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Article 10
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The liability account categories on the balance sheet, content thereof, and matters to be noted are as follows:
- "Due to the Central Bank and other banks" means deposits due to the Central Bank and other banks and overdrafts with and loans from other banks.
- "Payables" includes accounts payable, interest payable, income distribution payable, acceptances, and other payables.
- Accounts payable shall be valued at present value. However, those which result from operating activities and which become mature within one year may be valued at book value. Accounts payable resulting from operating activities shall be separately recorded from other accounts payable resulting from non-operating activities. Accounts of large value payable to related parties shall be separately disclosed. For secured accounts payable, name of collateral and book value shall be indicated. However, the same is not required for accounts receivable factoring.
- "Interest payable" means interest due to depositors and otherwise on loans borrowed.
- "Income distribution payable" means income distribution payable to trust fund beneficiaries.
- "Acceptances" means acceptance of a customer's draft to pay the amount at maturity.
- "Other payables" means amounts payable other than notes payable, accounts payable and interest payable, such as taxes payable and dividends payable. For the dividends payable passed by the resolution of the shareholders meeting, the distribution method shall be noted. When losses and profits are calculated for each period, the estimated income tax payable calculated based on taxable income shall be presented under other payables. If any item under other payables exceeds 5% of total payables, it shall be separately recorded based on the nature or party concerned.
- "Deposits and remittances" means check, current, term, and savings deposits and remittances.
- "Trust funds" means the trust funds under Articles 10 and 110 of the Banking Act, including designated trust funds and discretionary trust funds.
- "Borrowings from the Central Bank and other banks" means funds borrowed from the Central Bank with discounted notes or secured loans and funds borrowed from other banks with notes or otherwise.
- "Financial bonds payable" means the balance of financial bonds issued.
- "Other liabilities" means the liabilities not falling within the above categories, such as operating and liability reserve, other miscellaneous liabilities, etc. When the amount of other liabilities exceeds 5% of total liabilities, the title of the accounts shall be separately recorded. Other liabilities include liabilities from bills and bonds under repurchase agreements, reserve for guarantee obligations, securities trading loss reserve, default loss reserve, deposits received, deferred income tax liabilities, and other miscellaneous liabilities.
- "Liabilities from bills and bonds under repurchase agreements" means any dollar amount actually received from the trading counterpart in a repurchase transaction in bills and bonds.
- "Reserve for guarantee obligations" means the reserve set aside from various balances of guarantees, based on assessment of actual situation.
- "Securities trading loss reserve" means the reserve set aside as required to offset losses on trading securities.
- "Default loss reserve" means, with respect to acceptance of an order to buy or sell securities, the reserve set aside from the service charge revenue to cover the loss that may arise from default by the customer.
- "Deferred income tax liabilities" means deferred income tax effects of taxable temporary differences.
- "Other miscellaneous liabilities" means liabilities not falling within the above categories, such as deferred revenue and premium on forward exchange contract.
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Article 11
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The shareholders' equity account categories on the balance sheet, content thereof, and matters to be noted are as follows:
- "Capital stock" means the capital invested in the Bank by shareholders and applied for registration with the competent authority for company registrations. The type of capital stock, number of authorized shares, number of issued shares, and special terms shall be indicated. If convertible preferred stock and overseas depositary receipts are issued, the place of issue, issuance and conversion methods, converted amount and special terms shall be disclosed.
- "Capital reserves" means the premiums generated through capital stock transactions between the Bank and shareholders, usually including premium over shares issued above par value, donations from shareholders, and such others as generated under generally accepted accounting principles. Capital reserves shall be listed separately according to their nature, and circumstances relating to any limits on the utilization thereof shall be disclosed in footnotes.
- "Retained earnings" (or "accumulated deficit") means the equity resulting from operating activities, including legal reserve, special reserve, and unappropriated earnings (or deficit to be offset), etc.
- Legal reserve means the fixed-percentage reserve required to be allocated by Article 50 of the Banking Act.
- Special reserve means the reserve allocated from earnings in accordance with relevant laws and regulations, contracts, articles of incorporation, or resolutions of shareholders meetings.
- "Unappropriated earnings" (or "deficit to be offset") means the undistributed and unappropriated earnings (a deficit to be offset is the loss not yet recouped).
- Distribution of earnings or offsetting of deficit shall not be accounted for until approved by the shareholders meeting. However, when an earnings distribution or offsetting of deficit has been proposed, such shall be disclosed in footnotes to the current financial statements.
- "Other shareholders' equity items" means other items resulting in increases or decreases to shareholders' equity, usually including unrealized losses on market value decline of long-term equity investments, net losses not recognized as pension costs, translation adjustments, treasury stock, etc.
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