| 24. | Finance Lease Liabilities |
| (1) | Lease contracts |
The Company enters into power purchase agreements (“PPA”) with GS EPS and three other providers. The Company recognizes these PPAs as finance leases; under the PPAs, there is no transfer of ownership or bargain purchase option of the plants at the end of the agreement, however, the present value of the future minimum power purchase payments equals substantially all of the plants’ respective fair values over a twenty-year period which makes up the major part of the respective plants’ economic life.
| (2) | Finance lease liabilities as of December 31, 2016 and 2017 are as follows and are included in current and non-current trade and other payables, net, in the consolidated statements of financial position: |
| 2016 | 2017 | |||||||||||||||||||
| Minimum lease payments |
Present value of minimum lease payments |
Minimum lease payments |
Present value of minimum lease payments |
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| In millions of won | ||||||||||||||||||||
|
Less than 1 year |
￦ | 175,512 | 121,176 | 174,534 | 131,792 | |||||||||||||||
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1 ~ 5 years |
404,029 | 306,282 | 272,994 | 204,069 | ||||||||||||||||
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More than 5 years |
152,247 | 113,721 | 108,748 | 82,399 | ||||||||||||||||
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| ￦ | 731,788 | 541,179 | 556,276 | 418,260 | ||||||||||||||||
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| (3) | Current and non-current portion of financial lease liabilities as of December 31, 2016 and 2017 are as follows: |
| 2016 | 2017 | |||||||||||
| In millions of won | ||||||||||||
|
Current finance lease liabilities |
￦ | 121,176 | 131,792 | |||||||||
|
Non-current finance lease liabilities |
420,003 | 286,468 | ||||||||||
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| ￦ | 541,179 | 418,260 | ||||||||||
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| (4) | Minimum lease payment and contingent rent payment recognized as an expense as a lessee for the years ended December 31, 2016 and 2017 are as follows: |
| 2016 | 2017 | |||||||||||
| In millions of won | ||||||||||||
|
Minimum lease payment |
￦ | 177,585 | 158,859 | |||||||||
|
Contingent rent payment |
(20,956 | ) | (21,024 | ) | ||||||||
| (5) | The Company does not have any irrevocable operating lease contracts as of December 31, 2016 and 2017. |
| (6) | Changes in finance lease liabilities for the year ended December 31, 2017 are as follows: |
|
Beginning balance |
Cash flow |
Ending balance | ||
| In millions of won | ||||
| ￦541,179 | (122,919) | 418,260 | ||