Page 202 - TSMC 2018 Annual Report

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
Components of defined benefit costs recognized in other
comprehensive income Total
Years Ended December 31 2018 2017
$ 137,758 $ 145,026 144,108 126,525 281,866 271,551
(71,288) 29,290 334,630 483,846
597,820
861,162 $ 1,143,028
(258,455) 254,681 $ 526,232
The pension costs of the aforementioned defined benefit plans were recognized in profit or loss by the following categories:
Years Ended December 31
Cost of revenue
Research and development expenses General and administrative expenses Marketing expenses
$
2018
177,772 79,143 20,591
2017
$ 175,357 75,340 16,669 4,185
$ 271,551
4,360 $ 281,866
The amounts arising from the defined benefit obligation of the Company were as follows:
Present value of defined benefit obligation Fair value of plan assets
Net defined benefit liability
$ $
13,662,684 (4,011,279)
9,651,405
December 31, 2018
December 31, 2017
$ 12,774,593 (3,923,889)
$ 8,850,704
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