Hyundai Motor Company

Annual Fin

ancial Report

HYUND

AI MO

TOR COMP

ANY

or the year

ended Dece

mber 31, 202

Management Report

Business Overview

Based

sales

3.89

mil

lion

units

2021,

the

company

posted

trillion

won

sales

rev

enue in

automotiv

e division

on a consolidated

basis. Although sales hav

e declined slightly

due to

continue

d ins

tab

ity in

global semiconduct

or supply and

demand

, ov

erseas sale

s ha

increased

due

to the

low

base

effect

from the

spread of

OVID-

19 and

reco

very of

demand in

global automo

tive markets

such as the U.

S., Eur

ope and emer

ging markets.

mid-

long-

term

stra

tegy f

sustainabl

growth,

our

company

pushing

for

the

transition

smart

mobility

solution

company.

are

making

arious

eff

orts

provide

customer

with

sustain

able

mobility

xperience

based

digital

technology

and

are

also

working

quality-ba

sed

val

ues

for

personali

zation

and

gital

experience

hile

pur

uing

the

coexi

stence

humans

and

nature.

order

ccessfull

tra

nsform

ourselve

into

smart mobility solution company

, we are establishi

ng and implementing three stra

tegic

directions:

①

enhancing

the

competitiv

eness

the

automotiv

business

and

preemptiv

transition

electri

fication ②

establishing the

foundati

on f

or the

mobility

service business

③

securing the h

ydrogen ecos

ystem ini

tiativ

2. Major references for business industry

(1) Chara

cteristics

of Ind

ustry

The automotiv

e industry

assumes a broad

industrial ba

se, so it has a v

ry large front-

-rear

industry linka

ge effect c

ompared to other i

ndustries. Auto

motive industry can be larg

ely

divided into manu

facturing, distribu

tion, and operation

. Manufacturing

has connecti

ons with

other industries in

cluding steel, chemical

s, electr

icity, electronics, rubber,

glass, plastic

industry and com

ponents maker

that produ

ce about 20,

000 parts. Dis

tribution invol

ves

direct sales of

finished car mak

rs, deal

erships, financin

g, consign

ment compani

es, and

operation invol

ves maintenan

ce, component

s, refueling, and i

nsurance ind

ustry.

(2) Growth for Indu

try

The growth of th

e automoti

ve industry wa

s driven by the go

rnment'

s industrial poli

cy and

industry's constant

resear

ch and developmen

t effor

ts, as the domestic

and over

seas

markets continu

d to expand.

Korea's automoti

ve industry has

produced

a total of

2.65

million

cars since 1976, when it

began ex

porting its firs

t unique model

, the Pony,

to the

domestic mark

et by 2021, of w

hich 42.3%,

47.6 mill

ion, were sold in Kor

ea. The remaining

57.7%, 64.

94 million uni

ts, were sold to

overseas

markets.

(3) Economic fluct

uation

Demand for au

tomotive i

s closely relat

ed to economi

c fluctuation. Th

e relation

ship is more

evident when

demand for automo

tive rea

ches a certain lev

el or higher a

nd the growt

h of

demand for automoti

ve slow

s down. When

the supply o

automotiv

began in earnest,

demand for automoti

ve increa

sed rapidly r

egardless of econo

mic fluctuation. Howev

er,

since then, it ha

s been se

nsitively affected

by economic flu

uation, such

as changes in

economic growt

h. During th

e economic downtur

n, consumption slows down du

e to weak

investment and

reduced employ

ment, whic

h greatly affects spending. Dur

ing this period

demand for automoti

ve, a typic

al durable produ

ct, shows a greater decline

compared to

other consumer

goods.

(4) Competitiven

Because the auto

motive industry i

s a large-scale

manufacturing

industry wi

th huge capital

each country ha

s establi

shed an oligopoly

system with a s

mall number

of compani

s. It is

unlikely to succe

ed in this b

usiness even

for a company

with enormou

resourc

es, because

building a certain

amount of ma

ss-production fac

ilities requi

res a huge am

ount of money

and takes at l

east four to five ye

ars to launch th

e product aft

er the decision

to enter. In

addition, autom

akers ha

ve tens of thousand

of empl

oyees and thou

sands of suppli

ers. Even

if the poor p

erformance i

prolonged,

it is necessa

ry to be car

eful in restruc

turing or

shortening o

perations in consid

ration of th

e impact on

the national

economy.

Key competiti

ve factors in th

e automotive indu

stry include pro

duc

t comp

etitivenes

rketing skil

ls, and cost com

petitiveness.

These three fa

ors are criti

cal to stren

gthen

dominant position,

reducing co

sts, and securin

profitabili

ty. The most impor

tant factor,

product comp

etitiveness, is maximi

ing sati

sfaction for

vehicle per

formance, safety, design,

quality, and new

technologi

es and let automak

er have competitiveness co

mpared to pe

ers.

Marketing skill

s increase

competitivene

ss by activ

ely attracting cu

stomers thr

ough creation

of product con

cept whic

h customers nee

d, new product lau

nch,

advertisin

g, sales, and A/

network constructi

on. Cost comp

etitivenes

s is a total cost conc

pt that in

cludes new

product developm

nt cost, produ

ivity of

mass productio

n, indirect wor

kforce produ

ctivity,

and financial cost

, which

has huge impa

ct on price competitiv

eness and p

rofitability.

3. Market and business

conditions by region

(1) Korea

In 2019, due to

sluggish

sales of mid-sized vehicl

s and lower

segment,

industry deman

decreased. Howe

ver, in 202

0, despite negati

impact of COVID-19, i

ndustry demand

increased due to

consumption

tax cut and

new model cycl

e from major OEMs. In

2021,

industry deman

d and our sal

es declined due

to semiconduc

tor chip shor

tage caus

ed by

COVD-19. Nev

ertheless, we

expect industry

demand and

our sales to increase

with our

efforts to diver

sify sales chann

els, rapid tran

sition to ele

ctrification and

new mod

el launches.

<Our Business

In 2021, we sol

d 72.7 mil

lion units (

based on retail

)

in the Kore

an market, a

7.7% decr

ease

from the previo

us year due to semicon

ductor chip shortage.

The company is

striving to sati

sfy customers

through produc

t developme

nt, price policie

and services amid

intensi

fied comp

etition. In 2017

, we launched t

he Kona and

Genesis G7

small SUVs, an

d in 2018,

we launched the Nexo,

a hydrogen-electri

c vehicle,

to strengthen

our eco-friendly

car line-up. In 20

19, we launch

d the Venue

, a small S

UV aimed at

millennial generati

on. In 202

0, the Gene

sis line-up was strength

ened thro

ugh the GV80 an

The All-new G8

0. In addit

ion, we implemented

a "good price" pol

icy that lowere

d the prices

of popular mid- to

large-sized and

high-performa

nce models and expanded an

d reorgani

zed

its service bran

d "bluemember

" for massive cu

tomer ser

vice innovati

on. Meanwhil

e, we

developed eco-

friendly vehicle

s for sustai

nable managem

ent. We strive to

cre

ate

environmental

and social valu

s such as

creating a low-carbon

society and

accompanied

growth with our

partners. In a

ddition, we ha

e selected

37 social welfare

projects an

provided various

support. In 202

1, we sold

72.7 mil

lion units (based on

retai

l) in the Korean

market, a 7.7%

decline on a y

ear on year

basis, but re

corded a 42% mark

et share (including

imported cars)

by streng

thening of th

e Genesis br

and line-up and expandi

ng sales of

volume

models.

Also, followi

ng the launc

h of the IONIQ

5, first model

based on our

EV dedicat

ed platform, E-

GMP, we hav

e been leading th

e developm

nt and

sales of eco-friendly vehicles by

launching

the electric vehi

cles in gene

sis brand such

as electrified

G80 and GV60, taki

ng lead to

electrify automoti

ve market in

Korea.

(2)

U.S.

In 2019, although

sales smal

l-sized commercial v

ehicle continu

ed to incre

ase, passenger

vehicle sales w

ere sluggi

sh due to decre

ase in ind

ustry demand.

Overall sales d

ecreased i

n 2020 due

to productio

n disruption an

d sluggish

demand cau

sed

by COVID-19. In

2021, sal

es in the U.S.

market increas

ed by 3.4 p

ercent yoy to 15

million

units (based on

retail sales

). In the fir

st half of the

year, sales conti

nued to i

ncre

ase as it

escaped the shoc

of COVID-19 com

pared to th

e previou

s year, but it r

ecorded th

e low sales

in the second h

alf due to prol

onged shorta

ge of s

emiconductor

chip suppl

y which was

severe especiall

y in the s

econd half of th

year.

<Our Business

2021, on th

e back of stro

ng sales of SU

V models in ge

nesis brand

sch as GV70 a

nd GV80,

sales more than

tripled compare

d to the previo

us year and our

sales increased by

23.3% to

788 thousand

units and r

ecorded market

share of 5.2%.

(3) Asia Market

China, Asia's l

eading mar

ket, has surpa

ssed the U.

S. as the world'

s No. 1 automo

bile market

since 2009, and

as dema

nd increases alon

with income

growth, maj

or companies

are

actively expanding

their

sales by increa

sing their pro

duction capabilities and

sales network

in the Midwest inl

and.

However, th

e demand in Ch

ina slow

down at the tank l

vel due to

slowing econo

mic

growth and prol

onged trade disput

es in 2019, and sal

es continued to

decli

ne in 2020 due to

weak consumpti

on caused by

COVID-

19.

In 2021, 19.88

million

units were sold i

n the Chine

se market, up

2.3% from the pre

vious year.

Sales rose sharpl

y in the

first quarter due

to the base

effect of the

lock-down

implementation

following th

e spread o

f COVID-19 in the previous

year, but overal

l sales

growth was som

ewhat limited

as the issu

e of insufficie

nt semiconductor supply inten

ified

from the secon

d quarter.

Meanwhile, th

e Indian market has

grown rapidly

as the gov

ernment l

ed the dev

elopment of

the automobil

e industry, and t

he proportion of

medium-sized cars

and abo

ve is gradually

increasing due to

the improvement of incom

e levels in the light-duty car-oriented car-cla

structure. Howe

ver, In 2019, d

emand shran

k due to the liquidi

ty crun

ch in the finan

cial

sector, and it

decreased signifi

cantly compar

d to the pr

vious y

ear. In 2020, deman

plunged due to

the sprea

d of COVID-19.

In 2021, 310.

5 million

units were sold, u

p 27.3% fr

om the previous year. Aft

r strong sal

es in

the first quarter

due to C

OVID-19, there was a

temporary decreas

e in demand du

e to the

regional lock-down

caused

by the spread

of delta muta

tions in May

, but it

gradually

recovered until

August. L

ater, the decre

ase in pro

duction by ea

ch compan

y due to the

global shortage o

f semicon

ductor supply oc

curred from

September to the end o

f the year.

<Our Business

In the Chin

ese market in 202

1, Hyundai Motor

old

35.5 milli

on units (based on w

holesale

sales), down

20.4% year-

-year, a

ccounting for

1.8% of the mark

et share. Sales of

LaFesta

and ix25 were

sluggish, but the decli

ne (2020 -32.3

%) was redu

ced compared to

the

previous year

due to stro

ng Avante sales

and new car

effects suc

h as Tucson/C

ousteau.

In the Indian mark

et, Crete,

Venue, and Cu

tos were

boosted by risin

demand.

As sales of

major models su

as th

e i20 continued to be s

trong, we sold

505,000 uni

ts in 2021, u

19.2% from the

year.

We are actively

triving t

o sustain balanc

ed growth of

sales, servi

ces, and brand

s from a

long-term persp

ctive. As a

result, In the

"2018 Chi

na Automobile C

ustomer Satisfaction

Index (CACSI)"

released by th

China Mas

s Quality Associa

tion, Verna won

India's iCOTY

(Indian Car of th

Year) a

nd met the

expectations

of local customer

. In the 20

19 New

Vehicle Quality

Survey (IQS),

47 general

brands were sele

cted. In particular, La Festa rank

first in the 20

19 JD Power New

Model Quali

ty Survey mid-size car clas

In 2020, it was

selected in 5

out of 7 cat

egories b

y the JDP IQS

(India's New V

ehicle Quali

Survey), which

selects 3 car

s for each

category. (

Compact: Santro

Premium Comp

act: Elite

i20, Mid-size: N

xt Gen Verna,

Compact S

UV: Ven

ue, SUV: Creta).

(4) European Market

The European

market, whi

ch has continue

d to grow st

eadily in the p

ast, saw a shar

p drop in

sales in the wak

e of the 200

8 global financial

crisis. Consu

r sentim

ent cool

ed down due

to austerity measur

s and slu

ggish emplo

yment, and sales

declined for

six c

onsecutiv

e years

from 2008 to

2013.

And as the financial

crisis ent

ered a calmi

ng phase

the deman

d started to r

ebound from

second half of 2

013. In 2018, i

t was sold at

a similar level

to the previou

year. In

2019, sales

in Germany, Franc

e, and Italy in

creased slightly c

ompared to the previous

year. In 202

0, it

decreased by 2

4.3% compared to

the previo

us year due to

production/

ales disruptions

and

worsening con

sumer sen

timent caus

ed by the im

pact of COVID-

19.

In 2021, 17.75

million

units were sold i

n the European mark

t, down -1.5%

from the previous

year. The reco

very in sales from

COVID-19 last y

ear has been d

elayed du

e to supply

disruptions caus

ed by supply an

d demand pro

blems in semicon

duc

tors an

the spr

ead of

the COVID-19 mut

ant virus.

In the Europ

ean market i

n 2021, Hyundai

Motor s

old 50.5 milli

on units (based on

retail), up

36.7% from the

year, securin

g a 4.3% ma

rket share in the entire m

arke

t. BEV an

PHEV sales incr

eased 26.5% an

d 352.5%, r

espectively,

from the

previous year, thanks to the

launch of the Ioni

q 5 and Tucson plug-in hybrids.

In order to secur

profitabil

ity,

the company avoid

s excessive in

ntives an

strives for

qualitative growt

h by str

engthening int

ernal stabil

ity rather than ex

panding its app

earance.

Therefore, we ar

e strengthening

our position

in the cons

rvative Eur

opean mark

et based on

technological prow

ess and design exc

ellence.

As a result, in 2

019, Ionic and

i30N were sel

ected in th

e Hybrid Car of

the Year

category and

the £22,000 to

£27,000

Best Hot H

atch categor

y by WhatCar

agazine,

the most pr

estigious

automotive maga

zine in the UK

, and the Kon

a was named the

2019 Car o

f the Year by

Spain's leading

newspaper A

BC. At the U

K's 2020 What Car

Awards, th

e i30 N 2.

0 T

-GDi was

named Best Hot H

atch. In 20

21, the Ioniq 5 won

the New En

ergy categor

y at the G

erman

Car of the Year.

4. Company Environmen

tal Regulations

To strengthen ou

r comprehe

nsive abili

ty to respond to

global en

vironmental issu

es and

regulations, the com

pany

s set goal

for climat

e change respon

se and c

arbon neutrality,

and are strengthe

ning envir

onmental mana

gement bas

ed on them.

The company aim

s to be carbon

neutral by

2045 in all st

ages from proc

urement of

automobile part

s to productio

n and operation

with th

e determination

to curb global

temperature ri

ses to withi

n 1.5

℃

and to think

about sustaina

ble progress toward futur

humanity and the

global environ

ment.

We are shiftin

g its intern

al combustion

engine ve

hicle-oriented product a

nd busines

structure to

electric vehi

cles first for

carbon redu

ction and zero-emission of vehicle

sold.

With the goal of

converti

ng electric vehicl

s (BEV, FCEV) to th

e European

market in 20

35,

we are planning

to fully el

ectrify vehicles sold

in major

markets by 20

40.

The company

plans to accelera

te electrific

ation in

emerging marke

t as well, by

considering

customer need

s, market

conditions, an

d infrastructure construction

tatus.

We plan to establi

h a RE

100 roadmap

that aims to cov

r 100% o

f renewa

ble energy

global factorie

s by 2045,

ahead of the

global RE100 ini

tiative recomm

endation

goal of 2050,

and to promote

carbon neutrali

ty in our workplac

s by expanding th

appli

cation of green

hydrogen to major

manufacturi

ng process

es.

To this end, the

company plans

to gradually con

vert 100% of renewabl

e energy

in global

plants by 20

45, taking into acco

unt the envir

onment for ren

ewable en

ergy supply

and

demand and gov

rnmen

t policies/regulati

ons in countr

ies such as India

and the United

States, startin

g with the Czech

plant, which is easy to

supply renewa

ble energy.

In order to grad

ually expand t

he application o

renewable en

rgy, opti

mal solutions wi

applied in consid

eration of plan

t-specific conditio

ns such as ins

tallation of solar pan

els on

the roof of pro

duction pl

ants, purchase of

renewable

energy certi

ficates, a

nd power

purchasing agr

eements (PP

A) with external r

enewable

energy gen

rators.

The company has

participat

ed in the CDP

evaluation

, a global carbon

disclosure proje

ct for

climate chang

e greenhouse g

as response a

ctivities, sinc

e 2007. Throu

gh continuous e

fforts

to reduce greenhou

e gase

s and strengthe

n the managem

ent system

, we receiv

d the Best

Award for Car

bon Managem

ent Honors Clu

b and Water Re

source Mana

gement for

two

consecutive years in

2020 and the Excell

ence Award for

Water R

esource Mana

gement in

2021.

In addition,

participated i

n the Dow Jon

es Sustainable

Management

Index (DJSI)

evaluation from

2019 and wa

s incorporate

d into DJSI

Korea. In 20

21, the company

was

included in the

DJSI Worl

d Index, which is

the highest grad

. This mean

s that th

sustainable manag

ement evaluati

on is in th

e top 10%

among the top

2,500 gl

obal

companies bas

ed on mar

ket capitalization

plan to conti

nue to mak

e efforts to

selected for the

DJSI Wo

rld Index by establishing an E

SG consultati

ve body at the

enterprise

level, strength

ening clim

ate change r

esponse suc

as establi

shing carbon

neutral stra

tegies

and introducing

ESG risk

assessments for wor

kplaces and

suppliers.

From the persp

ective of P

IR (Post Industrial

Recycled), the company

plans to co

ntinuously

implement d

esign consi

dering the a

pplication of r

ecycled materi

als to major parts of

automobiles and

the recycli

ng of waste vehi

cles. We ar

e continuously

appl

ying plastic

recycled mat

erials to veh

icle parts by uti

lizing waste r

esources reco

red fr

om waste car

parts. In 2020

, the scope

of parts to be ap

plied was exp

anded to d

evelop new recyclable

materials for cowl

top cover. The

newly launch

ed G80 and

Ioniq 5 also

appli

ed recyclable

materials and

biomaterials to int

erior materi

als.

The upcycli

ng project “Re:

Style” is a proj

ect designed

to spread th

e upcycling trend

around

the world throu

gh the uni

que collaboration of

automobil

es and fashion,

with the im

portance

of “Sustainabil

ity” increa

sing day by day.

It has been reint

rpreted

as new items

such as accessori

es by util

izing materi

als that are

mostly discarded

during the scrappin

process du

e to low recycl

ing rates s

uch as glass and

airbags as well

as car waste l

eather.

Hyundai Motor wil

l continue

to inform th

e automotive in

dustry and th

e fashion indu

stry of

its sustainabili

ty by redef

ining discard

ed automob

ile waste as a

valuable fashion item.

In addition, wast

e nets discar

ded in the sea

will be collect

ed and upcy

cled with echony

l (a

material that can

be biod

egraded with nyl

on made by u

ycling n

ets and cloths)

to be used

to make new

products su

ch as bracelet

s, and furt

her, various usability will

be reviewed in

our vehicles.

Exhaust gas and

air pollu

tants that inevitably

occur in th

production

and use stag

es of

automobiles aff

ect the air en

vironment. The com

pany strives to

minimize ai

r pollution by

continuously developi

ng and applyi

ng technologi

es to reduce automobile

xhaust gas and

air pollutants in f

actories.

For vehicles sold

in Europe, vehi

cles certifi

ed after

January 2020 ar

manufactur

d to meet

Euro-6d standard

s, and for

all gasoline (inclu

ding hybrids) vehicles sold

and register

locally after Se

ptember 201

9, The Euro-6d standa

rd is the mo

st stringent emi

ssion standard

required in Europ

e as of

2020, and th

e actual nu

mber of particl

s (PN) an

d nitrogen o

xides

(RDE) are teste

d on the r

oad.

In addition, accordin

g to the enhanced Int

ernational

Standard Test

Method (WLTP), the

laboratory mea

sures emission h

armful substances (carbon

monoxide

, nitrogen oxi

des,

hydrocarbons, parti

culate matter (PM), nu

mber of parti

cles (PN), and

fuel efficien

cy.

We have develop

ed emission re

duction sy

stems and engin

s that compl

y with the

enh

anced

actual emission t

est standard

s and test method

to realize vehicl

e emission reduction.

Furthermore, the

company is pre

emptively re

sponding to th

e Euro-7 regulation

, which is

expected to be

applied in 2

025. The

Euro-7 regulation is ex

pected to stre

ngthen the

regulation of h

armful emi

ssion substances

compared to th

existing

Euro

-6d standar

ds and

add new emis

sion regulati

ons such as am

monia (NH3) and

nitrous oxid

(N2O), and

strengthened

actual roa

d emission test

(RDE), tir

e/brake du

st control

We expect to includ

regulati

ons on battery dura

bility in electric and hybrid

vehicles an

d are

preparing to re

spond.

Vehicles sold in No

rth America

have been

manufactured

to meet emi

ssion Tier-3 and LEV-III

standards for n

w certified

vehicles sinc

2015. Thi

s is

a regulation

that further r

duces

smog-related hydro

carbons and nitrogen oxi

des by

80% compared to

existing Tier-2 and

LEV II.

In addition, parti

culate m

atter (PM) shoul

d be further r

duced by

70% compared to

the

previous one.

As the actual

road verification has r

ecently been

strengthen

ed,

we are

developing the

vehicle b

y thoroughly designi

ng and verifyi

ng the actual

road emissions

other than the e

missions generat

d when

driving in th

e laboratory.

In the case o

f diesel vehi

cles sold in Kor

ea, since Octob

2017, n

wly cer

tified vehicle

s have

conducted emissi

on tests (RD

Es) on the a

ctual number

of nitrog

en oxides and

particles on

the road, and

since January

2020, newly c

ertified vehicl

es have been

responding to s

tricter

RDE regulation

s. The emi

ssion is measured accor

ding to the In

ternational

Standard Test

Method (WLTP)

of the str

icter test metho

d. We ar

e manufacturin

g an emission

reduction

device for this. Ga

soline/LPG

vehicles hav

e been developed

to satisfy

the same LE

-III

standards as the

US for al

l vehicles after January

2020.

※

However,

exclude 15-seater

vans (Stare

x LPI) and light/

small cargo

gas vehicles (Bon

LPI)

< Hazardous materials >

The company id

entifies the tr

ends in regul

ations on

harmful substanc

es in dom

estic and

overseas produ

cts and imme

diately reflects

them in our

products. In 2

004, we introduc

the International

Material Data

System (IMD

S) to check wheth

er all chemi

cal substances in

parts produc

ed by our suppli

ers are satisfi

ed with the re

gulations in th

e new car

development

stage. The company also

conducts r

egular inspec

tions on mass-produced

vehicles to che

ck for harmful

substances. W

e prevent th

e use of harm

ul subst

ances. In

addition, we provid

e organic cooperation and

support to our

affiliates

and partner

s in

cooperation with u

to respond to

regulations on

harmful substan

ces. In or

der to fulfil

l our

social responsibil

ity by provi

ding safe produ

cts to our custom

rs, we are

preemptiv

ely

reviewing the

application of al

ternative subs

tances regardl

ess of wheth

er they are re

gulated

or not.

In addition, Hyu

ndai Motor

Company restrict

s the use o

f chemical pro

ducts containing

high

hazardous subst

ances su

ch as carcinogen

in fact

ories in accor

dance with

its own chemical

management stand

ards that reflect regulati

ons on harmful su

bstances for

the

health

workers workin

g at prod

uction sites, and

strives to z

ero harmful sub

stances throug

h the use

of substitutes.

5. Mid- and long-term strategy of th

e company

As a mid- to long-

term str

ategy for sustaina

ble growth, we are pur

suing a transition to a

smart mobility soluti

on company,

and we

have establi

shed three strat

egic directions for this.

①

Improve the competiti

veness of the finished car

business and lead the el

ectrification

process

The company is

striving to improv

profitabili

ty by raising product and

brand value,

innovating cost

structure, stren

gthening qu

ality competi

tiveness, op

timizing global

production and SC

, and stren

gthening da

ta and digital cap

abilities. At the same

time,

we are pursuin

g growth strat

egies based on

leading electrification

leaders

hip, diversifying

product lines, and

process inno

vation.

The company is

also pursui

ng to improve both

profitabil

ity and growth thro

ugh regional

system stabili

zation and

customized strat

egies for each r

gion.

②

Establishment of foundation

for mobility service business

In order to esta

blish a foundatio

n for the

mobility servic

e business, we

are making

great

efforts to pack

age products

and services,

commerciali

ze community mobi

lity services

including autonomou

s driving, and strengthen th

e open data s

ervice busines

③

Securing hydrogen ecosystem ini

tiatives

plan

establish

and

implem

ent

carbon

neutral

strategi

connection

with

the

hydrogen

bus

iness,

and strive

to s

ecure

hydrogen

ecosystem

ini

tiatives with th

e ai

m of

establishing

ecosystem

for

transportati

fuel

electronic

systems,

strengtheni

technological co

mpetitivene

ss, and preoc

cup

ying the mark

et.

6. 2022 Company Guidance

the

beginning

2022,

the

company

announced

the

annual

global

wholesales

targe

4.32

million

units, a 11.

1% incre

ase in year

year.

Despite

prolon

ged

production

disruption

caus

chip

supply

issue

tapering,

and

the

spread

Omicron, we

e e

xpecting

6% to

of indus

try

demand grow

compared to

last

year.

for

the

company

will

promote

normaliza

tion

sales

throu

maximum

supply

and acceler

ation of electr

ification

through dedica

ted

EV line ups.

In terms of consolidate re

nue in 2022

considering volume increase,

continuous expansion

SUV

and

eco-friendly

vehi

cles

portion,

addition

normaliza

tion

external

factor

including

chip

shortage

issue

and

COVID-

along

with

stable

growth

finance

and

others

divisions, we are e

xpecting a growth

of 1

3% to 14%.

For

operating

profit

margi

are

arg

eting

lev

the

back

sales

vol

ume

increase,

continuous

mix

improv

ement,

cost

innov

ation

effor

and

stable

performance

of finance and other

s division.

The inve

stment plan in

2022 is 9.2 trillion KRW

, a

15% increase from

last

year

will focus on

securing

competen

future

business,

R&D

inv

estment

electrifica

tion,

and

strengtheni

ng sy

stem regardin

quality

, saf

ety

, and envir

onment

al responsibil

ities.

Responsibility Statement

To the best of my knowledge, the financial statements prepared

in accordance with

the applicable set of accounting standards give a true and fair view

of the assets,

liabilities, financial position and profit or loss of Hyundai Motor Company and th

undertakings included in the consolidation taken as a whole and that the

management report includes a fair review of the development and p

erformance of

the business and the position of Hyundai Motor Company and the u

ndertakings

included in the consolidation taken as a whole, together with a description of the

principal risks and uncertainties that Hyundai Motor Company faces.

Jaehoon Chang

CEO & President

April 28

, 2022

HYUN

DAI MOT

OR C

OMPAN

AND ITS SUBSIDIARIES

CONSOLIDATED

FINANCIAL STAT

EMENTS

AS OF AND FOR T

HE YEARS END

DECEMBER 31

, 2021 AND 20

ATT

ACHMENT: INDEPENDENT

AUDITORS’ RE

PORT

HYUN

DAI MOT

OR CO

MPANY

Contents

INDEPENDENT AUDITORS’ REPORT ---------------

--------------

--------

----------------

--------

--- 1

CONSOLIDATED FINANCIAL STAT

EMENTS

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION -----------------

------------

------

CONSOLIDATED STATEMENTS OF INCOME -----------------

--------------------

-----------------

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME ------------

--------------

CONSOLIDATED STATEMENTS OF CHANGES IN

EQUITY ---------------

-------------------

CONSOLIDATED STATEMENTS OF CASH FLOWS ------

------------

------------------

----------

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -------------------

--------------14

52,

eheran-ro, Gangnam-gu, Seoul 06236

eoksam-dong, G

angnam Finance Center

27th Floor)

Republic of Korea

Indep

endent Audit

ors’

Report

To the Boa

rd of Dir

ectors

and Shar

eholder

Hyundai Motor

Compa

ny:

Report on the Audit of the Consolida

ted Financial Statements

Opinion

We have aud

ited the c

onsol

idated financ

ial s

tatement

s of Hyunda

i Motor

Company

and its

subsid

iaries

(“the Group”), w

hich comp

rise the c

onsolida

ted stat

ements of

financial pos

ition

as of Dec

ember 31,

2021 and 2

020, the c

onsol

idated s

tatement

s of incom

e, compre

hensive

income,

changes

in equit

y an

cash f

lows for t

he year

s th

en ended, a

nd not

es, com

prising s

ignif

icant a

ccount

ing pol

icies an

d other

explana

tory inf

ormat

ion.

In our opin

ion, the a

ccompa

nying conso

lidated f

inanc

ial sta

tements pr

esent fairly

, in all ma

teria

respect

s, the cons

olidated

financ

ial posit

ion of th

e Group a

s of Decem

ber 3

1, 202

1 and 2020

, and it

consoli

dated fina

ncia

l perfor

mance a

nd its c

onsolid

ated ca

sh flows f

or the year

s then ende

d in

acc

ordance wit

h Korean I

ernationa

l Fina

ncial

Report

ing Sta

ndards (“K

-IFRS

”).

Basis for

Opinion

We conduc

ted our

audit

s in

accor

dance with K

orea

n Sta

ndards

on Audit

ing (KS

As). O

ur respons

ibilit

ies

under those s

tandar

ds are f

urther des

cribed in the

Auditors

’ Respons

ibilities

for the Aud

it of the

Consoli

dated Fina

ncial St

atement

s sec

tion of our

report

. We ar

e independ

ent of

the Gro

up in

acc

ordance wit

h the

ethica

l req

uirement

s that

are re

lev

ant to our

aud

it of th

e cons

olida

ted f

inancia

statemen

ts in

Republ

ic of Korea, an

d we have fulfill

ed our other ethi

cal responsibi

lities in accord

ance

with th

ese requir

ements

. We bel

ieve t

hat the a

udit

evidenc

e we ha

ve obtai

ned

is suff

icient a

appropria

te to

provide

a basis

for our op

inion.

Key Audit Ma

tters

Key audit

matt

ers ar

e those mat

ters tha

t, in o

ur profe

ssiona

l judgment

, wer

e of

most sign

ificanc

e in

our aud

it of th

e co

nsolidat

ed financ

ial st

atements

as of

and f

or the y

ear

ended

December

31, 202

These ma

tters

were addr

ess

ed in the

context

of our a

udit

of the

conso

lidated f

inancia

l sta

tements as

a whole, a

nd in f

orming

our opinio

n there

on, and

we do

not provi

de a separ

ate opin

ion o

n these ma

tters

Valuat

ion of warra

nty provisions

As descr

ibed in Not

e 2 (20)

and Note 1

7 to th

e conso

lidat

ed financial s

tatement

s, t

he Group rec

ognize

warra

nty prov

ision in the a

mount

୸

048,185 mi

llion a

s of Decem

ber 31, 20

21.

The Group pr

ovides c

ustomers

with free wa

rranty

servic

es for gua

ranteed per

iod and f

ree repa

servic

es in the

event of

recall a

nd ca

mpaign.

The Grou

p aggregat

es sales

volume

by v

ehicle mo

del an

estimat

es warra

nty expens

es whic

h are

expected

to b

e incur

red bas

ed on his

toric

al data

of the a

ctual

warra

nty cost

s. Warran

ty provisions

are meas

ured a

t the present

value bas

ed on the exp

ected

expendit

ure of wa

rrant

y cost

s and disc

ount r

ates. In or

der to mea

sure a

nd r

ecognize wa

rrant

provisions

, manag

ement appl

ies ass

umptions to es

timat

e expected war

ranty

cost per unit by

vehicle

model an

d expe

cted nu

mber of repai

r cases and applies d

iscount

rates to measure

the p

resent val

of provis

ions. Ma

nagemen

t uses

historic

al data

of the ac

tual wa

rrant

y costs

to estimate ex

pected

warranty cost p

er unit by ve

hicl

e model

and expe

cted nu

mber of re

pair cases. W

e determi

ned the

valuat

ion of warra

nty prov

ision as

a key a

udit matt

er becaus

e errors

in aggrega

tion of a

ctual wa

rranty

costs and sal

es volume by vehi

cle models or in assu

mptio

ns used to e

stimate future

warranty

expenses

and disc

ount rat

es woul

d have a s

ignific

ant im

pact on t

he conso

lidate

d financ

ial sta

tements.

The prima

ry proc

edures we

perform

ed to addr

ess this

key

audit mat

ter inclu

ded the fol

lowing:

Understa

nding of th

e proc

ess t

o measure a

nd recog

nize warr

anty pr

ovisions a

nd testin

g of

relevan

t contro

ls.

Testing of

compl

eteness a

nd ac

curac

y of vehic

les sol

d used f

or est

imation t

hrough

inspecti

of relat

ed docume

nts.

Evalua

ting reasona

blenes

s of as

sumptions

appli

ed for ex

pected

warrant

y cost

per un

it by

vehicle m

odel by c

ompari

ng warra

nty expens

es incurr

ed in the curr

ent perio

d t

o expected

warra

nty expens

es in the

prior per

iod.

Evalu

ating

reason

ableness of assu

mptio

ns appli

ed for expe

cted numbe

r of repai

r cases based

on hi

storical

data analysis.

Testing of a

ccura

cy of wa

rranty prov

ision bala

nce by in

spect

ing document

s relat

ed to his

torica

data of

the act

ual warr

anty expens

es on a s

ample ba

sis and t

esting

of reca

lculatio

Testing of

appropr

iatenes

s of dis

count ra

tes by c

ompar

ing to ext

ernal s

ources of

nformat

ion.

Valua

tion of

financia

l ser

vices

eceiva

bles

As descr

ibed

in Note

2.(8)

and Note

14 to

the c

onsoli

dated fi

nancial s

tatement

s, t

he Group

recog

nized

financia

l serv

ices rec

eivabl

es, net a

nd loss allowa

nce in t

he amount

୸

,029,132 m

illion a

୸

1,551,987 milli

on as of December 31, 2021, res

pectiv

ely.

The Grou

p reco

gnizes

allo

wance for

cre

dit loss

using

the ex

pect

ed cred

it los

s (ECL)

model

for f

inancia

servic

es rec

eivables

in ac

corda

nce with K

-IFRS 1

109 ‘fina

ncial i

nstr

uments’. Judgm

ent

of the

management

is r

equired

to det

ermine

wheth

er the

receiv

able ha

s ex

perienced

a s

ignific

ant

increas

e in

credit risk and other assumptions ap

plied to the ECL model, includin

g credit rating

and macroeconomic

variables. In addition, the G

roup us

es historical transacti

on data su

ch as delinquen

cy days, bankruptcy

and collec

tion in

determ

ining as

sumptions us

ed in t

he ECL mo

del. Si

nce the

impact

on the conso

lidated

financia

l stat

ements du

e to errors

in the a

ssumptio

ns appli

ed to t

he ECL mo

del is sign

ifica

nt, w

determi

ed that val

uation of finan

cial se

rvices re

ceivabl

es is a ke

y audit matter.

The prima

ry proc

edures we

perform

ed to addr

ess this

key

audit mat

ter inclu

ded the fol

lowing:

Assessing whether the Group’s acc

ounting policies comply with

the requirem

ents in K-IFRS

1109

‘Financial

nstrumen

ts’.

Understa

nding of the pr

oces

s over t

he measurement

of credit

loss allowanc

e on financia

serv

ices rec

eivables

and te

sting of r

eleva

nt controls.

On a sampl

e basis, assessi

ng the cred

it ratin

g and cl

assificati

on o

f credi

t quality i

ncluding the

identific

ation

of signif

icant

increa

se cr

edit risk,

through

inspect

ion of re

lated

docum

ents.

On a sam

ple basis

, chec

king t

he so

urce da

ta for

pro

babilit

y of def

ault

and l

oss giv

en defa

ult

and test

ing of ap

propriat

eness of

calcula

tion met

hods used f

or t

he estima

tion throu

recalcul

ation.

Other m

atter

The proc

edures

and pr

actic

es utilized

in th

e Re

public

of Korea

to a

udit s

uch

consoli

dated f

inancia

stat

ements ma

y differ f

rom those ge

neral

ly acc

epted and app

lied in ot

her count

rie

Responsibiliti

es of Managemen

t and Those Ch

arg

ed with Gove

rnance

for th

e Consolidated

Financial St

atemen

Manageme

nt is res

ponsibl

e for the pr

eparat

ion and fa

ir present

ation of t

he consoli

dated f

inancia

stat

ements in ac

cordanc

e with K

-IFRS, a

nd for

such int

erna

l control a

s mana

gement

determines

necessary to

enabl

e the preparati

on of consolidate

d finan

cial stateme

nts that are

free from materi

missta

tement, wheth

er due to f

raud or err

or.

In preparin

g the co

nsolida

ted financ

ial sta

tements,

management

is respo

nsibl

e for as

sessing t

Group’s ab

ility

to conti

nue as

a going co

ncern,

disclosi

ng, as

applic

able, ma

tters r

elated t

o goin

g concern

and usi

ng the

going c

oncer

n basis of

acc

ounting u

nless

management

either

int

ends to l

iquidat

e th

Group or to

ceas

e operatio

ns, or has

no rea

listic alter

nat

ive but to d

o so.

Those cha

rged

with gover

nanc

e are res

ponsibl

e for ov

erseein

g the Grou

p’s fi

nancia

l report

ing proc

ess.

Manageme

nt is res

ponsib

le for pr

esenting a

nd mar

king up t

he conso

lidated fi

nanc

ial st

atements

complianc

e with the r

equir

ements set

out in the Dele

gated Reg

ulati

on 2019/815

on Europea

n Sing

Electronic

Form

at (“ESE

F Regula

tion”).

Auditors’ Responsibilities

for

the Audit of the

Cons

olidated Financial

Statements

Our ob

jectives

are

to obta

in reas

onable a

ssura

nce abo

ut whet

her th

e cons

olidat

ed f

inancial

stat

ements

as a whole a

re free f

rom materia

l misstat

ement, wheth

er due to fr

aud or error

, and t

o issue an a

uditors’

report t

hat inclu

des o

ur opin

ion. R

easonable

ass

urance is

a high

level of a

ssur

ance, but is

not a

guarant

ee that an au

dit cond

ucted

in accordance

with KSAs will

always de

tect a material mi

sstatemen

when it ex

ists. Mis

stat

ements

can ar

ise from fra

ud or error

and are c

onsidered m

ateria

l if, indiv

idually

or in t

he aggrega

te, th

ey could r

easona

bly be

expected t

o infl

uence the

econo

mic decis

ions of

user

taken on t

he bas

is of thes

e consol

idated f

inancia

l stat

ements.

As part of an

audit in accordan

ce wi

th KSAs, we

exercise p

rofessi

onal jud

gment and

maintain

profess

ional skept

icis

m through

out the

audit.

We also

Identify and assess the

risks of

material misstatement of the

consolidated fina

ncial statements,

whether du

e to fra

ud or er

ror, des

ign an

d perfor

m audit pr

ocedur

es respo

nsive to

those ris

ks,

and obt

ain a

udit ev

idence

tha

t is suf

fici

ent and

approp

riat

e to prov

ide a

basis

for

our o

pinio

The risk of

not d

etecting

a mater

ial missta

tement res

ultin

g from fr

aud is

higher t

han for one

resultin

from err

or, as

fra

ud may inv

olve c

ollus

ion, forger

y, int

entio

nal omis

sions,

misrepres

entations

, or the override of inter

nal

contro

Obtain a

n underst

anding

of interna

l contro

l relevan

t to t

he audit in ord

er to des

ign audit

procedures

that a

re approp

riate in

the c

ircumsta

nces, but

not for

the pur

pose

of expr

essing an

opinion o

n the ef

fectiv

eness

of the Grou

p’s int

ernal

ontr

ol.

Evalua

te the

appropr

iaten

ess of

ccounting

pol

icies

used

the pr

epar

ation

of the

onsolidat

financia

l stat

ements and t

he rea

sonable

ness of a

ccounting

estima

tes and r

elated dis

closur

made by managem

ent.

Conclude

on the

appropr

iatenes

s of mana

gement’s

use of t

he going c

once

rn basis

account

ing and, ba

sed on t

he aud

it evidenc

e obta

ined, whet

her a ma

terial u

ncerta

inty exis

related t

o eve

nts

or cond

itions

tha

t may c

ast signif

icant

doubt

on the

Group’s

abi

lity

to cont

inue

as a going c

oncern

. If we c

onclude tha

t a ma

terial unc

ertaint

y exist

s, we are r

equired t

o draw

attent

ion in our

audit

ors’

report t

o the re

lated

dis

closures

in the c

onsol

idat

ed financia

stat

ements or, if

such d

iscl

osures a

re inadeq

uate, to

modify

our

opinion.

Our c

onclusio

ns ar

based on the a

udit ev

idenc

e obtained up to t

he dat

e of our a

uditors’ r

eport. Ho

wever, fut

ure

events or

conditio

ns may

caus

e the Group t

o cease t

o cont

inue as a

going

concern.

Evalua

te the over

all pres

enta

tion, struc

ture and

content

of the c

onsol

idated fi

nancia

stat

ements, inclu

ding the

disclos

ures, a

nd wheth

er the c

onsolida

ted fina

ncial

stat

ements

represe

nt the

underlyi

ng transactio

ns and e

vents i

n a manner that ach

ieve

s fair

presentation

Obta

in suffic

ient a

ppropria

te a

udit ev

idenc

e re

garding

the fi

nancia

l infor

mati

on of t

he entit

ies

or busi

ness ac

tivities

with

in the

Group t

o expr

ess a

n opin

ion o

n the c

onsoli

dated fina

ncia

stat

ements. We ar

e respons

ible for t

he direc

tion, s

upervis

ion and

performa

nce of t

he group

audit. W

e remain

solely

res

ponsible

for our a

udit

opin

ion.

We communic

ate wit

h those c

harged w

ith gover

nance rega

rding, am

ong oth

er mat

ters, t

he planned

scope a

nd tim

ing of t

he a

udit an

d sign

ificant

audit

findings

, incl

uding

any sig

nific

ant def

iciencies

intern

al control

that we identify duri

ng our audi

We also prov

ide those c

harged w

ith governa

nce with a

atement tha

t we hav

e complied with rel

evant

ethical r

equireme

nts rega

rding indepen

dence,

and communica

te with th

em all rela

tionships

and other

matter

s that

may rea

sonably be

thought

bear on

our in

depend

ence, a

nd whe

re appl

icable

, relat

safegua

rds.

From the matt

ers communic

ated with thos

e charge

d with g

overnanc

e, we deter

mine thos

e matters

that wer

e of most s

ignifica

nce in t

he audit

of the c

onsoli

dated fina

ncial st

atements

of the c

urrent per

iod

and are t

herefor

e the k

ey audit

matter

s. We d

escr

ibe these ma

tters in

our a

uditor

s’ report u

nless

law

or regulat

ion preclu

des pu

blic disc

losur

e about the ma

tter

or when, in ext

remely r

are cir

cumstanc

es,

we determ

ine that a ma

tter should not b

e communica

ted in our r

eport bec

ause the a

dverse

conseque

nces of do

ing s

o would r

easona

bly be

expec

ted to out

weigh th

e pub

lic inter

est be

nefits of

such commu

nication

Our res

ponsibil

ity is

to ass

ess whether t

he conso

lidate

d financia

l stat

ements hav

e been prepa

red in a

materia

l respects

with th

e requ

irements la

id dow

n in the E

SEF Reg

ulatio

Report on Other Legal and Regulatory Requireme

nts

We have chec

ked th

e complia

nce of

the conso

lidated f

inancial s

tatements

of t

he Group as

December 3

1, 2021 wit

h relev

ant requ

irement

s set out

in the ESEF

Regula

tion t

hat ar

e applica

ble to

financia

l stat

ements.

For the Gro

up it r

elates t

Consoli

dated fina

ncial s

tatement

s prepar

ed in a v

alid X

HTML f

ormat;

The XBR

L markup of t

he cons

olidated f

inanc

ial sta

tement

s usin

g the core

taxonomy

and th

common ru

les on ma

rkups s

pecified

in in t

he ESEF

Regulat

ion

In our o

pinion,

the

consolid

ated f

inancia

l sta

tements

of t

he Group

as at

Decem

ber 31,

2021,

ident

ified

as “9884

004RQX8P

RBXQ

8S60-2021

-12-31.z

ip”, hav

e been

prepared

, in al

l mat

erial respec

ts, in

compliance with the requirements laid down in the ESEF Regulation.

The engagement

partner on the audit resulting

in this independent auditors’ report

is Sang-Min Nam.

Seoul, Korea

March 8,

2022, except with respect to

the Report on Other Legal and Regulatory Requirements

section of our report above, as of April 22,

2022.

This rep

ort is ef

fectiv

e as of t

he audit rep

ort dat

e. Certai

n subsequ

ent events

or circ

umstanc

es, which

may occ

ur betwee

n the au

dit rep

ort da

te and t

he tim

e of read

ing this

repor

t, could

have a

materia

impact on t

he accompa

nying c

onsolidat

ed financ

ial sta

tements a

nd notes ther

eto. Ac

cordingly

, the

readers

of the au

dit re

port s

hould under

stand t

hat the

above aud

it rep

ort ha

s not

been upda

ted to

reflect t

he impac

t of suc

h subsequ

ent eve

nts or cir

cumsta

nces, if a

ny.

ڐٻ

HYUNDAI MOT

OR COMPANY

AND ITS S

UBSIDIARI

CONSO

LIDATE

D FINA

NCIAL STA

TEME

NTS

AS OF AND FOR THE YEARS EN

DED

DECEMBER 31,

2021 AND 2020

The accompanying conso

lidated fi

nancial statem

ents, including all footnote disclosures, were

prepared by, and are the

responsibility of, the Company.

Chang, Jae Hoon

Chief Execu

tive Offic

HYUNDAI MOTOR CO

MPANY

Main Office Address: (R

oad Name Addr

ess) 12, Heolleung-ro, Seocho-gu, Seoul

(Phone Number) 02-3464-111

ڑٻ

HYUNDAI MOTOR COMPANY AND ITS SU

BSIDIARIES

CONSOLIDATED STATEMENTS OF FINAN

CIAL POSITION

AS OF DECEMBER 31, 2021

AND DECEMBER 31, 2020

ASSETS

NOTES

December 31, 2021

December 31, 2020

(In millions of Korean Won)

Current assets:

Cash and cas

h equivalents

୸

12,795,554

୸

9,862,136

Short-term fi

nancial instrume

nts

6,949,333

7,219,695

Other financial

asset

5,20

12,396,646

12,897,108

Trade notes and accounts

receivable

3,20

3,147,296

3,283,972

Other receivables

4,20

4,220,970

4,016,972

Inventorie

11,645,641

11,333,734

Current tax as

sets

47,346

138,848

Financial services receivables

14,20

35,252,606

32,596,052

Non-current as

sets cl

assified as

held for sale

28,121

304,469

Other ass

ets

7,20

2,081,853

2,033,371

Total current as

sets

88,565,366

83,686,357

Non-current assets

Long-term fi

nancia

l inst

ruments

306,410

61,859

Other financial

asset

5,20

3,539,286

2,779,227

Long-term trade

notes and accounts recei

vable

3,20

137,157

124,269

Other receivables

4,20

741,168

702,341

Property, pl

ant and equi

pment

9,40

35,543,083

34,092,229

Investment pr

operty

10,40

156,656

160,967

Intangible as

sets

11,40

5,846,986

5,677,567

Investments

in joint ve

ntures a

nd associat

22,429,117

19,925,260

Net defined be

nefit ass

ets

219,721

Deferred tax ass

ets

2,224,833

2,847,454

Financial services receivables

14,20

45,776,526

37,069,158

Investments

in operat

ing lease

26,327,996

20,501,691

Right-of-us

e asset

940,826

836,324

Other ass

ets

7,20

1,191,284

879,509

Total non

-current as

sets

145,381,049

125,657,855

Total assets

୸

233,946,415

୸

209,344,212

(Continued)

ڒٻ

HYUNDAI MOTOR COMPANY AND ITS SU

BSIDIARIES

CONSOLIDATED STATEMENTS OF FINAN

CIAL POSITION

AS OF DECEMBER 31, 2021

AND DECEMBER 31, 2020

LIABILITIES AND EQUITY

NOTES

December 31, 2021

December 31, 2020

(In millions of Korean Won)

Current liabilities:

Trade notes and acco

unts payable

୸

9,155,255

୸

8,793,179

Other payables

20,39

6,335,645

6,123,714

Short-term b

orrowings

16,20,40

13,087,836

13,780,670

Current porti

on of long-term d

ebt and debentures

16,20,40

20,578,902

16,104,005

Income tax paya

ble

751,929

548,733

Provisi

ons

6,664,647

6,360,770

Other financial liabilities

18,20

55,187

100,328

Lease liabilities

12,20

167,266

141,478

Non-current liab

ilities classi

fied as held fo

r sale

214,066

Other liabilities

19,20,27

7,440,120

7,292,585

Total current liabilities

64,236,787

59,459,528

Non-current liab

ilities:

Long-term ot

her paya

bles

20,39

769,487

798,547

Debentures

16,20,40

63,458,809

48,795,361

Long-term debt

16,20,40

10,667,731

12,726,724

Net defined benefit liabilities

79,165

247,566

Provisi

ons

4,214,137

4,010,118

Other financial liabilities

18,20

87,258

459,507

Deferred tax liab

ilities

3,689,328

3,277,573

Lease liabilities

12,20

783,306

615,566

Other liabilities

19,20,27

3,344,618

2,612,752

Total non-current liabilities

87,093,839

73,543,714

Total liabilities

151,330,626

133,003,242

Equity:

Capital stock

1,488,993

Capital surp

lus

4,070,260

4,190,093

Other capital items

(1,968,385)

(1,700,592)

Accumulated ot

her comprehe

nsive loss

(1,772,601)

(3,409,661)

Retained earnings

73,167,855

68,911,800

Equity attrib

utable to the owners of the Comp

any

74,986,122

69,480,633

Non-con

trolling intere

sts

7,629,667

6,860,337

Total equity

82,615,789

76,340,970

Total liabilities and eq

uity

୸

233,946,415

୸

209,344,212

(Concluded)

See accompanying n

otes to the cons

olidated fi

nancial statements.

ړٻ

HYUNDAI MOTOR COMPANY AND ITS SU

BSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

FOR THE YEARS ENDED DECEMBE

R 31, 2021 AND 2020

NOTES

2021

2020

(In mill

ions of K

orean Won, e

xcept per share amo

unts)

Sales

27,40

୸

117,610,626

୸

103,997,601

Cost of

sales

95,680,131

85,515,931

Gross profi

21,930,495

18,481,670

Selli

ng and adminis

trative exp

enses

28,32

15,251,546

16,086,999

Operating p

rofit

6,678,949

2,394,671

Gain on investm

ents in joint ven

tures and

associates, net

1,303,365

162,162

Finance income

912,802

813,916

Finance expenses

548,410

955,991

Other income

1,447,261

1,308,642

Other expenses

31,32

1,834,405

1,630,144

Profit befor

e income

tax

7,959,562

2,093,256

Income tax expe

nse

2,266,485

168,703

Profit for the year

୸

5,693,077

୸

1,924,553

Profit attrib

utable to:

Owners of the C

ompany

4,942,356

1,424,436

Non-control

ling inte

rests

750,721

500,117

Earnings per share attr

ibutable to the owners

of the Compa

ny:

Basic earnings

per share:

Common stock

୸

18,979

୸

5,454

preferred stock

୸

19,002

୸

5,502

Diluted earnings

per share:

Common stock

୸

18,979

୸

5,454

preferred stock

୸

19,002

୸

5,502

See accompanying n

otes to the cons

olidated fi

nancial statements.

ڔٻ

HYUNDAI MOTOR COMPANY AND ITS SU

BSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHE

NSIVE INCOME

FOR THE YEARS ENDED DECEMBER 31, 2

021 AND 2020

2021

2020

(In millions

of Korean

Won)

Profit for the year

୸

5,693,077

୸

1,924,553

Other comprehens

ive income

(loss) :

Items that will no

t be reclassified sub

sequently to

profit or lo

ss:

Profit on fi

nancial assets measured at F

VOCI, net

102,137

29,222

Remeasurements

of defined benefit plans

175,392

39,564

Changes in retai

ned earnings

of equity

-accounted

investees, net

77,482

1,117

Changes in share of

OCI of equity-accounted

investees, net

21,803

53,248

376,814

123,151

Items that may be reclass

fied subs

equently to

profit or

loss:

Profit (los

s) on financi

al asse

ts measured at F

VOCI, net

(6,448)

4,959

Gain on val

uation of cas

h flow hedge

derivatives, net

5,015

100,077

Changes in share of

OCI of

equity-accounted

investees, net

546,504

(278,999)

Gain (loss

) on foreign operati

ons transl

ation, net

1,246,177

(971,213)

1,791,248

(1,145,176)

Total other c

mprehens

ive income (l

oss)

2,168,062

(1,022,025)

Total comprehensive in

come

୸

7,861,139

୸

902,528

Compreh

ensive income attributable to:

Owners of the C

ompany

6,938,637

395,224

Non-control

ling inte

rests

922,502

507,304

Total comprehensive in

come

୸

7,861,139

୸

902,528

See accompanying n

otes to the cons

olidated fi

nancial statements.

ڌڋٻ

HYUNDAI MOTOR COMPANY AND ITS SU

BSIDIARIES

CONSOLIDATED STATEMENTS OF CH

ANGES IN EQUITY

FOR THE YEARS ENDED DECEMBE

R 31, 2021 AND 2020

Capital

stock

Capital

sur

lus

Othe

capital

items

Accumulated

other

comprehensive

income

(

loss

)

Retained

earnin

Tota

l equi

attrib

uta

ble t

the owner

s of

the Com

Non-

contr

olling

interes

Total

uit

(

In mill

ions of K

orean Won

)

Balance

Janu

ary 1,

2020

୸

1,488,993

୸

4,197,015

୸

(1,516,817)

୸

(2,353,022)

୸

68,249,633

୸

70,065,802

୸

6,299,952

୸

76,365,754

Compr

ehe

nsiv

incom

Prof

it for the per

iod

1,424,436

500,117

1,924,553

Gain (

loss

) on

financia

assets

measur

ed at

FVOCI, ne

31,827

(5,560)

26,267

7,914

34,181

Gain on

valuatio

of cas

h fl

ow hedge

deriva

tives, net

90,265



90,265

9,812

100,077

Changes

in valu

ation

of eq

uity-accou

nted

inv

estee

s, n

(223,503)

1,118

(222,385)

(2,249)

(224,634)

Remeas

urements of

define

d benefit

plans



31,869

7,695

39,564

Loss on foreign

operat

ions

trans

lati

on, net

(955,228)



(955,228)

(15,985)

(971,213)

Tota

l compre

hensiv

incom

(1,056,639)

1,451,863

395,224

507,304

902,528

Tran

sactio

ns with

owner

s, re

corde

rectly in

equity

Payment o

f cash

divi

den

(790,489)

(103,290)

(893,779)

Increas

e in paid-

capital

subsi

diaries

issuin

g stock

(2,586)

239,519

236,933

Disposals of

inves

tment

subsidiaries

(67,662)

Purchase

s of

treas

ury st

ocks

(303,077)

Disposals of

treas

ury st

ocks

(2,183)

119,302

117,119

Othe

(2,153)

793

(1,360)

(15,486)

(16,846)

Tota

l tran

sactio

ns with

owners, rec

orded

direc

tly in

equity

(6,922)

(183,775)

(789,696)

(980,393)

53,081

(927,312)

Balance

Decem

ber 31, 202

୸

1,488,993

୸

4,190,093

୸

(1,700,592)

୸

(3,409,661)

୸

68,911,800

୸

69,480,633

୸

6,860,337

୸

76,340,970

(Continued)

ڌڌٻ

HYUNDAI MOTOR COMPANY AND ITS SU

BSIDIARIES

CONSOLIDATED STATEMENTS OF CH

ANGES IN EQUITY

FOR THE YEARS ENDED DECEMBER 31, 2

021 AND 2020

Capital

stock

Capital

sur

lus

Othe

capital

items

Accumulated

other

comprehensive

income

(

loss

)

Retained

earnin

Tota

l equi

attrib

uta

ble t

the owner

s of

the Com

Non-

contr

olling

interes

Total

uit

(

In mill

ions of K

orean Won

)

Balance

Janu

ary 1,

2021

୸

1,488,993

୸

4,190,093

୸

(1,700,592)

୸

(3,409,661)

୸

68,911,800

୸

69,480,633

୸

6,860,337

୸

76,340,970

Compr

ehe

nsiv

incom

Prof

it for the per

iod

4,942,356

750,721

5,693,077

Gain (

loss

) on

financia

assets

measur

ed at

FVOCI, ne

(21,021)

114,718

93,697

1,992

95,689

Gain (lo

ss) on va

luatio

of cas

h fl

ow hedge

deriva

tives, net

(47,902)

52,917

5,015

Changes

in valu

ation

of eq

uity-accou

nted

inv

estee

s, n

544,170

77,482

621,652

24,137

645,789

Remeas

urements of

define

d benefit

plans

167,021

8,371

175,392

Gain o

for

eig

operat

ions

trans

lati

on, net

1,161,813

84,364

1,246,177

Tota

l compre

hensiv

incom

1,637,060

5,301,577

6,938,637

922,502

7,861,139

Tran

sactio

ns with

owner

s, re

corde

rectly in

equity

Payment o

f cash

divi

den

- (1,045,775)

(1,045,775)

(140,854)

(1,186,629)

Increas

e in paid-

capital

subsi

diaries

issuin

g stock

19,819

165,311

185,130

Acquis

ition of

inves

tment

subsidiaries

(164,567)

65,966

(98,601)

Disposals of

inves

tment

subsidiaries

(71,634)

Purchase

s of

treas

ury st

ocks

(305,337)

Disposals of

treas

ury st

ocks

24,915

37,544

62,459

Repa

yment

hybri

d bonds

(150,323)

Othe

253

(21,638)

(21,385)

Tota

l tran

sactio

ns with

owners, rec

orded

direc

tly in

equity

(119,833)

(267,793)

(1,045,522)

(1,433,148)

(153,172)

(1,586,320)

Balance

Decem

ber 31, 202

୸

1,488,993

୸

4,070,260

୸

(1,968,385)

୸

(1,772,601)

୸

73,167,855

୸

74,986,122

୸

7,629,667

୸

82,615,789

(Concluded)

See accompanying n

otes to the cons

olidated fi

nancial statements.

ڌڍٻ

HYUNDAI MOTOR COMPANY AND ITS SU

BSIDIARIES

CONSOLIDATED STATEMENTS OF CA

SH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2

021 AND 2020

NOTES

2021

2020

n millions of Korean Won)

Cash flows fro

m operating activities:

Cash generate

d from operati

ons:

Profit for the year

୸

5,693,077

୸

1,924,553

Adjustment

15,777,589

16,808,385

Changes in operating ass

ets and liabilitie

(20,287,776)

(16,991,771)

1,182,890

1,741,167



Interest received

449,789

519,995

Interest paid

(1,905,945)

(2,008,084)

Dividend receive

213,735

234,432

Income tax paid

(1,116,885)

(897,317)

Net cash used in ope

rating activities

(1,176,416)

(409,807)

Cash flows f

rom inv

esting activities:

Changes in s

hort-term

financial

instrument

s, net

1,326,872

566,427

Changes in other

financial assets (curre

), net

225,974

(2,348,252)

Decrease in other fi

nancial assets (non-cu

rrent)

259,202

27,070

Collecti

on of other receivabl

67,437

37,388

Dispos

als of long-te

rm financi

al instruments

35,183

42,935

Proceeds from dis

posals of pr

operty, plant and

equipment

113,008

133,981

Proceeds from dis

posals of int

angible assets

20,261

3,823

Proceeds from dis

posals of inves

tment of

subsidi

aries

76,133

Proceeds from dis

posals of

vestment in joint

ventures and as

sociates

8,873

4,991

Acquisi

tions of s

ubsidiaries

, net of cas

h acquired

(294,210)

(50,313)

Increases in ot

her financial

assets

(non-current)

(212,964)

(148,896)

Increases in other

receivables

(69,563)

(25,077)

Purchases

of long-term fi

nancial ins

truments

(279,471)

(11,894)

Acquisi

tions of pro

perty, plant

and equipment

(4,304,334)

(4,687,842)

Acquisitions o

f intangible assets

(1,556,993)

(1,701,608)

Acquisit

ions of inves

tments i

n joint vent

ures and

associates

(565,528)

(1,359,278)

Others

43,674

102,816

Net cash used in in

vesting activities

(5,182,579)

(9,337,596)

(Continued)

ڌڎٻ

HYUNDAI MOTOR COMPANY AND ITS SU

BSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLO

FOR THE YEARS ENDED DECEMBER 31, 2

021 AND 2020

NOTES

2021

2020

(In

millions of Korean Won)

Cash flows fro

m financing activities:

Changes in s

hort-term

borrow

ings, net

୸

(620,051)

୸

301,587

Proceeds from long

-term debt and debentures

40,688,506

35,536,741

Proceeds from capital contrib

ution from non-

controlling i

nterest

165,311

5,080

Acquisi

tions of s

ubsidiari

(300,670)

Repayment of l

ong-term debt

and debentures

(29,164,478)

(23,059,360)

Repaymen

t of lease liabilities

(185,158)

(201,571)

Purchases of t

reasury stocks

(305,337)

(303,077)

Dividends pai

(1,186,800)

(893,769)

Repayment of

hybrid b

onds

(150,323)

Others

(148,714)

(33,158)

Net cash prov

ided by financing activities

8,792,286

11,352,473

Decrease due to transfer

to as

sets classified

as held for sale

(27,784)

Effect of exchange rate c

anges on cas

h and

cash equivalent

500,127

(397,121)

Net increase i

n cash and cash equi

valents

2,933,418

1,180,165

Cash and cas

h equivalents

, be

ginning of t

he year

9,862,136

8,681,971

Cash and cas

h equivalents,

end of t

he year

୸

12,795,554

୸

9,862,136

(Concluded)

See accompanying n

otes to the cons

olidated fi

nancial statements.

ڌڏٻ

HYUNDAI MOTOR COMPANY AND ITS SU

BSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2

021 AND 2020

1. GENERAL

Hyundai Mot

or Company (the

“Company” or “Parent Comp

any”) was incor

porated in D

ecember 1

967, unde

r the laws of

the Republic o

f Korea. The Company and

its s

ubsidiaries

(the “Group”) ma

nufacture and dis

tribute motor

vehicles and

parts, operate

vehicle financing and c

redit card processing, a

nd manufacture

trains.

The shares of the

Company ha

ve been listed on the Ko

rea Exchange since J

une 19

74, and t

he Global Depos

itary Receipt

issued by t

he Company ha

ve been listed on the L

ondon St

ock Excha

nge and Luxemb

ourg Stock Exchange.

As of December 31,

2021, the major shareholders

of the

mpany are Hyu

ndai MOBIS (45,78

2,023 shares,

21.43%) and

Mr. Chung, Mong

Koo (11,395,859

shares, 5.

33%).

(1)

The Group’s consolidated

subsidiaries as

of December 31, 2

021 are as foll

ows.

Name of subsidiarie

Nature of

business

Location

Ownership

ercenta

owners

hip

undai Ca

ital Services, Inc.

Financin

Korea

59.68

Hyundai C

ard C

o., Ltd. (

*1)

36.96

Hyunda

i Rotem

Compan

y (Hyundai

Rotem

)

(

)

Manufac

turing

33.77

Hyunda

i KEFICO C

orporation (

Hyundai

KEFICO)

100.00%

undai Pa

rtecs

Co., Lt

56.00%

undai N

ineerin

53.

66%

Maintrans Com

Services

100.0

undai Ro

tem 100.00%

Rotem SRS C

o., Ltd.

100.00%

Jeonb

uk H

undai

Motors

FC Co.,

Ltd.

Football cl

100.00%

AirPlu

Inc.

R&D and Sales

99.32%

undai M

otor Ame

rica

(

HMA

)

Sales

USA

100.00%

Hyundai Capita

l Amer

ica (HCA)

Financing

80.00%

HMA 80.

00%

Hyundai M

otor Manufac

turing

Alabama, L

(

HMMA

)

Manufac

turing

100.00%

HMA 100

.00%

undai Tr

anslead, Inc.

(

)

100.00%

Stamped

Metal American

Research

Technol

ogy, I

nc. (S

MARTI)

Holding c

ompany

72.

45%

HMA 72.

45%

Stamped

Metal American

Research

Technol

LLC

(

SMART

)

Manufac

turing

00.00

ARTI

100.00%

Hyundai

America Techni

cal Center,

Inc. (HATCI)

R&D

100.00%

Genesis Motor Ameri

ca LLC

Sales

100.00%

HMA

100.00%

undai Ro

tem USA Cor

oration

Manufac

turin

100.00%

undai Ro

tem 100.00%

Mocean

lab Inc.

Mobilit

service

100.00

superna

l, LLC(*

1,4)

R&D

44.44%

undai M

tor I

nves

tment, Inc

Investme

100.00%

undai A

uto Ca

nada

Cor

(

HACC

)

Sale

Canada

100.00%

HMA

100.00%

Hyunda

i Auto Ca

nada Capti

Insurance In

c. (HACCI)

Insurance

100.00%

undai Ca

ital C

anada I

nc.

(

HCCA

)

Financin

70.

00%

undai Ca

ital Services 20

.00%

undai Ca

ital Lease Inc.

(

HCLI

)

100.00%

HCCA 100

.00%

HK Lea

se Fundi

ng LP

100.00%

HCLI 99.99%

HCCA Fu

nding

Inc. 0.01

HCCA Fundin

Inc

100.00%

HCLI 100.0

HCCA Fundin

Two Inc.

100.00%

HCCA 100.00%

HK Retail Funding L

100.00%

HCCA

99.99

HCCA Fun

ding Two Inc

0.01

undai M

otor India

Limited

(

HMI

)

Manufacturi

India

100

.00%

Hyunda

i Motor

India En

gineering

Private Limited

(

HMIE

)

R&D

100.00%

HMI 10

0.00

ڌڐٻ

Name of subsidiarie

Nature of

business

Location

Ownership

ercenta

owners

hip

Hyundai I

ndia I

nsurance Bro

king Priva

Limited

(

HIIB

)

Insurance

100.00%

Hyundai Capita

l India

Private

Limited

(

HCI

)

Financi

100.00%

Hyundai C

apital

Services 100.

00%

undai M

otor J

an Co.,

Ltd.

(

HMJ

)

ales

100.00%

Hyunda

i Motor

Japa

n R&D C

ent

Inc. (HMJ R&D)

R&D

100.00%

Beijing Jing

xian Motor Safegua

Service Co., Ltd.

(

BJMSS

)

Sales

China

100.00%

Beijing Ji

ngxianronghua

Motor

Sale

Co., Ltd.

100.00%

BJMS

S 100.

00%

Gene

sis Motor Sales

(

Shan

hai

)

Co. Ltd.

100.0

Hyundai Mi

llennium (Be

ijing) Re

al Estate

Develo

ment C

o., Ltd.

Real estate

develo

ment

99.00%

CMEs 99.00%

Rotem Equipm

ents (Beijing)

Co., Ltd.

Sales

100.00%

Hyunda

i Rotem

100.0

KEFICO Automotive

Systems

(

Bei

Co.

, Ltd

Manufac

turing

100.0

Hyunda

i KEFICO

100.

00%

KEFICO Automotive

Systems

(

Chon

Co., Ltd.

90.00%

Hyunda

i KEFICO

90.0

Hyunda

i Truck &

Bus

(China

) Co., Ltd.

(

HTBC

)

100

.00%

HYUNDAI THANH CONG VIETNAM

AUTO MANUFACTURING

CORPORATION (HTMV)(*1)

Vietnam

50.00%

HYUNDAI THANH CONG

COMMERCIAL VEHICLE JOINT

STOCK COMPANY

(

HTCV

)(

)

Sales

50.00%

HYUNDAI THANH CONG VIET NAM

AUTO JOINT VENTURE JOINT

STOCK COMPANY

(

HTV

)(

)

50.00%

HYUNDAI KEFICO VIETNAM

COMPANY LIMITED

Manufac

turing

100.00%

Hyunda

i KEFICO

100.

00%

Hyunda

i Motor

Compa

ny Aus

tralia

Limite

(

HMCA

)

Sales

Australia

100.00%

HYUNDAI MOTOR PHILIPPINES. INC.

(HMPH)

Philippi

nes

99.

99%

PT. HYUNDAI MOTOR

MANUFACTURING INDONESIA

(

HMMI

)

Manufac

turing

Indones

99.99

PT HYUNDAI MOTORS INDONESIA

(

HMID

)

Sales

100.00%

HMMI 0.01

PT. HYUNDAI CAPITAL INDONESIA

(

HCID

)

Financi

100.

00%

Hyunda

i Capital

Services 100.

00%

Hyundai Capita

l Australia Pt

y Limited

Australia

100.00%

HR Mechani

cal Services L

imited

Serv

ices

New Zealand

100.00

undai Ro

tem 100.00%

Hyunda

i Motor

Manufa

cturin

g Cz

ech,

s.r.o.

(

HMMC

)

Manu

facturin

Czech

00.00%

Hyundai

Motor Czech s.r.o (HMCZ)

ales

100.00%

Hyunda

i Motor

Europe G

mbH (HME)

Marketing a

Sales

rmany

100.00%

Hyunda

i Motor

Deutsc

hland GmbH

(

HMD

)

Sales

100.00%

Hyunda

i Motor

Europe

Technical

Center GmbH

(

HMETC

)

R&D

100.00%

undai M

otor S

ort Gm

(

HMSG

)

Marke

tin

100.00%

HME 1

00.00

undai Ca

ital Eur

e G

mbH

Financi

100.00%

undai Ca

ital Servi

ces 100.00%

Hyunda

i Motor

Commonw

ealt

h of

Inde

endent States B.

(

HMCIS B.V

)

Holding c

ompany

Nether

lands

100.0

HMMR 1.

65%

Hyundai M

otor Nether

lands B.V.

(

HMNL

)

Sales

100.00%

Hyunda

i Motor

Manufa

cturin

g Rus

LLC

(

HMMR

)

Manufac

turing

Russi

70.

00%

Hyunda

i Motor

Commonw

ealt

h of

Inde

endent St

ates

(

HMCIS

)

Sales

100.00%

HMCIS

B.V 100.00

Hyundai M

obility La

b (HML)

R&D

100.00%

HMCIS 99.00%

, HMMR 1.00%

undai Ca

ital Se

rvices Lim

ited

Financi

100.00%

undai Ca

ital Eur

e 100.0

ڌڑٻ

Name of subsidiarie

Nature of

business

Location

Ownership

ercenta

owners

hip

Liabilit

Com

Hyunda

i Truc

k And B

us Rus LL

(HTBR)

Sales

100.00%

Hyunda

i Assa

n Otomo

tiv Sa

nayi

Ticaret A.S.

(

HAOSVT

)(

)

Manufac

turing

Tur

key

97.

00%

Hyundai EURotem Demiryo

lu Araclari

Sanayi

ve Ticaret A.S

50.50

Hyunda

i Rotem

50.50%

Hyunda

i Rotem

Company – H

yundai

EURotem Demiry

olu Araclari

SAN. VE TIC. A.S ORTAK GIRISIMI

Sales

100.00%

Hyunda

i Rote

m 65.00

Hyunda

i EURote

m A.S.

35.00

Hyunda

i Rotem

Company – H

yundai

EUrotem Ma

hmut

bey Proje

si OR

TAK

GIRISIMI

100.00%

Hyunda

i Rote

m 85.00

Hyunda

i EURote

m A.S.

15.00

Hyundai Rote

m Malaysia SDN B

Malaysia

100.00%

Hyunda

i Rotem

100.0

Rotem SRS Ukrai

ne LLC

Services

Ukraine

100.00%

Rotem SRS C

o., Ltd. 100.

00%

Rotem SRS E

gyp

t LLC

gyp

98.0

Rotem SRS Co., L

td. 98.0

undai M

otor UK Limite

(

HMUK

)

Sales

100.00%

Hyunda

i Motor

Compa

ny Italy S

.r.l

(HMCI)

Italy

100.0

undai M

otor Es

ana, S.L.U.

(

HMES

)

ain

100.00%

undai Mo

tor France S

(

HMF

)

France

0.00%

undai M

otor Po

land S

. Zo. O

(

HMP

)

Poland

100.0

nesis

Motor Europe

bh (G

ME)

Germany

100.00%

Gene

sis Motor UK Limited

(

GMU

)

100.00%

GME 100.

00%

Gene

sis Motor Switzerland

(

GMC

)

Switzerla

100

.00%

nesis

Motor Deuts

chlan

d Gm

(GMD)

German

100.

00%

undai H

dro

en Mobilit

(

HHM

)

Switzerland

75.00%

Hyundai M

otor DE Mexic

o S DE

DE CV

(

HMM

)

Mexico

100.00%

HT 0.

01%

Hyundai de

Mexic

o, SA D

E C.V

(

HYMEX

)

Manufac

turing

99.

99%

HT 99.9

HYUNDAI KEFICO MEXICO, S.

DE R.L. DE C.V.

xico

100.00%

Hyunda

i KEFICO

100.

00%

Hyunda

i Rio V

ista, I

nc.

Real estate

develo

ment

USA

100.0

HT 100.

00%

Hyunda

i Motor

Brasil M

ontadora de

Automoveis LTDA

(

HMB

)

Manufac

turi

Brazil

100.00%

Hyundai Capita

l Brasil Se

rvicos

Assistencia F

inancei

ra Ltda

Financi

100.00%

Hyunda

i Capital

Services 100.

00%

Hyundai Rote

m Brasil Industria

Comercio De Tre

ns Ltda.

Manufac

turing

100.00%

Hyunda

i Rotem

100.0

HMB Holding Partic

ipacoes

Finan

ceiras Ltda.

Holding c

ompany

99.99%

HMB 99.99%

China Millen

nium Corpora

tions (

CMEs)

Cayman

Islands

59.60

China Mobilit

y Fund, L.P.

Investment

72.00

KyoboAXA Private Tomo

rrow Securities

Investm

ent Tr

ust No.12

Korea

100.00%

Shinhan

BNPP Private Co

rporate

Securit

Inves

tment Tr

ust No.34

100.00%

KB Leaders Private Sec

urities

Fund1

(

Bond

ixe

)

100.00%

Samsung E

TF rotation Priva

te Inve

stment

Trust 1

100.00%

ZER01

NE Accelerator

Investm

ent Fun

d No.1

99.00

Autopia

Sixty-

Fourth ~ Se

venty-Sec

ond

Asset Securitiza

tion Specia

lty Co

mpany

(*1)

Financi

0.50%

Hyun

dai Capita

l Services 0.

50%

Zavurov F

irst Co., Ltd.

(

)

0.00%

undai Ca

ital Services 0

.00%

Super Serie

s Fifth ~ E

levent

Securitization

ecialt

Co., Ltd.

(

)

0.50%

Hyun

dai

ard

50%

Bluewa

lnut Co.,

Ltd.

100.00%

Hyunda

i Card

100.00%

MOCEAN Co., Ltd

Mobilit

Service

80.00%

ڌڒٻ

Name of subsidiarie

Nature of

business

Location

Ownership

ercenta

owners

hip

undai CH

A Fun

din

, LLC

Financi

USA

100.00%

HCA 100

.00%

undai Lea

se Titli

Trust

100.00%

Hyundai H

K Fun

ding, L

100.00%

undai HK

Fundin

Two, LLC

100.00%

undai HK

Fundin

Three, LLC

100.0

undai HK

Fundin

Four

, LLC

100.00%

Hyunda

i ABS Fu

nding, LLC

100.00%

HK Real Pro

erties, LLC

100.00%

undai Auto L

ease Offerin

, LLC

100.00%

undai HK Lease,

LLC

100.00%

Extended Term Am

ortizing

Program

, LLC

100.00%

Hyundai

Asset Backed Lease,

LLC

100.00%

HCA Exchan

e, LLC

100.00%

undai Pr

otection Plan, I

nc.

Insurance

100.00%

undai Pr

otection Plan Fl

orida, Inc.

100.00%

Hyundai C

apital

Insura

nce Servic

es, LLC

100.00%

undai Ca

ital Insurance Com

100.00%

Power Prot

ect Extend

ed Services, Inc.

100.00%

Power Pr

otect Extend

ed Services Flo

rida,

Inc.

100.00%

(*1)

The Gr

oup is c

onsider

ed to have

subs

tantive

control

over the

entiti

es by virtue of a

n agree

ment or re

lationship wi

th other

investors, or rela

tions

hip with str

uctured entities.

(*2)

Even t

hough t

e sha

reholdi

ng ratio of

ownership is

less than ha

lf, the Group

has de fact

o contro

l over the enti

ty due to t

relative

size

of the vo

ting rights

held a

nd the

degree

of s

hare dis

pers

ion of o

ther

voting

rights

holders.

(*3) For t

he year ended December 3

1, 2021, th

e Company’

s shareholding

ratio in Hyundai

Assan Otomo

tiv Sanayi Ve T

icaret A.S.

(HAOSVT), a sub

sidiary, changed from 70% to 97

%. As a result

, capital su

rplus and non-contro

ing interest have decreased

୸

4,567 m

illion an

୸

136,103

million,

respectively.

(*4) F

r the

year e

nded Dece

mber 31,

2021, the na

me of c

ompa

ny has

bee

chan

ged fr

om Genes

is Air Mo

bility L

LC to s

uper

nal,

LLC and the C

mpany’s sha

reholdin

g ratio chan

ged fr

om 100% to

44.44%. As a result, c

apital s

rplus and n

on-controlling

interest h

ave increased by

୸

19,8

19 mill

ion and

୸

107,55

9 million, r

espec

tively.

(2)

Sum

marized financial po

sition and results of ope

rations of major consolid

ated subsidiaries

and

for the year

ended December 31, 2

021 are as

follows.

Name of sub

sidiaries

Assets

Liabilities

Sales

Profit (l

oss)

for the period

(In million

s of Korean Won)

Hyundai Capital Serv

ices, Inc. (*)

୸

34,917,071

୸

29,710,340

୸

3,485,601

୸

432,055

Hyundai Card C

o., Ltd. (*

)

21,654,608

18,026,2

2,744,902

314,139

Hyundai Rot

em Compa

ny (*)

4,107,183

2,838

,938

2,872,512

51,412

Hyundai KEFIC

O Corporati

on (*)

2,038,940

1,187,748

2,029,003

60,512

HCA (*

)

59,230,3

52,672,107

10,686,865

1,050,25

HMA

8,578,53

5,929,58

22,883,1

1,028,470

HMMA

4,522,540

2,741,306

8,088,117

236,955

HMMC

4,406,392

1,852,526

7,426,329

417,537

HMI (*)

4,310,03

1,782,41

7,339,424

437,395

HME (*)

2,107,16

2,044,18

11,846,9

11,410

HACC (*

)

1,946,770

1,119,224

3,582,216

117,911

HMMR

1,931,470

959,020

3,178,717

172,149

HAOSVT

1,469,527

887,896

3,021,886

198,490

HMB

1,387,554

913,764

2,074,018

41,020

HMCA

911,712

716,694

1,938,967

28,116

(*)

Based on t

he subs

idiary’s

consolida

ted fi

nancial s

tatem

ents

ڌړٻ

mmarized financial p

osition and results o

f operations of major con

solidated subsidiaries

and for the year

ended December 31, 2

020 are as

follows.

Name of subsidiaries

Assets

Liabilities

Sales

Profit (l

oss)

for the period

(In millions of Korean Won)

Hyundai Capital Serv

ices, Inc. (*)

୸

33,683,340

୸

28,951,217

୸

3,245,441

୸

348,571

Hyundai Card C

o., Ltd. (*

)

19,941,856

16,500,531

2,526,137

244,561

Hyundai Rote

m Compa

ny (*)

4,197,374

2,851,222

2,785,326

22,409

Hyundai KEFIC

O Corporati

on (*)

2,007,029

1,246,934

1,880,84

120,461

HCA (*

)

45,365,985

40,336,417

11,298,2

514,792

HMA

6,923,939

5,483,741

19,633,057

300,129

HMMA

4,735,474

3,326,009

6,994,74

(1,019,072)

HMMC

4,012,518

1,717,572

5,817,25

162,669

HMI(*)

3,903,535

1,764,081

5,782,305

221,246

HME (*)

2,416,136

2,364,634

9,215,87

14,185

HMMR

1,676,120

941,181

2,829,969

93,12

HACC (*

)

1,543,844

895,215

2,998,41

64,167

HAOSVT

1,47

2,674

968,587

2,468,37

56,050

HMB

1,159,635

964,698

1,472,328

(47,253)

HMCA

818,850

656,270

1,415,987

11,686

(*)

Based on

the subsidi

ary’s consolidated finan

cial statement

(3)

The financial statements of all s

ubs

idiaries used in the preparation of the consolid

ated financial

statements

are prepared for the s

ame repo

rting periods as

the Company’

(4)

Summarized cash flows o

f non-wholl

y owned subs

idiaries

that have mate

rial non

-control

ling interes

ts to the

Group and subs

idiaries of fina

nce segment for the year ende

d December 31,

2021 are as fo

llows.

Description

Hyundai Capi

tal

Services, Inc

Hyundai Card C

o.,

Ltd.

HCA

HCCA

Hyundai

Rotem

Comp

any

(In millions of Korean Won)

Provided

by (used i

operating

activities

୸

(367,733

)

୸

(1,400,073)

୸

(7,321,554)

୸

(1,558,760)

୸

(62,714)

Provided by (us

ed in)

investing activities

(40,360)

(

105,567

)

(955,140)

(642)

146,142

Provided

by (used i

financing activities

510,8

1,310,731

8,132,339

1,549,724

(99,586)

Effect of exchange rate

changes on cas

h and

cash

equi

valent

339

37,398

6,651

(2,842)

Net increase (decrease) in

cash and cash

equivalents

103,105

(194,909)

(106,957)

(3,027)

(19,000)

Beginni

ng balance of

cash and cash

equivalents

406,065

774,353

475,148

75,429

338,7

Ending balance o

f cash

and cash equival

ents

୸

509,170

୸

579,444

୸

368,191

୸

72,402

୸

319,728

ڌڔٻ

Summarized cash flows of no

n-wholly owned subsi

diaries t

hat had material non-cont

rolli

ng interest

s to the

Group

and subsidiari

es of fi

nance segment for

the year ended December 3

1, 2020 are as

follows.

Description

Hyundai Capi

tal

Services, Inc

Hyundai Card C

o.,

Ltd.

HCA

HCCA

Hyundai

Rotem

Comp

any

(In millions of Korean Won)

Provided

by (used i

operating

activities

୸

(734,919

)

୸

(2,110,922)

୸

(5,671,707)

୸

(736,550

)

୸

56,423

Used in

investing

activities

(349,375)

(81,458)

(99,608)

(1,291)

(75,057)

Provided

by (used i

financing

activities

1,139,27

2,236

,920

6,134,190

760,770

(21,649)

Effect of exchange rate

changes on cas

h and

cash

equivalent

(273)

(37,326)

(2,767)

(3,475)

Net increase (decrease) in

cash and cash

equivalents

54,980

44,267

325,549

20,162

(43,758)

Beginni

ng balance of

cash and cash

equivalents

351,085

730,086

149,599

55,267

382,486

Ending balance o

f cash

and cash equival

ents

୸

406,065

୸

774,353

୸

475,148

୸

75,429

୸

338,728

(5)

Details of non-wh

olly owned

subsidiaries of the C

omp

any that have material

non-c

ontrolling interests as

and for the year en

ded December 31

, 2021 are as

follows.

Description

Hyundai Capi

tal

Services, Inc.

Hyundai Card C

o.,

Ltd.

Hyundai Rote

Comp

any

(In millions of Korean Won)

Ownership p

ercentage of

non-controlling

interes

40.32%

63.04%

66.23%

Accumulated non

-controlling interests

୸

2,097,956

ஶ

2,379,871

ஶ

702,366

Profit attrib

utable to non-con

trolling

interest

170,930

198,059

28,968

Dividends pai

d to no

n-control

ling interests

37,002

92,463

Details

of non-wholly owned

subsidia

ries of the Compan

y that had material

non-contr

olling inte

rests as

of and for

the year ended December 3

1, 2020 are as

follows.

Description

Hyundai Capi

tal

Services, Inc.

Hyundai Card

Co., Ltd.

Hyundai Rote

Comp

any

(In millions of Korean Won

)

Ownership p

ercentage of

non-controlling

interes

40.32%

63.04%

66.23%

Accumulated non

-controlling interests

୸

1,912,151

୸

2,267,168

୸

808,494

Profit attrib

utable to non-con

trolling

interest

139,223

154,171

13,51

Dividends pai

d to no

n-control

ling interests

36,081

63,429

3,733

(6) Financial

support

provided

consolidated structure

entities

As of December 31, 2021, Hy

undai Card Co., Lt

d. and Hyun

ai Capital Services, Inc., s

ubsidiaries of the C

ompany,

have agreements t

hat provide

counterparties

with right

s of re

course in the event

of default

on the deri

vatives relat

ing

asset-backed securities issu

ed by consolidated stru

ctu

red entities, Autopia Sixty-

Eighth and Sixty-Ninth Asset

Securitization Sp

ecialty Company, Su

per Series Fifth, Sixth,

Eighth and Ninth Securitization Sp

ecialty Co., Ltd..

ڍڋٻ

(7)

Nature and

risks associated with

interests in un

consolidated structured

entities

Nature of interests in unconso

lidated structured entities of the Group as of D

ecember

31, 2021 is as follows.

Descript

ion

Purpose

Nature of busines

Method of

funding

Total assets (*)

(In millions of Korean Won)

Asset

securitization

SPC

Fund

raising

through as

set-

securitization

Fund

collection

Asset

Backed

Securities and

others

୸

138,514

Investment fu

Investment trust an

others

Fund

mana

gement

and operation,

distri

bution of

operating profi

and others

Beneficiary

(Investment)

certificates

9,874,54

Structured Fi

nance

Fund raising

through pr

oject

financing

Project

nancing

for construct

ion

project and

ship invest

ment

Project

financing

and others

19,487,943

(*) The financial

informati

on of unc

onsolidated struct

ured entity includes una

udited amounts

Nature of interests in unco

nsolidated structured entiti

es of the Group as of Decem

ber 31, 2020 is as follows.

Descript

ion

Purpose

Nature of busines

Method of

funding

Total assets (*)

(In millions of Korean Won)

Asset

securitization

SPC

Fund raisi

through as

set-

securitization

Fund

collection

Asset

Backed

Securities and

others

୸

3,111,224

Investment fu

Investment trus

t and

others

Fund

mana

gement

and operation,

distri

bution of

operating profi

and others

Beneficiary

(Investment)

certificates

13,199,533

Structured Fi

nance

Fund raisi

through pr

oject

financing

Project financi

for construct

ion

project and

ship invest

ment

Project

financing

and others

8,900,65

(*) The financial

informati

on of unc

onsolidated struct

ured entity includes una

udited amounts

Risks a

ssociated with interests

in an unconsolidated structur

ed entity of the Group as of

December 31, 2021 are as

follows.

Description

Financial

support

provided

to the structu

red entity

Maximum amount

of exposure to l

oss

of the structured

entity

Book value in

the

structured

entity

Metho

rpose

(In millions of Korean Won

)

Asset

securitization

SPC

୸

18,797

Loan

obligation

Loan

reement

(Credit line)

୸

24,000

Investment fu

178,552

Beneficiary

certificates,

Investment tr

ust

Invest

agreement

178,552

Structured Fi

nance

826,220

Loan

obligation

Loan

reement

(Credit li

ne)

1,117,599

ڍڌٻ

Risks associated

with interests in an

unconsolidated structur

ed entity of the Group as of December 31, 2020

are as

follows.

Description

Financial

support

provided

to the structu

red entity

Maximum amount

of exposure to l

oss

of the structured

entity

Book value in

the

structured

entity

Method

rpose

(In millions of Korean Won

)

Asset

securitization

SPC

୸

13,909

Loan

obligation

Loan

reement

(Credit line)

୸

31,000

Investment fu

300,384

Beneficiary

certificates,

Investment tr

ust

Invest

agreement

300,384

Structured Fi

nance

429,519

Loan

obligation

Loan

reement

(Credit li

ne)

682,514

(8) Significant restr

ictions on the subsidiar

ies

As of December 3

1, 2021, H

yundai Ca

rd Co., Ltd., s

ubsidiar

y of the Company, has s

ignific

ant restri

ctions that

require

it to obtain consent from nominated outside directo

r recommended by non-controlling shareho

lders in the event of

acquiring a com

pany, entry

int

o new business

, guarantee, i

nves

tment in st

ocks or cont

racts

beyond a certain a

mount

and others

(9) Changes i

n consolidated

subsidiari

Subsidiari

es newly included i

n or excluded from cons

olidati

on for the ye

ar ended December 31,

2021 are as follows

Changes

Name of subsi

diaries

Description

Included

Rotem SRS C

o., Ltd.

Establishment

Hyunda

i Motor

Inves

tment, I

nc.

nesis

Motor Deuts

chlan

d Gm

bH (G

MD)

HYUNDAI MOTOR PHILIPPINES. INC.

(HMPH)

Hyundai I

ndia I

suranc

e Brokin

g Priva

te Limite

d (HIIB)

Autopia Se

venty-Firs

t Ass

et S

ecuritiz

ation Specialty

Company

Autopi

a Seven

ty-Second

Asset Securitizat

ion Sp

ecialty Comp

any

Super Serie

s Tenth Se

curitizatio

n Specia

lty Co.,

Ltd

Super Series El

eventh Secu

ritization

Specialty Co.

, Ltd

Rotem SRS Ukrai

ne LLC

Rotem SRS Egy

pt LLC

HYUNDAI THANH CONG VIET NAM

AUTO JOINT VENTURE JOINT

STOCK COMPANY (HTV)

Acquisition

AirPlug Inc.

Excluded

Hyunda

i Autron

Company Lt

Liquidation

Autopia Sixty

-Third Asset Securitization Specialty Comp

any

Hyd

rogen

ic Ener

gy Fund

1,L.

Changed to e

quity

method

ڍڍٻ

SUM

MARY OF SIGNIFICANT ACCOUNT

ING POLICIES:

(1)

Basis of consolidated

financial statements

preparation

The consolidated financial s

tatements ha

ve been pre

pared in accordance with

Korea

n International Financial Reportin

Standards (“K-IFRS”), as p

rescribed in the Act on External Audit of

Stock Companies, Etc in the Repub

lic of Korea.

The significant accounting

olicies used for the preparatio

n of the cons

olidated financial statements are s

ummarized

below. These accounting po

licies are consistent with those applied to the consolidated financial statements for the year

ended December

31, 202

0, except for the

adoption

effect of the

new accounti

ng standar

ds and interpretat

ions descri

bed

below.

New and revised standar

ds that have been appl

ied fro

m the year begin

ning on January 1

, 2021 are

as follows

The Group appli

ed Phas

e 2 of

Inter

est Rate Benchmark Refo

(Amendments

to K-IFRS

1109

‘Financi

al Instruments

’

K-IFRS

1039

‘Financial I

nstruments: Recognit

ion and M

easur

ement’

, K-IFRS 1107

‘Financial I

nstruments:

Disclosure

s’

, ‘K-IFRS 1104

‘Ins

urance Contr

acts’

and K-IF

RS 1116

‘Lea

ses’

) and

Covid-19-Related

Rent

Concess

ions

(Amendments

to K-IF

RS 1116

‘Leases’

) for the firs

time on Ja

nuary 1, 20

21. These standards and

other

new accounting s

tandards

effecti

ve from January

1, 2021 do

not have

a material impact

on t

he Group's

consolidated

financial statements.

2) A number of

new standards

are effective for annual period

beginning aft

er Januar

y 1, 2021 and earl

ier a

pplication i

permitted; ho

wever, the Group has not early adopted them in preparing these consolidated finan

cial statements.

The Group is

currently eval

uating t

he effect of the f

ollowing

new or amended st

andards an

d interpretati

ons, if a

ny, to the

consolidated fina

ncial statements, however,

those standards are not

expected to

have a s

ignificant

impact on the Gr

oup’s

consolidated financial s

tatements.

- Proceeds before I

tended Us

e (K-IFRS 1016 ‘

operty, Pl

ant and Eq

uipment

’)

- References to C

onceptual Fr

amework (K-IFR

S 1103 '

Business

Combinati

ons

’)

- Classi

fication of Liabilities as

Current or Non-cur

rent (K-IFRS 1001

‘Presentati

on of Fi

nancial St

atements’



- K-IFRS

1117

‘Insur

ance Contr

cts’

and it

s amendment

- Cost of F

ulfilli

ng a Contract

(K-IFRS

1037 ‘

Provisions, Co

ntingent Liab

ilities and Contingent Assets

’)

- Deferred Tax related to As

sets and Liabilities

arising from a Single Trans

action (K-IFRS 1012

‘

Income Taxes

’)

- K-IFRS

Annual Impr

ovements

2018-202

- Discl

osure of Accounti

ng pol

icies (K-IF

RS 1001 ‘

esentation of

Financial St

atements’

)

- Definition of Accounting est

imate (K-IFRS 1008 ‘

Accounti

ng Policies

, Changes i

n Account

ing Esti

mates and

Error

’)

- COVID-19-R

elated R

ent Concessions beyond

30 June 2021 (Amend

ment to IFRS 16

‘Leases’

)

The consolidated

financial s

tatements

were approved

by the

Board of Directo

rs on January 25, 2

022 and a

expected to be s

ubmitted

for the C

ompany's annual

general

meeting of sha

reholders.

(2)

Basis of measurement

The consolidated

financial st

atements have

been

prepared

on the historical cost bas

is except as

otherwis

e stated in the

accounting pol

icies bel

ow. Histori

cal cost is

usually meas

ured at the fair value

of the cons

ideration give

n to acquire t

assets.

(3)

Basis of consoli

dations

The consolidated financial statements in

corporate the financial statements of the Company and entities (

including

structured en

tities) controlled by the Co

mpany (or its subs

idiaries). Control is achiev

ed when the Company:

has power over

the investee;

is exposed, or has

rights, t

o vari

able returns f

rom its i

nvolvement

with the inves

tee; and

has the ab

ility to use its power to af

fect its returns.

The Group reasses

ses whether or not it controls

an invest

ee if

facts and circumstances

indicate that there are changes

one or more

of the three eleme

nts of control lis

ted above

ڍڎٻ

When the Group has less th

an a majority of the voting rights of an investee, it has po

wer over the investee when the voting

rights are suf

ficient to give it the pr

actical ability to dire

ct the relevant activities of

the investee unilaterally

. The Gro

considers all

relevant facts an

d circumst

ances in ass

essing whether or

not the Group’s

voting ri

ghts in a

n investee are

sufficient

to give it

power, including:

the size of the Group’s

holding of voting

rights relative to t

he size and dispersion

of holdings of the ot

her vote

holders;

potential voti

ng rights

held by

the Group, other vote

holders or othe

r parties

;

rights arisi

ng from othe

r contr

actual arrangements; and

any additional facts

and circu

mstances that

indicate that the

Group has, or does not

have, t

he current abili

ty to

direct the relev

ant activities at the time that decision

s need to be made, including

voting patterns at previou

shareholders’ meetings

Income and expens

es of subsidiari

es acquired or di

sposed

of durin

g the period are i

ncluded in the consolidated

statement

of comprehensive i

ncome from the effecti

ve date of acquis

ition and up to the e

ffective date of dispos

al, as appropriat

When necessary, adjus

tments are made to

the financial statements of subs

idiaries

to bring their accounting policies into

line with thos

e used by t

he Gr

oup. All

intragroup

transactio

ns, balances, income and exp

enses

are eliminated in full on

consolidati

on.

Non-controlling in

terests are presen

ted in the consolidated statemen

t of financial position

within equity,

separately f

rom the equity of the owners of th

e Group. The carrying amount of non-controllin

g interests con

sists of the

amount of

those non-c

ntrolling interest

at the

initial recognition

and

the chan

ges in shares

of the non-c

ontrolling

interests in equ

ity since the da

te of the acq

uisition. Total co

mprehensive in

come is attributed to

the owners of

the Group

and to the non-co

ntrolling interests even

if the non-contro

lling interest has a d

eficit balance.

Changes in the

Group's own

ership interests

in subs

idiaries

, without a

loss of cont

rol, are acc

ounted for as

equity

transactions. The carryin

g amounts of the Group'

s interests and the n

on-controlling inte

rests

are adjusted to reflect the

changes in th

eir relative interests in the subsid

iaries. Any difference between th

e amount by which the non-controllin

interests are adjust

ed and the fa

ir value of the cons

ideration paid or

received is reco

gnized directly in

equity

and attributed

to owners of

the Group.

When the G

roup loses

control

of a subsi

diary, t

he profi

t or

loss

on disp

osal is

calculated

as the di

fference

between (i)

the

aggregate of the fair value of the consideration received and the fair value of any retained interest and (ii) the previous

carrying amount of the assets

(including g

oodwill), lia

bilities of the subsidiary and any non-c

ontrolling interests

. The

amounts previously

recognized in

other

comprehensive inc

ome and accumulated in

equity are accounted

for as if

the

Group had direct

ly disposed

of the relevant assets

(i.e., reclassi

fied to profit or l

oss or trans

ferred directly t

o retaine

earnings as s

pecified by appli

cable K-IFR

S). The fair value of any inves

tment retaine

d in the former subsidiary at t

date when control

is lost

is regarded as the fai

r value

n initial

recognition

for subs

equent account

ing unde

r K-IFRS 1109

Financial Instr

uments: Recognition and Meas

urement

r, when applicable, the cost on initial recognition of an investment

in an associate or

a jointly controlled entity

(4) Bus

iness

combi

nation

Acquisit

ions of b

usiness

es are accounte

d for using

the acquisit

ion method.

The consi

deration t

ransferred i

n a bus

iness

combinatio

n is measured at fair value, which is calculated as

the sum of the acquisition-

date fair values of th

e assets

transferred by the G

roup, liab

iliti

es incurred by the Gr

oup to the for

mer owners of the acquiree and

the equity interests

issued by the Group in exchange for con

trol of the acquiree. T

he consideration includes any asset or liability

resulting

from a continge

nt consideration arrangement

and is

measured at fai

r value.

Acquisition-related costs

are recognized in

profit or l

ss as in

curre

. When a

business com

ina

tion is achieved

in stages

the Group's previous

ly held equity

interest in the acquiree i

s re

measured at its fair value at

the acquisition date (i.e., the

date when t

he Grou

p obtains

control

) and t

he resul

ting gain

or loss, if

any, is

recognized

in pr

ofit or loss

. Prior

to th

acquisition date, the amount res

ulting from chan

ges in the value of its

quity interest in the acqui

ree that have previously

been recognized

in other c

omprehensive income a

re reclass

ified to profit

or loss

where such t

reatment woul

d be

appropriate if t

hat interest w

ere directl

y disposed

of.

(5)

Revenue

recognitio

In accordance with K-IFR

S 1115, all types

of cont

racts re

ognize revenues

by the 5-step re

venue

recognition model (1)

identification

of contract

಺

(2) identification of pe

rformance obligations

಺

(3) calculat

ion of transacti

on price

಺

(4)

ڍڏٻ

allocation of t

ransaction price t

o performance

obligatio

಺

(5)

recognition o

f revenue when performa

nce obligation is

implemented.

1) Identifi

cation o

f performa

nce obligati

ons

The Group operates

businesses such as the

manufacture and

sale

of automobiles and auto parts. In the automobile sales

contracts with customers, s

ervices othe

r than automobile sales are sep

arately identified

as performance obligations.

2) Performan

ce obligations satisfied at a po

int in time

Revenue is reco

gnized when

obligations

under t

he terms o

f a contract wi

th the Gro

up’s cus

tomer are s

atisfied, w

hich

generally occurs

with the tra

nsfer of control of

goods or s

ervices

3) Performance obligation

s satisfied over time

In asses

sing whether the contr

ol over goods or s

ervices is

transferred over ti

me, the Group evaluat

es whether the cus

tomer

simulta

neously obtains

and consumes

the benefits provi

ded by the Group’s performance, w

hether the assets are cont

rolled

by the customer, and whether the assets created by the Group ha

no substitute purpo

se, and whether the Group is entitled

to reimbursement

of costs

incurred to date, including

a reasonabl

e margin.

4) Allocation o

f transacti

on pri

The Group allocates the transaction price

to each of the performance obligatio

identified in a s

ingle contract in

proportion t

o its stand-alone

selling pri

ce. When the st

and-al

one selling p

rice is not direct

ly observable,

the Grou

estimates the stand-alone

selling price using

the adj

usted ma

rket assess

ment approach

or t

he expected c

ost plus a

margin

approach.

5) Variable consideration

The Group estimates

the amounts of consideration using w

hichever metho

d (the expected va

lue or the most likely amount)

that best pred

ict the amount of consideration to which

it will be entitled.

Variable consi

deration is i

ncluded in the

transacti

on price on

ly to the exte

nt that it i

s probabl

e or highly

probable that a

significant reversal in the

cumulative amount of

reve

nue rec

ognized will not occur in the

future periods

6) Significant

financing

element

If the period betw

een the transfer of the go

ods or servi

ces promis

ed to the customer and t

he payment fr

om the custome

is wit

hin one year, the Gro

up d

oes not adjust

the promis

ed am

ount of consi

deration f

or the ef

fects of a s

ignificant

financing

component, as a practical exp

edient.

7) Construct

ion cont

racts

Where the outcome

of a construction co

ntract ca

n be est

imated reliably,

the contract reve

nue and

contract cos

ts ass

ociated

with the construction cont

ract are reco

gnized as revenue

and expenses, res

pectively, by refere

nce to the st

age of

completion

of the contract

activi

ty at the end of

reporting peri

od.

The percentage o

f completi

on of a c

ontract activi

ty is reli

ably

measured bas

ed on the

proport

ion of contract

cost

s incurred

for work perfor

med to date rel

ative to the es

timated total

contract costs, by s

urveys of work performed or by co

mpletio

of a physical

proport

ion of the

contract work. Variat

ions in

contract wor

, claim a

nd ince

ntive payments

are included

the extent that the amount ca

n be measured reliably and it

s receipt is considered proba

ble. Where the outcome o

f a

construction co

ntract cannot b

e estimated reliably, contract r

evenue is recognized to the ex

tent of contr

act costs

incurred

that it is probable will be recoverable.

Contract c

sts are recognized as

expenses in

the per

iod in which they are inc

urred.

When it is probable that total contract

costs will exceed total contract revenue,

the expected loss

is recognized as an

expense immediately.

(6)

Foreign curre

ncy translation

The individual financial st

ements of each e

ntity in the Group are pre

ed and pres

ented in the currenc

y of the

primary economic en

vironment in which the entity oper

ates (its function

al currency).

ڍڐٻ

In preparin

g the financi

al sta

tements of the indivi

dual ent

ties, transacti

ons occurring i

currencies other than their

functional currency (fo

reign currencies) are

rec

orded using t

he exchange rate on the dates

of the transactions

. At the end

of each reporting peri

od, monetary items denominated in f

oreign

cur

rencies are translated

usi

ng the exchange

rate at the

reporting pe

riod. Non-monet

ary items that are meas

ured i

n te

rms

of historical c

st in a

foreign curre

ncy are trans

lated

using the excha

nge rate at the

date of the transact

ion. Non-monet

ary items that are meas

ured at fair value in a forei

currency are

translated us

ing the excha

nge

rates at the

date when the fair value was determined. Exchange differences

resulting

from settlement of assets or liab

ilities and translati

n of monetary items denominated in foreign currencies are

recognized in p

rofit or los

s in t

he period in which t

hey arise except for s

ome exceptions

Foreign exchange gains or loss

es are clas

sifi

ed in finance income (expenses

) or other income (expens

es) by the nature of

the transaction or event.

For the purpose of presentin

g the consolidated financial statements, assets and liab

ilities in the Group’s foreign operations

are translated i

nto Won, us

ing the excha

nge rates at t

he end

of rep

rting pe

riod. Income an

d expense items are

translate

at the average

exchange rate for t

he period, unless

the exchange rate

during t

he peri

od has s

ignificantl

y fluctuated,

which case the exchange rates

at the dates

of the transactions are used. The exch

ange differences aris

ing, if any, are

recognized in e

quity as

other

comprehensive income. U

pon the di

sposal of a

foreign operation, t

he cum

ulative amoun

of the exchange differences relating to th

at foreign operation is reclassified from equity to profit or loss when the gain or

loss on

dispos

al is reco

gnized.

Any go

odwill aris

ing o

n the ac

quisiti

on of

a foreign ope

ration and any fai

r val

adjustments to the carryin

g amounts of ass

ts and liabilities arising on the acquisiti

on of that foreign

operation are treate

as assets and liabilities o

f the foreign operation an

d translated at the exchange rate at the end o

f reporting period.

(7)

Financial Assets

The Group classi

fies financial assets as

financial assets meas

ured at fair value through profit or loss, financial assets

measured at amortized cost

or financia

l ass

ets measured at fair value thr

oug

h other comprehens

ive income accordi

ng to

the terms and purp

ose of acqu

isition. The Group determi

es th

e classification of a fina

ncial asset at initial recognition.

All recognize

d financi

al asset

s are meas

ured subsequent

ly in

their ent

irety at either am

ortize

d cost

or fair

value, depe

nding

on the classification of t

he financial assets

Clas

sification of

financial assets

Debt inst

ruments that meet

the foll

owing condi

tions are

meas

ured subsequentl

y at amortiz

ed cost:

The financial asset is held within

a business model w

hose objective is to

hold financial assets in order

collect contractual cash flows

; and

The contract

ual terms of the fi

nancial asset give ris

e on speci

fied dates to cas

h flows that

are solel

y payments

of principal

and interes

t on the

principal amount

outs

tanding.

Debt inst

ruments that meet

the following con

itions

are measured subs

equently at

fair value t

hrough other com

prehensive

income (FVOCI):

The financi

al asse

t is held wi

thin a busines

s model whose o

bjective is achieved by bot

h colle

cting contract

ual

cash flows and s

elling the fina

ncial ass

ets; and

The contract

ual terms of the fi

nancial asset give ris

e on speci

fied dates to cas

h flows that

are solel

y payments

of principal

and interes

t on the

principal amount

outs

tanding.

By default, all ot

her financial

ass

ets are measured s

ubse

quently at fai

r value thro

ugh profi

t or loss (FVPL).

Despite the foregoing, the Group may make the f

ollowing irre

vocable election / desi

gnation at initial recognition of a

financial ass

et:

The Grou

p may irrevocably elect

to present subs

equent chan

ges in fair value

of an equity i

nvestment in othe

comprehensive income

if certain criteria are met; and

The Grou

p may irrevocably de

signate a debt i

nvestment t

at meet

s the amortized cos

t or F

VOCI crit

eria as

measured at FVPL if doing so

eliminates or

signi

ficantly re

duces

an accou

nting mismatch

ڍڑٻ

1-1)

Amortization cost and effecti

ve interest rate method

The effective interest

method is

a method of calculati

ng the amortized cos

t of a debt instrument and of allocat

ing inte

rest

income over the rele

vant peri

od. The amortized cost of a f

inancial asset is

the amount at which t

he financial ass

et is

measured at initial recognition minus th

e principal repayments, plus the cumulative amortisation

using the effective

interest method of any diffe

rence between that initial amount

and the

maturity amount, a

djust

ed for any loss allowance

The gross

carrying amo

unt of

a financial

asset

is the amort

ized cost of a fina

ncial ass

et before adj

usting

for any l

oss

allowance. Interest

income is

recognized us

ing the eff

ective

interest met

hod for de

bt instruments

measured subs

equently

at amortized cost and at FVOCI.

1-2)

Debt instruments class

ified as at FVOCI

Corporate b

onds are initially measured

at fair value plus tran

saction co

sts. Subsequently

, changes in th

e carrying amount

of these corp

orate bon

ds as a

result of foreig

n exchan

ge gains

and losses, impairment

gains or losses

, and interest

income

calculated us

ing the effective interes

t method are recognized i

n profit or loss

. The amount

s that are recognized in profi

or loss are the s

ame as the amounts that would have been re

cognized in profit or loss

if these corporate bonds

had been

measured at amortized c

ost. All other changes in the car

rying amount of these corporat

e bonds are rec

ognized in other

comprehensi

ve income and

accumulated in inves

tments

revaluation res

erve. W

hen these c

orporate bonds ar

derecognized, t

he cumulati

ve gains or

losses

previously

recognized

in other c

omprehensive income are

reclassified to

profit or lo

ss.

1-3)

Equity inst

ruments

designate

d as at FVOCI

On initial recognition, the Group may make

an irre

vocable election (on an ins

trument

-by-ins

trument basis) to des

ignate

investme

nts in equity

instrume

nts as at FVO

CI. Designatio

n at FVO

CI is not pe

rmitted i

f the equity

investmen

t is held

for trading o

r if it is contingen

t consideration recognize

d by an acquirer i

n a busines

s combinati

on.

Investm

ents in equity instr

uments at FVOCI are initially

measured at f

air value plus transaction co

sts. Subsequen

tly, they

are measured at fair value w

ith gains

and losses

arising from changes

fair value recog

ized in other com

prehensive

income and accumulated in

the investments revaluation

reserve. The cumulative gain

or loss will not be reclassified

profit or los

s on dispos

al of th

e equity investments, i

nstead, it i

s transferred to ret

ained ear

nings.

1-4)

Financial assets measured at FVPL

Financial assets that d

o not meet the criteria for

eing measur

ed at amortized cos

t or FVOCI are

measured at FVPL. Gains

or losses

arising from c

hanges i

n the fair value of F

VPL, di

vidends and i

nterest inco

me from t

he financial asset

s are

recognized in p

rofit or los

2) Foreig

n exchange gain / loss

The carrying amount o

f a financial asset designated as

a fore

ign currency is determined in foreign currencies and is

translated at the spot exchange

rate

t the

end o

f the r

epor

ting

per

iod.

(8)

Impairment of

financial assets

The Group recogni

zes a loss al

lowance for expect

ed credit l

osses on i

nvestments i

n debt inst

ruments that are meas

ured

at amortized cost or at FVOCI, lease r

eceivables, trade receivables

and contract

assets

, as well as on financial guarantee

contracts. The amou

nt of expected credit loss

es is updated

each rep

orting date to reflect changes

in credit risk s

ince

initial recognition of the res

pective financial inst

rument.

The Group always rec

ognizes lifetime ex

pected credit los

ses (ECL) for trade

eceivables, contract assets and lease

receivables. The EC

Ls on the

se financial assets are es

timated

using

a provis

ion matrix b

ased on the Group’s

historical

credit loss

experience a

d va

luation of i

ndividual

assets, adjusted fo

r factors that are s

pecific to t

he de

btors, genera

economic conditions an

d an asse

ssment of forecast on pres

ent

and future con

ditions reflecti

ng time value

of money where

appropriate.

For all ot

her financi

al ins

truments

, the Grou

p recognizes life

time ECLs when there has been

a significant inc

rease in

credit risk since initial recogniti

on. However, if the credit ris

k on the financ

ial instrument h

as not

increased significantly

since initial recognition, t

he Group meas

ures

the los

s allowance for that

financial inst

rument at an am

ount equal

to 12-

month ECLs.

ڍڒٻ

Lifetime ECL represen

ts the expected credit

losses that will result from all possible d

efault events over the expected life

of a financia

l ins

trument. In

contrast, 12-month

ECL represent

the portion of lifetime ECL that is expected to result from

default events o

a financi

al i

nstrument that are

possible within 12

months

after the re

porting dat

1) Significant increase in credi

t risk

In assess

ing whether the credit risk on a

financial instru

nt has increased s

ignificantl

y sin

ce initial recognition, the

Group compares t

he risk of a

default occurring on the fi

nanc

ial inst

rument at the report

ing date w

ith the risk

of a defaul

occurring on the f

inancial instrumen

t at the date of initial recognition.

In particular, the f

ollowing

informatio

n is taken int

o account when asses

sing whether credit

risk has i

ncreased

significantly

since initial recognitio

an actual or expected significant deterioration in the financ

ial instrument’s external (if available) or in

ternal

credit rating

;

other significant in

creases in credit risk;

2) Definiti

on of de

fault

The Group believes that

, based on past experi

ence, if the debtor vi

olates the t

erms of the contract, it

is consi

dered to

constitute a default ev

ent for internal credit risk managem

ent purposes.

3) Credit-imp

aired financial assets

A financial asset is credit-im

paired when o

ne or more events that have a detrimental im

pact on the estimated

future cash

flows of that fi

nancial ass

et have occu

rred. Evidence that

a financial asset is

credit-impair

ed includes th

e following

observable data:

(a)

sig

nificant finan

cial difficulty of the issuer or the borr

ower;

(b)

a breach of contract

, such as a defaul

t or past

due event as

defined b

y the Group’s i

nternal

policy;

4) Measurements and reco

gnition of expected credit los

ses

The measurement of ECLs is a function of the probab

ility of defa

ult, loss giv

en default (i.e. the magnitu

de of the loss if

there is a default) and the exposure at d

efault. The assessment of th

e probability of default and loss giv

en default is based

on historic

al data adj

usted by forward-lo

oking information as

described above. As

for the

exposure at default,

for financial

assets

, this is repres

ented by the as

sets’ gros

s carrying am

ount at the rep

orting dat

For financial assets, the EC

Ls are estimated as the difference

between all contractual cash f

ows that are due to the Group

in accordance with the c

ontract and all

the

cash flows

that the

Group ex

pects to receive,

discounted at the origi

nal effective

interest rate.

If the Group

has measured

the loss

allowance for a

financi

al instrument

at an amou

nt equal t

o lifetime EC

Ls in the

previous re

porting peri

od, but determines at

the current re

porting date that the c

onditions

for l

ifetime ECLs

are no longer

met, the Group measur

es the loss allowa

nce at an amount equal to

12-month EC

Ls at the

current reporting date, except

for financia

l asset

s for which

a simplified approach is

used.

The Group recog

nizes an impairment gai

n or loss

in profit

or loss for al

l financial i

nstruments w

ith a correspon

din

adjustment t

o their carrying a

mount through a loss al

lowance a

ccount, except

for invest

ments

in debt instrument

s that are

measured at FVOC

I, for whic

the loss allowance is recognized in other comprehensive income and accumulated in the

investment reval

uation reserve

and does not reduce the carrying amou

nt of the financial as

set in the st

atement of financial

positi

on.

ڍړٻ

(9) Derecognition of financial assets

The Group de

recognizes a fi

nancial as

set only when the cont

ractual ri

ghts to t

e cash fl

ows from t

he ass

et expire, or w

hen

it transfers the financial asset and sub

stantially all the risks

and rewards of ownership of the asset to another entity. If th

Group neithe

r transfers

nor re

tains s

ubstanti

ally all

the risk

s and rewa

rds of owners

hip a

nd cont

inues

to control the

transferred ass

et, the Group re

cognizes its retained interes

t in

the ass

et and an associated lia

bility for amounts it may have

to pay. If the Gr

oup retains subs

tantiall

y all the ris

ks and rew

ards of owne

rship of

a transf

erred financia

l asset

, the Group

continues to recognize t

e financial ass

t and also recognizes

a collateralized

borrowing for

the proceeds received.

On derecognition o

a financia

l asset

measured at amortized cos

t, the difference bet

ween the as

set’s carryi

ng amount an

the sum of the consideration received and receivable is recognized in profit or loss. In addition, on derecognition of an

investment i

n a debt instrum

ent class

fied as at FVOCI, the cumulative gain

or loss prev

iously accumulated

in the

investmen

ts revaluation

reserve is reclassified to profit or lo

ss. In contras

t, on derecognit

ion of an in

vestment in

equity

instrumen

t which the Group has elected on initial recognitio

n to measure at FVOCI, the cumulative gain or loss prev

iously

accumulated in the investments

revaluation

reserve is

not reclassified to profit or

loss

, but is transferred to retained

earnings.

(10) Inventory

Inventory is

measured at the

lower of cost or net real

izab

le val

ue. Inventory c

ost, including the fi

xed and variable

manufacturing ove

rhead cost, is calcul

ated, using t

he moving average method, except fo

r the cost for invent

ory in trans

it,

which is determ

ined by the specific identif

ication method.

(11) Investment

s in ass

ociates and joint

ventures

An associat

e is an entity over which t

he Group has signi

ficant infl

uence, but not a joint vent

ure or a subsidiary. Signifi

cant

influence is t

he power

to parti

cipate in the

financial a

nd operating pol

icy decisions

of the

investee, but is n

t cont

rol or

joint contro

l over those policies.

A joint ventur

e is a joint arrangement, whereby the parties that

have j

oint cont

rol of the

arrangement

have right

s to t

net assets of the join

t arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which

exists only wh

en decisions about the r

elevant activities require unanimou

s consent of the parties sharing contro

The investment i

n an ass

ociate or a joint

venture is

initial

ly recognized at

cost

and accounte

for usi

ng the equit

y method

Under the equity method, an invest

ment

in an associate or a joint venture is

initially recognized in the consolidated

statement of financial position at cos

t and

adjusted thereafter

to rec

ognize the Group'

s share of the profit or loss

and other

comprehensi

ve income of the

ass

ociate or the joint vent

ure.

When the Group's

share of losses of an ass

ociate or a joint venture exceeds the Group'

s interest in that associate or j

oint

venture (which i

ncludes any long-te

rm interes

ts that, in s

ubst

ance, form part

of the

Group'

s net invest

ment in t

he associate

or the joint venture

), the Group discontinues

recognizing i

ts share of furt

her los

ses. Addit

ional losses

are recognized onl

to the extent that

the Group has incurred legal

or constructiv

e obligations

or made paymen

ts on behalf of the as

sociate or

the joint ven

ture.

Investment in as

sociate or joint vent

ure is accounted fo

r using t

he equity method from t

he date that the invest

ee becomes

the associat

e or joint venture

. Any excess

of the cost of ac

quisition over the Grou

p's share of the net fair value

of the

identifiable assets, liab

ilities and co

ntingent liabilities of an

associate or a joint ven

ture recognized at

the date of acquisition is

recognized as goodwill, which

is included within the

carrying am

ount of the invest

ment.

Any excess of the Group'

s share of the net fair value of th

identifiable assets, liabilities and contingent liabilities

over

the cost of acquisition

, after reassessment, is reco

gnized immediately in

profit or loss.

The requirements

of K-IFRS 1028 are appli

ed to dete

rmine whethe

r it is neces

sary to recogni

ze any impairment

loss wi

respect to the Group

’s invest

ment in an associ

ate or a joint ve

nture. When there is any indic

ation of impairment, the enti

carrying amount of the inves

tment (incl

uding goodwill) is

tested for impairment

in accordance with K-IFR

S 1036 as a

single as

set by comparing its

recoverable amount (hi

gher of val

ue in use and fair value l

ess cos

ts of disposal

) with its

carrying amount. Any impair

ment loss rec

ognized is not allocated to any ass

et,

including goodwill that forms part of the

carrying amount of the inves

tme

nt. Any reve

rsal of that impairment loss is recognized in accordance with K-IFR

S 1036

to the extent that t

he recoverable amount of t

he inves

tment s

ubsequently increas

es.

ڍڔٻ

Upon disposal

of an associate or a j

oint venture that res

ults in t

he Group losing s

ignificant

influence over t

hat associat

or joint venture, any retained investm

ent is measured at fair

value at that date and the fair valu

e is regarded as its fair

value on initial recognition as

a financial

asset in accor

ance with K-IFRS

1109.

The di

fference between the p

revious

carrying amount

of the associate or joint venture at

tributabl

e to the retained inte

rest and i

ts fair value is

included in the

determinatio

n of the gain or loss on d

isposal of the asso

ciate or joint ven

ture. In addition, the Group accounts fo

r all

amounts previ

ously recogni

zed in other co

mprehens

ive income in rela

tion to that as

sociate or joint vent

ure on the sa

basis we would

be required if that associate or joint venture ha

d directly disposed of the related assets or liab

ilities.

Therefore, if a gain or l

oss previously recognized i

n other co

mprehensive inc

ome by that as

sociate or joint

venture would

be reclassified to

profit o

r loss on th

e disposal of

the relate

d assets or liab

ilities, the Gro

reclassifies the gain

or loss

from equity to profit o

r loss (as reclassification ad

justment) wh

en it loses s

ignificant

influence

over that as

sociate or joint

venture. When t

he Group redu

ces its ownership int

erest in a

n associate or a j

oint ventu

re, but the Group c

ontinues to

use

the equity meth

od, the Group

reclassi

fies to profit or l

oss the pro

portion of the

gain or loss that had previo

usly been

recognized in

other comp

rehensive income rel

ating t

o that r

eduction in owners

hip interest if t

hat gain o

r loss would be

reclassified to p

rofit or loss on the disp

osal of the related assets or liabilities. In

addition, the Group app

lies K-IFRS 110

to a portion of inv

estment in an associate o

r a joint venture

that meets the criteria to be

classified as

held for sale.

The Group continues to use the equity method when an investment in an associate be

comes an investment in a joint

venture or an inves

tment in a joi

nt venture becomes

an inves

ment in an associate. Ther

e is no remeasuremen

t to fair

value upon such

changes in o

wnership interests.

Unrealized gains fr

om trans

actions between t

he Group a

nd its

associates or joint

ventures

are eliminated up to the s

hares

in associat

e (joint venture

) stocks. Un

realized losses

are also e

liminated, unless ev

idence of impairmen

t in assets

transferred is

produced.

If the accou

nting pol

icy of as

sociat

es or joint ve

ntures differs

from the Gro

up, financia

statements

are adjusted accord

ingly before a

pplying equity

method of acco

unting.

(12)

Property, pl

ant and eq

uipment

Property, pl

ant and equipme

nt is recognized if, a

nd only if it is

probable that fut

ure economi

c benefits as

sociated wi

th the

asset will flow to the Gr

oup, and the cost of the asset can be measured reliably

. After the initial recognition, proper

ty,

plant and equipment is stated at cos

less accumulated depreciation and accu

mulated impai

rment losses

. The cost includes

any cost directly

attributable to bringing th

e asset to the

location and condition necessary

for it to be capable of operating

in the mann

er intended b

y managemen

t and the initial estimate o

f the costs of

dismantlin

g and removin

g the item and

restoring the s

ite on which it

is located. In addition, i

n case the recognition criteri

a are met, the s

ubsequent cost

s will be

added to the carryin

g amount of the asset

or recognized as

a separate as

set, and the carryin

g amount of what

was replace

is derecognized

Depreciation i

s computed us

ing the s

traight-li

ne method

based on the es

timated useful

lives

of the asse

ts. The

representative useful lives are

as follows.

Representative us

eful lives (years)

Buildings

and structures

12 – 50

Machinery and eq

uipment

6 – 15

Vehicles

–

Dies, mold and t

ools

4 – 6

Office equipme

3 – 15

Other

–

The Group reviews

the depreci

ation method, t

e estimated us

eful lives and residual

values of propert

y, plant an

equipment at the end o

f each annual rep

orting peri

od. If expectati

ons differ from pre

vious estimates

, the changes are

accounted for as a c

hange in accounting es

timate.

(13) Investment properti

Investment pr

operties are pro

erty held to ea

rn rentals or

r capital appreci

ation or b

oth. Inves

tment prope

rties are

measured in

itially at its cost and transactio

n costs are included in the initial measur

ement. After initial recognition, the

book value of in

vestment pro

perties is

presented at the cost less accumul

ated depreciation and accum

ulated impairme

losses.

Subsequent c

sts are reco

gnized as the carryi

ng amount of the as

set when

, and onl

y when it i

s pro

bable that

futur

economic benefits ass

ociated with the asse

t will flow to the Group, and the cost of

the asset can be measured reliably,

recognized as a separate as

set if appropriate. T

carrying amount

of what was replaced is derecog

nized.

ڎڋٻ

Land is not depreciat

ed, and other inves

tment propert

ies are

depreciat

ed using the st

raight-line method o

ver the perio

from 20 to 50 years

. The Gr

oup reviews

the depreciation

method, the esti

mated usef

ul lives and res

idual values at

the

end of each annual reporting period.

expectations differ

from previous

estim

ates

, the changes are accounted for as a

change in accounting estimate.

(14)

ntangible assets

Goodwill

Goodwill arising from a business

combinati

on is recognized as an asset at the time of obtaining control (the acquisition

date). Goodwill is meas

ured as the e

xcess of the a

ggregat

e of the cons

ideration transfe

rred, the amount of

any non-

controllin

g interest in th

e acquiree and the acq

uisition-date f

air value of the Gr

oup’s previously h

eld equity in

terest in the

acquiree over the net of the acquisition-da

te amounts of th

e identifiable assets acquired and the liabilities assum

ed.

If, after reassessmen

t, the net of th

e acquisition-date amoun

s of the identif

iable assets acquired

and the liabilities assu

med

exceeds the aggregate of the cons

ideration

transferre

d, the amount of any non

-contro

lling interest

in the acquiree, and the

acquisition-date fair val

ue of the Group’s

previously hel

equity interest in the acq

uiree, the excess

is recognized

immediately in p

rofit or los

s as a bargain

purchase gai

Goodwill is not amortized,

but tested for impair

ment at leas

t annually. For

purposes of impairment tes

ts, goodwill is

allocated to

those cash-

generating units (“C

GU”) of the Grou

expected t

o have synergies

om the busi

ness com

bination.

CGU that goodwill has been

allocat

ed is tested for impairment eve

ry year

or when an event

occurs that indicates

impairmen

If the recov

erable amount of a CGU is less than its carr

ying amount, th

e impairment will first decrease the g

oodwill

allocated to that CGU an

d the rema

ining imp

airment will be allocated among

other assets relative to its car

rying v

alue.

Impairm

ent recognized for goodwill may not b

e reversed. When disposing a sub

sidiary, related goodwill will be in

cluded

in gain or los

s from dis

posal.

Development cost

The expenditur

e on researc

recognized as an

expense when it i

s incurred.

The expenditure

on de

velopment i

recognized as an i

ntangible a

sset, and amortization i

s computed us

ing the straight-line

method based

on the esti

mated

useful lives of the ass

ets since the

ass

et is available for use or s

ale.

Research and development activities are conducted in phases of preceding research, developmen

t approval, product

development an

d mass producti

on. The Gro

up generally

rec

ogni

zes intangi

ble assets as development

activities after the

development appr

oval phases which product

specification, r

eleas

e schedule, and sal

es plan are establi

shed. Expenditur

incurred at the previous

phase

is recognis

ed as an expense as

it is consider

ed as research ac

tivitie

s when it is incurred

Intan

gible assets acquired separately

Intangible assets are m

easured initially at cost, and are subs

equently measured at cost less accumulated amortization and

accumulated impairment loss

es.

Intangib

le assets are amortized by th

e straight-line method based o

n estimated useful liv

es from the date of availability

The Group reviews the estim

ated useful li

fe an

d amortizat

ion method at the e

nd of each annual report

ing period

. If

expectations differ fr

om previ

ous estimates

, the changes are

accounted for

as a chan

ge in accoun

ting estimate. Intangible

assets asses

sed as having inde

finite useful life such as

club

membership are

subjected to i

mpairment test

at least once a

year without amortizatio

The representative us

eful

lives are as follows

epresentative useful lives (y

ears)

Development c

osts

3, 7

Industria

l property

rights

5 – 10

Software

–

Other

5 – 40

ڎڌٻ

(15) Impair

ment of no

n-finan

cial assets

The Group asse

sses at the end

of each

reporting period

whethe

r there is an

y indication that

an asset may be

impaired. If

any such indi

cation exis

ts, the Group estimates

the recove

rable amount of

the asset to det

ermine the exte

nt of the

impairment loss

. Recoverable amount is t

he higher of fair v

alu

e less cos

s to sell

and value in use. If the cash i

nflows of

an individual

asset are l

argely indepen

ent from

other as

sets or gr

oup of assets, the rec

overable amount is meas

ured for

that individual

asset;

otherwise, i

t is measured for the

cash generati

ng unit (C

GU) to which t

he asset bel

ongs. An

impairment loss in res

pect of

goodwill is

not reversed.

For other assets, impairme

loss is reversed if

the reco

verable

amount increas

es in s

ubsequent

years, but onl

y to the e

tent

that the ass

et’s carrying am

ount does not exceed the

carrying

amount that

would ha

ve been determined,

net of

depreciatio

or amortizat

ion, if

no impair

ment loss had been reco

gnized.

Intangib

le assets with indefinite u

seful lives or in

tangible as

sets not

yet available for us

e are not amorti

zed, but te

sted for

impairmen

t annually.

(16)

Non-current assets clas

sified as held for sale

The Group classifies

a non-current ass

et (or

disposal grou

) as held for sale, if

its

carrying amount will be recovered

principally thr

ough a sal

e trans

action rather than t

hrough cont

inuing us

e. For this t

o be the case, t

he asset (or dis

posal

group) mus

t be available f

or immediate sale i

n its present

condit

ion subj

ect only t

o terms

that are usual a

nd customary

for sales

of such

asset

s (or di

sposal gr

oups) and its

sale mus

t be highly pr

obable. The

management

must be commit

ted

to a plan to sell the asset (or disposal

group), and the s

ale should be expected

to qualify for recognition as

a complete

sale within one y

ear from th

e date of clas

sification.

Non-current as

sets (or

disposal gro

up) clas

sified as

held f

r sa

le are measured at

the lower

of their carr

ying amount a

fair value, less co

sts to sell.

(17) Lease

At contract inception, t

he Group assess

es whether a contract is

or contains a lease.

A co

ntract is, or co

ntains, a lease i

the contract conveys

a right t

o control the us

e of an identi

fied as

set for a period

of time in exchange for cons

ideration.

When asses

sing whether the contract conveys

a right to

contro

l the

use of an identified

asse

t, definition of a lease unde

K-IFRS

1116 has been appli

ed.

1) As a less

At inception or effective date of change, the Group allocates the consideration in the contract to each lease on the basis

of their relative stand-alo

ne prices. However, f

r leases of

operties in which it is a lessee, the Group has elected no

t to

separate non-lease comp

onents and will instead accou

nt for

the lease and non-lease comp

onents as a sin

gle lease

component.

The Group recognizes a right-of-use asset and lease liability

the lease commenceme

nt date

. The righ

t-of-use asset is

initially measur

ed at cost, which comprises the in

itial amount of

the lease liability adju

sted for any lease paymen

ts made

at or befo

re the commencement date, p

lus any initial direct co

sts incurred

and an estimate of

costs to dismantle an

d remove

the underlying ass

et or to rest

ore the underlying as

set or the

site on which it is located, less any leas

e incentive received.

The right-of use asset is subsequen

tly depreciated using the straight-line meth

od from the commencement date to the end

of the lease term,

unless the leas

e transfers owners

hip of the

underlying asset t

o the Group

by the end o

f the lease term

the cost of the r

ight-of-use asset reflects that th

e Group will

exercise a purchase option. In

that case the right

-of-use asse

will be depr

eciated over the useful life of the underlying asset, which is determined on the same basis as th

ose of property

and equipment. In addition, the righ

t-of use asset is periodically reduced by impairment losses, if any

, and adjusted for

certain remeasurements of

the lease liability.

The lease liability is initia

lly measur

ed at the present v

alue of

the lease payments that are not paid at th

e commencement

date, discount

ed using the int

erest rate implicit in the leas

e or, if that rate cannot be readil

y determined, the Gro

up’s

incremental borro

wing rate. Generally, the Group uses its incremental borrowin

g rate as the discount rate.

When the lease liability

is remeasured

, a corresponding adjust

ment is made to

the carrying amount of the right-of-use

asset, or i

s recorded in pr

ofit or loss if the carryi

ng amount of the rig

t-of-use

asset has

been reduced to ze

ro.

ڎڍٻ

The Group has elected not to recognize right-of-use assets and lease liabilities for leases of

low-value assets and short-

term leases. The Group rec

ognizes the lease payme

nts associated

with these leases

as an expense on a s

traight-line

basis

over the lease term.

2) As a les

sor

The accounting pol

icies appl

icable

in the same period t

o the Group as

a lessor are not

different from t

hose unde

r K-IFRS

1116. When the Group acted

as a lessor, it determined at l

ease inception whether each lease was

a finance lease or an

operating lease. To class

ify each lease, the Gro

p made

an overall assessment of whether the leas

e transferre

substant

ially all

of the risks and rewards incident

al to own

ership of the underl

ying asset. If this w

as the case, then the

lease was a finance lease; if not,

then it was

an operating lease.

Amounts due from less

ees under finance l

eases are recognize

d as receivables at th

e amount of the Group’s net investment

in the leases. Fi

nance leas

e interest

income is allocated

to accounting

periods

so as to refl

ect an effective interest rat

e on

the Group’s net

investment

outstanding in res

pect of the

leases. R

ental income from opera

ting leases

is recognized

on a

straight-line b

asis over the term of the relevant lease. Initial direct costs incurred in negotiating and arrang

ing an operati

lease are added to

the carryi

ng amount o

f the carryin

g amount

of investments in oper

ating leases and recognized a

expense on a st

raight-line

basis over t

he lease term.

(18) Borrow

ing

costs

Borrowing c

sts

directly att

ributabl

e to the

acquisit

ion, cons

truction or p

roduction of qual

ifying as

sets

are capitali

zed to

the cost of those ass

ets, until they are

ready for their intende

d use or sal

e. A qualifying asse

t is an asset t

hat necessarily

takes a subs

tantial period of time to get ready for its

intende

d us

e or sale. Inves

tment income earned on the temp

orary

investment of s

pecific borrow

ings pending their ex

penditur

e on qualifying asset

s is dedu

cted from the borrowing

costs

eligible for capit

alizati

on. All ot

her borrowin

g costs

are recognized in

profit or l

oss in

the period in which the

y are

incurred.

(19)

Retirement ben

efit plans

The retirement

benefit obli

gation reco

gnized in t

he consoli

dated statements of fi

nancial position rep

resents t

he present

value of the defined be

nefit obligation, les

s the fair value of

plan ass

ets. Defi

ned benefit ob

ligations are calculated by an

actuary using t

he Projected U

it Credi

t Method.

The present val

ue of t

he defined be

nefit obligations i

s meas

ured by discounting es

timate

d future cash

outflows by the

interest rat

e of high-quality cor

porate bonds, with si

milar maturity as the expect

ed post-empl

oyment benefi

t payment date

In countries where there i

s no deep market in s

uch bonds

, the market yields

at the end of the reporti

ng period on

government b

onds are us

ed.

The remeasuremen

ts of the net defined

benefit liabilities (asset

s) comp

rising actuarial

gain or

loss from changes in

actuarial assumptions or dif

ferences betw

een actuarial ass

umptions and act

ual resu

lts, the effe

ct of the changes to the

asset ceiling and return on plan assets, exclu

ding amounts included

in net interest on the net defined benefit liabilities

(assets

), are recognized in ot

her comprehensive income

of the consolidated s

tatements of

comprehensive income, whic

is immediately recognized as retained earni

ngs. Those recognized in retained earnin

will not be reclassified in profit

or loss. Past s

ervice costs are recognized

n profit and loss when

e plan amendment occurs, and

net in

terest is calculated

by applyi

ng the

discou

nt rate determine

at t

he begi

nning

of the

annual re

porting peri

od to the

net defined

benefit

liabili

ties (assets

). Defined benefit cos

ts are composed of s

ervice cost (i

ncluding current s

rvice co

st, past serv

ice cost,

as well as gains and

losses on settlemen

ts), net

interest expense (income), and remeasurements.

The retirement

benefit obl

igation reco

gnized in the consoli

dated statements of fi

nancial pos

ition rep

resents the actual

deficit or su

rplus in the Group’

s defined benefit

plans. An

y su

rplus resu

lting from this calculation

is limited to the present

value of any economic

benefit

s available in the form of refun

ds from the plans

or reduction

s in future contributions

to the

plans.

Contribut

ions to define

d contribution reti

rement benefi

t pl

ans are recognized as expenses

when employees provi

services eligible for

payment.

ڎڎٻ

(20) Provi

sions

A provision i

s recognized whe

n the Group has a present obl

igation (legal or cons

tructive

) as a result

of a past event, it is

probable that an outf

low of resources embody

ing economic benefits will be required

to settle the obligatio

n and a reliable

estimate can be made of t

he amount o

f the obligatio

n. The amount rec

ognized as a provisi

on is the best

estimate of the

consideration re

quired to settle

the present obli

gation at t

he end of the report

ing period, t

aking i

nto account the ri

sks and

uncertainties

surrounding t

he obligati

on. A

provis

ion is

meas

ured using t

he present

value of the

cash fl

ows esti

mated to

settle t

he present obligati

on.

The increase in provi

sion due

to passage of time is reco

gnized as

interest expens

The Group recognizes

provisions

for c

osts expected to

be incurred

in the future for the re

pair of regular parts within the

warranty peri

od based

on historical experience

and compensat

ion for accide

nts caused by defect

s in the e

xported p

roducts

or parts of the p

roduct when

such amounts are pr

obable of payment. Als

o, the Group recognizes

provis

ions for th

probable los

ses of u

nused loa

n commitment

, const

ruction cont

racts, pre

-contract sal

e or s

ervice contract due t

o legal or

constructive o

bligations

. In ad

dition, the Compan

y recogniz

es provisions expect

ed to be

paid in the

future with regard

long-term empl

oyee benefi

ts payable t

o long-term

employee

When some or

all of the economic benefits required to settle a p

rovision are expected to

be recovered from a third party,

a receivable is recognized as an as

set if it is virtually certa

in that reimbursemen

t will be received and the amount o

f the

receivable can be measure

d reliably.

(21) Taxation

Income tax expe

nse is composed of c

urrent and

deferred tax.

Curr

ent tax

The current ta

x is comput

ed based on t

he taxabl

e profit for

the current year. The t

axable profi

t differs

from the

profit

before income tax

as re

ported in t

he cons

olidated statements of i

nco

me because

it exclud

es items of income

or expense

that are taxable or deducti

ble in ot

her years and it further e

xcludes items

that are never taxable or deduct

ible. The Group’

current tax

liability is calculate

d using tax ra

tes that have been

enacted or su

bstantively enacted by

the end of

the reporting

period.

The amou

nt of c

urrent t

ax paya

ble or

receivable i

s the best es

timate

of the tax amount

expected to be

paid o

received that reflects uncertai

ty related to income ta

xes, if any.

Deferred

tax

Deferred tax is reco

gnized on tempo

rary differences be

ween the carrying amounts

of assets and liabilities

in the

consolidated fi

nancial

statements

and the correspon

ding tax bases

used in the comp

utation

of taxable

profit. De

ferred tax

liabilities are generally recognized

for all taxable temporary differences. Deferred tax assets shall be

generally recognized

for all deductib

le temporary differences to the extent that it is probab

le that taxable profits will be available again

st which

those deductible temporar

y dif

ferences can be

utilized. Such

deferred tax assets and liabilities

shall not be rec

ognized i

the temporary di

fference arises

from goodwill or fro

m the

initial recognition (othe

than in

a busines

s combinati

on) of

other assets and

liabilities in a transactio

n that affects ne

ither the taxable profit nor

the accounting profit.

Deferred tax liabilities are reco

gnized for taxable temporary diff

erences associated with in

vestments in

subsidiaries and

associates

and interests

in joi

nt ventures, exce

pt when the Group i

s able t

control

the timing of t

he reversal of the

temporary difference, and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred

tax asset

s arisi

ng from dedu

ctible te

mporary di

fferences as

sociated wit

h such invest

ments and interests

are only

recognized to the exten

t that taxable profit will be availab

e agains

t which the temporary

fference can be utilized and

they are expected to be re

vers

ed in the foreseeable future.

The carrying amou

nt of deferr

ed tax assets is

reviewed at th

e end of each

reporting period and reduce

d to the extent that

it is no long

er probable that sufficient taxab

le profits will be available to allow all o

r part of the asset to be recover

ed.

Deferred tax assets and

liabilities are measu

red at the tax rat

es that are expected

to be applied

in the period

in which the

liability is settled

or the asset i

s realized, based o

n tax rate

s and tax laws

that have been enacted or subs

tantively enact

by the end of the reporting period. The measurement of deferred tax assets and liabilities reflects the tax consequences

that would follow from the manne

r in which the Grou

p expects to recover or

settle the carrying amount of its assets and

liabilities at the end o

f the reporting p

eriod.

ڎڏٻ

Deferred tax assets and liab

ilities are offset when there is a

legally enforceable right t

o offs

et current

tax assets against

current tax liab

ilities and when th

ey relate to income

tax levied by th

e same taxation au

thority. Also, they ar

e offset when

differen

t taxable entities that intend eith

er to settle current

tax liabilities and assets o

n a net basis, o

r to realize the as

sets

and settle the liabilities sim

ultaneo

usly, in each future p

eriod in which signif

icant amounts of deferred tax

liabilities or

assets are expected to be settled

or recovered.

Recognition of

current and

deferred taxes

Current and defer

red taxes are recognized i

n profit

or loss, e

xcep

t when they relate to it

ems that

are recognized in ot

her

comprehensive income or dire

ctly in e

quity, or items arising from initial accounting

treatments of a bus

iness combination.

The tax effect a

rising fr

om a busines

s combination i

s include

d in the acc

ounting fo

r the busi

ness combinati

on.

(22) Treasury

stock

When the Group repurc

hases its

equity inst

ruments (treasury st

ock), the incrementa

l costs and net

of tax effect are

deducted from

equity a

nd recogni

zed as ot

her capital it

em deducted

from the total equity

in the consolidated st

atements

of financial p

osition. In a

ddition, profits

or losses

from purchase, sale

or retirement

of treasury s

tocks are di

rectly

recognized in equity and not in current profit or loss.

(23) Financial liab

ilities and equity

instruments

Debt instrumen

ts and equity instruments issu

ed by the Group are recognized as financial liabilities or eq

uity depending

on the contract and th

e definitions of financial liab

ility and equity instrum

ent.

1) Equity i

nstruments

An equity instru

ment is any contract that evidences a residual inter

est in the assets of an entity after deduc

ting all of its

liabilities. Equity in

struments issued b

y th

e Group are recognized at the proceeds received, net of direct issue costs.

Repurchase of

the C

ompany’s ow

n equity

instruments

is recognized

and deducted di

rectly in e

quity. No gain

or loss is

recognized in p

rofit or los

s on t

he purchase, sa

le, iss

ue or cancellat

ion of the C

ompany’s o

wn equity inst

ruments.

2) Financial g

uarantee liability

A financial guarantee co

ntract is a contract

that the issuer mu

st pay a certain amo

unt of money

to compensate for lo

sses

incurred by the holder d

ue to the failure of a specific debt

or to

pay the due date on t

he original cont

ract or modifie

d terms

of the debt instrum

ent. Financial guarantee liabilities are measured in

itially at fair value and subsequently measured at

the greater of the

following, unle

ss they are

designated

as at fair

value throu

gh pro

fit or lo

ss or arising from

the transfer

of asse

ts.

Loss provision cal

culated i

n accordance wi

th K-IF

RS 1109

The amount recognized l

ess th

e accumulated profits reco

gnized in accor

ance with K-

IFRS 1115

3) Finan

cial liabilities measured

at FVPL

Financial liabilities ar

e classified as at FVPL when th

e financial liability is (i) con

tingent consideratio

n of an acquirer in

a business co

mbination, (ii) h

eld for trading or (iii)

it is designated as at FVPL as of the d

ate of initial recognition

However, for finan

cial liabilities that are designated as at FVPL, the amount of change in the fair value of the financial

liability that is attrib

utable to changes in

the credit risk of that liability is reco

gnized in other compr

ehensive income,

unless the recog

nition of

the effects of ch

anges in the liab

ilit

y’s cr

edit risk in oth

er comprehensiv

e income wou

ld create

or enlarge an accou

nting mismatch in prof

or loss. The remaining am

ount of c

hange

in the fair value of

liability is

recognized in pro

fit or loss. Changes in fair value attribu

table to a financial liability’s credit risk that ar

e recognized in

other comprehensi

ve income are not subs

equently reclassified to profit or l

oss; ins

tead, they are transferred t

o retained

earnings upon

derecognition

of the

financial l

iabilit

y. Gains

or los

ses on

financial

guarante

e contracts iss

ued by t

he Group

that are designated

by the Group as at F

VPL are recognized

in profit

or loss.

ڎڐٻ

4) Financ

ial liabilities measured su

bsequently

at amortized cost

Financial liabilities th

at are not (i) co

ntingent consid

eration of an acquirer in a busin

ess combinatio

n, (ii) held for trad

ing

or (iii) designated as at FVPL as of the

date of initial recogni

tion, are measured

subs

equent

ly at amortized cost using the

effective interest m

ethod. The effective intere

st method is a method

of calculating the amortized cost of a f

inancial liability

and of allocat

ing interest

expens

e over the relevant period

5) Derecognition

of financial liabilities

The Group derecognizes financial liabilities when, and on

ly when, the Group’s obligations are discharged, cancelled or

have expired. The difference

between th

e carrying amount of the financial lia

bility derecognized and the consideratio

paid and paya

ble is recognize

d in profit or los

(24) Derivat

ives

Derivatives are initially r

ecognized at fair value at th

e date the derivative contracts are entered into an

d are subsequently

remeasured to their fair val

ue at the end of each reporting peri

od. The res

ulting gai

n or loss

is recognized i

n profit or los

immediately, unles

s the deriv

ative is des

ignated and effecti

e as a hedging ins

trument, i

n such case, the timing of the

recognition in profit or lo

ss depends on the nature of the hedge relationship.

The Group designates

certain derivatives as

hedging instrum

ents to

hedge the risk of changes

in fair value of a recognized

asset or l

iabilit

y or an unrec

ognized firm commit

ment (fair v

alue hedges) an

d the risk of changes

in cash flow of a

highl

probable forecast trans

action and the risk of changes in fore

ign currency exchan

ge rates of

firm commitment (cash flow

hedges).

Fair value hedges

The Group recogni

zes the changes

in the fair

value of de

rivati

ves that are desi

gnated and

qualified as fai

r value he

dges

are recognized in profit or loss immediately, together with any change

s in the fair

value of the hedged asset or liability

that are attributable to th

e hedged risk. Hedge accounting is

discontinued when the Group

vokes the hedgi

ng relationship

when the hedgi

ng instrument expi

res or is

sold, ter

minated or exercised,

or when it is

no longer

qualified

for hed

accounting. The f

air value a

djustment

to the carrying a

mount of the hedged

item arisi

ng from t

he hedged risk is

amortized

to profit or lo

ss from that date.

Cash flow hedges

The effective porti

on of changes

in the fair value of derivati

ves that are designated and q

ualified as

cash flow hedges is

recognized in

other comp

rehensi

ve income. T

he gain or l

oss rel

ating to t

e ineffecti

ve porti

on is recognized i

mmediatel

in profit or lo

ss. Amounts previou

sly recognized in other comprehensive income and accumulated in equity are

reclassified to prof

it or loss in the periods when the hedged

item affects profit or loss. If the forecast transaction results

in the recognition o

f a non-fin

ancial asse

t or liability, the

related ga

in and loss

recognized in

other

comprehens

ive income

and accumulated in

equity are transferred from equity

to the initial cost of related non-

financial asset or liability.

Cash fl

ow hedge acc

ounting

is discontinue

d when the G

roup revokes

the he

dging relati

onship, whe

n the hedgin

instrument expi

res or is

sold, terminat

ed or exercise

d, or it no l

onger qualifies

for the crit

eria of hedging. Any gai

n or

loss accumulated in e

quity at that time rema

ins

in equity,

and is recognized as

profit or los

s wh

en the forecast transaction

occurs. W

hen the forecast tra

saction is no

longer expected

to occur, the

gain or

loss accumulated in

equity is rec

ognized

immediately in

profit or loss.

(25) Fair

value

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction

betwe

market participants at t

e measurement da

te, regardless of whether that price is directly

observable or estimated u

sing

another valuation technique.

In estimating the fair valu

e of an asset or a liability,

the Group takes into account the

characteristics of th

e asset or liab

ility if mark

et participants wo

uld take tho

se characteristics into accou

nt when pr

icing

the asset or liability

at the mea

surement d

ate. Fair value for

easurement and/o

r disclosure purposes in these con

solidated

financial statemen

ts is determined

on such

a basis, except for leasing trans

actions

that are within the scope of K-IFRS

1116

Leases

, and measurements that have so

me similarities to fair value, but are not fair value, such as net realisable

value in K-IFRS

1002

Invent

ori

or value in use i

n K-IFRS 1036

Impa

irment of Assets

ڎڑٻ

In addition,

for financi

al repor

ting purpos

es, fair value meas

ements are cate

gorized int

o Levels 1, 2 or 3, bas

ed on the

degree to which t

he inputs

to the fair value

measurements are observa

ble and the s

ignific

ance of the inp

uts to the fai

value measurement in its

enti

rety, which are

described in Not

e 20.

(26)

Accounting Treat

ment related

to the Emission R

ights Cap and Trade Sche

The Group classi

fies the emis

sion rights as

intangible as

sets

. Emission rights

allowance the govern

ment allocated free

charge are measur

ed at nil, and emission righ

ts allowance

purchased are measu

red at cost. No emission liab

ility is

recognized if the ex

pected qu

antity of emissi

on for the per

orming period does

not exceed the e

mission allowance in

possession. Th

e emission liab

ility is mea

sured based o

n the expected qu

antity of emission

for the pe

rforming period

excess of emis

sion allow

ance in posses

sion and the unit

price for s

uch emission ri

ghts in the market at

the end of the

reporting perio

(27)

Significant accounti

ng est

imates and key so

urces of estimation unc

ertainties

In the applicat

ion of the Gr

oup’s accounting polici

es, management

is requi

red to ma

ke judgments

, estimates

and

assumptions abo

ut the carrying am

ounts of

assets

and liabilities that cannot

identified from

other sources

. T

estimati

on and ass

umptions a

re based

on historical e

xperienc

e and othe

r factors that are

considered to

be releva

nt. Actual

results may be di

fferent

from t

hose esti

mations. The est

imates and un

derlying as

sumptions are co

ntinually evaluated.

Revisions

to accounting estimates are recogni

zed in the peri

od in which

the estimate is revised if the revision affects only

that period

or in the peri

od of the revision an

d future pe

riods if the revisi

on affects

both cur

rent and future

periods.

The management expects th

at the COVID-19 outbreak

from early 2021 will have an impact on mo

st of the regional and

operating sectors

in whic

h the Group

operates. However

, as the extent and durat

ion of the i

mpacts of COVID-19

outbreak remain

uncertain, t

he financia

l impact ca

nnot be re

asonably est

imated.

Information about

assumptions and estimati

on uncertainties

at December 31, 2021 that

have a s

ignificant risk of

resulting

in a material adju

stment to the carrying amounts of

assets and liabilities in th

e next financial year is as f

ollows.

1) Impairme

nt test

for goodwi

ll and non-fi

nancial asset

Determining wh

ether goodwill and non

-financial asset is im

paired requ

ires an estimation o

f the value in u

se of the CGU

to which goodwill has bee

n allocated and value in

use of non-

financial assets

. The value i

n use calculation requires the

management to

estimate t

he f

uture cash flow

s expected

to arise from

the CG

U and a

suitable di

scount

rate in

order to

calculate present value.

2) Warranty

provision

The Group reco

gnizes provis

ions for t

he warranti

es of i

products as

descri

bed in No

te 2.(20).

The amounts

are

recognized based o

n the best es

timate of amounts necessary

o settle the present and futu

re warranty obligation.

3) Defined be

nefit plans

The Group ope

rates defined

retirement benefit

plans. Define

d benefit oblig

ations are determined at the end of each

reporting perio

using an act

uarial valuation meth

od that

quires manageme

nt assumptions

on discount rat

es, rates

expected future salary

increases and mortality rates. The ch

aracteristic of post-emplo

yment benefit plan that serv

es for

the long ter

m period cause

s signi

ficant uncertai

nties when t

he post-employment

benefit obli

gation is es

timated.

Taxatio

The Group recogni

zes current

tax and deferre

tax based

on the best estimates

of income tax effect

to be char

ged in the

future as the r

esult of operating activities until th

e end of the reporting p

eriod. However, actual final in

come tax to be

charged in the future may diff

er from the relevant ass

ets

and liabilities recognized at the

end of the reporting period an

the difference may affect income tax charged or credited, or deferred tax assets and liabilities in the period in which the

final income tax determ

ined.

Fair v

alue of financ

ial instruments

The Group uses

valuation t

echniques

that include i

nputs that

e not based on observable market data to estimate the fair

value of certai

n type of fina

ncial instrument

s. The Group

akes judgements

on the choi

ce of various

valuation metho

and assumptions

based

on the condit

ion of the

principal

market at t

he end of the

reporting

period.

ڎڒٻ

Measurement and useful

lives

of property

, plant, e

quipment

or intangi

ble assets

If the Group acqui

res property

, plant, equipme

nt or intangible as

sets from busi

ness combin

ation, it i

s required to est

imate

the fair value o

f the assets at th

e acquisition date an

d determine the usefu

l lives of such assets

for depr

eciation and

amortization.

edit loss allowance

The Group sets credit loss

allowance upon

evaluation of impairment relating to acco

unt rec

eivables and financial services

receivables as described i

n Note 2.(8). The precision in los

s allowance is

based on the es

timation of expected cas

h flow

and assump

tions and variables of

risk measuremen

t model used for the estim

ation.

TRAD

E NOTES AND ACCOUNTS R

ECEIVABLE:

(1)

Trade notes and accounts receivab

le as

of December 31

, 2021 and December 3

, 2020 are

as follows.

December 31, 2021

December 31, 20

Description

Current

Non-current

Current

Non-current

(In millions of Korean Won)

Trade notes and accounts

receivable

୸

3,190,030

୸

145,648

୸

3,338,865

୸

128,599

Loss

allowance

(42,734)

(773)

(54,893)

(317)

Present value di

scount acc

ounts

(7,718)

(4,013)

୸

3,147,296

୸

137,157

୸

3,283,972

୸

124,269

(2)

Aging analysis of tra

de notes and accounts recei

vable

As of December 31, 2021, agi

ng analysis

of total trade notes and acco

unts

receivable that are past due, but not impaired

are as follows.

Description

Not

due

Overdue

Within

90days

Overdue

Within

180days

More than

91days

Overdue

More than

181 days

Total

amounts

Amount of

impaired

receivables

(In millions of Korean Won)

Total trade note and

accounts receivable

୸

2,998,927

୸

249,201

୸

5,437

୸

82,113

୸

3,335,678

୸

43,507

As of December 31, 2020, agi

ng analysis

of total trade notes and accounts

receivab

le that are past due, but not impaired

are as follows.

Description

Not

due

Overdue

Within

90days

Overdue

Within

180days

More than

91days

Overdue

More than

181 days

Total

amounts

Amount of

impaired

receivables

(In millions of Korean Won)

Total trade note and

accounts receivable

୸

2,937,200

୸

438,770

୸

3,677

୸

87,817

୸

3,467,464

୸

55,210

(3)

Transferred trade notes and ac

counts

receivable that are n

ot derecognized

As of December 31, 2021

and December 31, 2020, total tr

ade

notes and accounts

receivable (including inter-c

mpany

receivables within th

e Group) which the

Group transferred to financial instituti

ons but did not qualify

for derecognition,

amount to

୸

059,551 mi

ion and

୸

2,914,830 million, respectively. Cash

and cash equivalents received as

consideration fo

r the transfer

are recognized as

short-term b

orrowings due t

o the fact that the risks

and rewards were not

transferr

ed substantially

ڎړٻ

(4)

Changes in loss al

lowance for the years

ended December

31, 2021 and December

31, 2020

are as follows

Description

2021

2020

(In millions of Korean Won)

Beginning o

f the year

୸

55,210

୸

67,564

Impairment l

oss (reversa

2,204

(16,595)

Write-off

(14,307)

(1,296)

Effect of foreign exchange differences

and others

400

5,537

End of the yea

୸

43,507

୸

55,210

4. OTHER

RECEIVABLES

(1)

Other receivables as of December 31

, 2021 a

nd December 31, 20

20 are as follows

December 31, 20

December 31, 2020

Description

Current

Non-current

Current

on-current

(In millions of Korean Won

)

Accounts receivable

– others

(*)

୸

2,785,799

୸

373,569

୸

2,757,116

୸

350,549

Due from

customers for contract wor

1,421,108

1,252,11

Lease and rental de

posits

24,105

310,5

16,296

302,052

Deposits

7,289

33,469

5,268

39,752

Others

3,546

23,594

4,050

10,282

Loss allowance

(20,877)

(17,875)

(294)

୸

4,220,970

୸

741,168

୸

4,016,972

୸

702,341

(*) As of December 3

1, 2021

and December 31

, 2020,

the Group rec

ognized t

he reim

bursem

ent rela

ted to the war

ranty pr

ovisions as

a separate asset i

n the amo

unt of

୸

1,091,859 m

illio

n and

୸

073,098

million, respe

ctively.

(2)

Changes in other allowa

nce for the year ende

d D

ecember 31, 2021 and Dece

mber 31, 202

0 are as follows.

Description

2021

2020

(In millions of Korean Won)

Beginning o

f the year

୸

18,169

୸

15,403

Impairment l

oss (reversa

517

4,174

Write-off

(871)

(1,40

Effect of foreig

n exchange

differences

3,062

End of the yea

୸

20,877

୸

18,169

OTHER FINANCIAL ASSETS:

(1)

Other financial assets as

of December 31, 2021 a

re as follows

December 31

, 2021

Description

Current

Non-current

(

In million

s of Korean Won)

Financial assets measu

red at FVPL

୸

12,249,980

୸

222,120

Financial as

sets

measured at FVOC

25,150

2,886,373

Financial assets meas

ured at amortized cost

18,466

8,729

Derivative ass

ets that

are effective hedging ins

truments

103,050

422,064

୸

12,396,646

୸

3,539,286

ڎڔٻ

Other financial assets as

of December 31, 2020 are as

follows.

December

31,

2020

Description

urrent

Non-current

(In millions of Korean Won)

Financial assets measu

red at FVPL

୸

12,705,388

୸

388,069

Financial as

sets

measured at FVOC

36,831

2,286,11

Financial assets meas

ured at amortized cost

29,56

8,400

Derivative ass

ets that are effective hedging ins

trument

125,324

96,645

୸

12,897,108

୸

2,779,227

(2)

Financial assets measured at FVOCI as

of Decem

ber 31, 2021 and Decem

ber 31, 2020

are as follows

December 31,

2021

December 31,

2020

Description

Acquisition

cost

Book value

(In millions of Korean Won)

Debt ins

truments

୸

440,927

୸

450,711

୸

327,730

Equity inst

ruments

(*)

2,336

,347

2,460,812

1,995,214

୸

2,777,274

୸

2,911,523

୸

2,322,944

(*)

The G

roup make

s an i

rrevocable

elec

tion to pre

sent in other

com

prehe

nsive inc

ome subseq

uent cha

nges in the

fair va

lue of

investme

nt in an e

quity instrum

ent tha

t is no

t he

ld for

trading

at the

date of initia

l recogni

tion.

(3)

Equity instruments clas

sified into

financial assets meas

ured at FVOCI as

of December 31, 2021 a

nd December

31, 2020 are as

follows.

December 31,

2021

December 31,

2020

Name of the company

Ownership

percentage

Acquisition

cost

Book

value

Book

value

)

(In millio

ns of Korean Won)

Hyundai Steel

Company (*

6.87

୸

835,375

୸

434,277

୸

451,650

Grab Holdings Li

mited

1.14

442,922

362,508

Hyundai Glovi

s Co., Lt

4.88

210,688

314,922

336,893

ANI Technologi

es Privat

e Limited (OLA

)

3.42

278,9

290,116

278,955

Hyundai Oilban

k Co., Ltd.

4.35

53,734

230,812

222,524

Korea Aerospace Indust

ries, Ltd. (*

73,331

153,522

122,061

Hyundai Heavy In

dustries

Holdings C

o., Ltd.

2.20

9,018

94,892

98,36

NICE Informati

on Servic

e Co., Lt

2.25

3,312

24,587

33,875

Hyundai Gree

n Food C

o., Ltd.

2.36

15,005

20,077

20,215

Hyundai M Partne

rs Co., Ltd.

9.29

9,888

13,954

16,708

NICE Holdi

ngs Co., Ltd.

1.30

3,491

7,866

9,562

KT Corporati

0.09

8,655

7,443

5,762

Hyundai Asan C

rporati

1.40

22,500

2,117

Korea Shipbuil

ding & Of

fshor

Engineering C

o., Ltd (*

177,165

Others

369,473

503,719

219,366

୸

2,336,347

୸

2,460,812

୸

1,995,214

(*1)

The G

roup en

tered in

to a tota

l retur

n swap a

reem

ent to tra

sfer 1,

367,114 shar

es out

of total

10,540,709 sha

res with

a th

ird

party.

(*2) Th

e Group entered in

to a total return

swap ag

reement to

transfe

r total share

s with a thir

d party.

(*3) For th

e year ended December 31

, 2021, the Gr

oup has

disposed of

all

of its

ڏڋٻ

INVENTORIES:

Inventories as of December

31, 2021 an

d December 31,

2020 are as follows

Description

December 31, 2021

December 31, 20

(In millions of Korean Won)

Finis

hed goods

୸

5,987,233

୸

6,844,023

Merchandise

59,518

44,356

Semifini

shed goods

711,155

576,950

Work in progres

692,832

404,504

Raw mate

rials

2,536,6

1,633,579

Supplie

315,871

299,259

Materials in transit

730,970

625,833

Others (*

611,391

905,230

Total (*2)

୸

11,645,641

୸

11,333,734

(*1)

As of Decemb

er 31, 2

021 an

d December 31,

2020,

others inclu

de inventori

es provi

ded by op

erating lease wit

h repur

chase

agreement i

n the amou

nt of

୸

143,641 mi

llio

n and

୸

9,059 milli

on, respectively.

(*2)

As of December 31

, 2021

and December 3

1, 20

20, the Gr

oup recogniz

ed a valua

tion allowance

in the a

mount of

୸

167,888

million and

୸

164,

980 million, re

spectively.

7. OTHER

ASSETS:

Other assets as

of December 31, 2021 an

d December 31, 20

20 are as follows.

December 31, 2021

December 31, 2020

Description

Current

Non-current

Current

Non-current

(In millions of Korean Won

)

Accrued income

୸

353,643

୸

716

୸

327,079

୸

866

Advanced payme

nts

662,919

726,609

Prepaid

expenses

558,336

1,108,62

459,580

792,529

Prepaid value-a

dded tax an

d others

506,955

81,947

520,103

86,114

୸

2,081,853

୸

1,191,284

୸

2,033,371

୸

879,509

NON-CURREN

T ASSETS CLASSIFIED AS HELD FOR SAL

Non-current as

sets cl

assified as hel

d for sale as of D

ecember

31, 2021 and Decem

er 31,

2020 are as

follows.

Description

December 31, 2021

December 31, 2020

(In millions of Korean Won)

Land

୸

7,426

Building and

others

28,121

Subsidi

ary (*)

297,043

Total

୸

28,121

୸

304,469

Non-current liabilities classifi

held for sale (*

)

୸

214,066

(*)

Hyundai A

utoeve

r Corp., a

n as

sociate

of the Company, ente

red int

o a contract to

merge with Hy

unda

i Autron C

ompany Lt

d., the

subsidiary of t

he Compan

and HYUNDAI

MNSOFT, Inc., the

associate

of the Co

mpany, i

n Dece

mber 2020 a

nd the m

erger

was complete

d as of April 1,

2021. Accordingly, the

Grou

p clas

sifie

d the assets and lia

bilities related to Hyundai A

utron Compa

Ltd.

to disposal group

held for sale as o

f December 31

, 2020 and it was disp

osed of du

ring the year end

ed December 31

, 2021.

ڏڌٻ

PROPERTY, PLANT AND EQUIPMENT:

(1)

Propert

y, plant an

d equipment (“PP

&E”) as of Decembe

r 31, 2021 and

2020 are

as follows

Decemb

er 31,

2021

December 31, 20

Descri

tion

Acquisition

cost

Accumulat

reciatio

(

)

Book

value

Acquisition

cost

Accumulat

reciatio

(

)

Book

value

(

In millions of Korean Won

)

Land

୸

12,13

0,094

୸

12,13

0,094

୸

12,04

7,003

୸

12,04

7,003

Buildin

10,872,099

(

4,10

8,39

)

6,763,707

10,

067,787

(

3,71

1,93

)

6,355,85

Structure

1,634,

658

(

820,896

)

813,762

1,497,95

(

735,703

)

762

,248

Machine

ry a

nd equi

pment

17,54

2,258

(10,884,

908)

6,657,

350

16,517,625

(9,848,680)

6,668,94

Vehicl

473,053

(

219,202

)

253,851

396,899

(

191,797

)

205

,102

Dies, m

lds an

d tools

14,310,8

(

9,89

9,71

)

4,411,102

12,

532,468

(

8,69

5,19

)

3,837,27

Office e

ment

1,926,

607

(

1,50

2,05

)

424,549

1,772,09

(

1,38

6,33

)

385

,763

Other

309,4

(

102,861

)

206,618

162,951

(

87,32

)

75,623

Construc

tion

in pr

ogress

3,882,

050

3,8

82,050

3,754,415

3,754,

415

୸

63,08

1,114

୸

(27,53

8,031)

୸

35,54

3,083

୸

58,74

9,198

୸

(24,65

6,969)

୸

34,09

2,229

(*)

Accumul

ated imp

airment losses are i

ncluded

(2)

The changes in P

P&E for the

year ended Decembe

r 31, 2021 are as foll

ows.

Descri

tion

Beginn

ing

of the

ear

uisiti

ons

Tran

sfer

within P

P&E

Dis

osals

reciat

ion

Others

(

)

End of

the

ear

Land

୸

12,0

47,0

୸

68,9

୸

39,2

୸

(1,303)

୸

(23,

879)

୸

12,1

30,0

Buildi

6,355,85

39,130

626,269

(

3,46

)

(

328,58

)

74,49

763,707

Struct

ures

762,248

27,774

103,295

(14,823)

(68,50

3,768

813,762

Mach

inery

and

equi

pment

6,668

,945

28,8

922,

091

(31,

931)

(1,010,

082)

79,4

6,657

,350

Vehicl

205,

102

84,1

82,

730

(

51,161

)

(

61,111

)

(

5,81

)

253,851

Dies

, molds

and t

ools

3,837

,278

27,7

1,792

,988

(18,

308)

(1,292,

982)

64,4

4,411

,102

Office e

ment

385,

763

61,338

130,04

(

1,91

)

(

157,61

)

6,92

424,54

Others

75,623

8,45

147,23

(23,57

(13,6

50)

12,531

206,618

Constr

uction-in

-progr

ess

3,754

,415

4,036

,440

(3,843,

940)

(451)

(64,

414)

3,882

,050

୸

34,0

92,2

୸

4,382

,774

୸

(146,

928)

୸

(2,932,

516)

୸

147,

524

୸

35,5

43,0

(*)

Others includ

e the effect o

f foreign exch

ange differen

ces, transfers fro

m or to other acco

unts, i

mpairment loss o

୸

44,

499 milli

allocate

d from the

impairment of

CGU attributa

ble to H

undai

k & Bus(

China

) Co.

, Ltd. a

nd ot

hers. The r

ecove

rable

amount o

CGU attributa

ble to Hyun

dai Truck & Bus(Chi

a) Co.,

Ltd. was b

sed on

its value in us

e or

fair

value le

ss cos

ts to dis

posal(net

fair

value),

and the di

scount rate app

lied to the measu

rement o

f value in use is 8

.7%.

The changes in PP&E for t

e year ende

d December 31

, 2020 are as

follows.

Descri

tion

Beginn

ing

of the

ear

uisiti

ons

Tran

sfer

within P

P&E

Dis

osals

reciat

ion

Transf

er to

asset

classifi

ed as

eld fo

r sale

Others

(

)

End of

the

ear

(

In mil

lions o

f Korean W

)

Land

୸

12,0

39,4

୸

28,94

୸

98,96

୸

(39,

754)

୸

(65,

287)

୸

(15,

332)

୸

12,0

47,0

Build

ings

,229,

826

425

453,7

(23

,812)

(

308

,194)

(12

,504)

7,406

6,355

,852

Struct

ure

749,57

12,9

77,4

(

3,99

)

(

66,178

)

(

519

)

(

7,01

)

762,24

Mach

inery

and

equi

pment

6,534

,417

10,81

1,347

,753

(70,

689)

(1,002,

135)

(408)

(150,

805)

6,668

,945

Vehicl

198,330

37,379

89,552

(

49,189

)

(

58,213

)

(

)

(

12,695

)

205,10

Dies

, molds

and t

ools

3,034

,610

7,060

1,998

,356

(

11,715

)

(

1,12

2,39

)

(

5,15

)

(

63,481

)

3,837

,278

Office equi

pment

415,

173

37,533

112,

808

(1,292)

(161,624

)

(8,398)

(8,437)

385,

763

Others

43,317

31,310

32,849

(

2,07

)

(

20,445

)

(

)

(

9,28

)

75,623

Constr

uction-in

res

3,586

,808

4,495

,312

(

4,21

1,39

)

(

742

)

(

115,57

)

3,754

,415

୸

32,8

31,5

୸

4,670

,748

୸

(203,

257)

୸

(2,739,

185)

୸

(92,

387)

୸

(375,

214)

୸

34,0

92,2

(*)

Others in

clude th

e effect of foreign exch

ange differences,

transfers from o

r to other accoun

ts and impair

ment losses an

d ot

hers.

ڏڍٻ

10. INVESTMENT

PROPERTY:

(1)

Investment pr

operty as

of December 3

1, 2021 and Decembe

r 31, 2020 are as foll

ows.

December 31, 2021

December 31

, 2020

Description

Acquisition

cost

Accumulated

depreciation

Book

value

Acquisition

cost

Accumulated

depreciation

Book

value

(In millions of Korean Won)

Land

୸

54,284

୸

54,284

୸

56,046

୸

56,046

Buildi

ngs

313,777

(221,919)

91,858

298,673

(204,673

)

94,000

Structures

18,630

(8,116)

10,514

18,630

(7,709)

10,921

୸

386,691

୸

(230,035

)

୸

156,656

୸

373,349

୸

(212,382

)

୸

160,967

(2)

The changes in inves

tment pro

erty for the

year ended Dece

mber 31, 2021 a

re as follows:

Description

Beginni

of the year

Disposals

Transfers(*)

Depreciation

Effect of foreign

exchange

differences

End of

the year

(In millions of Korean Won)

Land

୸

56,046

୸

(1,762)

୸

54,284

Buildi

ngs

94,000

1,537

(4,990)

1,311

91,858

Structures

10,921

(408)

10,514

୸

160,967

୸

(1,762)

୸

1,537

୸

(5,398)

୸

1,312

୸

156,656

(*) Transferred amount fro

Constru

ctio

n-in-

progre

The changes in In

vestment pr

operties for t

he year ended December 31, 2020 a

re as follows.

Description

Beginni

of the year

Transfers(*)

Depreciation

Effect of foreign

exchange

differences

End of

the year

(In millions of Korean Won)

Land

୸

56,046

୸

56,046

Buildi

ngs

104,118

(9,920)

(208)

94,000

Structures

11,330

(408)

(1)

10,921

୸

171,494

୸

(10,328)

୸

(209)

୸

160,967

(*) Transferred amount fro

Constru

ctio

n-in-

progre

(3)

The fair value of Inves

tment p

roperties as of Decembe

r 31, 2021 an

d December 31

, 2020 are as

follows.

Description

December 31, 2021

December 31, 20

(In millions of Korean Won)

Land

୸

54,28

୸

56,046

Buildings

338,579

315,854

Structures

15,496

୸

408,35

୸

387,396

The fair value measureme

t of the Investment

properties was

performed by an

independent third part

y. The Group deems

the change in fair value from the fair value measurement pe

rformed at the initial recognition of

the Investment properties

is not material.

The fair value of the Inves

tment prope

ties is classified as Le

vel 3, based on t

he inputs

used in the valuati

on techni

ques.

The fair value has been d

etermined base

d o

n the cost appr

oach and the market

approach

. The cost appr

oach measure

fair value as current

replacement cost considering building st

ructures and

design, su

pplement

ary installation, dep

eciation

period.

ڏڎٻ

(4) Income and expenses relat

ed to Invest

ment pro

perties for t

he years ende

d December

31, 2021 an

d 2020 a

re as

follows.

Description

2021

2020

n millions of Korean Won)

Rental income

୸

47,71

୸

49,536

Operating and maint

enance ex

penses

3,265

17,141

11. I

NTANGI

BLE AS

SETS:

(1)

Intangible assets as

of December 31, 20

21 and Decembe

r 31, 2020 are

as follows.

December 31, 2021

December 31, 2020

Description

Acquisition

cost

Accumulated

amortization (

Book

value

Acquisition

cost

Accumulated

amortization (

Book

value

(In millions of Korean Won)

Goodwill

୸

409,570

୸

(35,807)

୸

373,763

୸

377,015

୸

(35,539)

୸

341,476

Development

costs

10,374,450

(6,331,957)

4,042,493

9,957,047

(5,679,376)

4,277,671

Industria

property rig

hts

477,280

(338,071

)

139,209

447,109

(201,709

)

245,400

Software

1,567,846

(1,089,9

90)

477,856

1,397,880

(978,779)

419,101

Others

821,000

(189,077

)

631,923

486,459

(235,196)

251,263

Const

ruction in

progress

197,278

(15,536)

181,742

146,890

(4,234)

142,656

୸

13,847,424

୸

(8,000,438)

୸

5,846,986

୸

12,812,400

୸

(7,134,833)

୸

5,677,567

(*)

Accu

mulated

impairmen

t losses are in

cluded.

(2)

The changes in intangi

ble

assets

for the year ende

d December 31,

2021 are as f

ollows.

Description

Beginni

of the year

Internal

developments

External

acquisition

Transfers

within

intangib

assets

Disposals

(In millions of Korean Won)

Goodwill

୸

341,476

୸

Development

Costs

4,277

,671

1,291,676

31,28

41,147

(417)

Industria

property

rights

245,4

951

28,076

(152)

Software

419,101

8,531

41,316

32,113

(110)

Others

251,263

1,150

21,771

(18,662)

Construct

ion in progres

142,6

11,124

171,226

(123,107)

୸

5,677,567

୸

1,311,395

୸

245,930

୸

(19,341)

Description

Amortizatio

Impairment l

oss

/reversal (*1)

Transfer to Non-

current assets

classified as held

for sale

Others

(*2)

End of

the year

(In millions of Korean Won)

Goodwill

୸

(76,805)

୸

109,092

୸

373,763

Development

Costs

(1,406,713)

(192,213)

(3,496)

3,551

4,042

,493

Industria

l property

rights

(24,076)

(112,

278)

1,224

139,209

Software

(158,353)

(4)

135,262

477,856

Others

(28,681)

(162)

405,238

631,923

Construct

ion in progres

(12,853)

(7,304)

181,742

୸

(1,617,823)

୸

(394,147

)

୸

(3,658)

୸

647,063

୸

5,846,986

(*1) Impa

irment los

ses incl

ude impairm

ent of devel

opment costs due t

o the disco

ntinued

sales and de

velopment projec

ts,

impairme

loss of

୸

246,70

millio

n allocated from

the impairment of

CGU attribut

ble to Hyunda

i Truck &

Bus(China)

Co.,

Ltd. an

d others.

ڏڏٻ

(*2) Others

include

the eff

ect of

foreign e

xchange dif

fere

nces

, tra

nsfer

s fr

om or

other a

ccounts, cha

nges in t

he sco

pe of co

nsolida

tion

and ot

hers.

The changes in intangi

ble assets

for the ye

ar ende

d December 31,

2020 are as f

ollows.

Description

Beginni

of the year

Internal

developments

External

acquisition

Transfers

within

intangib

assets

Disposals

(In millions of Korean Won)

Goodwill

୸

261,525

୸

Development

Costs

4,076

,343

1,532,411

25,07

35,848

(4,306)

Industria

property

rights

133,2

153

1,579

25,032

(610)

Software

317,989

7,827

38,409

129,436

(1,072)

Others

249,948

10,16

4,189

(2,217)

Constr

uction

progress

227,4

48,189

64,514

(194,505)

୸

5,266,496

୸

1,588,580

୸

139,738

୸

(8,205)

Description

Amortizatio

Impairment l

oss

(*1)

Transfer to Non-

current assets

classified as held

for sale

Others

(*2)

End of

the year

(In millions of Korean Won)

Goodwill

୸

79,951

୸

341,476

Development

Costs

(1,244,996)

(187,580)

(58,341)

103,222

4,277,671

Industrial

property

rights

(25,261)

(2,680)

113,912

245,400

Software

(154,890)

(42)

(9,975)

91,419

419,101

Others

(10,713)

(339)

(752)

981

251,263

Construct

ion in progres

(1,56

(50)

(1,341)

142,656

୸

(1,435,860)

୸

(189,528

)

୸

(71,798)

୸

388,144

୸

5,677,567

(*1) Im

pairment losse

s were

recognized f

or deve

lopme

nt costs

due to the dis

conti

nued s

ales

and de

velopm

ent proje

cts

for the year end

ed December 31, 20

20.

(*2) Others i

nclude the effect o

f foreign ex

change

differences and

transfer from o

r to other accounts an

d others.

(3) Development cost

s of intangible assets

of December 31, 2021 c

onsist of as follows.

Descript

ion

Book

value

Remaining

amortizat

ion

period

(*)

(In millio

ns of

Korean Won)

Automobile

Developing

୸

1,176,530

Amo

rtizing

2,378,965

months

Powertrain

Developing

142,567

Amor

tizing

171,828 25

months

Others

Developi

Amor

tizing

172,549 46

months

୸

4,042,493

(*)

ince th

e remaining amo

rtization perio

d differs for each p

roject, the weight

ed average remai

ning useful l

ives of the develo

pment

costs a

t the en

d of reportin

g period are

disclosed.

ڏڐٻ

Development costs of i

ntangibl

e assets

as of December 31, 2020 co

nsist of as follows

Descript

ion

Book value

Res

idual useful lives (*

)

(In

millions of

Korean Won)

Automobile

Developing

୸

1,609,463

Amo

rtizing

2,145,937

months

Powertrain

Developing

109,467

Amo

rtizing

236,310 29

nths

Others

Developing

190

Amo

rtizing

176,304 42

nths

୸

4,277,671

(*)

ince th

e remaining amo

rtization perio

d differs for each p

roject, the weight

ed average remai

ning useful l

ives of the develo

pment

costs a

t the en

d of reportin

g period are

disclosed.

(4)

esearch and development e

xpenditures f

or the y

ears ende

d December 31, 2

021 and

2020 are as follows

Description

2021

2020

n millions of Korean Won)

Development c

sts

(intangible

assets)

୸

1,322,963

୸

1,557,481

Research and devel

opment c

ost

s (*1)

1,774,934

1,539,580

Total (*2)

୸

3,097,897

୸

3,097,061

(*1)

Presented in m

anufac

turing costs

, administrati

ve expense

(*2)

Amortization of

deve

lopme

nt cos

ts is not

include

(5)

Impairment test of

goodwill

The allocation of goodwill am

ongst the Group’s C

GUs as of D

ecember 31, 2

021 and December 3

, 2020 a

re as follows.

Segment

December 31, 2021

December 31, 2020

(In millions of Korean Won)

Vehicle

୸

253,204

୸

240,514

Finance

482

Others

120,077

100,480

୸

373,763

୸

341,476

The recoverable amounts

of the Group’s

CGUs are measured

as t

heir value-in-us

e calcula

ted based on cas

h flow

projections of

financial budget

s for the next five years

approved by management.

The pre-tax disc

ount rate appl

ied

to the cash flow

projections for the years

ended December

31, 2021 and 2020, are

8.7% and 11.9% respecti

vely.

Cash flow

projections beyo

nd the five-yea

r period are extra

polated by us

ing the esti

mated growth rat

e which does

not exceed the

long-term average gr

owth rate

of the

region a

nd industry to w

hich the C

GU belongs

. An impairment

loss on goodwill of

୸

76,805 million has been re

cognized with respect to th

e impairment of CGU attr

ibutable to

Hyundai Truck & B

us(China

) Co., Ltd. fo

r the year ende

d December 31, 2021.

No impairment loss had bee

recognized for

the year ende

d December 31

, 2020.

ڏڑٻ

12. LEASES (A

S A LESS

EE):

(1)

The chan

ges in right

-of-use assets for t

he year ended Decem

ber 31, 2021 are

as follows.

Description

Beginni

of the year

Acquisition

Disposals

Depreciation

Others(*)

End of t

he year

Land

୸

143,679

୸

13,863

୸

(457)

୸

(6,686)

୸

(66,795)

୸

83,604

Building

681,335

249,691

(22,786)

(184,173

)

30,082

754,149

Structures

2,672

1,566

(78)

(1,84

2,370

Others

8,638

97,885

(854)

(8,722)

3,756

100,703

୸

836,324

୸

363,005

୸

(24,175)

୸

(201,426

)

୸

(32,902)

୸

940,826

(*)

Others in

clude th

e effect of foreign ex

change di

fferences, impair

ment loss of

୸

46,910 million a

lloca

ted from the im

pairment

CGU

attributable

to Hyunda

i Tru

ck & Bus

(China

) Co., Lt

d. and othe

rs.

The changes in right-of-

use ass

ets for the

year ended Decem

ber 31, 2020 are

as follows.

Description

Beginni

of the year

Acquisition

Disposals

Depreciation

Others(*)

End of t

he year

Land

୸

20,487

୸

4,323

୸

(1)

୸

(7,766)

୸

126,636

୸

143,679

Building

689,563

221,356

(45,158)

(173,087

)

(11,3

39)

681,335

Structures

3,087

2,086

(218)

(2,080)

(203)

2,672

Others

21,405

9,595

(12,944)

(9,418)

8,638

୸

734,542

୸

237,360

୸

(45,377)

୸

(195,877

)

୸

105,676

୸

836,324

(*)

Others in

clude the effect

of foreign exchang

e differences and

others.

(2)

Lease liabilities as of

December 31, 2021 and December 31, 2020 are as follows.

Description

December 31, 20

December 31, 2020

(In millions of Korean Won

)

Undiscoun

ted lease liabilities

୸

1,150,757

୸

943,470

Discounted lease liab

ilities

950,572

757,044

Current

167,266

141,478

Non-current

783,306

615,566

(3)

Expenses recognized in

relation to leases for th

years ended

December 31, 2021 and 202

0 are as follows.

Description

December 31, 2021

December 31, 2020

(In millions of Korean Won)

Interest on

lease liabilities

୸

25,126

୸

30,580

Expenses in relat

ion to l

eases of short

-term and

low-

value assets

20,907

21,342

ڏڒٻ

13.

INVESTM

ENTS IN JOINT

VENTURES AND ASSOCI

ATES:

(1)

Investments in joint ve

ntures and as

soci

ates as of December

31, 2021 are as follows.

Name of the company

Nature of

business

Location

Ownership

percentage

Book value

(%)

(In millio

ns of

Korean Won)

Beiji

ng Hyundai Qiche F

inancing

Company (BHAF

) (*1,3)

Financing

China

53.00

୸

736,704

Beijing-Hyundai Motor C

ompany

(BHMC) (*

Manufacturing

China

50.00

345,950

Hyundai WIA A

utomotive En

gine

(Shandong) C

ompany (W

AE)

Manufacturing

China

31.40

245,868

Motional AD LLC

(*1)

R&D

25.97

1,025,263

Boston Dynami

cs, Inc.

R&D

USA

30.00

414,634

Hyundai Capi

tal B

ank Europe

GmbH

(HCBE)

Financing

Ger

man

49.00

498,050

Kia Corporation

(*4)

Manufacturing

Korea

33.88

11,620,132

Hyundai Engi

neering & C

onst

ruction

Co., Ltd.

Construction

Korea

20.95

2,935,786

Hyundai Trans

ys Inc.

Manufacturing

Korea

41.13

1,085,858

Hyundai WIA C

orporation

Manufacturing

Korea

25.35

729,053

Hyundai Autoe

ver Corp. (*

IT service

Korea

31.59

410,935

Hyundai Comme

rcial Inc.

Financing

Korea

37.50

339,300

Hyundai Motor Securities C

o., Ltd.

Securities

Brokerage

Korea

25.43

314,532

Eukor Car Carri

ers Inc. (*

Transportati

Korea

12.00

186,489

Haevichi Hote

ls & Res

orts Co., Ltd.

Hotelkeeping

Korea

41.90

98,894

Others

1,441,669

୸

22,429,117

(*1)

Each of the joint arran

ements in

which the Group reta

ins

joi

nt control is str

uctured thr

ugh a se

parate entity

and there

are no

contractual te

rms stating t

at the

parties retain ri

ghts to th

e assets and

obligati

ons for the liabilitie

s relating

to the j

oin

arrangemen

t or other relev

ant facts and circu

mstances. As a result

, the Group consid

ers that the parties th

at retain joint co

trol

in the arrang

ement have ri

ghts to the net

assets and classi

fies the joint arrang

ements as jo

int ventu

res. Also, there are

restri

ctions, w

hich req

uire co

nsen

t from t

he direc

tor w

ho is des

igna

ted by t

e othe

r investors, f

r cer

tain tr

ansac

tions, suc

payme

nt of di

vidend.

(*2)

As the G

roup is c

onsidere

d to be

able

to exerci

se sig

ificant

influence by re

presentatio

n on the b

oard of director

s of t

investe

e and

other

reas

ons, alt

gh the t

otal ownership

percentage

is les

s than 20

%, the inves

tment i

s accounted f

r us

ing the

equity m

ethod.

(*3)

The entity is c

ateg

orized as a joi

nt vent

ure although

the G

roup’s

total ow

nershi

p percentage

is a majority s

hare

of 53%

, b

ecause

the G

roup does

not ha

ve co

ntrol o

ver the e

ntity b

virtue

of a

n agre

eme

nt with the ot

her investors

(*4) During t

he year ended

December 31

, 2021, the n

ame of the compan

y was chang

ed from Kia Moto

rs Corporation

to Kia

Corporation.

(*5) During t

he year ended

December 31

, 2021, as the merg

er with Hyundai

Autron Comp

any Ltd., th

e subsid

iary of the Comp

any,

and HYUNDAI MNSOFT, In

c.,

the as

sociate of the

Compan

y, was c

omplete

d, the

Group’s

ownership percentage

was chan

ged

from 28.4

8% to 31.59%.

ڏړٻ

Investments in joint ventures a

nd associates

of December 31, 2020 a

e as follows.

Name of the company

Nature of

business

Location

Ownership

percentage

Book value

(%)

(In millio

ns of

Korean Won)

Beijing-Hyundai Motor C

ompany

(BHMC) (*

Manufacturing

China

50.00

୸

779,958

Beiji

ng Hyundai Qiche F

inancing

Company (BHAF

) (*1,3)

inancing

China

53.00

627,895

Hyundai WIA A

utomotive En

gine

(Shandong) C

ompany (W

AE)

Manufacturing

China

31.40

224,979

Motional AD LLC

(*1,4)

R&D

USA

26.00

1,053,282

Hyundai Capi

tal B

ank Europe

GmbH

(HCBE)

nancing

Ger

man

49.00

495,999

Kia Motors C

orporation

Manufacturing

Korea

33.88

9,972,824

Hyundai Engi

neering & C

onst

ruction

Co., Ltd.

Construction

Korea

20.95

2,835,399

Hyundai Trans

ys Inc.

Manufacturing

Korea

41.13

1,017,906

Hyundai WIA C

orporation

Manufacturing

Korea

25.35

694,991

Hyundai Motor Securities C

o., Ltd.

Securities

brokerage

Korea

27.49

310,472

Hyundai Comme

rcial Inc.

Financing

Korea

37.50

261,601

Eukor Car Carri

ers Inc. (*

Transportation

Korea

12.00

150,503

Hyundai Autoe

ver Corp.

IT service

Korea

28.48

158,073

Haevichi Hote

ls & Res

orts Co., Ltd.

Hotelkeeping

Korea

41.90

97,655

Others

1,243,723

୸

19,925,260

(*1)

Each of the joint arran

ements in

which the Group reta

ins

joi

nt control is str

uctured thr

ugh a se

parate entity

and there

are no

contractual te

rms stating t

at the

parties retain ri

ghts to th

e assets and

obligati

ons for the liabilitie

s relating

to the j

oin

arrangemen

t or other relev

ant facts and circu

mstances. As a resul

t, the Group consid

ers that the parti

es that retain joint con

rol

in the arrang

ement have ri

ghts to the net

assets and classi

fies the joint arrang

ements as j

oint ventu

res. Also, there are

restri

ctions, w

hich req

uire co

nsen

t from t

he direc

tor w

ho is des

igna

ted by t

e othe

r investors, f

r cer

tain tr

ansactio

ns, such

payme

nt of di

vidend.

(*2)

As the G

roup is c

onsidere

d to be

able

to exerc

ise si

gnifica

nt infl

uence

by repr

esenta

tion on t

e boa

rd of dir

ectors

of t

investe

e and

other

reas

ons, alt

gh the t

otal ownership

percentage

is les

s than 20

%, the inves

tment i

s accounted f

using the

equity m

ethod.

(*3)

The entity is c

ateg

orized a

s a joi

nt vent

ure although

the G

roup’s

total ow

nershi

p percentage

is a m

ajority s

hare

of 53%,

ecause

the G

roup does

not ha

ve co

ntrol o

ver the e

ntity b

virtue

of a

n agre

eme

nt with the ot

her investors

(*4) During t

he year ended

December 31

, 2020, the name o

f the company was ch

anged fro

m Hyundai-Apt

iv AD LLC to Motion

AD LLC.

ڏڔٻ

(2)

The changes in investments in

joint ventures and ass

ciates for the year ended Decembe

r 31, 2021 are as follows.

Name of the company

Beginning of

the ye

Acqui

sitio

(disposals)

profits (losses)

for the period

Dividends

Oth

ers (*

End of th

e yea

(In millions of Korean Won)

BHAF

୸

627,895

୸

50,724

୸

(15,880)

୸

73,965

୸

736,704

BHMC

779,958

(502,344)

68,336

345,950

WAE

224,979

(3,432)

24,321

245,868

Motional

LLC

1,053,282

(122,871)

94,852

1,025,26

Boston

Dynamics,

Inc.

(*2)

431,882

(36,0

10)

18,762

414,634

HCBE

495,999

(99)

2,150

498,050

Kia

Corporation

9,972,824

1,601,473

(137,318)

183,153

11,620,1

Hyundai Engi

neering &

Construct

ion

Co.,

Ltd.

2,835,399

82,421

(13,996)

31,962

2,935,78

Hyundai

Transys

Inc.

1,017,90

39,223

28,729

1,085,858

Hyundai

WIA

Corporation

694,991

16,637

(4,826)

22,251

729,053

Hyundai

Autoever

Corp.

158,073

24,876

(4,485)

232,471

410,935

Hyundai

Commercial

Inc.

261,601

67,187

(3,750)

14,262

339,300

Hyundai Motor Securities

Co., Ltd.

310,472

23,027

(5,444)

(13,523)

314,532

Eukor Car Carri

ers Inc.

150,503

22,457

13,529

186,489

Haevichi Hotels & Reso

rts

Co.,

Ltd.

97,655

980

259

98,894

Others

1,243,723

208,988

14,34

(12,344)

(13,040)

1,441,669

୸

19,925,260

୸

640,870

୸

1,278,591

୸

(198,043

)

୸

782,439

୸

22,429,117

(*1)

Oth

ers consist

of changes in accu

mulated o

ther compreh

ensive income (l

oss) and oth

ers.

(*2)

are acqui

sition has been co

mpleted in

the year ended

December 31

, 2021, and the acq

uisit

ion cost is measured

as the cash

paid

during

the curren

t year, ca

sh tha

t will be

paid in the followin

g year, and t

he value of

put opti

on owned by o

ther i

nvestors

ڐڋٻ

The changes in invest

ments in joint ventures

and a

ssociates for the yea

r ended Decembe

r 31, 2020 are

follows.

Name of the company

Beginning of

the ye

Acqui

sitio

(disposals)

profits (losses)

for the period

Dividends

Others (*1)

End o

f the ye

(In millions of Korean Won)

BHMC

୸

1,256,925

୸

(498,581

)

୸

21,614

୸

779,958

BHAF

577,810

46,908

3,177

627,895

WAE

154,136

76,683

(6,077)

237

224,979

Motional AD

LLC(*2)

1,294,367

(99,103)

(141,982)

1,053,282

HCBE

159,948

330,158

1,219

4,674

495,999

Kia Motors C

rporation

9,655,017

505,155

(157,916)

(29,432)

9,972,824

Hyundai Engi

neering &

Construct

ion Co., Ltd.

2,859,169

2,166

(13,997)

(11,939)

2,835,39

Hyundai Trans

ys Inc.

1,026,56

(3,269)

(5,388)

1,017,90

Hyundai WIA C

rporati

682,526

20,022

(4,826)

(2,731)

694,9

Hyundai Motor Securities

Co., Ltd.

283,446

29,156

(4,839)

2,709

310,472

Hyundai Comme

rcial Inc.

255,800

43,937

(38,136)

261,601

Eukor Car Carri

ers Inc.

173,212

(13,300)

(9,409)

150,503

Hyundai

Autoe

ver

Corp.

145,076

16,808

(4,246)

435

158,073

Haevichi Hotels & Reso

rts

Co.,

Ltd.

101,578

(2,802)

(1,121)

97,655

Others

1,044,084

164,664

61,437

(14,707)

(11,755)

1,243,723

୸

18,375,290

୸

1,865,872

୸

103,676

୸

(200,531

)

୸

(219,047

)

୸

19,925,260

(*1) O

thers c

onsist of cha

nges in a

ccum

ulated othe

r com

rehe

nsiv

e income (loss

) an

d other

(*2) The

joint ve

nture

was inc

rpor

ated

during t

he year e

nded D

ece

mber 31, 20

20, and the a

cqui

sition cost

is m

eas

ured as

the fa

value of

paid c

ash, co

ntributed pa

tent lice

nses and

the provision

of service

s in exchan

ge for the shar

of the joi

nt venture

(3)

Summarized fina

ncial info

rmation of t

he Grou

p’s major j

oint ventures

and ass

ociates as of and fo

r the year

ended December 31, 2021 is as

follows.

Name of the company

Current

assets

Non-current

assets

Current

liabilities

Non-current

liabilities

(In millions of Korean Won)

BHAF (*)

୸

5,648,345

୸

4,258,337

୸

BHMC

2,877,226

3,897,225

5,047,580

984,476

WAE

648,858

530,099

185,159

255,961

Motional AD LLC

630,770

3,603,314

97,631

105,139

Boston D

ynamics, Inc.

117,854

250,999

55,254

79,823

HCBE

(*)

6,910,165

5,916,354

Kia

Corporation

29,205,483

37,644,514

21,562,636

10,374,805

Hyundai Engi

neering &

Construct

ion Co., Ltd.

14,555,535

5,091,172

7,616,041

2,594,756

Hyundai Trans

ys Inc.

3,592,986

3,043,732

2,164,191

1,786,510

Hyundai WIA C

orporation

4,156,48

3,593,022

2,126,275

1,927,968

Hyundai Autoe

er Cor

1,471,052

875,071

721,374

248,927

Hyundai

Commercial

Inc.

(*)

10,001,066

8,699,018

Hyundai Motor Securities C

o., Ltd. (*)

8,806,12

7,645,41

Eukor Car Carri

ers Inc.

534,0

3,169,325

654,912

1,467,44

Haevichi Hot

els & Re

sorts C

o., Ltd.

44,922

409,187

235,954

44,458

ڐڌٻ

Name of the company

Sales

Profit (loss) for

the period from

continuin

operations

Other

comprehensi

income (loss)

Total

comprehensi

income (loss)

(In millions of Korean Won)

BHAF (*)

୸

423,416

୸

95,703

୸

95,703

BHMC

6,240,989

(1,012,9

33)

(1,012,933)

WAE

797,685

(4,226)

Motional AD

LLC

949

(516,204)

(5,025)

(521,229)

Boston D

ynamics, Inc.

66,779

(196,950)

HCBE

(*)

711,616

(325)

4,241

3,916

Kia

Corporation

69,862,366

4,760,311

664,223

5,424,534

Hyundai Engi

neering &

Construct

ion Co., Ltd.

18,065,534

549,501

168,103

717,604

Hyundai Trans

ys Inc.

8,143,951

90,623

66,409

157,032

Hyundai WIA C

orporation

7,527,73

56,071

131,926

187,9

Hyundai Autoe

ver Corp.

2,070,382

71,368

13,648

85,016

Hyundai Comme

rcial Inc.

(*)

482,087

185,303

(31,808)

153,495

Hyundai Motor Securities C

o., Ltd. (*)

853,770

117,749

913

118,662

Eukor Car Carri

ers Inc.

1,894,623

192,229

137,672

329,901

Haevichi Hot

els & R

esorts C

o., Ltd.

116,466

2,063

2,079

(*)

The companies operate

financ

ial business a

nd their to

tal asse

ts (liabilities) are inc

lude

d in current a

ssets (liabilities)

as the compan

ies

do not

disting

uish c

urrent

and no

n-curre

nt por

tion i

n their

separa

te financial sta

teme

nts.

Summarized financial info

rmati

on of the Grou

p’s major j

oint ventures

and ass

ociates as of and fo

r the year

ended December 31, 2

020 is as

follows.

Name of the company

Current

assets

Non-current

assets

Current

liabilities

Non-current

liabilities

(In millions of Korean Won)

BHMC

୸

4,213,182

୸

4,178,661

୸

6,050,736

୸

722,467

BHAF

(*)

6,077,427

4,892,720

WAE

577,626

640,138

273,051

279,354

Motional AD LLC

1,618,551

2,681,753

70,266

76,808

HCBE

(*)

5,635,284

4,648,027

Kia Motors C

orporation

26,093,382

34,397,061

21,097,5

9,501,182

Hyundai Engi

neering &

Construct

ion Co., Ltd.

13,341,687

4,540,331

6,410,469

2,705,171

Hyundai Trans

ys Inc.

3,279,222

2,747,382

2,200,265

1,381,699

Hyundai WIA C

orporation

3,987,96

3,731,941

1,985,718

2,208,328

Hyundai Motor Securities C

o., Ltd (*)

9,167,903

8,102,116

Hyundai Comme

rcial Inc.

(*)

9,369,11

8,075,65

Eukor Car Carri

ers I

nc.

318,448

2,849,023

524,472

1,390,993

Hyundai Autoe

er Cor

797,280

279,747

417,384

97,262

Haevichi Hot

els & Re

sorts C

o., Ltd.

37,870

412,409

219,589

59,072

ڐڍٻ

Name of the company

Sales

Profit (loss) for

the period from

continuin

operations

Other

comprehensi

income (loss)

Total

comprehensi

income (loss)

(In millions of Korean Won)

BHMC

୸

6,872,866

୸

(1,152,001)

୸

(1,152,001)

BHAF

(*)

229,501

88,503

WAE

962,901

(41,366)

Motional AD

LLC

645

(231,530)

(16)

(231,546

)

HCBE

(*)

540,080

5,216

8,080

13,296

Kia Motors C

rporation

59,168,096

1,487,585

(112,980)

1,374,605

Hyundai Engi

neering &

Construct

ion Co., Ltd.

16,970,859

227,697

(90,687)

137,010

Hyundai Trans

ys Inc.

7,253,615

(5,164)

(9,813)

(14,977)

Hyundai WIA C

orporation

6,592,24

53,672

(22,193)

31,479

Hyundai Motor Securities C

o., Ltd. (*)

839,993

84,299

13,792

98,091

Hyundai Comme

rcial Inc.

(*)

440,093

122,554

9,828

132,382

Eukor Car Carri

ers Inc.

1,292,324

(110,202)

(77,690)

(187,892)

Hyundai Autoe

er Cor

1,562,593

60,786

1,494

62,280

Haevichi Hot

els & Re

sorts C

o., Ltd.

91,780

(5,683)

(654)

(6,337)

(*)

The companies opera

te fina

ncial busine

ss and t

heir total a

sets (liabilities) a

re include

d in current assets (liabilities)

as the compan

ies

do not

disting

uish c

urrent

and no

n-curre

nt por

tion i

n their

separa

te financial sta

teme

nts.

(4)

Summarized addi

tional fina

ncial information of t

he Grou

p’s maj

or joint vent

ures as of

and for the

year

ended December 31, 2

021 is as follows

Name of the

company

Cash an

cash

equivalents

Current

financial

liabilities

Non-current

financial

liabilities

Depreciation

and

amortization

Interest

income

Interest

expenses

Income tax

expense

(In millions of Korean Won)

BHAF(*)

୸

860,234

୸

3,993,580

୸

8,155

୸

419,195

୸

175,403

୸

32,648

BHMC

975,177

379,970

723,688

481,351

11,599

81,288

2,665

Motional AD

LLC

188,571

14,407

71,982

73,807

3,642

(7,875)

(*)

Operating financ

e business of

which to

l assets (lia

bilities) are inc

luded in current fina

ncial lia

bilitie

s as BHAF does n

ot distin

guish

current and n

on-current

portion in its separa

te financial sta

tements.

Summarized

additional financial informatio

n of the Group’s majo

r joint

ventures as of

and for the

year ended Decem

31, 2020 is as

follows

Name of the

company

Cash an

cash

equivalents

Current

financial

liabilities

Non-current

financial

liabilities

Depreciation

and

amortization

Interest

income

Interest

expenses

Income tax

expense

(In millions of Korean Won)

BHMC

୸

721,882

୸

634,448

୸

562,975

୸

478,859

୸

12,959

୸

88,336

୸

1,153

BHAF

(*)

1,513,718

4,603,376

7,156

428,836

185,578

29,937

Motional AD

LLC

1,577,353

9,756

60,970

43,646

1,739

(11,664)

(*)

Operating financ

e business of

which to

l assets (lia

bilities) are inc

luded in current fina

ncial lia

bilitie

s as BHAF does n

ot distin

guish

current and n

on-current

portio

n in its separate

financial sta

tements.

ڐڎٻ

(5)

Reconciliation

of the Group’s share of n

et assets of

the Group’s major join

t ventures and associates to their

carrying amount

s as of Dece

mber 31, 2021 is as foll

ows.

Name of the company

Group’s share

net asset

Goodwill

Unrealised

profit (loss

) and

others

Carrying

amounts

(In millions of Korean Won)

BHAF

୸

736,704

୸

736,704

BHMC

371,198

(25,248)

345,950

WAE

(*)

238,021

7,809

245,868

Motional AD LLC

1,047,834

(22,571)

1,025,263

Boston D

ynamics, Inc. (*

)

199,325

209,428

5,881

414,634

HCBE

474,523

22,341

1,186

498,050

Kia

Corporati

11,505,1

197,089

(82,110)

11,620,132

Hyundai Engi

neering & C

onst

ruction

Co., Ltd. (*)

2,204,424

731,362

2,935,786

Hyundai Trans

ys Inc.

1,070,93

14,927

1,085,858

Hyundai WIA C

rporati

823,381

(94,328)

729,053

Hyundai Autoe

er Corp. (*

)

352,013

58,822

100

410,935

Hyundai Comme

rcial Inc.

339,300

Hyundai Motor Securities C

o., Ltd.

275,563

40,052

(1,083)

314,532

Eukor Car Carri

ers Inc.

186,227

262

186,489

Haevichi Hot

els & Re

sorts C

o., Ltd. (*)

95,318

3,576

98,894

(*)

The difference betwe

en the c

arrying a

mount

and the fa

ir valu

of the

investee’s identi

fiable assets and liabilities a

s of t

acquisitio

date is incl

uded in the amou

nt of net asse

ts.

Reco

nciliation of

the Group’s share of ne

t assets of the Group’s major joint ventures and

associates to their carrying

amounts as of December 3

, 2020 is as follows

Name of the company

Group’s share

net assets

Goodwill

Unrealised

profit (loss

) and

others

Carrying

amounts

(In millions of Korean Won)

BHMC

୸

809,320

୸

(29,362)

୸

779,958

BHAF

627,895

WAE

(*)

217,132

7,809

224,979

Motional AD LLC

1,079,841

(26,559)

1,053,282

HCBE

472,534

22,341

1,124

495,9

Kia Motors C

orporation

9,857,162

197,089

(81,427)

9,972,824

Hyundai Engi

neering & C

onst

ruction

Co., Ltd. (*)

2,104,036

731,362

2,835,399

Hyundai Trans

ys Inc.

1,003,185

14,721

1,017,906

Hyundai WIA C

rporati

789,544

(94,553)

694,991

Hyundai Motor Securities C

o., Ltd.

271,503

40,052

(1,083)

310,472

Hyundai Comme

rcial Inc.

261,601

261,6

Eukor Car Carri

ers Inc.

150,241

262

150,503

Hyundai Autoe

ver Corp.

158,073

Haevichi Hote

ls & Res

rts C

o., Ltd. (*)

94,079

3,576

97,655

(*)

The difference betwe

en the c

arrying a

mount

and the fa

ir valu

of the

investee’s ide

ntifiable assets a

nd liabilitie

s as of t

he acqu

isition

date is incl

uded in the amou

nt of

net assets.

ڐڏٻ

(6)

The market price of majo

r listed equity s

ecurities as of

December 31, 2021 is as

follows.

Name of the company

Price per share

Total numbe

r of

Market

value

n millions of Korean Won

, except price per share)

Kia Corporation

୸

82,200

137,318,

251

୸

11,287,560

Hyundai Engi

neering & C

onst

ruction Co., Lt

44,450

23,327,400

1,036,903

Hyundai Autoe

er Corp.

138,000

8,664,334

1,195,678

Hyundai WIA C

orporation

79,900

6,893,596

550,798

Hyundai Motor Securities C

o., Ltd.

12,350

8,065,595

99,610

14. FINANCIAL SERV

ICES RECEIVA

BLES:

(1)

Financial services receivables

as of December

31,

2021 and

December 31, 2020 are as foll

ows.

Description

December 31,

2021

December 31,

2020

(In millions of Korean Won)

Loans

୸

61,959,509

୸

52,461,355

Card receivables

18,728,408

17,094,598

Financial lease receivables

2,123,47

2,429,420

Others

35,291

34,407

82,846,680

72,019,780

Loss all

owance

(1,551,987)

(1,685,229)

Loan originat

ion fee

(231,762)

(643,063)

Present val

ue discount acc

ounts

(33,799)

(26,278)

୸

81,029,132

୸

69,665,210

(2) Transfer of

financial services receivables

As of December 31, 2021 and

December 31, 2020, the Grou

p has

issued asset-b

acked securities with loan obligation

s for

which card receivab

les are underlying asse

ts and related

asset-backed securities hav

e the right of recour

se. As of

December 31, 202

1, the carrying amou

nt of fina

ncial ass

ets that

were transferred b

ut not derecogni

zed (includi

ng inter-

company bonds

) amou

nted to

୸

26,292,99

7 million and its fair value is

୸

26,213,213

million. The

carrying amount

related liabilities is

୸

19,352,363 m

illion and its

fair value is

୸

19,225,

190 million, thus, net pos

ition of fair value is

୸

6,988,023 million. As of D

ecember 31, 2020

, the carrying amount of financial as

sets that were transferred but not

derecognized (incl

uding i

nter-compan

y bonds) amounted t

୸

19,287,18

4 million and

its fair value is

୸

19,308,126

million. The car

rying amount of

related liabilities is

୸

13,918,870 million and its fair value is

୸

14,036,642 m

illion, thu

net position

of fair value is

୸

5,27

1,484 million.

ڐڐٻ

(3)

The changes in loss allowance

of fi

nancial services receivables

for the year

nded December 31, 2021 a

re as follows.

Loan

Obligations

12-Month

expected

credit losses

Lifetime

expected

credit losses

Description

Not Impa

ired

Impaired

Total loan

obligatio

(In millions of Korean Won)

Beginning o

f the year

୸

441,192

୸

300,082

୸

315,136

୸

1,056,410

Transfer to 1

2-Month expec

ted

credit losses

71,703

(67,049)

(4,654)

Transfer to lifetime expected

credit losses

(57,656)

61,633

(3,977)

Transfer to cre

dit-impaired

financial ass

ets

(2,773)

(5,866)

8,639

Impairment l

oss (reversa

(27,338)

128,7

135,156

236,587

Collection (wr

ite-off)

(114,

436)

(246,714)

(361,100

)

Dispos

als and others

234

Effect of foreig

n exchange

differences

24,029

13,292

214

37,535

End of the yea

୸

449,207

୸

316,425

୸

204,034

୸

969,666

Card

receivables

12-Month

expected

credit losses

Lifetime

expected

credit losses

Description

Not Impa

ired

Impaired

Total card

receivables

(In millio

ns of Korean Won)

Beginning o

f the year

୸

186,440

୸

142,390

୸

225,298

୸

554,128

Transfer to 1

2-Month expec

ted

credit losses

49,439

(49,287)

(152)

Transfer to lifetime expected

credit losses

(14,871)

15,045

(174)

Transfer to cre

dit-impaired

financial as

sets

(117,994

)

(56,471)

174,465

Impairment l

oss (reversal

)

120,496

111,716

99,160

331,372

Collection (wr

ite-off)

(332,434)

(332,

434)

Dispos

als and others

(27,801)

(2)

(11,563)

(39,366)

End of the yea

୸

195,709

୸

163,391

୸

154,600

୸

513,700

Others

Total

Allowances

12-Month

expected

credit losses

Lifetime

expected

credit losses

Description

Not Impa

ired

Impaired

Total others

n millions of Korean Won)

Beginning o

f the year

୸

18,032

୸

6,368

୸

50,291

୸

74,691

୸

1,685,229

Transfer to 1

2-Month expec

ted

credit losses

3,649

(1,461)

(2,18

Transfer to lifetime expected

credit losses

(1,879)

2,388

(509)

Transfer to cre

dit-impaired

financial as

sets

(144)

(233)

377

Impairment loss

(reversal)

(5,359)

1,057

(1,449)

(5,751)

562,2

Collection (wr

ite-off)

(319)

(693,853)

Dispos

als and others

(39,132)

Effect of foreig

n exchange

differences

37,535

End of the yea

୸

14,299

୸

8,119

୸

46,203

୸

68,621

୸

1,551,987

ڐڑٻ

The changes in allowance f

or doubtful

accounts

of financial

services receivables for the

year ended December 31,

2020 are as fol

lows.

Obligations

12-Month

expected

credit losses

Lifetime

expected

credit losses

Description

Not Impa

ired

Impaired

Total loan

obligatio

(In millions of Korean Won)

Beginning o

f the year

୸

356,282

୸

289,464

୸

319,719

୸

965,465

Transfer to 1

2-Month expec

ted

credit losses

64,127

(60,543)

(3,584)

Transfer to lifetime expected

credit losses

(23,721)

25,806

(2,085)

Transfer to cre

dit-impaired

financial ass

ets

(4,071)

(10,396)

14,467

Impairment l

oss (reversal

)

65,196

310,654

283,921

659,771

Collection (wr

ite-off)

(241,481

)

(148,399)

(389,875

)

Dispos

als and others

(31)

(4)

(148,693)

(148,728)

Effect of foreig

n exchange

differences

(16,595)

(13,418)

(210)

(30,223)

End of the yea

୸

441,192

୸

300,082

୸

315,136

୸

1,056,410

Card

receivables

12-Month

expected

credit losses

Lifetime expected

credit losses

Description

Not Impa

ired

Impaired

Total card

receivables

(In millio

ns of Korean Won)

Beginning o

f the year

୸

165,702

୸

145,892

୸

131,201

୸

442,795

Transfer to 1

2-Month expec

ted

credit losses

49,038

(48,900)

(138)

Transfer to lifetime expected

credit losses

(11,360)

11,48

(127)

Transfer to cre

dit-impaired

financial as

sets

(36,499)

(13,123)

49,622

Impairment l

oss (reversal

)

44,514

67,78

105,270

217,572

Collection (wr

ite-off)

(50,972)

Dispos

als and others

(24,9

55)

(20,754)

(9,558)

(55,267)

End of the yea

୸

186,440

୸

142,390

୸

225,298

୸

554,128

Others

Total

Allowances

12-Month

expected

credit losses

Lifetime

expected

credit losses

Description

Not Impa

ired

Impaired

Total others

n millions of Korean Won)

Beginning o

f the year

୸

15,508

୸

9,046

୸

47,741

୸

72,295

୸

1,480,555

Transfer to 1

2-Month expec

ted

credit losses

5,099

(2,647)

(2,45

Transfer to

lifetime expected

credit losses

(1,331)

2,228

(897)

Transfer to cre

dit-impaired

financial as

sets

(207)

(840)

1,047

Impairment l

oss (reversa

1,190

(598)

5,708

6,300

883,6

Collection (wr

ite-off)

(798)

(441,645)

Dispos

als and others

(2,227)

(821)

(58)

(3,106)

(207,101)

Effect of foreig

n exchange

differences

(30,223)

End of the yea

୸

18,032

୸

6,368

୸

50,291

୸

74,691

୸

1,685,229

ڐڒٻ

(4)

Gross investmen

ts in finan

cial leases and their presen

t value of minimu

m lease rece

ipts as of

December

31, 2021

and December 31,

2020 are as follows

December 31, 2021

December 31, 2020

Description

Gross

investm

ents

in financial

leases

Present value

of minimum

lease payment

receivable

Gross

investm

ents

in financial

leases

Present value

of minimum

lease payment

receivable

(In millio

ns of Korean Won)

Not later than one year

୸

888,358

୸

788,739

୸

979,318

୸

875,646

Later than one year and

not later

than

five

years

1,421,468

1,324,645

1,643,708

1,542,578

Later than five

years

6,475

6,236

6,908

6,691

୸

2,316,301

୸

2,119,620

୸

2,629,934

୸

2,424,915

(5)

Unearned interest income o

financial leas

es as of

December

31, 2021 and Decem

ber 31,

2020 are as

follows.

Description

December 31, 2021

December 31, 2020

(In millions of Korean Won)

Gross inv

estments in f

inancial lease

୸

2,316,301

୸

2,629,934

Net lease investments:

Present value of minimum lea

se payment receivable

2,119,620

2,424,915

Present value of

unguaranteed residual val

3,852

4,505

2,123,472

2,429

,420

Unearned interes

t income

୸

192,829

୸

200,514

15.

INVESTMENTS IN OPER

ATING LEASES (AS A LESSOR):

(1)

Investments in ope

rating leases

as of Decembe

r 31, 2

021 and December 31, 202

0 are as follows.

Description

December 31, 2021

December 31, 2020

(In millions of Korean Won)

Acquisition

cost

୸

29,980,884

୸

23,322,479

Accumulated de

preciation

(3,477,632)

(2,688,950)

Accumulated i

mpairment

loss

(175,256)

(131,838)

୸

26,327,996

୸

20,501,691

(2)

Future minimum lease payme

nt receivable related to inves

tments

in operatin

g leases as

of December 31, 2

021 and

December 31, 2020 i

s as foll

ows.

Description

December 31, 20

December 31, 2020

(In millions of Korean Won)

Not later than one year

୸

5,323,499

୸

4,091,315

Later than one year and

not later

than five years

5,744,91

4,454,173

Later than five years

୸

11,068,494

୸

8,545,488

ڐړٻ

16.

BORROWINGS AND DEBENTURE

(1)

Short-term borrowings

as of D

ecember 31, 2021 a

nd December 31, 20

20 are as follows

Description

Lender

Annual

interest rate

December 31,

2021

December 31,

2020

)

(In millions of Korean Won

)

Overdrafts

Citi

Bank and others

0.11~1.63

୸

456,044

୸

650,851

General bor

rowings

Korea Developme

nt Bank

and others

0.12~10.13

3,994,073

3,735,030

Borrowin

gs collateralized

by trade receivables

KEB Hana B

ank and othe

0.00001~9.45

3,059,551

2,914,830

Banker’s Usance

KEB Hana Bank and ot

hers

0.15~4.40

786,755

373,230

Commer

cial pape

Shinhan B

ank and ot

hers

0.19~2.80

4,791,413

4,827,568

Asset-backed securities

RBC and others

1.46~1.62

1,279,161

୸

13,087,836

୸

13,780,670

(2)

Long-term de

bt as of December 31,

2021 and December

31, 2020 are as follows.

Description

Lender

Annual

interest rate

December 31,

2021

December 31,

2020

(%)

(In millio

ns of Korean Won)

General bor

rowings

Mizuho Bank an

d others

0.01~12.17

୸

9,738,949

୸

8,911,475

Credit facilities

NH Bank and others

1.52~2.61

540,600

551,100

Commer

cial pape

BNK Investm

ent & Securities

and others

1.19~2.12

1,650,000

1,490,000

Asset-backed securities

HSBC

and others

0.55~1.85

4,136,643

5,652,711

Others(*)

NH Investme

nt & Securities

and others

392,032

435,607

16,458,2

17,040,893

Less: pres

ent value discount

(88,059)

(90,201)

Less: current m

aturities

(5,702,434)

(4,223,968)

୸

10,667,731

୸

12,726,724

(*) The

Group tr

ansf

erred a

porti

on of its votin

g share

s to a

third

party w

ith t

e tota

l reven

e swa

p agreeme

nt. However

, the

roup still

recogniz

es it

as the

financial as

set b

ecause the Group still owns the majorit

y of the risks and rewards of ownersh

ip of the transferred

s. Also, t

he Group rec

ognize

d the amount

rece

ived from

disposal a

s borrowings.

(3)

Debentures as of December 31, 20

21 and December 31

, 2020 are as f

llows.

Description

Latest

maturity

date

Annual

interest rate

December 31,

2021

December 31,

2020

(%)

(In millions of Korean Won)

Non-guaranteed publ

ic debent

ures

June

30,

2031

0.96~3.38

୸

31,533,051

୸

30,083,284

Non-guaranteed pri

vate debentures

April 8, 2

030

0.80~6.38

27,604,469

16,77

4,640

Asset-backed securities

June

15,

2028

0.12~3.29

19,359,999

13,931,180

78,497,5

60,78

9,104

Less: di

scount on deb

entures

(162,

242)

(113,706)

Less: current m

aturities

(14,876,468)

(11,880,

037)

୸

63,458,809

୸

48,795,361

ڐڔٻ

17. PR

OVISION

(1)

Provis

ions as of De

cember 31,

2021 and Dece

mber 31, 202

0 are as follows.

Description

December 31,

2021

December 31,

2020

(In millions of Korean Won)

Warran

୸

9,048,185

୸

8,514,173

Other long-te

rm employee benefits

676,432

729,996

Others

1,154,167

1,126

,719

୸

10,878,784

୸

10,370,888

(2) The changes

in provisi

ons for the

year

ended December 31, 2021 a

re as follows.

Descripti

Warranty

Other long-te

employee benefits

Others

(In millions of Korean Won)

Beginning o

f the year

୸

8,514,173

୸

729,996

୸

1,126,719

Charged

2,900,638

42,595

680,707

Utilized

(2,551,7

16)

(96,713)

(631,469

)

Effect of foreig

n exchange

differences

and others

185,090

554

(21,790)

End of the yea

୸

9,048,185

୸

676,432

୸

1,154,167

The changes in pr

ovisions for

the year en

ded Decem

ber 31, 2020 are as follows.

Description

Warranty

(*)

Other long-te

employee benefits

Others

(In millions of Korean Won)

Beginning o

f the year

୸

5,447,307

୸

726,356

୸

971,266

Charged

5,170,165

82,965

739,545

Utilized

(1,963,7

82)

(77,324)

(573,081

)

Effect of foreign exchange differences

and others

(139,517

)

(2,001)

(11,011)

End of the yea

୸

8,514,173

୸

729,996

୸

1,126,719

(*)

During the year end

ed December 31

, 2020, the Group

has reflected effect o

f new informat

ion and long

er period of hi

storical

claim data i

n the measuremen

t of warranty

provision

s in relation to th

e recall of thet

a 2 and other engin

es.

18. OTHER FINANCIAL LIA

BILITIES:

(1)

Other financial liabilities as of D

ecember 31, 2

021 are as fol

lows.

December 31, 2021

Description

Current

Non-current

(In millions of Korean Won)

Financial liabilities m

easured at FVPL

୸

674

୸

53,427

Derivative liabilities th

at are effective h

edging instruments

54,365

32,705

Financial Liabilities measu

red at amortized

cost

148

1,126

୸

55,187

୸

87,258

ڑڋٻ

(2)

Other financial liab

ilities as of December 31, 2020 are as follows.

December 31, 2020

Description

Current

Non-current

(In millions of Korean Won)

Financial liabilities m

easured at FVPL

୸

5,285

୸

25,759

Derivative liabilities th

at are effective hedgin

g instruments

95,043

433,748

୸

100,328

୸

459,507

19. OT

HER

LIABILIT

IES:

Other liabilities as of Decem

ber 31,

2021 and December

31, 2020

are as follows.

December 31, 2021

December 31, 2020

Description

Current

Non-current

Current

Non-current

(In millions of Korean Won

)

Advances received

୸

1,235,937

୸

42,482

୸

1,080,726

୸

22,580

Withhol

dings

968,318

197,714

1,094

,177

194,927

Accrued

penses

2,851,17

2,957,418

Unearned

inc

ome

864,536

2,356,66

742,484

1,705,607

Due to customers

for contract

work

902,124

855,866

Others

618,031

747,755

561,914

689,638

୸

7,440,120

୸

3,344,618

୸

7,292,585

୸

2,612,752

20. FINANCIAL

INSTRUMENTS:

(1)

Financial assets by categories

as of December 31,

2021 are a

s follows.

Description

Financial

assets

measured at

FVPL

Financial assets

measured at

amortized cost

Financial

assets

measured at

FVOCI

Derivative

assets that are

effective

hedging

instrum

ents

Book value

Fair value

(In millio

ns of Korean Won)

Cash an

cash equivalent

୸

12,795,554

୸

12,795,554

୸

12,795,554

Short-term an

d long-

term financial

instrum

ents

7,2

55,7

7,2

55,7

7,2

55,7

Trade notes and

accounts receivable

3,284,453

Other receivables

2,076,803

Other

financial

assets

12,472,100

27,195

2,911,523

525,114

15,935,932

Other

assets

23,568

331,353

354,921

Financial services

receivables

81,029,132

81,059,639

୸

12,495,668

୸

106,800,

233

୸

2,911,523

୸

525,114

୸

122,732,

538

୸

122,763,

045

ڑڌٻ

Financial assets by categories as of December 31,

2020 are as follows.

Description

Financial

assets

measured at

FVPL

Financial assets

measured at

amortized cost

Financial

assets

measured at

FVOCI

Derivative

assets that are

effective

hedging

instrum

ents

Book value

Fair value

(In millio

ns of Korean Won)

Cash an

cash equivalent

୸

9,862,136

୸

9,862,136

୸

9,862,136

Short-term an

d long-

term financial

instrum

ents

7,281,554

Trade notes and

accounts receivable

3,408,241

Other receivables

3,025,835

Other financial

assets

13,093,457

37,965

2,322,944

221,969

15,676,335

Other

assets

24,20

303,986

328,189

Financial services

receivables

69,665,210

70,435,392

୸

13,117,660

୸

93,584,927

୸

2,322,944

୸

221,969

୸

109,247,

500

୸

110,017,

682

(2)

Financial liab

ilities by categories as of December 31, 2

021 are as follows.

Description

Financial liab

ilities

measured at FVPL

Financial liab

ilities

measured at

amortized cost

Derivative liab

ilities

that are effective

hedging ins

truments

Book value

Fair value

(In millions of Korean Won)

Trade notes and

accounts paya

ble

୸

9,155,255

୸

9,155,255

୸

9,155,255

Other

payables

5,422,32

5,422,320

Borrowings

and

debentures

107,793,

278

107,793,

278

108,112,411

Other financial liabilities

54,101

1,274

87,070

142,445

Lease liabilities

950,572

Other liabilities

2,415,891

୸

54,101

୸

125,738,

590

୸

87,070

୸

125,

879

,761

୸

126,198,

894

Fin

ancial liabilities by categ

ories as of December 31, 2020 are as follows.

Description

Financial liab

ilities

measured at

FVPL

Financial liab

ilities

measured at

amortized cost

Derivative liab

ilities

that are effective

hedging ins

truments

Book value

Fair value

(In

millions of Korean Won)

Trade notes and

accounts paya

ble

୸

8,793,179

୸

8,793,179

୸

8,793,179

Other

payables

5,280,28

5,280,286

Borrowings

and

debentures

91,406,760

92,947,639

Other financial liabilities

31,044

528,791

559,835

559,8

Lease liabilities

757,044

Other liabilities

2,519,044

୸

31,044

୸

108,756,

313

୸

528,791

୸

109,316,

148

୸

110,857,

027

ڑڍٻ

(3)

Fair valu

e estimation

The Group categorizes the ass

ets and liabilities measured at fair

value into the following t

hre

e-level fair value hierarchy

in accordance with the inputs

used

for fair value measureme

nt.

Level 1: Quoted prices (unadjusted) in activ

e markets for identical assets or liabilitie

Level 2: Inputs other than quoted prices includ

ed within Level 1 that are observable for the asset or liab

ility, either

directly (i.e. as prices) or in

dir

ectly (i.e. deri

ved from prices).

Level 3: Inputs for the asset or liability that are n

ot based on observable market d

ata (unobservable inputs)

Fair value measurements of fi

nancial inst

ruments by fair value

hierarchy levels as of Decemb

er 31, 2021 are as

follows.

December 31, 2021

Description

Level 1

Level 2

Level 3

Total

(In millions of Korean Won)

Financial assets

Financial assets measured

at FVPL

୸

107,290

୸

12,226,048

୸

162,330

୸

12,495,668

Derivative assets that are

effective hedging i

nstruments

525,114

Financial assets measured

at FVOC

1,561,959

435,797

913,767

2,911,523

୸

1,669,249

୸

13,186,959

୸

1,076,097

୸

15,932,305

Financial liab

ilities:

Financial liabilities m

easured

at FVPL

୸

962

୸

53,139

୸

54,101

Derivative liabilities th

at are

effective hedging i

nstruments

87,070

୸

88,032

୸

53,139

୸

141,171

Fair value measu

rements of financial instrum

ents by fair

value hierarc

hy levels as of Dece

mber 31, 2020 a

re as

follows.

December 31, 2020

Description

Level 1

Level 2

Level 3

Total

(In millions of Korean Won)

Financial assets

Financial assets measured

at FVPL

୸

96,561

୸

12,506,079

୸

515,020

୸

13,117,660

Derivative assets that are

effective hedging i

nstruments

221,969

Financial assets measured

at FVOC

1,264,786

318,489

739,669

2,322,944

୸

1,361,347

୸

13,046,537

୸

1,254,689

୸

15,662,573

Financial liab

ilities:

Financial liabilities m

easured

at FVPL

୸

31,044

୸

31,044

Derivative liabilities th

at are

effective hedging i

nstruments

528,791

୸

559,835

୸

559,835

ڑڎٻ

The changes in financi

al ins

truments clas

sified as

Level 3 for the yea

r ended Decembe

r 31, 2021 are

as follows

Descri

tion

Beginni

of the

perio

Purchases

Dispo

sals

Valuation

Others

End of

the peri

(In millions of Korean Won)

Financial asse

ts measure

at FVPL

୸

515,

020

୸

38,07

୸

(

411,334

)

୸

20,56

୸

162,330

Financial asse

ts measure

at FVOCI

9,669

6,580

(

2,579

)

73,80

36,29

913,767

Financial lia

bilities measured

at FVPL

52,323

816

53,139

The changes in financial i

nstruments class

ified as Leve

l 3 f

or the year en

ded December 3

1, 2020 are

as follows

Description

Beginni

of the

perio

Purchases

Disposals

Valuation

Others

End of

the peri

(In millions of Korean Won)

Financial asse

ts measure

at FVPL

୸

572,618

୸

38,70

୸

(

24,84

)

୸

(

77,76

)

୸

6,307

୸

515,020

Financial asse

ts measure

at FVO

748,091

35,74

(52,03

7,863

739,669

(4)

Financ

ial assets and liabilitie

s subject to of

fsetting, and financial instru

ments subject to

an enforceable master ne

tting

arrangement or similar agree

ment as of December 31, 2021 are as

follows.

Descri

tion

Gross

amount

of r

ecogn

ized

financi

al assets

and li

abiliti

Gross

amount

of r

ecogn

ized

financi

al assets

and li

abiliti

set off in the

consoli

dated

statem

ent o

financi

ositio

Net a

mounts

financi

al assets

and li

abiliti

pre

sen

ted in the

consoli

dated

statem

ent o

financi

ositio

Relate

amou

nts n

set

f in the

consoli

dated

statem

ent o

financi

positi

on -

financi

instr

uments

Relate

amou

nts n

set off in the

statem

ent o

financi

positi

on -

llater

recei

ved

led

)

Net

mounts

(In mil

lions o

f Korean W

on)

Fina

ncial

assets

Tra

de not

and acc

ounts

recei

vable

୸

3,519,2

୸

234,

831

୸

3,284

,453

୸

3,284

,453

Other

rec

eivab

les

2,573

,976

497

,173

,076,

803

,076,

803

Fina

ncial a

ssets meas

ured at

FVPL

14,534

14,513

Deriva

tive as

sets that ar

effe

ctiv

e hed

ins

trument

(

)

5,11

525,

114

18,204

506,91

୸

6,632

,908

୸

732,

004

୸

5,900

,904

୸

18,2

୸

5,882

,679

Financ

ial

liab

iliti

es:

Tra

de not

and acc

ounts

able

୸

9,640,1

୸

484,

878

୸

9,155

,255

୸

9,155

,255

Other

pay

ables

5,669

,446

247

,126

,422,320

5,422

,320

Financ

ial liabili

ties m

easured at

FVPL

54,101

54,080

Deriva

tive li

abilit

ies that ar

effe

ctiv

e hedg

ing ins

tru

ments (*)

87,070

18,204

68,866

୸

15,450

,75

୸

732,

004

୸

14,71

8,746

୸

18,2

୸

14,70

0,521

(*)

These are de

rivative as

sets a

nd liabilitie

s tha

t the G

roup may ha

the rig

ht to offset

in the event of

default, ins

olvency

or bankr

uptcy

of the c

ounterpa

rty alth

ough thes

e do not

meet the crite

ria of

offsetting u

nder K-IFRS

1032.

ڑڏٻ

Financial assets and

liabilities, sub

ject to offsetting

, and financial instruments su

bject to an enforc

eable master

netting arrangement or similar agreement as of December 31, 2020 are as follows.

Descr

iption

Gross

amount

of r

ecogn

ized

financi

al assets

and li

abiliti

Gross

amount

of r

ecogn

ized

financi

al assets

and li

abiliti

set off in the

consoli

dated

statem

ent o

financi

positi

Net a

mounts

financi

al assets

and li

abiliti

pre

sen

ted in the

consoli

dated

statem

ent o

financi

positi

Relate

amou

nts n

set

f in the

consoli

dated

statem

ent o

financi

positi

on -

financi

instr

uments

Relate

amou

nts n

set off in the

statem

ent o

financi

positi

on -

llater

recei

ved

(ple

dged)

Net

amount

(In millio

ns of K

orea

Won

)

Fina

ncial

assets:

Trade no

tes and accoun

recei

vable

୸

3,592

,148

୸

183,

907

୸

3,408

,241

୸

3,408

,241

Other

rece

ivab

les

3,388,

160

362,325

025,835

3,025

,835

Fina

ncial a

ssets meas

ured at

FVPL

160,

692

160,69

Deriva

tive as

sets that ar

effe

ctiv

e hed

ins

trument

(

)

221,

969

221,96

68,885

153,084

୸

7,362

,969

୸

546,

232

୸

6,816

,737

୸

68,8

୸

6,747

,852

Financ

ial

liabiliti

es:

Trade no

tes and accoun

able

୸

9,167

,936

୸

374,

757

୸

8,793

,179

୸

8,793

,179

Other

yables

5,45

1,761

1,475

5,2

80,286

5,280,28

Financ

ial liabili

ties m

easured at

FVPL

31,0

31,044

Deriva

tive li

abilit

ies that ar

effe

ctiv

e hedg

ing ins

tru

ments (*)

528,

791

528,79

68,885

459,906

୸

15,179

,53

୸

546,

232

୸

14,6

33,3

୸

68,8

୸

14,5

64,4

(*)

These are de

rivative as

sets a

nd liabilitie

s that

the G

roup may ha

the rig

ht to offset

in the e

vent of

default, ins

olvenc

y or bankr

uptcy

of the c

ounterpa

rty alth

ough thes

e do not

meet the crite

ria of

offsetting u

nder K-IFRS

1032.

(5)

Interest income, divi

dend income and i

nterest ex

pens

es by c

ategories of financia

l instrume

nts for the year ended

December 31, 2021 a

e as foll

ows.

2021

Description

Interest

income

Dividend

income

Interest

expenses

(In millions of Korean Won

)

Non-financial ser

vices:

Financial assets measu

red

at amortized cost

୸

248,198

୸

Financial assets

measured at FVPL

100,415

Financial assets measu

red

at FVOCI

28,419

Financial liabilities m

easured

at amortized cost

267,648

୸

348,613

୸

28,419

୸

267,648

Financial services:

Financial assets measu

red

at amortized cost

୸

4,138,039

୸

Financial assets measu

red

at FVPL

4,040

1,721

Financial assets measu

red

at FVOCI

203

Financial liabilities m

easured

at amortized cost

1,730,903

୸

4,142,282

୸

1,721

୸

1,730,903

ڑڐٻ

Interest income,

dividend income and i

nterest expens

by cat

egories of fi

nancial instruments

for the year ende

December 31, 2020 a

re as follows.

2020

Description

Interest

income

Dividend

income

Interest

expenses

(In millions of Korean Won

)

Non-financial ser

vices:

Financial assets measu

red

at amortized cost

୸

289,171

୸

Financial assets

measured at FVPL

112,176

Financial assets measu

red

at FVOCI

31,650

Financial liabilities m

easured

at amortized cost

295,069

୸

401,347

୸

31,650

୸

295,069

Financial services:

Financial assets measu

red

at amortized cost

୸

3,930,986

୸

Financial assets measu

red

at FVPL

5,621

2,227

Financial assets measu

red

at FVOCI

882

Financial liabilities m

easured

at amortized cost

1,847,378

୸

3,937,489

୸

2,227

୸

1,847,378

(6)

The commission

income (financial services re

venue) arisin

g from

financial assets or liab

ilities other

than fina

ncial

assets or liabilities measu

red at FVPL for th

e years ended December 31, 2021 and 2020 are

୸

923,656 million and

୸

784,509 million, res

pectively. In addition

, the fee expens

(cost of sales from fina

ncial services)

financial assets

or liabilities

other than

financial assets o

liabilities mea

sured at FVPL

for the y

ears ended Decem

ber

31, 2021 a

nd 2020 are

୸

74,229 million

and

୸

319,

684 million, respectively.

(7)

The Group recognizes

trans

fers between le

vels of the fair

value hierarchy at

the date of t

he event

or cha

nge i

circumstances that caused the

transfer.

There are no signific

ant transfers be

tween Level 1

and Level 2 for the year

ended December 31, 2

021.

(8)

Descriptions of t

he valuation t

echniques and the i

nputs used i

n the fair val

ue measurements categorized

within

Level 2 and Level 3 of t

he fair value hierarchy are as follows.

Currency

forwar

ds, optio

ns and swap

Fair value o

f currency f

rwards, opt

ions an

d swap is meas

ured based

on forward exchange

rate quoted in t

he current

market at the end o

f the report

ing period, which

has the same remaining

period

of derivatives

be measured.

the forward

exchange

rate, whi

ch has t

he same remai

ning period of

currency f

orwards, options

and

swap, is n

quoted in the cu

rrent market

, fair value i

s measured

using esti

mates of simi

lar

period

forward

exchan

ate

applying i

nterpolatio

n method

with quoted

forward exc

hange rates.

As the input

s used to meas

ure fair value of currency forward

s, options and swap are suppor

ted by observable marke

data, such as forward exc

hange rates, the Group classifies

the estimates of fair v

alue

easurements

the

urrency

forwards, opti

ons and s

wap as Level 2 of t

he fair value

hierarchy.

- Interest rate swap

The discoun

t rate and forward interest rate used to measure the fair v

alue of interest rate swap are determ

ined based

on an applicabl

e yield curve

derived from interes

t quoted i

n the curre

nt market at t

he end of the re

porting peri

od.

The fair value

of inter

est rate swap was

measured as

a dis

count on

the estimated

future c

ash flows

of interes

t rat

swap based on f

rward int

erest rates

derived from the

above method at an app

ropriate di

scount rate.

ڑڑٻ

As the inputs

used to measure

fair value

of interest rate swap are s

upported b

y observable

market

data,

such

yield curves, the Grou

p classifies the es

timates of fair value

measurements

of the interest rate s

wap as Lev

el 2 of the

fair value hierarchy.

- Debt ins

truments incl

uding c

orporate bo

nds

Fair value of de

bt instruments i

ncluding corporat

e bonds

is measured applying dis

counted cas

h flow metho

The rate used to di

scount cas

flows i

s determined ba

sed

on swap rate and c

redit sprea

ds of debt instrume

nts,

which have the

simila

r credit rat

ing and perio

d quoted in the current

market with th

ose of debt instrume

nts

including cor

porate bonds th

at should

be measured.

The Group class

ifies fair val

ue meas

urements of debt

instruments

including cor

porate bonds as Level

2 of the fair

-value hierarchy since t

he rate,

which

has

significa

effects on fair

value of de

bt i

nstruments i

ncluding cor

porate bonds, is based

on observable market dat

- Unlisted equity secur

ities

Fair value of unlisted equity s

ecuritie

s is measured us

ing dis

counted cash fl

projection and market approac

, and

for

discounte

d cash

flow

projections

, cert

ain

assumptions not

based on observable ma

rket prices or rat

e, such as

sales

growth rate, pre

-tax oper

ating income

ratio and

count rate bas

ed on busines

s plan and circums

tance of

industry

are used to est

imate the fut

ure cash flow

. The disc

ount rate us

ed to discount

the fut

re cash

flows

calculated by apply

ing the Capital Asset Pricing Mode

l, using the data of similar

listed companies.

The

Group

determines that t

he effect of e

stimati

on and assumptions

referred

above

affecting

fair

value

unlisted

equi

securities is sign

ificant and classifies fair

value measur

ents

unlisted

securities as Level 3 of th

e fair value

hierarchy.

- Put option

s (Derivatives)

The fair value of put option

s (derivatives) is measured b

ased on the stock price volatility

up to the fair value, exercise

price, and maturi

ty of the und

erlying asset, usi

ng the binomi

al option pri

cing model.

The dis

count rate us

ed in the

binomial o

ption pric

ing mo

del is

applied

by conve

rting t

he rate

of return on

corporate bon

s wit

h equivalent credi

rating c

orresponding

to the remai

ning maturi

ty int

o a cont

inuous c

ompoundi

ng discount

rate, and the

stock price

volatility up to maturity

es historical volatility of

proxy companies in similar in

dust

ries in response to the

remaining m

aturity. The fair value of the unde

rlying asset is assumed to

be maintained

until the end of th

e current

period afte

r estimati

ng the un

derlying as

set val

ue on the c

ontracted dat

e by inverti

ng th

e underlying

asset value

inheren

t in the terms of

the transaction on the premise th

the acquisition transactio

n of related shares in th

e current

period is

an orderl

y transa

ction and tra

ded at fair value. T

he group classifi

es the fair va

lue measurement of p

options (derivatives) as Lev

el 3 in the fair v

alue hierar

chy base

d on the assumption t

hat the effect of t

he above

assumptions

and estimates

on the fair val

ue of put

options cl

assified.

(9)

The quantitative information about significan

t unobservable inputs used in the fair value m

easurements

categorized

within Level 3

of the fair

value hierarchy and

the des

cription o

f relatio

nships of

signifi

cant

unobservable i

nputs to the fair

value are as follows:

Description

Fair value at

December 31, 2021

Valuation

techniques

Unobservable

inputs

Range

Descri

ption of

relation

ship

Financial

assets

Financial

liabilities

n millions of Korean Won)

Unlisted equity

securities,

put optio

and others

୸

1,076,097

୸

53,139

Discounted

cash flow

and others

Sales

growth rate

0.0% ~ 5.8%

If the sales

growth rate

and the pre-

tax

operating

profit m

argin

ratio increases

or the disco

unt

rate declines,

the fair valu

increases.

Pre-tax operating

profit margin

ratio

3.4% ~ 5.0%

Discount rate

2.0% ~ 9.7%

Stock

price

volatility

30% ~ 40%

The Group does not

expect ch

anges in signi

ficant unobs

ervable i

nputs that are us

ed for refl

ecting alte

rnative assumpt

ions

would have s

ignificant i

mpact on the

fair value.

ڑڒٻ

21. CA

PITAL

STOCK:

The Company’s num

ber of shares authorized i

s 600,

000,000 shares. Common s

tock and

preferred s

tock as of

December 31, 2021 a

nd December 31, 2020 are as follows

(1) Common

stock

Description

December 31, 2021

December 31

, 2020

(In millions of Korean W

on, except par

value)

Issued

213,668,187 sha

res

213,668,187 sha

res

Par value

୸

5,000

୸

5,000

Capita

l stock

1,157,982

1,157,98

The Company comple

ted stock ret

irement of 10,00

,000 common shares

, 1,320,

000 common s

hares and 6,608

,292

common shares as of March

5, 2001, May 4, 2004 a

nd July 27,

2018 respectivel

y. Due to these s

tock retirements

, the

total face value of outstanding

stock

differs from the capital

stock amount.

(2) Preferred

stock

Descript

ion

Par value

Iss

ued

Korean Won

Dividend rate

(In millions of

Korean Won)

preferred s

tock

୸

5,000

24,356,685

୸

125,550

Dividend rate

of common

stock + 1%

preferred stock

36,485,451 shares

193,069

The lowest

stimulat

ed dividend rat

e: 2%

preferred stock

2,428,735 shares

12,392

The lowest sti

mulated dividen

d rate: 1%

63,270,871

୸

331,011

As of March 5, 200

1, the Company reti

red 1,000

,000 second

preferred sha

res and as of July 27, 2018

, the Company

retired 753,2

97 first

preferred s

ares, 1,128,

414 second preferred

shares and 49,564 thi

rd prefe

rred shares. Due to

the

stock retirement

, the tota

l face value of

outstandi

ng stock di

ffers from the capita

l stock am

ount.

22. CAPITAL

SURPLUS:

Capital surplus as

of December 31,

2021 and December

31, 2020 a

re as follows.

Description

December 31, 2021

December 31, 2020

(In millio

ns of Korean Won)

Paid-in capital in ex

cess of par value

୸

3,321,334

୸

3,321,334

Others

748,9

868,759

୸

4,070,26

୸

4,190,093

23.

OTHER CAPITA

L ITEMS:

Other capital

items consi

st of treas

ury stocks pu

rchased for the stabi

lization of s

tock price.

Number of treasury s

tocks

as of December 31,

2021 and

December 31, 2020 are as foll

ows.

Description

December 31,

2021

December 31,

2020

(Number

shares)

Common stock

14,048,242

13,091,418

preferre

d stock

2,333,133

2,186,993

preferred st

ock

1,572,482

1,353,570

preferred st

ock

63,146

48,574

ڑړٻ

24.

ACCUMULATED OTHER COMPREH

ENSIVE LOSS:

(1)

Accumulated othe

r comprehens

ive loss

as of December 31,

2021 is as follows.

Description

December 31, 2021

(In m

illions of Korean Won)

Gain on val

uation of fina

ncial assets measured at F

VOCI

୸

451,693

Loss on valuati

on of fi

nancial as

sets measured at FVOCI

(370,812)

Gain on val

uation of cas

h flow hedge de

rivatives

56,048

Loss on valuati

on of cash

flow hedge de

rivatives

(42,068)

Gain on share

of the other c

omprehensive income of

equity-accounted invest

ees

228,299

Loss on share of

the other comprehensive i

ncome of

equity-accounted invest

ees

(587,620

)

Loss on forei

gn operations trans

lation, net

(1,508,141)

୸

(1,772,601)

(2)

Accumul

ated othe

r comprehens

ive loss as of December 31,

2020 is as follows.

Description

December 31, 2020

n millions of Korean Won)

Gain on val

uation of fina

ncial assets measured at F

VOCI

୸

453,715

Loss on valuati

on of fi

nancial as

sets measured at FVOCI

(351,813)

Gain on val

uation of cas

h flow hedge de

rivatives

102,057

Loss on valuati

on of cash

flow hedge de

rivatives

(40,175)

Gain on share

of the other c

omprehensive income of

equity-accounted inves

tees

22,501

Loss on share of

the other comprehensive i

ncome of

equity-accounted inves

tees

(925,992)

Loss on forei

gn operations trans

lation, net

(2,669,954)

୸

(3,409,661)

ڑڔٻ

25. RETAINED

ARNINGS:

(1)

etained earnings as

of December 3

1, 2021 and Decem

ber 31, 2020 are as follow

Description

December 31, 2021

December

31,2020

(In

millions of Korean Won)

Legal reserve (*)

୸

744,836

୸

744,836

Discretionary res

erve

47,701,296

47,935,596

Unappropriated

24,721,723

20,231,368

୸

73,167,855

୸

68,911,800

(*)

The Comm

ercia

l Code of

the Re

public

of Korea requir

es the C

ompany to ap

propria

te as

a legal r

eserve

, a minim

um of 1

% of

annual ca

sh div

idends de

clare

d, until s

uch reserve equals

50%

of its capital stoc

k iss

ued. The re

serve

is not a

vailable f

or th

paymen

t of cash dividen

ds, but may b

e transferred to

capital stock or u

sed to redu

ce accumulated

deficit, i

f any.

Appraisal

gains, amounting t

୸

1,852,

871 million,

derived from asset reval

tion pursuant

to the Asset Revaluati

on Law

of Korea are included i

n retained earni

ngs. It may be onl

y transferred t

o capital st

ock or used to reduce accum

ulated

deficit, if any.

(2)

The computation of t

he interim di

vidends for t

he year ended December 31,

2021 is as follows

, and there are n

interim divi

dends for

the year

ended December 31, 2

020.

Description

Common

stock

Preferred

stock

Preferred

stock

Preferred

stock

(In millions

of Korean W

on, except per s

hare amount

Par value per s

hare

୸

5,000

୸

5,000

୸

5,000

୸

5,000

Shares, net of treas

ry st

ocks

200,576,769

22,169,692

35,131,881

2,380,161

Dividends per s

hare

୸

1,000

୸

1,000

୸

1,000

୸

1,000

Dividend

rate

20%

Dividends

declared

200,577

22,170

35,132

2,380

(3)

The computation of the

propos

ed dividends f

or the year end

ed December 31,

2021 is as fo

llows.

Description

Common

stock

Preferred

stock

Preferred

stock

Preferred

stock

(In millions of Korean Wo

n, except per share amounts)

Par value per s

hare

୸

5,000

୸

5,000

୸

5,000

୸

5,000

Shares, net of treas

ry st

ocks

199,619,945

22,023,552

34,912,969

2,365,589

Dividends per s

hare

୸

4,000

୸

4,050

୸

4,100

୸

4,050

Dividend

rate

80%

81%

82%

81%

Dividends

declared

798,480

89,195

143,143

9,581

The computation of the

divide

nds for t

he year ended D

ecember 31, 20

20 is as follows.

Description

Common

stock

Preferred

stock

Preferred

stock

Preferred

stock

(In millions

of Korean W

on, except per s

hare amount

Par value per s

hare

୸

5,000

୸

5,000

୸

5,000

୸

5,000

Shares, net of treas

ry st

ocks

200,576,769

22,169,692

35,131,881

2,380,161

Dividends per s

hare

୸

3,000

୸

3,050

୸

3,100

୸

3,050

Dividend

rate

60%

61%

62%

61%

Dividends

declared

601,730

67,618

108,909

7,259

ڒڋٻ

26. HY

BRID

ND:

(1)

Hyundai Card Co., Lt

d., a sub

sidiary of t

he Company,

issued hyb

rid bond

and the Grou

p clas

sified it

as equity

(non-controlling interes

ts). As of Decembe

r 31, 2021,

hybrid bond is as follows.

Description

Issue date

Maturity date

Annual

interest rate

December 31, 2021

(%)

(In million

s of Korean Won)

The 731st

Hybrid Tier

1 (Private)

July 5, 2018

July 5, 2048

4.70

୸

300,000

Issue cost

(760)

୸

299,240

Hyund

ai Rotem Company

, a subsidi

ary of the Comp

any, paid off all h

ybrid bond

s during the y

ear ended Decemb

er 31, 2021

(2)

As of December 31, 2021, the

conditions of hy

brid

bon

d that Hyundai Card C

o., Ltd., a

subsidiary of the

Company issued are as f

ollows.

Descr

iption

Maturity

Thirty years (Mat

urity extension is

possibl

e according to t

he issuer's deci

sion

upon maturity)

Interest rate

Issue date ~ J

uly 5, 202

3 : An annual fi

xed inte

rest rate 4

.7%

Increase of 2% after five years which

is limited to one time only in accordance with

Step-up clause

Interest payment

condition

Three mo

nths, optional pos

tpo

nement of payme

Others

Repayment b

efore maturity by issuer is available after f

ive years from issue date

27. SALES:

(1) Sales for the years

ended December

31, 2021 a

nd 2020 are as follows.

Description

2021

2020

(In millio

ns of Korean Won)

Sales

of goods

୸

99,722,885

୸

87,288,494

Rendering o

f services

2,624,047

2,329,450

Royalties

276,564

188,293

Financial s

ervices revenue

11,536,9

10,920,622

Revenue relate

d to const

ruction cont

racts



2,814,036

2,691,090

Others

636,124

579,6

୸

117,610,

626

୸

103,997,

601

(2) As of December 3

1, 2021,

the aggregate transaction

pric

e allocated to the

unsatisfied

(or partially u

nsatisfied)

performance obli

gation that

is expected to

be recognized

as revenue in futu

re periods is as follows

Description

Within a year

After a year

(In millio

ns of Korean Won)

Deferred revenue

and others

୸

1,498,039

୸

2,282,685

ڒڌٻ

28.

SELLING AND AD

MINIS

TRATIVE EXPEN

SES:

Selling and admi

nistrative expens

es for the yea

rs ended Dec

ember 31, 2

021 and

2020 are as

follows.

Description

2021

2020

(In m

illions of Korean Won)

Selli

ng expenses:

Export expens

୸

46,057

୸

59,617

Overseas market expe

nses

412,476

352,8

s and sal

es promot

ion

2,609,784

2,241,45

Sales

commiss

ions

983,949

971,0

Expenses for war

ranties

2,947,290

4,813,729

Transportati

on expens

116,035

109,2

7,115,591

8,548,010

Administrat

ive expenses:

Payroll

2,882,164

2,688,55

Post-employment

benefits

177,845

183,312

Welfare expenses

496,461

464,6

Service charges

1,529,151

1,415,02

Research

1,534,993

1,337,872

Others

1,515,341

1,449,597

8,135,955

7,538,989

୸

15,251,546

୸

16,086,999

29.

GAIN(LOSS) ON INVESTM

ENTS IN

JOI

NT VE

NTURES

AND AS

SOCIA

Gain(loss

) on investments

in joint

ventures and as

sociates fo

r the years ended D

ecember 31, 20

21 and 2020 i

s as

follows.

Description

2021

2020

(In millions of Korean Won)

Gain on share

of earnings of

equity-accounted in

vestees, net

୸

1,278,591

୸

103,676

Gain on dispos

als of in

vestments

in associat

38,106

58,48

Impairment l

oss on inves

tments

in associates

(13,332)

୸

1,303,365

୸

162,162

30.

FINANCE INCO

ME AND EXPEN

SES:

(1)

Finance income for the

years ended

December 31, 2

021 and 2020

are as follows.

Description

2021

2020

(In millio

ns of Korean Won)

Interest inco

୸

348,6

୸

01,347

Gain on foreign excha

nge transactions

62,003

55,468

Gain on foreign curre

cy transl

ation

162,811

239,554

Dividend income

28,419

31,

650

Gain on derivatives

89,522

80,

654

Others

221,434

5,243

୸

912,8

୸

13,916

ڒڍٻ

(2)

Finance expenses

for the yea

rs ended December 3

1, 2021 an

d 2020 are as f

llows.

Description

2021

2020

(In millio

ns of Korean Won)

Interest expenses

୸

304,5

୸

62,377

Loss on forei

gn exchange

transactions

54,622

180,732

Loss on forei

gn currenc

y translation

182,233

304,

377

Loss on derivatives an

d others

7,013

08,505

୸

48,410

୸

55,991

31.

OTHER INCOM

E AND EXPENS

ES:

(1)

Other income for t

he years en

ded December 31,

2021 and 2020 are as

follows.

Description

2021

2020

(In millions of Korean Won

)

Gain on foreign

exchange transacti

ons

୸

624,884

୸

446,641

Gain on forei

gn curre

ncy trans

lation

220,468

192,825

Gain on dis

posals of P

P&E

23,978

37,485

Commiss

ion income

22,716

43,601

Rental income

94,528

93,566

Others

460,687

494,524

୸

1,447,261

୸

1,308,642

(2)

Other expenses fo

r the years ended December 31, 2

021 and 2020 are as fol

lows.

Description

2021

2020

(In millions of Korean Won

)

Loss on forei

gn exchange trans

actions

୸

527,878

୸

590,009

Loss on forei

gn currenc

y translation

231,859

264,399

Loss on dis

posals

of PP&E

57,899

106,761

Donations

66,249

73,553

Others

950,520

595,422

୸

1,834,405

୸

1,630,144

32.

EXPEN

SES BY NA

TURE:

Expenses by

nature for the ye

ars ended December 31, 2021

and 2020 are as

follows.

Description

2021

2020

(In millions of Korean Won)

Changes in invent

ories

୸

434,257

୸

(22,609)

Raw materi

als and

merchandise used

67,579,441

59,084,867

Employee benefits

9,613,599

9,098,752

Depreciation

2,937

,914

2,749,51

Amortizati

1,617

,823

1,435,

860

Others

30,583,048

30,886,691

Total (*)

୸

112,766,

082

୸

103,233,

074

(*)

Sum of cost of

sales, se

lling and

administ

rative e

xpenses an

d other expe

nses in

the consoli

dated sta

tements of

income.

ڒڎٻ

33.

EARNINGS PER COMMON STOCK AND PREFERR

ED STOCK:

Basi

c earnings per common s

tock and preferred stock are c

omputed by dividing p

rofit available to common s

tock and

preferred st

ock by the weighted-avera

ge number of common

stock and preferred stock o

utstanding during the year. Th

Group does not

compute diluted earnings per c

ommon stock fo

r the

years ended December 31, 20

21 and 2020, si

nce there

are no dilutive items du

ring the years.

Basic earnings

per common st

ock and prefer

red stock for th

e years ended Decembe

r 31, 2021 an

d 2020 are computed as

follows.

For the year ende

d December 31, 2021

For the year

ended December 31, 2020

Description

Profit

attributable to

Weighted-

average number

of shares

outstandi

ng (*1)

Basic

earnings

per share

Profit

att

ributable to

Weighted-

average number

of shares

outstandi

ng (*1)

Basic

earnings

per share

(In millions o

f Korean Won, e

xcept per sha

re amounts)

Common stock

୸

3,806,754

200,578,

742

୸

18,979

୸

1,094,134

200,628,

493

୸

5,454

Preferred st

ock (*2)

421,090

22,160,384

19,002

122,043

22,181,699

5,502

Preferred stoc

669,282

35,117,788

19,058

195,156

35,149,829

5,552

Preferred st

ock

45,230

2,379,240

19,010

13,103

2,381

,349

5,502

(*1)

Wei

ghted

-average numb

er of shares ou

tstanding

includes th

e effects of tr

easury stock

transactio

ns.

(*2) 1

preferre

d stock me

ets the defi

nition of ‘ordina

ry shar

es’ as de

fined in K

-IFRS

1033 ‘Ear

nings per Share’.

34.

INCOME TAX EXP

ENSE:

(1)

The components of i

ncome tax expe

nse for the years ended

December 31, 20

21 and 2

020 are as

follows.

Description

2021

2020

(In

millions of Korean Won

)

Current tax ex

pense

୸

1,816,699

୸

1,201,923

Adjustments

recognized i

n the current

year in rel

ation to

the prior years

(274,525)

(286,756)

Changes in defer

red taxes rela

ting to

Temporary dif

ferences

1,718,022

(782,752)

Tax losses

and tax credits

(683,646)

49,890

Items that are charged o

r credited direc

ly to e

quity

(104,461

)

(56,735)

Effect of foreig

n exchange differences

and others

(205,604)

43,133

Income tax expe

nse

୸

2,266,485

୸

168,703

(2)

The reconciliation

from profit before i

ncome tax to income tax expense for the years ende

December 31, 2021

and 2020 are as

follows.

Description

2021

2020

(In

millions of Korean Won)

Profit befor

e income t

୸

7,959,562

୸

2,093,256

Income tax expens

e calcula

ted at the applicable

tax rates

of 21.4% in 2021 a

nd 26.6% i

n 2020

1,699

,706

556,247

Adjustments:

Non-taxable inc

ome

(100,314)

(84,808)

Non-deductibl

e expenses

261,172

55,101

Tax credits

(429,012)

(198,374)

Others

834,933

(159,

463)

566,779

(387,544

)

Income tax expe

nse

୸

2,266,485

୸

168,703

Effective tax rate

28.5%

8.1%



ڒڏٻ

(3)

e changes in deferred tax assets (liabilities)

for the year ended December 31, 2021 are as follows.

Description

Beginni

of the year

Changes

End

of the year

(In millio

ns of Korean Won)

Provis

ions

୸

2,713,730

୸

110,479

୸

2,824,209

Financial

assets

measured at FVP

1,795

(564)

1,231

Financial

assets

measured at FVOCI

(137,

271)

16,087

(121,

184)

, associates

and joint

ventures

(1,516,729)

(61,404)

(1,578,1

33)

Derivatives

(45,697)

44,181

(1,516)

PP&E

(5,058,726)

(803,017)

(5,861,743)

Accrued income

61,186

(77,026)

(15,840)

Gain (los

s) on foreign c

urrency transl

ation, net

431

(567)

(136)

Others

903,246

(946,191)

(42,945)

(3,078,0

35)

(1,718,022)

(4,796,057)

Carryforward

of tax l

osses and t

ax credits

2,647,916

683,646

3,331,562

୸

(430,119

)

୸

(1,034,376)

୸

(1,464,495)

The changes in deferred tax assets (liabilitie

for the year ended December 31, 20

20 are as follows.

Description

Beginni

of the year

Changes

End

of the year

(In millio

ns of Korean Won)

Provis

ions

୸

2,004,413

୸

709,317

୸

2,713,730

Financial

assets

measured at FVP

1,907

(112)

1,795

Financial

assets

measured at FVOCI

(124,

498)

(12,773)

(137,271)

, associates and joint

ventures

(1,565,485)

48,756

(1,516,729)

Derivatives

(35,584)

(10,113)

(45,697)

PP&E

(5,165,608)

106,8

(5,058,726)

Accrued income

137,079

(75,893)

61,186

Gain (loss

) on foreign c

rrenc

translat

ion, net

(19)

450

431

Others

887,008

16,238

903,246

(3,860,7

87)

782,752

(3,078,035)

Carryforward

of tax l

osses and t

ax credits

2,697,806

(49,890)

2,647,916

୸

(1,162,981)

୸

732,862

୸

(430,119

)

(4)

Income taxes relating to items that

are charged or cre

dited directly to equity for the yea

rs ended December 31,

2021 and

2020 are as f

ollows.

Description

2021

2020

(In

millions of Korean Won

)

Loss (gain) o

n disposal

of trea

sury stocks

୸

(9,451)

୸

828

Gain on fina

ncial ass

ets measured at F

VOCI, net

(32,147)

(9,472)

Loss (gain) o

n valuatio

n of ca

sh flow hedge

derivatives,

net

5,848

(36,505)

Remeasurement

s of define

d benefit pl

ans

(64,906)

(16,403)

Changes in retained earnings

of equity-acco

nted

investees, net

(3,805)

4,817

୸

(104,461

)

୸

(56,735)

(5)

The amount of t

emporar

y diff

erences associ

ated with inves

tments

in subsi

diaries, joint

ntures and as

sociates, for

which deferred tax liabilities are not recognized, are

୸

5,644,375 million and

୸

4,046,18

7 m

illion as of Decem

ber

31, 2021 and

2020, respectively.

ڒڐٻ

35. RETIR

EMENT

ENEFIT

PLAN:

(1)

Expenses recog

nized in rela

tion to defi

ned contribut

ion plans

for the years ended De

cember

31, 2021 and

2020 are as

follows.

Description

2021

2020

(In millio

ns of Korean Won)

Paid-in cash

୸

11,650

୸

10,651

Recognized liab

ility

,320

2,932

୸

14,970

୸

13,583

(2) The

significant

actuarial

assumptions

used by the Gr

oup as of December 31, 202

1 and De

cember 31, 2020 a

e as

follows.

Description

December 31, 2021

December 31, 2020

Discount

rate (*)

3.84%

3.44%

Rate of expected future salary

increase

4.51%

4.37%

(*) The Group a

pplied the market

yields

of high-

quality corporate b

onds (AA

+) and ot

hers as the

discount rate

December 31, 2021, to dis

count the defi

ned

benefit obligation to the present va

lue, and the same dis

count rate was

applied as the expected return

rate when

calculating interest income on plan assets

Employee turnov

er and mortality assumptions u

sed for actuarial valuation are based on the economic conditions and

statistical data of each

country where entities within the Group are lo

cated.

(3)

The amounts recognized i

n the consol

idated stat

ements of fi

nancial posi

tion related

to defined benefit

plans

December 31, 2021 a

nd December 31, 2020 are as

follows.

Description

December 31, 2021

December 31, 2020

(In million

s of Korean Won)

Present value of

defined benefit obligati

ons

୸

6,580,593

୸

6,490,583

Fair value of

plan asset

(6,721,149)

(6,253,299)

୸

(140,556

)

୸

237,284

Net defined

benefit liabilities

79,165

247,566

Net defined be

nefit assets

(219,721)

(10,282)

ڒڑٻ

(4)

Changes in

net defined benefit assets and liabilities

for the year ended December 31, 2021 are as follows.

Description

Present value of

defined

benefit o

bligations

Fair value of

plan assets

Net defined be

nefit

liabilities

(In

millions of Korean Won

)

Beginning o

f the year

୸

6,490,583

୸

(6,253,299)

୸

237,284

Current servi

ce cost

598,231

Interest

expens

(inco

140,222

(139,588

)

634

Past serv

ice cost

221

7,229,257

(6,392,887)

836,370

Remeasuremen

ts:

Return on pla

n assets

(1,247)

Actuarial gains

and losses

arising

from changes i

n demographic

assumpti

ons

2,573

Actuarial gains

and losses

arising

from changes i

n financial

assumpti

ons

(259,

343)

(259,343)

Actuarial gains

and losses

arising

from experience a

djustments and

others

17,719

17,

719

(239,051)

(1,247)

(240,298

)

Contribut

ions

(689,

687)

(689,687)

Benefits

paid

(447,857)

367,927

(79,930)

Transfers

(out)

2,721

(1,605)

1,116

Effect of foreig

n exchange

differences and ot

hers

35,523

(3,650)

1,8

End of the yea

୸

6,580,593

୸

(6,721,149)

୸

(140,556

)

Changes in

net defined

benefit assets and liabilities

for the year

ended December 31, 2020 are as follows.

Description

Present value of

defined

benefit o

bligations

Fair value of

plan assets

Net defined be

nefit

liabilities

(In

millions of Korean Won

)

Beginning o

f the year

୸

6,321,408

୸

(5,913,514)

୸

407,894

Current servi

ce cost

613,775

Interest

expens

(inco

135,718

(131,067

)

4,651

Past serv

ice cost

7,070,924

(6,044,581)

1,026,343

Remeasuremen

ts:

Return on pla

asset

(45,079)

Actuarial gains

and losses

arising

from changes i

n demographic

assumpti

ons

2,337

Actuarial gains

and losses

arising

from changes i

n financial

assumpti

ons

(4,28

(4,282)

Actuarial gains

and losses

arising

from experience a

djustments and

others

(8,94

(8,943)

(10,8

88)

(45,079)

(55,967)

Contribut

ions

(606,

302)

(606,302)

Benefits

paid

(531,416

)

400,577

(130,839)

Transfers

(out)

2,620

(1,306)

1,314

Effect of foreig

n exchange

differences and ot

hers

(40,657)

43,392

2,735

End of the yea

୸

6,490,583

୸

(6,253,299)

୸

237,284

ڒڒٻ

(5)

The sensitivity analysis based

on reasonably possible ch

anges of the

significant

assu

mptions as of December 31,

2021 and December 3

1, 2020,

while all the other

assumptio

ns are retained, are as follows

Effect on the net defined

benefit liabilities

December 31, 2021

December 31, 2020

Description

Increase

Decrease by 1%

Increase by 1%

Decrease by 1%

n millions of Korean Won

)

(In millio

ns of Korean Won)

Discount ra

୸

(486,472

)

୸

542,497

୸

(489,893

)

୸

578,549

Rate of expected future salary

increase

492,651

(457,048

)

529,477

(461,638

)

(6)

The fair val

e of the plan as

sets as of D

ecember 31

, 2021 an

d December 31, 2020 is as

follows.

Description

December 31, 2021

December 31, 2020

(In millio

ns of Korean Won)

Insur

ance in

strumen

୸

6,717,877

୸

6,249,450

Others

3,272

3,849

୸

6,721,149

୸

6,253,299

(7)

The G

roup expects t

o pay contribut

ion of appr

oximately

୸

562,448 m

illion to the pla

n in 2022 and the weighted

average duration

of the define

d benefit obligation as

of Dec

ember 31, 2021 is 8.

0 years.

ڒړٻ

36. CASH GENERATED FRO

M OPERATIONS:

(1)

Cash generated fr

om operations for the years ende

d December 31, 20

21 and 2020 are as f

ollows.

Description

2021

2020

(In millio

ns of Korean Won)

Profit for the year

୸

5,693,077

୸

1,924,553

Adjustments:



Retirement

benefit costs

602,406

621,381

Depreciation

2,937,914

2,749,51

Amortization

of intangible assets

1,61

7,823

1,435,86

Provisi

on for warrant

ies

2,678,95

4,619,51

Income tax expe

nse

2,266,48

168,703

Loss on forei

gn currency trans

lation, net

30,813

136,397

Loss on dis

posals

of PP&E, net

33,921

69,276

Interest i

ncome, net

(44,071)

(38,970)

Gain on share of ear

nings of e

quity-accounted inves

tees, net

(1,278,591)

(103,676)

Cost of s

ales from financi

al se

rvices, net

6,229,723

6,604,78

Impairment l

oss on inves

tments

in associat

13,332

Others

688,884

545,598

15,777,5

16,808,385

Changes in

operating

assets and liabilities:

Decrease (increase) in trade n

tes and accounts receivable

280,750

(130,504)

Increase in other receiva

bles

(161,098

)

(95,065)

Decrease (increase) i

n other fi

nancial ass

ets

237,835

(729,250)

Decrease (increase) i

n invento

ries

177,234

(39,007)

Increase in othe

r asset

(381,923

)

(510,142)

Increase in trade

notes and acc

ounts payable

555,739

1,517,93

Increase in othe

r payables

13,702

121,283

Increase in other liabilities

1,057,959

669,528

Decrease in other f

inancial liabilities

(

11,583)

(26,285)

Decrease in net defined bene

fit liabilities

(678,416)

(593,606)

Payment of severa

nce benefits

(79,930)

(130,839)

Decrease in provis

ions

(3,261,759)

(2,605,5

37)

Changes in financial services

eceivables

(9,551,305)

(10,253,

842)

Investment in

operating leases

(7,649,654)

(4,269,6

49)

Others

(835,327

)

83,214

(20,287,

776)

(16,991,

771)

Cash generated fr

om operations

୸

1,182,890

୸

1,741,167

(2)

Major non-cash t

ransactions n

ot stated on the consol

idated s

tatements of cas

h flows fro

m inves

ting and financi

activities for the years ended December 31, 2021 and 2020 are as follows.

Description

2021

2020

(In millio

ns of Korean Won)

Reclassi

fication of the cu

rrent porti

on of lo

ng-term debt

and debentures

୸

21,149,425

୸

19,220,065

Reclassi

fication of cons

truction-i

n-progress

to PP&E

3,843,940

4,211,393

Reclassification o

f constru

ction-in-prog

ress to intangible assets

123,107

194,505

Contribut

ions in ki

nd (rendering of

services

) in joint

venture

381,517

ڒڔٻ

(3)

Changes in liabilities arisin

g from financial activ

ities fo

r the year ended

December 31, 2021 are as follows.

Chan

es from no

n-cash transa

ctions

Descri

tion

Beginn

ing

of the

ear

Cash fl

ows

from

fina

ncin

activiti

Recla

ssifi

ed to

current

ortion

Effect of

exchan

ge rate

chan

Pres

ent v

alue

discou

nts

Others

(

)

End of

the

ear

(

In mil

lions o

f Korean W

)

Short-

term

borrow

ings

(inclu

ding

current

ortio

)

୸

29,884,675

୸

(19,812,

277)

୸

21,149,425

୸

1,649,562

୸

18,765

୸

776,588

୸

33,666,738

Long-t

erm

debts

12,726,724

3,853,657

(6,285,8

07)

338,631

10,831

23,695

10,667,7

Debent

ures

48,795,361

26,862,597

(14,863,618)

2,536,702

23,103

104,664

63,458,809

(*)

Other

s inclu

de trans

fers

from

or to ot

her accoun

ts and

other

Changes in liab

ilities arising from fin

ancial activities for

the year ended

Decemb

er 31, 2020 are as foll

ows.

Chan

es from no

n-ca

sh tran

sactio

Descri

tion

Beginn

ing

of the

ear

Cash fl

ows

from

fina

ncin

activiti

Recla

ssifi

ed to

current

ortion

Effect of

exchan

ge rate

chan

Pre

sent

valu

discou

nts

Others

(

)

End of

the

ear

(

In mil

lions o

f Korean W

)

Short-

term

borrow

ings

(inclu

ding

current

ortio

)

୸

28,349,251

୸

(17,547,

902)

୸

19,220,065

୸

(901,820

)

୸

41,183

୸

723,898

୸

29,884,675

Long-t

erm

debts

11,217,088

8,432,439

(6,406,4

92)

(477,249)

9,882

(48,944)

12,726,724

Debent

ures

41,805,814

21,894,431

(12,813,573)

,822,9

14)

21,329

(289,

726)

48,795,361

(*)

Other

s inclu

de trans

fers

from

or to ot

her accoun

ts and

other

37. RISK

NAGEMENT:

(1) Capital risk manageme

The Group man

ages its capital to maintain

an optimal capital structur

e for maximizing pr

ofit of its shareholder

and

reducing the cost of capital. Debt to equity ratio calculated as total liabilities d

ivided by total equity is used as an index

to manage

the Group’s capital. The overa

ll capital risk management policy

is consistent with that o

f the prior period. Debt

to equity ratios as of Decembe

r 31, 202

1 and December

31, 2020 are as

follows.

Description

December 31, 2021

December 31, 2020

(In millio

ns of Korean Won)

Total liabilities

୸

151,330,

626

୸

133,003,

242

Total equit

82,615,789

76,340,970

Debt-to-equit

y rati

183.2%

174.2%

(2) Fina

ncial ris

k manageme

The Group is exposed t

o vari

ous financial

risks s

uch as market

risk (forei

gn exchange ri

sk, interest rate ris

k and price

risk), credit

risk and liquidit

y risk rel

ated to i

ts financia

l instr

uments. The

purpose

of risk management

of the Gr

oup is to

identify po

tential risks related to fin

ancial performance and redu

ce, eliminate and evade those risks to an

acceptable level

of risks to t

he Group.

Overall,

the Group’s fi

nancial ris

k management

policy i

s consis

tent wit

h the prior perio

d policy.

ړڋٻ

1) Market

risk

The Group is

mainly e

xposed to financi

al ri

sks aris

ing from

cha

nges in foreign e

xchange rates and i

nteres

t rates.

Accordingly, t

he Gro

up uses

financial

derivative contract

s to

hedge and to manage its interest rate risk and foreign

currency risk.

Foreign exc

hange risk management

The Group is

exposed to vari

ous foreign excha

nge risks by

making tra

nsactions in forei

gn currencies. T

e Group is

mainly exposed t

o foreign exc

hange risk in USD, EUR

, JPY and others

The Group manages foreig

n exchange risk b

y matching the in

flow and the outflow of fo

ign currencies according to

each currency and maturity, a

d by adjusting the foreign currency settlement

date based on its exchange rate forecast.

The Group uses

foreign excha

nge derivatives, such as cur

rency forward, curre

ncy swap, and currency optio

n; as hedgin

instruments

. However, spec

ulative foreig

n exchange tra

e on derivative financial

instrume

nts is prohibited.

Sensitivity analysis for a 5% change in exch

ange rate of the functional currency against each foreign currency on profit

before income tax

as of Dece

mber 31, 2021 i

s as follow

Foreign Exchange Rate Sensitivity

Foreign Currency

Increase by 5%

Decrease by 5%

(In millions of Korean Won)

USD

୸

(81,434)

୸

81,434

EUR

(31,240)

31,240

JPY

(5,039)

5,039

Interest rate risk management

The Group has bor

rowings with fixed or vari

able interes

t rat

es. Als

o, the Group is expos

ed to i

nterest rate

risk arisi

from financia

l instrume

nts with variable i

nterest rates. To ma

nage the interest rate ris

k, the

Group mainta

ins an appro

priate

balance between

borrowings

wit

h fixed and varia

ble interes

rates

for short-te

rm borrowings and has

a polic

y to bor

row

funds with fi

xed interest rat

es to avoid t

he future cash fl

uctuation ris

k for long-t

erm debt

if poss

ible. The Grou

manages its

interest rat

e risk through regular as

sess

ments of

the change in market con

ditions and the adjustm

ents in natur

of its interest r

ates.

Sensitivity analysis for a 1

% change in interest rates on profit

before income tax as of December 31, 2021 is as follows.

Interest Rate Sensitivity

Accounts

Increase by 1%

Decrease by 1%

(In millions of Korean Won)

Cash and cas

h equivalents

୸

36,126

୸

(36,126)

Financial assets meas

ured at FVPL

(4,595)

4,964

Short-term an

d long-term

financial

instrument

14,696

(14,696)

Borrowings

and debent

ures

(81,572)

81,572

The Company’s s

ubsidiaries, Hyundai Ca

rd Co., Ltd. a

nd Hyundai Capital

Services, In

c., that are operating fina

ncial

business, are ma

naging interest rate risk by

utilizing value at

risk (VaR). VaR is d

efined as a th

reshold

value which is a

statistical estimate of the maximum potential loss

based on

normal dis

tribution. As of

December 31

, 2021 and December

31, 2020, t

he amounts of i

nterest rate ris

k measured at VaR are

୸

182,

864 m

illion and

୸

180,2

40 million, respectively.

c) Price risk

The Group is expos

ed to market price fl

uctuation risk aris

ing from e

quity instruments.

As of December 31, 20

21, the

amounts of fi

nancial ass

ets measured at

FVPL

and fina

ncial assets meas

ured at FVOCI are

୸

107,2

90 million

and

୸

2,460,812 m

illion, respectively.

ړڌٻ

edit risk

The Group is

exposed to c

redit ri

sk when a counterpart

y defaults on it

s contractual obl

igati

on resulting in a

financial loss

for the Group. The Gr

oup operates a poli

cy to transact w

ith counterpa

rties who onl

y meet a certai

n level of credit rat

ing

which was evaluated

based on the counter

rty’s

financial c

onditions, de

fault his

tory, an

d other fa

ctors. The

credit risk

in the liquid fun

ds and derivative financial

instrument

s is l

mited as t

he Group transacts

only with financi

al insti

tutions

with high credit

-ratings ass

igned by inter

national credit

-rating agencies

. Except for t

he guarantee of indebted

ness

discuss

ed in Note 39,

the book val

ue of fina

ncial ass

ets in the cons

olidated fi

nancial st

atements represent

s the ma

ximum

amounts of expos

ure to credit

risk. In additi

on, the Compa

ny’s subs

idiaries, Hyundai Card Co., Ltd. and H

yundai Ca

pital

Services, Inc., that are operating financial busin

ess, assesses

their credit stability

according to their internal credit ratin

and manage c

redit ris

k conce

ntrations by

debtor. As of

December

31, 2021, credit ri

sk concent

rations are 90% f

households an

d 10% for companie

Liq

uidity risk

The Group manages

liquidit

y ris

k based on maturity pr

ofile

of its funding. T

he Group ana

lyses and revi

ews actual cas

outflow and its b

udget to match the m

aturity of its financial liab

ilities to that of its fin

ancial assets.

The Group retai

ns an appropri

ate level of deposit t

o cope wit

uncertainty caused

by the inherent nature of t

he industry

which is sensitive to economic

fluctuati

on and to i

nvest in R&D constantly.

In addition, the Group has ag

reements with financial institu

tions related to trade financing and overdraft to mitigate any

significant

unexpected market

deterioration. A

lso, the Gr

oup continues

to strengt

en its credi

t rates to s

ecure a stable

financing capabi

lity.

The Group’s ma

turity analysis of its non-derivativ

e liabilities according to their remaining contract p

eriod before

expiration as of December

, 2021 is

as follows.

Remaining contract

period

Description

Not later than

one year

Later than one year and

not later than

five years

Later than

five years

Total

(In millions of Korean Won

)

Non-inter

est-

bearing liab

ilities

୸

16,973,694

୸

17,049

୸

16,990,743

Interest-bearing

liabilities

35,391,667

68,185,242

9,898,26

113,475,169

Financial

guarantee

818,566

7,085

825,651

The maturity anal

ysis i

s based on the non-

discounted cas

h flows

and the earliest

maturity date at w

hich payments

, i.e.

both principal

and interes

t, should be made.

(3) Derivative inst

ruments

The Group ent

ers int

o derivati

ve instrument cont

racts such

as currenc

y forwards, currency

options, cu

rrency swaps an

interest swaps to h

edge its exposure to

changes in foreign exchange rate or interest rate.

As of December 31,

2021 and

December 31, 2020, the

Grou

p recognized an accumulative

net profit of

୸

13,980 millio

and net profit of

୸

61,882 mi

llion, respect

ively, i

n accumu

lated other

comprehensive pr

ofit or loss, f

or effecti

ve cash

flow hedgi

ng instrume

nts.

The longest peri

od in which t

he forecasted transactions

are expected to occur is

within 93 months as of Decem

ber 31,

2021.

For the years ende

d December 31, 2021 an

d 2020, the Group recog

nized a net profit o

୸

675,508 million and net lo

ss of

୸

509,252 million in profit or

loss (before tax), respectively, wh

ich resulted from the ineff

ective portion of its cash flow

hedging inst

ruments and chan

ges in the valuation of

ts other non

-hedging

derivative instruments

and others.

ړڍٻ

In addition,

the Company’s s

ubsidiari

es, Hyundai

Card C

o. Ltd. and

Hyundai Ca

pital Se

rvices, Inc., that

are operatin

financial bus

iness, us

e interest rate

swaps and currency swaps

to hedge the ris

ks of future

cash flows,

which related t

borrowings

, debentures

and ot

hers, due t

o market inte

rest rat

fluctuat

ions and exc

hange rate fluctuati

ons. As o

f December

31, 2021, t

he average he

dge ra

tio is 100%

38.

RELATED-PARTY AND O

THER TRANSACTIONS:

The transactions

and balances

of receiva

es and

payables

within the Group are w

holl

eliminated in

the prepa

ration of

consolidated fina

ncial statements of t

he Group.

(1)

For the year ended December 31, 2

021

, significant transactions

arising fr

om operations be

tween

the Group

and

related parties or affiliates by t

he Monopoly Regulation an

d Fair Trade Act of t

he Republic of Korea

(“the

Act”)

are as follows.

Description

Sales/

proceeds

Purchases/expenses

Sales

Others

Purchas

Others

(In million

s of Korean Won)

Entity with

significant

influence over

the Company

and its

subsidiaries

Hyundai MOBIS

Co., Ltd.

୸

546,326

୸

141,828

୸

9,189,407

୸

80,346

Mobis Alabama, LLC

200,423

1,296

,680

47,303

Mobis Automotive Czech s.r.

501

1,948,940

12,268

Mobis India, Lt

12,150

2,664

1,060,774

2,263

Mobis Part

s America, LLC

111,1

3,564

1,067,076

1,140

Mobis Module C

IS, LLC.

315

419,772

Mobis Part

s Europe N.V.

16,986

1,450

473,989

746

Others

62,109

1,788

1,120,565

8,564

Joint ventures

and associates

Kia

Corporation

1,167

,895

726,215

732,297

786,682

Kia Russ

ia &

CIS, LLC

994,790

112

Kia

Slovakia s

.r.o..

97,731

281

671,653

Kia

Georgia, Inc

617,122

1,518

292

BHMC

321,700

115,309

18,080

HMGC

37,287

1,299

103,139

63,877

Hyundai

WIA Corpo

ration

135,431

1,605

1,280,719

14,51

Others

728,094

64,383

4,505

,972

1,816,502

Other related parties

16,780

14,627

3,927

Affiliates by th

e Act

769,822

118,065

8,566,617

922,130

ړڎٻ

For the year ende

d December 31, 2020,

gnificant transactions aris

ing from oper

ations be

tween the Group

and related

parties or af

filiates by the Act are as follo

ws.

Description

Sales/

proceeds

Purchases/expenses

Sales

Others

Purchas

Others

(In millions of Korean Won)

Entity with

significant

influence over

the Company

and its

subsidiaries

Hyundai MOBIS

Co., Ltd.

୸

1,182,103

୸

97,974

୸

7,608,254

୸

73,025

Mobis Alabama, LLC

228,571

1,853

1,253,91

8,791

Mobis Automotive Czech s.r.

530

1,752,089

28,556

Mobis India, Lt

9,665

2,508

842,492

16,874

Mobis Part

s America, LLC

73,764

3,541

906,939

729

Mobis Module C

IS, LLC.

323

337,999

Mobis Part

s Europe N.V.

17,863

4,667

365,834

Others

34,398

1,802

844,106

9,565

Joint ventures

and associates

Kia Motors C

orporation

981,100

674,137

337,027

705,038

Kia Motors R

ussia LLC

961,759

125

Kia Motors S

lovakia s.r.o.

98,792

3,060

395,545

Kia Motors Manufacturi

Georgia, Inc.

344,749

1,646

BHMC

232,357

97,181

15,277

HMGC

20,321

64,627

42,957

Hyundai WIA C

orporation

116,640

2,752

1,252,893

42,905

Others

711,231

61,490

4,051,200

1,809,744

Other relate

d parties

7,639

4,835

103

Affiliates by the Act

818,760

241,185

6,641,683

737,717

(2)

As of December 31, 2021, si

gnificant balances related to

the

transactions

between the Group and related

parties or

affiliates by the Act are as follows.

Description

Receivables (*

1,2)

Payables

Trade notes

and accounts

receivable

Other

receivables

and others

Trade notes

and accounts

payable

Other

payables

and others

(In millions of Korean Won

)

Entity with

significant

influence over

the Company

and its

subsidiaries

Hyundai MOBIS

Co., Ltd.

୸

92,116

୸

301,436

୸

1,687,603

୸

466,862

Mobis Alabama, LLC

14,344

108,355

Mobis Automotive Czech s.r.

901

194,217

Mobis India, Lt

1,370

123,770

Mobis Part

s America, LLC

31,309

101,750

Mobis Module C

IS, LLC

50,666

Mobis Part

s Europe N.V.

550

118

47,095

Others

11,339

491

101,671

6,947

Joint ventures

and associates

Kia

Corporation

328,668

335,571

84,505

121,814

Kia Russ

ia &

CIS, LLC

134,7

Kia Slovaki

a s.r.o.

6,832

279

46,18

205

Kia Georgia, Inc

91,109

64,378

11,120

96,639

Kia America, Inc.

149,910

BHMC

199,426

13,626

12,34

414

HMGC

6,019

21,752

4,479

37,996

Hyundai

WIA

Corporation

31,147

920

185,022

28,048

Others

209,556

69,666

679,046

920,138

Other relate

d parties

710

Affiliates by the Act

154,455

61,484

905,856

351,422

(*1) The Group h

as recogni

zed the loss allo

wance for th

e related part

ies' receiv

ables in

the amou

nt of

୸

209 millio

n as of D

ecembe

r 31,

2021 an

d the

reversa

l of im

pairme

nt loss is

rec

ognize

d in the a

mou

nt of

୸

56 million for the year ended December 31

, 2021.

(*2)

As o

f December 31,

2021, out

standin

g payment o

୸

22,0

96 milli

on of c

orporate p

rchase c

ard agr

eeme

nt provided b

y Hyunda

i Car

Co., L

td. is inclu

ded. For th

e year ended Decemb

er 31, 20

21, amoun

t used and

repayment o

f agreement are

୸

383,299 millio

n and

୸

406,133 m

illio

n, respe

ctive

ly.

ړڏٻ

As of December 31, 2020

, significant balances related t

e transactions

between the Group and related parties or

affiliates by the Act are as follows.

Description

Receivables (*

1,2)

Payables

Trade notes

and accounts

receivable

Other

receivables

and others

Trade notes

and accounts

payable

Other

payables

and others

n millions of Korean Won)

Entity with

significant

influence over

the Company

and its

subsidiaries

Hyundai MOBIS

Co., Ltd.

୸

305,479

୸

422,870

୸

1,326,453

୸

363,166

Mobis Alabama, LLC

10,425

135,098

3,116

Mobis Automotive Czech s.r.

160

236,598

2,420

Mobis India, Lt

2,021

172,639

Mobis Part

s America, LLC

19,410

73,30

Mobis Module C

IS, LLC

41,556

Mobis Part

s Europe N.V.

1,242

106

27,70

Others

5,121

1,404

74,319

8,078

Joint ventures

and associates

Kia Motors C

orporation

451,4

227,908

87,563

173,321

Kia Motors R

ussia LLC

136,195

Kia Motors S

lovakia s.r.o.

7,501

676

55,316

Kia Motors Manufacturi

Georgia,

Inc.

57,050

96,725

2,292

4,517

Kia Motors Ameri

ca, Inc.

93,361

19,491

BHMC

84,642

15,409

7,552

1,801

HMGC

16,103

19,546

10,739

28,404

Hyundai WIA C

orporation

34,683

10,120

206,312

44,536

Others

240,510

59,201

693,955

901,694

Other relate

d parties

600

Affiliates by the Act

166,666

35,421

991,058

337,537

(*1) The Group h

as recogni

zed the loss allo

wance for th

e related part

ies' receiv

ables in

the amou

nt of

୸

265 million a

s of December

31,

2020 an

d the r

evers

al of

impairm

ent lo

ss is reco

gnized in

the amo

unt of

୸

171 million for the year en

ded December 31

, 2020.

(*2)

As o

f December 31,

2020, out

stand

ing paymen

t of

୸

44,930

million

of corporate p

urchase ca

rd agre

ement prov

ided by Hy

undai Ca

Co., L

td. is includ

ed. For the y

ear ended Decemb

er 31, 20

20, amount

used and rep

ayment of ag

reement are

୸

296,

011 millio

n and

୸

272,308 m

illio

n, respe

ctive

ly.

(3)

Significant fund transactions a

equity contri

bution transac

tions for the

year ended

December 31,

2021,

between

the Group and

related partie

s are as

follows.

Loans

Borrowings

Equity

Description

Lending

Collection

Borrowin

Repaym

ent

contrib

ution

(In m

illions of Korean won)

Joint ventures and ass

ociates

୸

7,600

୸

313,720

Significant fund transacti

ons a

nd equity contri

bution t

ransactions for the

year

ended

December 31, 2020, between

the Group and related par

ties

are as follows.

Loans

Borrowings

Equity

Description

Lending

Collection

Borrowing

Repaymen

contr

ibution

(In thousa

nds of US

D Dollar and C

hinese Yuan, In mi

llions

of Korean won)

Joint ventures and ass

ociates

ଋ

5,000

$ 5,000

୸

1,867,971

୸

16,000

For the years ended Decem

ber 31, 2021

nd 2020, the G

roup received dividends

୸

9,957 m

illion

and

୸

213,

820

million from

related pa

rties and affiliates

by the Act,

respectively and

paid divi

dends of

୸

322,421 million and

୸

240,877 million to related p

arties, respectiv

ely. During

2021, the Gr

oup traded in

othe

r financial assets and others of

୸

2,660,000 million with HYUNDAI MOTOR

SECURITIES Co., Ltd

., an associate of the Grou

p. The Group has

other fin

ancial assets of

୸

555,000 million in the cons

olidated

tatement of financial position as

of December 31, 2

021.

ړڐٻ

For the years ended Decem

ber 31, 2021

, and 2020, HYUNDAI

MOTOR

SECURITIES CO., Ltd., an associate of the

Group, acquired bo

nds issued by the cons

lidated entities, Hyundai C

apital Services

Inc. a

nd Hyundai Card Co, Ltd. in

amount of

୸

30,000 million

and

୸

70,000 million respectively.

(4)

Compensation of

registered an

d unregis

tered directo

rs,

who

are considered t

o be the key m

anagement

personnel

for the years ende

December 31, 2021 a

nd 2020 are as follows

Description

2021

2020

(In millions of Korean Won)

Short-term em

ployee salari

୸

296,733

୸

270,833

Retirement benefit costs

48,906

45,683

Other long-term be

nefits

1,209

964

୸

346,848

୸

317,480

(5)

For the year ende

d December 31, 2021,

the Group offer pa

ment guarantee to related parti

es and affiliates by the

Act.

39. COMMITMEN

TS AND C

ONTINGENCI

ES:

(1)

As of December 31, 2021

, the debt guarantees prov

ided

by the Group, exclu

ing the ones

provide

d to the

Company’s subs

idiaries are as follows

Description

Domestic

Overseas

(

(In millions of Korean Won

)

To associates

୸

28,299

୸

101,470

To others

6,381

821,942

୸

34,680

୸

923,412

(*)

e guarantee amo

unts in

foreign currenci

es are translat

ed into Korean W

on using

the Base Rate anno

unced by

Seoul Money

Brokerag

e Services, Ltd

. as of December 31, 2021

(2)

As of December 31, 2021, the

Group is involved in domestic

and fo

reign lawsuits as a

defendant.

In addition, the

Group is involved in laws

uits for pro

duct liabilities and

hers. The Group obtains ins

urance for potential loss

which may

result from product liabilities and

other lawsuits. I

n addition

, as of December 31, 2021,

the Group is

under investigation b

y related authorities in relation to t

e theta 2 engine

recall, and its results and impacts are

unpredicta

ble. The Group is

unable to estimate the outco

me of the lawsuits

and the amou

nt and timing

of outflows

of resources are uncert

ain. The Group ex

pects that the i

mpact on the consolidated fi

nanci

al statement

s will not be

material.

(3)

As of December 31, 2021

, a subs

tantial portion of the Grou

p’

s PP&E is pledged as collat

eral for various loans an

leasehold depos

its up t

୸

8,163 milli

on. In addi

tion, the

Group pledged

certai

bank

deposit

checks

and

promisso

ry notes, in

cluding 213,4

66 shares of Kia Co

rporation

, as collateral to fin

ancial institutio

ns and oth

ers.

Certain receivables held by

the Company’s foreign su

bsidia

ries, such as financial services

receivables are pledged

as collateral for th

eir borrowings.

(4)

As of December 31,

2021, the

Group has ove

rdrafts

, genera

loans, and trade-

financing ag

reements with numerous

financial institutions includi

ng Kookmi

n Bank, with

a combi

ned limit of up to

USD 27,500 million, and

୸

5,527

,400

million.

(5)

As of December 31, 2021, Hyundai C

apital Services, Inc. an

d Hyundai Card Co., Ltd. ha

ve entered into agreements

for certain borrowi

ngs inclu

ding trigger claus

es for the purp

ose of credit enhancement. If t

he credit rating of H

yundai

Capital Services, Inc. an

d Hyun

dai Card Co., Ltd

. falls belo

w a certain leve

l, this may re

sult in early rep

ayment of

the borrowings

or termi

nation

of the contracts

(6)

As of December 31,

2021, Hyundai

Capital Services, I

c. and Hyu

ndai Card C

o., Ltd., the

subsidiaries of the

Company are able to e

xercise the prio

rity

purchasing ri

ghts for t

he leased

office buildi

ng when the les

sor wants

sell t

he building or afte

r 4 yea

rs and 5 months

from the

lease contract commencement

date.

ړڑٻ

(7)

As of December 31, 2021, the

Company’s total return swap co

ntract is terminated u

pon the

sale of stocks of Hyun

dai

Capital Services, Inc., th

e subsidiary of the Company, h

eld by the third party investo

(8)

As of December 31, 202

1, the Company has a s

hareholder a

gre

ement with investors

of thir

d parties regardin

g shares

of Hyundai Card C

o., Ltd. and Hyundai C

ommercial Inc. Thi

s includes t

he call options that all

ow the Company to

buy shares from t

he inves

tors and t

he put o

ptions that al

low the inves

tors to dis

pose of t

he shares t

o the Company.

(9)

In December 2019, t

he Compa

ny entered into a

n agreement t

o invest

୸

1,408,220 m

illion in the construction

of new

Global Business

Centre (GB

C). As of December 31, 20

21, the Company

has recognized relevant liability in

the

amount of

୸

937,

555 million in accord

ance with the a

greement

with the Seoul gove

rnment to implement publi

contributio

ns relating to the ne

w construction proj

ect.

(10)

As of December

31, 2021

, the Compa

y entered into

purchase agreeme

nt with the third party i

nvestor

regarding shares

of Bos

ton Dynami

cs, Inc. The

shareholder contract

contains

put o

ptions

that give the

investor the

right to sel

l its s

hares to the Purchasers, i

ncluding the C

mpany, and the Pu

rchasers are jointly and severall

responsible for the put rights. The total

amount of a

dditional obligation of the

Company i

n the event of de

faults of

the other Purchas

ers is

୸

88,566 millio

(11)

Financial instruments with re

strict

ed use

for the years ended

December 31, 20

21 and 2020 are as

follows.

Description

December 31, 2021

December 31

, 2020

(In millions of Korean Won)

Short-term an

d long-term

financial

instrum

ents

୸

1,694,904

୸

840,628

Cash and cas

h equivalents

225,731

113,799

Other financial

assets

7,969

୸

1,920,637

୸

962,396

40. SEGMENT

INFORMAT

ION:

(1) The Group has vehi

cle segm

ent, finance segment

and oth

ers segment

. The vehicle segment

is engaged in the

manufacturing and

sale of m

otor vehicles

. The finan

ce segm

ent operates vehicle fina

ncing, credit card process

ing

and other financin

g activities. Others segment in

cludes the R&D, train manufactu

ring and other activities.

(2)

Sales and operating profit by

operating segments for the

yea

rs ended December 3

1, 2021 and 20

20 are as follows.

For the year ende

d December 31, 2021

(*1)

Ope

rating pr

ofit of

the vehicle s

egm

ent incl

ude i

nternal

transa

ction a

djustments

(*2)

Net sales rep

resent sales fro

m external cu

stomers.

Vehicle

(*1)

Finance

Others

Total

Net sales

(*2)

୸

94,143,019

୸

16,782,412

୸

6,685,195

୸

117,610,

626

Operating

profit

4,155,76

2,195,377

327,807

6,678,949

Inter-company

sales

(52,033,

375)

(318,479)

(1,352,273)

(53,7

04,127)

ړڒٻ

For the year ende

d December 31, 2

020

Veh

icle

(*1)

Finance

Others

Total

Net sales

(*2)

୸

80,577,320

୸

16,848,079

୸

6,572,202

୸

103,997,

601

Operating

profit

728,139

1,367,913

298,619

2,394,67

Inter-company

sales

(42,456,564)

(353,708)

(1,483,9

13)

(44,294,185)

(*1)

Incl

udes operati

ng profit related

to internal tran

saction adjust

ments.

(*2)

Sales fro

m external cu

stomers.

(3)

Assets and liab

ilities by ope

rating segments as

of December 31, 2021 are as follows.

December 31, 2021

Vehicle

Finance

Others

Consolidatio

adjustments

Total

(In million

s of Korean Won)

Total assets

୸

121,826,

011

୸

120,951,

619

୸

8,836,191

୸

(17,667,

406)

୸

233,946,

415

Total liabilities

54,135,289

104,597,059

5,199,761

(12,601,483)

151,3

30,626

Borrowings

and debent

ures

12,568,592

96,73

4,509

2,569,958

(4,079,7

81)

107,793,278

Assets and liabilities by operat

ing segments as of December

31, 2020 are as

follows.

December 31, 20

Vehicle

Finance

Others

Consolidatio

adjustments

Total

(In millions of Korean Won)

Total assets

୸

115,561,

852

୸

102,201,

169

୸

8,532,445

୸

(16,951,

254)

୸

209,344,

212

Total liabilities

50,893,713

88,267,154

5,182

,892

(11,340,517)

133,003,

242

Borrowings

and debent

ures

10,920,355

80,44

0,613

2,520

,615

(2,47

4,823)

91,406,760

(4)

Sales by regio

n based on where the Group’s entities are located f

or the years ended December 31, 2021 and 2020

are as follows.

For

the

ear ended Decemb

er 31, 2021

Korea

North

America

Asia

Euro

e Others

tal

(In millions of Korean Won

)

Net sales

୸

41,33

2,243

୸

40,75

0,484

୸

11,39

0,768

୸

21,50

8,735

୸

2,628,

396

୸

117,610,

626

For the

ear ended Decemb

er 31, 20

Korea

North

America

Asia

Europe

Others

Total

(In millions of Korean Won)

Net sales

୸

40,28

4,242

୸

36,62

8,365

୸

8,752,

024

୸

16,44

7,637

୸

1,885,

333

୸

103,997,

601

ړړٻ

(5)

Non-current assets by regio

n wher

e the Group’s entities are

located in as

of December 31,

2021 and December

31,

2020 are

as follows.

Description

December 31,

2021

December 31,

2020

(In millions of Korean Won)

Korea

୸

33,323,986

୸

32,562,450

North America

2,967,662

2,691,789

Asia

2,781,728

2,429,368

Europe

2,254,395

2,234,466

Others

520,729

354,279

41,848,500

40,272,352

Consoli

dation adjus

tments

(301,775

)

(341,589)

Total (*)

୸

41,546,725

୸

39,930,763

(*)

Total amou

nt is the sam

e as sum

mation of PP&

E, inta

ngible assets and i

nvestment

properties.

(6)

There is no si

ngle external

customer w

ho represents

10% or more of the Gro

up’s revenue

for the years ended

December 31, 2021 a

nd 2020.

41. CONSTRUCTION

CONTR

ACTS:

(1)

Cost, i

ncome and loss and

claimed construct

ion fr

om const

ruction in prog

ress as of December 31, 2

021 and

December 31, 2020 a

re as follows.

Description

December 31,

2021

December 31,

2020

(In millions of Korean Won)

Accumulated cost

୸

12,658,465

୸

11,602,563

Accumulated income

146,975

254,593

Accumulated co

nstructi

on in process

12,805,440

11,857,156

Progr

ess billing

12,286,456

11,460,905

Due from cust

omers

1,421,108

1,252,117

Due to customers

902,124

855,866

Reserv

e (*)

79,161

95,459

(*)

Reserve is

recogni

zed as long-term t

rade no

tes and accoun

ts receivable i

n the conso

lidated finan

cial statements.

(2)

Effects on

profit or l

oss of

current an

d future

periods

, due

from cust

omers

related t

o changes

in account

ing est

imates

of total contract

revenue and t

tal contract

costs of ongoi

contracts of Hyun

dai Rotem, a subsidiary of t

he Company,

as of December 31,

2021 are a

s follows.

Description

December 31, 20

(In millions of Korean Won)

Changes in accounting estimates

of total contract revenue

୸

154,893

Changes in

accounting estimates o

f total contr

act costs

134,441

Effects on profi

t or loss

of current

period

(3,913)

Effects on profi

t or los

s of future peri

ods

24,365

Changes in due from customers

50,544

Provisi

on for const

ructio

n loss

46,357

Effects on profi

t or loss

of current and future peri

ods were

calculated with estimated

total con

tract costs and estima

ted

total contract re

venue based on

factors that are

considered to b

e relevant from

commencement of the cont

ract to Decembe

31, 2021. Total co

ntract revenue and c

osts may change in future perio

(3)

There is no contract as

of Dece

mber 31, 2021, i

n which co

ntract revenue

is recognized

by the pro

portion of c

ontract

costs incurred, t

hat accounte

d for more than 5% of t

e Group'

s revenue in the prior period

ړڔٻ

42.

BUS

INESS CO

MBINA

TIONS:

(1) For the year ended December 31, 2021, the Group acq

uired 50% of the shares of the HYUNDAI THANH CONG

VIET NAM AUTO JOINT VENTURE JOINT STOCK CO

MPANY (HTV).

The accounting for the business combination

at the acquisitio

n date is as follows.

Descri

ption

Amount

(In millions of Korean Won)

Total consi

derations trans

ferre

୸

285,050

Non-con

trolling intere

sts

202,039

Assets and liab

ilities acquired:

Current assets

110,151

Non-current assets

366,471

Property,

plant and eq

uipment

1,007

Intangibl

e assets

361,238

Others

4,226

Current liab

ilities

190

Non-current liab

ilities

72,354

Fair value of

identifiable net assets

404,078

Goodwill

83,011

The amounts of sales an

d net profit of the acquiree since the acqu

isition date included

in the consolidated statement of

income for the

year ended De

cember 31, 2021 a

୸

1,348,

323 m

illion and

୸

92,168 million, respectively

(2) For the year

ended December 31

, 2021, the Group acq

uired 82

.48% of the shar

es of the AirPlug Inc.

The accounting for the business combination

at the acquisitio

n date is as follows.

Descri

ption

Amount

(In millions of Korean Won)

Total consi

derations trans

ferre

୸

24,472

Non-con

trolling intere

sts

Assets and liab

ilities acquired:

Current assets

3,720

Non-current assets

2,252

Current liab

ilities

927

Non-current liab

ilities

517

Fair value of

identifiable net assets

4,528

Goodwill

19,975

The amounts of s

ales and net

profit of the acquiree si

nce the

acquisition date included in th

e consolidated statement of

loss for the year

ended December 31, 2021 are

୸

870 million and

୸

2,098 million,

respectively.