allowance for doubtful accounts Total STATEMENT 2 Amount $ 4,331,550 4,182,954 2,348,708 2,006,820 1,390,409 1,357,239 11,506,872 27,124,552 (469,125) $ 26,655,427 Note 1: The amount of individual client included in others does not exceed 5% of the account balance. Note 2: The accounts receivable past due over one year amounted to NT$5,902 thousand. The Company’s subsidiary has obtained guarantee against these receivables, thus there was no impairment concern for the notes and accounts receivable. - 186 - - 186 - Taiwan Semiconductor Manufacturing Company Limited STATEMENT OF RECEIVABLES FROM RELATED PARTIES DECEMBER 31, 2017 (In Thousands of New Taiwan Dollars) Client Name TSMC North America Others (Note) Total STATEMENT 3 Amount $ 91,329,510 812,327 $ 92,141,837 Note: The amount of individual client included in others does not exceed 5% of the account balance. - 187 - - 187 - Taiwan Semiconductor Manufacturing Company Limited STATEMENT OF INVENTORIES DECEMBER 31, 2017 (In Thousands of New Taiwan Dollars) STATEMENT 4 Item Finished goods Work in process Raw materials Supplies and spare parts Total Amount Cost Net Realizable Value $ 9,596,837 $ 26,645,348 52,166,234 213,045,079 6,566,716 6,611,434 1,967,658 1,999,552 $ 70,297,445 $ 248,301,413 - 188 - - 188 - 5 T N E M E T A T S r o e u l a V t e k r a M e u l a V s t e s s A t e N e s a e r c n I ) e s a e r c e D ( e h t g n i s U n i 7 1 0 2 , 1 3 r e b m e c e D , e c n a l a B d o h t e M y t i u q E t n e m t s e v n I n i e s a e r c e D t n e m t s e v n I n i s n o i t i d d A 7 1 0 2 , 1 y r a u n a J , e c n a l a B D O H T E M Y T I U Q E G N I S U R O F D E T N U O C C A S T N E M T S E V N I N I S E G N A H C F O T N E M E T A T S ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n I ( 7 1 0 2 , 1 3 R E B M E C E D D E D N E R A E Y E H T R O F d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T l a r e t a l l o C t n u o m A l a t o T e c i r P t i n U ) $ T N ( t n u o m A % ) s d n a s u o h T n I ( s e r a h S l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N , 7 7 8 1 1 2 9 0 3 $ , , 7 7 8 1 1 2 9 0 3 $ , 3 5 9 , 3 1 8 9 4 , 1 5 7 , 8 3 6 0 3 , , 7 5 6 3 6 4 , 5 , 8 2 5 3 1 6 , 4 , 3 0 0 1 0 0 , 4 , 9 5 7 0 8 1 , 9 4 0 4 , 5 0 9 1 1 , 4 2 3 7 0 4 , 6 4 4 9 2 1 , 0 1 2 9 3 , ) 7 1 2 0 2 ( , ) 1 e t o N ( 6 6 $ ) 1 e t o N ( 5 2 8 . ) 2 e t o N ( 5 5 2 , 4 4 3 8 6 5 , 8 , 0 4 6 7 7 6 , 5 , 2 6 1 7 6 6 , 4 , 3 0 0 1 0 0 , 4 , 0 0 1 2 9 2 , 2 , 4 9 1 0 0 3 , 1 7 8 2 , 4 8 6 9 4 , 4 2 3 7 0 4 , 6 4 4 9 2 1 , 0 1 2 9 3 , ) 7 1 2 0 2 ( , , 5 9 6 4 8 3 5 2 4 , , 0 7 3 8 5 9 5 8 3 , 7 8 2 4 1 3 , 7 6 6 9 2 1 , 5 1 8 , 1 6 1 1 5 , 3 7 3 , 8 6 0 7 2 , 2 4 1 , 4 7 6 8 7 , 3 3 5 0 2 3 , 6 3 8 2 5 1 , 5 8 8 , 0 6 0 1 5 , 0 4 7 , 3 9 4 6 2 , 4 9 9 , 7 2 0 8 7 , , 7 3 8 8 5 0 4 0 5 $ , , 4 6 3 6 8 9 3 6 4 $ , 0 0 1 0 0 1 8 2 9 3 7 8 0 0 1 1 4 5 3 0 0 1 0 0 1 0 0 1 0 0 1 0 0 1 0 0 1 8 9 8 9 9 4 1 3 8 6 2 8 8 9 , 3 2 2 4 6 4 , 0 0 0 1 1 , 0 2 1 3 5 2 , 8 8 6 6 4 , 2 8 2 1 1 1 , - 6 1 0 8 - - - - t n u o m A ) 3 e t o N ( ) 3 2 6 , 5 6 0 , 2 ( ) 0 4 0 , 8 3 2 ( ) 6 7 8 , 5 8 4 , 1 ( ) 2 6 8 , 5 0 1 , 7 1 ( $ ) 1 2 7 , 7 6 5 ( ) 0 0 3 , 9 3 3 ( ) 7 0 7 , 7 0 3 ( 3 1 0 , 6 2 1 ) 3 5 5 , 3 ( 9 2 6 , 3 5 4 0 5 , 3 ) 9 8 8 , 3 1 ( ) 5 2 4 , 4 4 9 , 1 2 ( 7 7 5 , 2 4 4 , 8 ) 6 4 2 , 2 6 5 , 1 ( 3 9 0 , 9 4 ) 2 8 9 , 9 2 ( 2 4 4 , 9 9 8 , 6 s e r a h S s e r a h S s e r a h S t n u o m A ) s d n a s u o h T n I ( t n u o m A ) s d n a s u o h T n I ( t n u o m A ) s d n a s u o h T n I ( s e e t s e v n I - - - - - - - - - - - - - - - ) 7 1 9 , 1 6 ( ) 1 3 7 , 5 9 1 ( ) 8 4 6 , 7 5 2 ( $ - - - - - - - - - - - - - - - - 0 1 0 , 3 8 6 , 0 6 $ 2 9 2 7 , 4 3 6 , 5 6 2 $ 7 - - - - - - - - - - - 0 1 0 , 3 8 6 , 0 6 - - 2 9 8 , 4 2 7 , 1 2 5 8 3 , 5 2 7 7 2 , 0 5 7 , 1 2 - - - - - - - - - - - - - - - 4 8 3 , 6 0 8 , 8 6 1 5 , 3 6 1 , 7 3 8 8 , 4 3 2 , 5 3 0 3 , 0 4 3 , 4 7 0 8 , 9 9 5 , 2 1 8 1 , 4 7 1 , 1 5 9 6 , 3 5 3 9 9 9 , 2 3 1 0 1 9 , 9 4 7 , 1 5 ) 8 2 3 , 6 ( 6 0 7 , 5 3 5 8 7 , 9 1 2 , 7 4 3 1 7 1 , 7 6 4 0 5 3 , 9 1 2 4 9 0 , 1 3 3 , 6 8 0 3 , 8 1 6 , 2 4 3 2 9 , 5 3 6 , 9 4 4 1 3 8 6 2 , 8 8 9 3 2 2 , 4 6 4 0 0 0 , 1 1 0 2 1 , 3 5 2 8 8 6 , 6 4 2 8 2 , 1 1 1 - 6 1 0 8 - - - - a c i r e m A h t r o N C M S T h c e T a r E s i V s r e n t r a P C M S T l a b o l G C M S T s k c o t S C M S S S I V e p o r u E C M S T n a p a J C M S T a e r o K C M S T c e t n i X C U G H b m G e p o r u E r a l o S C M S T l a t o t b u S g n i j n a N C M S T a n i h C C M S T l a t o t b u S I I F A T V I I I F A T V l a t i p a C ) 3 8 9 , 4 4 0 , 5 1 ( $ ) 8 4 6 , 7 5 2 ( $ 7 8 2 , 3 3 4 , 2 8 $ 8 0 7 , 5 5 8 , 6 9 3 $ . 7 1 0 2 , 9 2 r e b m e c e D f o s a t e k r a M s e i t i r u c e S i a T e r G f o e c i r p g n i s o l c y b d e t a l u c l a c s i e c i r p t i n u e h T . 7 1 0 2 , 9 2 r e b m e c e D f o s a e g n a h c x E k c o t S n a w i a T e h t f o e c i r p g n i s o l c y b d e t a l u c l a c s i e c i r p t i n u e h T l a t o T : 1 : 2 e t o N e t o N : 3 e t o N m o r f g n i s i r a s t n e m t s u j d a , s e t a i c o s s a d n a s e i r a i d i s b u s f o y t i u q e n i s e g n a h c f o e r a h s o t s t n e m t s u j d a , s e t a i c o s s a d n a s e i r a i d i s b u s m o r f d e v i e c e r s d n e d i v i d h s a c , s e t a i c o s s a d n a s e i r a i d i s b u s f o e m o c n i e v i s n e h e r p m o c r e h t o f o e r a h s , s e t a i c o s s a d n a s e i r a i d i s b u s f o s s o l r o t i f o r p f o e r a h s g n i d u l c n I . s e t a i c o s s a d n a s e i r a i d i s b u s h t i w s n o i t c a s n a r t e h t m o r f g n i t l u s e r s t n e m t s u j d a d n a s e i r a i d i s b u s n i p i h s r e n w o f o e g a t n e c r e p n i s e g n a h c - - 9 9 8 8 1 1 - - 6 T N E M E T A T S k r a m e R l a r e t a l l o C s t n e m t i m m o C n a o L ) % ( s e t a R t s e r e t n I d o i r e P t c a r t n o C f o e g n a R - - - - - - - - - - - - - l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N 0 0 0 , 0 0 5 0 0 0 , 0 0 3 0 0 0 , 0 0 3 0 0 0 , 0 0 3 $ S U $ S U $ S U $ S U 0 0 0 , 0 0 0 , 7 $ T N 0 0 0 , 4 8 4 0 0 0 , 0 5 2 0 0 0 , 0 0 2 0 0 0 , 0 1 1 0 0 0 , 0 0 1 0 0 0 , 0 7 0 0 0 , 5 5 0 0 0 , 0 0 3 $ S U $ S U $ S U $ S U $ S U $ S U $ S U $ S U 6 5 . 1 5 5 5 . 1 5 7 . 1 2 8 . 1 7 5 . 1 0 6 . 1 - 6 5 . 1 5 6 . 1 6 6 . 1 6 7 . 1 2 6 . 1 4 5 . 1 4 5 . 1 0 8 . 1 8 0 . 1 0 . 8 1 0 2 - 3 1 . 1 1 . 7 1 0 2 3 0 . 1 0 . 8 1 0 2 - 3 0 . 1 1 . 7 1 0 2 8 0 . 1 0 . 8 1 0 2 - 8 1 . 2 1 . 7 1 0 2 2 2 . 1 0 . 8 1 0 2 - 0 2 . 2 1 . 7 1 0 2 9 0 . 1 0 . 8 1 0 2 - 2 0 . 1 1 . 7 1 0 2 6 1 . 1 0 . 8 1 0 2 - 1 0 . 1 1 . 7 1 0 2 3 1 . 2 0 . 8 1 0 2 - 7 1 . 1 1 . 7 1 0 2 5 0 . 1 0 . 8 1 0 2 - 6 0 . 1 1 . 7 1 0 2 1 1 . 1 0 . 8 1 0 2 - 5 1 . 2 1 . 7 1 0 2 5 0 . 1 0 . 8 1 0 2 - 3 0 . 1 1 . 7 1 0 2 6 1 . 1 0 . 8 1 0 2 - 7 1 . 1 1 . 7 1 0 2 6 1 . 1 0 . 8 1 0 2 - 7 1 . 1 1 . 7 1 0 2 9 1 . 1 0 . 8 1 0 2 - 9 1 . 2 1 . 7 1 0 2 ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n I ( S N A O L M R E T - T R O H S F O T N E M E T A T S 7 1 0 2 , 1 3 R E B M E C E D , e c n a l a B r a e Y f o d n E 5 4 8 , 4 9 4 , 3 1 $ 0 2 5 , 4 0 3 , 8 0 3 9 , 7 0 0 , 8 0 3 9 , 7 0 0 , 8 0 5 8 , 8 4 4 , 4 5 6 9 , 3 0 0 , 4 5 6 9 , 3 0 0 , 4 5 6 9 , 3 0 0 , 4 0 0 9 , 5 6 9 , 2 0 1 3 , 9 6 6 , 2 0 4 5 , 9 7 7 , 1 0 6 3 , 6 8 1 , 1 0 7 7 , 9 8 8 0 5 8 , 6 6 7 , 3 6 $ e p y T . d t L , J F U i h s i b u s t i M - o y k o T f O k n a B e h T a n i h C f O k n a B s n a o l d e r u c e s n U n o i t a r o p r o C g n i k n a B i u s t i M o m o t i m u S . . A N k n a B e s a h C n a g r o M P J I B C e l o c i r g A t i d é r C a c i r e m A f O k n a B i e p i a T k n a b i t i C k n a b a g e M S B D n a w i a T k n a b i t i C n a w i a T C B S H C B S H B D - - 0 0 9 9 1 1 - - d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T Taiwan Semiconductor Manufacturing Company Limited STATEMENT OF ACCOUNTS PAYABLES DECEMBER 31, 2017 (In Thousands of New Taiwan Dollars) Vendor Name Vendor A Others (Note) Total STATEMENT 7 Amount $ 1,423,525 24,181,698 $ 25,605,223 Note: The amount of individual vendor in others does not exceed 5% of the account balance. - 191 - - 191 - Taiwan Semiconductor Manufacturing Company Limited STATEMENT OF PAYABLES TO RELATED PARTIES DECEMBER 31, 2017 (In Thousands of New Taiwan Dollars) Vendor Name TSMC China WaferTech Xintec VIS SSMC TSMC Technology Others (Note) Total STATEMENT 8 Amount $ 1,440,141 1,328,094 817,876 409,950 406,959 266,599 160,045 $ 4,829,664 Note: The amount of individual vendor in others does not exceed 5% of the account balance. - 192 - - 192 - Taiwan Semiconductor Manufacturing Company Limited STATEMENT OF PAYABLES TO CONTRACTORS AND EQUIPMENT SUPPLIERS DECEMBER 31, 2017 (In Thousands of New Taiwan Dollars) STATEMENT 9 Vendor Name Vendor B Vendor C Vendor D Vendor E Others (Note) Total Amount $ 13,232,731 10,942,580 3,378,171 2,893,271 19,917,223 $ 50,363,976 Note: The amount of individual vendor included in others does not exceed 5% of the account balance. - 193 - - 193 - Taiwan Semiconductor Manufacturing Company Limited STATEMENT OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES DECEMBER 31, 2017 (In Thousands of New Taiwan Dollars) Item Receipts in advance Guarantee deposit Others (Note) Total Note: The amount of each item in others does not exceed 5% of the account balance. STATEMENT 10 Amount $ 31,078,331 6,046,643 20,561,412 $ 57,686,386 - 194 - - 194 - 1 1 T N E M E T A T S l a r e t a l l o C t n e m y a p e R e u l a V g n i y r r a C d e z i t r o m a n U s m u i m e r P ) s t n u o c s i D ( t n u o m A , e c n a l a B r a e Y f o d n E t n e m y a p e R d i a p t n u o m A l a t o T n o p u o C ) % ( e t a R t s e r e t n I e t a D t n e m y a P e t a D e c n a u s s I e e t s u r T e m a N s d n o B E L B A Y A P S D N O B F O T N E M E T A T S 7 1 0 2 , 1 3 R E B M E C E D ) s r a l l o D n a w i a T w e N f o s d n a s u o h T n I ( d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N l i N t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B - , 0 0 0 0 0 0 , 7 t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B - , 0 0 0 0 0 0 , 9 t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B - , 0 0 0 0 0 0 , 9 , 0 0 0 0 0 4 , 4 t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B 0 0 0 , 0 0 6 0 1 , 0 0 0 , 0 0 0 0 1 , , 0 0 0 0 0 0 , 3 , 0 0 0 0 0 2 , 6 , 0 0 0 0 0 6 , 3 0 0 0 , 0 0 6 1 1 , t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B , 0 0 0 0 0 5 , 3 0 0 0 , 0 0 2 0 1 , t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B - , 0 0 0 0 0 5 , 8 t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B t n e m y a p e r t e l l u B - , 0 0 0 0 0 4 , 1 , 0 0 0 0 0 6 , 2 , 0 0 0 0 0 4 , 5 , 0 0 0 0 0 6 , 2 t n e m y a p e r t e l l u B , 0 0 0 0 0 5 , 7 $ , 0 0 0 0 0 1 6 1 1 , $ - - - - - - - - - - - - - - - - - - - - - - - - $ , 0 0 0 0 0 5 , 7 $ - $ 0 0 0 , 0 0 5 , 7 $ - , 0 0 0 0 0 0 , 7 - , 0 0 0 0 0 0 , 9 - , 0 0 0 0 0 0 , 9 , 0 0 0 0 0 4 , 4 0 0 0 , 0 0 6 0 1 , 0 0 0 , 0 0 0 0 1 , , 0 0 0 0 0 0 , 3 , 0 0 0 0 0 2 , 6 , 0 0 0 0 0 6 , 3 0 0 0 , 0 0 6 1 1 , , 0 0 0 0 0 5 , 3 0 0 0 , 0 0 2 0 1 , - , 0 0 0 0 0 5 , 8 - , 0 0 0 0 0 4 , 1 , 0 0 0 0 0 6 , 2 , 0 0 0 0 0 4 , 5 0 0 0 , 0 0 6 , 2 - 0 0 0 , 0 0 0 , 0 1 - 0 0 0 , 0 0 9 , 9 0 0 0 , 0 0 7 , 2 1 - - - - - - - - - - - - - - - 0 0 0 , 0 0 0 , 4 0 0 0 , 0 0 5 , 1 0 0 0 , 0 0 0 , 7 0 0 0 , 0 0 0 , 0 1 0 0 0 , 0 0 9 , 9 0 0 0 , 0 0 0 , 9 0 0 0 , 0 0 0 , 9 0 0 0 , 0 0 4 , 4 0 0 0 , 0 0 7 , 2 1 0 0 0 , 0 0 6 , 0 1 0 0 0 , 0 0 0 , 0 1 0 0 0 , 0 0 0 , 3 0 0 0 , 0 0 2 , 6 0 0 0 , 0 0 6 , 3 0 0 0 , 0 0 6 , 1 1 0 0 0 , 0 0 5 , 3 0 0 0 , 0 0 2 , 0 1 0 0 0 , 0 0 0 , 4 0 0 0 , 0 0 5 , 8 0 0 0 , 0 0 5 , 1 0 0 0 , 0 0 4 , 1 0 0 0 , 0 0 6 , 2 0 0 0 , 0 0 4 , 5 0 0 0 , 0 0 6 , 2 3 6 . 1 9 2 . 1 6 4 . 1 8 2 . 1 0 4 . 1 8 2 . 1 9 3 . 1 3 5 . 1 3 2 . 1 5 3 . 1 9 4 . 1 3 2 . 1 8 3 . 1 0 5 . 1 0 5 . 1 0 7 . 1 4 3 . 1 2 5 . 1 5 4 . 1 0 6 . 1 5 8 . 1 5 0 . 2 0 1 . 2 $ , 0 0 0 0 0 1 6 1 1 , $ 0 0 0 , 0 0 1 , 8 3 $ 0 0 0 , 0 0 2 , 4 5 1 $ - - 5 5 9 9 1 1 - - y l l a u n n a 8 2 . 9 0 n o 8 2 . 9 0 . 1 1 0 2 . d t L , . o C k n a B l a i c r e m m o C l a n o i t a n r e t n I a g e M B - 1 - 0 0 1 - s d n o b d e r u c e s n u c i t s e m o D y l l a u n n a 1 1 . 1 0 n o y l l a u n n a 1 1 . 1 0 n o y l l a u n n a 2 0 . 8 0 n o y l l a u n n a 2 0 . 8 0 n o y l l a u n n a 6 2 . 9 0 n o y l l a u n n a 6 2 . 9 0 n o y l l a u n n a 9 0 . 0 1 n o y l l a u n n a 4 0 . 1 0 n o y l l a u n n a 4 0 . 1 0 n o y l l a u n n a 4 0 . 1 0 n o y l l a u n n a 6 0 . 2 0 n o y l l a u n n a 6 0 . 2 0 n o y l l a u n n a 6 0 . 2 0 n o y l l a u n n a 6 1 . 7 0 n o y l l a u n n a 6 1 . 7 0 n o y l l a u n n a 9 0 . 8 0 n o y l l a u n n a 9 0 . 8 0 n o y l l a u n n a 5 2 . 9 0 n o y l l a u n n a 5 2 . 9 0 n o y l l a u n n a 5 2 . 9 0 n o y l l a u n n a 5 2 . 9 0 n o y l l a u n n a 5 2 . 9 0 n o 1 1 . 1 0 . 2 1 0 2 1 1 . 1 0 . 2 1 0 2 2 0 . 8 0 . 2 1 0 2 2 0 . 8 0 . 2 1 0 2 6 2 . 9 0 . 2 1 0 2 6 2 . 9 0 . 2 1 0 2 9 0 . 0 1 . 2 1 0 2 4 0 . 1 0 . 3 1 0 2 4 0 . 1 0 . 3 1 0 2 4 0 . 1 0 . 3 1 0 2 6 0 . 2 0 . 3 1 0 2 6 0 . 2 0 . 3 1 0 2 6 0 . 2 0 . 3 1 0 2 6 1 . 7 0 . 3 1 0 2 6 1 . 7 0 . 3 1 0 2 9 0 . 8 0 . 3 1 0 2 9 0 . 8 0 . 3 1 0 2 5 2 . 9 0 . 3 1 0 2 5 2 . 9 0 . 3 1 0 2 5 2 . 9 0 . 3 1 0 2 5 2 . 9 0 . 3 1 0 2 5 2 . 9 0 . 3 1 0 2 . d t L . d t L . d t L . d t L . d t L . d t L , . o C k n a B l a i c r e m m o C l a n o i t a n r e t n I a g e M , . o C k n a B l a i c r e m m o C l a n o i t a n r e t n I a g e M , . o C k n a B l a i c r e m m o C l a n o i t a n r e t n I a g e M , . o C k n a B l a i c r e m m o C l a n o i t a n r e t n I a g e M . d t L , . o C k n a B l a i c r e m m o C n o b u F i e p i a T , . o C k n a B l a i c r e m m o C n o b u F i e p i a T 2 - 0 0 1 - s d n o b d e r u c e s n u c i t s e m o D A B - - 1 - 1 0 1 - s d n o b d e r u c e s n u c i t s e m o D 2 - 1 0 1 - s d n o b d e r u c e s n u c i t s e m o D A B - - A B - - . d t L , . o C k n a B l a i c r e m m o C n o b u F i e p i a T . d t L . d t L , . o C k n a B l a i c r e m m o C n o b u F i e p i a T , . o C k n a B l a i c r e m m o C n o b u F i e p i a T . d t L , . o C k n a B l a i c r e m m o C n o b u F i e p i a T . d t L . d t L , . o C k n a B l a i c r e m m o C n o b u F i e p i a T , . o C k n a B l a i c r e m m o C n o b u F i e p i a T . d t L , . o C k n a B l a i c r e m m o C n o b u F i e p i a T . d t L , . o C k n a B l a i c r e m m o C n o b u F i e p i a T . d t L . d t L . d t L . d t L . d t L . d t L . d t L , . o C k n a B l a i c r e m m o C n o b u F i e p i a T , . o C k n a B l a i c r e m m o C n o b u F i e p i a T , . o C k n a B l a i c r e m m o C n o b u F i e p i a T , . o C k n a B l a i c r e m m o C n o b u F i e p i a T , . o C k n a B l a i c r e m m o C n o b u F i e p i a T , . o C k n a B l a i c r e m m o C n o b u F i e p i a T , . o C k n a B l a i c r e m m o C n o b u F i e p i a T 1 - 2 0 1 - s d n o b d e r u c e s n u c i t s e m o D 2 - 2 0 1 - s d n o b d e r u c e s n u c i t s e m o D A B - - 3 - 2 0 1 - s d n o b d e r u c e s n u c i t s e m o D A B - - 4 - 2 0 1 - s d n o b d e r u c e s n u c i t s e m o D A B C - - - A B C - - - L A T O T B C D - - - E - F - , . o C k n a B l a i c r e m m o C n o b u F i e p i a T 3 - 1 0 1 - s d n o b d e r u c e s n u c i t s e m o D 4 - 1 0 1 - s d n o b d e r u c e s n u c i t s e m o D Taiwan Semiconductor Manufacturing Company Limited STATEMENT OF NET REVENUE FOR THE YEAR ENDED DECEMBER 31, 2017 (In Thousands of New Taiwan Dollars, Unless Specified Otherwise) Shipments (Piece) (Note) 10,449,058 Item Wafer Other Net revenue Note: 12-inch equivalent wafers. STATEMENT 12 Amount $ 869,210,414 99,925,695 $ 969,136,109 - 196 - - 196 - Taiwan Semiconductor Manufacturing Company Limited STATEMENT OF COST OF REVENUE FOR THE YEAR ENDED DECEMBER 31, 2017 (In Thousands of New Taiwan Dollars) Item Raw materials used Balance, beginning of year Raw material purchased Raw materials, end of year Transferred to manufacturing or operating expenses Others Subtotal Direct labor Manufacturing expenses Manufacturing cost Work in process, beginning of year Work in process, end of year Transferred to manufacturing or operating expenses Cost of finished goods Finished goods, beginning of year Finished goods purchased Finished goods, end of year Transferred to manufacturing or operating expenses Scrapped Subtotal Others Total STATEMENT 13 Amount $ 3,864,429 39,679,243 (6,566,716) (8,153,898) (105,122) 28,717,936 14,088,114 439,610,993 482,417,043 32,317,210 (52,166,234) (13,503,059) 449,064,960 8,324,267 41,252,348 (9,596,837) (8,449,639) (294,486) 480,300,613 9,896,243 $ 490,196,856 - 197 - - 197 - STATEMENT 14 Taiwan Semiconductor Manufacturing Company Limited STATEMENT OF OPERATING EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2017 (In Thousands of New Taiwan Dollars) Item Research and Development Expenses General and Administrative Expenses Selling Expenses Payroll and related expense $ 27,419,259 $ 7,125,078 $ 2,028,116 Consumables 18,846,071 203,831 Depreciation expense 18,652,520 816,327 Repair and maintenance expense 3,426,711 1,679,314 Moving expense Service fee Patents Management fees of the Science Park Administration Commission Others (Note) Total 503,573 1,824,079 78,244 1,063,848 17,682 - - - 1,761,405 1,776,508 - - - 804,144 10,961,345 3,799,015 170,836 $ 79,887,723 $ 20,049,405 $ 3,048,781 3,376 21,163 2,940 524 Note: The amount of each item in others does not exceed 5% of the account balance. - 198 - - 198 - 5 1 T N E M E T A T S 6 1 0 2 , 1 3 r e b m e c e D d e d n E r a e Y 7 1 0 2 , 1 3 r e b m e c e D d e d n E r a e Y l a t o T s e s n e p x E d n a s a d e i f i s s a l C r e h t O g n i t a r e p O e m o c n I s a d e i f i s s a l C g n i t a r e p O s e s n e p x E s a d e i f i s s a l C e u n e v e R f o t s o C l a t o T s e s n e p x E d n a s a d e i f i s s a l C r e h t O g n i t a r e p O e m o c n I s a d e i f i s s a l C g n i t a r e p O s e s n e p x E s a d e i f i s s a l C e u n e v e R f o t s o C N O I T C N U F Y B N O I T A Z I T R O M A D N A N O I T A I C E R P E D , R O B A L F O T N E M E T A T S ) e s i w r e h t O d e i f i c e p S s s e l n U , s r a l l o D n a w i a T w e N f o s d n a s u o h T n I ( 6 1 0 2 D N A 7 1 0 2 , 1 3 R E B M E C E D D E D N E S R A E Y E H T R O F d e t i i m L y n a p m o C g n i r u t c a f u n a M r o t c u d n o c i m e S n a w i a T 1 9 4 , 9 1 8 , 3 3 3 6 , 7 0 0 , 2 9 1 0 , 0 4 5 , 2 6 0 7 , 3 7 7 , 9 7 $ 9 4 8 , 0 4 1 , 8 8 $ - - - - - 4 2 3 , 7 7 9 , 3 1 2 $ 6 6 0 , 4 2 7 , 3 $ - 7 8 8 , 4 2 $ 1 2 8 , 4 5 0 , 2 3 $ 5 8 8 , 8 1 7 , 7 4 $ 9 8 4 , 4 8 7 , 3 8 $ 0 5 5 , 2 0 7 8 7 8 , 7 4 8 3 5 6 , 5 2 4 , 1 8 3 8 , 3 9 3 , 2 3 8 0 , 5 0 3 , 1 1 4 1 , 2 9 6 , 1 8 5 8 , 7 1 2 , 4 5 9 9 , 6 7 1 , 2 9 2 1 , 9 0 6 , 2 $ $ $ 2 0 9 , 0 3 0 , 5 3 2 5 2 , 9 0 7 , 1 4 2 1 , 7 5 3 , 6 1 $ $ $ 7 4 9 , 9 0 1 , 3 5 $ 1 7 4 , 8 8 7 , 2 9 $ 3 1 3 , 5 9 5 , 7 9 1 $ 4 1 8 , 4 1 0 , 2 $ 5 3 1 , 7 9 5 , 0 5 2 $ 8 2 0 , 5 2 3 , 4 $ - 0 1 5 , 4 6 - - - - - - - 9 9 9 9 1 1 - - $ 9 9 5 , 6 2 6 , 3 3 $ 0 9 8 , 7 5 1 , 0 5 $ 4 5 0 , 1 7 7 4 4 3 , 8 9 8 7 9 5 , 9 8 5 , 1 1 6 2 , 8 2 6 , 2 1 4 9 , 5 0 4 , 1 5 8 7 , 0 1 7 , 1 $ $ $ 4 9 5 , 5 8 8 , 6 3 9 2 1 , 5 0 2 , 2 0 1 0 , 0 9 4 , 9 1 $ $ $ 7 7 8 , 2 0 9 , 5 5 $ 5 1 6 , 2 4 0 , 1 3 2 $ 9 9 8 , 9 1 1 , 2 $ e c n a r u s n i h t l a e h d n a r o b a L s u n o b d n a y r a l a S ) e t o N ( t s o c r o b a L n o i s n e P s r e h t O n o i t a i c e r p e D n o i t a z i t r o m A . y l e v i t c e p s e r , s e e y o l p m e 0 5 8 , 1 4 d n a 9 3 1 , 3 4 d a h y n a p m o C e h t , 6 1 0 2 d n a 7 1 0 2 , 1 3 r e b m e c e D f o s A : e t o N i T a w a n S e m i c o n d u c t o r M a n u f a c t u r i n g C o m p a n y , L t d . A n n u a l R e p o r t 2 0 1 7 ( I ) 

Continue reading text version or see original annual report in PDF format above