Edgar Filing: KOREA ELECTRIC POWER CORP

Form 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

Pursuant to Rule 13a-16 or 15d-16

of the Securities Exchange Act of 1934

For the Month of September 2015

Commission File Number: 001-13372

KOREA ELECTRIC POWER CORPORATION

(Translation of registrant’s name into English)

55 Jeollyeok-ro, Naju-si, Jeollanam-do, 520-350, Korea

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F x Form 40-F ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ¨

Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes ¨ No x

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- .

This Report of Foreign Private Issuer on Form 6-K is deemed filed for all purposes under the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended.

QUARTERLY BUSINESS REPORT

(For the period from January 1, 2015 to June 30, 2015)

THIS IS A SUMMARY IN ENGLISH OF THE QUARTERLY BUSINESS REPORT ORIGINALLY PREPARED IN KOREAN AND IS IN SUCH FORM AS REQUIRED BY THE FINANCIAL SERVICES COMMISSION OF KOREA.

IN THE TRANSLATION PROCESS, SOME PARTS OF THE REPORT WERE REFORMATTED, REARRANGED OR SUMMARIZED FOR THE CONVENIENCE OF READERS. NON-MATERIAL OR PREVIOUSLY DISCLOSED INFORMATION IS OMITTED OR ABRIDGED.

UNLESS EXPRESSLY STATED OTHERWISE, ALL INFORMATION CONTAINED HEREIN IS PRESENTED ON A CONSOLIDATED BASIS IN ACCORDANCE WITH INTERNATIONAL FINANCIAL REPORTING STANDARDS ADOPTED FOR USE IN KOREA, OR K-IFRS, WHICH DIFFER IN CERTAIN RESPECTS FROM GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN CERTAIN OTHER COUNTRIES, INCLUDING THE UNITED STATES. WE HAVE MADE NO ATTEMPT TO IDENTIFY OR QUANTIFY THE IMPACT OF THESE DIFFERENCES.

I. Company Overview

1. Name of the company: Korea Electric Power Corporation (KEPCO)

2. Information of the company

(Address) 55 Jeollyeok-ro, Naju-si, Jeollanam-do, 520-350, Korea

(Phone number) 82-61-345-4261

(Website) http://www.kepco.co.kr

3. Major businesses

KEPCO, as the parent company, is engaged in the following activities:

development of electric power resources;

generation, transmission, transformation and distribution of electricity and other related activities;

research and development of technology related to the businesses mentioned above;

overseas business related to the businesses mentioned above;

investment or contributions related to the businesses mentioned above;

development and operation of certain real estate holdings; and

other businesses entrusted by the government.

Businesses operated by KEPCO’s major subsidiaries are as follows: nuclear power generation by Korea Hydro & Nuclear Power (KHNP), thermal power generation by Korea South-East Power (KOSEP), Korea Midland Power (KOMIPO), Korea Western Power (KOWEPO), Korea Southern Power (KOSPO) and Korea East-West Power (EWP), other businesses including engineering service by KEPCO Engineering & Construction (KEPCO E&C), maintenance and repair of power plants by KEPCO Plant Service & Engineering (KEPCO KPS), nuclear fuel processing by KEPCO Nuclear Fuel (KEPCO NF), IT service by KEPCO KDN, and other overseas businesses and related investments.

4. Subsidiaries and affiliates of KEPCO

(As of June 30, 2015)


Classification	Consolidated subsidiaries		Associates and joint ventures		Total
Domestic		17		53		70
Overseas		59		37		96
Total		76		90		166

5. Major changes in management for six-month period ended June 30, 2015

At the annual general meeting of shareholders of KEPCO held on March 31, 2015, Mr. Jang, Jae-Won was appointed as a standing director in lieu of Mr. Goo, Bon-Woo whose the term of office expired, and Mr. Sung, Tae-Hyun, a non-standing director, was appointed as a member of the audit committee.

6. Information regarding KEPCO shares

A. Issued share capital: Won 3,210 billion (Authorized capital: Won 6 trillion)

B. Total number of issued shares: 641,964,077

(Total number of shares authorized to for issuance: 1,200,000,000)

C. Dividends: Dividend payment of Won 500 per share for fiscal year 2014 (Won 321 billion in aggregate). Dividend payment for fiscal year 2013 was Won 90 per share and no dividend was paid for fiscal year 2012.

II. Business Overview

1. Summary of consolidated financial results by segment for six-month periods ended June 30, 2014 and 2015

(In billions of Won)


	January to June 2014				January to June 2015
	Sales		Operating profit		Sales		Operating profit
Electricity sales		27,592		-454		28,498		1,931
Nuclear generation		4,796		1,593		4,638		1,192
Thermal generation		13,054		822		10,710		1,034
Others(*)		1,452		211		1,485		164
Subtotal		46,894		2,172		45,331		4,321
Adjustment for related- party transactions		-19,232		-116		-16,535		7
Total		27,662		2,056		28,796		4,328

•	The figures may not add up to the relevant total numbers due to rounding.

(*)	Others relate to 69 subsidiaries including KEPCO E&C, KEPCO KPS, KEPCO NF and KEPCO KDN, among others.

•	Sales and operating profit reflects amendments to Korean IFRS 1001 “Presentation of Financial Statements.”

2. Changes in unit prices of electricity

(In Won per kWh)


Business sector		Company	April to June 2015	January to December 2014
Electricity sold to end users	Residential	KEPCO	124.49	125.14
	Commercial		126.11	129.75
	Educational		107.90	114.15
	Industrial		105.05	106.83
	Agricultural		47.58	47.31
	Street lighting		114.38	113.39
	Overnight usage		67.54	67.33
Electricity sold to KEPCO	Nuclear Generation	KHNP	59.67	59.23
	Thermal generation	KOSEP	70.14	67.96
		KOMIPO	89.21	99.24
		KOWEPO	89.06	99.34
		KOSPO	89.67	108.67
		EWP	82.30	91.18

3. Electricity purchased from generation companies for six-month period ended June 30, 2015


Company	Volume (MWh)		Expense (In billions of Won)
KHNP		76,743,520		4,585
KOSEP		34,497,312		2,283
KOMIPO		21,298,953		1,847
KOWEPO		24,084,657		2,146
KOSPO		23,522,627		2,111
EWP		23,799,929		1,959
Others		46,591,376		5,930
Total		250,538,374		20,861

•	Excludes expense related to the Renewable Portfolio Standard provisions.

4. Intellectual property as of June 30, 2015

Patents

Utility

models

Designs

Trademarks

Total

Domestic

Overseas

Domestic

Overseas

Number of

registrations

5,236

669

843

176

399

7,414

III. Financial Information

1. Condensed consolidated financial results as of and for six-month periods ended June 30, 2014 and 2015

(In billions of Won)


Consolidated statements of financial position							Consolidated statements of comprehensive income
	Dec. 31, 2014		June 30, 2015		Change (%)			January to June 2014		January to June 2015		Change (%)
Total assets		163,708		170,083		3.9	Sales		27,662		28,796		4.1
Total liabilities		108,883		113,030		3.8	Operating profit		2,056		4,328		110.5
Total equity		54,825		57,053		4.1	Net income		753		2,565		240.6

2. Condensed separate financial results as of and for six-month periods ended June 30, 2014 and 2015

(In billions of Won)


Separate statements of financial position							Separate statements of comprehensive income
	Dec. 31, 2014		June 30, 2015		Change (%)			January to June 2014		January to June 2015		Change (%)
Total assets		99,719		104,027		4.3	Sales		27,592		28,498		3.3
Total liabilities		56,338		59,016		4.8	Operating profit		-454		1,931		n/m
Total equity		43,381		45,011		3.8	Net income		-543		1,929		n/m

(. )	n/m means not meaningful.

IV. Board of Directors (KEPCO Only)

1. The board of directors is required to consist of not more than 15 directors including the president and there may not be more than seven standing directors including president, and more than eight non-standing directors.

*	The Audit Committee consists of one standing director and two non-standing directors.

2. Board meetings and agendas for the first-six month period ended June 30, 2015


Number of meetings	Number of agendas	Classification
Number of meetings	Number of agendas	Resolutions	Results	Reports	Results
6	24	17	Approved as proposed	7	Accepted as reported

*	The audit committee held 4 meetings with 14 agendas (of which, 7 were resolved as proposed and 7 were approved as reported).

3. Major activities of the Board of Directors for six-month period ended June 30, 2015


Date	Agenda	Results	Type
January 16, 2015	Report on regional cooperation business such as the energy valley composition project in Naju, Korea	Accepted as reported	Report
January 16, 2015	Report on plans for the construction expenses for the new transmission lines in Dangjin, Korea	Accepted as reported	Report
February 27, 2015	Recommendation of candidates to become a member of the Audit Committee	Approved as proposed	Resolution
	Approval of the maximum aggregate amount of remuneration for directors in 2015	Approved as proposed	Resolution
	Approval of consolidated and separate financial statements for the fiscal year 2014	Approved as proposed	Resolution
	Approval to call for the annual general meeting of shareholders for the fiscal year 2014	Approved as proposed	Resolution
	Approval of the establishment of the new district offices	Approved as proposed	Resolution
	Approval of establishment of a special purpose company and investment for supporting the communities surrounding transmission lines	Approved as proposed	Resolution
	Report on the annual management of commercial papers in 2014	Accepted as reported	Report
	Report on internal control over financial reporting for the fiscal year 2014	Accepted as reported	Report
	Evaluation report on internal control over financial reporting for the fiscal year 2014	Accepted as reported	Report
	Auditor’s report to the board of directors for 2014	Accepted as reported	Report


Date	Agenda	Results	Type
April 17, 2015	Approval to close the shareholders’ registry for extraordinary general meeting of shareholders	Approved as proposed	Resolution
	Amendments on the regulation for remuneration and welfare	Approved as proposed	Resolution
	Approval to invest in Intra-company Employee Welfare Fund in 2015	Approved as proposed	Resolution
	Approval to invest in nurturing fund for small- and medium-sized enterprises	Approved as proposed	Resolution
	Approval to change management planning for technical development	Approved as proposed	Resolution
May 15, 2015	Approval to establish and finance a Special Purpose Company to make Ulleungdo eco-friendly energy self-sufficient	Approved as proposed	Resolution
	Approval of establishment and investment for a local subsidiary to conduct the Fujeij wind farm project in Jordan	Approved as proposed	Resolution
	Report on results of external and internal audits for the first quarter of 2015	Accepted as reported	Report
June 5, 2015	Amendments on the Electricity Usage Agreement and Rules for Operation	Approved as proposed	Resolution
June 19, 2015	Composition of the Director Nomination Committee to recommend candidates for non-standing directors	Approved as proposed	Resolution
	Approval of mid-to-long term financial management plan for the fiscal years from 2015 to 2019	Approved as proposed	Resolution
	Approval to establish a Special Purpose Company to begin charging fees for recharging electric vehicles	Approved as proposed	Resolution

4. Major activities of the Audit Committee


Date	Agenda	Results	Type
February 27, 2015	Auditor’s report on the agendas for the annual general meeting of shareholders	Approved as proposed	Resolution
	Audit plans for 2015	Approved as proposed	Resolution
	Report on internal control over financial reporting for the fiscal year 2014	Accepted as reported	Report
	Education plans for auditors for 2015	Accepted as reported	Report
	Auditor’s report on the audit results for 2014	Accepted as reported	Report
March 20, 2015	Approval of selection of independent auditors of subsidiaries	Approved as proposed	Resolution
March 20, 2015	Independent auditor’s report on the audit results for the consolidated and separate financial statements for the fiscal year 2014	Accepted as reported	Report
April 16, 2015	Approval of selection of independent auditors of subsidiaries	Approved as proposed	Resolution
	Auditor’s report for fiscal year 2014 in accordance with U.S. accounting principles	Accepted as reported	Report
	Report on the Form 20-F for the fiscal year 2014 to be filed with the U.S. SEC	Accepted as reported	Report
May 15, 2015	Amendments on the Charter of Ethics for KEPCO Employees and the Code of Conductor for KEPCO Executives and Staff members	Approved as proposed	Resolution
	Amendments on guidelines for disciplinary actions	Approved as proposed	Resolution
	Prior approval for non-audit service for subsidiaries by the independent auditor	Approved as proposed	Resolution
	Independent auditor’s report on the audit plans for fiscal year 2015	Accepted as reported	Report
	Report on results of external and internal audits in the first quarter of 2015	Accepted as reported	Report

The audit department, organized under the supervision of the Audit Committee, conducts internal audit over the entire company and takes administrative measures as appropriate in accordance with relevant internal regulations. KEPCO’s District Divisions and Branch Offices also have separate audit teams which conduct internal inspections with respect to the relevant divisions or offices.

V. Shareholders

1. List of shareholders as of May 6, 2015


		Number of shareholders		Shares owned		Percentage of total (%)
Government of the Republic of Korea			1		116,841,794		18.20
Korea Development Bank			1		211,235,264		32.90
Subtotal			2		328,077,058		51.10
National Pension Service			1		45,608,271		6.64
Public (non-Koreans)	Common shares		1,430		160,998,099		25.08
Public (non-Koreans)	American depositary shares (ADS)		1		35,516,861		5.53
Public	Corporate		1,359		51,433,844		8.01
(Koreans)	Individual		356,092		23,329,944		3.64
Total			358,885		641,964,077		100.00

•	Percentages are based on issued shares of common stock.

•	All of our shareholders have equal voting rights.

•	Citibank, N.A. is the depositary bank of our ADS which represents one-half of one share of common stock.

VI. Directors and employees as of and for the six-month period ended June 30, 2015 (KEPCO Only)

1. Directors

(In thousands of Won)


Type	Number of directors		Total remuneration		Average remuneration per person
Standing director		7		693,847		99,121
Non-standing director		8		105,000		13,125
Total		15		798,847		53,256

2. Employees

(In thousands of Won)


Type	Number of employees						Average continuous service year		Total salaries		Average salaries per person
Type	Regular		Non- regular		Total		Average continuous service year		Total salaries		Average salaries per person
Male		16,539		258		16,797		19.7		661,597,163		39,388
Female		3,453		115		3,568		14.0		101,663,047		28,493
Total		19,992		373		20,365		18.7		763,260,210		37,479

VII. Other Information Necessary for the Protection of Investors

1. Summary of the annual general meeting of shareholders (“AGM”) for the fiscal year 2014


Type	Agenda	Results
Annual General Meeting held on March 31, 2015	Approval of financial statements for the fiscal year 2014	Approved as proposed
	Approval of the maximum aggregate amount of remuneration for directors in 2015	Approved as proposed
	Election of a standing director: Mr. Chang, Jae-Won	Approved as proposed
	Appointment of a non-standing director as a member of the Audit Committee: Mr. Sung, Tae-Hyun	Approved as proposed

2. Pending legal proceedings as of June 30, 2015

(In billions of Won)


Type	Number of lawsuits	Amount claimed
Lawsuits where KEPCO and its subsidiaries are engaged as the defendants	747	477
Lawsuits where KEPCO and its subsidiaries are engaged as the plaintiffs	176	433

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


By:		/s/ Lee, Sang-Lyong
Name:		Lee, Sang-Lyong
Title:		Head of Finance & IR team

Date: September 9, 2015

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Consolidated Interim Financial Statements

June 30, 2015

(Unaudited)

(With Independent Auditors’ Review Report Thereon)

INDEX TO FINANCIAL STATEMENTS


	Page

Independent Auditors’ Review Report		1

Consolidated Interim Statements of Financial Position		2

Consolidated Interim Statements of Comprehensive Income (Loss)		4

Consolidated Interim Statements of Changes in Equity		6

Consolidated Interim Statements of Cash Flows		8

Notes to the Consolidated Interim Financial Statements		10

Independent Auditors’ Review Report

Based on a report originally issued in Korean

The Board of Directors and Shareholders

Korea Electric Power Corporation

Reviewed financial statements

We have reviewed the accompanying consolidated interim financial statements of Korea Electric Power Corporation and its subsidiaries (the “Company”), which comprise the consolidated statement of financial position as of June 30, 2015, the consolidated statements of comprehensive income (loss) for the three and six-month periods ended June 30, 2015 and 2014, changes in equity and cash flows for the six-month periods ended June 30, 2015 and 2014 and notes, comprising a summary of a significant accounting policies and other explanatory information.

Management’s responsibility

Management is responsible for the preparation and fair presentation of these consolidated interim financial statements in accordance with Korean International Financial Reporting Standards (“K-IFRS”) 1034, ‘Interim Financial Reporting’ and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ review responsibility

Our responsibility is to issue a report on these consolidated interim financial statements based on our reviews.

We conducted our reviews in accordance with the Review Standards for Quarterly and Semiannual Financial Statements established by the Securities and Futures Commission of the Republic of Korea. A review of interim financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Korean Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our reviews, nothing has come to our attention that causes us to believe that the accompanying consolidated interim financial statements referred to above are not prepared, in all material respects, in accordance with K-IFRS 1034, ‘Interim Financial Reporting’.

Other matters

The procedures and practices utilized in the Republic of Korea to review such consolidated interim financial statements may differ from those generally accepted and applied in other countries.

We have previously audited, in accordance with Korean Standards on Auditing, the consolidated statement of financial position of the Company as of December 31, 2014, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the year then ended, which are not accompanying this report, and we expressed an unqualified opinion on those consolidated financial statements in our report dated March 23, 2015. The accompanying consolidated financial position of the Company as of December 31, 2014, is consistent, in all material respects, with the audited consolidated financial statements from which it has been derived.

LOGO

KPMG Samjong Accounting Corp.

Seoul, Korea

August 13, 2015

This report is effective as of August 13, 2015, the review report date. Certain subsequent events or circumstances, which may occur between the review report date and the time of reading this report, could have a material impact on the accompanying consolidated interim financial statements and notes thereto. Accordingly, the readers of the review report should understand that the above review report has not been updated to reflect the impact of such subsequent events or circumstances, if any.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Consolidated Interim Statements of Financial Position

As of June 30, 2015 and December 31, 2014

(Unaudited)


In millions of won	*Note*		June 30, 2015		December 31, 2014
Assets

Current assets
Cash and cash equivalents		5,6,7,44	￦	3,850,438		1,796,300
Current financial assets, net		5,10,11,12,44		1,754,114		176,428
Trade and other receivables, net		5,8,14,20,44,46		6,691,138		7,697,862
Inventories, net		13		4,827,817		4,537,469
Income tax refund receivables		40		23,409		18,475
Current non-financial assets		15		434,090		502,511
Assets held-for-sale		41		2,090,810		2,090,810

Total current assets				19,671,816		16,819,855

Non-current assets
Non-current financial assets, net		5,6,9,10,11,12,44		2,151,485		2,040,921
Non-current trade and other receivables, net		5,8,14,44,46		1,754,614		1,724,357
Property, plant and equipment, net		18,27,48		138,903,739		135,812,499
Investment properties, net		19,27		237,581		317,264
Goodwill		16		2,582		2,582
Intangible assets other than goodwill, net		21,27		807,112		821,060
Investments in associates		4,17		4,532,250		4,341,830
Investments in joint ventures		4,17		1,263,002		1,166,894
Deferred tax assets		40		628,931		526,934
Non-current non-financial assets		15		129,787		134,093

Total non-current assets				150,411,083		146,888,434


Total assets		4	￦	170,082,899		163,708,289

(Continued)

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Consolidated Interim Statements of Financial Position, Continued

As of June 30, 2015 and December 31, 2014

(Unaudited)


In millions of won	*Note*		June 30, 2015			December 31, 2014

Liabilities

Current liabilities
Trade and other payables, net		5,22,24,44,46	￦	4,794,212			6,128,604
Current financial liabilities, net		5,11,23,44,46		7,860,325			7,162,372
Income tax payables		40		589,516			570,550
Current non-financial liabilities		20,28,29		13,720,341			6,464,356
Current provisions		26,44		1,541,659			1,274,186

Total current liabilities				28,506,053			21,600,068

Non-current liabilities
Non-current trade and other payables, net		5,22,24,44,46		3,809,699			3,806,735
Non-current financial liabilities, net		5,11,23,44,46		53,228,171			55,999,761
Non-current non-financial liabilities		28,29		6,991,431			6,946,410
Employee benefits liabilities, net		25,44		1,487,885			1,277,415
Deferred tax liabilities		40		6,516,356			5,723,880
Non-current provisions		26,44		12,490,018			13,529,010

Total non-current liabilities				84,523,560			87,283,211


Total liabilities		4	￦	113,029,613			108,883,279


Equity

Contributed capital		1,30,44
Share capital			￦	3,209,820			3,209,820
Share premium				843,758			843,758

				4,053,578			4,053,578
Retained earnings		31
Legal reserves				1,604,910			1,604,910
Voluntary reserves				23,720,167			22,999,359
Unappropriated retained earnings				12,130,509			10,699,378

				37,455,586			35,303,647


Other components of equity		33
Other capital surpluses				1,198,374			1,151,402
Accumulated other comprehensive loss				(183,400	)		(202,269	)
Other equity				13,294,973			13,294,973

				14,309,947			14,244,106


Equity attributable to owners of the Company				55,819,111			53,601,331


Non-controlling interests		16, 32		1,234,175			1,223,679


Total equity			￦	57,053,286			54,825,010


Total liabilities and equity			￦	170,082,899			163,708,289

See accompanying notes to the consolidated interim financial statements.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Consolidated Interim Statements of Comprehensive Income (Loss)

For the three and six-month periods ended June 30, 2015 and 2014

(Unaudited)


In millions of won, except per share information			June 30, 2015						June 30, 2014
	*Note*		Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended

Sales		4,34,44,46
Sales of goods			￦	12,264,491			26,497,475			11,830,026			25,903,602
Sales of services				121,583			216,371			142,886			207,464
Sales of construction services		20		1,192,576			1,897,085			829,221			1,377,969
Revenue related to transfer of assets from customers				93,176			184,754			87,166			172,911

				13,671,826			28,795,685			12,889,299			27,661,946

Cost of sales		13,25,42,46
Cost of sales of goods				(9,783,228	)		(21,449,147	)		(10,682,236	)		(23,200,495	)
Cost of sales of services				(115,545	)		(204,704	)		(55,591	)		(143,671	)
Cost of sales of construction services				(1,132,526	)		(1,799,617	)		(798,761	)		(1,302,143	)

				(11,031,299	)		(23,453,468	)		(11,536,588	)		(24,646,309	)


Gross profit				2,640,527			5,342,217			1,352,711			3,015,637


Selling and administrative expenses		25,35,42,46		(552,543	)		(1,014,367	)		(523,471	)		(959,320	)


Operating profit		4,51		2,087,984			4,327,850			829,240			2,056,317

Other non-operating income		36		96,330			213,695			74,958			145,681

Other non-operating expense		36		(16,980	)		(40,117	)		(14,298	)		(37,357	)

Other gains, net		13, 37		47,241			73,135			49,395			90,477

Finance income		5,11,38		275,466			448,373			681,344			655,948

Finance expenses		5,11,39		(783,041	)		(1,450,165	)		(1,284,271	)		(1,782,938	)

Profit related to associates, joint ventures and subsidiaries		4,17
Share in profit of associates and joint ventures				38,653			246,207			50,095			185,078
Gain on disposal of investments in subsidiaries		16		—			5,866			45,981			45,981
Share in loss of associates and joint ventures				(12,170	)		(33,041	)		(3,790	)		(27,048	)
Loss on disposal of investments in associates and joint ventures				—			—			(106	)		(106	)
Impairment loss on investments in associates and joint ventures				—			—			—			(1,558	)

				26,483			219,032			92,180			202,347


Profit before income tax				1,733,483			3,791,803			428,548			1,330,475


Income tax expense		40		(391,589	)		(1,226,802	)		(237,036	)		(577,692	)


Profit for the period			￦	1,341,894			2,565,001			191,512			752,783

(Continued)

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Consolidated Interim Statements of Comprehensive Income (Loss), Continued

For the three and six-month periods ended June 30, 2015 and 2014

(Unaudited)


In millions of won, except per share information			June 30, 2015						June 30, 2014
	*Note*		Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended

Other comprehensive income (loss)		5,11,25,31,33
Items that will not be reclassified subsequently to profit or loss:
Remeasurements of defined benefit liability, net of tax		25,31	￦	45,646			(33,185	)		(45,363	)		(60,708	)
Share in other comprehensive income (loss) of associates and joint ventures, net of tax		31		1,472			1,230			(1,811	)		(2,017	)
Items that are or may be reclassified subsequently to profit or loss:
Net change in the unrealized fair value of available-for-sale financial assets, net of tax		33		32,552			22,905			(23,948	)		(40,495	)
Net change in the unrealized fair value of derivatives using cash flow hedge accounting, net of tax		5,11,33		(33,358	)		(21,360	)		(37,238	)		(33,913	)
Foreign currency translation of foreign operations, net of tax		33		36,051			(15,962	)		(157,270	)		(98,465	)
Share in other comprehensive income (loss) of associates and joint ventures, net of tax		33		45,713			34,922			(27,895	)		(81,689	)


Other comprehensive income (loss), net of tax				128,076			(11,450	)		(293,525	)		(317,287	)

Total comprehensive income (loss) for the period			￦	1,469,970			2,553,551			(102,013	)		435,496


Profit or loss attributable to:
Owners of the Company		43	￦	1,305,183			2,505,266			154,752			687,014
Non-controlling interests				36,711			59,735			36,760			65,769

			￦	1,341,894			2,565,001			191,512			752,783

Total comprehensive income (loss) attributable to:
Owners of the Company			￦	1,423,010			2,491,790			(117,946	)		378,057
Non-controlling interests				46,960			61,761			15,933			57,439

			￦	1,469,970			2,553,551			(102,013	)		435,496


Earnings per share		43
Basic and diluted earnings per share			￦	2,034			3,903			248			1,103

See accompanying notes to the consolidated interim financial statements.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Consolidated Interim Statements of Changes in Equity

For the six-month periods ended June 30, 2015 and 2014

(Unaudited)


In millions of won	Equity attributable to owners of the Company											Non-			Total equity
	Contributed capital		Retained earnings			Other components of equity			Subtotal			controlling interests			Total equity

Balance at January 1, 2014	￦	4,053,578		32,766,086			13,440,004			50,259,668			1,191,068			51,450,736

Total comprehensive income (loss) for the period
Profit for the period		—		687,014			—			687,014			65,769			752,783
Items that will not be reclassified subsequently to profit or loss:
Remeasurements of defined benefit liability, net of tax		—		(53,574	)		—			(53,574	)		(7,134	)		(60,708	)
Share in other comprehensive loss of associates and joint ventures, net of tax		—		(2,017	)		—			(2,017	)		—			(2,017	)
Items that may be reclassified subsequently to profit or loss:
Net changes in the unrealized fair value of available-for-sale financial assets, net of tax		—		—			(40,494	)		(40,494	)		(1	)		(40,495	)
Net change in the unrealized fair value of derivatives using cash flow hedge accounting, net of tax		—		—			(30,673	)		(30,673	)		(3,240	)		(33,913	)
Foreign currency translation of foreign operations, net of tax		—		—			(99,918	)		(99,918	)		1,453			(98,465	)
Share in other comprehensive income (loss) of associates and joint ventures, net of tax		—		—			(82,281	)		(82,281	)		592			(81,689	)
Transactions with owners of the Company, recognized directly in equity
Dividends paid		—		(56,074	)		—			(56,074	)		(86,805	)		(142,879	)
Issuance of share capital by subsidiaries		—		—			—			—			4,379			4,379
Equity transaction within consolidated scope		—		—			(3,917	)		(3,917	)		(1,939	)		(5,856	)
Changes in consolidated scope – other than issuance of share capital		—		—			—			—			(5,648	)		(5,648	)
Dividends paid (hybrid securities)		—		—			—			—			(8,182	)		(8,182	)
Others		—		—			—			—			(5	)		(5	)


Balance at June 30, 2014	￦	4,053,578		33,341,435			13,182,721			50,577,734			1,150,307			51,728,041

(Continued)

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Consolidated Interim Statements of Changes in Equity, Continued

For the six-month periods ended June 30, 2015 and 2014

(Unaudited)


In millions of won	Equity attributable to owners of the Company											Non-			Total equity
	Contributed capital		Retained earnings			Other components of equity			Subtotal			controlling interests			Total equity

Balance at January 1, 2015	￦	4,053,578		35,303,647			14,244,106			53,601,331			1,223,679			54,825,010

Total comprehensive income (loss) for the period
Profit for the period		—		2,505,266			—			2,505,266			59,735			2,565,001
Items that will not be reclassified subsequently to profit or loss:
Remeasurements of defined benefit liability, net of tax		—		(33,575	)		—			(33,575	)		390			(33,185	)
Share in other comprehensive income of associates and joint ventures, net of tax		—		1,230			—			1,230			—			1,230
Items that may be reclassified subsequently to profit or loss:
Net changes in the unrealized fair value of available-for-sale financial assets, net of tax		—		—			22,905			22,905			—			22,905
Net change in the unrealized fair value of derivatives using cash flow hedge accounting, net of tax		—		—			(17,875	)		(17,875	)		(3,485	)		(21,360	)
Foreign currency translation of foreign operations, net of tax		—		—			(21,083	)		(21,083	)		5,121			(15,962	)
Share in other comprehensive income of associates and joint ventures, net of tax		—		—			34,922			34,922			—			34,922
Transactions with owners of the Company, recognized directly in equity
Dividends paid		—		(320,982	)		—			(320,982	)		(56,352	)		(377,334	)
Issuance of share capital by subsidiaries		—		—			2,865			2,865			6,382			9,247
Equity transaction within consolidated scope		—		—			44,107			44,107			9,591			53,698
Changes in consolidated scope – other than issuance of share capital		—		—			—			—			(1,547	)		(1,547	)
Dividends paid (hybrid securities)		—		—			—			—			(8,182	)		(8,182	)
Others		—		—			—			—			(1,157	)		(1,157	)


Balance at June 30, 2015	￦	4,053,578		37,455,586			14,309,947			55,819,111			1,234,175			57,053,286

See accompanying notes to the consolidated interim financial statements.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Consolidated Interim Statements of Cash Flows

For the six-month periods ended June 30, 2015 and 2014

(Unaudited)


In millions of won	June 30, 2015			June 30, 2014

Cash flows from operating activities
Profit for the period	￦	2,565,001			752,783


Adjustments for:
Income tax expense		1,226,802			577,692
Depreciation		4,003,612			3,797,274
Amortization		37,647			39,229
Employee benefit expense		153,924			173,881
Bad debt expense (reversal)		(4,488	)		30,299
Interest expense		1,078,463			1,193,767
Loss on sale of financial assets		2,983			2
Loss on disposal of property, plant and equipment		1,720			10,141
Loss on abandonment of property, plant, and equipment		123,390			127,051
Impairment loss on property, plant and equipment		4,757			8,900
Loss on disposal of intangible assets		5			17
Accretion expense to provisions, net		796,511			568,534
Loss (gain) on foreign currency translation, net		246,856			(401,492	)
Valuation and transaction loss (gain) on derivative instruments, net		(211,224	)		446,877
Share in profit of associates and joint ventures, net		(213,166	)		(158,030	)
Gain on disposal of property, plant and equipment		(96,769	)		(32,508	)
Gain on disposal of intangible assets		(32	)		—
Gain on disposal of investments in associates, joint ventures and subsidiaries		(5,866	)		(45,875	)
Impairment loss on investments in associates and joint ventures		—			1,558
Interest income		(105,008	)		(98,005	)
Dividend income		(13,564	)		(13,547	)
Impairment loss on available-for-sale securities		13,993			41,792
Others, net		(945	)		(25,522	)

		7,039,601			6,242,035

Changes in:
Trade receivables		1,088,488			710,016
Non-trade receivables		(8,699	)		3,584
Accrued income		(45,056	)		(87,989	)
Other receivables		(279	)		2,907
Other current assets		22,890			20,963
Inventories		(599,374	)		(502,572	)
Other non-current assets		(42,396	)		(34,391	)
Trade payables		(1,700,352	)		(1,118,435	)
Non-trade payables		100,075			281,887
Accrued expenses		45,201			84,938
Other liabilities		22			—
Other current liabilities		963,614			849,354
Other non-current liabilities		127,768			(142,255	)
Investments in associates and joint ventures		37,903			22,378
Provisions		(414,474	)		(327,564	)
Payments of employee benefit obligations		(14,844	)		(88,605	)
Plan assets		305			(2,311	)

		(439,208	)		(328,095	)

(Continued)

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Consolidated Interim Statements of Cash Flows, Continued

For the six-month periods ended June 30, 2015 and 2014

(Unaudited)


In millions of won	June 30, 2015			June 30, 2014

Cash generated from operating activities
Dividends received	￦	13,564			11,051
Interest paid		(1,120,011	)		(1,227,539	)
Interest received		80,705			84,933
Income taxes refund (paid)		(514,632	)		111,027

Net cash provided by operating activities		7,625,020			5,646,195


Cash flows from investing activities
Proceeds from disposals of associates and joint ventures		—			1,915
Acquisition of associates and joint ventures		(67,886	)		(210,911	)
Proceeds from disposals of property, plant and equipment		6,589,066			35,453
Acquisition of property, plant and equipment		(7,799,359	)		(7,642,027	)
Proceeds from disposals of intangible assets		163			2
Acquisition of intangible assets		(33,945	)		(30,017	)
Proceeds from disposals of financial assets		142,562			433,673
Acquisition of financial assets		(1,629,993	)		(192,456	)
Increase in loans		(109,534	)		(91,151	)
Collection of loans		47,743			56,190
Increase in deposits		(156,985	)		(120,450	)
Decrease in deposits		119,476			115,284
Receipt of government grants		10,153			31,021
Usage of government grants		(18,943	)		(1,805	)
Net cash inflow from changes in consolidation scope		553			44,523
Other cash inflow (outflow) from investing activities, net		15,016			(16,958	)

Net cash used in investing activities		(2,891,913	)		(7,587,714	)


Cash flows from financing activities
Proceeds from short-term borrowings, net		323,645			1,218,390
Proceeds from long-term borrowings and debt securities		2,124,045			5,176,073
Repayment of long-term borrowings and debt securities		(4,783,278	)		(3,876,757	)
Payment of finance lease liabilities		(55,242	)		(60,078	)
Settlement of derivative instruments, net		3,713			(316,069	)
Proceeds (payment) for changes in interests in subsidiaries		72,316			(378	)
Dividends paid (hybrid bond)		(8,182	)		(8,182	)
Dividends paid		(377,334	)		(142,879	)
Other cash inflow (outflow) from financing activities, net		(2,437	)		4,886

Net cash provided by (used in) financing activities		(2,702,754	)		1,995,006


Net increase in cash and cash equivalents before effect of exchange rate fluctuations		2,030,353			53,487

Effect of exchange rate fluctuations on cash held		23,785			4,506


Net increase in cash and cash equivalents		2,054,138			57,993

Cash and cash equivalents at January 1		1,796,300			2,232,313


Cash and cash equivalents at June 30	￦	3,850,438			2,290,306

See accompanying notes to the consolidated interim financial statements.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements

June 30, 2015

(Unaudited)

1.	Reporting Entity (Description of the controlling company)

Korea Electric Power Corporation (“KEPCO”), controlling company as defined in Korean International Financial Reporting Standards (“K-IFRS”) 1110 ‘Consolidated Financial Statements’, was incorporated on January 1, 1982 in accordance with the Korea Electric Power Corporation Act (the “KEPCO Act”) to engage in the generation, transmission and distribution of electricity and development of electric power resources in the Republic of Korea. KEPCO also provides power plant construction services. KEPCO’s stock was listed on the Korea Stock Exchange on August 10, 1989 and the Company listed its Depository Receipts (DR) on the New York Stock Exchange on October 27, 1994.

As of June 30, 2015, KEPCO’s share capital amounts to ￦3,209,820 million and KEPCO’s shareholders are as follows:


	Number of shares		Percentage of ownership
Government of the Republic of Korea		116,841,794		18.20	%
Korea Development Bank		211,235,264		32.90	%
Other (*)		313,887,019		48.90	%


		641,964,077		100.00	%

(*)	The number of shares held by foreign shareholders are 196,514,960 shares (30.61%) as of the most recent closing date of Register of Shareholders (May 6, 2015).

In accordance with the Restructuring Plan enacted on January 21, 1999 by the Ministry of Trade, Industry and Energy (the “MTIE”, formerly the Ministry of Knowledge Economy), KEPCO spun off its power generation divisions on April 2, 2001, resulting in the establishment of six power generation subsidiaries. KEPCO moved the headquarters to Naju, Jeollanam-do, in November 2014 as part of the government’s plan to relocate state-run companies for balanced national development.

2.	Basis of Preparation

These consolidated interim financial statements were prepared in accordance with K-IFRS 1034, ‘Interim Financial Reporting’ as part of the period covered by KEPCO and subsidiaries (the “Company”)’s K-IFRS annual financial statements. The notes are included to explain events and transactions to give the changes in financial position and performance of the Company since the last annual consolidated financial statements as of and for the year ended December 31, 2014.

(1)

Statement of compliance

The consolidated financial statements have been prepared in accordance with K-IFRS, as prescribed in the Act on External Audits of Corporations in the Republic of Korea.

(2)

Basis of measurement

The consolidated financial statements have been prepared on the historical cost basis, except for the following material items in the consolidated statements of financial position:

•

derivative financial instruments are measured at fair value

•

available-for-sale financial assets are measured at fair value

•

liabilities for defined benefit plans are recognized at the net of the total present value of defined benefit obligations less the fair value of plan assets

(3)

Functional and presentation currency

These consolidated financial statements are presented in Korean won (“Won”), which is KEPCO’s functional currency and the currency of the primary economic environment in which the Company operates.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

2.	Basis of Preparation, Continued

(4)

Use of estimates and judgments

The preparation of the consolidated financial statements in conformity with K-IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

(i)

Useful lives of property, plant and equipment, estimations on provision for decommissioning costs

The Company reviews the estimated useful lives of property, plant and equipment at the end of each annual reporting period. Management’s assumptions could affect the determination of estimated economic useful lives.

The Company records the fair value of estimated decommissioning costs as a liability in the period in which the Company incurs a legal obligation associated with the retirement of long-lived assets that result from acquisition, construction, development and/or normal use of the assets. The Company is required to record a liability for the dismantling (demolition) of nuclear power plants and disposal of spent fuel and low and intermediate radioactive wastes.

(ii)

Deferred tax

The Company recognizes deferred tax assets and liabilities based on the differences between the financial statement carrying amounts and the tax bases of assets and liabilities of each consolidated taxpaying entity. However, the amount of deferred tax assets may be different if the Company does not realize estimated future taxable income during the carry forward periods.

(iii)

Valuations of financial instruments at fair values

The Company’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities. The Company has an established control framework with respect to the measurement of fair values. This includes a valuation team that has overall responsibility for overseeing all significant fair value measurements, including Level 3 fair values, and reports directly to the financial officer.

The valuation team regularly reviews significant unobservable inputs and valuation adjustments. If third party information, such as broker quotes or pricing services, is used to measure fair values, then the valuation team assesses the evidence obtained from the third parties to support the conclusion that such valuations meet the requirements of K-IFRS including the level in the fair value hierarchy in which such valuation techniques should be classified.

When measuring the fair value of an asset or a liability, the Company uses market observable data as far as possible. Fair values are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows.

If the inputs used to measure the fair value of an asset or a liability might be categorized in different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. The Company recognizes transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

2.	Basis of Preparation, Continued

(4)

Use of estimates and judgments, continued

(iv)

Defined employee benefit liabilities

The Company offers its employees defined benefit plans. The cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuations being carried out at the end of each reporting period. For actuarial valuations, certain inputs such as discount rates and future salary increases are estimated. Defined benefit plans contain significant uncertainties in estimations due to its long-term nature (Note 25).

(v)

Unbilled revenue

Energy delivered but not yet metered nor billed are estimated at the reporting date based on consumption statistics and selling price estimates. Determination of the unbilled revenues at the end of the reporting period is sensitive to the estimated assumptions and prices based on statistics. Unbilled revenue recognized as of June 30, 2015 and 2014 is ￦1,302,371 million and ￦1,303,863 million, respectively.

(5)

Changes in accounting policies

(i)

Amendments to K-IFRS 1019 ‘Employee Benefits’ – Employee contributions

The Company has adopted amendments to K-IFRS 1019, ‘Employee Benefits – Employee contributions’, since July 1, 2014. Amendments to K-IFRS 1019 introduced a practical expedient to accounting for defined benefit plan, when employees or third parties pay contributions if certain criteria are met. According to the amendments, the entity is permitted to recognize those contributions as a reduction of the service cost in the period in which the related service is rendered, instead of forecast future contributions from employees or third parties and attribute them to periods or service as negative benefits.

Upon adoption of the amendment, there is no significant impact on the Company’s consolidated financial statements.

(6)

New standards and interpretations not yet adopted

The following new standards, interpretations and amendments to existing standards have been published, and effective for annual periods beginning on or after January 1, 2016, and the Company has not early adopted them. The management believes the impact on the consolidated financial statements upon the adoption of the amendments is immaterial.

(i)

Amendments to K-IFRS 1016, ‘Property, Plant and Equipment’

Amendments to K-IFRS 1016, ‘Property, Plant and Equipment’ specify that the use of revenue-based methods to calculate the depreciation of an asset is not appropriate. These amendments are effective for annual periods beginning on or after January 1, 2016.

(ii)

Amendments to K-IFRS 1038, ‘Intangible Assets’

Amendments to K-IFRS 1038, ‘Intangible Assets’ introduce a rebuttable presumption that the use of revenue-based amortization methods for intangible assets is inappropriate. This presumption can be rebutted only when revenue and the consumption of the economic benefits of the intangible asset are highly correlated, or when the intangible asset is expressed as a measure of revenue. These amendments are effective for annual periods beginning on or after January 1, 2016.

(iii)

Amendments to K-IFRS 1111, ‘Joint Arrangement’

Amendments to K-IFRS 1111, ‘Joint Arrangement’ require an investor to apply the principles of business combination accounting when it acquires an interest in a joint operation that constitutes a business as defined in K-IFRS 1103, ‘Business Combinations’. These amendments are effective for annual periods beginning on or after January 1, 2016.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies

Except as described in note 2.(5), the Company applied the following significant accounting policies consistently for all periods presented.

(1)

Basis of consolidation

The consolidated financial statements are the financial statements of a group in which the assets, liabilities, equity, income, expenses and cash flows of the parent and its subsidiaries are presented as those of a single economic entity. Subsidiaries are controlled by the Company. The Company controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.

Income and expense of a subsidiary acquired or disposed of during the year are included in the consolidated statement of comprehensive income (loss) from the effective date of acquisition and up to the effective date of disposal, as appropriate. Total comprehensive income (loss) of subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those of the Company.

Transactions between the Company and its subsidiaries are eliminated during the consolidation.

Changes in the Company’s ownership interests in a subsidiary that do not result in the Company losing control over the subsidiary are accounted for as equity transactions. The carrying amounts of the Company’s interests and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiary. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to owners of the Company.

When the Company loses control of a subsidiary, the income or loss on disposal is calculated as the difference 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 goodwill), and liabilities of the subsidiary and any non-controlling interests. When assets of the subsidiary are carried at revalued amounts or fair values and the related cumulative gain or loss has been recognized in other comprehensive income (loss) and accumulated in equity, the amounts previously recognized in other comprehensive income (loss) and accumulated in equity are accounted for as if the Company had directly disposed of the relevant assets (i.e. reclassified to income or loss or transferred directly to retained earnings). The fair value of any investment retained in the former subsidiary at the date when control is lost is recognized as the fair value on initial recognition for subsequent accounting under K-IFRS 1039, ‘Financial Instruments: Recognition and Measurement’ or, when applicable, the cost on initial recognition of an investment in an associate or a joint venture.

(2)

Business combinations

A business combination is accounted for by applying the acquisition method, unless it is a combination involving entities or businesses under common control.

The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the Company, liabilities incurred by the Company to the former owners of the acquiree and the equity interests issued by the Company in exchange for control of the acquiree. Acquisition-related costs are generally recognized in income or loss as incurred.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(2)

Business combinations, continued

At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognized at their fair value at the acquisition date, except that:

•

deferred tax assets or liabilities and liabilities or assets related to employee benefit arrangements are recognized and measured in accordance with K-IFRS 1012,‘ Income Taxes’ and K-IFRS 1019,‘ Employee Benefits’ respectively;

•

assets (or disposal groups) that are classified as held for sale in accordance with K-IFRS 1105, ‘Non-current Assets Held-for-Sale’ are measured in accordance with that standard.

Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed. If, after reassessment, net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer’s previously held interest in the acquiree (if any), the excess is recognized immediately in income or loss as a bargain purchase gain.

Non-controlling interest that is present on acquisition day and entitles the holder to a proportionate share of the entity’s net assets in an event of liquidation, may be initially measured either at fair value or at the non-controlling interest’s proportionate share of the recognized amounts of the acquiree’s identifiable net assets. The choice of measurement can be elected on a transaction-by-transaction basis. Other types of non-controlling interests are measured at fair value or, when applicable, on the basis specified in other K-IFRSs.

When the consideration transferred by the Company in a business combination includes assets or liabilities resulting from a contingent consideration arrangement, the contingent consideration is measured at its acquisition-date fair value and included as part of the consideration transferred in a business combination. Changes in the fair value of the contingent consideration that qualify as measurement period adjustments are adjusted retrospectively, with corresponding adjustments against goodwill. Measurement period adjustments are adjustments that arise from additional information obtained during the ‘measurement period’ (which cannot exceed one year from the acquisition date) about facts and circumstances that existed at the acquisition date.

The subsequent accounting for changes in the fair value of the contingent consideration that do not qualify as measurement period adjustments depends on how the contingent consideration is classified. Contingent consideration that is classified as equity is not re-measured at subsequent reporting dates and its subsequent settlement is accounted for within equity. Contingent consideration that is classified as an asset or a liability is re-measured at subsequent reporting dates in accordance with K-IFRS 1039, ‘Financial Instruments: Recognition and Measurement’, or with K-IFRS 1037, ‘Provisions’, Contingent Liabilities and Contingent Assets, as appropriate, with the corresponding gain or loss being recognized in income or loss.

When a business combination is achieved in stages, the Company’s previously held equity interest in the acquiree is re-measured to fair value at the acquisition date (i.e. the date when the Company obtains control) and the resulting gain or loss, if any, is recognized in income or loss. Amounts arising from interests in the acquiree prior to the acquisition date that have previously been recognized in other comprehensive income (loss) are reclassified to income or loss where such treatment would be appropriate if that interest were disposed of.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Company reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period (see above), or additional assets or liabilities are recognized, to reflect new information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognized at that date.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(2)

Business combinations, continued

The assets and liabilities acquired under business combinations under common control are recognized at the carrying amounts recognized previously in the consolidated financial statements of the ultimate parent. The difference between consideration transferred and carrying amounts of net assets acquired is recognized as part of share premium.

(3)

Investments in associates

An associate is an entity over which the Company has significant influence and that is neither a subsidiary nor an interest in a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the investee but does not control or joint control over those policies.

The results and assets and liabilities of associates are incorporated in these consolidated financial statements using the equity method of accounting. If the investment is classified as held for sale, in which case it is accounted for in accordance with K-IFRS 1105, ‘Non-current Assets Held-for-Sale’, any retained portion of an investment in associates that has not been classified as held for sale shall be accounted for using the equity method until disposal of the portion that is classified as held for sale takes place. If the Company holds 20% ~ 50% of the voting power of the investee, it is presumed that the Company has significant influence.

After the disposal takes place, the Company shall account for any retained interest in associates in accordance with K-IFRS 1039, ‘Financial Instruments: Recognition and Measurement’ unless the retained interest continues to be an associates, in which case the entity uses the equity method.

Under the equity method, an investment in an associate is initially recognized in the consolidated statement of financial position at cost and adjusted thereafter to recognize the Company’s share of the income or loss and other comprehensive income (loss) of the associate. When the Company’s share of losses of an associate exceeds the Company’s interest in that associate (which includes any long-term interests that, in substance, form part of the Company’s net investment in the associate), the Company discontinues recognizing its share of further losses. Additional losses are recognized only to the extent that the Company has incurred legal or constructive obligations or made payments on behalf of the associate.

Any excess of the cost of acquisition over the Company’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities of an associate recognized at the date of acquisition is recognized as goodwill, which is included within the carrying amount of the investment. Any excess of the Company’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition, after reassessment, is recognized immediately in income or loss. The requirements of K-IFRS 1039, ‘Financial Instruments: Recognition and Measurement’, are applied to determine whether it is necessary to recognize any impairment loss with respect to the Company’s investment in an associate. When necessary, the entire carrying amount of the investment (including goodwill) is tested for impairment in accordance with K-IFRS 1036, ‘Impairment of Assets’ as a single asset by comparing its recoverable amount (higher of value in use and fair value less costs to sell) with its carrying amount, any impairment loss recognized forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognized in accordance with K-IFRS 1036 to the extent that the recoverable amount of the investment subsequently increases.

Upon disposal of an associate that results in the Company losing significant influence over that associate, any retained investment is measured at fair value at that date and the fair value is regarded as its fair value on initial recognition as a financial asset in accordance with K-IFRS 1036. The difference between the previous carrying amount of the associate attributable to the retained interest and its fair value is included in the determination of the gain or loss on disposal of the associate. In addition, the Company accounts for all amounts previously recognized in other comprehensive income (loss) in relation to that associate on the same basis as would be required if that associate had directly disposed of the related assets or liabilities. Therefore, if a gain or loss previously recognized in other comprehensive income (loss) by that associate would be reclassified to income or loss on the disposal of the related assets or liabilities, the Company reclassifies the gain or loss from equity to income or loss (as a reclassification adjustment) when it loses significant influence over that associate.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(3)

Investments in associates, continued

When the Company transacts with its associate, incomes and losses resulting from the transactions with the associate are recognized in the Company’s consolidated financial statements only to the extent of interests in the associate that are not related to the Company.

(4)

Joint arrangements

A joint arrangement is an arrangement of which two or more parties have joint control. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control. Joint arrangements are classified into two types – joint operations and joint ventures. A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement (i.e. joint operators) have rights to the assets, and obligations for the liabilities, relating to the arrangement. A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement (i.e. joint ventures) have rights to the net assets of the arrangement.

If the Company is a joint operator, the Company is to recognize and measure the assets and liabilities (and recognize the related revenues and expenses) in relation to its interest in the arrangement in accordance with relevant K-IFRSs applicable to the particular assets, liabilities, revenues and expenses. If the joint arrangement is a joint venture, the Company is to account for that investment using the equity method accounting in accordance with K-IFRS 1028, ‘Investment in Associates and Joint Ventures’ (see note 3 (3)), except when the Company is applying K-IFRS 1105, ‘Non-current Assets Held for Sale’.

(5)

Non-current assets held-for-sale

Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the non-current asset (or disposal group) is available for immediate sale in its present condition. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date of classification.

When the Company is committed to a sale plan involving loss of control of a subsidiary, all of the assets and liabilities of that subsidiary are classified as held for sale when the criteria described above are met, regardless of whether the Company will retain a non-controlling interest in its former subsidiary after the sale.

Non-current assets (and disposal groups) classified as held for sale are measured at the lower of their previous carrying amount and fair value less costs to sell.

(6)

Goodwill

The Company measures goodwill which is acquired in a business combination at the amount recognized at the date on which it obtains control of the acquiree (acquisition date) less any accumulated impairment losses. Goodwill acquired in a business combination is allocated to each CGU that is expected to benefit from the synergies arising from the business acquired.

The Company assesses at the end of each reporting period whether there is any indication that an asset may be impaired. An impairment loss is recognized if the carrying amount of an asset or a CGU exceeds its recoverable amount. Impairment losses are recognized in profit or loss.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(6)

Goodwill, continued

Any impairment identified at the CGU level will first reduce the carrying value of goodwill and then be used to reduce the carrying amount of the other assets in the CGU on a pro rata basis. Except for impairment losses in respect of goodwill which are never reversed, an impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

(7)

Revenue recognition

Revenue from the sale of goods, rendering of services or use of the Company assets is measured at the fair value of the consideration received or receivable, net of returns, trade discounts and volume rebates, which are recognized as a reduction of revenue. Revenue is recognized when the amount of revenue can be measured reliably and it is probable that the economic benefits associated with the transaction will flow to the Company.

(i)

Sales of goods

The Korean Government approves the rates charged to customers by the Company’s power transmission and distribution division. The Company’s utility rates are designed to recover the Company’s reasonable costs plus a fair investment return. The Company’s power generation rates are determined in the market.

The Company recognizes electricity sales revenue based on power sold (transferred to the customer) up to the reporting date. To determine the amount of power sold, the Company estimates daily power volumes of electricity for residential, commercial, general and etc. The differences between the current month’s estimated amount and actual (meter-read) amount, is adjusted for (trued-up) during the subsequent month.

(ii)

Sales of other services

Revenue from services rendered is recognized in profit or loss in proportion to the stage of completion of the transaction at the reporting date. The stage of completion is assessed by reference to surveys of work performed or services performed to date as a percentage of total services to be performed or the proportion that costs incurred to date bear to the estimated total costs of the transaction or other methods that reliably measures the services performed.

(iii)

Dividend income and interest income

Dividend income is recognized in profit or loss on the date that the Company’s right to receive payment is established, which in the case of quoted securities is the ex-dividend date.

Interest income is recognized as it accrues in profit or loss, using the effective interest method. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying amount on initial recognition.

(iv)

Rental income

The Company’s policy for recognition of revenue from operating leases is described in note 3 (9) below.

(v)

Deferral of revenue – Transfer of Assets from Customers

The Company recovers a substantial amount of the cost related to its electric power distribution facilities from customers through the transfer of assets, while the remaining portion is recovered through electricity sales from such customers in the future. As such, the Company believes there exists a continued service obligation to the customers in accordance with K-IFRS 2118, ‘Transfer of Assets from Customers’ when the Company receives an item of property, equipment, or cash for constructing or acquiring an item of property or equipment, in exchange for supplying electricity to customers. The Company defers the amounts received, which are subsequently recognized as revenue over the estimated service period which does not exceed the transferred asset’s useful life.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(8)

Construction services revenue

The Company provides services related to the construction of power plants related to facilities of its customers, mostly in foreign countries.

When the outcome of a construction contract can be estimated reliably, revenue and costs are recognized based on the stage of completion of the contract activity at the end of the reporting period, measured based on the proportion of contract costs incurred for work performed to date relative to the estimated total contract costs, except where this would not be representative of the stage of completion. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.

When the outcome of a construction contract cannot be estimated reliably, contract revenue is recognized to the extent of contract costs incurred when it is probable the revenue will be realized. Contract costs are recognized as expenses in the period in which they are incurred. When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognized as an expense immediately.

When contract costs incurred to date plus recognized income less recognized losses exceed progress billings, the surplus is shown as amounts due from customers for contract work. For contracts where progress billings exceed contract costs incurred to date plus recognized income less recognized losses, the surplus is shown as the amounts due to customers for contract work. Amounts received before the related work is performed are included in the consolidated statements of financial position, as a liability, as advances received. Amounts billed for work performed but not yet paid by the customer are included in the consolidated statements of financial position as accounts and other receivables.

(9)

Leases

The Company classifies and accounts for leases as either a finance or operating lease, depending on the terms. Leases where the Company assumes substantially all of the risks and rewards of ownership are classified as finance leases. All other leases are classified as operating leases.

(i)

The Company as lessor

Amounts due from lessees under finance leases are recognized as receivables at the amount of the Company’s net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the Company’s net investment outstanding in respect of the leases.

Rental income from operating leases is recognized on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognized on a straight-line basis over the lease term.

(ii)

The Company as lessee

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.

Assets held under finance leases are initially recognized as assets of the Company at their fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the statement of financial position as a finance lease obligation.

Lease payments are apportioned between finance expenses and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance expenses are recognized immediately in income or loss, unless they are directly attributable to qualifying assets, in which case they are capitalized in accordance with the Company’s general policy on borrowing costs. Contingent rentals are recognized as expenses in the periods in which they are incurred.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(9)

Leases, continued

Operating lease payments are recognized as an expense on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. Contingent rentals arising under operating leases are recognized as an expense in the period in which they are incurred.

In the event that lease incentives are received to enter into operating leases, such incentives are recognized as a liability. The aggregate benefit of incentives is recognized as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

(10)

Foreign currencies

Transactions in foreign currencies are translated to the respective functional currencies of the Company entities at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are retranslated to the functional currency using the reporting date’s exchange rate. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the functional currency at the exchange rate at the date that the fair value was determined.

Exchange differences are recognized in profit or loss in the period in which they arise except for:

•

Exchange differences on foreign currency borrowings relating to assets under construction for future productive use, which are included in the cost of those assets when they are regarded as an adjustment to interest costs on those foreign currency borrowings;

•

Exchange differences on transactions entered into in order to hedge certain foreign currency risks; and

•

Exchange differences on monetary items receivable from or payable to a foreign operation for which settlement is neither planned nor likely to occur (therefore forming part of the net investment in the foreign operation), which are recognized initially in other comprehensive income (loss) and reclassified from equity to income or loss on disposal or partial disposal of the net investment.

For the purpose of presenting financial statements, the assets and liabilities of the Company’s foreign operations are expressed in Korean won using exchange rates prevailing at the end of the reporting period. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuated significantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognized in other comprehensive income (loss) and accumulated in equity.

When a foreign operation is disposed of, the relevant amount in the translation is transferred to profit or loss as part of the profit or loss on disposal.

(11)

Borrowing costs

The Company capitalizes borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset. Other borrowing costs are recognized in expense as incurred. A qualifying asset is an asset that requires a substantial period of time to get ready for its intended use or sale.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.

All other borrowing costs are recognized in income or loss in the period in which they are incurred.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(12)

Government grants

Government grants are not recognized unless there is reasonable assurance that the Company will comply with the grant’s conditions and that the grant will be received.

Benefit from a government loan at a below-market interest rate is treated as a government grant, measured as the difference between proceeds received and the fair value of the loan based on prevailing market interest rates.

(i)

If the Company received grants related to assets

Government grants whose primary condition is that the Company purchase, construct or otherwise acquire long-term assets are deducted in calculating the carrying amount of the asset. The grant is recognized in profit or loss over the life of a depreciable asset as a reduced depreciation expense.

(ii)

If the Company received grants related to income

Government grants which are intended to compensate the Company for expenses incurred are recognized as other income (government grants) in profit or loss over the periods in which the Company recognizes the related costs as expenses.

(13)

Employee benefits

When an employee has rendered service to the Company during a period, the Company recognizes the contribution payable to a defined contribution plan in exchange for that service as a liability (accrued expense).

For defined benefit pension plans and other post-employment benefits, the net periodic pension expense is actuarially determined by “Pension Actuarial System” developed by independent actuaries using the projected unit credit method. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid and that have terms to maturity approximating the terms of the related pension liability. However, if there is not a deep market, market yields on government bonds are used.

Net defined benefit liability’s measurement is composed of actuarial gains and losses, return on plan assets excluding net interest on net defined benefit liability, and any change in the effect of the asset ceiling, excluding net interest, which will immediately recognized in other comprehensive income (loss). The actuarial gains or losses recognized in other comprehensive income (loss) which will not be reclassified into net profit or loss for later periods are immediately recognized in retained earnings. Past service cost will be recognized as expenses upon the earlier of the date of change or reduction to the plan, or the date of recognizing termination benefits.

The retirement benefit obligation recognized in the statement of financial position represents the present value of the defined benefit obligation as adjusted for unrecognized actuarial gains and losses and unrecognized past service cost, and as reduced by the fair value of plan assets. Any asset resulting from this calculation is limited to unrecognized actuarial losses and past service cost, plus the present value of available refunds and reductions in future contributions to the plan.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(14)

Income taxes

Income tax expense comprises current and deferred tax. Current tax and deferred tax are recognized in profit or loss except to the extent that it relates to a business combination, or items recognized directly in equity or in other comprehensive income (loss).

(i)

Current tax

Current tax is the expected tax payable or receivable on the taxable profit or loss for the year, using tax rates enacted or substantively enacted at the end of the reporting period and any adjustment to tax payable in respect of previous years. The taxable profit is different from the accounting profit for the period since the taxable profit is calculated excluding the temporary differences, which will be taxable or deductible in determining taxable profit (tax loss) of future periods, and non-taxable or non-deductible items from the accounting profit.

(ii)

Deferred tax

Deferred tax is recognized, using the asset-liability method, in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. A deferred tax liability is recognized for all taxable temporary differences. A deferred tax asset is recognized for all deductible temporary differences to the extent that it is probable that taxable profit will be available against which they can be utilized. However, deferred tax is not recognized for the following temporary differences: taxable temporary differences arising on the initial recognition of goodwill, or the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting profit or loss nor taxable income.

The measurement of deferred tax liabilities and deferred tax assets reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. Deferred tax assets or deferred tax liabilities on investment properties measured at fair value, unless any contrary evidence exists, are measured using the assumption that the carrying amount of the property will be recovered entirely through sale.

The Company recognizes a deferred tax liability for all taxable temporary differences associated with investments in subsidiaries, associates, and interests in joint ventures, except to the extent that the Company is able to control the timing of the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. The Company recognizes a deferred tax asset for all deductible temporary differences arising from investments in subsidiaries and associates, to the extent that it is probable that the temporary difference will reverse in the foreseeable future and taxable profit will be available against which the temporary difference can be utilized.

The carrying amount of a deferred tax asset is reviewed at the end of each reporting period and reduces the carrying amount to the extent that it is no longer probable that sufficient taxable profit will be available to allow the benefit of part or all of that deferred tax asset to be utilized.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax liabilities and deferred tax assets reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset only if there is a legally enforceable right to offset the related current tax liabilities and assets, and they relate to income taxes levied by the same tax authority and they intend to settle current tax liabilities and assets on a net basis.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(14)

Income taxes, continued

(iii)

Current and deferred tax for the year

Current and deferred tax are recognized in income or loss, except when they relate to items that are recognized in other comprehensive income (loss) or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income (loss) or directly in equity respectively. Where current tax or deferred tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business combination.

(15)

Property, plant and equipment

Property, plant and equipment are initially measured at cost and after initial recognition, are carried at cost less accumulated depreciation and accumulated impairment losses. The cost of property, plant and equipment includes expenditures arising directly from the construction or acquisition of the asset, any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management and the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located.

Subsequent costs are recognized in the carrying amount of property, plant and equipment at cost or, if appropriate, as separate items if it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognized. The costs of the day-to-day servicing are recognized in profit or loss as incurred.

Property, plant and equipment, except for land, are depreciated on a straight-line basis over estimated useful lives that appropriately reflect the pattern in which the asset’s future economic benefits are expected to be consumed. For loaded nuclear fuel related to long-term raw materials and spent nuclear fuels related to asset retirement costs, the Company uses the production method to measure and recognizes as expense the economic benefits of the assets.

The estimated useful lives of the Company’s property, plant and equipment are as follows:


		Useful lives (years)

Buildings		8 ~ 40
Structures		8 ~ 50
Machinery		6 ~ 32
Vehicles		4
Loaded heavy water		30
Asset retirement costs		18, 30, 40
Finance lease assets		20
Ships		9
Others		4 ~ 9

A component that is significant compared to the total cost of property, plant and equipment is depreciated over its separate useful life. Depreciation methods, useful lives and residual values are reviewed at the end of each reporting date and adjusted, if appropriate.

Property, plant and equipment are derecognized on disposal, or when no future economic benefits are expected from its use or disposal. Gains or losses arising from derecognition of a property, plant and equipment, measured as the difference between the net disposal proceeds and the carrying amount of the asset, are recognized in income or loss when the asset is derecognized.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(16)

Investment property

Property held for the purpose of earning rentals or benefiting from capital appreciation is classified as investment property. Investment property is initially measured at its cost. Transaction costs are included in the initial measurement. Subsequently, investment property is carried at depreciated cost less any accumulated impairment losses.

Subsequent costs are recognized in the carrying amount of investment property at cost or, if appropriate, as separate items if it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognized. The costs of the day-to-day servicing are recognized in profit or loss as incurred.

Investment property except for land, are depreciated on a straight-line basis over 8 ~ 40 years as estimated useful lives. The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis.

An investment property is derecognized upon disposal or when the investment property is permanently withdrawn from use and no future economic benefits are expected from the disposal. Any gain or loss arising on derecognition of the property (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in income or loss in the period in which the property is derecognized.

(17)

Intangible assets

(i)

Intangible assets acquired separately

Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated amortization and accumulated impairment losses. Amortization is recognized on a straight-line basis over their estimated useful lives. The estimated useful life and amortization method are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. Intangible assets with indefinite useful lives that are acquired separately are carried at cost less accumulated impairment losses.

(ii)

Research and development

Expenditure on research activities is recognized as an expense in the period in which it is incurred.

An internally-generated intangible asset arising from development (or from the development phase of an internal project) is recognized if, and only if, all of the following have been demonstrated:

•

The technical feasibility of completing the intangible asset so that it will be available for use or sale;

•

The intention to complete the intangible asset and use or sell it;

•

The ability to use or sell the intangible asset;

•

How the intangible asset will generate probable future economic benefits;

•

The availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and

•

The ability to measure reliably the expenditure attributable to the intangible asset during its development.

The amount initially recognized for internally-generated intangible assets is the sum of the expenditure incurred from the date when the intangible asset first meets the recognition criteria listed above. When the development expenditure does not meet the criteria listed above, an internally-generated intangible asset cannot be recognized and the expenditure is recognized in income or loss in the period in which it is incurred.

Internally-generated intangible assets are reported at cost less accumulated amortization and accumulated impairment losses.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(17)

Intangible assets, continued

The estimated useful lives and amortization methods of the Company’s intangible assets with finite useful lives are as follows:


	Useful lives (years)	Amortization methods

Usage rights for donated assets	4 ~ 30	Straight
Software	4, 5	Straight
Industrial rights	5, 10	Straight
Development expenses	5	Straight
Dam usage right	50	Straight
Mining right	—	Unit of production
Others	4 ~ 20, 50	Straight

(iii)

Intangible assets acquired in a business combination

Intangible assets that are acquired in a business combination are recognized separately from goodwill are initially recognized at their fair value at the acquisition date (which is regarded as their cost).

Subsequent to initial recognition, intangible assets acquired in a business combination are reported at cost less accumulated amortization and accumulated impairment losses, on the same basis as intangible assets that are acquired separately.

(iv)

Derecognition of intangible assets

An intangible asset is derecognized on disposal, or when no future economic benefits are expected from its use or disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset, and are recognized in income or loss when the asset is derecognized.

(18)

Impairment of non-financial assets other than goodwill

At the end of each reporting period, the Company reviews the carrying amounts of its tangible and intangible assets with definite useful lives to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. Where a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis can be identified.

Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment at least annually, and whenever there is an indication that the asset may be impaired.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or a cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or the cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognized immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(18)

Impairment of non-financial assets other than goodwill, continued

When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is increased to the revised estimate of its recoverable amount, to the extent the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognized immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

(19)

Inventories

Inventories are measured at the lower of cost and net realizable value. Cost of inventories, except for those in transit, are measured under the weighted average method and consists of the purchase price, cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses. The amount of any write-down of inventories to net realizable value and all losses of inventories are recognized as an expense in the period the write-down or loss occurs. The amount of any reversal of any write-down of inventories, arising from an increase in net realizable value, are recognized as a reduction in the amount of inventories recognized as an expense in the period in which the reversal occurs.

(20)

Provisions

Provisions are recognized when the Company has a present legal or constructive obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

The risks and uncertainties that inevitably surround many events and circumstances are taken into account in reaching the best estimate of a provision. Where the effect of the time value of money is material, provisions are determined at the present value of the expected future cash flows.

Where some or all of the expenditures required to settle a provision are expected to be reimbursed by another party, the reimbursement shall be recognized when, and only when, it is virtually certain that reimbursement will be received if the entity settles the obligation. The reimbursement shall be treated as a separate asset.

Provisions are reviewed at the end of each reporting period and adjusted to reflect the current best estimates. If it is no longer probable that an outflow of resources embodying economic benefits will be required to settle the obligation, the provision is reversed.

(i)

Provision for employment benefits

The Company determines the provision for employment benefits as the incentive payments based on the results of the individual performance evaluation or management assessment.

(ii)

Provision for decommissioning costs of nuclear power plants

The Company records the fair value of estimated decommissioning costs as a liability in the period in which the Company incurs a legal obligation associated with retirement of long-lived assets that result from acquisition, construction, development and/or normal use of the assets. Accretion expense consists of period-to-period changes in the liability for decommissioning costs resulting from the passage of time and revisions to either the timing or the amount of the original estimate of undiscounted cash flows.

(iii)

Provision for disposal of spent nuclear fuel

Under the Radioactive Waste Management Act, the Company is levied to pay the spent nuclear fuel fund for the management of spent nuclear fuel. The Company recognizes the provision of present value of the payments.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(20)

Provisions, continued

(iv)

Provision for low and intermediate radioactive wastes

Under the Radioactive Waste Management Act, the Company recognizes the provision for the disposal of low and intermediate radioactive wastes in best estimate of the expenditure required to settle the present obligation.

(v)

Provision for Polychlorinated Biphenyls (“PCBs”)

Under the regulation of Persistent Organic Pollutants Management Act, enacted in 2007, the Company is required to remove polychlorinated biphenyls (PCBs), a toxin, from the insulating oil of its transformers by 2025. As a result of the enactments, the Company is required to inspect the PCBs contents of transformers and dispose of PCBs in excess of safety standards under the legally settled procedures. The Company’s estimates and assumptions used to determine fair value can be affected by many factors, such as the estimated costs of inspection and disposal, inflation rate, discount rate, regulations and the general economy.

(vi)

Provisions for power plant regional support program

Power plant regional support programs consist of scholarship programs to local students, local economy support programs, local culture support programs, environment development programs, and local welfare programs. The Company recognizes the provision in relation to power plant regional support program.

(vii)

Provisions for transmission and transformation facilities-neighboring areas support program

The Company has present obligation to conduct transmission and transformation facilities-neighboring areas support program under Act on assistance to transmission and transformation facilities-neighboring areas. The Company recognizes the provision of estimated amount to fulfill the obligation.

(viii)

Renewable portfolio standard (“RPS”) provisions

Renewable portfolio standard (“RPS”) program is required to generate a specified percentage of total electricity to be generated in the form of renewable energy and provisions are recognized for the governmental regulations to require the production of energies from renewable energy sources such as solar, wind and biomass.

(21)

Non-derivative financial assets

The Company recognizes and measures non-derivative financial assets by the following four categories: financial assets at fair value through profit or loss, held-to-maturity investments, loans and receivables and available-for-sale financial assets. The Company recognizes financial assets in the statement of financial position when the Company becomes a party to the contractual provisions of the instrument. Upon initial recognition, non-derivative financial assets are measured at their fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the asset’s acquisition or issuance.

A regular way purchase or sale of financial assets shall be recognized and derecognized, as applicable, using trade date accounting or settlement date accounting. A regular way purchase or sale is a purchase or sale of a financial asset under a contract whose terms require delivery of the asset within the time frame established generally by regulation or convention in the marketplace concerned.

(i)

Effective interest method

The effective interest method is a method of calculating the amortized cost of a debt instrument and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the debt instrument, or, where appropriate, a shorter period, to the net carrying amount on initial recognition. Income is recognized on an effective interest basis for debt instruments other than those financial assets classified as financial assets at fair value through profit or loss.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(21)

Non-derivative financial assets, continued

(ii)

Financial assets at fair value through profit or loss (FVTPL)

A financial asset is classified as financial assets are classified at fair value through profit or loss if it is held for trading or is designated as such upon initial recognition. Upon initial recognition, transaction costs are recognized in profit or loss when incurred. A financial assets its acquired principally for the purpose of selling it in the near term are classified as a short-term financial assets held for trading and also all the derivatives including an embedded derivate that is not designated and effective as a hedging instrument are classified at the short-term trading financial asset as well. Financial assets at fair value through profit or loss are measured at fair value, and changes therein are recognized in profit or loss.

A financial asset is classified as held for trading if:

•

It has been acquired principally for the purpose of selling it in the near term; or

•

On initial recognition it is part of a portfolio of identified financial instruments that the Company manages together and has a recent actual pattern of short term profit taking; or

•

It is derivative, including an embedded derivative that is not designated and effective as a hedging instrument.

A financial asset other than a financial asset held for trading may be designated as at financial assets at fair value through profit or loss upon initial recognition if:

•

Such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise; or

•

The financial asset forms part of a group of financial assets or financial liabilities or both, which is managed and its’ performance is evaluated on a fair value basis in accordance with the Company’s documented risk management or investment strategy, and information about the grouping is provided internally on that basis; or

•

It forms a part of a contract containing one or more embedded derivatives, and with K-IFRS 1039, ‘Financial Instruments; Recognition and Measurement’ permits the entire combined contract (asset or liability) to be designated as at financial assets at fair value through profit or loss.

Financial assets at fair value through profit or loss are stated at fair value, with any gains or losses arising on re-measurement recognized in income or loss. The net gain or loss recognized in income or loss incorporates any dividend or interest earned on the financial asset and is included in the ‘finance income and finance expenses’ line item in the consolidated statement of comprehensive income.

(iii)

Held-to-maturity investments

A non-derivative financial asset with a fixed or determinable payment and fixed maturity, for which the Company has the positive intention and ability to hold to maturity, are classified as held-to-maturity investments. Subsequent to initial recognition, held-to-maturity investments are measured at amortized cost using the effective interest method.

(iv)

Available-for-sale financial assets

Available-for-sale financial assets are those non-derivative financial assets that are designated as available-for-sale or are not classified as financial assets at fair value through profit or loss, held-to-maturity investments or loans and receivables.

Gains and losses arising from changes in fair value are recognized in other comprehensive income and accumulated in the valuation reserve. However, impairment losses, interest calculated using the effective interest method, and foreign exchange gains and losses on monetary assets are recognized in income or loss. Unquoted equity investments which are not traded in an active market, whose fair value cannot be measured reliably are carried at cost.

When a financial asset is derecognized or impairment losses are recognized, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss.

Dividends on an available-for-sale equity instrument are recognized in profit or loss when the Company’s right to receive payment is established.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(21)

Non-derivative financial assets, continued

The fair value of available-for-sale monetary assets denominated in a foreign currency is determined in that foreign currency and translated at the spot rate at the end of the reporting period. The foreign exchange gains and losses that are recognized in income or loss are determined based on the amortized cost of the monetary asset. Other foreign exchange gains and losses are recognized in other comprehensive income.

(v)

Loans and receivables

Loans and receivables are financial assets with fixed or determinable payments that are not quoted in an active market. Subsequent to initial recognition, loans and receivables are measured at amortized cost using the effective interest method except for loans and receivables of which the effect of discounting is immaterial.

(vi)

Impairment of financial assets

Financial assets, other than those at financial assets at fair value through profit or loss, are assessed for indicators of impairment at the end of each reporting period. Financial assets are considered to be impaired when there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been affected.

For listed and unlisted equity investments classified as available-for-sale financial asset, a significant or prolonged decline in the fair value of the security below its cost is considered to be objective evidence of impairment in addition to the criteria mentioned below.

For all other financial assets, objective evidence of impairment could include:

•

Significant financial difficulty of the issuer or counterparty; or

•

Breach of contract, such as a default or delinquency in interest or principal payments, or

•

It becoming probable that the borrower will enter bankruptcy or financial re-organization; or

•

The disappearance of an active market for that financial asset because of financial difficulties.

For certain categories of financial asset, such as trade receivables, assets that are assessed not to be impaired individually are, in addition, assessed for impairment on a collective basis. Objective evidence of impairment for a portfolio of receivables could include the Company’s past experience of collecting payments, an increase in the number of delayed payments in the portfolio past the average credit period and, as well as observable changes in national or local economic conditions that correlate with default on receivables.

For financial assets recorded at amortized cost, the amount of the impairment loss recognized is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.

For financial assets carried at cost, the amount of the impairment loss is measured as the difference between the asset’s carrying amount and the present value of the estimated future cash flows discounted at the current market rate of return for a similar financial asset. Such impairment loss will not be reversed in subsequent periods.

The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables, where the carrying amount is reduced through the use of an allowance account. When a trade receivable is considered uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognized in income or loss.

When an available-for-sale financial asset is considered to be impaired, cumulative gains or losses previously recognized in other comprehensive income are reclassified to income or loss in the period.

For financial assets measured at amortized cost, if, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognized, the previously recognized impairment loss is reversed through income or loss to the extent that the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortized cost would have been had the impairment not been recognized.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(21)

Non-derivative financial assets, continued

In respect of available-for-sale equity securities, impairment losses previously recognized in profit or loss are not reversed through profit or loss. Any increase in fair value subsequent to an impairment loss is recognized in other comprehensive income. In respect of available-for-sale debt securities, impairment losses are subsequently reversed through income or loss if an increase in the fair value of the investment can be objectively related to an event occurring after the recognition of the impairment loss.

(vii)

De-recognition of financial assets

The Company derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows on the financial asset in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred. Any interest in transferred financial assets that is created or retained by the Company is recognized as a separate asset or liability. If the Company retains substantially all the risks and rewards of ownership of the transferred financial assets, the Company continues to recognize the transferred financial assets and recognizes financial liabilities for the consideration received.

On de-recognition of a financial asset in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognized in other comprehensive income and accumulated in equity is recognized in income or loss.

On de-recognition of a financial asset other than in its entirety (e.g. when the Company retains an option to repurchase part of a transferred asset), the Company allocates the previous carrying amount of the financial asset between the part it continues to recognize under continuing involvement, and the part it no longer recognizes on the basis of the relative fair values of those parts on the date of the transfer. The difference between the carrying amount allocated to the part that is no longer recognized and the sum of the consideration received for the part no longer recognized and any cumulative gain or loss allocated to it that had been recognized in other comprehensive income is recognized in income or loss. A cumulative gain or loss that had been recognized in other comprehensive income is allocated between the part that continues to be recognized and the part that is no longer recognized on the basis of the relative fair values of those parts.

(22)

Non-derivative financial liabilities and equity instruments issued by the Company

(i)

Classification as debt or equity

Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangement.

(ii)

Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Company are recognized at the proceeds received, net of direct issue costs.

Repurchase of the Company’s own equity instruments is recognized and deducted directly in equity. No gain or loss is recognized in income or loss on the purchase, sale, issue or cancellation of the Company’s own equity instruments.

(iii)

Financial liabilities

Financial liabilities are recognized when the Company becomes a party to the contractual provisions of the instruments. Financial liabilities are initially measured at fair value. Transaction cost that are directly attributable to the issue of financial liabilities are added to or deducted from the fair value of the financial liabilities, as appropriate, on initial recognition. Transaction cost directly attributable to acquisition of financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

Financial liabilities are classified as either financial liabilities at fair value through profit or loss or other financial liabilities.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(22)

Non-derivative financial liabilities and equity instruments issued by the Company, continued

(iv)

Financial liabilities at fair value through profit or loss (FVTPL)

Financial liabilities are classified as at financial liabilities at fair value through profit or loss when the financial liability is either held for trading or it is designated as financial liabilities at fair value through profit or loss.

A financial liability is classified as held for trading if:

•

It has been acquired principally for the purpose of repurchasing it in the near term; or

•

On initial recognition it is part of a portfolio of identified financial instruments that the Company manages together and has a recent actual pattern of short-term profit-taking; or

•

It is a derivative that is not designated and effective as a hedging instrument.

A financial liability other than a financial liability held for trading may be designated as at FVTPL upon initial recognition if:

•

Such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise; or

•

The financial liability forms part of a Company of financial assets or financial liabilities or both, which is managed and its performance is evaluated on a fair value basis, in accordance with the Company’s documented risk management or investment strategy, and information about the grouping is provided internally on that basis; or

•

It forms part of a contract containing one or more embedded derivatives, and K-IFRS 1039, ‘Financial Instruments: Recognition and Measurement’, permits the entire combined contract (asset or liability) to be designated as at FVTPL.

Financial liabilities at fair value through profit or loss are stated at fair value, with any gains or losses arising on re-measurement recognized in income or loss. The net gain or loss recognized in income or loss incorporates any interest paid on the financial liability and is included in ‘finance income and finance expenses’.

(v)

Other financial liabilities

Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs.

Other financial liabilities are subsequently measured at amortized cost using the effective interest method, with interest expense recognized on an effective yield basis. The effective interest method is a method of calculating the amortized cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial recognition.

(vi)

Financial guarantee contract liabilities

Financial guarantee contract liabilities are initially measured at their fair values and, if not designated as at FVTPL, are subsequently measured at the higher of: (a) the amount of the obligation under the contract, as determined in accordance with K-IFRS 1037, ‘Provisions’, Contingent Liabilities and Contingent Assets; or (b) the amount initially recognized less, cumulative amortization recognized in accordance with K-IFRS 1018, ‘Revenue’.

(vii)

De-recognition of financial liabilities

The Company derecognizes financial liabilities when, and only when, the Company’s obligations are discharged, cancelled or they expire. The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable is recognized in income or loss.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(23)

Derivative financial instruments, including hedge accounting

The Company enters into a variety of derivative financial instruments to manage its exposure to interest rate and foreign exchange rate risk, including foreign exchange forward contracts, interest rate swaps and cross currency swaps and others.

Derivatives are initially recognized at fair value. Subsequent to initial recognition, derivatives are measured at fair value.

The resulting gain or loss is recognized in income or loss immediately unless the derivative is designated and effective as a hedging instrument, in such case the timing of the recognition in income or loss depends on the nature of the hedge relationship.

A derivative with a positive fair value is recognized as a financial asset; a derivative with a negative fair value is recognized as a financial liability. A derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the instrument is more than 12 months and it is not expected to be realized or settled within 12 months. Other derivatives are presented as current assets or current liabilities.

(i)

Separable embedded derivatives

Derivatives embedded in other financial instruments or other host contracts are treated as separate derivatives when their risks and characteristics are not closely related to those of the host contracts and when the host contracts are not measured at FVTPL.

An embedded derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the hybrid instrument to which the embedded derivative is part of, is more than 12 months and it is not expected to be realized or settled within 12 months. All other embedded derivatives are presented as current assets or current liabilities.

(ii)

Hedge accounting

The Company designates certain hedging instruments, which include derivatives, embedded derivatives and non-derivatives in respect of foreign currency risk, as either fair value hedges or cash flow hedges. Hedges of foreign exchange risk on firm commitments are accounted for as cash flow hedges.

At the inception of the hedge relationship, the entity documents the relationship between the hedging instrument and the hedged item, along with its risk management objectives and its strategy for undertaking various hedge transactions. Furthermore, at the inception of the hedge and on an ongoing basis, the Company documents whether the hedging instrument is highly effective in offsetting changes in fair values or cash flows of the hedged item.

(iii)

Fair value hedges

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognized in income or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk. The changes in the fair value of the hedging instrument and the change in the hedged item attributable to the hedged risk relating to the hedged items are recognized in the consolidated statements of comprehensive income.

Hedge accounting is discontinued when the Company revokes the hedging relationship, when the hedging instrument expires or is sold, terminated, or exercised, or when it no longer qualifies for hedge accounting. The fair value adjustment to the carrying amount of the hedged item arising from the hedged risk is amortized as income or loss as of that date.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

3.	Significant Accounting Policies, Continued

(23)

Derivative financial instruments, including hedge accounting, continued

(iv)

Cash flow hedges

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognized in other comprehensive income. The gain or loss relating to the ineffective portion is recognized immediately in income or loss, and is included in the ‘finance income and expense’.

Amounts previously recognized in other comprehensive income and accumulated in equity are reclassified to income or loss in the periods when the hedged item is recognized in income or loss, in the same line of the consolidated statement of comprehensive income as the recognized hedged item. However, when the forecast transaction that is hedged results in the recognition of a non-financial asset or a non-financial liability, the gains and losses previously accumulated in equity are transferred from equity and included in the initial measurement of the cost of the non-financial asset or non-financial liability.

Hedge accounting is discontinued when the Company revokes the hedging relationship, when the hedging instrument expires or is sold, terminated, or exercised, or it no longer qualifies for hedge accounting. Any gain or loss accumulated in equity at that time remains in equity and is recognized when the forecast transaction is ultimately recognized in income or loss. When a forecast transaction is no longer expected to occur, the gain or loss accumulated in equity is recognized immediately in income or loss.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

4.	Segment, Geographic and Other Information

(1)

Segment determination and explanation of the measurements

The Company’s operating segments are its business components that generates discrete financial information that is reported to and regularly revised by the Company’s the chief operating decision maker, the Chief Executive Officer, for the purpose of resource allocation and assessment of segment performance. The Company’s reportable segment are ‘Transmission and distribution’, ‘Electric power generation (Nuclear)’, ‘Electric power generation (Non-nuclear)’, ‘Plant maintenance & engineering service’ and ‘Others’; others mainly represent the business unit that manages the Company’s foreign operations.

Segment operating profit (loss) is determined the same way that consolidated operating profit is determined under K-IFRS without any adjustment for corporate allocations. The accounting policies used by each segment are consistent with the accounting policies used in the preparation of the consolidated financial statements. Segment assets and liabilities are determined based on separate financial statements of the entities instead of on a consolidated basis. There are various transactions between the reportable segments, including sales of property, plant and equipment and so on, that are conducted on an arms-length basis at market prices that would be applicable to an independent third-party. For subsidiaries which are in a different segment from that of its immediate parent company, their carrying amount in separate financial statements is eliminated in the consolidating adjustments in the tables below. In addition, consolidation adjustments in the table below include adjustments of the amount of investment in associates and joint ventures from the cost basis amount reflected in segment assets to that determined using an equity method basis in the consolidated financial statements.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

4.	Segment, Geographic and Other Information, Continued

(2)

Financial information of the segments for the three and six-month periods ended June 30, 2015 and 2014, respectively, are as follows:


In millions of won
June 30, 2015
Segment	Total segment revenue						Intersegment revenue						Revenue from external customers				Income (loss) of associates and joint ventures						Depreciation and Amortization						Interest Income						Interest expense						Operating income (loss)
	Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended			Three- month period ended		Six- month period ended		Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended

Transmission and distribution	￦	13,561,560			28,498,239			313,577			610,732			13,247,983		27,887,507		44,215			214,247			706,033			1,410,193			21,292			31,862			281,603			583,719			2,124,786			1,930,620
Electric power generation (Nuclear)		1,902,260			4,638,420			1,896,788			4,630,737			5,472		7,683		(55	)		(713	)		725,525			1,462,841			6,086			13,094			149,585			299,171			(3,327	)		1,192,216
Electric power generation (Non-nuclear)		4,085,679			10,709,496			3,928,265			10,341,346			157,414		368,150		(16,831	)		5,544			572,605			1,134,531			5,397			11,066			78,141			160,470			(183,626	)		1,033,762
Plant maintenance & engineering service		616,499			1,170,215			479,572			893,785			136,927		276,430		(846	)		(46	)		20,133			40,031			2,398			5,422			32			71			74,239			130,854
Others		162,603			314,232			38,573			58,317			124,030		255,915		—			—			6,493			13,536			27,616			53,138			24,557			45,066			18,398			32,899
Consolidation adjustments		(6,656,775	)		(16,534,917	)		(6,656,775	)		(16,534,917	)		—		—		—			—			(10,469	)		(19,873	)		(7,274	)		(9,574	)		(8,111	)		(10,034	)		57,514			7,499


	￦	13,671,826			28,795,685			—			—			13,671,826		28,795,685		26,483			219,032			2,020,320			4,041,259			55,515			105,008			525,807			1,078,463			2,087,984			4,327,850

Other non-operating income																																										96,330			213,695
Other non-operating expense																																										(16,980	)		(40,117	)
Other gains, net																																										47,241			73,135
Finance income																																										275,466			448,373
Finance expenses																																										(783,041	)		(1,450,165	)

Profit related associates, joint ventures and subsidiaries																																										26,483			219,032

Profit before income tax																																										1,733,483			3,791,803

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

4.	Segment, Geographic and Other Information, Continued

(2)

Financial information of the segments for the three and six-month periods ended June 30, 2015 and 2014, respectively, are as follows, continued:


In millions of won
June 30, 2014
Segment	Total segment revenue						Intersegment revenue						Revenue from external customers				Income (loss) of associates and joint ventures						Depreciation and amortization						Interest Income						Interest expense						Operating profit (loss)
	Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended			Three- month period ended		Six- month period ended		Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended

Transmission and distribution	￦	12,910,804			27,591,865			367,866			653,818			12,542,938		26,938,047		47,295			154,351			672,748			1,344,667			6,128			13,093			367,594			727,483			(186,677	)		(453,644	)
Electric power generation (Nuclear)		2,348,101			4,796,222			2,346,772			4,792,235			1,329		3,987		—			740			726,898			1,430,109			8,005			11,957			145,511			291,308			644,341			1,593,310
Electric power generation (Non-nuclear)		5,625,770			13,054,438			5,559,204			12,860,962			66,566		193,476		46,107			49,679			513,202			1,030,271			8,395			16,545			65,968			140,881			307,609			821,981
Plant maintenance & engineering service		647,547			1,202,026			467,514			870,558			180,033		331,468		(1,222	)		(2,423	)		17,141			34,907			3,697			8,699			(35	)		108			90,757			148,415
Others		127,435			249,635			29,002			54,667			98,433		194,968		—			—			6,856			13,513			28,258			55,154			21,852			40,420			31,116			62,223
Consolidation adjustments		(8,770,358	)		(19,232,240	)		(8,770,358	)		(19,232,240	)		—		—		—			—			(8,466	)		(16,964	)		(4,673	)		(7,443	)		(4,169	)		(6,433	)		(57,906	)		(115,968	)


	￦	12,889,299			27,661,946			—			—			12,889,299		27,661,946		92,180			202,347			1,928,379			3,836,503			49,810			98,005			596,721			1,193,767			829,240			2,056,317

Other non-operating income																																										74,958			145,681
Other non-operating expense																																										(14,298	)		(37,357	)
Other gains, net																																										49,395			90,477
Finance income																																										681,344			655,948
Finance expenses																																										(1,284,271	)		(1,782,938	)

Profit related associates, joint ventures and subsidiaries																																										92,180			202,347

Profit before income tax																																										428,548			1,330,475

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

4.	Segment, Geographic and Other Information, Continued

(3)

Information related to segment assets and segment liabilities as of and for the six-month period ended June 30, 2015 and as of and for the year ended December 31, 2014 are as follows:


In millions of won
June 30, 2015
Segment	Segment assets			Investments in associates and joint ventures		Acquisition of non-current assets			Segment liabilities

Transmission and distribution	￦	104,026,965			4,400,585		3,718,556			59,015,749
Electric power generation (Nuclear)		49,128,233			15,780		1,359,329			27,289,507
Electric power generation (Non-nuclear)		42,485,625			1,321,098		2,811,554			24,760,768
Plant maintenance & engineering service		2,794,058			57,789		117,004			1,122,188
Others		5,647,717			—		53,909			2,171,544
Consolidation adjustments		(33,999,699	)		—		(227,048	)		(1,330,143	)


Consolidated totals	￦	170,082,899			5,795,252		7,833,304			113,029,613


In millions of won
December 31, 2014
Segment	Segment assets			Investments in associates and joint ventures		Acquisition of non-current assets			Segment liabilities

Transmission and distribution	￦	99,719,106			4,173,139		4,979,968			56,338,038
Electric power generation (Nuclear)		49,237,136			1,929		2,211,783			27,588,281
Electric power generation (Non-nuclear)		41,413,556			1,274,761		7,071,376			24,185,126
Plant maintenance & engineering service		2,659,506			58,895		377,055			990,496
Others		5,681,070			—		120,667			2,098,115
Consolidation adjustments		(35,002,085	)		—		(144,726	)		(2,316,777	)


Consolidated totals	￦	163,708,289			5,508,724		14,616,123			108,883,279

(4)

Geographic information

The following information on revenue from external customers and non-current assets is determined by the location of the customers and the assets:


In millions of won
Geographical unit	Revenue from external customers								*Non-current assets (2)**
	June 30, 2015				June 30, 2014				June 30, 2015		December 31, 2014
	Three- month period ended		Six- month period ended		Three- month period ended		Six- month period ended		June 30, 2015		December 31, 2014

Domestic	￦	12,378,120		26,685,740		11,970,221		26,134,851		141,544,538		136,053,940
Overseas (*1)		1,293,706		2,109,945		919,078		1,527,095		4,331,515		6,542,282


	￦	13,671,826		28,795,685		12,889,299		27,661,946		145,876,053		142,596,222

(*1)	Middle East and other Asian countries make up the majority of overseas revenue and non-current assets.

(*2)	Amount excludes financial assets and deferred tax assets.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

4.	Segment, Geographic and Other Information, Continued

(5)

Information on significant customers

There is no individual customer comprising more than 10% of the Company’s revenue for the six-month periods ended June 30, 2015 and 2014.

5.	Classification of Financial Instruments

(1)

Classification of financial assets as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Financial assets at fair value through profit or loss		Loans and receivables		Available- for-sale financial assets		Held-to- maturity investments		Derivative assets (using hedge accounting)		Total
Current assets
Cash and cash equivalents	￦	—		3,850,438		—		—		—		3,850,438
Current financial assets

Held-to-maturity investments		—		—		—		151		—		151
Derivative assets		21,305		—		—		—		45,655		66,960
Other financial assets		—		1,687,003		—		—		—		1,687,003

Trade and other receivables		—		6,691,138		—		—		—		6,691,138

		21,305		12,228,579		—		151		45,655		12,295,690

Non-current assets

Non-current financial assets

Available-for-sale financial assets		—		—		720,196		—		—		720,196

Held-to-maturity investments		—		—		—		3,236		—		3,236
Derivative assets		62,536		—		—		—		172,827		235,363
Other financial assets		—		1,192,690		—		—		—		1,192,690

Trade and other receivables		—		1,754,614		—		—		—		1,754,614

		62,536		2,947,304		720,196		3,236		172,827		3,906,099


	￦	83,841		15,175,883		720,196		3,387		218,482		16,201,789


In millions of won	December 31, 2014
	Financial assets at fair value through profit or loss		Loans and receivables		Available- for-sale financial assets		Held-to- maturity investments		Derivative assets (using hedge accounting)		Total
Current assets
Cash and cash equivalents	￦	—		1,796,300		—		—		—		1,796,300
Current financial assets

Held-to-maturity investments		—		—		—		265		—		265
Derivative assets		6,812		—		—		—		1,409		8,221
Other financial assets		—		167,942		—		—		—		167,942

Trade and other receivables		—		7,697,862		—		—		—		7,697,862

		6,812		9,662,104		—		265		1,409		9,670,590

Non-current assets

Non-current financial assets

Available-for-sale financial assets		—		—		715,151		—		—		715,151

Held-to-maturity investments		—		—		—		3,349		—		3,349
Derivative assets		59,037		—		—		—		102,867		161,904
Other financial assets		—		1,160,517		—		—		—		1,160,517

Trade and other receivables		—		1,724,357		—		—		—		1,724,357

		59,037		2,884,874		715,151		3,349		102,867		3,765,278


	￦	65,849		12,546,978		715,151		3,614		104,276		13,435,868

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

5.	Classification of Financial Instruments, continued

(2)

Classification of financial liabilities as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Financial liabilities at fair value through profit or loss		Financial liabilities recognized at amortized cost		Derivative liabilities (using hedge accounting)		Total
Current liabilities
Borrowings	￦	—		1,441,276		—		1,441,276
Debt securities		—		6,379,875		—		6,379,875
Derivative liabilities		37,661		—		1,513		39,174
Trade and other payables		—		4,794,212		—		4,794,212

		37,661		12,615,363		1,513		12,654,537

Non-current liabilities
Borrowings		—		1,819,091		—		1,819,091
Debt securities		—		51,151,651		—		51,151,651
Derivative liabilities		93,341		—		164,088		257,429
Trade and other payables		—		3,809,699		—		3,809,699

		93,341		56,780,441		164,088		57,037,870


	￦	131,002		69,395,804		165,601		69,692,407


In millions of won	December 31, 2014
	Financial liabilities at fair value through profit or loss		Financial liabilities recognized at amortized cost		Derivative liabilities (using hedge accounting)		Total
Current liabilities
Borrowings	￦	—		1,113,354		—		1,113,354
Debt securities		—		5,991,398		—		5,991,398
Derivative liabilities		56,296		—		1,324		57,620
Trade and other payables		—		6,128,604		—		6,128,604

		56,296		13,233,356		1,324		13,290,976

Non-current liabilities
Borrowings		—		3,475,206		—		3,475,206
Debt securities		—		52,244,369		—		52,244,369
Derivative liabilities		108,635		—		171,551		280,186
Trade and other payables		—		3,806,735		—		3,806,735

		108,635		59,526,310		171,551		59,806,496


	￦	164,931		72,759,666		172,875		73,097,472

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

5.	Classification of Financial Instruments, Continued

(2)

Classification of comprehensive income (loss) from financial instruments for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won		June 30, 2015						June 30, 2014
		Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended

Cash and cash equivalents	Interest income	￦	13,297			25,188			14,600			26,835
Available-for-sale financial assets	Dividends income		8,107			13,564			1,022			13,547
	Impairment loss on available-for-sale financial assets		(8,172	)		(13,993	)		(41,792	)		(41,792	)
	Loss on disposal of available-for-sale financial assets		(2,008	)		(2,983	)		—			(2	)
	Interest income		—			29			110			218
Held-to-maturity investments	Interest income		24			48			21			38
Loans and receivables	Interest income		4,400			11,174			8,981			16,929
Trade and other receivables	Interest income		29,484			54,465			24,875			50,646
Short-term financial instruments	Interest income		5,668			8,532			1,142			3,148
Long-term financial instruments	Interest income		2,643			5,572			81			191
Financial assets at fair value through profit or loss	Gain (loss) on valuation of derivatives		30,540			60,905			(14,141	)		(4,762	)
Financial assets at fair value through profit or loss	Gain on transaction of derivatives		472			2,138			42,762			33,199
Derivative assets (using hedge accounting)	Gain (loss) on valuation of derivatives (profit or loss)		69,806			84,005			(107,359	)		(71,451	)
	Loss on valuation of derivatives (equity, before tax) (*)		(32,598	)		(19,588	)		(16,813	)		(22,545	)
	Gain (loss) on transaction of derivatives		354			1,419			—			(1,584	)
Financial liabilities carried at amortized cost	Interest expense of borrowings and debt securities		(350,453	)		(729,657	)		(426,175	)		(853,722	)
	Interest expense of trade and other payables		(24,211	)		(45,120	)		(24,764	)		(47,140	)
	Interest expense of others		(151,143	)		(303,686	)		(145,782	)		(292,905	)
	Gain (loss) on foreign currency transactions and translations		(198,642	)		(258,978	)		590,587			445,196
Financial liabilities at fair value through profit or loss	Gain (loss) on valuation of derivatives		12,199			30,541			(267,921	)		(199,082	)
Financial liabilities at fair value through profit or loss	Loss on transaction of derivatives		(2,424	)		(4,209	)		(103,335	)		(74,740	)
Derivative liabilities (using hedge accounting)	Gain (loss) on valuation of derivatives (profit or loss)		39,586			41,443			(151,029	)		(121,509	)
	Loss on valuation of derivatives (equity, before tax) (*)		(25,460	)		(11,723	)		(37,717	)		(31,027	)
	Loss on transaction of derivatives		(1,618	)		(5,018	)		(1,636	)		(6,948	)

(*)	Items are included in other comprehensive income (loss). All other income and gain amounts listed above are included in finance income, and all expense and loss amounts listed above are included in finance expenses in the accompanying consolidated statements of comprehensive income (loss).

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

6.	Restricted Deposits

Restricted deposits as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won		June 30, 2015		December 31, 2014

Cash and cash equivalents	Escrow accounts	￦	6,336		100
	Deposits for government project		7,519		10,156
	Collateral provided for borrowings		9,181		12,926
	Collateral provided for lawsuit		367		367
Short-term financial instruments	Restriction on withdrawal related to ‘win-win growth program’ for small and medium enterprises		5,000		5,000
Long-term financial instruments	Guarantee deposits for checking account		2		3
	Guarantee deposits for banking accounts at oversea branches		319		312
	Pledge		740		740
	Decommissioning costs of nuclear power plants		603,306		603,306
	Collateral provided for borrowings		6		—


		￦	632,776		632,910

7.	Cash and Cash Equivalents

Cash and cash equivalents as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015		December 31, 2014

Cash	￦	132		77
Other demand deposit		1,635,814		1,154,250
Short-term deposits classified as cash equivalents		2,003,061		340,119
Short-term investments classified as cash equivalents		211,431		301,854


	￦	3,850,438		1,796,300

8.	Trade and Other Receivables

(1)

Trade and other receivables as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Gross amount		Allowance for doubtful accounts			Present value discount			Book value
Current assets
Trade receivables	￦	6,331,935		(54,205	)		(46	)		6,277,684
Other receivables		467,779		(51,660	)		(2,665	)		413,454

		6,799,714		(105,865	)		(2,711	)		6,691,138

Non-current assets
Trade receivables		403,297		—			(1	)		403,296
Other receivables		1,389,394		(31,979	)		(6,097	)		1,351,318

		1,792,691		(31,979	)		(6,098	)		1,754,614


	￦	8,592,405		(137,844	)		(8,809	)		8,445,752

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

8.	Trade and Other Receivables, Continued

(1)

Trade and other receivables as of June 30, 2015 and December 31, 2014 are as follows, continued:


In millions of won	December 31, 2014
	Gross amount		Allowance for doubtful accounts			Present value discount			Book value
Current assets
Trade receivables	￦	7,243,064		(80,644	)		(94	)		7,162,326
Other receivables		583,991		(46,245	)		(2,210	)		535,536

		7,827,055		(126,889	)		(2,304	)		7,697,862

Non-current assets
Trade receivables		412,222		—			(14	)		412,208
Other receivables		1,341,398		(21,687	)		(7,562	)		1,312,149

		1,753,620		(21,687	)		(7,576	)		1,724,357


	￦	9,580,675		(148,576	)		(9,880	)		9,422,219

(2)

Other receivables as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Gross amount		Allowance for doubtful accounts			Present value discount			Book value
Current assets
Non-trade receivables	￦	156,094		(51,660	)		—			104,434
Accrued income		57,149		—			—			57,149
Deposits		190,334		—			(2,665	)		187,669
Finance lease receivables		9,712		—			—			9,712
Others		54,490		—			—			54,490

		467,779		(51,660	)		(2,665	)		413,454

Non-current assets
Non-trade receivables		140,491		(27,141	)		—			113,350
Accrued income		432		—			—			432
Deposits		267,986		—			(6,097	)		261,889
Finance lease receivables		895,708		—			—			895,708
Others		84,777		(4,838	)		—			79,939

		1,389,394		(31,979	)		(6,097	)		1,351,318


	￦	1,857,173		(83,639	)		(8,762	)		1,764,772

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

8.	Trade and Other receivables, Continued

(2)

Other receivables as of June 30, 2015 and December 31, 2014 are as follows, continued:


In millions of won	December 31, 2014
	Gross amount		Allowance for doubtful accounts			Present value discount			Book value
Current assets
Non-trade receivables	￦	257,260		(46,245	)		—			211,015
Accrued income		54,242		—			—			54,242
Deposits		196,537		—			(2,210	)		194,327
Finance lease receivables		8,275		—			—			8,275
Others		67,677		—			—			67,677

		583,991		(46,245	)		(2,210	)		535,536

Non-current assets
Non-trade receivables		117,604		(18,630	)		—			98,974
Accrued income		303		—			—			303
Deposits		267,397		—			(7,562	)		259,835
Finance lease receivables		877,479		—			—			877,479
Others		78,615		(3,057	)		—			75,558

		1,341,398		(21,687	)		(7,562	)		1,312,149


	￦	1,925,389		(67,932	)		(9,772	)		1,847,685

Trade and other receivables are classified as loans and receivables, and are measured using the effective interest method. No interest is accrued for trade receivables related to electricity for the duration between the billing date and the payment due dates. But once trade receivables are overdue, the Company imposes a monthly interest rate of 2.0% on the overdue trade receivables. The Company holds deposits of three-months’ expected electricity usage for customers requesting temporary usage and customers with past defaulted payments.

(3)

Aging analysis of trade receivables as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014
Trade receivables: (not overdue, not impaired)	￦	6,615,744			7,516,233

Trade receivables: (overdue, not impaired)		4,981			1,061

Less than 60 days		4,981			1,061

Trade receivables: (other)		114,507			137,992

60 ~ 90 days		31,706			31,438
90 ~ 120 days		16,735			12,045
120 days ~ 1 year		37,295			42,736
Over 1 year		28,771			51,773

		6,735,232			7,655,286


Less allowance for doubtful accounts		(54,205	)		(80,644	)
Less present value discount		(47	)		(108	)


	￦	6,680,980			7,574,534

The Company assesses at the end of each reporting period whether there is any objective evidence that trade receivables are impaired, and provides allowances for doubtful accounts which includes impairment for trade receivables that are individually significant.

The Company considers receivables as impaired if the receivables are outstanding 60 days after the maturity and sets allowance based on past experience of collection.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

8.	Trade and Other receivables, Continued

(4)

Aging analysis of other receivables as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014
Other receivables: (not overdue, not impaired)	￦	1,643,443			1,729,807

Other receivables: (overdue, not impaired)		47,192			58,778

Less than 60 days		47,192			58,778

Other receivables: (other)		166,538			136,804

60 ~ 90 days		5,491			1,132
90 ~ 120 days		6,633			2,242
120 days ~ 1 year		57,127			18,857
Over 1 year		97,287			114,573

		1,857,173			1,925,389


Less allowance for doubtful accounts		(83,639	)		(67,932	)
Less present value discount		(8,762	)		(9,772	)


	￦	1,764,772			1,847,685

(5)

Changes in the allowance for doubtful accounts for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015						December 31, 2014
	Trade receivables			Other receivables			Trade receivables			Other receivables

Beginning balance	￦	80,644			67,932			65,024			69,887
Bad debt expense		—			12,983			39,018			15,981
Write-off		(8,968	)		(591	)		(23,398	)		(7,534	)
Reversal		(17,471	)		—			—			(241	)
Others		—			3,315			—			(10,161	)


Ending balance	￦	54,205			83,639			80,644			67,932

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

9.	Available-for-sale Financial Assets

Available-for-sale financial assets as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	Ownership			June 30, 2015		December 31, 2014
Equity securities
Listed
Kwanglim Co., Ltd. (*3)		0.44	%	￦	172		128
Cockatoo Coal Limited (*1)		0.07	%		43		628
Denison Mines Corp.		11.24	%		47,534		62,339
Energy Fuels Inc.		5.09	%		8,671		11,569
Fission 3.0		0.45	%		76		61
Fission Uranium Corp.		0.21	%		718		651
PT Adaro Energy Tbk (*1,3)		1.50	%		30,716		44,109
Sungjee Construction Co., Ltd.		0.01	%		6		5
Ssangyong Motor Co., Ltd.		0.03	%		336		357
Korea District Heating Corp. (*3)		19.55	%		176,144		127,240
Korea Line Corp.		0.00	%		—		—
Namkwang Engineering & Construction Co., Ltd.		0.01	%		1		2
Pumyang Construction Co., Ltd.		0.00	%		—		—
ELCOMTEC Co., Ltd.		0.04	%		55		48
PAN Ocean Co., Ltd.		0.00	%		6		5
Borneo International Furniture Co., Ltd.		0.28	%		77		4
TONGYANG Inc.		0.03	%		125		66
Nexolon Co., Ltd.		2.59	%		3,504
TONGYANG Networks Inc.		0.01	%		8		3

					268,192		247,215

Unlisted
LIG E&C Co., Ltd.		0.00	%		5		5
Dae Kwang Semiconductor Co., Ltd.		0.07	%		6		6
Dongnam Co., Ltd.		0.46	%		72		72
Mobo Co., Ltd.		0.00	%		14		14
SAMBO AUTO. Co., Ltd. (Formerly, Hydrogen Power Co., Ltd.)		0.02	%		38		38
Woobang ENC Co., Ltd.		0.00	%		22		22
Ginseng K Co., Ltd.		0.00	%		—		—
Areva Nc Expansion		13.49	%		214,916		227,876
IBK-AUCTUS Green Growth Private Equity Firm (*3)		6.30	%		2,325		2,325
K&C- Gyeongnam Youth Job Creation Investment Fund		10.00	%		1,340		1,340
Navanakorn Electric Co., Ltd. (*5)		29.00	%		17,217		16,836
PT. Kedap Saayq		10.00	%		12,989		12,989
Set Holding (*6)		2.50	%		167,832		167,832
Construction Guarantee (*7)		0.02	%		800		795
Global Dynasty Overseas Resource Development Private Equity Firm		7.46	%		2,233		2,233
Plant & Mechanical Contractors Financial Cooperative of Korea		0.01	%		36		36
Fire Guarantee		0.02	%		20		20
Korea Software Financial Cooperative		0.15	%		301		301
Engineering Financial Cooperative		0.10	%		60		60
Electric Contractors Financial Cooperative		0.03	%		152		152
Korea Specialty Contractor Financial Cooperative		0.01	%		417		417
Information & Communication Financial Cooperative		0.01	%		10		10
Troika Overseas Resource Development Private Equity Firm		3.66	%		13,340		13,340
Korea Electric Engineers Association		0.26	%		40		40
Korea Investment - Korea EXIM Bank CERs Private Special Asset Investment Trust 1 (*2)		14.18	%		1,752		4,752
Hanwha-KOSEP New Renewable Energy Private Special Assets Investment Trust 1		5.00	%		1,299		498
Hanwha Electric Power Venture fund (*2)		—			—		1,804
Hwan Young Steel Co., Ltd.		0.14	%		97		97
Intellectual Discovery, Ltd.		8.81	%		5,000		5,000

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

9.	Available-for-sale Financial Assets, Continued

Available-for-sale financial assets as of June 30, 2015 and December 31, 2014 are as follows, continued:


In millions of won	Ownership			June 30, 2015		December 31, 2014

Poonglim Industrial Co., Ltd.		0.01	%	￦	93		78
HANKOOK Silicon Co., Ltd.		10.44	%		7,513		7,513
Pumyang Asset Management Co., Ltd.		0.00	%		3		3
Sanbon Department Store		0.01	%		124		124
Woori Ascon Co., Ltd.		0.34	%		10		10
Miju Steel Mfg. Co., Ltd.		0.23	%		51		51
BnB Sungwon Co., Ltd.		0.01	%		15		15
Hana Civil Engineering Co., Ltd.		0.00	%		1		1
KC Development Co., Ltd.		0.02	%		6		6
IMHWA Corp.		0.11	%		5		5
IXELON Co., Ltd. (*1)		0.02	%		—		23
DAIM Special Vehicle Co., Ltd.		0.08	%		10		10
ASA KIMJE Co., Ltd.		1.11	%		465		465
ASA JEONJU Co., Ltd.		1.34	%		697		697
KYUNGWON Co., Ltd.		0.17	%		14		14
Moonkyung Silica Co., Ltd.		0.56	%		—		—
Yousung Remicon Co., Ltd.		0.26	%		4		4
Sungkwang Timber Co., Ltd.		0.34	%		4		4
Yongbo Co., Ltd.		0.20	%		3		3
HJ Steel Co., Ltd.		0.07	%		2		—
Ildong Air Conditioning Co., Ltd.		0.16	%		2		—
KS Remicon Co., Ltd.		0.04	%		3		—
Sewoong Heavy Industries Co., Ltd.		0.10	%		40		—
SIN-E Steel Co., Ltd.		0.04	%		16		—
Joongang Platec Co., Ltd.		0.75	%		72		—
Hangjin Steel Co., Ltd.		0.01	%		116		—
Pyungsan SI Ltd.		0.01	%		4		—
Samgong Development Co., Ltd.		0.01	%		7		—
Joongang Development Co., Ltd.		0.12	%		8		—
AJS Co., Ltd.		0.23	%		32		—
SET&C Co., Ltd.		0.13	%		10		—
MSE Co., Ltd.		0.13	%		9		—
Ilrim Nano Tec Co., Ltd.		0.07	%		15		—
Kwang Myeong Electronics Technology Co., Ltd.		0.37	%		11		—
Youngjin Hi-Tech Co., Ltd.		0.25	%		126		—
Dong Woo International Co., Ltd.		0.37	%		18		—
Bench Mark Construction Co., Ltd.		0.00	%		—		—
Buyoung Co., Ltd.		0.00	%		3		—
Ilsuk Co., Ltd.		0.17	%		10		—
Dongyang Telecom Co., Ltd.		0.01	%		11		—
Han Young Construction Co., Ltd.		0.03	%		3		—
Jongwon Remicon Co., Ltd.		0.18	%		13		—
Ace Heat Treating Co., Ltd.		1.43	%		72		—
Zyle Daewoo Motor Sales Co., Ltd.		0.00	%		—		—
Daewoo Development Co., Ltd.		0.00	%		—		—
Daewoo Songdo Development Co., Ltd.		0.00	%		2		—
Seyang Inc.		0.05	%		27		—
Seungri Enterprise Co., Ltd.		0.05	%		3		—
Onggane Food Co., Ltd		0.07	%		1		—
Shin-E P&C Co., Ltd.		0.00	%		1		—
Montista Telecom Co., Ltd. (*1)		0.00	%		—		—

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

9.	Available-for-sale Financial Assets, Continued

Available-for-sale financial assets as of June 30, 2015 and December 31, 2014 are as follows, continued:


In millions of won	Ownership			June 30, 2015		December 31, 2014

Ejung Ad Co., Ltd.		0.09	%	￦	3		—
Solvus Co., Ltd.		0.04	%		3		—
Myung Co., Ltd.		0.05	%		2		—
Emotion Co., Ltd.		0.61	%		8		—
Green & Sustainable Energy Investment Corp. (*4)		0.00	%		—		—
Kanan Hydroelectric Power Corp. (*4)		19.58	%		—		—
3i Powergen Inc. (*4)		15.00	%		—		—

					452,004		467,936


				￦	720,196		715,151

(*1)

It has been determined that available-for-sale financial assets were impaired because the fair values of the securities of PT Adaro Energy Tbk, Cockatoo Coal Limited, IXELON Co., Ltd. and Montista Telecom Co., Ltd. declined significantly below their respective acquisition costs during the six-month period ended June 30, 2015. As such, the Company recognized ￦13,993 million of impairment loss on available-for-sale financial assets.

(*2)

Hanwha Electric Power Venture fund and Korea Investment – Korea EXIM Bank CERs Private Special Asset Investment Trust 1 were each liquidated and partially liquidated and the Company recognized loss on disposal of available-for-sale financial assets of ￦2,983 million for the six-month period ended June 30, 2015.

(*3)

The fair values of the securities of PT. Adaro Energy Tbk, Korea District Heating Corp., IBK-AUCTUS green growth private equity firm, and others declined significantly below their respective acquisition costs during 2014. As such, the Company recognized ￦10,602 million of impairment loss on available-for-sale financial assets and cumulative losses of ￦67,503 million previously recognized in other comprehensive loss were reclassified to impairment loss on available-for-sale financial assets for the year ended December 31, 2014.

(*4)	Green & Sustainable Energy Investment Corp., Kanan Hydroelectric Power Corp., 3i Power Inc. ceased its operations and the Company recognized impairment loss of available-for-sale financial assets of ￦1,513 million for the year ended December 31, 2014.

(*5)	Although the Company holds more than 20% of the equity shares of these investments, the Company cannot exercise significant influence.

(*6)

The Company has estimated the fair value of SET Holding by using the discounted cash flow method and, has recognized the difference between its fair value and book value as gain or loss on valuation of available-for-sale financial assets in other comprehensive income or loss during the six-month period ended June 30, 2015.

(*7)

The Company has estimated the fair value of the investment in Construction Guarantee based upon the price which would be applied when the investment is returned. The Company has recognized the difference between its fair value and book value as a gain or loss on valuation of available-for-sale financial assets in other comprehensive income or loss during the six-month period ended June 30, 2015.

Book values of unlisted equity securities held by the Company that were measured at cost as of June 30, 2015 and December 31, 2014 are ￦283,372 million and ￦299,308 million, respectively, as a quoted market price does not exist in an active market and its fair value cannot be measured reliably.

10.

Held-to-maturity Investments

Held-to-maturity investments as of June 30, 2015 and December 31, 2014 are as follows:

In millions of won

June 30, 2015

December 31, 2014

Current

Non-current

Current

Non-current

Government and municipal bonds and others

￦

151

3,236

265

3,349

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

11.

Derivatives

(1)

Derivatives as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015				December 31, 2014
	Current		Non-current		Current		Non-current
Derivative assets
Currency forward	￦	3,112		9,041		182		7,233
Currency swap		63,848		223,121		8,039		151,934
Interest rate swap		—		3,201		—		2,737

	￦	66,960		235,363		8,221		161,904

Derivative liabilities
Currency forward	￦	187		—		466		—
Currency swap		32,647		153,859		53,697		196,273
Interest rate swap		6,340		103,570		3,457		83,913

	￦	39,174		257,429		57,620		280,186

(2)

Currency forward contracts which are not designated as hedge instruments as of June 30, 2015 are as follows:


In millions of won and thousands of foreign currencies
Counterparty	Contract Date		Maturity date	Contract amounts				Contract exchange rate
Counterparty	Contract Date		Maturity date	Pay		Receive		Contract exchange rate

Korea Exchange Bank		2014.04.10	2021.07.12	￦	55,120	USD	52,000	1,060.00
Korea Exchange Bank		2014.04.28	2021.07.12		50,784	USD	48,000	1,058.00
Bank of America		2014.04.29	2021.07.12		105,400	USD	100,000	1,054.00
Korea Exchange Bank		2014.05.09	2021.07.12		104,600	USD	100,000	1,046.00
Nova Scotia		2015.06.09	2015.07.08		5,604	USD	5,000	1,120.79
HSBC		2015.06.19	2015.07.17		5,515	USD	5,000	1,103.04
HSBC		2015.06.02	2015.07.01		5,577	USD	5,000	1,115.38
Credit Suisse		2015.06.04	2015.07.06		5,563	USD	5,000	1,112.68
Citibank		2015.06.22	2015.07.15		5,500	USD	5,000	1,099.93
Citibank		2015.06.04	2015.07.03		5,569	USD	5,000	1,113.70
Standard Chartered		2015.06.30	2015.07.30		5,599	USD	5,000	1,119.72
Standard Chartered		2015.06.10	2015.07.09		5,548	USD	5,000	1,109.55
Nova Scotia		2015.06.17	2015.07.15		5,593	USD	5,000	1,118.60
Nova Scotia		2015.06.29	2015.07.27		5,619	USD	5,000	1,123.88
Standard Chartered		2015.06.22	2015.07.08		5,502	USD	5,000	1,100.42
Standard Chartered		2015.06.03	2015.07.02		5,529	USD	5,000	1,105.72
Deutsche Bank		2015.06.25	2015.07.22		5,555	USD	5,000	1,110.92
Nova Scotia		2015.06.17	2015.08.19		2,238	USD	2,000	1,119.10
Nova Scotia		2015.06.11	2015.08.17		4,149	USD	3,724	1,114.05
Nova Scotia		2015.06.30	2015.07.06		3,032	USD	2,707	1,120.10
Nova Scotia		2015.06.30	2015.09.02		5,586	USD	5,000	1,117.25
Barclays Bank PLC		2015.06.18	2015.08.24		5,549	USD	5,000	1,109.85
Barclays Bank PLC		2015.06.30	2015.09.02		6,707	USD	6,000	1,117.87
Societe Generale		2015.06.16	2015.08.18		2,238	USD	2,000	1,119.00
Societe Generale		2015.06.17	2015.08.19		2,238	USD	2,000	1,119.10
Societe Generale		2015.06.22	2015.08.24		5,503	USD	5,000	1,100.65
HSBC		2015.04.01	2015.07.03		11,054	USD	10,000	1,105.40
HSBC		2015.06.19	2015.08.24		5,517	USD	5,000	1,103.35
HSBC		2015.06.22	2015.08.24		5,501	USD	5,000	1,100.15
HSBC		2015.06.25	2015.08.24	USD	1,206		1,327	1,100.15
HSBC		2015.06.30	2015.09.02		4,473	USD	4,000	1,118.15
Mizuho Bank		2015.06.05	2015.08.10		2,227	USD	2,000	1,113.40
Mizuho Bank		2015.06.19	2015.08.24		3,311	USD	3,000	1,103.80
Credit Agricole		2015.06.22	2015.08.24		5,511	USD	5,000	1,102.17
Standard Chartered		2015.06.22	2015.09.10		3,230	USD	2,936	1,099.90

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

11.

Derivatives, Continued

(2)

Currency forward contracts which are not designated as hedge instruments, as of June 30, 2015 are as follows, continued:


In millions of won and thousands of foreign currencies
Counterparty	Contract Date		Maturity date	Contract amounts				Contract exchange rate
Counterparty	Contract Date		Maturity date	Pay		Receive		Contract exchange rate

Standard Chartered		2015.06.26	2015.07.03	￦	7,105	USD	6,369	1,115.64
Barclays Bank PLC		2015.06.25	2015.07.06		5,544	USD	5,000	1,108.82
Barclays Bank PLC		2015.06.25	2015.07.14		1,110	USD	1,000	1,110.00
HSBC		2015.06.19	2015.07.07		4,413	USD	4,000	1,103.17
Standard Chartered		2015.06.17	2015.07.01		3,355	USD	3,000	1,118.30
Nova Scotia		2015.06.19	2015.07.07		4,404	USD	4,000	1,101.00
Nova Scotia		2015.06.29	2015.07.07		1,123	USD	1,000	1,123.07
Nova Scotia		2015.06.26	2015.07.10		2,231	USD	2,000	1,115.48
Nonghyup Bank		2015.06.18	2015.07.03		2,220	USD	2,000	1,109.88
Nonghyup Bank		2015.06.18	2015.07.03		1,662	USD	1,500	1,107.88
Nonghyup Bank		2015.06.26	2015.07.10		2,229	USD	2,000	1,114.70
Mizuho Bank		2015.06.24	2015.07.01		1,885	USD	1,700	1,108.97
Busan Bank		2015.06.25	2015.07.14		6,658	USD	6,000	1,109.66
Societe Generale		2015.06.22	2015.09.24		10	USD	9	1,101.50
Societe Generale		2015.06.18	2015.09.22		4,536	USD	4,082	1,111.30
Societe Generale		2015.06.18	2015.09.22		5,552	USD	5,000	1,110.30
Standard Chartered		2015.06.09	2015.07.13		8,400	USD	7,500	1,119.95
Nova Scotia		2015.06.30	2015.10.02		5,587	USD	5,000	1,117.36
JP Morgan		2015.06.18	2015.09.22		5,547	USD	5,000	1,109.45
ING Bank N.V.		2015.04.27	2015.07.29		133	USD	124	1,076.10
HSBC		2015.06.18	2015.09.22		5,550	USD	5,000	1,109.90
Credit Suisse		2015.06.19	2015.09.23		5,517	USD	5,000	1,103.40
Credit Suisse		2015.06.18	2015.09.22		5,573	USD	5,000	1,114.60
Credit Agricole		2015.06.30	2015.10.02		5,586	USD	5,000	1,117.20
Credit Agricole		2015.06.30	2015.10.02		5,589	USD	5,000	1,117.80
Credit Agricole		2015.06.30	2015.10.02		5,054	USD	4,518	1,118.70
Credit Agricole		2015.06.18	2015.09.22		5,573	USD	5,000	1,114.60
Credit Agricole		2015.06.18	2015.09.22		5,551	USD	5,000	1,110.10
Standard Chartered		2015.06.18	2015.09.22		5,555	USD	5,000	1,111.00
HSBC		2015.06.18	2015.09.22		5,528	USD	4,985	1,109.10
Standard Chartered		2011.08.08	2015.07.27~2015.12.28	USD	4,588		5,025	1,093.10~1,096.70

(3)

Currency swap contracts which are not designated as hedge instruments as of June 30, 2015 are as follows:


In millions of won and thousands of foreign currencies
Counterparty	Contract year	Contract amount				Contract interest rate						Contract exchange rate
Counterparty	Contract year	Pay		Receive		Pay (%)			Receive (%)			Contract exchange rate

UBS	2011~2015	￦	220,356	USD	200,000		3.90	%		3.00	%		1,101.78
RBS	2011~2015		110,110	USD	100,000		3.90	%		3.00	%		1,101.10
Barclays Bank PLC	2011~2015		108,390	USD	100,000		3.78	%		3.00	%		1,083.90
Credit Suisse	2011~2015		108,390	USD	100,000		3.22	%		3.00	%		1,083.90
Morgan Stanley	2011~2015		63,006	USD	60,000		4.06	%		3.00	%		1,050.10
Goldman Sachs	2012~2015		156,643	USD	140,000		3.92	%		3.00	%		1,118.88
Deutsche Bank	2013~2018		110,412	JPY	10,000,000		6.21	%		4.19	%		11.04
IBK	2013~2018		111,800	USD	100,000		3.16	%		2.79	%		1,118.00
Bank of America	2013~2018		103,580	JPY	10,000,000		7.05	%		4.19	%		10.36
Credit Suisse	2014~2019		118,632	CHF	100,000		2.98	%		1.50	%		1,186.32
Standard Chartered	2014~2019		114,903	CHF	100,000		4.00	%		1.50	%		1,149.03
Standard Chartered	2014~2029		102,470	USD	100,000		3.14	%		3.57	%		1,024.70

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

11.

Derivatives, Continued

(3)

Currency swap contracts which are not designated as hedge instruments as of June 30, 2015 are as follows, continued:


In millions of won and thousands of foreign currencies
Counterparty	Contract year	Contract amount				Contract interest rate				Contract exchange rate
Counterparty	Contract year	Pay		Receive		Pay (%)			Receive (%)	Contract exchange rate

Standard Chartered	2014~2017	￦	51,215	USD	50,000		2.24	%	3M Libor+0.55%		1,024.30
Societe Generale	2014~2024		105,017	USD	100,000		4.92	%	5.13%		1,050.17
Korea Exchange Bank	2015~2024		107,970	USD	100,000		4.75	%	5.13%		1,079.70
Credit Agricole	2015~2024		94,219	USD	86,920		4.85	%	5.13%		1,083.97
Morgan Stanley	2010~2015		118,800	USD	100,000		4.61	%	3M Libor+1.64%		1,188.00
M-UFJ	2010~2015		116,100	USD	100,000		4.00	%	3M Libor+1.00%		1,161.00
Mizuho Bank	2014~2017		153,645	USD	150,000		2.35	%	3M Libor+0.65%		1,024.30
Citibank	2010~2015		116,080	USD	100,000		3.97	%	3.13%		1,160.80
Deutsche Bank	2010~2015		116,080	USD	100,000		3.98	%	3.13%		1,160.80
RBS	2010~2015		116,080	USD	100,000		3.97	%	3.13%		1,160.80
HSBC	2010~2015		116,080	USD	100,000		3.23	%	3.13%		1,160.80
UBS	2010~2015		116,080	USD	100,000		3.23	%	3.13%		1,160.80
Citibank	2012~2022		112,930	USD	100,000		2.79	%	3.00%		1,129.30
JP Morgan	2012~2022		112,930	USD	100,000		2.79	%	3.00%		1,129.30
Bank of America	2012~2022		112,930	USD	100,000		2.79	%	3.00%		1,129.30
Goldman Sachs	2012~2022		112,930	USD	100,000		2.79	%	3.00%		1,129.30
HSBC	2012~2022		111,770	USD	100,000		2.89	%	3.00%		1,117.70
Hana Bank	2012~2022		111,770	USD	100,000		2.87	%	3.00%		1,117.70
Standard Chartered	2012~2022		111,770	USD	100,000		2.89	%	3.00%		1,117.70
Deutsche Bank	2012~2022		55,885	USD	50,000		2.79	%	3.00%		1,117.70
DBS	2013~2018		108,140	USD	100,000		2.63	%	3M Libor+0.84%		1,081.40
DBS	2013~2018		108,140	USD	100,000		2.57	%	3M Libor+0.84%		1,081.40
DBS	2013~2018		108,140	USD	100,000		2.57	%	3M Libor+0.84%		1,081.40
HSBC	2013~2018		107,450	USD	100,000		3.41	%	2.88%		1,074.50
Standard Chartered	2013~2018		107,450	USD	100,000		3.44	%	2.88%		1,074.50
JP Morgan	2013~2018		107,450	USD	100,000		3.48	%	2.88%		1,074.50
Bank of America	2014~2018		107,450	USD	100,000		3.09	%	2.88%		1,074.50
Citibank	2014~2018		107,450	USD	100,000		3.09	%	2.88%		1,074.50
JP Morgan	2014~2017		102,670	USD	100,000		2.89	%	3M Libor+0.78%		1,026.70
Deutsche Bank	2014~2017		102,670	USD	100,000		2.89	%	3M Libor+0.78%		1,026.70
HSBC	2014~2019		105,260	USD	100,000		2.48	%	2.38%		1,052.60
Standard Chartered	2014~2019		105,260	USD	100,000		2.48	%	2.38%		1,052.60
RBS	2014~2019		105,260	USD	100,000		2.48	%	2.38%		1,052.60
Nomura	2015~2025		111,190	USD	100,000		2.60	%	3.25%		1,111.90
Korea Development Bank	2015~2025		111,190	USD	100,000		2.62	%	3.25%		1,111.90
Korea Exchange Bank	2015~2025		55,595	USD	50,000		2.62	%	3.25%		1,111.90
Woori Bank	2015~2025		55,595	USD	50,000		2.62	%	3.25%		1,111.90

(4)

Currency swap contracts which are designated as hedge instruments as of June 30, 2015 are as follows:


In millions of won and thousands of foreign currencies
Counterparty	Contract year	Contract amount				Contract interest rate		Contract exchange rate
Counterparty	Contract year	Pay		Receive		Pay (%)	Receive (%)	Contract exchange rate

Citibank	2006~2016	￦	113,200	USD	100,000	1.05%	6.00%		1,132.00
Barclays Bank PLC	2006~2016		113,200	USD	100,000	1.05%	6.00%		1,132.00
Credit Suisse	2006~2016		113,200	USD	100,000	1.05%	6.00%		1,132.00
Goldman Sachs	2011~2017		105,260	USD	100,000	3.99%	3.63%		1,052.60
Barclays Bank PLC	2011~2017		105,260	USD	100,000	3.99%	3.63%		1,052.60
Citibank	2011~2017		105,260	USD	100,000	3.99%	3.63%		1,052.60

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

11.

Derivatives, Continued

(4)

Currency swap contracts which are designated as hedge instruments as of June 30, 2015 are as follows, continued:


In millions of won and thousands of foreign currencies
Counterparty	Contract year	Contract amount				Contract interest rate		Contract exchange rate
Counterparty	Contract year	Pay		Receive		Pay (%)	Receive (%)	Contract exchange rate

Citibank	2013~2018	￦	54,570	USD	50,000	2.90%	3M Libor+1.01%		1,091.40
Standard Chartered	2013~2018		54,570	USD	50,000	2.90%	3M Libor+1.01%		1,091.40
Credit Suisse	2013~2018		111,410	USD	100,000	3.22%	3M Libor+1.50%		1,114.10
HSBC	2014~2020		99,901	AUD	100,000	3.52%	5.75%		999.01
HSBC	2014~2020		100,482	AUD	100,000	3.48%	5.75%		1,004.82
Standard Chartered	2013~2020	USD	117	AUD	125,000	3M Libor+1.25%	5.75%		0.94
Standard Chartered	2014~2020		126,032	USD	117,250	3.55%	3M Libor+1.25%		1,074.90
UBS AG	2006~2016		98,100	USD	100,000	5.48%	5.50%		981.00
Credit Suisse	2006~2016		98,100	USD	100,000	5.48%	5.50%		981.00
JP Morgan	2014~2019		107,190	USD	100,000	3.25%+3%*n/N	2.75%		1,071.90
Morgan Stanley	2014~2019		107,190	USD	100,000	3.25%+3%*n/N	2.75%		1,071.90
Barclays Bank PLC	2014~2019		107,190	USD	100,000	3.25%+3%*n/N	2.75%		1,071.90
Barclays Bank PLC	2006~2016		71,888	USD	75,000	4.81%	5.50%		958.50
Deutsche Bank AG	2006~2016		71,888	USD	75,000	4.81%	5.50%		958.50
Barclays Bank PLC	2012~2017		142,500	USD	125,000	3.83%	3.13%		1,140.00
Morgan Stanley	2012~2017		142,500	USD	125,000	3.83%	3.13%		1,140.00
RBS	2012~2017		142,500	USD	125,000	3.83%	3.13%		1,140.00
JP Morgan	2012~2017		142,500	USD	125,000	3.83%	3.13%		1,140.00
RBS	2013~2019		118,343	CHF	100,000	3.47%	1.63%		1,183.43
Barclays Bank PLC	2013~2019		59,172	CHF	50,000	3.47%	1.63%		1,183.43
Nomura	2013~2019		59,172	CHF	50,000	3.47%	1.63%		1,183.43
Barclays Bank PLC	2013~2018		107,360	USD	100,000	3.34%	2.88%		1,073.60
RBS	2013~2018		107,360	USD	100,000	3.34%	2.88%		1,073.60
JP Morgan	2013~2018		161,040	USD	150,000	3.34%	2.88%		1,073.60
Standard Chartered	2013~2018		161,040	USD	150,000	3.34%	2.88%		1,073.60
Standard Chartered	2014~2019		104,490	USD	100,000	2.77%	2.63%		1,044.90
RBS	2014~2019		104,490	USD	100,000	2.77%	2.63%		1,044.90
Barclays Bank PLC	2014~2019		104,490	USD	100,000	2.77%	2.63%		1,044.90
Barclays Bank PLC	2013~2018		81,188	USD	75,000	2.65%	1.88%		1,082.50
RBS	2013~2018		81,188	USD	75,000	2.65%	1.88%		1,082.50
Deutsche Bank	2013~2018		81,188	USD	75,000	2.65%	1.88%		1,082.50
Citibank	2013~2018		81,188	USD	75,000	2.65%	1.88%		1,082.50
Standard Chartered	2014~2017		54,205	USD	50,000	2.93%	3M Libor+1.05%		1,084.10
Credit Agricole	2014~2017		54,205	USD	50,000	2.93%	3M Libor+1.05%		1,084.10
BTMU	2010~2015		55,900	USD	50,000	4.03%	3M Libor+1.20%		1,118.00
RBS	2012~2017		115,140	USD	100,000	3.38%	2.50%		1,151.40
BNP Paribas	2012~2017		115,140	USD	100,000	3.38%	2.50%		1,151.40
Hana Bank	2012~2017		115,140	USD	100,000	3.38%	2.50%		1,151.40
Barclays Bank PLC	2012~2017		57,570	USD	50,000	3.38%	2.50%		1,151.40
Standard Chartered	2012~2017		57,570	USD	50,000	3.38%	2.50%		1,151.40
Nomura	2012~2017		57,570	USD	50,000	3.38%	2.50%		1,151.40
Credit Agricole	2012~2017		57,570	USD	50,000	3.38%	2.50%		1,151.40
Societe Generale	2013~2018		106,190	USD	100,000	3.48%	2.63%		1,061.90
BNP Paribas	2013~2018		53,095	USD	50,000	3.48%	2.63%		1,061.90
Hana Bank	2013~2018		53,095	USD	50,000	3.48%	2.63%		1,061.90
Standard Chartered	2013~2018		106,030	USD	100,000	3.48%	2.63%		1,060.30
Barclays Bank PLC	2013~2018		53,015	USD	50,000	3.48%	2.63%		1,060.30
Hana Bank	2013~2018		31,809	USD	30,000	3.48%	2.63%		1,060.30

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

11.

Derivatives, Continued

(4)

Currency swap contracts which are designated as hedge instruments as of June 30, 2015 are as follows, continued:


In millions of won and thousands of foreign currencies
Counterparty	Contract year	Contract amount				Contract interest rate		Contract exchange rate
Counterparty	Contract year	Pay		Receive		Pay (%)	Receive (%)	Contract exchange rate

Societe Generale	2013~2018	￦	21,206	USD	20,000	3.48%	2.63%		1,060.30
HSBC	2013~2018		53,015	USD	50,000	3.47%	2.63%		1,060.30
Nomura	2013~2018		53,015	USD	50,000	3.47%	2.63%		1,060.30
Credit Agricole	2014~2020		110,680	USD	100,000	2.29%	2.50%		1,106.80
Societe Generale	2014~2020		55,340	USD	50,000	2.16%	2.50%		1,106.80
Hana Bank	2014~2020		55,340	USD	50,000	2.16%	2.50%		1,106.80
Hana Bank	2014~2020		55,340	USD	50,000	2.21%	2.50%		1,106.80
Standard Chartered	2014~2020		55,340	USD	50,000	2.21%	2.50%		1,106.80
HSBC	2014~2020		55,340	USD	50,000	2.21%	2.50%		1,106.80
Nomura	2014~2020		55,340	USD	50,000	2.21%	2.50%		1,106.80
Barclays Bank PLC	2014~2020		55,340	USD	50,000	2.21%	2.50%		1,106.80
RBS	2014~2020		55,340	USD	50,000	2.21%	2.50%		1,106.80

(5)

Interest rate swap contracts which are not designated as hedge instruments as of June 30, 2015 are as follows:


In millions of won
Counterparty	Contract year	Contract amount		Contract interest rate per annum
Counterparty	Contract year	Contract amount		Pay (%)	Receive (%)

Korea Development Bank	2012~2016	￦	200,000	3.57%	3M CD + 0.26%
Nonghyup Bank	2012~2016		100,000	3.49%	3M CD + 0.25%
Korea Development Bank	2012~2016		50,000	3.49%	3M CD + 0.25%
HSBC	2012~2016		50,000	3.49%	3M CD + 0.25%
Standard Chartered	2012~2016		200,000	3.55%	3M CD + 0.26%
Standard Chartered	2012~2017		160,000	3.57%	3M CD + 0.32%
JP Morgan	2013~2018		150,000	3.58%	3M CD + 0.31%
Korea Exchange Bank	2012~2015		100,000	2.86%	3M CD + 0.05%
Korea Exchange Bank	2013~2016		100,000	2.82%	3M CD + 0.04%
Korea Exchange Bank	2013~2016		200,000	2.57%	3M CD + 0.04%
Korea Exchange Bank	2013~2016		100,000	2.75%	3M CD + 0.03%
Credit Suisse	2014~2018		200,000	2.98%	1Y CMT + 0.31%
Korea Development Bank (*)	2014~2029		40,000	3M CD - 0.03%	4.65%

(*)

The contract is an interest rate swap hedging on Electricity Bonds 885, and the banks would notify the Company of the early termination every year on the early termination notification date (every year on April 28, from 2017 until 2028). The contract will be terminated if the early termination is notified.

(6)

Interest rate swap contracts which are designated as hedge instruments, as of June 30, 2015 are as follows:


In thousands of U.S. dollars
Counterparty	Contract year	Contract amount		Contract interest rate per annum
Counterparty	Contract year	Contract amount		Pay (%)	Receive (%)

BNP Paribas	2009~2027	USD	102,538	4.16%	6M USD Libor
KFW	2009~2027	USD	102,538	4.16%	6M USD Libor
CA-CIB (Credit Agricole)	2014~2033	USD	104,880	3.98%~4.10%	6M USD Libor
SMBC	2014~2033	USD	137,151	4.05%~4.18%	6M USD Libor

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

11.

Derivatives, Continued

(7)

Gains and losses on valuation and transaction of derivatives for the three and six-month periods ended June 30, 2015 and 2014 are as follows and included in finance income and costs in the accompanying consolidated statements of comprehensive income (loss):


In millions of won	Net income effects of valuation gain (loss)											Net income effects of transaction gain (loss)												Accumulated other *comprehensive loss ()**
	June 30, 2015					June 30, 2014						June 30, 2015						June 30, 2014						June 30, 2015						June 30, 2014
	Three- month period ended		Six- month period ended			Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended
Currency option	￦	—		—			853			(87	)		—			—			(3,693	)		18,413			—			—			—			—
Currency forward		35,910		38,786			(8,392	)		(8,350	)		(7,376	)		(3,838	)		(1,329	)		205			—			—			—			—
Currency swap		111,290		179,857			(528,427	)		(380,776	)		2,935			(2,414	)		(56,561	)		(65,113	)		(58,058	)		(23,391	)		(40,647	)		(46,210	)
Interest rate swap		4,931		(1,749	)		(4,484	)		(7,591	)		1,225			582			(770	)		(2,112	)		—			(7,920	)		(13,883	)		(7,362	)
Others		—		—			—			—			—			—			144			(1,466	)		—			—			—			—


	￦	152,131		216,894			(540,450	)		(396,804	)		(3,216	)		(5,670	)		(62,209	)		(50,073	)		(58,058	)		(31,311	)		(54,530	)		(53,572	)

(*)	As of June 30, 2015, the accumulated net loss on valuation of derivatives using cash flow hedge accounting of ￦21,360 million, net of tax, is included in accumulated other comprehensive loss.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

12.

Other Financial Assets

(1)

Other financial assets as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015						December 31, 2014
	Current			Non-current			Current			Non-current

Loans and receivables	￦	103,249			638,604			68,910			611,610
Present value discount		(1,353	)		(51,175	)		(1,067	)		(55,456	)
Long-term/short-term financial instruments		1,585,107			605,261			100,099			604,363


	￦	1,687,003			1,192,690			167,942			1,160,517

(2)

Loans and receivables as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Face value		Present value discount			Book value
Short-term loans and receivables
Loans for tuition	￦	28,999		(1,353	)		27,646
Loans for housing		6,143		—			6,143
Fisheries loan		6,032		—			6,032
Other loans		62,075		—			62,075

		103,249		(1,353	)		101,896

Long-term loans and receivables
Loans for tuition		383,965		(50,563	)		333,402
Loans for housing		74,342		—			74,342
Loans for related parties		110,279		—			110,279
Fisheries loan		4,720		(612	)		4,108
Other loans		65,298		—			65,298

		638,604		(51,175	)		587,429


	￦	741,853		(52,528	)		689,325


In millions of won	December 31, 2014
	Face value		Present value discount			Book value
Short-term loans and receivables
Loans for tuition	￦	25,828		(1,067	)		24,761
Loans for housing		12,050		—			12,050
Fisheries loan		6,032		—			6,032
Other loans		25,000		—			25,000

		68,910		(1,067	)		67,843

Long-term loans and receivables
Loans for tuition		379,797		(54,569	)		325,228
Loans for housing		110,152		—			110,152
Loans for related parties		111,033		—			111,033
Fisheries loan		7,696		(887	)		6,809
Other loans		2,932		—			2,932

		611,610		(55,456	)		556,154


	￦	680,520		(56,523	)		623,997

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

12.

Other Financial Assets, Continued

(3)

Long-term and short-term financial instruments as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015				December 31, 2014
	Current		Non-current		Current		Non-current

Time deposits	￦	1,018,087		1,634		90,088		742
Asset-Backed Commercial Paper		490,000		—		—		—
Special money in trust		27,020		—		10,011		—
CD		50,000		—		—		—
MMT		—		603,306		—		303,306
MMDA		—		—		—		300,000
Others		—		321		—		315


	￦	1,585,107		605,261		100,099		604,363

13.

Inventories

Inventories as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Acquisition cost		Valuation allowance			Book value

Raw materials	￦	3,186,644		(1,130	)		3,185,514
Merchandises		443		—			443
Work-in-progress		104,054		—			104,054
Finished goods		71,645		—			71,645
Supplies		920,439		(1,193	)		919,246
Inventories in transit		538,483		—			538,483
Other inventories		8,432		—			8,432


	￦	4,830,140		(2,323	)		4,827,817


In millions of won	December 31, 2014
	Acquisition cost		Valuation allowance			Book value

Raw materials	￦	3,039,422		(1,130	)		3,038,292
Merchandises		212		—			212
Work-in-progress		93,498		—			93,498
Finished goods		59,222		—			59,222
Supplies		840,463		(2,685	)		837,778
Inventories in transit		500,466		—			500,466
Other inventories		8,001		—			8,001


	￦	4,541,284		(3,815	)		4,537,469

The reversal of the allowance for loss on inventory valuation due to increases in the net realizable value of inventory deducted from cost of sales were ￦2,375 million and ￦3,029 million for the six-month period ended June 30, 2015 and for the year ended December 31, 2014, respectively. The amounts of loss from inventory valuation included in other gains (losses) for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 were ￦883 million and ￦2,709 million, respectively.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

14.

Finance Lease Receivables

(1)

Finance lease contracts

The Company entered into a power purchase agreement (“PPA”) with Jordan Electric Power Company to provide a 373MW level Qatrana gas combined power plant over a 25 year lease term, and accounts for the PPA as a finance lease. Also, the Company has fly-ash pipe conduit finance leases with an average lease term of 7 years. In addition the Company entered into a PPA with the Comision Federal de Electricidad in Mexico to provide for 25 years of all electricity generated from the power plant after completion of its construction and collect rates consisting of fixed costs (to recover the capital) and variable costs during the contracted period.

(2)

Finance lease receivables as of June 30, 2015 and December 31, 2014 are as follows and included in current and non-current trade and other receivables, net, in the accompanying consolidated statements of financial position:


In millions of won	June 30, 2015				December 31, 2014
	Minimum lease payments		Present value of minimum lease payments		Minimum lease payments		Present value of minimum lease payments

Less than 1 year	￦	91,417		9,712		88,698		8,275
1 ~ 5 years		389,793		230,748		378,703		237,062
More than 5 years		1,663,878		664,960		1,675,685		640,417


	￦	2,145,088		905,420		2,143,086		885,754

(3)

There are no impaired finance lease receivables as of June 30, 2015 and December 31, 2014.

15.

Non-Financial Assets

(1)

Non-financial assets as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015				December 31, 2014
	Current		Non-current		Current		Non-current

Advance payment	￦	103,853		19,867		109,112		12,516
Prepaid expenses		180,561		89,205		154,047		97,972
Others (*)		149,676		20,715		239,352		23,605


	￦	434,090		129,787		502,511		134,093

(*)	Details of others as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015				December 31, 2014
	Current		Non-current		Current		Non-current

Tax refund receivables	￦	67,136		1,061		182,564		1,037
Others		82,540		19,654		56,788		22,568


	￦	149,676		20,715		239,352		23,605

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

16.

Consolidated Subsidiaries

(1)

Consolidated subsidiaries as of June 30, 2015 and December 31, 2014 are as follows:


Subsidiaries	Key operation activities	Location	Percentage of ownership (%)
Subsidiaries	Key operation activities	Location	June 30, 2015			December 31, 2014

Korea Hydro & Nuclear Power Co., Ltd.	Power generation	KOREA		100.00	%		100.00	%
Korea South-East Power Co., Ltd.	Power generation	KOREA		100.00	%		100.00	%
Korea Midland Power Co., Ltd.	Power generation	KOREA		100.00	%		100.00	%
Korea Western Power Co., Ltd.	Power generation	KOREA		100.00	%		100.00	%
Korea Southern Power Co., Ltd.	Power generation	KOREA		100.00	%		100.00	%
Korea East-West Power Co., Ltd.	Power generation	KOREA		100.00	%		100.00	%
KEPCO Engineering & Construction Company, Inc. (*1)	Architectural engineering for utility plant and others	KOREA		66.32	%		66.32	%
KEPCO Plant Service & Engineering Co., Ltd.	Utility plant maintenance and others	KOREA		52.48	%		54.00	%
KEPCO Nuclear Fuel Co., Ltd.	Nuclear fuel	KOREA		96.36	%		96.36	%
KEPCO KDN Co., Ltd.	Electric power information technology and others	KOREA		100.00	%		100.00	%
Garorim Tidal Power Plant Co., Ltd. (*2)	Power generation	KOREA		49.00	%		49.00	%
KEPCO International HongKong Ltd.	Holding company	HONG KONG		100.00	%		100.00	%
KEPCO International Philippines Inc.	Holding company	PHILIPPINES		100.00	%		100.00	%
KEPCO Gansu International Ltd.	Holding company	HONG KONG		100.00	%		100.00	%
KEPCO Philippines Holdings Inc.	Holding company	PHILIPPINES		100.00	%		100.00	%
KEPCO Philippines Corporation	Operation of utility plant	PHILIPPINES		100.00	%		100.00	%
KEPCO Ilijan Corporation	Utility plant rehabilitation and operation	PHILIPPINES		51.00	%		51.00	%
KEPCO Lebanon SARL	Operation of utility plant	LEBANON		100.00	%		100.00	%
KEPCO Neimenggu International Ltd.	Holding company	HONG KONG		100.00	%		100.00	%
KEPCO Shanxi International Ltd.	Holding company	HONG KONG		100.00	%		100.00	%
KOMIPO Global Pte Ltd.	Holding company	SINGAPORE		100.00	%		100.00	%
KEPCO Canada Energy Ltd.	Resources development	CANADA		100.00	%		100.00	%
KEPCO Netherlands B.V.	Holding company	NETHERLANDS		100.00	%		100.00	%
KOREA Imouraren Uranium Investment Corp.	Uranium mine development	FRANCE		100.00	%		100.00	%
KEPCO Australia Pty., Ltd.	Resources development	AUSTRALIA		100.00	%		100.00	%
KOSEP Australia Pty., Ltd.	Resources development	AUSTRALIA		100.00	%		100.00	%
KOMIPO Australia Pty., Ltd.	Resources development	AUSTRALIA		100.00	%		100.00	%
KOWEPO Australia Pty., Ltd.	Resources development	AUSTRALIA		100.00	%		100.00	%
KOSPO Australia Pty., Ltd.	Resources development	AUSTRALIA		100.00	%		100.00	%
KEPCO Middle East Holding Company	Holding company	BAHRAIN		100.00	%		100.00	%
Qatrana Electric Power Company	Construction and operation of utility plant	JORDAN		80.00	%		80.00	%
KHNP Canada Energy Ltd.	Resources development	CANADA		100.00	%		100.00	%
KEPCO Bylong Australia Pty., Ltd.	Resources development	AUSTRALIA		100.00	%		100.00	%
Korea Waterbury Uranium Limited Partnership	Resources development	CANADA		79.64	%		79.64	%
KEPCO Canada Uranium Investment Limited Partnership	Resources development	CANADA		100.00	%		100.00	%
Korea Electric Power Nigeria Ltd.	Operation of utility plant	NIGERIA		100.00	%		100.00	%
KEPCO Holdings de Mexico	Holding company	MEXICO		100.00	%		100.00	%
KST Electric Power Company	Construction and operation of utility plant	MEXICO		56.00	%		56.00	%
KEPCO Energy Service Company	Operation of utility plant	MEXICO		100.00	%		100.00	%
KEPCO Netherlands S3 B.V.	Holding company	NETHERLANDS		100.00	%		100.00	%
PT. KOMIPO Pembangkitan Jawa Bali	Operation of utility plant	INDONESIA		51.00	%		51.00	%
PT. Cirebon Power Service (*2)	Operation of utility plant	INDONESIA		27.50	%		27.50	%
KOWEPO International Corporation	Operation of utility plant	PHILIPPINES		99.99	%		99.99	%
KOSPO Jordan LLC	Operation of utility plant	JORDAN		100.00	%		100.00	%
EWP Philippines Corporation	Operation of utility plant	PHILIPPINES		100.00	%		100.00	%
EWP America Inc.	Holding company	USA		100.00	%		100.00	%
EWP Renewable Co.	Holding company	USA		100.00	%		100.00	%
DG Fairhaven Power, LLC	Power generation	USA		100.00	%		100.00	%
DG Kings Plaza, LLC	Power generation	USA		100.00	%		100.00	%

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

16.

Consolidated Subsidiaries, Continued

(1)

Consolidated subsidiaries as of June 30, 2015 and December 31, 2014 are as follows, continued:


Subsidiaries	Key operation activities	Location	Percentage of ownership (%)
Subsidiaries	Key operation activities	Location	June 30, 2015			December 31, 2014

DG Whitefield, LLC	Power generation	USA		100.00	%		100.00	%
Springfield Power, LLC	Power generation	USA		100.00	%		100.00	%
KNF Canada Energy Limited	Resources development	CANADA		96.36	%		96.36	%
PT KEPCO Resource Indonesia	Resources development	INDONESIA		100.00	%		100.00	%
EWP Barbados 1 SRL	Holding company	BARBADOS		100.00	%		100.00	%
California Power Holdings, LLC	Power generation	USA		100.00	%		100.00	%
Gyeonggi Green Energy Co., Ltd.	Power generation	KOREA		62.01	%		62.01	%
PT. Tanggamus Electric Power	Power generation	INDONESIA		52.50	%		60.00	%
Gyeongju Wind Power Co., Ltd.	Power generation	KOREA		70.00	%		70.00	%
KOMIPO America Inc.	Holding company	USA		100.00	%		100.00	%
Boulder Solar Power, LLC	Solar photovoltaic power generation	USA		—			82.14	%
EWPRC Biomass Holdings, LLC	Holding company	USA		100.00	%		100.00	%
KOSEP USA, INC.	Power generation	USA		100.00	%		100.00	%
PT. EWP Indonesia	Holding company	INDONESIA		100.00	%		100.00	%
KOWEPO America LLC	Solar photovoltaic power generation	USA		100.00	%		100.00	%
KEPCO Netherlands J3 B.V.	Holding company	NETHERLANDS		100.00	%		100.00	%
Korea Offshore Wind Power Co., Ltd.	Power generation	KOREA		100.00	%		100.00	%
Global One Pioneer B.V.	Holding company	NETHERLANDS		100.00	%		100.00	%
Global Energy Pioneer B.V.	Holding company	NETHERLANDS		100.00	%		100.00	%
Mira Power Limited (*3)	Power generation	PAKISTAN		76.00	%		76.00	%
KOSEP Material Co., Ltd.(*4)	Power generation	KOREA		46.22	%		46.22	%
Commerce and Industry Energy Co., Ltd.	Power generation	KOREA		59.03	%		59.03	%
KEPCO Singapore Holdings Pte., Ltd.	Holding company	SINGAPORE		100.00	%		100.00	%
KOWEPO India Private Limited	Holding company	INDIA		100.00	%		100.00	%
KEPCO KPS Philippines Corp.	Utility plant maintenance and others	PHILIPPINES		100.00	%		100.00	%
KOSPO Chile SpA	Holding company	CHILE		100.00	%		100.00	%
PT. KOWEPO Sumsel Operation and Maintenance Services	Utility plant maintenance and others	INDONESIA		95.00	%		95.00	%
HeeMang Sunlight Power Co., Ltd.	Power generation	KOREA		100.00	%		—

(*1)	Considering treasury stocks, the effective percentage of ownership is 66.62%.

(*2)	These subsidiaries are included in the consolidated financial statements as the Company obtained the majority of the voting power through the shareholders’ agreement.

(*3)	As of reporting date, the reporting period of all subsidiaries is December 31, except for Mira Power Limited which is Novemeber 30.

(*4)

According to the shareholders’ agreement reached in April 2014, Korea South-East Power Co., Ltd. (“KOSEP”) signed a contract with Long Lasting Value(“LLV”) to guarantee the principal and certain rate of return on LLV’s shares in KOSEP Material Co., Ltd. Moreover, LLV has put options to sell their investment to KOSEP. Therefore, the Company accounted for this agreement as KOSEP acquiring the shares of KOSEP Material from LLV during the six-month period ended June 30, 2015. As such, the effective percentage of ownership is 86.20% as of June 30, 2015.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

16.

Consolidated Subsidiaries, Continued

(2)

Subsidiaries included or excluded from consolidation for the six-month period ended June 30, 2015 are as follows:


Subsidiary		Reason

HeeMang Sunlight Power Co., Ltd.		Newly Established


Subsidiary		Reason

Boulder Solar Power, LLC		Disposed

(3)

Summary of financial information of consolidated subsidiaries as of and for the six-month period ended June 30, 2015 and as of and for the year ended December 31, 2014 are as follows:


In millions of won
June 30, 2015
Subsidiaries	Total assets		Total liabilities		Sales		Profit (loss) for the period

Korea Hydro & Nuclear Power Co., Ltd.	￦	49,128,233		27,289,507		4,638,420		643,151
Korea South-East Power Co., Ltd.		8,863,762		4,761,184		2,402,245		226,385
Korea Midland Power Co., Ltd.		7,570,848		4,504,797		1,918,194		85,273
Korea Western Power Co., Ltd.		8,760,287		5,455,267		2,198,279		93,330
Korea Southern Power Co., Ltd.		8,789,168		5,269,562		2,145,585		56,848
Korea East-West Power Co., Ltd.		8,501,560		4,769,958		2,045,194		193,938
KEPCO Engineering & Construction Company, Inc.		790,759		393,710		321,957		13,876
KEPCO Plant Service & Engineering Co., Ltd.		1,013,536		316,260		538,578		72,612
KEPCO Nuclear Fuel Co., Ltd.		589,465		269,696		106,359		16,123
KEPCO KDN Co., Ltd.		400,297		142,522		203,322		8,613
Garorim Tidal Power Plant Co., Ltd.		663		346		—		(69	)
KEPCO International HongKong Ltd.		163,340		—		—		2,630
KEPCO International Philippines Inc.		103,991		216		—		13,447
KEPCO Gansu International Ltd.		16,694		518		—		(6	)
KEPCO Philippines Holdings Inc.		133,086		1		—		12,924
KEPCO Philippines Corporation		13,109		129		—		(501	)
KEPCO Ilijan Corporation		587,616		47,575		61,775		22,425
KEPCO Lebanon SARL		739		9,762		—		(1,472	)
KEPCO Neimenggu International Ltd.		189,347		—		—		15,478
KEPCO Shanxi International Ltd.		518,124		240,657		—		(6,865	)
KOMIPO Global Pte Ltd.		170,148		32		—		7,069
KEPCO Canada Energy Ltd.		66,543		108		—		(17	)
KEPCO Netherlands B.V.		161,049		73		—		(131	)
KOREA Imouraren Uranium Investment Corp.		214,935		219		—		(24	)
KEPCO Australia Pty., Ltd.		516,599		2,378		2,522		224
KOSEP Australia Pty., Ltd.		19,090		1,070		2,518		(57	)
KOMIPO Australia Pty., Ltd.		18,570		552		2,518		(52	)
KOWEPO Australia Pty., Ltd.		19,315		1,137		2,518		(42	)
KOSPO Australia Pty., Ltd.		19,280		1,067		2,518		(49	)
KEPCO Middle East Holding Company		121,402		139,533		—		(1,006	)
Qatrana Electric Power Company		571,052		468,257		8,995		9,843
KHNP Canada Energy Ltd.		45,936		56		—		(16	)
KEPCO Bylong Australia Pty., Ltd.		168,524		213,625		—		(15,064	)
Korea Waterbury Uranium Limited Partnership		21,128		27		—		(21	)
KEPCO Canada Uranium Investment Limited Partnership		53,877		18		—		(9	)

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

16.

Consolidated Subsidiaries, Continued

(3)

Summary of financial information of consolidated subsidiaries as of and for the six-month period ended June 30, 2015 and as of and for the year ended December 31, 2014 are as follows, continued:


In millions of won
June 30, 2015
Subsidiaries	Total assets		Total liabilities		Sales		Profit (loss) for the period

Korea Electric Power Nigeria Ltd.	￦	1,744		835		27,404		538
KEPCO Holdings de Mexico		11		26		—		(5	)
KST Electric Power Company		529,840		514,101		46,238		4,100
KEPCO Energy Service Company		437		401		2,243		(4	)
KEPCO Netherlands S3 B.V.		63,948		26		—		(47	)
PT. KOMIPO Pembangkitan Jawa Bali		18,012		5,408		11,583		6,887
PT. Cirebon Power Service		2,393		917		2,931		215
KOWEPO International Corporation		—		—		—		—
KOSPO Jordan, LLC.		9,831		1,292		5,193		(162	)
EWP Philippines Corporation		6,840		35		—		417
EWP America Inc. (*)		106,207		78,521		26,124		(1,113	)
KNF Canada Energy Limited		2,028		46		—		(61	)
PT KEPCO Resource Indonesia		1,246		—		—		(126	)
EWP Barbados 1 SRL		249,657		150		1,374		144
Gyeonggi Green Energy Co., Ltd.		325,841		254,754		54,412		1,290
PT. Tanggamus Electric Power		81,083		62,849		25,311		(3,616	)
Gyeongju Wind Power Co., Ltd.		46,907		29,354		3,668		1,053
KOMIPO America Inc.		12,970		2,390		—		233
KOSEP USA, INC.		37,389		2,755		2,259		385
PT. EWP Indonesia		1,251		—		—		(99	)
KOWEPO America, LLC.		5,991		18		—		(494	)
KEPCO Netherlands J3 B.V.		116,363		53		—		(41	)
Korea Offshore Wind Power Co., Ltd.		8,620		853		—		(1,708	)
Global One Pioneer B.V.		7		20		—		(30	)
Global Energy Pioneer B.V.		9		20		—		(29	)
Mira Power Limited		46,005		1,554		—		(527	)
KOSEP Material Co., Ltd.		41,314		23,710		—		(1,816	)
Commerce and Industry Energy Co., Ltd.		102,204		86,769		12,786		(891	)
KEPCO Singapore Holdings Pte., Ltd.		1,533		6		—		(1	)
KOWEPO India Private Limited		951		116		—		(71	)
KEPCO KPS Philippines Corp.		6,685		2,543		7,463		1,087
KOSPO Chile SpA		233		4,453		—		(370	)
PT. KOWEPO Sumsel Operation & Maintenance Services		2,808		1,987		1,879		595
HeeMang Sunlight Power Co., Ltd.		4,720		—		—		—

(*)	Financial information of EWP America Inc. includes that of seven other subsidiaries, EWP Renewable Co., Ltd., DG Fairhaven Power, LLC., DG Kings Plaza, LLC., DG Whitefield, LLC., Springfield Power, LLC., California Power Holdings, LLC., and EWPRC Biomass Holdings, LLC.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

16.

Consolidated Subsidiaries, Continued

(3)

Summary of financial information of consolidated subsidiaries as of and for the six-month period ended June 30, 2015 and as of and for the year ended December 31, 2014 are as follows, continued:


In millions of won
December 31, 2014
Subsidiaries	Total assets		Total liabilities		Sales		Profit (loss) for the period

Korea Hydro & Nuclear Power Co., Ltd.	￦	49,237,136		27,588,281		9,379,564		1,446,060
Korea South-East Power Co., Ltd.		9,026,146		5,068,092		4,469,415		383,233
Korea Midland Power Co., Ltd.		7,074,578		4,073,784		5,041,682		110,533
Korea Western Power Co., Ltd.		8,245,105		5,008,954		4,840,007		151,662
Korea Southern Power Co., Ltd.		8,703,362		5,229,934		6,209,536		68,481
Korea East-West Power Co., Ltd.		8,370,732		4,805,302		4,507,011		168,534
KEPCO Engineering & Construction Company, Inc.		777,612		370,482		841,917		54,759
KEPCO Plant Service & Engineering Co., Ltd.		922,843		226,774		1,078,526		166,847
KEPCO Nuclear Fuel Co., Ltd.		568,370		257,899		241,310		32,588
KEPCO KDN Co., Ltd.		390,681		135,341		458,960		20,228
Garorim Tidal Power Plant Co., Ltd.		772		387		—		(39,856	)
KEPCO International HongKong Ltd.		182,703		—		—		6,221
KEPCO International Philippines Inc.		101,864		405		—		98,878
KEPCO Gansu International Ltd.		16,330		506		—		(11	)
KEPCO Philippines Holdings Inc.		124,418		40		—		5,987
KEPCO Philippines Corporation		13,670		139		—		(959	)
KEPCO Ilijan Corporation		585,190		53,212		127,871		76,627
KEPCO Lebanon SARL		6,990		9,832		—		(164	)
KEPCO Neimenggu International Ltd.		182,140		—		—		(172	)
KEPCO Shanxi International Ltd.		523,357		245,170		—		1,935
KOMIPO Global Pte Ltd.		157,441		3,636		—		9,470
KEPCO Canada Energy Ltd.		69,507		113		—		(18	)
KEPCO Netherlands B.V.		189,121		14		—		367
KOREA Imouraren Uranium Investment Corp.		227,897		207		—		(48	)
KEPCO Australia Pty., Ltd.		539,961		2,572		4,532		799
KOSEP Australia Pty., Ltd.		19,771		935		4,786		2,413
KOMIPO Australia Pty., Ltd.		18,779		542		4,786		1,786
KOWEPO Australia Pty., Ltd.		19,990		1,004		4,786		2,434
KOSPO Australia Pty., Ltd.		18,983		932		4,439		2,007
KEPCO Middle East Holding Company		116,615		133,338		—		(1,470	)
Qatrana Electric Power Company		553,134		462,329		17,079		15,724
KHNP Canada Energy Ltd.		47,982		58		—		(17	)
KEPCO Bylong Australia Pty., Ltd.		169,209		200,443		—		(20,958	)
Korea Waterbury Uranium Limited Partnership		22,058		35		—		(59	)
KEPCO Canada Uranium Investment Limited Partnership		70,778		25		—		(30	)
Korea Electric Power Nigeria Ltd.		1,112		786		23,863		204
KEPCO Holdings de Mexico		11		21		—		(12	)
KST Electric Power Company		512,793		496,780		16,668		13,496
KEPCO Energy Service Company		374		535		5,032		40
KEPCO Netherlands S3 B.V.		62,583		30		—		812
PT. KOMIPO Pembangkitan Jawa Bali		17,282		6,034		21,276		8,929
PT. Cirebon Power Service		1,630		402		6,694		354
KOWEPO International Corporation		—		—		—		(1,861	)
KOSPO Jordan, LLC.		10,270		1,742		29,682		2,512
EWP Philippines Corporation		6,570		283		—		(848	)
EWP America Inc. (*)		104,855		76,669		57,251		(21	)
KNF Canada Energy Limited		2,118		48		—		(65	)
PT KEPCO Resource Indonesia		1,366		13		—		(267	)
EWP Barbados 1 SRL		296,278		162		2,633		322
Gyeonggi Green Energy Co., Ltd.		334,074		264,278		124,181		(4,989	)
PT. Tanggamus Electric Power		24,120		8,339		20,089		(3,125	)
Gyeongju Wind Power Co., Ltd.		48,570		30,225		7,871		2,590
KOMIPO America Inc.		10,118		7		—		—
Boulder Solar Power, LLC.		8,457		7		—		(712	)
KOSEP USA, INC.		35,062		1,581		2,315		(119	)

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

16.

Consolidated Subsidiaries, Continued

(3)

Summary of financial information of consolidated subsidiaries as of and for the six-month period ended June 30, 2015 and as of and for the year ended December 31, 2014 are as follows, continued:


In millions of won
December 31, 2014
Subsidiaries	Total assets		Total liabilities		Sales		Profit (loss) for the period

PT. EWP Indonesia	￦	902		15		—		(278	)
KOWEPO America, LLC.		5,813		137		—		(1,006	)
KEPCO Netherlands J3 B.V.		113,818		44		—		(61	)
Korea Offshore Wind Power Co., Ltd.		11,762		2,287		—		(3,424	)
Global One Pioneer B.V.		40		24		—		(60	)
Global Energy Pioneer B.V.		42		29		—		(64	)
Mira Power Limited		32,977		221		—		(1,109	)
KOSEP Material Co., Ltd.		42,766		23,226		—		(2,463	)
Commerce and Industry Energy Co., Ltd.		103,346		87,047		23,645		(881	)
KEPCO Singapore Holdings Pte., Ltd.		1,012		—		—		(20	)
KOWEPO India Private Limited		997		11		—		(397	)
KEPCO KPS Philippines Corp.		5,147		2,150		9,263		1,912
KOSPO Chile SpA		3,143		4,354		—		(1,640	)
PT. KOWEPO Sumsel Operation & Maintenance Services		1,628		1,386		—		(408	)

(*)	Financial information of EWP America Inc. includes that of seven other subsidiaries, EWP Renewable Co., Ltd., DG Fairhaven Power, LLC., DG Kings Plaza, LLC., DG Whitefield, LLC., Springfield Power, LLC., California Power Holdings, LLC., and EWPRC Biomass Holdings, LLC.

(4)

Significant restrictions on abilities to subsidiaries are as follows:


Company		Nature and extent of any significant restrictions
Gyeonggi Green Energy Co., Ltd.		Acquisition or disposal of assets more than ￦35 billion, change in the capacity of cogeneration units (except for the change due to performance improvement of equipment, maintenance) will require unanimous consent of all directors.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

16.

Consolidated Subsidiaries, Continued

(5)

Details of non-controlling interest prior to intra-group eliminations as of and for the six-month period ended June 30, 2015 and as of and for the year ended December 31, 2014 are as follows:


In millions of won
June 30, 2015
Description	KEPCO Ilijan Corporation			KEPCO Plant Service & Engineering Co., Ltd.			KEPCO Engineering & Construction Company, Inc.			Others			Total

Percentage of ownership		49.00	%		47.52	%		33.37	%
Current assets	￦	142,784			549,854			264,195			624,183			1,581,016
Non-current assets		444,832			463,682			526,564			1,761,354			3,196,432
Current liabilities		(13,494	)		(259,652	)		(328,648	)		(244,019	)		(845,813	)
Non-current liabilities		(34,081	)		(56,608	)		(65,062	)		(1,478,272	)		(1,634,023	)
Net assets		540,041			697,276			397,049			663,246			2,297,612
Book value of non-controlling interest		264,620			331,347			132,495			611,859			1,340,321
Sales		61,775			538,578			321,957			281,624			1,203,934
Profit for the period		22,425			72,612			13,876			35,334			144,247
Profit for the period attributable to non-controlling interest		10,988			34,505			4,630			6,938			57,061
Cash flows from operating activities		35,646			183,711			35,230			(2,431	)		252,156
Cash flows from investing activities		(15,105	)		(40,124	)		(101,042	)		(56,652	)		(212,923	)
Cash flows from financing activities before dividends to non-controlling interest		(13,990	)		(40,581	)		13,605			91,483			50,517
Dividends to non-controlling interest		(12,386	)		(34,569	)		(7,300	)		(10,279	)		(64,534	)
Effect of exchange rate fluctuation		1,377			(65	)		(276	)		1,991			3,027
Net increase (decrease) of cash and cash equivalents		(4,458	)		68,372			(59,783	)		24,112			28,243


In millions of won
December 31, 2014
Description	KEPCO Ilijan Corporation			KEPCO Plant Service & Engineering Co., Ltd.			KEPCO Engineering & Construction Company, Inc.			Garorim Tidal Power Plant Co., Ltd.			Others			Total

Percentage of ownership		49.00	%		46.00	%		33.37	%		51.00	%
Current assets	￦	143,229			461,750			355,292			729			605,778			1,566,778
Non-current assets		441,961			461,093			422,320			43			2,301,291			3,626,708
Current liabilities		(19,022	)		(181,871	)		(315,766	)		(387	)		(391,393	)		(908,439	)
Non-current liabilities		(34,190	)		(44,903	)		(54,716	)		—			(1,765,520	)		(1,899,329	)
Net assets		531,978			696,069			407,130			385			750,156			2,385,718
Book value of non-controlling interest		260,669			320,192			135,859			197			616,443			1,333,360
Sales		127,871			1,078,526			841,917			—			531,983			2,580,297
Profit (loss) for the period		76,627			166,847			54,759			(39,856	)		54,875			313,252
Profit (loss) for the period attributable to non-controlling interest		37,547			61,734			15,853			(20,326	)		24,014			118,822
Cash flows from operating activities		111,248			183,865			16,226			(4,818	)		53,990			360,511
Cash flows from investing activities		(3,221	)		(70,186	)		(14,066	)		(1,454	)		(64,720	)		(153,647	)
Cash flows from financing activities before dividends to non-controlling interest		(116,956	)		(43,092	)		(19,258	)		—			35,825			(143,481	)
Dividends to non-controlling interest		(96,533	)		(25,308	)		(4,905	)		—			(4,224	)		(130,970	)
Effect of exchange rate fluctuation		2,456			70			(147	)		69			5,858			8,306
Net increase (decrease) of cash and cash equivalents		(103,006	)		45,349			(22,150	)		(6,203	)		26,729			(59,281	)

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

16.

Consolidated Subsidiaries, Continued

(6)

Changes in goodwill

(i)

Details of goodwill as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won
	June 30, 2015		December 31, 2014

Acquisition cost	￦	2,582		2,582
Accumulated impairment		—		—


Carrying book value	￦	2,582		2,582

(ii)

There are no changes in goodwill for the six-month period ended June 30, 2015 and for the year ended December 31, 2014.

(7)

Disposals of subsidiaries

The Company disposed the shares of Boulder Solar Power LLC. for the six-month period ended June 30, 2015. The Company also disposed the shares of Korea Engineering & Power Services Co., Ltd. and liquidated EWP Philippine Holdings Corporation for the year ended December 31, 2014.

(i)

The fair value of sales price as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won
	June 30, 2015		December 31, 2014

Consideration received in cash	￦	553		46,476
The fair value of remaining shares after disposal		11,823		—


Total	￦	12,376		46,476

(ii)

The carrying value of assets and liabilities of subsidiaries as at the date the Company lost its control during the six-month period ended June 30, 2015 and during the year ended December 31, 2014 are as follows:


In millions of won
	June 30, 2015			December 31, 2014
Current assets
Cash and cash equivalents	￦	—			2,187
Current financial assets, net		1,077			4,781
Trade and other receivables, net		—			5,460
Current non-financial assets		—			232

Non-current assets
Non-current financial assets, net		—			144
Non-current trade and other receivables, net		—			351
Property, plant and equipment, net		2,460			934
Other		2,893			50


Current liabilities
Trade and other payables, net		—			(1,655	)
Current non-financial liabilities		(7	)		(161	)


	￦	6,423			12,323

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

16.

Consolidated Subsidiaries, Continued

(7)

Disposals of subsidiaries, continued

(iii)

Gain from disposals of subsidiaries for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won
	June 30, 2015			December 31, 2014

The fair value of sale price	￦	12,376			46,476
Net assets disposed		(6,423	)		(12,323	)
Non-controlling interests		—			5,765
Realization of unrealized gain		—			534
Other comprehensive loss		(87	)		(20	)


Gain from disposals of subsidiaries	￦	5,866			40,432

(iv)

Net cashflow from sales of subsidiaries for six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won
	June 30, 2015		December 31, 2014

Consideration received in cash	￦	553		46,476
Less: Cash held by disposed subsidiaries		—		(2,187	)


Net cashflow	￦	553		44,289

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures

(1)

Investments in associates and joint ventures as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won
June 30, 2015
Investees	Key operation activities	Location	Percentage of ownership			Acquisition cost		Book value

<Associates>
Daegu Green Power Co., Ltd.	Power generation	KOREA		47.80	%	￦	76,193		73,704
Korea Gas Corporation (*1)	Importing and wholesaling LNG	KOREA		20.47	%		94,500		2,211,533
Korea Electric Power Industrial Development Co., Ltd.	Electricity metering	KOREA		29.00	%		4,727		18,842
YTN Co., Ltd.	Broadcasting	KOREA		21.43	%		59,000		40,030
Cheongna Energy Co., Ltd.	Generating and distributing vapor and hot/cold water	KOREA		43.90	%		49,607		23,872
Gangwon Wind Power Co., Ltd. (*2)	Wind power generation	KOREA		15.00	%		5,725		12,401
Hyundai Green Power Co., Ltd.	Power generation	KOREA		29.00	%		88,885		109,009
Korea Power Exchange (*6)	Management of power market	KOREA		100.00	%		127,839		213,605
AMEC Partners Korea (*3)	Resources development	KOREA		19.00	%		707		212
Hyundai Energy Co., Ltd. (*9)	Power generation	KOREA		29.00	%		71,070		31,822
Ecollite Co., Ltd.	Artificial light-weight aggregate	KOREA		36.10	%		1,516		—
Taebaek Wind Power Co., Ltd.	Power generation	KOREA		25.00	%		3,810		5,512
Muju Wind Power Co., Ltd.	Power generation	KOREA		25.00	%		2,850		2,704
Pyeongchang Wind Power Co., Ltd.	Power generation	KOREA		25.00	%		3,875		3,465
Daeryun Power Co., Ltd. (*3, 10)	Power generation	KOREA		13.13	%		25,477		39,487
JinanJangsu Wind Power Co., Ltd.	Power generation	KOREA		25.00	%		100		77
Changjuk Wind Power Co., Ltd.	Power generation	KOREA		30.00	%		3,801		6,577
KNH Solar Co., Ltd.	Power generation	KOREA		27.00	%		1,296		1,488
SPC Power Corporation	Power generation	PHILIPPINES		38.00	%		20,635		52,362
Gemeng International Energy Co., Ltd.	Power generation	CHINA		34.00	%		413,153		718,567
PT. Cirebon Electric Power	Power generation	INDONESIA		27.50	%		40,365		50,673
KNOC Nigerian East Oil Co., Ltd. (*4)	Resources development	NIGERIA		14.63	%		12		—
KNOC Nigerian West Oil Co., Ltd. (*4)	Resources development	NIGERIA		14.63	%		12		—
Dolphin Property Limited (*4)	Rental company	NIGERIA		15.00	%		12		53
PT Wampu Electric Power	Power generation	INDONESIA		46.00	%		20,452		16,331
PT. Bayan Resources TBK	Resources development	INDONESIA		20.00	%		615,860		531,521
S-Power Co., Ltd.	Power generation	KOREA		40.00	%		108,000		107,758
Pioneer Gas Power Limited (*8)	Power generation	INDIA		40.00	%		49,831		51,142
Eurasia Energy Holdings	Power generation and resources development	RUSSIA		40.00	%		461		—
Xe-Pian Xe-Namnoy Power Co., Ltd.	Power generation	LAOS		25.00	%		25,929		24,851
Busan Solar Co., Ltd. (*3)	Power generation	KOREA		19.80	%		793		613
Hadong Mineral Fiber Co., Ltd.	Recycling fly ashes	KOREA		25.00	%		50		—
Green Biomass Co., Ltd.	Power generation	KOREA		34.00	%		714		—
PT. Mutiara Jawa	Manufacturing and operating floating coal terminal	INDONESIA		29.00	%		2,978		—
Samcheok Eco Material Co., Ltd. (*3, 11)	Recycling fly ashes	KOREA		2.67	%		686		—
Noeul Green Energy Co., Ltd.	Power generation	KOREA		20.00	%		200		144
Naepo Green Energy Co., Ltd.	Power generation	KOREA		25.00	%		29,200		27,472
Goseong Green Energy Co., Ltd.	Power generation	KOREA		2.90	%		2,900		2,733
Gangneung Eco Power Co., Ltd.	Power generation	KOREA		6.04	%		2,900		2,680
Shin Pyeongtaek Power Co., Ltd.	Power generation	KOREA		40.00	%		40		—
Heang Bok Do Si Photovoltaic Power Co., Ltd.	Power generation	KOREA		28.00	%		194		172
DS POWER Co., Ltd. (*2)	Power generation	KOREA		10.91	%		17,900		14,453
Dongducheon Dream Power Co., Ltd.	Power generation	KOREA		33.61	%		107,958		103,667
KS Solar Corp. Ltd.(*3)	Power generation	KOREA		19.00	%		637		426
Yeongwol Energy Station Co., Ltd. (*2)	Power generation	KOREA		10.00	%		1,400		1,107
Jinbhuvish Power Generation Pvt. Ltd.(*2)	Power generation	INDIA		5.16	%		9,000		8,353
SE Green Energy Co., Ltd.	Power generation support	KOREA		47.76	%		3,821		3,601
Daegu Photovoltaic Co., Ltd.	Power generation	KOREA		29.00	%		1,230		1,848
Jeongam Wind Power Co., Ltd.	Power generation	KOREA		40.00	%		1,680		594
Korea Power Engineering Service Co., Ltd.	Construction and service	KOREA		29.00	%		290		1,366
Busan Green Energy Co., Ltd.	Power generation	KOREA		29.00	%		14,564		14,529
Jungbu Bio Energy Co., Ltd.(*2)	Power generation	KOREA		18.87	%		1,000		894


							2,115,835		4,532,250

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(1)

Investments in associates and joint ventures as of June 30, 2015 and December 31, 2014 are as follows, continued:


In millions of won
June 30, 2015
Investees	Key operation activities	Location	Percentage of ownership			Acquisition cost		Book value

<Joint ventures>
KEPCO-Uhde Inc. (*7)	Power generation	KOREA		66.00	%	￦	11,355		8,812
Eco Biomass Energy Sdn. Bhd. (*7)	Power generation	MALAYSIA		61.53	%		9,661		—
Datang Chaoyang Renewable Power Co., Ltd.	Power generation	CHINA		40.00	%		27,660		28,408
Shuweihat Asia Power Investment B.V.	Holding company	NETHERLANDS		49.00	%		60,191		16,913
Shuweihat Asia Operation & Maintenance Company (*7)	Maintenance of utility plant	CAYMAN		55.00	%		30		806
Waterbury Lake Uranium L.P.	Resources development	CANADA		40.00	%		26,602		21,646
ASM-BG Investicii AD	Power generation	BULGARIA		50.00	%		16,101		19,324
RES Technology AD	Power generation	BULGARIA		50.00	%		15,595		13,977
KV Holdings, Inc.	Power generation	PHILIPPINES		40.00	%		2,103		2,006
KEPCO SPC Power Corporation (*7)	Construction and operation of utility plant	PHILIPPINES		75.20	%		94,579		199,319
Canada Korea Uranium Limited Partnership (*5)	Resources development	CANADA		12.50	%		5,404		—
KEPCO Energy Resource Nigeria Limited	Holding company	NIGERIA		30.00	%		8,463		—
Gansu Datang Yumen Wind Power Co., Ltd.	Power generation	CHINA		40.00	%		16,621		17,365
Datang Chifeng Renewable Power Co., Ltd.	Power generation	CHINA		40.00	%		121,928		171,940
Datang KEPCO Chaoyang Renewable Power Co., Ltd.	Power generation	CHINA		40.00	%		10,858		10,473
Rabigh Electricity Company	Power generation	SAUDI ARABIA		40.00	%		109,743		28,643
Rabigh Operation & Maintenance Company	Maintenance of utility plant	SAUDI ARABIA		40.00	%		70		5,175
Jamaica Public Service Company Limited	Power generation	JAMAICA		40.00	%		301,910		232,031
KW Nuclear Components Co., Ltd.	R&D	KOREA		43.36	%		833		2,789
Busan Shinho Solar Power Co., Ltd.	Power generation	KOREA		25.00	%		2,100		3,538
GS Donghae Electric Power Co., Ltd.	Power generation	KOREA		34.00	%		204,000		200,931
Global Trade Of Power System Co., Ltd.	Exporting products and technology of small or medium business by proxy	KOREA		29.00	%		290		364
Expressway Solar-light Power Generation Co., Ltd.	Power generation	KOREA		29.00	%		1,856		2,035
KODE NOVUS 1 LLC.	Power generation	USA		50.00	%		19,213		10,063
KODE NOVUS 2 LLC.	Power generation	USA		49.00	%		12,498		7,368
Daejung Offshore Wind Power Co., Ltd.	Power generation	KOREA		49.90	%		4,990		3,550
Amman Asia Electric Power Company (*7)	Power generation	JORDAN		60.00	%		111,476		142,532
KEPCO-ALSTOM Power Electronics Systems, Inc. (*7)	R&D	KOREA		51.00	%		5,629		4,699
Dangjin Echo Power Co., Ltd.	Power generation	KOREA		40.00	%		60,000		56,513
Honam Wind Power Co., Ltd.	Power generation	KOREA		29.00	%		3,600		3,987
Nepal Water & Energy Development Company Pty Ltd. (*7)	Construction and operation of utility plant	NEPAL		58.59	%		18,568		17,092
Chun-cheon Energy Co., Ltd.	Power generation	KOREA		29.90	%		26,888		26,332
Yeonggwangbaeksu Wind Power Co., Ltd. (*3)	Power generation	KOREA		15.00	%		3,000		2,780
Nghi Son 2 Power Ltd.	Power generation	VIETNAM		50.00	%		838		329
Kelar S.A (*7)	Power generation	CHILE		65.00	%		4,180		—
PT. Tanjung Power Indonesia	Power generation	INDONESIA		35.00	%		746		745
Incheon New Power Co., Ltd.	Power generation	KOREA		29.00	%		461		517
Seokmun Energy Co., Ltd.	Integrated energy business	KOREA		34.00	%		680		—


							1,320,720		1,263,002


						￦	3,436,555		5,795,252

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(1)

Investments in associates and joint ventures as of June 30, 2015 and December 31, 2014 are as follows, continued:

(*1)	The effective percentage of ownership is 21.57% considering treasury stocks.

(*2)	The Company can exercise significant influence by virtue of its contractual right to appoint directors to the board of directors of the entity, and by strict decision criteria of the Company’s financial and operating policy of the board of directors.

(*3)	The Company can exercise significant influence by virtue of its contractual right to appoint a director to the board of directors of the entity.

(*4)	The Company can exercise significant influence by virtue of its contractual right to appoint one out of four members of the steering committee of the entity. Moreover, the Company has significant financial transactions, which can affect its influence on the entity.

(*5)	The Company has joint control over the entity by virtue of its contractual right to appoint directors to the board of directors of the entity, and by strict decision criteria of the Company’s financial and operating policy of the board of directors.

(*6)

The Government regulates the Company’s ability to make operating and financial decisions over the entity, as the Government requires maintaining arms-length transactions between KPX and the Company’s other subsidiaries. The Company can exercise significant influence by its right to nominate directors to the board of directors of the entity.

(*7)	According to the shareholders’ agreement, all critical financial and operating decisions must be agreed to by all ownership parties. For these reasons, the entities are classified as joint ventures.

(*8)	As of reporting date, the reporting period of all associates and joint ventures ends in December 31, except for Pioneer Gas Power Limited whose reporting period ends on March 31.

(*9)

As of June 30, 2015, 17.3% of ownership of Hyundai Energy Co., Ltd. is held by NH Power ll Co., Ltd. and NH Bank. According to the shareholders’ agreement reached on March 2011, not only does the Company have a call option to acquire the investment in Hyundai Energy Co., Ltd. from NH Power ll Co., Ltd. and NH Bank with a certain rate of return, NH Power ll Co., Ltd. and NH Bank also have put options to dispose of their investment to the Company. In connection with this agreement, the Company applied the equity method on the investment in Hyundai Energy Co., Ltd. with 46.3% of ownership.

(*10)

The Company’s percentage of ownership has decreased due to the acquisition of Daeryun Power Co., Ltd. and the effective percentage of ownership is 19.45% considering stock purchase options.

(*11)

The Company’s effective percentage of ownership excluding the redeemable convertible preferred stock is 25.54%.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, continued

(1)

Investments in associates and joint ventures as of June 30, 2015 and December 31, 2014 are as follows, continued:


In millions of won
December 31, 2014
Investees	Key operation activities	Location	Percentage of ownership			Acquisition cost		Book value

<Associates>
Daegu Green Power Co., Ltd.	Power generation	KOREA		47.80	%	￦	76,193		71,387
Korea Gas Corporation (*1)	Importing and wholesaling LNG	KOREA		20.47	%		94,500		2,097,539
Korea Electric Power Industrial Development Co., Ltd.	Electricity metering	KOREA		29.00	%		4,727		21,622
YTN Co., Ltd.	Broadcasting	KOREA		21.43	%		59,000		39,889
Cheongna Energy Co., Ltd.	Generating and distributing vapor and hot/cold water	KOREA		43.90	%		49,607		28,771
Gangwon Wind Power Co., Ltd. (*2)	Wind power generation	KOREA		15.00	%		5,725		12,385
Hyundai Green Power Co., Ltd.	Power generation	KOREA		29.00	%		88,885		113,033
Korea Power Exchange (*6)	Management of power market	KOREA		100.00	%		127,839		198,021
AMEC Partners Korea (*3)	Resources development	KOREA		19.00	%		707		200
Hyundai Energy Co., Ltd. (*9)	Power generation	KOREA		29.00	%		71,070		35,925
Ecollite Co., Ltd.	Artificial light-weight aggregate	KOREA		36.10	%		1,516		—
Taebaek Wind Power Co., Ltd.	Power generation	KOREA		25.00	%		3,810		5,525
Muju Wind Power Co., Ltd.	Power generation	KOREA		25.00	%		2,850		2,706
Pyeongchang Wind Power Co., Ltd.	Power generation	KOREA		25.00	%		3,875		3,693
Daeryun Power Co., Ltd. (*3, 10)	Power generation	KOREA		13.13	%		25,477		41,951
JinanJangsu Wind Power Co., Ltd.	Power generation	KOREA		25.00	%		100		77
Changjuk Wind Power Co., Ltd.	Power generation	KOREA		30.00	%		3,801		6,486
KNH Solar Co., Ltd.	Power generation	KOREA		27.00	%		1,296		1,744
SPC Power Corporation	Power generation	PHILIPPINES		38.00	%		20,635		47,799
Gemeng International Energy Co., Ltd.	Power generation	CHINA		34.00	%		413,153		667,578

PT. Cirebon Electric Power	Power generation	INDONESIA		27.50	%		40,365		43,335
KNOC Nigerian East Oil Co., Ltd. (*4)	Resources development	NIGERIA		14.63	%		12		—

KNOC Nigerian West Oil Co., Ltd. (*4)	Resources development	NIGERIA		14.63	%		12		—
Dolphin Property Limited (*4)	Rental company	NIGERIA		15.00	%		12		61
PT Wampu Electric Power	Power generation	INDONESIA		46.00	%		18,935		16,071
PT. Bayan Resources TBK	Resources development	INDONESIA		20.00	%		615,860		540,011
S-Power Co., Ltd.	Power generation	KOREA		40.00	%		108,000		104,244
Pioneer Gas Power Limited (*8)	Power generation	INDIA		40.00	%		49,831		50,668
Eurasia Energy Holdings	Power generation and resources development	RUSSIA		40.00	%		461		—
Xe-Pian Xe-Namnoy Power Co., Ltd.	Power generation	LAOS		25.00	%		23,473		22,152
Busan Solar Co., Ltd. (*3)	Power generation	KOREA		19.80	%		793		853
Hadong Mineral Fiber Co., Ltd.	Recycling fly ashes	KOREA		25.00	%		50		3
Green Biomass Co., Ltd.	Power generation	KOREA		34.00	%		714		—
PT. Mutiara Jawa	Manufacturing and operating floating coal terminal	INDONESIA		29.00	%		2,978		818
Samcheok Eco Material Co., Ltd. (*3, 11)	Recycling fly ashes	KOREA		2.67	%		686		212
Noeul Green Energy Co., Ltd.	Power generation	KOREA		20.00	%		200		189
Naepo Green Energy Co., Ltd.	Power generation	KOREA		25.00	%		29,200		28,064
Goseong Green Energy Co., Ltd.	Power generation	KOREA		9.67	%		2,900		2,586
Gangneung Eco Power Co., Ltd.	Power generation	KOREA		6.04	%		2,900		2,783
Shin Pyeongtaek Power Co., Ltd.	Power generation	KOREA		40.00	%		40		—
Heang Bok Do Si Photovoltaic Power Co., Ltd.	Power generation	KOREA		28.00	%		194		221
DS POWER Co., Ltd. (*2)	Power generation	KOREA		10.91	%		17,900		15,642
Dongducheon Dream Power Co., Ltd.	Power generation	KOREA		33.61	%		107,958		100,545
KS Solar Corp. Ltd.(*3)	Power generation	KOREA		19.00	%		637		325
Yeongwol Energy Station Co., Ltd. (*2)	Power generation	KOREA		10.00	%		1,400		1,741
Jinbhuvish Power Generation Pvt. Ltd. (*2)	Power generation	INDIA		5.16	%		9,000		8,344
SE Green Energy Co., Ltd.	Power generation support	KOREA		47.76	%		3,821		3,623
Daegu Photovoltaic Co., Ltd.	Power generation	KOREA		29.00	%		1,230		1,581
Jeongam Wind Power Co., Ltd.	Power generation	KOREA		40.00	%		800		93
Korea Power Engineering Service Co., Ltd.	Construction and service	KOREA		29.00	%		290		1,334


							2,095,418		4,341,830

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, continued

(1)

Investments in associates and joint ventures as of June 30, 2015 and December 31, 2014 are as follows, continued:


In millions of won
December 31, 2014
Investees	Key operation activities	Location	Percentage of ownership			Acquisition cost		Book value

<Joint ventures>
KEPCO-Uhde Inc. (*7)	Power generation	KOREA		66.00	%	￦	11,355		9,042
Eco Biomass Energy Sdn. Bhd. (*7)	Power generation	MALAYSIA		61.53	%		9,661		—
Datang Chaoyang Renewable Power Co., Ltd.	Power generation	CHINA		40.00	%		27,660		27,514
Shuweihat Asia Power Investment B.V.	Holding company	NETHERLANDS		49.00	%		60,083		16,241
Shuweihat Asia Operation & Maintenance Company (*7)	Maintenance of utility plant	CAYMAN		55.00	%		30		345
Waterbury Lake Uranium L.P.	Resources development	CANADA		40.00	%		26,602		22,010
ASM-BG Investicii AD	Power generation	BULGARIA		50.00	%		16,101		19,608
RES Technology AD	Power generation	BULGARIA		50.00	%		15,595		14,725
KV Holdings, Inc.	Power generation	PHILIPPINES		40.00	%		2,103		1,902
KEPCO SPC Power Corporation (*7)	Construction and operation of utility plant	PHILIPPINES		75.20	%		94,579		190,519
Canada Korea Uranium Limited Partnership (*5)	Resources development	CANADA		12.50	%		5,404		—
KEPCO Energy Resource Nigeria Limited	Holding company	NIGERIA		30.00	%		8,463		—
Gansu Datang Yumen Wind Power Co., Ltd.	Power generation	CHINA		40.00	%		16,621		17,467
Datang Chifeng Renewable Power Co., Ltd.	Power generation	CHINA		40.00	%		121,928		169,496
Datang KEPCO Chaoyang Renewable Power Co., Ltd.	Power generation	CHINA		40.00	%		10,858		10,539
Rabigh Electricity Company	Power generation	SAUDI ARABIA		40.00	%		109,743		8,121
Rabigh Operation & Maintenance Company	Maintenance of utility plant	SAUDI ARABIA		40.00	%		70		4,628
Jamaica Public Service Company Limited	Power generation	JAMAICA		40.00	%		301,910		226,892
KW Nuclear Components Co., Ltd.	R&D	KOREA		43.36	%		833		2,899
Busan Shinho Solar Power Co., Ltd.	Power generation	KOREA		25.00	%		2,100		3,284
GS Donghae Electric Power Co., Ltd.	Power generation	KOREA		34.00	%		204,000		201,409
Global Trade Of Power System Co., Ltd.	Exporting products and technology of small or medium business by proxy	KOREA		29.00	%		290		343
Expressway Solar-light Power Generation Co., Ltd.	Power generation	KOREA		29.00	%		1,856		2,087
KODE NOVUS 1 LLC.	Power generation	USA		50.00	%		19,213		12,207
KODE NOVUS 2 LLC.	Power generation	USA		49.00	%		12,498		8,248
Daejung Offshore Wind Power Co., Ltd.	Power generation	KOREA		49.90	%		4,990		3,711
Amman Asia Electric Power Company (*7)	Power generation	JORDAN		60.00	%		111,476		122,391
KEPCO-ALSTOM Power Electronics Systems, Inc. (*7)	R&D	KOREA		51.00	%		5,629		4,617
Dangjin Echo Power Co., Ltd.	Power generation	KOREA		33.10	%		40,000		37,837
Honam Wind Power Co., Ltd.	Power generation	KOREA		29.00	%		3,600		3,555
Nepal Water & Energy Development Company Pty Ltd. (*7)	Construction and operation of utility plant	NEPAL		59.61	%		18,568		17,872
Chun-cheon Energy Co., Ltd.	Power generation	KOREA		29.90	%		15		—
Yeonggwangbaeksu Wind Power Co., Ltd. (*3)	Power generation	KOREA		15.00	%		3,000		2,962
Nghi Son 2 Power Ltd.	Power generation	VIETNAM		50.00	%		350		103
Kelar S.A (*7)	Power generation	CHILE		65.00	%		4,180		3,156
PT. Tanjung Power Indonesia	Power generation	INDONESIA		35.00	%		746		699
Incheon New Power Co., Ltd.	Power generation	KOREA		29.00	%		461		465
Seokmun Energy Co., Ltd.	Integrated energy business	KOREA		34.00	%		680		—


							1,273,251		1,166,894


						￦	3,368,669		5,508,727

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, continued

(1)

Investments in associates and joint ventures as of June 30, 2015 and December 31, 2014 are as follows, continued:

(*1)	The effective percentage of ownership is 21.57% considering treasury stocks.

(*2)	The Company can exercise significant influence by virtue of its contractual right to appoint directors to the board of directors of the entity, and by strict decision criteria of the Company’s financial and operating policy of the board of directors.

(*3)	The Company can exercise significant influence by virtue of its contractual right to appoint a director to the board of directors of the entity.

(*4)	The Company can exercise significant influence by virtue of its contractual right to appoint one out of four members of the steering committee of the entity. Moreover, the Company has significant financial transactions, which can affect its influence on the entity.

(*5)	The Company has joint control over the associates by virtue of its contractual right to appoint directors to the board of directors of the entity, and by strict decision criteria of the Company’s financial and operating policy of the board of directors.

(*6)

(*7)	According to the shareholders’ agreement, all critical financial and operating decisions must be agreed to by all ownership parties. For these reasons, the entities are classified as joint ventures.

(*8)	As of reporting date, the reporting period of all associates and joint ventures ends in December 31, except for Pioneer Gas Power Limited whose reporting period ends on March 31.

(*9)

As of December 31, 2014, 17.3% of ownership of Hyundai Energy Co., Ltd. is held by NH Power ll Co., Ltd. and NH Bank. According to the shareholders’ agreement reached on March 2011, not only does the Company have a call option to acquire the investment in Hyundai Energy Co., Ltd. from NH Power ll Co., Ltd. and NH Bank with a certain rate of return, NH Power ll Co., Ltd. and NH Bank also have put options to dispose of their investment to the Company. In connection with this agreement, the Company applied the equity method on the investment in Hyundai Energy Co., Ltd. with 46.3% of ownership.

(*10)

The Company’s percentage of ownership has decreased due to the acquisitions of Daeryun Power Co., Ltd. and the effective percentage of ownership is 19.45% considering stock purchase options.

(*11)

The Company’s effective percentage of ownership excluding the redeemable convertible preferred stock is 25.54%.

(2)

The fair value of associates which are actively traded on the open market and have a readily available market value as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won
Investees	June 30, 2015		December 31, 2014

<Associates>
Korea Electric Power Industrial Development Co., Ltd.	￦	42,921		60,506
Korea Gas Corporation		816,480		936,495
YTN Co., Ltd.		24,210		23,940
SPC Power Corporation		70,429		65,888
PT. Bayan Resources TBK		450,470		391,463

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(3)

Changes in investments in associates and joint ventures for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won
June 30, 2015
Investees	Beginning balance		Acquisition		Disposal		Dividends received			Share of income (loss)			Other comprehensive income (loss)			Others			Ending balance

<Associates>
Daegu Green Power Co., Ltd.	￦	71,387		—		—		—			2,317			—			—			73,704
Korea Gas Corporation		2,097,539		—		—		(4,725	)		116,195			1,900			624			2,211,533
Korea Electric Power Industrial Development Co., Ltd.		21,622		—		—		(1,267	)		(1,938	)		—			425			18,842
YTN Co., Ltd.		39,889		—		—		(90	)		246			(185	)		170			40,030
Cheongna Energy Co., Ltd.		28,771		—		—		—			(4,899	)		—			—			23,872
Gangwon Wind Power Co., Ltd.		12,385		—		—		(852	)		852			16			—			12,401
Hyundai Green Power Co., Ltd.		113,033		—		—		(8,889	)		4,865			—			—			109,009
Korea Power Exchange		198,021		—		—		—			14,694			—			890			213,605
AMEC Partners Korea		200		—		—		—			12			—			—			212
Hyundai Energy Co., Ltd.		35,925		—		—		—			(4,103	)		—			—			31,822
Ecollite Co., Ltd.		—		—		—		—			—			—			—			—
Taebaek Wind Power Co., Ltd.		5,525		—		—		—			(13	)		—			—			5,512
Muju Wind Power Co., Ltd.		2,706		—		—		—			(2	)		—			—			2,704
Pyeongchang Wind Power Co., Ltd.		3,693		—		—		—			(228	)		—			—			3,465
Daeryun Power Co., Ltd.		41,951		—		—		—			(2,464	)		—			—			39,487
JinanJangsu Wind Power Co., Ltd.		77		—		—		—			—			—			—			77
Changjuk Wind Power Co., Ltd.		6,486		—		—		—			91			—			—			6,577
KNH Solar Co., Ltd.		1,744		—		—		—			(258	)		2			—			1,488
SPC Power Corporation		47,799		—		—		(1,349	)		2,723			321			2,868			52,362
Gemeng International Energy Co., Ltd.		667,578		—		—		—			33,496			17,493			—			718,567
PT. Cirebon Electric Power		43,335		—		—		—			5,410			1,928			—			50,673
KNOC Nigerian East Oil Co., Ltd.		—		—		—		—			(546	)		(221	)		767			—
KNOC Nigerian West Oil Co., Ltd.		—		—		—		—			(513	)		(203	)		716			—
Dolphin Property Limited		61		—		—		—			(5	)		(3	)		—			53
PT Wampu Electric Power		16,071		1,517		—		—			(1,618	)		351			10			16,331
PT. Bayan Resources TBK		540,011		—		—		—			(3,595	)		(4,895	)		—			531,521
S-Power Co., Ltd.		104,244		—		—		—			3,514			—			—			107,758
Pioneer Gas Power Limited		50,668		—		—		—			(1	)		475			—			51,142
Eurasia Energy Holdings		—		—		—		—			—			—			—			—
Xe-Pian Xe-Namnoy Power Co., Ltd.		22,152		2,456		—		—			(63	)		306			—			24,851
Busan Solar Co., Ltd.		853		—		—		—			(240	)		—			—			613
Hadong Mineral Fiber Co., Ltd.		3		—		—		—			(3	)		—			—			—
Green Biomass Co., Ltd.		—		—		—		—			—			—			—			—
PT. Mutiara Jawa		818		—		—		—			(818	)		—			—			—
Samcheok Eco Material Co., Ltd.		212		—		—		—			(178	)		(34	)		—			—
Noeul Green Energy Co., Ltd.		189		—		—		—			(45	)		—			—			144
Naepo Green Energy Co., Ltd.		28,064		—		—		—			(592	)		—			—			27,472
Goseong Green Energy Co. Ltd.		2,586		—		—		—			147			—			—			2,733
Gangneung Eco Power Co., Ltd.		2,783		—		—		—			(103	)		—			—			2,680
Shin Pyeongtaek Power Co., Ltd.		—		—		—		—			—			—			—			—
Heang Bok Do Si Photovoltaic Power Co., Ltd.		221		—		—		—			(49	)		—			—			172
DS POWER Co., Ltd.		15,642		—		—		—			(1,178	)		—			(11	)		14,453
Dongducheon Dream Power Co., Ltd.		100,545		—		—		—			3,239			—			(117	)		103,667
KS Solar Corp. Ltd.		325		—		—		—			101			—			—			426
Yeongwol Energy Station Co., Ltd.		1,741		—		—		—			(634	)		—			—			1,107

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(3)

Changes in investments in associates and joint ventures for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows, continued:


In millions of won
June 30, 2015
Investees	Beginning balance		Acquisition		Disposal		Dividends received			Share of income (loss)			Other comprehensive income (loss)			Others			Ending balance

Jinbhuvish Power Generation Pvt. Ltd.	￦	8,344		—		—		—			(41	)		50			—			8,353
SE Green Energy Co., Ltd.		3,623		—		—		—			(22	)		—			—			3,601
Daegu Photovoltaic Co., Ltd.		1,581		—		—		—			267			—			—			1,848
Jeongam Wind Power Co., Ltd.		93		880		—		—			(379	)		—			—			594
Korea Power Engineering Service Co., Ltd.		1,334		—		—		(44	)		76			—			—			1,366
Busan Green Energy Co., Ltd.		—		14,564		—		—			(35	)		—			—			14,529
Jungbu Bio Energy Co., Ltd.		—		1,000		—		—			(106	)		—			—			894


		4,341,830		20,417		—		(17,216	)		163,576			17,301			6,342			4,532,250


<Joint ventures>
KEPCO-Uhde Inc.		9,042		—		—		—			(230	)		—			—			8,812
Eco Biomass Energy Sdn. Bhd.		—		—		—		—			—			—			—			—
Datang Chaoyang Renewable Power Co., Ltd.		27,514		—		—		—			222			672			—			28,408
Shuweihat Asia Power Investment B.V.		16,241		108		—		—			136			428			—			16,913
Shuweihat Asia Operation & Maintenance Company		345		—		—		—			443			18			—			806
Waterbury Lake Uranium L.P.		22,010		—		—		—			—			(411	)		47			21,646
ASM-BG Investicii AD		19,608		—		—		—			802			(1,086	)		—			19,324
RES Technology AD		14,725		—		—		—			81			(829	)		—			13,977
KV Holdings, Inc.		1,902		—		—		—			74			30			—			2,006
KEPCO SPC Power Corporation		190,519		—		—		(11,432	)		20,220			2,908			(2,896	)		199,319
Canada Korea Uranium Limited Partnership		—		—		—		—			—			—			—			—
KEPCO Energy Resource Nigeria Limited		—		—		—		—			—			—			—			—
Gansu Datang Yumen Wind Power Co., Ltd.		17,467		—		—		—			(520	)		418			—			17,365
Datang Chifeng Renewable Power Co., Ltd.		169,496		—		—		(8,239	)		6,620			4,066			(3	)		171,940
Datang KEPCO Chaoyang Renewable Power Co., Ltd.		10,539		—		—		—			(296	)		230			—			10,473
Rabigh Electricity Company		8,121		—		—		—			14,567			5,968			(13	)		28,643
Rabigh Operation & Maintenance Company		4,628		—		—		—			444			103			—			5,175
Jamaica Public Service Company Limited		226,892		—		—		—			—			—			5,139			232,031
KW Nuclear Components Co., Ltd.		2,899		—		—		(1,016	)		833			—			73			2,789
Busan Shinho Solar Power Co., Ltd.		3,284		—		—		—			254			—			—			3,538
GS Donghae Electric Power Co., Ltd.		201,409		—		—		—			(478	)		—			—			200,931
Global Trade Of Power System Co., Ltd.		343		—		—		—			21			—			—			364
Expressway Solar-light Power Generation Co., Ltd.		2,087		—		—		—			(52	)		—			—			2,035
KODE NOVUS 1 LLC.		12,207		—		—		—			(2,262	)		118			—			10,063
KODE NOVUS 2 LLC.		8,248		—		—		—			(1,043	)		163			—			7,368
Daejung Offshore Wind Power Co., Ltd.		3,711		—		—		—			(161	)		—			—			3,550
Amman Asia Electric Power Company		122,391		—		—		—			12,676			8,049			(584	)		142,532
KEPCO-ALSTOM Power Electronics Systems, Inc.		4,617		—		—		—			82			—			—			4,699
Dangjin Echo Power Co., Ltd.		37,837		20,000		—		—			(1,231	)		(59	)		(34	)		56,513
Honam Wind Power Co., Ltd.		3,555		—		—		—			432			—			—			3,987
Nepal Water & Energy Development Company Pty Ltd.		17,872		—		—		—			(1,289	)		509			—			17,092
Chun-cheon Energy Co., Ltd.		—		26,873		—		—			(412	)		(129	)		—			26,332
Yeonggwangbaeksu Wind Power Co., Ltd.		2,962		—		—		—			(182	)		—			—			2,780
Nghi Son 2 Power Ltd.		102		488		—		—			(268	)		23			(16	)		329

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(3)

Changes in investments in associates and joint ventures for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows, continued:


In millions of won
June 30, 2015
Investees	Beginning balance		Acquisition		Disposal		Dividends received			Share of income (loss)		Other comprehensive income (loss)			Others			Ending balance

Kelar S.A	￦	3,156		—		—		—			—		(407	)		(2,749	)		—
PT. Tanjung Power Indonesia		700		—		—		—			55		—			(10	)		745
Incheon New Power Co., Ltd.		465		—		—		—			52		—			—			517
Seokmun Energy Co., Ltd.		—		—		—		—			—		—			—			—

		1,166,894		47,469		—		(20,687	)		49,590		20,782			(1,046	)		1,263,002


	￦	5,508,724		67,886		—		(37,903	)		213,166		38,083			5,296			5,795,252


In millions of won
December 31, 2014
Investees	Beginning balance		Acquisition		Disposal			Dividends received			Share of income (loss)			Other comprehensive income (loss)			Others			Ending balance

<Associates>
Daegu Green Power Co., Ltd.	￦	74,878		—		—			—			(3,494	)		3			—			71,387
Korea Gas Corporation		1,926,800		—		—			—			96,457			69,489			4,793			2,097,539
Korea Electric Power Industrial Development Co., Ltd.		22,450		—		—			(1,872	)		2,275			—			(1,231	)		21,622
YTN Co., Ltd.		38,426		—		—			(90	)		2,423			(26	)		(844	)		39,889
Cheongna Energy Co., Ltd.		28,114		5,707		—			—			(5,023	)		(27	)		—			28,771
Gangwon Wind Power Co., Ltd.		13,185		—		—			(1,988	)		1,155			33			—			12,385
Hyundai Green Power Co., Ltd.		110,157		—		—			(8,889	)		11,764			—			1			113,033
Korea Power Exchange		189,544		—		—			—			13,274			—			(4,797	)		198,021
AMEC Partners Korea		189		—		—			—			11			—			—			200
Hyundai Energy Co., Ltd.		43,386		—		—			—			(7,461	)		—			—			35,925
Ecollite Co., Ltd.		—		—		—			—			—			—			—			—
Taebaek Wind Power Co., Ltd.		5,553		—		—			(991	)		963			—			—			5,525
Alternergy Philippine Investments Corporation		1,500		—		(1,497	)		—			(7	)		228			(224	)		—
Muju Wind Power Co., Ltd.		2,707		—		—			—			—			—			(1	)		2,706
Pyeongchang Wind Power Co., Ltd.		600		3,238		—			—			(128	)		(17	)		—			3,693
Daeryun Power Co., Ltd.		24,599		—		—			—			(1,748	)		—			19,100			41,951
JinanJangsu Wind Power Co., Ltd.		77		—		—			—			—			—			—			77
Changjuk Wind Power Co., Ltd.		6,344		—		—			(1,292	)		1,434			—			—			6,486
KNH Solar Co., Ltd.		1,372		—		—			—			372			—			—			1,744
SPC Power Corporation		47,661		—		—			—			(1,800	)		335			1,603			47,799
Gemeng International Energy Co., Ltd.		608,674		—		—			(6,905	)		54,368			11,441			—			667,578
PT. Cirebon Electric Power		32,826		1,148		—			—			6,303			3,058			—			43,335
KNOC Nigerian East Oil Co., Ltd.		—		—		—			—			—			—			—			—
KNOC Nigerian West Oil Co., Ltd.		—		—		—			—			—			—			—			—
Dolphin Property Limited		—		—		—			—			184			(8	)		(115	)		61
E-Power S.A.		5,284		—		(5,041	)		(1,431	)		1,173			15			—			—
PT Wampu Electric Power		15,121		—		—			—			308			642			—			16,071

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(3)

Changes in investments in associates and joint for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows, continued:


In millions of won
December 31, 2014
Investees	Beginning balance		Acquisition		Disposal			Dividends received			Share of income (loss)			Other comprehensive income (loss)			Others			Ending balance

PT. Bayan Resources TBK	￦	579,534		—		—			—			(30,565	)		(8,958	)		—			540,011
S-Power Co., Ltd.		107,264		—		—			—			(3,020	)		—			—			104,244
Pioneer Gas Power Limited		43,666		1,122		—			—			298			5,582			—			50,668
Eurasia Energy Holdings		—		—		—			—			—			—			—			—
Xe-Pian Xe-Namnoy Power Co., Ltd.		18,058		4,546		—			—			(915	)		753			(290	)		22,152
Busan Solar Co., Ltd.		741		—		—			—			112			—			—			853
Hadong Mineral Fiber Co., Ltd.		3		—		—			—			—			—			—			3
Green Biomass Co., Ltd.		171		—		—			—			(171	)		—			—			—
Gumi-ochang Photovoltaic Power Co., Ltd.		389		—		(399	)		(14	)		24			—			—			—
Chungbuk Photovoltaic Power Co., Ltd.		184		—		(192	)		—			8			—			—			—
Cheonan Photovoltaic Power Co., Ltd.		148		—		(138	)		—			(10	)		—			—			—
PT. Mutiara Jawa		1,666		—		—			—			(885	)		37			—			818
Samcheok Eco Material Co., Ltd.		—		686		—			—			(474	)		—			—			212
Noeul Green Energy Co., Ltd.		—		200		—			—			(11	)		—			—			189
Naepo Green Energy Co., Ltd.		—		29,200		—			—			(995	)		(141	)		—			28,064
Goseong Green Energy Co., Ltd.		—		2,900		—			—			(311	)		—			(3	)		2,586
Gangneung Eco Power Co., Ltd.		—		2,900		—			—			(117	)		—			—			2,783
Shin Pyeongtaek Power Co., Ltd.		—		40		—			—			(40	)		—			—			—
Hyundai Asan Solar Power Co., Ltd.		462		—		(430	)		—			(32	)		—			—			—
Heang Bok Do Si Photovoltaic Power Co., Ltd.		91		101		—			—			31			(2	)		—			221
Jeonnam Solar Co., Ltd.		696		—		(941	)		—			241			4			—			—
DS POWER Co., Ltd.		17,900		—		—			—			(2,258	)		—			—			15,642
D Solar Energy Co., Ltd.		364		—		(418	)		—			54			—			—			—
Dongducheon Dream Power Co., Ltd.		134,398		—		(29,782	)		—			(4,071	)		—			—			100,545
KS Solar Corp. Ltd.		537		—		—			—			(202	)		(10	)		—			325
KOSCON Photovoltaic Co., Ltd.		315		—		(351	)		—			36			—			—			—
Yeongwol Energy Station Co., Ltd.		908		—		(410	)		—			1,239			3			1			1,741
Yeonan Photovoltaic Co., Ltd.		123		—		(128	)		—			5			—			—			—
Q1 Solar Co., Ltd.		983		—		(1,123	)		—			140			—			—			—
Jinbhuvish Power Generation Pvt. Ltd.		8,495		—		—			—			(197	)		46			—			8,344
Best Solar Energy Co., Ltd.		898		—		(1,242	)		—			344			—			—			—
Seokcheon Solar Power Co., Ltd.		1,046		—		(1,041	)		(49	)		48			1			(5	)		—
SE Green Energy Co., Ltd.		3,745		—		—			—			(122	)		—			—			3,623
Daegu Photovoltaic Co., Ltd.		1,334		—		—			—			247			—			—			1,581
Jeongam Wind Power Co., Ltd.		324		—		—			—			(231	)		—			—			93
Korea Power Engineering Service Co., Ltd.		585		—		—			—			787			—			(38	)		1,334
Golden Route J Solar Power Co., Ltd.		99		—		(75	)		—			(24	)		—			—			—


		4,124,574		51,788		(43,208	)		(23,521	)		131,766			82,481			17,950			4,341,830


<Joint ventures>
KEPCO-Uhde Inc.		9,537		—		—			—			(493	)		—			(2	)		9,042
Eco Biomass Energy Sdn. Bhd.		—		—		—			—			—			—			—			—
Datang Chaoyang Renewable Power Co., Ltd.		28,161		—		—			(740	)		(346	)		439			—			27,514
Shuweihat Asia Power Investment B.V.		64		59,576		—			—			6,077			(49,428	)		(48	)		16,241
Shuweihat Asia Operation & Maintenance Company		29		—		—			(869	)		1,172			14			(1	)		345
Waterbury Lake Uranium L.P.		23,042		762		—			—			—			1,285			(3,079	)		22,010
ASM-BG Investicii AD		20,088		—		—			—			1,131			(1,611	)		—			19,608
RES Technology AD		16,045		—		—			—			(78	)		(1,242	)		—			14,725
KV Holdings, Inc.		1,842		—		—			—			—			60			—			1,902
KEPCO SPC Power Corporation		143,294		—		—			(8,069	)		48,623			6,640			31			190,519

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(3)

Changes in investments in associates and joint ventures for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows, continued:


In millions of won
December 31, 2014
Investees	Beginning balance		Acquisition		Disposal			Dividends received			Share of income (loss)			Other comprehensive income (loss)			Others			Ending balance
Canada Korea Uranium Limited Partnership	￦	—		—		—			—			—			—			—			—
KEPCO Energy Resource Nigeria Limited		2,202		—		—			—			(2,190	)		(12	)		—			—
Gansu Datang Yumen Wind Power Co., Ltd.		19,237		—		—			—			(2,012	)		242			—			17,467
Datang Chifeng Renewable Power Co., Ltd.		166,330		—		—			(8,951	)		9,144			2,973			—			169,496
Datang KEPCO Chaoyang Renewable Power Co., Ltd.		10,604		—		—			(788	)		531			192			—			10,539
Rabigh Electricity Company		—		—		—			—			25,040			(18,709	)		1,790			8,121
Rabigh Operation & Maintenance Company		4,082		—		—			(2,546	)		2,945			147			—			4,628
Jamaica Public Service Company Limited (*)		268,022		—		—			—			—			—			(41,130	)		226,892
KW Nuclear Components Co., Ltd.		2,476		—		—			(1,399	)		1,821			—			1			2,899
Busan Shinho Solar Power Co., Ltd.		2,871		—		—			—			423			(10	)		—			3,284
GS Donghae Electric Power Co., Ltd.		173,915		117,600		(88,962	)		—			(580	)		(161	)		(403	)		201,409
YEONGAM Wind Power Co., Ltd.		11,424		—		(12,533	)		—			1,109			—			—			—
Global Trade Of Power System Co., Ltd		249		—		—			—			94			—			—			343
Expressway Solar-light Power Generation Co., Ltd.		1,863		—		(1,276	)		(237	)		1,737			—			—			2,087
KODE NOVUS 1 LLC.		14,237		—		—			—			(2,324	)		294			—			12,207
KODE NOVUS 2 LLC.		9,510		—		—			—			(1,592	)		330			—			8,248
Daejung Offshore Wind Power Co., Ltd.		4,135		—		—			—			(424	)		—			—			3,711
Amman Asia Electric Power Company		111,315		6,755		—			—			23,324			(19,003	)		—			122,391
KEPCO-ALSTOM Power Electronics Systems, Inc.		4,758		—		—			—			(141	)		—			—			4,617
Dangjin Echo Power Co., Ltd.		39,102		—		—			—			(1,235	)		(35	)		5			37,837
Honam Wind Power Co., Ltd.		1,933		—		—			—			248			1,254			120			3,555
Nepal Water & Energy Development Company Pty Ltd.		10,409		8,018		—			—			(928	)		373			—			17,872
Chun-cheon Energy Co., Ltd.		—		15		—			—			(15	)		—			—			—
Yeonggwangbaeksu Wind Power Co., Ltd.		—		3,000		—			—			(33	)		—			(5	)		2,962
Nghi Son 2 Power Ltd.		—		350		—			—			(268	)		(14	)		34			102
Kelar S.A		4,180		—		—			—			(1,047	)		407			(384	)		3,156
PT. Tanjung Power Indonesia		361		359		—			—			(60	)		39			1			700
Incheon New Power Co., Ltd.		449		—		—			—			9			—			7			465
Seokmun Energy Co., Ltd.		415		—		—			—			(415	)		—			—			—

		1,106,181		196,435		(102,771	)		(23,599	)		109,247			(75,536	)		(43,063	)		1,166,894


	￦	5,230,755		248,223		(145,979	)		(47,120	)		241,013			6,945			(25,113	)		5,508,724

(*)

It has been determined that there is objective evidence of impairment as a result of one or more events including that a financial institution granted Jamaica Public Service Company Limited (“JPS”) a concession that the financial institution would not otherwise consider. As of December 31, 2014, as a result of the impairment test, the recoverable amount of JPS is less than its carrying amount and an impairment loss of ￦52,279 million is recognized in profit or loss. The recoverable amount of JPS is its value in use which is calculated based on the most recent financial budget of future cash flow for a period of 10 years approved by management and the discount rate used to calculate the value in use is 10.15%.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(4)

Summary of financial information of associates and joint ventures as of and for the six-month period ended June 30, 2015 and as of and for the year ended December 31, 2014 are as follows:


In millions of won
June 30, 2015
Investees	Total assets		Total liabilities		Sales		Profit (loss) for the period

<Associates>
Daegu Green Power Co., Ltd.	￦	672,001		518,109		179,545		4,849
Korea Gas Corporation		41,889,182		31,636,364		15,180,204		540,739
Korea Electric Power Industrial Development Co., Ltd.		149,881		84,910		160,707		9,352
YTN Co., Ltd.		314,422		127,390		49,867		1,537
Cheongna Energy Co., Ltd.		433,793		385,302		29,864		(11,468	)
Gangwon Wind Power Co., Ltd.		117,761		35,413		13,447		5,683
Hyundai Green Power Co., Ltd.		1,181,513		805,620		236,943		14,958
Korea Power Exchange		235,294		21,689		43,209		14,052
AMEC Partners Korea		1,201		85		251		62
Hyundai Energy Co., Ltd.		544,856		471,447		43,404		(8,906	)
Ecollite Co., Ltd.		2,322		344		—		(46	)
Taebaek Wind Power Co., Ltd.		51,071		27,717		4,276		1,254
Muju Wind Power Co., Ltd.		10,817		—		—		(9	)
Pyeongchang Wind Power Co., Ltd.		61,345		47,483		—		(909	)
Daeryun Power Co., Ltd.		803,118		605,347		131,692		(12,667	)
JinanJangsu Wind Power Co., Ltd.		307		—		—		(1	)
Changjuk Wind Power Co., Ltd.		43,424		20,220		4,230		1,584
KNH Solar Co., Ltd.		27,704		21,147		2,055		269
SPC Power Corporation		191,248		53,455		31,725		17,285
Gemeng International Energy Co., Ltd.		5,863,260		3,749,828		599,719		57,331
PT. Cirebon Electric Power		1,010,012		825,745		139,105		19,210
KNOC Nigerian East Oil Co., Ltd.		253,391		321,570		—		(3,791	)
KNOC Nigerian West Oil Co., Ltd.		154,020		216,593		—		(3,426	)
Dolphin Property Limited		247		1		—		(32	)
PT Wampu Electric Power		168,398		132,895		6,207		(4,282	)
PT. Bayan Resources TBK		1,072,742		922,852		221,439		(14,863	)
S-Power Co., Ltd.		941,424		666,761		356,638		8,651
Pioneer Gas Power Limited		251,037		181,219		—		(2	)
Eurasia Energy Holdings		575		1,026		—		—
Xe-Pian Xe-Namnoy Power Co., Ltd.		362,608		260,848		—		5,185
Busan Solar Co., Ltd.		26,426		22,327		1,871		(209	)
Hadong Mineral Fiber Co., Ltd.		12		19		—		(17	)
Green Biomass Co., Ltd.		9,366		10,170		2,491		(447	)
PT. Mutiara Jawa		26,080		27,861		902		(4,169	)
Samcheok Eco Material Co., Ltd.		23,378		102		—		(1,279	)
Noeul Green Energy Co., Ltd.		739		18		—		(213	)
Naepo Green Energy Co., Ltd.		110,863		974		1,611		(2,369	)
Goseong Green Energy Co., Ltd.		99,168		4,942		—		(2,217	)
Gangneung Eco Power Co., Ltd.		49,264		4,913		—		(1,704	)
Shin Pyeongtaek Power Co., Ltd.		12,311		13,851		—		(821	)
Heang Bok Do Si Photovoltaic Power Co., Ltd.		3,171		2,557		230		19
DS POWER Co., Ltd.		570,170		451,016		21,881		(2,338	)
Dongducheon Dream Power Co., Ltd.		1,687,513		1,395,991		474,837		9,478
KS Solar Corp. Ltd.		31,191		27,907		2,656		285
Yeongwol Energy Station Co., Ltd.		164,947		153,879		—		—
Jinbhuvish Power Generation Pvt. Ltd.		77,403		21,118		—		(775	)
SE Green Energy Co., Ltd.		7,540		—		—		(47	)
Daegu Photovoltaic Co., Ltd.		21,347		14,974		2,274		920
Jeongam Wind Power Co., Ltd.		1,519		33		—		(889	)
Korea Power Engineering Service Co., Ltd.		6,381		1,671		10,359		689
Busan Green Energy Co., Ltd.		50,114		14		—		(119	)
Jungbu Bio Energy Co., Ltd.		4,739		1		—		(562	)

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(4)

Summary of financial information of associates and joint ventures as of and for the six-month period ended June 30, 2015 and as of and for the year ended December 31, 2014 are as follows, continued:


In millions of won
June 30, 2015
Investees	Total assets		Total liabilities		Sales		Profit (loss) for the period

<Joint ventures>
KEPCO-Uhde Inc.	￦	16,492		3,175		—		(360	)
Eco Biomass Energy Sdn. Bhd.		—		—		—		—
Datang Chaoyang Renewable Power Co., Ltd.		158,589		87,568		8,597		520
Shuweihat Asia Power Investment B.V.		34,704		20		—		331
Shuweihat Asia Operation & Maintenance Company		1,468		—		1,105		806
Waterbury Lake Uranium L.P.		55,796		20		—		—
ASM-BG Investicii AD		85,280		46,632		6,306		1,672
RES Technology AD		76,666		48,712		4,153		232
KV Holdings, Inc.		5,015		—		184		184
KEPCO SPC Power Corporation		445,970		180,918		80,367		28,253
Canada Korea Uranium Limited Partnership		289		85		—		(17	)
KEPCO Energy Resource Nigeria Limited		365,106		400,319		—		(15,927	)
Gansu Datang Yumen Wind Power Co., Ltd.		101,755		58,343		4,143		(1,942	)
Datang Chifeng Renewable Power Co., Ltd.		869,372		439,415		59,111		17,168
Datang KEPCO Chaoyang Renewable Power Co., Ltd.		69,445		43,263		3,776		559
Rabigh Electricity Company		2,564,433		2,299,097		146,608		30,052
Rabigh Operation & Maintenance Company		18,921		5,984		11,941		1,922
Jamaica Public Service Company Limited		1,059,368		676,823		69,329		674
KW Nuclear Components Co., Ltd.		31,754		25,529		4,933		2,623
Busan Shinho Solar Power Co., Ltd.		52,705		38,555		4,262		908
GS Donghae Electric Power Co., Ltd.		1,383,411		792,437		—		(1,404	)
Global Trade Of Power System Co., Ltd.		2,197		942		2,831		74
Expressway Solar-light Power Generation Co., Ltd.		21,412		14,396		1,095		218
KODE NOVUS 1 LLC.		116,688		106,026		1,998		(4,522	)
KODE NOVUS 2 LLC.		56,831		41,793		1,203		(2,129	)
Daejung Offshore Wind Power Co., Ltd.		7,165		51		—		(209	)
Amman Asia Electric Power Company		879,361		641,668		36,410		21,123
KEPCO-ALSTOM Power Electronics Systems, Inc.		56,453		47,238		10,098		(257	)
Dangjin Echo Power Co., Ltd.		136,249		230		—		(1,059	)
Honam Wind Power Co., Ltd.		42,820		29,183		3,618		1,476
Nepal Water & Energy Development Company Pty Ltd.		37,731		10,877		—		(590	)
Chun-cheon Energy Co., Ltd.		123,996		35,942		—		(1,362	)
Yeonggwangbaeksu Wind Power CO., Ltd.		104,744		86,213		516		(1,213	)
Nghi Son 2 Power Ltd.		795		137		—		(521	)
Kelar S.A.		335,708		366,071		—		(1,956	)
PT. Tanjung Power Indonesia		36,683		34,553		10,826		162
Incheon New Power Co., Ltd.		9,581		7,799		1,818		311
Seokmun Energy Co., Ltd.		39,585		39,858		—		(117	)

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(4)


In millions of won
December 31, 2014
Investees	Total assets		Total liabilities		Sales		Profit (loss) for the period

<Associates>
Daegu Green Power Co., Ltd.	￦	666,935		517,892		43,908		(7,310	)
Korea Gas Corporation		46,772,022		37,047,686		37,273,360		447,183
Korea Electric Power Industrial Development Co., Ltd.		151,511		76,953		329,215		13,118
YTN Co., Ltd.		335,740		149,337		114,743		11,289
Cheongna Energy Co., Ltd.		443,672		384,020		47,075		(11,585	)
Gangwon Wind Power Co., Ltd.		123,242		41,002		28,829		11,708
Hyundai Green Power Co., Ltd.		1,215,849		826,080		503,197		40,797
Korea Power Exchange		223,080		25,059		86,735		13,289
AMEC Partners Korea		1,234		180		671		60
Hyundai Energy Co., Ltd.		549,560		467,245		88,001		(16,214	)
Ecollite Co., Ltd.		2,467		443		—		39
Taebaek Wind Power Co., Ltd.		50,776		28,677		10,362		3,856
Muju Wind Power Co., Ltd.		10,826		—		—		(4	)
Pyeongchang Wind Power Co., Ltd.		14,772		2		—		(513	)
Daeryun Power Co., Ltd.		832,682		622,244		338,191		(9,213	)
JinanJangsu Wind Power Co., Ltd.		308		—		—		(1	)
Changjuk Wind Power Co., Ltd.		42,349		20,730		10,487		4,741
KNH Solar Co., Ltd.		28,451		21,992		4,913		1,315
SPC Power Corporation		174,917		49,131		63,969		30,959
Gemeng International Energy Co., Ltd.		5,690,748		3,727,276		1,497,330		183,604
PT. Cirebon Electric Power		985,975		828,393		266,963		23,363
KNOC Nigerian East Oil Co., Ltd.		247,785		310,719		—		(7,157	)
KNOC Nigerian West Oil Co., Ltd.		150,644		208,323		—		(6,395	)
Dolphin Property Limited		301		4		28		330
PT Wampu Electric Power		172,950		138,012		43,205		(5,121	)
PT. Bayan Resources TBK		1,221,538		1,032,312		872,876		(119,250	)
S-Power Co., Ltd.		944,442		678,431		56,822		(2,215	)
Pioneer Gas Power Limited		237,922		169,289		—		96
Eurasia Energy Holdings		562		1,003		—		—
Xe-Pian Xe-Namnoy Power Co., Ltd.		248,773		181,560		—		(2,326	)
Busan Solar Co., Ltd.		27,512		23,202		4,489		579
Hadong Mineral Fiber Co., Ltd.		12		2		—		(1	)
Green Biomass Co., Ltd.		9,378		9,745		2,062		(871	)
PT. Mutiara Jawa		28,407		25,827		15		(3,114	)
Samcheok Eco Material Co., Ltd.		23,831		—		—		(1,855	)
Noeul Green Energy Co., Ltd.		1,045		101		—		(56	)
Naepo Green Energy Co., Ltd.		118,202		5,944		1,283		(3,978	)
Goseong Green Energy Co., Ltd.		27,540		789		—		(3,115	)
Gangneung Eco Power Co., Ltd.		47,009		953		—		(1,756	)
Shin Pyeongtaek Power Co., Ltd.		5,075		5,794		—		(819	)
Heang Bok Do Si Photovoltaic Power Co., Ltd.		3,422		2,632		289		111
DS POWER Co., Ltd.		417,861		296,862		44,819		(2,662	)
Dongducheon Dream Power Co., Ltd.		1,516,412		1,201,566		—		615
KS Solar Corp. Ltd.		30,937		29,225		3,465		(1,149	)
Yeongwol Energy Station Co., Ltd.		146,917		129,511		14,393		4,981
Jinbhuvish Power Generation Pvt. Ltd.		77,510		21,414		—		(3,817	)
SE Green Energy Co., Ltd.		7,587		—		—		(255	)
Daegu Photovoltaic Co., Ltd.		22,340		16,887		3,633		739
Jeongam Wind Power Co., Ltd.		241		9		—		(472	)
Korea Power Engineering Service Co., Ltd.		7,410		2,809		18,859		3,171

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(4)


In millions of won
December 31, 2014
Investees	Total assets		Total liabilities		Sales		Profit (loss) for the period

<Joint ventures>
KEPCO-Uhde Inc.	￦	16,424		2,747		—		(819	)
Eco Biomass Energy Sdn. Bhd.		—		—		—		—
Datang Chaoyang Renewable Power Co., Ltd.		158,646		89,862		16,946		(540	)
Shuweihat Asia Power Investment B.V.		33,315		2		—		12,379
Shuweihat Asia Operation & Maintenance Company		639		11		2,713		2,129
Waterbury Lake Uranium L.P.		56,797		2		—		—
ASM-BG Investicii AD		91,205		51,990		13,137		2,012
RES Technology AD		82,721		53,272		8,757		(307	)
KV Holdings, Inc.		4,755		—		—		—
KEPCO SPC Power Corporation		464,305		210,956		169,615		63,005
Canada Korea Uranium Limited Partnership		35,990		132		—		(18	)
KEPCO Energy Resource Nigeria Limited		378,677		399,871		—		(29,048	)
Gansu Datang Yumen Wind Power Co., Ltd.		106,283		62,616		7,814		(4,399	)
Datang Chifeng Renewable Power Co., Ltd.		902,645		478,805		100,712		22,849
Datang KEPCO Chaoyang Renewable Power Co., Ltd.		70,354		44,005		8,464		1,444
Rabigh Electricity Company		2,544,622		2,325,205		284,837		57,444
Rabigh Operation & Maintenance Company		16,667		5,097		22,911		7,417
Jamaica Public Service Company Limited		1,100,431		725,307		841,390		13,183
KW Nuclear Components Co., Ltd.		25,591		19,115		9,722		4,200
Busan Shinho Solar Power Co., Ltd.		53,399		40,261		8,115		1,320
GS Donghae Electric Power Co., Ltd.		975,489		383,111		—		(1,389	)
Global Trade Of Power System Co., Ltd.		1,690		509		5,037		322
Expressway Solar-light Power Generation Co., Ltd.		22,046		14,849		3,181		22
KODE NOVUS 1 LLC.		115,584		100,636		6,490		(4,648	)
KODE NOVUS 2 LLC.		57,355		40,521		3,454		(3,034	)
Daejung Offshore Wind Power Co., Ltd.		7,443		6		—		(849	)
Amman Asia Electric Power Company		840,505		636,383		74,489		38,844
KEPCO-ALSTOM Power Electronics Systems, Inc.		24,203		15,150		18,536		(277	)
Dangjin Echo Power Co., Ltd.		125,481		16,112		—		(3,710	)
Honam Wind Power Co., Ltd.		41,041		28,892		4,873		1,311
Nepal Water & Energy Development Company Pty Ltd.		37,541		9,193		—		(1,228	)
Chun-cheon Energy Co., Ltd.		63,481		63,509		—		(78	)
Yeonggwangbaeksu Wind Power CO., Ltd.		97,043		77,298		—		(218	)
Nghi Son 2 Power Ltd.		318		111		—		(536	)
Kelar S.A.		222,068		221,210		—		(1,610	)
PT. Tanjung Power Indonesia		19,190		17,193		5,313		(175	)
Incheon New Power Co., Ltd.		9,950		8,346		1,299		57
Seokmun Energy Co., Ltd.		16,920		17,078		—		(1,379	)

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(5)

Financial information of associates and joint ventures reconciled to the Company’s investments in consolidated financial statement as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won
June 30, 2015
Investees	Net assets			Percentage of ownership (*)			Share in net assets			Investment differential		Intercompany transaction			Others			Book value

<Associates>
Daegu Green Power Co., Ltd.	￦	153,892			47.80	%		73,560			144		—			—			73,704
Korea Gas Corporation		10,252,817			21.57	%		2,211,533			—		—			—			2,211,533
Korea Electric Power Industrial Development Co., Ltd.		64,971			29.00	%		18,842			—		—			—			18,842
YTN Co., Ltd.		187,032			21.43	%		40,081			—		(51	)		—			40,030
Cheongna Energy Co., Ltd.		48,491			43.90	%		21,288			2,584		—			—			23,872
Gangwon Wind Power Co., Ltd.		82,348			15.00	%		12,352			—		—			49			12,401
Hyundai Green Power Co., Ltd.		375,892			29.00	%		109,009			—		—			—			109,009
Korea Power Exchange		213,605			100.00	%		213,605			—		—			—			213,605
AMEC Partners Korea		1,116			19.00	%		212			—		—			—			212
Hyundai Energy Co., Ltd.		73,409			46.30	%		33,988			—		(1,141	)		(1,025	)		31,822
Ecollite Co., Ltd.		1,978			36.10	%		714			—		—			(714	)		—
Taebaek Wind Power Co., Ltd.		23,353			25.00	%		5,838			—		(326	)		—			5,512
Muju Wind Power Co., Ltd.		10,817			25.00	%		2,704			—		—			—			2,704
Pyeongchang Wind Power Co., Ltd.		13,861			25.00	%		3,465			—		—			—			3,465
Daeryun Power Co., Ltd.		197,771			19.45	%		38,467			1,014		—			6			39,487
JinanJangsu Wind Power Co., Ltd.		306			25.00	%		77			—		—			—			77
Changjuk Wind Power Co., Ltd.		23,204			30.00	%		6,961			—		(384	)		—			6,577
KNH Solar Co., Ltd.		6,557			27.00	%		1,770			—		(282	)		—			1,488
SPC Power Corporation		137,794			38.00	%		52,362			—		—			—			52,362
Gemeng International Energy Co., Ltd.		2,113,432			34.00	%		718,567			—		—			—			718,567
PT. Cirebon Electric Power		184,267			27.50	%		50,673			—		—			—			50,673
KNOC Nigerian East Oil Co., Ltd.		(68,179	)		14.63	%		(9,975	)		—		—			9,975			—
KNOC Nigerian West Oil Co., Ltd.		(62,572	)		14.63	%		(9,154	)		—		—			9,154			—
Dolphin Property Limited		246			15.00	%		37			—		—			16			53
PT Wampu Electric Power		35,503			46.00	%		16,331			—		—			—			16,331
PT. Bayan Resources TBK		149,890			20.00	%		29,978			501,543		—			—			531,521
S-Power Co., Ltd.		274,663			40.00	%		109,865			—		(2,107	)		—			107,758
Pioneer Gas Power Limited		69,817			40.00	%		27,927			23,147		—			68			51,142
Eurasia Energy Holdings		(451	)		40.00	%		(180	)		—		—			180			—
Xe-Pian Xe-Namnoy Power Co., Ltd.		101,760			25.00	%		25,440			100		(400	)		(289	)		24,851
Busan Solar Co., Ltd.		4,099			19.80	%		812			—		(199	)		—			613
Hadong Mineral Fiber Co., Ltd.		(7	)		25.00	%		(2	)		—		—			2			—
Green Biomass Co., Ltd.		(803	)		34.00	%		(273	)		—		—			273			—
PT. Mutiara Jawa		(1,781	)		29.00	%		(516	)		70		—			446			—
Samcheok Eco Material Co., Ltd.		23,276			2.67	%		621			—		—			(621	)		—
Noeul Green Energy Co., Ltd.		722			20.00	%		144			—		—			—			144
Naepo Green Energy Co., Ltd.		109,889			25.00	%		27,472			—		—			—			27,472
Goseong Green Energy Co., Ltd.		94,226			2.90	%		2,733			—		—			—			2,733
Gangneung Eco Power Co., Ltd.		44,351			6.04	%		2,679			—		—			1			2,680
Shin Pyeongtaek Power Co., Ltd.		(1,541	)		40.00	%		(616	)		—		(402	)		1,018			—
Heang Bok Do Si Photovoltaic Power Co., Ltd.		614			28.00	%		172			—		—			—			172
DS POWER Co., Ltd.		119,154			10.91	%		13,000			—		1,448			5			14,453
Dongducheon Dream Power Co., Ltd.		291,522			33.61	%		97,981			—		5,398			288			103,667
KS Solar Corp. Ltd.		3,283			19.00	%		624			—		(198	)		—			426
Yeongwol Energy Station Co., Ltd.		11,068			10.00	%		1,107			—		—			—			1,107
Jinbhuvish Power Generation Pvt. Ltd.		56,285			5.16	%		2,904			5,450		—			(1	)		8,353
SE Green Energy Co., Ltd.		7,540			47.76	%		3,601			—		—			—			3,601
Daegu Photovoltaic Co., Ltd.		6,373			29.00	%		1,848			—		—			—			1,848
Jeongam Wind Power Co., Ltd.		1,486			40.00	%		594			—		—			—			594
Korea Power Engineering Service Co., Ltd.		4,711			29.00	%		1,366			—		—			—			1,366
Busan Green Energy Co., Ltd.		50,101			29.00	%		14,529			—		—			—			14,529
Jungbu Bio Energy Co., Ltd.		4,738			18.87	%		894			—		—			—			894

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(5)

Financial information of associates and joint ventures reconciled to the Company’s investments in consolidated financial statement as of June 30, 2015 and December 31, 2014 are as follows, continued:


In millions of won
June 30, 2015
Investees	Net assets			Percentage of ownership (*)			Share in net assets			Investment differential		Intercompany transaction			Others			Book value

<Joint ventures>
KEPCO-Uhde Inc.	￦	13,317			64.02	%		8,526			—		—			286			8,812
Eco Biomass Energy Sdn. Bhd.		—			61.53	%		—			—		—			—			—
Datang Chaoyang Renewable Power Co., Ltd.		71,021			40.00	%		28,408			—		—			—			28,408
Shuweihat Asia Power Investment B.V.		34,684			49.00	%		16,995			—		—			(82	)		16,913
Shuweihat Asia Operation & Maintenance Company		1,468			55.00	%		807			—		—			(1	)		806
Waterbury Lake Uranium L.P.		55,776			40.00	%		22,310			—		—			(664	)		21,646
ASM-BG Investicii AD		38,648			50.00	%		19,324			—		—			—			19,324
RES Technology AD		27,954			50.00	%		13,977			—		—			—			13,977
KV Holdings, Inc.		5,015			40.00	%		2,006			—		—			—			2,006
KEPCO SPC Power Corporation		265,052			75.20	%		199,319			—		—			—			199,319
Canada Korea Uranium Limited Partnership		204			12.50	%		26			—		—			(26	)		—
KEPCO Energy Resource Nigeria Limited		(35,213	)		30.00	%		(10,564	)		—		—			10,564			—
Gansu Datang Yumen Wind Power Co., Ltd.		43,411			40.00	%		17,365			—		—			—			17,365
Datang Chifeng Renewable Power Co., Ltd.		429,957			40.00	%		171,983			—		—			(43	)		171,940
Datang KEPCO Chaoyang Renewable Power Co., Ltd.		26,182			40.00	%		10,473			—		—			—			10,473
Rabigh Electricity Company		265,336			40.00	%		106,135			—		(77,479	)		(13	)		28,643
Rabigh Operation & Maintenance Company		12,936			40.00	%		5,175			—		—			—			5,175
Jamaica Public Service Company Limited		382,545			40.00	%		153,018			130,726		—			(51,713	)		232,031
KW Nuclear Components Co., Ltd.		6,225			43.36	%		2,699			90		—			—			2,789
Busan Shinho Solar Power Co., Ltd.		14,150			25.00	%		3,538			—		—			—			3,538
GS Donghae Electric Power Co., Ltd.		590,974			34.00	%		200,931			—		—			—			200,931
Global Trade Of Power System Co., Ltd.		1,256			29.00	%		364			—		—			—			364
Expressway Solar-light Power Generation Co., Ltd.		7,016			29.00	%		2,035			—		—			—			2,035
KODE NOVUS 1 LLC.		10,662			50.00	%		5,331			4,732		—			—			10,063
KODE NOVUS 2 LLC.		15,037			49.00	%		7,368			—		—			—			7,368
Daejung Offshore Wind Power Co., Ltd.		7,114			49.90	%		3,550			—		—			—			3,550
Amman Asia Electric Power Company		237,693			60.00	%		142,616			—		—			(84	)		142,532
KEPCO-ALSTOM Power Electronics Systems, Inc.		9,214			51.00	%		4,699			—		—			—			4,699
Dangjin Echo Power Co., Ltd.		136,019			40.00	%		54,408			2,696		—			(591	)		56,513
Honam Wind Power Co., Ltd.		13,637			29.00	%		3,955			32		—			—			3,987
Nepal Water & Energy Development Company Pty Ltd.		26,854			59.62	%		16,009			972		—			111			17,092
Chun-cheon Energy Co., Ltd.		88,054			29.90	%		26,328			3		—			1			26,332
Yeonggwangbaeksu Wind Power Co., Ltd.		18,531			15.00	%		2,780			—		—			—			2,780
Nghi Son 2 Power Ltd.		659			50.00	%		329			—		—			—			329
Kelar S.A		(30,363	)		65.00	%		(19,736	)		2,424		—			17,312			—
PT. Tanjung Power Indonesia		2,130			35.00	%		745			—		—			—			745
Incheon New Power Co., Ltd.		1,782			29.00	%		517			—		—			—			517
Seokmun Energy Co., Ltd.		(273	)		34.00	%		(93	)		—		—			93			—

(*)	The percentage of ownership shown above is after considering the treasury stocks and others.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(5)

Financial information of associates and joint ventures reconciled to the Company’s consolidated financial statement as of June 30, 2015 and December 31, 2014 are as follows, continued:


In millions of won
December 31, 2014
Investees	Net assets			Percentage of ownership (*)			Share in net assets			Investment differential		Intercompany transaction			Others			Book value

<Associates>
Daegu Green Power Co., Ltd.	￦	149,043			47.80	%		71,242			145		—			—			71,387
Korea Gas Corporation		9,724,336			21.57	%		2,097,539			—		—			—			2,097,539
Korea Electric Power Industrial Development Co., Ltd.		74,557			29.00	%		21,622			—		—			—			21,622
YTN Co., Ltd.		186,403			21.43	%		39,946			—		(57	)		—			39,889
Cheongna Energy Co., Ltd.		59,652			43.90	%		26,187			2,584		—			—			28,771
Gangwon Wind Power Co., Ltd.		82,239			15.00	%		12,336			—		—			49			12,385
Hyundai Green Power Co., Ltd.		389,768			29.00	%		113,033			—		—			—			113,033
Korea Power Exchange		198,021			100.00	%		198,021			—		—			—			198,021
AMEC Partners Korea		1,054			19.00	%		200			—		—			—			200
Hyundai Energy Co., Ltd.		82,315			46.30	%		38,112			—		(1,162	)		(1,025	)		35,925
Ecollite Co., Ltd.		2,024			36.10	%		731			—		—			(731	)		—
Taebaek Wind Power Co., Ltd.		22,099			25.00	%		5,525			—		—			—			5,525
Muju Wind Power Co., Ltd.		10,825			25.00	%		2,706			—		—			—			2,706
Pyeongchang Wind Power Co., Ltd.		14,770			25.00	%		3,693			—		—			—			3,693
Daeryun Power Co., Ltd.		210,438			19.45	%		40,930			1,014		—			7			41,951
JinanJangsu Wind Power Co., Ltd.		308			25.00	%		77			—		—			—			77
Changjuk Wind Power Co., Ltd.		21,619			30.00	%		6,486			—		—			—			6,486
KNH Solar Co., Ltd.		6,459			27.00	%		1,744			—		—			—			1,744
SPC Power Corporation		125,787			38.00	%		47,799			—		—			—			47,799
Gemeng International Energy Co., Ltd.		1,963,472			34.00	%		667,581			—		—			—			667,581
PT. Cirebon Electric Power		157,582			27.50	%		43,335			—		—			—			43,335
KNOC Nigerian East Oil Co., Ltd.		(62,934	)		14.63	%		(9,207	)		—		—			9,207			—
KNOC Nigerian West Oil Co., Ltd.		(57,679	)		14.63	%		(8,438	)		—		—			8,438			—
Dolphin Property Limited		297			15.00	%		45			—		—			16			61
PT Wampu Electric Power		34,938			46.00	%		16,071			—		—			—			16,071
PT. Bayan Resources TBK		189,227			20.00	%		37,845			502,166		—			—			540,011
S-Power Co., Ltd.		266,011			40.00	%		106,405			—		(2,161	)		—			104,244
Pioneer Gas Power Limited		68,632			40.00	%		27,453			23,147		—			68			50,668
Eurasia Energy Holdings		(441	)		40.00	%		(176	)		—		—			176			—
Xe-Pian Xe-Namnoy Power Co., Ltd.		67,214			25.00	%		16,803			5,971		(333	)		(289	)		22,152
Busan Solar Co., Ltd.		4,311			19.80	%		853			—		—			—			853
Hadong Mineral Fiber Co., Ltd.		10			25.00	%		3			—		—			—			3
Green Biomass Co., Ltd.		(367	)		34.00	%		(125	)		—		—			125			—
PT. Mutiara Jawa		2,581			29.00	%		748			70		—			—			818
Samcheok Eco Material Co., Ltd.		23,831			2.67	%		636			—		—			(424	)		212
Noeul Green Energy Co., Ltd.		944			20.00	%		189			—		—			—			189
Naepo Green Energy Co., Ltd.		112,258			25.00	%		28,064			—		—			—			28,064
Goseong Green Energy Co., Ltd.		26,751			9.67	%		2,587			—		—			(1	)		2,586
Gangneung Eco Power Co., Ltd.		46,055			6.04	%		2,782			—		—			1			2,783
Shin Pyeongtaek Power Co., Ltd.		(719	)		40.00	%		(288	)		—		—			288			—
Heang Bok Do Si Photovoltaic Power Co., Ltd.		790			28.00	%		221			—		—			—			221
DS POWER Co., Ltd.		121,000			10.91	%		13,201			—		2,441			—			15,642
Dongducheon Dream Power Co., Ltd.		314,845			33.61	%		105,820			—		(5,275	)		—			100,545
KS Solar Corp. Ltd.		1,712			19.00	%		325			—		—			—			325
Yeongwol Energy Station Co., Ltd.		17,406			10.00	%		1,741			—		—			—			1,741
Jinbhuvish Power Generation Pvt. Ltd.		56,096			5.16	%		2,895			5,449		—			—			8,344
SE Green Energy Co., Ltd.		7,587			47.76	%		3,623			—		—			—			3,623
Daegu Photovoltaic Co., Ltd.		5,453			29.00	%		1,581			—		—			—			1,581
Jeongam Wind Power Co., Ltd.		233			40.00	%		93			—		—			—			93
Korea Power Engineering Service Co., Ltd.		4,601			29.00	%		1,334			—		—			—			1,334

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(5)

Financial information of associates and joint ventures reconciled to the Company’s consolidated financial statement as of June 30, 2015 and December 31, 2014 are as follows, continued:


In millions of won
December 31, 2014
Investees	Net assets			Percentage of ownership (*)			Share in net assets			Investment differential		Intercompany transaction			Others			Book value

<Joint ventures>
KEPCO-Uhde Inc.	￦	13,677			64.02	%		8,756			—		—			286			9,042
Eco Biomass Energy Sdn. Bhd.		—			61.53	%		—			—		—			—			—
Datang Chaoyang Renewable Power Co., Ltd.		68,785			40.00	%		27,514			—		—			—			27,514
Shuweihat Asia Power Investment B.V.		33,312			49.00	%		16,323			—		—			(82	)		16,241
Shuweihat Asia Operation & Maintenance Company		628			55.00	%		346			—		—			(1	)		345
Waterbury Lake Uranium L.P.		56,796			40.00	%		22,718			—		—			(708	)		22,010
ASM-BG Investicii AD		39,215			50.00	%		19,608			—		—			—			19,608
RES Technology AD		29,449			50.00	%		14,725			—		—			—			14,725
KV Holdings, Inc.		4,755			40.00	%		1,902			—		—			—			1,902
KEPCO SPC Power Corporation		253,349			75.20	%		190,519			—		—			—			190,519
Canada Korea Uranium Limited Partnership		35,858			12.50	%		4,482			—		—			(4,482	)		—
KEPCO Energy Resource Nigeria Limited		(21,195	)		30.00	%		(6,358	)		—		—			6,358			—
Gansu Datang Yumen Wind Power Co., Ltd.		43,667			40.00	%		17,467			—		—			—			17,467
Datang Chifeng Renewable Power Co., Ltd.		423,839			40.00	%		169,536			—		—			(40	)		169,496
Datang KEPCO Chaoyang Renewable Power Co., Ltd.		26,349			40.00	%		10,539			—		—			—			10,539
Rabigh Electricity Company		219,417			40.00	%		87,767			—		(79,646	)		—			8,121
Rabigh Operation & Maintenance Company		11,570			40.00	%		4,628			—		—			—			4,628
Jamaica Public Service Company Limited		375,124			40.00	%		150,050			130,726		—			(53,884	)		226,892
KW Nuclear Components Co., Ltd.		6,477			43.36	%		2,808			91		—			—			2,899
Busan Shinho Solar Power Co., Ltd.		13,138			25.00	%		3,284			—		—			—			3,284
GS Donghae Electric Power Co., Ltd.		592,379			34.00	%		201,409			—		—			—			201,409
Global Trade Of Power System Co., Ltd.		1,181			29.00	%		343			—		—			—			343
Expressway Solar-light Power Generation Co., Ltd.		7,197			29.00	%		2,087			—		—			—			2,087
KODE NOVUS 1 LLC.		14,949			50.00	%		7,474			4,733		—			—			12,207
KODE NOVUS 2 LLC.		16,833			49.00	%		8,248			—		—			—			8,248
Daejung Offshore Wind Power Co., Ltd.		7,437			49.90	%		3,711			—		—			—			3,711
Amman Asia Electric Power Company		204,122			60.00	%		122,473			—		—			(82	)		122,391
KEPCO-ALSTOM Power Electronics Systems, Inc.		9,052			51.00	%		4,617			—		—			—			4,617
Dangjin Echo Power Co., Ltd.		109,369			33.10	%		36,201			1,636		—			—			37,837
Honam Wind Power Co., Ltd.		12,149			29.00	%		3,523			32		—			—			3,555
Nepal Water & Energy Development Company Pty Ltd.		28,348			59.62	%		16,900			972		—			—			17,872
Chun-cheon Energy Co., Ltd.		(28	)		29.90	%		(8	)		—		—			8			—
Yeonggwangbaeksu Wind Power Co., Ltd.		19,745			15.00	%		2,962			—		—			—			2,962
Nghi Son 2 Power Ltd.		206			50.00	%		103			—		—			—			103
Kelar S.A		858			65.00	%		558			2,423		—			175			3,156
PT. Tanjung Power Indonesia		1,996			35.00	%		699			—		—			—			699
Incheon New Power Co., Ltd.		1,604			29.00	%		465			—		—			—			465
Seokmun Energy Co., Ltd.		(158	)		34.00	%		(54	)		—		—			54			—

(*)	The percentage of ownership shown above is after considering the treasury stocks and others.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(6)

As of June 30, 2015 and as of December 31, 2014, unrecognized equity interest in investments in associates and joint ventures whose book value has been reduced to zero due to accumulated losses are as follows:


In millions of won	June 30, 2015					December 31, 2014
	Unrecognized equity interest			Accumulated unrecognized equity interest		Unrecognized equity interest		Accumulated unrecognized equity interest

Green Biomass Co., Ltd.	￦	148			273		125		125
Shin Pyeongtaek Power Co., Ltd.		329			616		288		288
KEPCO Energy Resource Nigeria Limited		4,205			10,564		6,358		6,358
Chun-cheon Energy Co., Ltd.		(8	)		—		8		8
Seokmun Energy Co., Ltd.		39			93		54		54
Kelar S.A		17,311			17,311		—		—
Hadong Mineral Fiber Co., Ltd.		2			2		—		—
PT. Mutiara Jawa		446			446		—		—
Eurasia Energy Holdings		180			180		—		—

(7)

As of June 30, 2015, shareholders’ agreements on investments in associates and joint ventures that may cause future economic costs or cash outflows are as follows:

(i)

Gemeng International Energy Co., Ltd.

Gemeng International Energy Co., Ltd., issued put options on 8% of its shares to its financial investors, KEPCO Woori Sprott PEF (NPS Co-Pa PEF). If the investment fund is not collected until the maturity date (December 25, 2023, two years extension is possible), PEF can exercise the option at strike price which is the same as a principal investment price (including operating fees ratio of below 1% per annum), and also, the Company provided a performance guarantee on this agreement.

(ii)

Hyundai Energy Co., Ltd.

As of June 30, 2015, Hyundai Energy Co., Ltd., an associate of the Company, which engages in the integrated energy business, entered into a project financing loan agreement with a limit of ￦450 billion with Korea Development Bank and others, and the Company guaranteed to create a certain amount of sales profit.

Related to the above project financing, NH Power II Co., Ltd. and National Agricultural Cooperative Federation (“NACF”) has entered into an agreement with Boim Energy Co., Ltd. to acquire shares in Hyundai Energy Co., Ltd. held by Boim Energy Co., Ltd. The Company had placed guarantees for a fixed return on the investment to the financial institutions and had obtained the rights to acquire the investment securities in return preferentially.

In addition, NH Power II Co., Ltd. and NACF have a right, which can be exercised for 30 days starting from 2 months to 1 month prior to 17 years after the termination date of the contract to sell their shares to the Company. Also, if dividends to shareholders exceed annual revenue, the excessive amount shall be evenly distributed to Boim Energy Co., Ltd. and the Company.

(iii)

Taebaek Wind Power Co., Ltd.

In case non-controlling shareholders decide to dispose of their shares in Taebaek Wind Power Co., Ltd. after the warrant period of defect repair for wind power generator has expired, the Company is obligated to acquire those shares at fair value. The acquisition is to be made after the conditions of the acquisition are discussed among the parties involved, with consideration of various factors such as financial status and business situation.

(iv)

Pyeongchang Wind Power Co., Ltd.

In case non-controlling shareholders decide to dispose of their shares in Pyeongchang Wind Power Co., Ltd. after commercial operation of the power plant has started, the Company is obligated to acquire those shares at fair value. The acquisition is to be made after the conditions of the acquisition are discussed among the parties involved, with the careful consideration of various factors such as financial status and business situation.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(7)

As of June 30, 2015, shareholders’ agreements on investments in associates and joint ventures that may cause future economic costs or cash outflows are as follows, continued:

(v)

Daeryun Power Co., Ltd.

All shareholders of Daeryun Power Co., Ltd. except for POSCO Engineering & Construction Co., Ltd., have agreed to acquire the shares held by POSCO Engineering & Construction Co., Ltd. This acquisition shall be made at issuance price of the share in proportion to each shareholder’s percentage of ownership within two months after the completion of EPC construction. In connection with this agreement, the Company, one of the shareholders of Daeryun Power Co., Ltd., is obligated to acquire 1,210,772 shares of POSCO Engineering & Construction Co., Ltd.’s investment, which amounts to ￦6,054 million. In case of a merger of Daeryun Power Co., Ltd., remaining shareholders are obligated to pay the dissident shareholders’ share for their purchase price.

(vi)

Jeongam Wind Power Co., Ltd.

In case non-controlling shareholders, except for financial investors, decide to dispose of their shares in Jeongam Wind Power Co., Ltd. after the construction of the power plant has been completed, the Company is obligated to acquire those shares at fair value.

(vii)

Daejung Offshore Wind Power Co., Ltd.

In case Samsung Heavy Industries Co., Ltd., a co-participant of the joint venture agreement, decides to dispose of its shares in Daejung Offshore Wind Power Co., Ltd., the Company is obligated to acquire those shares after evaluating the economic feasibility of the facilities installed by Samsung Heavy Industries Co., Ltd.

(viii)

Dongducheon Dream Power Co., Ltd.

In case financial investors decide to dispose of their shares in Dongducheon Dream Power Co., Ltd. 5 years after the commencement of commercial operation of the power plant, the Company is obligated to acquire those shares at fair value.

(ix)

DS Power Co., Ltd.

The Company has a right to sell all shares and bonds of DS POWER Co., Ltd. to Daesung Industrial Co., Ltd. and Daesung Industrial Co., Ltd. or an authoritative person appointed by Daesung Industrial Co., Ltd.

(x)

Samcheok Eco Material Co., Ltd.

The Company has the rights to purchase the stocks should preferred stockholders elect to sell their stocks on the expected sell date (3 years from preferred stock payment date) and is required guarantee the promised yield when preferred stockholders sell their stocks.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

17.

Investments in Associates and Joint Ventures, Continued

(8)

Significant restrictions on its abilities to associates or joint ventures are as follows:


Company		Nature and extent of any significant restrictions

KNOC Nigerian East Oil Co., Ltd., KNOC Nigerian West Oil Co.,Ltd. Dolphin Property Limited		The Company has stopped its operation in Nigeria due to an ongoing litigation and payment or retrieval of investments, loans and advances are restricted until the legal dispute is resolved.

Daeryun Power Co., Ltd.		Principals on subordinated loans or dividends can only be paid to shareholders when all conditions of the loan agreement are satisfied or prior written consent of a financial institution is obtained.

Changjuk Wind Power Co., Ltd.		Principals on subordinated loans or dividends can only be paid to shareholders when all conditions of the loan agreement are satisfied or prior written consent of a financial institution is obtained.

Busan Solar Co., Ltd.		Dividends cannot be declared or paid without the prior written consent of an agency, Consus Asset Management Co., Ltd. based on the loan agreement until the principal of a loan is paid off in full.

Taebaek Wind Power Co., Ltd.		Financial institutions can reject or defer an approval with regard to the request for fund executions on subordinated loans of shareholders in order to pay senior loans based on the loan agreement.

Daegu Green Power Co., Ltd.		Only if the condition is met with the loan agreement signed by financial institutions, the investors of subordinated credit facility loans can receive payments of principal and interest and dividend. Korea Exchange Bank, the deputy, permits the amount of the payments and dividend.

KS Solar Corp. Ltd.		Dividends can only be paid to shareholders when all conditions of a loan agreement are satisfied.

KNH Solar Co., Ltd.		Principal and interest, dividends to shareholders cannot be paid without written consent of financial institutions.

DS Power Co., Ltd.		Shares cannot be transferred whole or in partial, except as permitted by the agreement.

Hyundai Green Power Co., Ltd.		- After 15 years from the completion date of facility which is financed by financial investor’s equity investment, the financial investor and the consolidated entity have appraisal right against Hyundai Steel Company (the “Operating investor”) and the Operating investor can also claim against the financial investor to sell their shares. - After 5 years from the completion date of additional facility, the Operating investor has appraisal right against the consolidated entity and the financial investor when self-generating electricity is more profitable to Hyundai Steel Company’s cash flow rather than this business - After 5 years from the completion date of the additional facility, if there exists an agreement among those relevant parties, the Operating investor may claim to dispose the entire shares of the consolidated entity and the shares owned by financial investor to the Operating investor or to the third parties which designated by the Operating investor. - After 25 years from the completion date or when operation of electricity generation business by Hyundai Green Power Co., Ltd. is no longer feasible, the Operating investor may claim to dispose the entire the shares of the consolidated entity and shares owned by financial investor to the Operating investor or to third parties which are designated by the Operating investor. - After 5 years from the completion date of additional facility, if there reaches no agreement within 60 days, even if price of fuel supply fluctuates due to statutory or other irresistible reasons so that Hyundai Green Power Co., Ltd. would face excessive gain or loss, the Operating investor (consolidated entity and financial investor) may claim the consolidated entity and the financial investor (Operating investor) to dispose (acquire) the entire shares.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

18.

Property, Plant and Equipment

(1)

Property, plant and equipment as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Acquisition cost		Government grants			Accumulated depreciation			Accumulated impairment *losses ()**			Book value
Land	￦	12,223,485		(3,103	)		—			—			12,220,382
Buildings		13,863,293		(65,218	)		(4,951,250	)		(853	)		8,845,972
Structures		55,923,655		(195,398	)		(17,051,497	)		(1,183	)		38,675,577
Machinery		52,867,798		(107,738	)		(18,322,429	)		(47,425	)		34,390,206
Ships		4,941		—			(4,006	)		—			935
Vehicles		205,861		(48	)		(159,405	)		—			46,408
Equipment		1,034,397		(813	)		(795,239	)		—			238,345
Tools		787,918		(727	)		(651,272	)		—			135,919
Construction-in-progress		37,837,193		(115,287	)		—			(38,107	)		37,683,799
Finance lease assets		2,385,262		—			(1,825,650	)		—			559,612
Asset retirement costs		6,652,483		—			(2,723,090	)		—			3,929,393
Others		8,928,219		—			(6,751,028	)		—			2,177,191


	￦	192,714,505		(488,332	)		(53,234,866	)		(87,568	)		138,903,739

(*)	The Company separately recognizes impairment loss on each asset, reflecting various factors such as physical impairment and others during the replacement.


In millions of won	December 31, 2014
	Acquisition cost		Government grants			Accumulated depreciation			Accumulated impairment *losses ()**			Book value
Land	￦	12,238,488		(3,103	)		—			—			12,235,385
Buildings		13,631,985		(67,700	)		(4,652,109	)		(853	)		8,911,323
Structures		54,734,376		(196,871	)		(16,078,416	)		(1,183	)		38,457,906
Machinery		52,242,176		(108,750	)		(16,735,238	)		(46,230	)		35,351,958
Ships		5,015		—			(3,930	)		—			1,085
Vehicles		208,337		(76	)		(157,761	)		—			50,500
Equipment		965,806		(1,002	)		(754,159	)		—			210,645
Tools		776,321		(862	)		(623,544	)		—			151,915
Construction-in-progress		32,417,619		(123,938	)		—			(38,107	)		32,255,574
Finance lease assets		2,385,251		—			(1,772,856	)		—			612,395
Asset retirement costs		7,849,712		—			(2,495,285	)		—			5,354,427
Others		8,599,484		—			(6,380,098	)		—			2,219,386


	￦	186,054,570		(502,302	)		(49,653,396	)		(86,373	)		135,812,499

(*)	The Company separately recognizes impairment loss on each asset, reflecting various factors such as physical impairment and others during the replacement.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

18.

Property, Plant and Equipment, Continued

(2)

Changes in property, plant and equipment for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Beginning balance			Acquisition			Disposal			Depreciation			Impairment *()**			Others			Ending balance

Land	￦	12,238,488			4,553			(174,910	)		—			—			155,354			12,223,485
(Government grants)		(3,103	)		—			—			—			—			—			(3,103	)
Buildings		8,979,023			108			(2,267	)		(304,449	)		—			238,775			8,911,190
(Government grants)		(67,700	)		—			—			2,516			—			(34	)		(65,218	)
Structures		38,654,777			1,483			(148,906	)		(1,051,724	)		—			1,415,345			38,870,975
(Government grants)		(196,871	)		—			633			4,566			—			(3,726	)		(195,398	)
Machinery		35,460,708			150,887			(101,388	)		(1,868,733	)		(1,205	)		857,675			34,497,944
(Government grants)		(108,750	)		—			283			5,332			—			(4,603	)		(107,738	)
Ships		1,085			—			—			(149	)		—			(1	)		935
Vehicles		50,576			2,473			(10	)		(10,653	)		—			4,070			46,456
(Government grants)		(76	)		—			1			27			—			—			(48	)
Equipment		211,647			23,724			(57	)		(51,394	)		—			55,238			239,158
(Government grants)		(1,002	)		—			—			226			—			(37	)		(813	)
Tools		152,777			8,335			(17	)		(32,709	)		—			8,260			136,646
(Government grants)		(862	)		—			—			135			—			—			(727	)
Construction-in-progress		32,379,512			7,599,022			(720	)		—			—			(2,178,728	)		37,799,086
(Government grants)		(123,938	)		(8,629	)		—			—			—			17,280			(115,287	)
Finance lease assets		612,395			—			—			(52,791	)		—			8			559,612
Asset retirement cost		5,354,427			—			—			(285,786	)		—			(1,139,248	)		3,929,393
Others		2,219,386			17,403			(24	)		(357,679	)		—			298,105			2,177,191


	￦	135,812,499			7,799,359			(427,382	)		(4,003,265	)		(1,205	)		(276,267	)		138,903,739

(*)

Korea South-East Power Co., Ltd., a 100% owned subsidiary, has determined that there is an impairment indicator and performed an impairment test over the individual assets. As a result, the Company recognized the amount of the carrying amount in excess of its recoverable amount as impairment loss in the statement of comprehensive income (loss).


In millions of won	December 31, 2014
	Beginning balance			Acquisition			Disposal			Depreciation			Impairment (*1)			Others (*2)			Ending balance

Land	￦	13,784,026			69,926			(32,912	)		—			—			(1,582,552	)		12,238,488
(Government grants)		(3,137	)		—			63			—			—			(29	)		(3,103	)
Buildings		8,549,697			32,000			(10,706	)		(590,298	)		—			998,330			8,979,023
(Government grants)		(45,396	)		—			200			5,040			—			(27,544	)		(67,700	)
Structures		37,819,108			3,184			(414,659	)		(2,030,010	)		—			3,277,154			38,654,777
(Government grants)		(193,190	)		—			2,018			8,921			—			(14,620	)		(196,871	)
Machinery		33,729,539			271,073			(207,070	)		(3,633,815	)		—			5,300,981			35,460,708
(Government grants)		(101,808	)		—			423			10,102			—			(17,467	)		(108,750	)
Ships		1,422			—			—			(342	)		—			5			1,085
Vehicles		45,719			2,295			(25	)		(21,096	)		—			23,683			50,576
(Government grants)		(83	)		—			—			47			—			(40	)		(76	)
Equipment		187,158			56,214			(171	)		(85,612	)		—			54,058			211,647
(Government grants)		(708	)		—			—			376			—			(670	)		(1,002	)
Tools		139,665			30,806			(1,642	)		(61,113	)		—			45,061			152,777
(Government grants)		(313	)		—			55			144			—			(748	)		(862	)
Construction-in-progress		27,452,029			14,112,746			(1,078	)		—			(38,107	)		(9,146,078	)		32,379,512
(Government grants)		(117,725	)		(42,150	)		—			—			—			35,937			(123,938	)
Finance lease assets		735,185			—			(348	)		(122,088	)		—			(354	)		612,395
Asset retirement cost		5,654,596			—			—			(573,497	)		—			273,328			5,354,427
Others		2,001,812			11,405			(53	)		(702,985	)		—			909,207			2,219,386


	￦	129,637,596			14,547,499			(665,905	)		(7,796,226	)		(38,107	)		127,642			135,812,499

(*1)

Garorim Tidal Power Plant Co., Ltd. (“GTPP”), a 49% owned subsidiary, has not yet started its operation and it is not expected to operate based on the results of the business feasibility study. The Company has considered this to be an impairment indicator and performed an impairment test over the individual assets of GTPP. As a result, the Company recognized the amount of the carrying amount in excess of its recoverable amount as impairment loss in the statement of comprehensive income (loss).

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

18.

Property, Plant and Equipment, Continued

(2)

Changes in property, plant and equipment for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows, continued:

(*2)	‘Others’ includes ￦2,090,810 million of assets held for sale (note 41) comprising land, buildings, and structures and the amount is ￦2,021,445 million, ￦69,363 million, and ￦2 million, respectively.

19.

Investment Properties

(1)

Investment properties as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Acquisition cost		Government grants			Accumulated depreciation			Accumulated impairment losses		Book value

Land	￦	221,759		—			—			—		221,759
Buildings		25,833		(13	)		(9,998	)		—		15,822


	￦	247,592		(13	)		(9,998	)		—		237,581


In millions of won	December 31, 2014
	Acquisition cost		Government grants			Accumulated depreciation			Accumulated impairment losses		Book value

Land	￦	301,483		—			—			—		301,483
Buildings		26,168		(10	)		(10,377	)		—		15,781


	￦	327,651		(10	)		(10,377	)		—		317,264

(2)

Changes in investment properties for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Beginning balance			Acquisition		Disposal		Depreciation			Impairment		Others			Ending balance

Land	￦	301,483			—		—		—			—		(79,724	)		221,759
Buildings		15,791			—		—		(347	)		—		391			15,835
(Government grants)		(10	)		—		—		—			—		(3	)		(13	)


	￦	317,264			—		—		(347	)		—		(79,336	)		237,581


In millions of won	December 31, 2014
	Beginning balance			Acquisition		Disposal		Depreciation			Impairment		Others			Ending balance

Land	￦	516,440			—		—		—			—		(214,957	)		301,483
Buildings		21,899			—		—		(824	)		—		(5,284	)		15,791
(Government grants)		(12	)		—		—		4			—		(2	)		(10	)


	￦	538,327			—		—		(820	)		—		(220,243	)		317,264

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

19.

Investment Properties, Continued

(3)

Income and expenses related to investment properties for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015						June 30, 2014
	Three-month period ended			Six-month period ended			Three-month period ended			Six-month period ended

Rental income	￦	2,651			4,843			2,084			4,819
Operating and maintenance expenses related to rental income		(185	)		(347	)		(234	)		(417	)


	￦	2,466			4,496			1,850			4,402

(4)

Fair value of investment properties as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015				December 31, 2014
	Book value		Fair value		Book value		Fair value

Land	￦	221,759		251,576		301,483		342,809
Buildings		15,822		17,401		15,781		16,523


	￦	237,581		268,977		317,264		359,332

The fair values of the investment properties as of the reporting date were determined in consideration of the fluctuation on the publicly announced individual land price after the K-IFRS transition date.

(5)

All of the Company’s investment property is held under freehold interests.

20.

Construction Contracts

(1)

Changes in balance of construction service contracts for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Beginning balance		Increase and decrease (*)		Recognized revenue			Ending balance

Nuclear power plant construction in UAE	￦	16,628,720		269,990		(1,732,891	)		15,165,819
Kazakhstan EPC and others		452,354		409,396		(164,194	)		697,556


	￦	17,081,074		679,386		(1,897,085	)		15,863,375

(*)	For the six-month period ended June 30, 2015, the increased balance of contracts from new orders and other is ￦752,350 million and the decreased balance of contracts from changes in size of construction is ￦72,964 million.


In millions of won	December 31, 2014
	Beginning Balance		Increase and decrease (*)		Recognized revenue			Ending balance

Nuclear power plant construction in UAE	￦	18,522,411		548,656		(2,442,347	)		16,628,720
Kazakhstan EPC and others		811,005		164,187		(522,838	)		452,354


	￦	19,333,416		712,843		(2,965,185	)		17,081,074

(*)	For the year ended December 31, 2014, the increased balance of contracts from new orders and other is ￦831,159 million and the decreased balance of contracts from changes in size of construction is ￦118,316 million.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

20.

Construction Contracts, Continued

(2)

Accumulated earned revenue, expense and others related to the Company’s construction as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Accumulated earned revenue		Accumulated expense		Accumulated profit		Unearned advance receipts

Nuclear power plant construction in UAE	￦	9,136,058		8,614,796		521,262		—
Kazakhstan EPC and others		1,269,704		1,237,475		32,229		—


	￦	10,405,762		9,852,271		553,491		—


In millions of won	December 31, 2014
	Accumulated earned revenue		Accumulated expense		Accumulated profit		Unearned advance receipts

Nuclear power plant construction in UAE	￦	7,403,167		6,969,719		433,448		—
Kazakhstan EPC and others		1,347,719		1,291,365		56,354		—


	￦	8,750,886		8,261,084		489,802		—

(3)

Gross amount due from customers recognized as assets and due to customers recognized as liabilities for contract work as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015				December 31, 2014
	*Assets (1)**		*Liabilities (2)**		*Assets (1)**		*Liabilities (2)**

Nuclear power plant construction in UAE	￦	—		1,062,607		—		934,799
Kazakhstan EPC and others		103,933		18,319		149,876		1,033


	￦	103,933		1,080,926		149,876		935,832

(*1)	Included in trade and other receivables, net, in the accompanying consolidated statements of financial position.

(*2)	Included in non-financial liabilities in the accompanying consolidated statements of financial position.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

21.

Intangible Assets other than Goodwill

(1)

Intangible assets as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Acquisition cost		Government grants			Accumulated amortization			Accumulated impairment losses			Book value

Software	￦	367,594		(459	)		(317,096	)		—			50,039
Licenses and franchises		3,398		—			(3,380	)		—			18
Copyrights, patents rights and other industrial rights		32,323		—			(10,783	)		—			21,540
Mining rights		496,547		—			(6,929	)		—			489,618
Development expenditures		745,393		(7,328	)		(687,705	)		—			50,360
Intangible assets under development		83,389		(10,300	)		—			—			73,089
Usage rights of donated assets and other		375,275		(37	)		(322,136	)		—			53,102
Leasehold rights		19,112		—			(18,350	)		—			762
Others		157,116		(1	)		(76,120	)		(12,411	)		68,584


	￦	2,280,147		(18,125	)		(1,442,499	)		(12,411	)		807,112


In millions of won	December 31, 2014
	Acquisition cost		Government grants			Accumulated amortization			Accumulated impairment losses			Book value

Software	￦	354,443		(488	)		(301,887	)		—			52,068
Licenses and franchises		3,398		—			(3,344	)		—			54
Copyrights, patents rights and other industrial rights		31,929		—			(9,252	)		—			22,677
Mining rights		510,869		—			(6,655	)		—			504,214
Development expenditures		730,401		(8,183	)		(674,544	)		—			47,674
Intangible assets under development		74,909		(10,692	)		—			—			64,217
Usage rights of donated assets and other		375,275		(43	)		(317,588	)		—			57,644
Leasehold rights		19,112		—			(18,333	)		—			779
Others		156,503		(1	)		(72,180	)		(12,589	)		71,733


	￦	2,256,839		(19,407	)		(1,403,783	)		(12,589	)		821,060

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

21.

Intangible Assets other than Goodwill, Continued

(2)

Changes in intangible assets for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Beginning balance			Acquisition			Disposal			Amortization			Impairment			Others			Ending balance

Software	￦	52,556			3,174			—			(17,137	)		—			11,905			50,498
(Government grants)		(488	)		—			—			84			—			(55	)		(459	)
Licenses and franchises		54			—			—			(36	)		—			—			18
Copyrights, patents rights and other industrial rights		22,677			72			—			(1,508	)		—			299			21,540
Mining rights		504,214			6,253			—			(168	)		—			(20,681	)		489,618
Development expenditures		55,857			7,841			(5	)		(13,141	)		—			7,136			57,688
(Government grants)		(8,183	)		—			—			1,651			—			(796	)		(7,328	)
Intangible assets under development		74,909			17,401			—			—			—			(8,921	)		83,389
(Government grants)		(10,692	)		(1,271	)		—			—			—			1,663			(10,300	)
Usage rights of donated assets and other		57,687			—			—			(4,523	)		—			(25	)		53,139
(Government grants)		(43	)		—			—			5			—			1			(37	)
Leasehold rights		779			—			—			(17	)		—			—			762
Others		71,734			475			(131	)		(2,857	)		—			(636	)		68,585
(Government grants)		(1	)		—			—			—			—			—			(1	)


	￦	821,060			33,945			(136	)		(37,647	)		—			(10,110	)		807,112


In millions of won	December 31, 2014
	Beginning balance			Acquisition			Disposal			Amortization			Impairment			Others			Ending balance

Software	￦	65,751			7,135			—			(32,423	)		—			12,093			52,556
(Government grants)		(430	)		—			—			154			—			(212	)		(488	)
Licenses and franchises		208			—			—			(154	)		—			—			54
Copyrights, patents rights and other industrial rights		24,953			451			—			(2,965	)		—			238			22,677
Mining rights		470,558			28,472			—			(1,945	)		—			7,129			504,214
Development expenditures		76,154			47			(1,810	)		(28,555	)		—			10,021			55,857
(Government grants)		(11,705	)		—			—			4,125			—			(603	)		(8,183	)
Intangible assets under development		52,050			33,202			(170	)		—			(11	)		(10,162	)		74,909
(Government grants)		(7,792	)		(3,597	)		170			—			—			527			(10,692	)
Usage rights of donated assets and other		64,710			—			—			(8,875	)		—			1,852			57,687
(Government grants)		(53	)		—			—			10			—			—			(43	)
Leasehold rights		812			—			—			(33	)		—			—			779
Others		75,449			2,914			(5	)		(5,752	)		(31	)		(841	)		71,734
(Government grants)		(1	)		—			—			—			—			—			(1	)


	￦	810,664			68,624			(1,815	)		(76,413	)		(42	)		20,042			821,060

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

21.

Intangible Assets other than Goodwill, Continued

(3)

Significant intangible assets as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won and thousands of Australian dollars
June 30, 2015
Type	Description	Currency	Amount		Remaining useful years

Software	ERP system and others	KRW		3,001	5 months ~ 3 years and 5 months
Copyrights, patents rights and other industrial rights	Smart technology verification and standard design project conducting right	KRW		7,250	7 years and 3 months
Mining rights	Mining right of Bylong mine	AUD		401,225	— (*)
Development expenditures	KOSPO Evolutionary Efficient & Powerful System(KEEPS)	KRW		3,587	2 years
	Development of maintenance system for utility plant	KRW		1,367	2 years and 5 months
Intangible assets under development	Contributions to APR NRC DC	KRW		26,153	—
	CHF testing for best representative of HIPER/X2-Gen Fuel and development of best explanatory CHF correlation	KRW		8,567	—
Usage rights of donated assets	Songdo international business district(sector 1, 3) sharing charge	KRW		3,555	2 years and 4 months
	Dangjin power plant load facility usage right	KRW		36,204	5 years and 9 months
Others	Shingwangju electricity supply facility usage right	KRW		2,866	3 years and 11 months
	Sillim electricity supply facility usage right	KRW		2,633	6 years and 5 months

(*)	Mining rights are amortized using the units-of-production method and the amortization has not commenced yet.


In millions of won and thousands of Australian dollars
December 31, 2014
Type	Description	Currency	Amount		Remaining useful years

Software	ERP system and others	KRW		6,583	6 months ~ 1 years and 2 months
Copyrights, patents rights and other industrial rights	Smart technology verification and standard design project conducting right	KRW		7,750	7 years and 9 months
Mining rights	Mining right of Bylong mine	AUD		401,225	— (*)
Development expenditures	KOSPO Evolutionary Efficient & Powerful System(KEEPS)	KRW		5,381	2 years and 6 months
	Development of maintenance system for utility plant	KRW		1,649	2 years and 11 months
Intangible assets under development	Contributions to APR NRC DC	KRW		18,252	—
	CHF testing for best representative of HIPER/X2-Gen Fuel and development of best explanatory CHF correlation	KRW		8,396	—
Usage rights of donated assets	Songdo international business district(sector 1, 3) sharing charge	KRW		4,316	2 years and 10 months
	Dangjin power plant load facility usage right	KRW		39,352	6 years and 3 months
Others	Shingwangju electricity supply facility usage right	KRW		3,089	4 years and 5 months
	Sillim electricity supply facility usage right	KRW		2,969	6 years and 11 months

(*)	Mining rights are amortized using the units-of-production method and the amortization has not commenced yet.

(4)

For the six-month periods ended June 30, 2015 and 2014, the Company recognized research and development expenses of ￦262,652 million and ￦246,595 million, respectively.

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

22.

Trade and Other Payables

Trade and other payables as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015				December 31, 2014
	Current		Non-current		Current		Non-current

Trade payables	￦	1,617,549		—		3,123,341		—
Other trade payables		1,658,715		3,081,954		1,600,102		3,017,428
Accrued expenses		1,225,671		2,562		1,126,357		2,411
Leasehold deposits received		1,849		—		2,020		—
Other deposits received		176,301		103,559		166,143		96,531
Finance lease liabilities		112,908		601,285		109,374		660,061
Dividends payable		1,219		—		1,267		—
Others		—		20,339		—		30,304


	￦	4,794,212		3,809,699		6,128,604		3,806,735

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

23.

Borrowings and Debt Securities

(1)

Borrowings and debt securities as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014
Current liabilities
Short-term borrowings	￦	856,572			658,778
Current portion of long-term borrowings		585,630			455,484
Current portion of debt securities		6,382,226			5,994,205
Less : Current portion of discount on long-term borrowings		(926	)		(908	)
Less : Current portion of discount on debt securities		(2,351	)		(2,807	)

		7,821,151			7,104,752


Non-current liabilities
Long-term borrowings		1,833,588			3,490,700
Debt securities		51,264,161			52,359,905
Less : Discount on long-term borrowings		(14,497	)		(15,494	)
Less : Discount on debt securities		(112,774	)		(115,807	)
Add : Premium on debt securities		264			271

		52,970,742			55,719,575


	￦	60,791,893			62,824,327

(2)

Short-term borrowings as of June 30, 2015 and December 31, 2014 are as follows:

In millions of won and thousands of U.S. dollars

June 30, 2015

Type

Creditor

Interest rate (%)

Foreign
currency

Local
currency

Local short-term borrowings

Woori Investment Bank and others

1.62 ~ 2.80

—

￦

798,180

Local short-term borrowings

HSBC and others

3M Libor + 0.35 ~ 0.37

—

27,432

Foreign short-term borrowings

SCNT and others

6.50

USD

2,186

2,457

Local bank overdraft

Woori Bank

Standard overdraft rate + 1.12

—

28,503

￦

856,572

In millions of won and thousands of U.S. dollars

December 31, 2014

Type

Creditor

Interest rate (%)

Foreign
currency

Local
currency

Local short-term borrowings

KTB Investment Bank

2.12

—

￦

310,000

Local commercial paper

Shinhan Bank and others

2.12 ~ 2.20

—

310,000

Foreign short-term borrowings

Mizuho Bank and others

0.47 ~ 6.50

USD

16,366

17,990

Local bank overdraft

Woori Bank

Standard overdraft rate + 1.27

—

20,788

￦

658,778

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

23.

Borrowings and Debt Securities, Continued

(3)

Long-term borrowings as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won and thousands of foreign currencies
June 30, 2015
Type		Interest rate (%)	Maturity	Foreign currency		Local currency
Local long-term borrowings
Korea Development Bank	Others	0.50	2015 ~ 2044		—	￦	6,796
	Facility	4.60	2028		—		42,420
	Facility	3yr KTB rate – 1.25	2027		—		9,000
	Facility	1yr KoFC bond rate + 0.31	2018		—		200,000
	Operating funds	2.75	2018		—		12,000
Korea Exchange Bank	Commercial Paper	3M CD + 0.03 ~ 0.54	2015 ~ 2017		—		600,000
	Facility	3yr KTB rate – 1.25	2021 ~ 2028		—		10,717
	Facility	4.60	2028		—		19,458
	Energy rationalization	3yr KTB rate – 1.25	2019		—		750
	Energy rationalization	3.20 ~ 3.70	2016		—		3,835
Korea Industrial Bank	Others	3yr KTB rate – 1.25	2016		—		4,000
Hana Bank	PF Refinancing	CD + 1.70	2026		—		20,957
	PF Refinancing	4.80	2026		—		11,991
Export-Import Bank of Korea	Project loans	2.00	2026		—		32,408
Korea Resources Corporation	Development of power resources	3yr KTB rate – 2.25	2022 ~ 2025		—		46,568
	Facility	3yr KTB rate – 2.25	2023 ~ 2024		—		4,679
	Project loans	—	2022 ~ 2027		—		8,677
	Others	3yr KTB rate – 2.25	2024 ~ 2025		—		13,430
Shinhan Bank and others	Facility	3yr AA- CB rate + 1.10	2028		—		29,188
	Operating funds	3.35	2017		—		10,000
Woori Bank	PF Refinancing	CD + 1.70	2023 ~ 2026		—		21,613
	PF Refinancing	4.80	2026		—		11,991
Kookmin Bank	Facility	MOR + 0.62 ~ 0.79	2017 ~ 2023		—		18,373
Others	Facility	4.60 ~ 5.80	2025 ~ 2028		—		152,583
	Facility	3yr AA- CB rate + 1.10	2028		—		19,458
	PF Refinancing	4.80	2026		—		17,267
	PF Refinancing	CD + 1.70	2026		—		523
	Others	—	—		—		39,637
	Others	—	2028		—		7,250

							1,375,569

Foreign long-term borrowings
Korea National Oil Corporation	Project loans	—	2021 ~ 2023	USD	8,784		9,874
Export-Import Bank of Korea and others	Direct loan and others	3M Libor + 2.60 ~ 3.70	2027	JOD	193,536		306,912
	Commercial loan and others	3M Libor + 1.50 ~ 2.50	2030 ~ 2033	USD	310,673		349,227
	PF Loan	3M Libor + 2.50	2032	USD	43,649		49,066
SCNT and others	Shareholder’s loan	6.50 ~ 8.00	2023	USD	37,481		42,132
	Shareholder’s loan	8.00	2031	JOD	8,498		13,476
PT PJB and others	Shareholder’s loan	12.75	2017	IDR	20,011,876		1,685
HSBC and others	Syndicated loan	3M Libor + 0.30 ~ 0.50	2017 ~ 2019	USD	42,361		47,618
Others	Others	3M Libor + 0.95	2016	USD	189,903		213,470
	Others	—	2019	USD	9,064		10,189

							1,043,649

							2,419,218

Less : Discount of long-term borrowings							(15,423	)
Less : Current portion of long-term borrowings							(585,630	)
Add : Current portion of discount of long-term borrowings							926


						￦	1,819,091

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

23.

Borrowings and Debt Securities, Continued

(3)

Long-term borrowings as of June 30, 2015 and December 31, 2014 are as follows, continued:


In millions of won and thousands of foreign currencies
December 31, 2014
Type		Interest rate (%)	Maturity	Foreign currency		Local currency
Local long-term borrowings
Korea Development Bank	Others	0.50	2015 ~ 2044		—	￦	7,178
	Facility	4.60	2028		—		43,600
	Facility	3yr KTB rate – 1.25	2027		—		9,000
	Facility	1yr KoFC bond rate + 0.20 ~ 0.31	2018 ~ 2019		—		1,500,000
Korea Exchange Bank	Commercial Paper	3M CD + 0.03 ~ 0.54	2015 ~ 2017		—		900,000
	Facility	3yr KTB rate – 1.25	2021 ~ 2028		—		11,071
	Facility	4.60	2028		—		20,000
	Energy rationalization	3yr KTB rate – 1.25	2019		—		850
	Energy rationalization	3.20~3.70	2016		—		3,835
Korea Industrial Bank	Others	3yr KTB rate – 1.25	2016		—		8,000
Hana Bank	PF Refinancing	CD + 1.70	2026		—		21,613
	PF Refinancing	4.80	2026		—		11,992
Export-Import Bank of Korea	Project loans	2.00	2026		—		33,881
Korea Resources Corporation	Development of power resources	3yr KTB rate – 2.25	2022 ~ 2027		—		48,167
	Facility	3yr KTB rate – 2.25	2023 ~ 2024		—		4,958
	Project loans	—	2022 ~ 2027		—		8,677
	Others	3yr KTB rate – 2.25	2024 ~ 2025		—		13,661
Shinhan Bank and others	Facility	3yr AA- CB rate + 1.10	2028		—		30,000
	Operating	3.35	2017		—		10,000
Woori Bank	PF Refinancing	CD + 1.70	2023 ~ 2026		—		21,613
	PF Refinancing	4.80	2026		—		11,991
Kookmin Bank	Facility	MOR + 0.62	2017		—		6,600
Others	Facility	4.60 ~ 5.80	2025 ~ 2028		—		157,320
	Facility	—	2028		—		20,000
	PF Refinancing	4.80	2026		—		17,267
	PF Refinancing	CD + 1.70	2026		—		523
	Others	—	—		—		38,981
	Others	—	2028		—		7,250

							2,968,028

Foreign long-term borrowings
Korea National Oil Corporation	Project loans	—	2021 ~ 2023	USD	8,784		9,656
Export-Import Bank of Korea and others	Direct loan and others	3M Libor + 2.60 ~ 3.70	2027	JOD	197,907		307,324
	Commercial loan and others	3M Libor + 1.50 ~ 2.50	2015 ~ 2033	USD	308,697		339,320
SCNT and others	Shareholder’s loan	6.50 ~ 8.00	2033 ~ 2034	USD	35,165		38,654
	Shareholder’s loan	8.00	2031	JOD	8,498		13,197
PT PJB and others	Shareholder’s loan	12.75	2017	IDR	22,307,699		1,970
HSBC and others	Syndicated loan	3M Libor + 0.27 ~ 1.50	2017 ~ 2019	USD	52,949		58,201
Others	Others	3M Libor + 0 .95	2016	USD	180,893		198,838
	Others	—	2019	USD	10,004		10,996

							978,156

							3,946,184

Less : Discount of long-term borrowings							(16,402	)
Less : Current portion of long-term borrowings							(455,484	)
Add : Current portion of discount of long-term borrowings							908


						￦	3,475,206

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

23.

Borrowings and Debt Securities, Continued

(4)

Local debt securities as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won
	Issue date	Maturity	Interest rate (%)	June 30, 2015			December 31, 2014

Electricity Bonds (*)	2008.07.29 ~ 2014.08.27	2015.07.29 ~ 2033.08.06	2.73 ~ 7.19	￦	24,060,000			25,820,000
Electricity Bonds	2012.05.29 ~ 2013.06.25	2016.05.29 ~ 2018.06.25	3M CD + 0.25 ~ 0.31		910,000			1,160,000
Corporate Bonds	2009.05.04 ~ 2015.06.29	2015.07.07 ~ 2040.12.10	1.93 ~ 5.84		20,260,010			19,570,010

					45,230,010			46,550,010


Less : Discount on local debt securities					(43,800	)		(43,517	)
Less : Current portion of local debt securities					(4,190,000	)		(4,400,000	)
Add : Current portion of discount on local debt securities					777			611


				￦	40,996,987			42,107,104

(*)	Electricity Bonds 885 (￦40,000 million) can be redeemed every April 28 after three years from its issue date, April 28, 2014.

(5)

Foreign debt securities as of June 30, 2015 and December 31, 2014 are as follows:

In millions of won and thousands of foreign currencies

June 30, 2015

Type

Issue date

Maturity

Interest rate (%)

Foreign
currency

Local
currency

FY-96

1996.04.01 ~ 1996.12.06

2026.12.06 ~ 2096.04.01

6.00 ~ 8.37

USD

249,271

￦

280,206

FY-97

1997.01.31 ~ 1997.08.04

2027.01.31 ~ 2027.08.04

6.75 ~ 7.00

USD

314,717

353,773

FY-04

2004.04.21

2034.04.21

5.13

USD

286,920

322,527

FY-06

2006.03.14 ~ 2006.09.29

2016.03.14 ~ 2016.09.29

5.50 ~ 6.00

USD

650,000

730,665

FY-08

2008.11.27

2018.11.27

4.19

JPY

20,000,000

183,430

FY-10

2010.09.16 ~ 2010.10.05

2015.09.16 ~ 2015.10.05

3.00 ~ 3.13

USD

1,200,000

1,348,920

FY-10

2010.07.29 ~ 2010.11.18

2015.07.29 ~ 2015.11.18

3M Libor + 1.00 ~ 1.64

USD

250,000

281,025

FY-11

2011.07.13 ~ 2011.07.29

2017.01.30 ~ 2021.07.13

3.63 ~ 4.75

USD

800,000

899,280

FY-12

2012.05.10 ~ 2012.09.19

2017.05.10 ~ 2022.09.19

2.50 ~ 3.13

USD

1,750,000

1,967,175

FY-13

2013.02.05 ~ 2013.11.27

2018.02.05 ~ 2018.11.27

1.88 ~ 2.88

USD

1,900,000

2,135,790

FY-13

2013.09.26 ~ 2013.10.23

2019.03.26 ~ 2019.04.23

1.50 ~ 1.63

CHF

400,000

485,676

FY-13

2013.09.25

2020.09.25

5.75

AUD

325,000

280,430

FY-13

2013.02.20 ~ 2013.07.25

2018.02.20 ~ 2018.07.25

3M Libor + 0.84 ~ 1.50

USD

500,000

562,050

FY-14

2014.02.11 ~ 2014.12.02

2019.02.11 ~ 2029.07.30

2.38 ~ 3.57

USD

1,500,000

1,686,150

FY-14

2014.01.28 ~ 2014.07.31

2017.01.28 ~ 2017.07.31

3M Libor + 0.55 ~ 1.50

USD

500,000

562,050

FY-15

2015.06.15

2025.06.15

3.25

USD

300,000

337,230

12,416,377

Less : Discount on foreign debt securities

(71,325

)

Add : Premium on debt securities

263

Less : Current portion of foreign debt securities

(2,192,226

)

Add : Current portion of discount on foreign debt securities

1,574

￦

10,154,663

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

23.

Borrowings and Debt Securities, Continued

(5)

Foreign debt securities as of June 30, 2015 and December 31, 2014 are as follows, continued:

In millions of won and thousands of foreign currencies

December 31, 2014

Type

Issue date

Maturity

Interest rate (%)

Foreign
currency

Local
currency

FY-96

1996.04.01 ~ 1996.12.06

2026.12.06 ~ 2096.04.01

6.00 ~ 8.37

USD

249,470

￦

274,217

FY-97

1997.01.31 ~ 1997.08.04

2027.01.31 ~ 2027.08.04

6.75 ~ 7.00

USD

314,717

345,937

FY-04 (*)

2004.04.21

2034.04.21

5.13

USD

286,920

315,382

FY-06

2006.03.14 ~ 2006.09.29

2016.03.14 ~ 2016.09.29

5.50 ~ 6.00

USD

650,000

714,480

FY-08

2008.11.27

2018.11.27

4.19

JPY

20,000,000

184,028

FY-10

2010.09.16 ~ 2010.10.05

2015.09.16 ~ 2015.10.05

3.00 ~ 3.13

USD

1,200,000

1,319,040

FY-10

2010.07.29 ~ 2010.11.18

2015.07.29 ~ 2015.11.18

3M Libor + 1.00 ~ 1.64

USD

250,000

274,800

FY-11

2011.07.13 ~ 2011.07.29

2017.01.30 ~ 2021.07.13

3.63 ~ 4.75

USD

800,000

879,360

FY-12

2012.05.10 ~ 2012.09.19

2017.05.10 ~ 2022.09.19

2.50 ~ 3.13

USD

1,750,000

1,923,600

FY-13

2013.02.05 ~ 2013.11.27

2018.02.05 ~ 2018.11.27

1.88 ~ 2.88

USD

1,900,000

2,088,480

FY-13

2013.09.26 ~ 2013.10.23

2018.04.23 ~ 2019.03.26

1.50 ~ 1.63

CHF

400,000

444,572

FY-13

2013.09.25

2020.09.25

5.75

AUD

325,000

292,204

FY-13

2013.02.20 ~ 2013.07.25

2018.02.20 ~ 2018.07.25

3M Libor + 0.84 ~ 1.50

USD

500,000

549,600

FY-14

2014.02.11 ~ 2014.12.02

2019.02.11 ~ 2029.07.30

2.38 ~ 2.75

USD

1,500,000

1,648,800

FY-14

2014.01.28 ~ 2014.07.31

2017.01.28 ~ 2017.07.31

3M Libor + 0.55 ~ 1.50

USD

500,000

549,600

11,804,100

Less : Discount on foreign debt securities

(75,097

)

Add : Premium on debt securities

272

Less : Current portion of foreign debt securities

(1,594,205

)

Add : Current portion of discount on foreign debt securities

2,196

￦

10,137,266

(*)	For Global 4 in FY-04, early redemption of USD 13,080,000 was requested during the year ended December 31, 2014 and the remaining amount is USD 286,920,000 as of June 30, 2015.

100

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

24.

Finance Lease Liabilities

(1)

Lease contracts

The Company enters into a power purchase agreements (“PPA”) under which the Company is committed to purchase an aggregate capacity of 3,770 megawatts for approximately twenty years from independent power producers, such as, GS EPS and three other providers. The Company recognizes these PPAs as finance leases; under the PPAs, there is no transfer of ownership or bargain purchase option of the plants at the end of the agreement, however, the present value of the future minimum power purchase payments equals substantially all of the plants’ respective fair values over a twenty-year period which makes up the major part of the respective plants’ economic life.

(2)

Finance lease liabilities as of June 30, 2015 and December 31, 2014 are as follows and are included in current and non-current trade and other payables, net, in the accompanying consolidated statements of financial position:


In millions of won	June 30, 2015				December 31, 2014
	Minimum lease payments		Present value of minimum lease payments		Minimum lease payments		Present value of minimum lease payments

Less than 1 year	￦	183,441		112,908		184,809		109,374
1 ~ 5 years		572,646		426,630		619,828		459,302
More than 5 years		250,178		174,655		294,032		200,759


	￦	1,006,265		714,193		1,098,669		769,435

(3)

Current and non-current portion of financial lease liabilities as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015		December 31, 2014

Current finance lease liabilities	￦	112,908		109,374
Non-current finance lease liabilities		601,285		660,061


	￦	714,193		769,435

(4)

Lease payments recognized as an expense as a lessee for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015						June 30, 2014
	Three-month period ended			Six-month period ended			Three-month period ended			Six-month period ended

Minimum lease payment	￦	48,213			98,371			61,958			125,038
Contingent rent payment		(4,398	)		(8,886	)		(4,370	)		(8,977	)

(5)

The Company does not have any irrevocable operating lease contracts as of June 30, 2015 and December 31, 2014.

101

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

25.

Employment Benefits

(1)

Employment benefit obligations as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015		December 31, 2014

Net defined benefit obligations	￦	1,478,788		1,268,197
Other long-term employee benefit obligations		9,097		9,218


	￦	1,487,885		1,277,415

(2)

Principal assumptions on actuarial valuation as of June 30, 2015 and December 31, 2014 are as follows:


	June 30, 2015	December 31, 2014

Discount rate	2.72% ~ 3.02%	2.86% ~ 4.07%
Future salary and benefit levels	5.43%	5.42%
Weighted average duration	13.68 years	13.24 years

(3)

Details of expense relating to defined benefit plans for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015						June 30, 2014
	Three-month period ended			Six-month period ended			Three-month period ended			Six-month period ended

Current service cost	￦	77,322			154,171			77,446			153,753
Interest cost		15,767			30,892			25,375			51,181
Expected return on plan assets		(5,412	)		(10,836	)		(5,623	)		(11,226	)
Loss from settlement		(239	)		(239	)		—			—


	￦	87,438			173,988			97,198			193,708

Expenses as described above are recognized in those items below in the financial statements.


In millions of won	June 30, 2015				June 30, 2014
	Three-month period ended		Six-month period ended		Three-month period ended		Six-month period ended

Cost of sales	￦	59,298		123,561		71,439		140,755
Selling and administrative expenses		17,991		30,588		15,397		33,126
Others (Construction-in-progress and others)		10,149		19,839		10,362		19,827


	￦	87,438		173,988		97,198		193,708

In addition, for the six-month periods ended June 30, 2015 and 2014, employee benefit obligations expenses of ￦27,892 million and ￦18,925 million, respectively, is recognized as cost of sales, and ￦6,421 million and ￦1,748 million, respectively, is recognized as selling and administrative expenses, and ￦6,808 million and ￦6,503 million, respectively relates to the Company’s defined contribution plans.

102

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

25.

Employment Benefits, Continued

(4)

Details of defined benefit obligations as of December 31, 2013 and 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014

Present value of defined benefit obligation from funded plans	￦	2,203,374			1,992,447
Fair value of plan assets		(724,586	)		(724,250	)

		1,478,788			1,268,197

Present value of defined benefit obligation from unfunded plans		—			—


Net liabilities incurred from defined benefit plans	￦	1,478,788			1,268,197

(5)

Changes in the present value of defined benefit obligations for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014

Beginning balance	￦	1,992,447			2,629,057
Current service cost		154,171			291,115
Interest cost (*)		30,892			97,603
Remeasurement component		50,064			145,648
Past service cost		—			(167,998	)
Loss from settlement		(239	)		(62,292	)
Actual payments		(23,582	)		(941,208	)
Others		(379	)		522


Ending balance	￦	2,203,374			1,992,447

(*)	Corporate bond (AAA rated) yield at year-end is applied to the interest cost on employee benefit obligations.

(6)

Changes in the fair value of plan assets for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014

Beginning balance	￦	724,250			564,552
Expected return		10,836			22,291
Remeasurement component		(1,557	)		(6,602	)
Contributions by the employers		305			231,342
Actual payments		(8,738	)		(81,029	)
Assets decreased through settlement		—			(6,572	)
Others		(510	)		268


Ending balance	￦	724,586			724,250

In addition, loss on accumulated remeasurement component amounted to ￦152,181 million and ￦116,705 million and has been recognized as other comprehensive loss for the six-month period ended June 30, 2015 and for the year ended December 31, 2014, respectively.

103

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

25.

Employment Benefits, Continued

(7)

Details of the fair value of plan assets as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015		December 31, 2014

Equity instruments	￦	21,664		41,298
Debt instruments		183,496		163,528
Bank deposit		125,254		108,234
Others		394,172		411,190


	￦	724,586		724,250

For the six-month period ended June 30, 2015 and for the year ended December 31, 2014, actual returns on plan assets amounted to ￦9,279 million and ￦15,669 million, respectively.

(8)

Remeasurement component recognized in other comprehensive loss for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015		December 31, 2014

Actuarial gain from changes in financial assumptions	￦	24,462		218,859
Experience adjustments		25,602		(73,211	)
Expected return		1,557		6,602


	￦	51,621		152,250

Remeasurement component recognized as other comprehensive loss is recorded in retained earnings.

104

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

26.

Provisions

(1)

Provisions as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015				December 31, 2014
	Current		Non-current		Current		Non-current

Employment benefits	￦	736,407		15		707,310		—
Provision for employment benefits		736,407		15		707,310		—

Litigation		105,364		91,051		116,395		83,894
Litigation provisions		105,364		91,051		116,395		83,894

Decommissioning cost		—		12,387,959		—		13,434,606
Nuclear plants		—		9,266,359		—		10,331,270
Spent fuel		—		1,298,110		—		1,298,749
Waste		—		1,631,664		—		1,604,241
PCBs		—		190,981		—		199,518
Other recovery provisions		—		845		—		828

Others		699,888		10,993		450,481		10,510
Power plant regional support program		151,787		—		120,093		—
Transmission regional support program		177,481		—		—		—
Provisions for tax		—		136		—		649
Provisions for financial guarantee		2,280		4,184		74		3,621
Provisions for RPS		367,601		—		329,562		—
Others		739		6,673		752		6,240


	￦	1,541,659		12,490,018		1,274,186		13,529,010

(2)

Changes in provisions for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Beginning balance		Accretion expenses		Payment			Reversal			Other		Ending balance

Employment benefits	￦	707,310		371,291		(330,979	)		(11,200	)		—		736,422
Provision for employment benefits		707,310		371,291		(330,979	)		(11,200	)		—		736,422

Litigation		200,289		29,450		(25,625	)		(7,699	)		—		196,415
Litigation provisions		200,289		29,450		(25,625	)		(7,699	)		—		196,415

Decommissioning cost		13,434,606		535,955		(286,257	)		(1,296,580	)		235		12,387,959
Nuclear plants		10,331,270		231,961		(292	)		(1,296,580	)		—		9,266,359
Spent fuel		1,298,749		262,014		(262,653	)		—			—		1,298,110
Waste		1,604,241		38,188		(11,000	)		—			235		1,631,664
PCBs		199,518		3,775		(12,312	)		—			—		190,981
Other recovery provisions		828		17		—			—			—		845

Others		460,991		402,793		(136,128	)		(26,416	)		9,641		710,881
Power plant regional support program		120,093		37,569		(15,516	)		—			9,641		151,787
Transmission regional support program		—		238,353		(60,872	)		—			—		177,481
Provisions for tax		649		—		—			(513	)		—		136
Provisions for financial guarantee		3,695		3,396		—			(627	)		—		6,464
Provisions for RPS		329,562		122,936		(59,397	)		(25,500	)		—		367,601
Others		6,992		539		(343	)		224			—		7,412


	￦	14,803,196		1,339,489		(778,989	)		(1,341,895	)		9,876		14,031,677

105

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

26.

Provisions, Continued

(2)

Changes in provisions for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows, continued:


In millions of won	December 31, 2014
	Beginning balance		Accretion expenses		Payment			Reversal			Other		Ending balance

Employment benefits	￦	777,419		650,788		(615,230	)		(105,667	)		—		707,310
Provision for employment benefits		777,419		650,788		(615,230	)		(105,667	)		—		707,310

Litigation		23,720		200,593		(18,371	)		(5,653	)		—		200,289
Litigation provisions		23,720		200,593		(18,371	)		(5,653	)		—		200,289

Decommissioning cost		12,568,622		1,270,397		(398,600	)		(9,067	)		3,254		13,434,606
Nuclear plants		9,887,621		443,987		(338	)		—			—		10,331,270
Spent fuel		1,211,440		465,006		(377,697	)		—			—		1,298,749
Waste		1,249,062		351,935		(10	)		—			3,254		1,604,241
PCBs		219,704		9,436		(20,555	)		(9,067	)		—		199,518
Other recovery provisions		795		33		—			—			—		828

Others		346,371		350,049		(186,388	)		(65,264	)		16,223		460,991
Power plant regional support program		112,498		39,943		(44,242	)		—			11,894		120,093
Provisions for tax		649		—		—			—			—		649
Provisions for financial guarantee		8,789		476		(32	)		(5,538	)		—		3,695
Provisions for RPS		223,260		308,088		(142,096	)		(59,690	)		—		329,562
Others		1,175		1,542		(18	)		(36	)		4,329		6,992


	￦	13,716,132		2,471,827		(1,218,589	)		(185,651	)		19,477		14,803,196

27.

Government Grants

(1)

Government grants as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014

Land	￦	(3,103	)		(3,103	)
Buildings		(65,218	)		(67,700	)
Structures		(195,398	)		(196,871	)
Machinery		(107,738	)		(108,750	)
Vehicles		(48	)		(76	)
Equipment		(813	)		(1,002	)
Tools		(727	)		(862	)
Construction-in-progress		(115,287	)		(123,938	)
Investment properties		(13	)		(10	)
Software		(459	)		(488	)
Development expenditures		(7,328	)		(8,183	)
Intangible assets under development		(10,300	)		(10,692	)
Usage rights of donated assets and other		(37	)		(43	)
Others		(1	)		(1	)


	￦	(506,470	)		(521,719	)

106

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

27.

Government Grants, Continued

(2)

Changes in government grants for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Beginning balance			Receipt			Acquisition		Offset the items of depreciation expense and others		Disposal		Others			Ending balance

Cash	￦	—			(10,153	)		—		—		—		10,153			—
Land		(3,103	)		—			—		—		—		—			(3,103	)
Buildings		(67,700	)		—			—		2,516		—		(34	)		(65,218	)
Structures		(196,871	)		—			—		4,566		633		(3,726	)		(195,398	)
Machinery		(108,750	)		—			—		5,332		283		(4,603	)		(107,738	)
Vehicles		(76	)		—			—		27		1		—			(48	)
Equipment		(1,002	)		—			—		226		—		(37	)		(813	)
Tools		(862	)		—			—		135		—		—			(727	)
Construction-in-progress		(123,938	)		—			17,280		—		—		(8,629	)		(115,287	)
Investment properties		(10	)		—			—		—		—		(3	)		(13	)
Software		(488	)		—			—		84		—		(55	)		(459	)
Development expenditures		(8,183	)		—			—		1,651		—		(796	)		(7,328	)
Intangible assets under development		(10,692	)		—			1,663		—		—		(1,271	)		(10,300	)
Usage rights of donated assets and other		(43	)		—			—		5		—		1			(37	)
Others		(1	)		—			—		—		—		—			(1	)


	￦	(521,719	)		(10,153	)		18,943		14,542		917		(9,000	)		(506,470	)


In millions of won	December 31, 2014
	Beginning balance			Receipt			Acquisition		Offset the items of depreciation expense and others		Disposal		Others			Ending balance

Cash	￦	—			(108,681	)		—		—		—		108,681			—
Land		(3,137	)		—			—		—		63		(29	)		(3,103	)
Buildings		(45,396	)		—			—		5,040		200		(27,544	)		(67,700	)
Structures		(193,189	)		—			—		8,921		2,018		(14,621	)		(196,871	)
Machinery		(101,808	)		—			—		10,102		423		(17,467	)		(108,750	)
Vehicles		(83	)		—			—		47		—		(40	)		(76	)
Equipment		(707	)		—			—		376		—		(671	)		(1,002	)
Tools		(312	)		—			—		144		55		(749	)		(862	)
Construction-in-progress		(117,728	)		—			35,937		—		—		(42,147	)		(123,938	)
Investment properties		(13	)		—			—		4		—		(1	)		(10	)
Software		(428	)		—			—		154		—		(214	)		(488	)
Development expenditures		(11,705	)		—			—		4,125		—		(603	)		(8,183	)
Intangible assets under development		(7,792	)		—			527		—		170		(3,597	)		(10,692	)
Usage rights of donated assets and other		(53	)		—			—		10		—		—			(43	)
Others		(1	)		—			—		—		—		—			(1	)


	￦	(482,352	)		(108,681	)		36,464		28,923		2,929		998			(521,719	)

107

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

28.

Deferred Revenues

Deferred revenue related to the Company’s construction contracts as of June 30, 2015 and December 31, 2014 are as follows and included in current and non-current non-financial liabilities in the accompanying consolidated statements of financial position:


In millions of won	June 30, 2015			December 31, 2014

Beginning balance	￦	6,850,016			6,506,639
Increase during the current year / period		334,140			695,235
Recognized as revenue during the current year / period		(184,754	)		(351,858	)


Ending balance	￦	6,999,402			6,850,016

29.

Non-financial Liabilities

Non-financial liabilities as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015				December 31, 2014
	Current		Non-current		Current		Non-current

Advance received	￦	12,511,592		212,127		5,320,722		294,151
Unearned revenue		24,049		74,956		41,822		86,061
Deferred revenue		359,491		6,639,911		347,362		6,502,654
Withholdings		243,113		46,091		258,258		45,221
Others		582,096		18,346		496,192		18,323


	￦	13,720,341		6,991,431		6,464,356		6,946,410

108

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

30.

Contributed Capital

(1)

Details of shares issued as of June 30, 2015 and December 31, 2014 are as follows:

In millions of won except share information

June 30, 2015

Shares
authorized

Shares issued

Par value
per share

Owned by
government(*)

Owned by
others

Total

Common shares

1,200,000,000

641,964,077

￦

5,000

1,640,385

1,569,435

3,209,820

(*)	Korea Development Bank’s ownership of ￦1,056,176 million are included.

In millions of won except share information

December 31, 2014

Shares
authorized

Shares issued

Par value
per share

Owned by
government(*)

Owned by
others

Total

Common shares

1,200,000,000

641,964,077

￦

5,000

1,640,385

1,569,435

3,209,820

(*)	Korea Development Bank’s ownership of ￦960,800 million are included.

(2)

Details in number of outstanding capital stock for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows.


Number of shares	June 30, 2015		December 31, 2014

Beginning balance		641,964,077		623,034,082
Disposal of treasury stocks		—		18,929,995


Ending balance		641,964,077		641,964,077

(3)

Details of share premium as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015		December 31, 2014

Share premium	￦	843,758		843,758

109

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

31.

Retained Earnings and Dividends Paid

(1)

Details of retained earnings as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015		December 31, 2014

Legal reserve (*)	￦	1,604,910		1,604,910
Voluntary reserves		23,720,167		22,999,359
Retained earnings before appropriations		12,130,509		10,699,378


Retained earnings	￦	37,455,586		35,303,647

(*)

The KEPCO Act requires KEPCO to appropriate a legal reserve equal to at least 20 percent of net income for each accounting period until the reserve equals 50 percent of KEPCO’s common stock. The legal reserve is not available for cash dividends; however, this reserve may be credited to paid-in capital or offset against accumulated deficit by the resolution of the shareholders.

(2)

Details of voluntary reserves as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015		December 31, 2014

Reserve for investment on social overhead capital	￦	5,277,449		5,277,449
Reserve for research and human development (*)		330,000		330,000
Reserve for business expansion		17,902,718		17,181,910
Reserve for equalizing dividends		210,000		210,000


	￦	23,720,167		22,999,359

(*)	The reserve for research and human development is appropriated by the Company to use as qualified tax credits to reduce corporate tax liabilities. The reserve is available for cash dividends for a certain period as defined by the Tax Incentive Control Law of Korea.

(3)

Changes in retained earnings for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014

Beginning balance	￦	35,303,647			32,766,086
Net profit for the period attributed to owner of the Company		2,505,266			2,686,873
Changes in equity method retained earnings		1,230			(1,899	)
Remeasurement of defined benefit liability (asset), net of tax		(33,575	)		(91,340	)
Dividend paid		(320,982	)		(56,073	)


Ending balance	￦	37,455,586			35,303,647

(4)

Dividends paid for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:

In millions of won

June 30, 2015

Number of
shares issued

Number of
treasury stocks

Number of
shares eligible for
dividends

Dividends paid
per share
(In won)

Dividends
paid

Common shares

641,964,077

—

641,964,077

￦

500

320,982

In millions of won

December 31, 2014

Number of
shares issued

Number of
treasury stocks

Number of
shares eligible for
dividends

Dividends paid
per share
(In won)

Dividends
paid

Common shares

641,964,077

18,929,995

623,034,082

￦

56,073

110

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

31.

Retained Earnings and Dividends Paid, Continued

(5)

Changes in retained earnings of investments in associates and joint ventures for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014

Beginning balance	￦	(2,131	)		(232	)
Changes		1,230			(1,899	)
Income tax effect		—			—


Ending balance	￦	(901	)		(2,131	)

(6)

Changes in remeasurement components related to defined benefit liability for the six-month period June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014

Beginning balance	￦	(116,705	)		39,591
Changes		(52,508	)		(151,610	)
Income tax effect		18,933			60,270
Transfer to reserve for business expansion		(1,902	)		(64,956	)


Ending balance	￦	(152,182	)		(116,705	)

32.

Hybrid Bonds

Korea Western Power Co., Ltd. and Korea South-East Power Co., Ltd., which are wholly owned subsidiaries of the Company, issued bond-type hybrid securities for the year ended December 31, 2012. Bond-type hybrid securities classified as equity (non-controlling interest) as of June 30, 2015 are as follows:


In millions of won
Issuer	Hybrid Bond	Issued date		Maturity		Yield (%)	Amount

Korea Western Power Co., Ltd.	1st bond-type hybrid bond		2012.10.18		2042.10.18	5yr government bond rate + 1.20	￦	100,000
Korea South-East Power Co., Ltd.	1st bond-type hybrid bond		2012.12.07		2042.12.06	4.38		170,000
Korea South-East Power Co., Ltd.	2nd bond-type hybrid bond		2012.12.07		2042.12.06	4.44		230,000

Expense of Issuance								(1,340	)


							￦	498,660

Although these instruments have contractual maturity dates, the contractual agreements allow these subsidiaries to indefinitely extend the maturity dates and defer the payment of interest without modification to the other terms of the instruments. When the Company decides to not pay dividends on ordinary shares, they are not required to pay interest on the hybrid bonds.

Substantially, as these instruments have no contractual obligation to pay principal and interest, these instruments have been classified as equity (non-controlling interest) in the Company’s consolidated financial statements.

111

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

33.

Other Components of Equity

(1)

Other components of equity of the parent as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014

Other capital surpluses	￦	1,198,374			1,151,402
Accumulated other comprehensive loss		(183,400	)		(202,269	)
Other equity		13,294,973			13,294,973


	￦	14,309,947			14,244,106

(2)

Changes in other capital surpluses for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015								December 31, 2014
	Gain on disposal of treasury stocks		Others			Subtotal			Gain on disposal of treasury stocks			Others			Subtotal

Beginning balance	￦	387,524		763,878			1,151,402			303,028			527,954			830,982
Disposal of subsidiary		—		58,172			58,172			—			313,117			313,117
Disposal of treasury stocks		—		—			—			111,473			—			111,473
Issuance of share capital of subsidiary		—		2,865			2,865			—			(1,235	)		(1,235	)
Income tax effect		—		(14,065	)		(14,065	)		(26,977	)		(75,958	)		(102,935	)


Ending balance	￦	387,524		810,850			1,198,374			387,524			763,878			1,151,402

112

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

33.

Other Components of Equity, Continued

(3)

Changes in accumulated other comprehensive loss for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Available-for-sale financial asset valuation reserve			Shares in other comprehensive income of investments in associates and joint ventures		Reserve for overseas operations translation credit			Reserve for gain (loss) on valuation of derivatives			Total

Beginning balance	￦	(34,649	)		186,897		(255,641	)		(98,876	)		(202,269	)
Changes in the unrealized fair value of available- for-sale financial assets, net of tax		22,905			—		—			—			22,905
Shares in other comprehensive income of associates and joint ventures, net of tax		—			34,922		—			—			34,922
Foreign currency translation of foreign operations, net of tax		—			—		(21,083	)		—			(21,083	)
Net change in the unrealized fair value of derivatives using cash flow hedge accounting, net of tax		—			—		—			(17,875	)		(17,875	)


Ending balance	￦	(11,744	)		221,819		(276,724	)		(116,751	)		(183,400	)


In millions of won	December 31, 2014
	Available-for-sale financial asset valuation reserve			Shares in other comprehensive income of investments in associates and joint ventures		Reserve for overseas operations translation credit			Reserve for gain (loss) on valuation of derivatives			Total

Beginning balance	￦	62,614			182,261		(170,679	)		(18,658	)		55,538
Changes in the unrealized fair value of available- for-sale financial assets, net of tax		(97,263	)		—		—			—			(97,263	)
Shares in other comprehensive income of associates and joint ventures, net of tax		—			4,636		—			—			4,636
Foreign currency translation of foreign operations, net of tax		—			—		(84,962	)		—			(84,962	)
Net change in the unrealized fair value of derivatives using cash flow hedge accounting, net of tax		—			—		—			(80,218	)		(80,218	)


Ending balance	￦	(34,649	)		186,897		(255,641	)		(98,876	)		(202,269	)

(4)

Changes in treasury stocks for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015				December 31, 2014
	Shares		Amount		Shares			Amount

Beginning balance	￦	—		—		18,929,995			(741,489	)
Disposal of treasury stocks		—		—		(18,929,995	)		741,489


Ending balance	￦	—		—		—			—

(5)

Changes in other equity for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014

Statutory revaluation reserve	￦	13,295,098			13,295,098
Changes in other equity		(125	)		(125	)


	￦	13,294,973			13,294,973

113

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

34.

Sales

Details of sales for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015
	Domestic				Overseas				Total
	Three-month period ended		Six-month period ended		Three-month period ended		Six- month period ended		Three-month period ended		Six-month period ended

Sales of goods	￦	12,182,113		26,312,234		82,378		185,241		12,264,491		26,497,475
Electricity		12,029,496		25,893,559		—		—		12,029,496		25,893,559
Heat supply		15,726		144,286		—		—		15,726		144,286
Others		136,891		274,389		82,378		185,241		219,269		459,630
Sales of service		51,458		96,396		70,125		119,975		121,583		216,371
Sales of construction services		51,373		92,356		1,141,203		1,804,729		1,192,576		1,897,085
Revenue related to transfer of assets from customers		93,176		184,754		—		—		93,176		184,754


	￦	12,378,120		26,685,740		1,293,706		2,109,945		13,671,826		28,795,685


In millions of won	June 30, 2014
	Domestic				Overseas				Total
	Three-month period ended		Six-month period ended		Three-month period ended		Six-month period ended		Three-month period ended		Six-month period ended

Sales of goods	￦	11,761,465		25,772,883		68,561		130,719		11,830,026		25,903,602
Electricity		11,624,836		25,371,363		—		—		11,624,836		25,371,363
Heat supply		22,677		152,252		—		—		22,677		152,252
Others		113,952		249,268		68,561		130,719		182,513		379,987
Sales of service		64,602		93,424		78,284		114,040		142,886		207,464
Sales of construction services		56,988		95,633		772,233		1,282,336		829,221		1,377,969
Revenue related to transfer of assets from customers		87,166		172,911		—		—		87,166		172,911


	￦	11,970,221		26,134,851		919,078		1,527,095		12,889,299		27,661,946

114

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

35.

Selling and Administrative Expenses

Selling and administrative for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015						June 30, 2014
	Three- month period ended			Six- month period ended			Three- month period ended		Six- month period ended

Salaries	￦	149,536			310,148			132,556		273,439
Retirement benefit expense		15,170			30,238			16,270		34,902
Welfare and benefit expense		34,390			57,425			23,895		47,119
Insurance expense		2,722			5,385			2,859		5,739
Depreciation		24,075			47,861			16,300		32,767
Amortization of intangible assets		10,218			21,826			10,053		20,762
Bad debt expense (reversal)		(5,893	)		(17,471	)		12,127		12,628
Commission		166,025			300,868			150,610		273,124
Advertising expense		8,199			13,779			5,796		10,282
Training expense		1,048			2,158			1,191		2,364
Vehicle maintenance expense		2,760			5,114			3,019		5,853
Publishing expense		686			1,236			677		1,358
Business promotion expense		963			1,719			789		1,582
Rent expense		9,224			19,356			7,334		15,768
Telecommunication expense		5,907			11,933			5,058		11,346
Transportation expense		159			300			94		178
Taxes and dues		36,978			39,565			59,926		66,926
Expendable supplies expense		1,250			3,261			854		1,755
Water, light and heating expense		2,118			5,567			2,289		4,983
Repairs and maintenance expense		10,476			15,379			6,224		13,183
Ordinary development expense		40,163			73,704			34,747		69,577
Travel expense		3,497			7,503			2,800		6,011
Clothing expense		1,151			1,208			2,511		2,613
Survey and analysis expense		140			283			124		271
Membership fee		247			670			251		602
Promotion expense		—			7			—		—
Others		31,334			55,345			25,117		44,188


	￦	552,543			1,014,367			523,471		959,320

115

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

36.

Other Income and Expense

(1)

Other income for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015				June 30, 2014
	Three- month period ended		Six- month period ended		Three- month period ended		Six- month period ended

Reversal of other provisions	￦	5,076		6,734		1,782		3,842
Reversal of allowance for doubtful accounts		—		—		14		14
Gains on assets contributed		880		3,092		—		20
Gains on liabilities exempted		34		2,371		18		800
Compensation and reparations revenue		34,319		86,856		10,475		21,391
Gains on electricity infrastructure development fund		220		363		12,997		14,955
Revenue from research contracts		1,394		4,531		2,651		3,026
Rental income		47,528		95,786		42,787		91,268
Others		6,879		13,962		4,234		10,365


	￦	96,330		213,695		74,958		145,681

(2)

Other expense for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015				June 30, 2014
	Three- month period ended		Six- month period ended		Three- month period ended		Six- month period ended

Accretion expenses of other provisions	￦	272		316		24		129
Depreciation expenses on investment properties		185		347		234		417
Depreciation expenses on idle assets		1,666		3,332		1,667		3,330
Other bad debt expense		5,168		12,983		5,801		17,671
Donations		4,742		17,162		2,822		9,849
Others		4,947		5,977		3,750		5,961


	￦	16,980		40,117		14,298		37,357

116

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

37.

Other Gains (Losses)

Composition of other gains (losses) for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015						June 30, 2014
	Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended

Other gains
Gains on disposal of property plant, and equipment	￦	78,854			96,769			25,092			32,508
Gains on disposal of intangible assets		32			32			—			—
Gains on foreign currency translation		1,823			2,984			2,994			5,501
Gains on foreign currency transaction		10,999			19,798			14,994			25,908
Insurance proceeds		25			25			3,046			3,046
Others		26,786			78,513			39,285			92,191

Other losses
Losses on disposal of property plant and equipment		(28,689	)		(41,044	)		(7,197	)		(10,141	)
Losses on disposal of intangible assets		—			(5	)		(17	)		(17	)
Impairment loss on property, plant and equipment		(1,205	)		(1,205	)		—			—
Losses on foreign currency translation		(3,472	)		(9,978	)		(3,812	)		(5,431	)
Losses on foreign currency transaction		(23,864	)		(35,632	)		(11,202	)		(24,878	)
Others		(14,048	)		(37,122	)		(13,788	)		(28,210	)


	￦	47,241			73,135			49,395			90,477

117

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

38.

Finance Income

(1)

Finance income for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015				June 30, 2014
	Three- month period ended		Six- month period ended		Three- month period ended		Six- month period ended

Interest income	￦	55,515		105,008		49,810		98,005
Dividends income		8,107		13,564		1,022		13,547
Gains on valuation of derivatives		160,714		239,814		2,317		8,580
Gains on transaction of derivatives		6,693		13,653		799		38,214
Gains on foreign currency translation		39,297		64,084		578,508		441,738
Gains on foreign currency transaction		5,099		12,186		48,888		55,864
Others		41		64		—		—


	￦	275,466		448,373		681,344		655,948

(2)

Interest income included in finance income for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015				June 30, 2014
	Three- month period ended		Six- month period ended		Three- month period ended		Six- month period ended

Cash and cash equivalents	￦	13,297		25,188		14,600		26,835
Available-for-sale financial assets		—		29		110		218
Held-to-maturity investments		24		48		21		38
Loans and receivables		4,400		11,174		8,981		16,929
Short-term financial instrument		5,668		8,532		1,142		3,148
Long-term financial instrument		2,643		5,572		81		191
Trade and other receivables		29,483		54,465		24,875		50,646


	￦	55,515		105,008		49,810		98,005

118

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

39.

Finance Expenses

(1)

Finance expenses for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015				June 30, 2014
	Three- month period ended		Six- month period ended		Three- month period ended		Six- month period ended

Interest expense	￦	525,807		1,078,463		596,721		1,193,767
Losses on sale of financial assets		2,008		2,983		—		2
Impairment of available-for-sale financial assets		8,172		13,993		41,792		41,792
Losses on valuation of derivatives		8,583		22,920		542,768		405,385
Losses on transaction of derivatives		9,909		19,323		63,008		88,287
Losses on foreign currency translation		222,763		303,946		31,521		40,316
Losses on foreign currency transaction		5,760		8,474		8,262		13,190
Losses on repayment of financial liabilities		—		—		199		199
Others		39		63		—		—


	￦	783,041		1,450,165		1,284,271		1,782,938

(2)

Interest expense included in finance expenses for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015						June 30, 2014
	Three- month period ended			Six- month period ended			Three- month period ended			Six- month period ended

Trade and other payables	￦	24,211			45,120			24,764			47,140
Short-term borrowings		4,647			7,937			11,156			15,678
Long-term borrowings		23,463			55,914			45,841			90,265
Debt securities		540,967			1,096,019			572,651			1,162,503
Other financial liabilities		151,143			303,686			145,782			292,905

		744,431			1,508,676			800,194			1,608,491


Less: Capitalized borrowing costs		(218,624	)		(430,213	)		(203,473	)		(414,724	)


	￦	525,807			1,078,463			596,721			1,193,767

Capitalization rates for the six-month periods ended June 30, 2015 and 2014 are 2.71% ~ 4.22% and 3.32% ~ 4.11%, respectively.

119

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

40.

Income Taxes

(1)

Income tax expense for the six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won
	June 30, 2015			June 30, 2014
Current income tax expense
Payment of income tax	￦	566,854			583,864
Adjustment due to changes in estimates related to prior years		(33,971	)		(19,200	)
Current income tax directly recognized in equity		3,440			76,300

		536,323			640,964

Deferred income tax expense
Generation and realization of temporary differences		9,105			(40,615	)
Changes of unrecognized tax losses, tax credit and temporary differences for prior periods		65,138			(3,181	)
Changes in deferred tax on tax losses incurred during the period		612,970			(36,295	)
Tax credit carry forwards		3,266			16,819

		690,479			(63,272	)


Income tax expense	￦	1,226,802			577,692

(2)

Reconciliation between actual income tax expense (benefit) and amount computed by applying the statutory tax rate of 24.2% to income before income tax for the six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won
	June 30, 2015			June 30, 2014

Income before income tax	￦	3,791,803			1,330,475

Income tax expense computed at applicable tax rate of 24.2%		917,616			321,975

Adjustments
Additional payment of income taxes or receipt of income tax refunds		(6,308	)		2,278
Effect of applying gradual tax rate		(1,397	)		4,689
Effect of non-taxable income		(74,841	)		(31,124	)
Effect of non-deductible expenses		84,491			6,688
Effects of tax credits and deduction		(5,351	)		(13,364	)
Recognition (reversal) of unrecognized deferred tax, net		64,448			(3,571	)
Deferred income tax related to investments in subsidiaries and associates		272,782			306,630
Others, net		(24,638	)		(16,509	)

		309,186			255,717


Income tax expense	￦	1,226,802			577,692


Effective tax rate		32.4	%		43.4	%

120

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

40.

Income Taxes, Continued

(3)

Income tax directly adjusted to shareholders’ equity (except for accumulated other comprehensive loss) for the six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015			June 30, 2014

Dividends of hybrid securities	￦	2,612			2,612
Loss on disposal of investments in subsidiaries		(14,065	)		—


	￦	(11,453	)		2,612

(4)

Income tax recognized as other comprehensive loss for the six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015			June 30, 2014

Income tax recognized as other comprehensive income (loss)
Gain (loss) on valuation of available-for-sale financial assets	￦	(11,763	)		11,154
Net change in the unrealized fair value of derivatives using cash flow hedge accounting, net of tax		9,951			19,659
Remeasurements of defined benefit obligations		18,933			42,197
Investments in associates		(559	)		585
Others		(1,669	)		93


	￦	14,893			73,688

121

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

40.

Income Taxes, Continued

(5)

Changes in deferred income tax assets (liabilities) recognized in the statements of financial position for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015
	Beginning balance			Amounts recognized in profit or loss			Amount recognized in other comprehensive income			Amounts recognized directly in equity			Ending balance
Deferred income tax on temporary differences
Employee benefits	￦	352,934			33,932			18,933			—			405,799
Cash flow hedge		51,355			(30,999	)		9,951			—			30,307
Investments in associates or subsidiaries		(5,769,627	)		(210,292	)		(2,228	)		(14,065	)		(5,996,212	)
Property, plant and equipment		(5,979,862	)		188,650			—			—			(5,791,212	)
Finance lease		(197,097	)		(6,072	)		—			—			(203,169	)
Intangible assets		12,309			(2,582	)		—			—			9,727
Financial assets at fair value through profit or loss		2,840			2,411			—			—			5,251
Available-for-sale financial assets		(41,836	)		(10,996	)		(11,763	)		—			(64,595	)
Deferred revenue		230,644			3,211			—			—			233,855
Provisions		3,459,775			(217,446	)		—			—			3,242,329
Doubtful receivables		1,356			(6	)		—			—			1,350
Other finance liabilities		23,236			889			—			2,612			26,737
Gains (losses) on foreign exchange translation		53,794			31,595			—			—			85,389
Allowance for doubtful accounts		15,452			5,013			—			—			20,465
Accrued income		(3,246	)		(2,239	)		—			—			(5,485	)
Special deduction for property, pleant and equipment		(194,674	)		2			—			—			(194,672	)
Impairment of non-current assets		86,720			—			—			—			86,720
Reserve for research and human development		(35,499	)		6,836			—			—			(28,663	)
Others		460,019			113,681			—			—			573,700

		(7,471,407	)		(94,412	)		14,893			(11,453	)		(7,562,379	)

Deferred income tax on unused tax losses and tax credit
Tax losses		2,176,175			(555,619	)		—			—			1,620,556
Tax credit		98,286			(43,888	)		—			—			54,398

		2,274,461			(599,507	)		—			—			1,674,954


	￦	(5,196,946	)		(693,919	)		14,893			(11,453	)		(5,887,425	)

122

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

40.

Income Taxes, Continued

(5)

Changes deferred income tax assets (liabilities) recognized in the statements of financial position for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows, continued:


In millions of won	December 31, 2014
	Beginning balance			Amounts recognized in profit or loss			Amount recognized in other comprehensive income			Amounts recognized directly in equity			Ending balance
Deferred income tax on temporary differences
Employee benefits	￦	518,681			(218,342	)		52,595			—			352,934
Cash flow hedge		51,991			(51,674	)		51,038			—			51,355
Investments in associates or subsidiaries		(5,227,034	)		(435,528	)		(31,107	)		(75,958	)		(5,769,627	)
Property, plant and equipment		(6,061,613	)		81,751			—			—			(5,979,862	)
Finance lease		(142,081	)		(55,016	)		—			—			(197,097	)
Intangible assets		10,242			2,067			—			—			12,309
Financial assets at fair value through profit or loss		83,645			(80,805	)		—			—			2,840
Available-for-sale financial assets		(101,088	)		33,104			26,148			—			(41,836	)
Deferred revenue		244,806			(14,162	)		—			—			230,644
Provisions		3,150,908			308,867			—			—			3,459,775
Doubtful receivables		59			1,297			—			—			1,356
Other finance liabilities		25,856			(7,876	)		—			5,256			23,236
Gains (losses) on foreign exchange translation		(19,164	)		72,958			—			—			53,794
Allowance for doubtful accounts		7,314			8,138			—			—			15,452
Accrued income		(1,248	)		(1,998	)		—			—			(3,246	)
Special deduction for property, plant and equipment		(194,785	)		111			—			—			(194,674	)
Impairment of non-current assets		86,720			—			—			—			86,720
Treasury stocks		—			26,976			—			(26,976	)		—
Reserve for research and human development		(43,143	)		7,644			—			—			(35,499	)
Others		409,436			42,442			8,141			—			460,019

		(7,200,498	)		(280,046	)		106,815			(97,678	)		(7,471,407	)

Deferred income tax on unused tax losses and tax credit
Tax losses		2,501,349			(325,174	)		—			—			2,176,175
Tax credit		56,099			42,187			—			—			98,286

		2,557,448			(282,987	)		—			—			2,274,461


	￦	(4,643,050	)		(563,033	)		106,815			(97,678	)		(5,196,946	)

(6)

Deferred income tax assets (liabilities) recognized in the statements of financial position as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014

Deferred income tax assets	￦	628,931			526,934
Deferred income tax liabilities		(6,516,356	)		(5,723,880	)


	￦	(5,887,425	)		(5,196,946	)

(7)

Details of deductible temporary differences, tax losses and unused tax credits not recognized in the deferred income tax assets as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015		December 31, 2014

Deductible temporary differences	￦	440,351		448,402

123

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

41.

Assets Held-for-Sale

Assets held-for-sale as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015		December 31, 2014

Land (*1,2)	￦	2,021,445		2,021,445
Building (*1,2)		69,363		69,363
Structures (*2)		2		2


	￦	2,090,810		2,090,810

(*1)

The Company moved its headquarters to Naju, Jeollanam-do, in November 2014 as part of the government’s plan to relocate state-run companies for balanced national development. Hyundai Motor and two of its affiliates won the bid to buy the buildings and land of the Company’s headquarters by offering ￦10.55 trillion. The total sale value amounted to ￦10.55 trillion and the ownership is expected to be transferred on September 25, 2015. The Company reclassified the buildings and land as held-for-sales assets when the construction of the Naju headquarters was completed and also, the Company recognized contract deposit amounting to ￦7.39 trillion as advance received as of June 30, 2015.

(*2)

KEPCO Plant Service & Engineering Co., Ltd., a subsidiary of the Company, moved its headquarters to Naju, Jeollanam-do, in November as part of the government’s plan to relocate state-run companies for balanced national development and plans to sell its head office in Seongnam to fund costs regarding relocation through Korea Asset Management Corporation’s online auction site (The On-Bid system). The total sale value amounted to ￦71 billion and the ownership is expected to be transferred on August 31, 2015. The Company recognized contract deposit amounted to ￦10 billion as advance received as of June 30, 2015.

124

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

42.

Expenses Classified by Nature

Expenses classified by nature for the six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015
	Selling and administrative expenses			Cost of sales		Total

Raw materials used	￦	—			7,768,317		7,768,317
Salaries		310,148			1,396,119		1,706,267
Retirement benefit expense		30,238			158,224		188,462
Welfare and benefit expense		57,425			231,502		288,927
Insurance expense		5,385			41,454		46,839
Depreciation		47,861			3,952,072		3,999,933
Amortization of intangible assets		21,826			15,821		37,647
Bad debt expense (reversal)		(17,471	)		—		(17,471	)
Commission		300,868			164,648		465,516
Advertising expense		13,779			3,074		16,853
Training expense		2,158			3,807		5,965
Vehicle maintenance expense		5,114			4,200		9,314
Publishing expense		1,236			1,748		2,984
Business promotion expense		1,719			1,953		3,672
Rent expense		19,356			65,416		84,772
Telecommunication expense		11,933			36,859		48,792
Transportation expense		300			2,704		3,004
Taxes and dues		39,565			214,914		254,479
Expendable supplies expense		3,261			12,903		16,164
Water, light and heating expense		5,567			13,359		18,926
Repairs and maintenance expense		15,379			808,114		823,493
Ordinary development expense		73,704			188,948		262,652
Travel expense		7,503			25,957		33,460
Clothing expense		1,208			1,509		2,717
Survey and analysis expense		283			1,178		1,461
Membership fee		670			5,847		6,517
Power purchase		—			6,186,371		6,186,371
Others		55,352			2,146,450		2,201,802


	￦	1,014,367			23,453,468		24,467,835

125

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

42.

Expenses Classified by Nature, Continued

Expenses classified by nature for the six-month periods ended June 30, 2015 and 2014 are as follows, continued:


In millions of won	June 30, 2014
	Selling and administrative expenses		Cost of sales		Total

Raw materials used	￦	—		10,505,095		10,505,095
Salaries		273,439		1,290,934		1,564,373
Retirement benefit expense		34,902		160,100		195,002
Welfare and benefit expense		47,119		170,645		217,764
Insurance expense		5,739		32,823		38,562
Depreciation		32,767		3,760,760		3,793,527
Amortization of intangible assets		20,762		18,467		39,229
Bad debt expense		12,628		—		12,628
Commission		273,124		155,702		428,826
Advertising expense		10,282		2,572		12,854
Training expense		2,364		3,768		6,132
Vehicle maintenance expense		5,853		4,395		10,248
Publishing expense		1,358		1,556		2,914
Business promotion expense		1,582		1,909		3,491
Rent expense		15,768		63,365		79,133
Telecommunication expense		11,346		33,835		45,181
Transportation expense		178		1,598		1,776
Taxes and dues		66,926		116,601		183,527
Expendable supplies expense		1,755		11,284		13,039
Water, light and heating expense		4,983		14,352		19,335
Repairs and maintenance expense		13,183		613,042		626,225
Ordinary development expense		69,577		177,019		246,596
Travel expense		6,011		23,080		29,091
Clothing expense		2,613		669		3,282
Survey and analysis expense		271		1,075		1,346
Membership fee		602		5,447		6,049
Power purchase		—		5,978,739		5,978,739
Others		44,188		1,497,477		1,541,665


	￦	959,320		24,646,309		25,605,629

126

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

43.

Earnings Per Share

(1)

Basic earnings per share for the three and six-month periods ended June 30, 2015 and 2014 are as follows:

In won

Type

June 30, 2015

June 30, 2014

Three-
month
period
ended

Six-
month
period
ended

Three-
month
period
ended

Six-
month
period
ended

Basic earnings per share

￦

2,034

3,903

248

1,103

(2)

Diluted earnings per share for the three and six-month periods ended June 30, 2015 and 2014 are as follows:

In won

Type

June 30, 2015

June 30, 2014

Three-
month
period
ended

Six-
month
period
ended

Three-
month
period
ended

Six-
month
period
ended

Diluted earnings per share

￦

2,034

3,903

248

1,103

(3)

Basic earnings per share

Net profit for the period and weighted average number of common shares used in the calculation of basic earnings per share for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won except number of shares
Type	June 30, 2015				June 30, 2014
Type	Three- month period ended		Six- month period ended		Three- month period ended		Six- month period ended

Controlling interest in net income	￦	1,305,183		2,505,266		154,752		687,014
Income used in the calculation of total basic earnings per share		1,305,183		2,505,266		154,752		687,014
Weighted average number of common shares		641,964,077		641,964,077		623,034,082		623,034,082

(4)

Diluted earnings per share

Diluted earnings per share is calculated by applying adjusted weighted average number of common shares under the assumption that all dilutive potential common shares are converted to common shares.

Profit used in the calculation of total diluted earnings perform the three and six-month periods ended June 30, 2015 and 2014 are as follows:

In millions of won

Type

June 30, 2015

June 30, 2014

Three-
month
period
ended

Six-
month
period
ended

Three-
month
period
ended

Six-
month
period
ended

Earnings used in the calculation of total diluted earnings per share

￦

1,305,183

2,505,266

154,752

687,014

127

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

43.

Earnings Per Share, Continued

(4)

Diluted earnings per share, continued:

Weighted average common shares used in calculating diluted earnings per share are adjusted from weighted average common shares used in calculating basic earnings per share. Detailed information of the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In number of shares
Type	June 30, 2015				June 30, 2014
Type	Three- month period ended		Six- month period ended		Three- month period ended		Six- month period ended

Weighted average number of common shares		641,964,077		641,964,077		623,034,082		623,034,082
Diluted weighted average number of shares		641,964,077		641,964,077		623,034,082		623,034,082

(5)

There are no potential dilutive instruments and diluted earnings per shares are same as basic earnings per share for the three and six-month periods ended June 30, 2015 and 2014.

128

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

44.

Risk Management

(1)

Capital risk management

The Company manages its capital to ensure that entities in the Company will be able to continue while maximizing the return to shareholder through the optimization of the debt and equity balance. The capital structure of the Company consists of net debt (offset by cash and cash equivalents) and equity. The Company’s overall capital risk management strategy remains unchanged from that of the prior year.

Details of the Company’s capital management accounts as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015			December 31, 2014

Total borrowings and debt securities	￦	60,791,891			62,824,327
Cash and cash equivalents		(3,850,438	)		(1,796,300	)

Net borrowings and debt securities		56,941,453			61,028,027

Total shareholder’s equity		57,053,286			54,825,010

Debt to equity ratio		99.80	%		111.31	%

(2)

Financial risk management

The Company is exposed to various risks related to its financial instruments, such as, market risk (currency risk, interest rate risk, price risk), credit risk. The Company monitors and manages the financial risks relating to the operations of the Company through internal risk reports which analyze exposures by degree and magnitude of risks. The Company uses derivative financial instruments to certain hedge risk exposures. The Company’s overall financial risk management strategy remains unchanged from that of the prior year.

(i)

Credit risk

Credit risk is the risk of finance loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises primarily from the sales activities, securities and derivatives. In addition, credit risk exposure may exist within financial guarantees and unused line of credits. As these financial institutions the Company makes transactions with are reputable financial institutions, the credit risk from them are considered limited. The Company decides credit transaction limits based on evaluation of client’s credit, through information obtained from the credit bureau and disclosed financial position at committing contracts.

①

Credit risk management

Electricity sales, the main operations of the Company are the necessity for daily life and industrial activities of Korean nationals, and have importance as one of the national key industries. The Company dominates the domestic market supplying electricity to customers. The Company is not exposed to credit risk as customers of the Company are from various industries and areas. The Company uses publicly available information and its own internal data related to trade receivables, to rate its major customers and to measure the credit risk that a counter party will default on a contractual obligation. For the incurred but not recognized loss, it is measured considering overdue period.

②

Impairment and allowance account

In accordance with the Company policies, individual material financial assets are assessed on a regular basis, trade receivables that are assessed not to be impaired individually are, in addition, assessed for impairment on a collective basis. Value of the acquired collateral (including the confirmation of feasibility) and estimated collectable amounts are included in this assessment.

Allowance for bad debts assessed on a collective basis are recognized for (i) the group of assets which individually are not material and (ii) incurred but not recognized losses that are assessed using statistical methods, judgment and past experience.

129

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

44.

Risk Management, Continued

(2)

Financial risk management, continued

Book values of the financial assets represent the maximum exposed amounts of the credit risk. Details of the Company’s level of maximum exposure to credit risk as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015		December 31, 2014

Cash and cash equivalents	￦	3,850,438		1,796,300
Derivative assets (trading)		83,841		65,849
Available-for-sale financial assets		720,196		715,151
Held-to-maturity investments		3,387		3,614
Loans and receivables		689,325		623,997
Long-term/short-term financial instruments		2,190,368		704,462
Derivative assets (using hedge accounting)		218,482		104,276
Trade and other receivables		8,445,752		9,422,219
Financial guarantee contracts (*)		291,669		148,522

(*)	Maximum exposure associated with the financial guarantee contracts is the maximum amounts of the obligation.

Financial guarantee contracts as of June 30, 2015 are as follows:


In thousands of U.S. dollars
Type	Company	Currency	Amounts

Joint ventures	KEPCO SPC Power Corporation	USD		116,368
Joint ventures	PT. Tanjung Power Indonesia	USD		10,500
Joint ventures	Kelar S.A	USD		132,600


				259,468

As of the reporting date, there are no financial assets and non-financial assets that were acquired through the exercise of the right of collateralized assets and reinforcement of credit arrangement.

(ii)

Market risk

Market risk is the risk that the Company’s fair values of the financial instruments or future cash flows are affected by the changes in the market. Market risk consists of interest rate risk, currency risk and other price risk.

130

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

44.

Risk Management, Continued

(2)

Financial risk management, continued

(iii)

Sensitivity analysis

Significant assets and liabilities with uncertainties in underlying assumptions

①

Defined benefit obligation

The following is a sensitivity analysis of defined benefit obligation assuming a 1% increase and decrease movements in the actuarial valuation assumptions as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won		June 30, 2015						December 31, 2014
Type	Accounts	1% Increase			1% Decrease			1% Increase			1% Decrease

Future salary increases	Increase (decrease) in defined benefit obligation	￦	291,139			(252,564	)		244,516			(222,706	)
Discount rate	Increase (decrease) in defined benefit obligation		(242,976	)		298,674			(221,728	)		260,991

Changes of employee benefits assuming a 1% increase and decrease movements in discount rate on plan asset for the six-month periods ended June 30, 2015 and 2014 are ￦3,620 million and ￦2,826 million, respectively.

②

Provisions

Changes in provisions due to movements in underlying assumptions as of June 30, 2015 and December 31, 2014 are as follows:


Type	Accounts	June 30, 2015			December 31, 2014

PCBs	Inflation rate		2.79	%		2.79	%
	Discount rate		3.78	%		3.78	%
Nuclear plants	Inflation rate		1.40	%		2.93	%
	Discount rate		3.55	%		4.49	%
Spent fuel	Inflation rate		2.93	%		2.93	%
	Discount rate		4.49	%		4.49	%

The following is a sensitivity analysis of provisions assuming a 0.1% increase and decrease movements in the underlying assumptions as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won		June 30, 2015						December 31, 2014
Type	Accounts	0.1% Increase			0.1% Decrease			0.1% Increase			0.1% Decrease

Discount rate	PCBs	￦	(978	)		986			(1,058	)		1,066
	Nuclear plants		(191,617	)		196,640			(221,795	)		227,773
	Spent fuel		(49,459	)		51,379			(49,483	)		51,404
Inflation rate	PCBs		1,096			(1,089	)		1,076			(1,069	)
	Nuclear plants		205,334			(200,294	)		251,588			(244,964	)
	Spent fuel		52,121			(50,242	)		52,147			(50,267	)

131

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

44.

Risk Management, Continued

(2)

Financial risk management, continued

Management judgment effected by uncertainties in underlying assumptions

①

Foreign currency risk

The Company undertakes transactions denominated in foreign currencies; consequently, exposures to exchange rate fluctuations arise. The carrying amounts of the Company’s foreign currency denominated monetary assets and monetary liabilities as of June 30, 2015 and December 31, 2014 are as follows:


In thousands of foreign currencies	Assets				Liabilities
Type	June 30, 2015		December 31, 2014		June 30, 2015		December 31, 2014

AUD		158		196		568,774		542,292
BWP		361		—		—		—
CAD		—		1		17		244
EUR		216,380		2,097		1,739		4,087
IDR		—		273,738		—		17,288
MXN		7,705		7,637		—		122
PHP		88,261		196,696		138,411		17,962
SAR		1,279		1,044		—		—
USD		1,145,573		1,211,513		8,948,235		7,415,050
INR		926,488		683,074		163,603		173,753
PKR		180,039		167,747		1,333		2,037
MGA		3,911,098		2,183,910		77,537		69,199
JPY		421,737		1,048,413		20,079,046		20,023,572
KZT		178,573		551,684		—		—
GBP		—		—		—		90
CHF		—		—		400,255		399,634
AED		1,115		3,965		1,089		1,136
ZAR		174		146		—		—
JOD		1,491		1,080		—		1
BDT		44,347		47,167		1,398		314
SEK		—		—		64		196

A sensitivity analysis on the Company’s income for the period assuming a 10% increase and decrease in currency exchange rates as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015					December 31, 2014
Type	10% Increase			10% Decrease		10% Increase			10% Decrease

Increase (decrease) of income before income tax		￦ (963,661	)		963,661		(790,483	)		790,483
Increase (decrease) of shareholder’s equity (*)		(963,661	)		963,661		(790,483	)		790,483

(*)	The effect on the shareholders’ equity excluding the impact of income taxes.

Sensitivity analysis above is conducted for monetary assets and liabilities denominated in foreign currencies other than functional currency, without consideration of hedge effect of related derivatives, as of June 30, 2015 and December 31, 2014.

To manage its foreign currency risk related to foreign currency denominated receivables and payables, the Company has a policy to enter into currency forward agreements. In addition, to manage its foreign currency risk related to foreign currency denominated expected sales transactions and purchase transactions, the Company enters into cross-currency swap agreements.

132

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

44.

Risk Management, Continued

(2)

Financial risk management, continued

②

Interest rate risk

The Company is exposed to interest rate risk due to its borrowing with floating interest rates. A 1% increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates.

The Company’s borrowings and debt securities with floating interest rates as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won
Type	June 30, 2015		December 31, 2014

Short-term borrowings	￦	55,935		20,788
Long-term borrowings		1,972,799		3,506,989
Debt securities		2,315,125		2,534,000


	￦	4,343,859		6,061,777

A sensitivity analysis on the Company’s long-term borrowings and debt securities assuming a 1% increase and decrease in interest rates, without consideration of hedge effect of related derivatives for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:


In millions of won	June 30, 2015					December 31, 2014
Type	1% Increase			1% Decrease		1% Increase			1% Decrease

Increase (decrease) of profit before income tax	￦	(43,439	)		43,439		(60,618	)		60,618
Increase (decrease) of shareholder’s equity (*)		(43,439	)		43,439		(60,618	)		60,618

(*)	The effect on the shareholders’ equity excluding the impact of income taxes.

To manage its interest rate risks, the Company enters into certain interest swap agreements or maintains an appropriate mix of fixed and floating rate borrowings.

③

Electricity rates risk

The Company is exposed to electricity rates risk due to the rate regulation of the government which considers the effect of electricity rate on the national economy.

A sensitivity analysis on the Company’s income for the period assuming a 1% increase and decrease in price of electricity for the six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won	June 30, 2015					June 30, 2014
Type	1% Increase		1% Decrease			1% Increase		1% Decrease

Increase (decrease) of profit before income tax	￦	258,936		(258,936	)		253,714		(253,714	)
Increase (decrease) of shareholder’s equity (*)		258,936		(258,936	)		253,714		(253,714	)

(*)	The effect on the shareholders’ equity excluding the impact of income taxes.

133

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

44.

Risk Management, Continued

(2)

Financial risk management, continued

(iv)

Liquidity risk

The Company has established an appropriate liquidity risk management framework for the management of the Company’s short, medium and long-term funding and liquidity management requirements. The Company manages liquidity risk by continuously monitoring forecasted and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

In addition, the Company has established credit lines on its trade financing and bank overdrafts, and through payment guarantees it has received, it maintains an adequate credit (borrowing) line. In addition, the Company has the ability to utilize excess cash or long-term borrowings for major construction investments.

The following table shows the details of maturities of non-derivative financial liabilities as of June 30, 2015 and December 31, 2014. This table, based on the undiscounted cash flows of the non-derivative financial liabilities including estimated interests, has been prepared based on the respective liabilities’ earliest maturity date.


In millions of won	June 30, 2015
Type	Less than 1 year		1~2 Years		2~5 Years		More than 5 years		Total

Borrowings and debt securities	￦	10,322,893		10,928,786		24,028,768		28,443,665		73,724,112
Finance lease liabilities		183,441		178,792		393,854		250,178		1,006,265
Trade and other payables		4,681,304		323,119		580,934		2,304,361		7,889,718
Financial guarantee contracts (*)		42,154		30,351		219,164		—		291,669


	￦	15,229,792		11,461,048		25,222,720		30,998,204		82,911,764


In millions of won	December 31, 2014
Type	Less than 1 year		1~2 Years		2~5 Years		More than 5 years		Total

Borrowings and debt securities	￦	9,219,013		8,888,723		27,584,208		30,253,070		75,945,014
Finance lease liabilities		184,809		182,072		437,756		294,032		1,098,669
Trade and other payables		6,019,230		318,466		570,988		2,257,220		9,165,904
Financial guarantee contracts (*)		35,449		29,678		83,395		—		148,522


	￦	15,458,501		9,418,939		28,676,347		32,804,322		86,358,109

(*)	Total guarantee amounts associated with the financial guarantee contracts. Financial guarantee liabilities which are recognized as of June 30, 2015 and December 31, 2014 are ￦6,465 million and ￦3,695 million, respectively.

134

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

44.

Risk Management, Continued

(2)

Financial risk management, continued

The expected maturities for non-derivative financial assets as of June 30, 2015 and December 31, 2014 in detail are as follows:


In millions of won	June 30, 2015
Type	Less than 1 year		1~5 Years		More than 5 years		*Other ()**		Total

Cash and cash equivalents	￦	3,850,438		—		—		—		3,850,438
Available-for-sale financial assets		—		—		—		720,196		720,196
Held-to-maturity investments		151		3,223		13		—		3,387
Loans and receivables		103,249		260,211		368,890		9,503		741,853
Long-term/short-term financial instruments		1,585,107		1,634		603,306		321		2,190,368
Trade and other receivables		6,693,849		819,460		863,474		77,778		8,454,561


	￦	12,232,794		1,084,528		1,835,683		807,798		15,960,803


In millions of won	December 31, 2014
Type	Less than 1 year		1~5 Years		More than 5 years		*Other ()**		Total

Cash and cash equivalents	￦	1,796,300		—		—		—		1,796,300
Available-for-sale financial assets		—		—		—		715,151		715,151
Held-to-maturity investments		265		3,336		13		—		3,614
Loans and receivables		68,910		176,600		425,082		9,928		680,520
Long-term/short-term financial instruments		100,099		740		603,308		315		704,462
Trade and other receivables		7,700,166		830,863		824,966		76,104		9,432,099


	￦	9,665,740		1,011,539		1,853,369		801,498		13,332,146

(*)	The maturities cannot be presently determined.

Derivative liabilities classified by maturity periods which from reporting date to maturity date of contract as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015
Type	Less than 1 year			1~2 Years			2~5 Years			More than 5 years			Total

Gross settlement
- Trading	￦	(38,469	)		(8,938	)		(70,318	)		44,735			(72,990	)
- Hedging		(7,017	)		(21,974	)		(47,683	)		(21,774	)		(98,448	)


		￦(45,486	)		(30,912	)		(118,001	)		22,961			(171,438	)


In millions of won	December 31, 2014
Type	Less than 1 year			1~2 Years			2~5 Years			More than 5 years			Total

Gross settlement
- Trading	￦	(66,580	)		(15,289	)		(108,717	)		(11,301	)		(201,887	)
- Hedging		(3,070	)		(31,441	)		(70,384	)		(84,815	)		(189,710	)


	￦	(69,650	)		(46,730	)		(179,101	)		(96,116	)		(391,597	)

135

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

44.

Risk Management, Continued

(3)

Fair value risk

The fair value of the Company’s actively-traded financial instruments (i.e. short-term financial assets held for trading, available-for-sale financial assets, etc.) is based on the traded market-price as of the reporting period end. The fair value of the Company’s financial assets is the amount which the asset could be exchanged for or the amount a liability could be settled for.

The fair values of financial instruments where no active market exists or where quoted prices are not otherwise available are determined by using valuation techniques. Valuation techniques include using recent arm’s length market transactions between knowledgeable, willing parties, if available, reference to the current fair value of another instrument that is substantially the same, discounted cash flow analysis and option pricing models. If there is a valuation technique commonly used by market participants to price the instrument and that technique has been demonstrated to provide reliable estimates of prices obtained in actual market transactions, the Company uses that technique.

For trade receivables and payables, the Company considers the carrying value net of impairment as fair value. While for disclosure purposes, the fair value of financial liabilities is estimated by discounting a financial instruments with similar contractual cashflows based on the effective interest method.

(i)

Fair value and book value of financial assets and liabilities as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015				December 31, 2014
Type	Book value		Fair value		Book value		Fair value

Assets recognized at fair value
Available-for-sale financial assets (*1)	￦	720,196		720,196		715,151		715,151
Derivative assets (trading)		83,841		83,841		65,849		65,849
Derivative assets (using hedge accounting)		218,482		218,482		104,276		104,276
Long-term financial instruments		605,261		605,261		604,363		604,363
Short-term financial instruments		1,585,107		1,585,107		100,099		100,099

		3,212,887		3,212,887		1,589,738		1,589,738

Assets carried at amortized cost
Held-to-maturity investments		3,387		3,387		3,614		3,614
Loans and receivables		689,325		689,325		623,997		623,997
Trade and other receivables		8,445,752		8,445,752		9,422,219		9,422,219
Cash and cash equivalents		3,850,438		3,850,438		1,796,300		1,796,300

		12,988,902		12,988,902		11,846,130		11,846,130

Liabilities recognized at fair value
Derivative liabilities (trading)		131,002		131,002		164,931		164,931
Derivative assets (using hedge accounting)		165,601		165,601		172,877		172,877

		296,603		296,603		337,808		337,808

Liabilities carried at amortized cost
Secured borrowings		1,037,373		1,037,373		941,823		941,823
Unsecured bond		57,531,526		61,873,928		58,235,767		61,816,897
Finance lease liabilities		714,193		714,193		769,435		769,435
Unsecured borrowings		2,194,491		2,218,330		3,625,949		3,731,331
Trade and other payables (*2)		7,889,718		7,889,718		9,165,904		9,165,904
Bank overdraft		28,503		28,503		20,788		20,788

	￦	69,395,804		73,762,045		72,759,666		76,446,178

(*1)	Book values of equity securities held by the Company that were measured at cost as of June 30, 2015 and December 31, 2014 are ￦283,372 million and ￦299,308 million, respectively, as a quoted market price does not exist in an active market and its fair value cannot be measured reliably.

(*2)	Excludes finance lease liabilities.

136

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

44.

Risk Management, Continued

(3)

Fair value risk, continued

(ii)

Interest rates used for determining fair value

The interest rates used to discount estimated cash flows, when applicable, are based on the government yield curve at the reporting date plus an adequate credit spread.

The discount rate used for calculating fair value as of June 30, 2015 and December 31, 2014 are as follows:


Type	June 30, 2015	December 31, 2014

Derivatives	0.29% ~ 2.29%	0.04% ~ 2.78%
Borrowings and debt securities	0.09% ~ 5.80%	0.16% ~ 5.80%
Finance lease	9.00% ~ 10.83%	9.00% ~ 10.83%

(iii)

Fair value hierarchy

The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, classified as Level 1, 2 or 3, based on the degree to which the fair value is observable.


Level 1:		Unadjusted quoted prices in active markets for identical assets or liabilities;

Level 2:		Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and

Level 3:		Inputs that are not based on observable market data.

Fair values of financial instruments by hierarchy level as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015
Type	Level 1		Level 2		Level 3		Total

Financial assets at fair value
Available-for-sale financial assets	￦	268,192		—		168,632		436,824
Derivative assets		—		302,323		—		302,323

		268,192		302,323		168,632		739,147


Financial liabilities at fair value
Derivative liabilities		—		296,603		—		296,603


In millions of won	December 31, 2014
Type	Level 1		Level 2		Level 3		Total

Financial assets at fair value
Available-for-sale financial assets	￦	247,215		—		168,627		415,842
Derivative assets		—		170,125		—		170,125

		247,215		170,125		168,627		585,967


Financial liabilities at fair value
Derivative liabilities		—		337,806		—		337,806

The fair value of available-for-sale financial assets publicly traded is measured at the closing bid price quoted at the end of the reporting period. Meanwhile, the fair value of unquoted available-for-sale financial assets is calculated using the valuation results from an external pricing service in which weighted average borrowing rates of interest of evaluated companies are used as a discount rate. The fair value of derivatives is measured using valuation model which is determined at the present value of estimated future cash flows discounted at current market interest rate.

137

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

44.

Risk Management, Continued

(3)

Fair value risk, continued

Changes of financial assets and liabilities which are classified as level 3 for the six-month period ended June 30, 2015 and for the year ended December 31, 2014 are as follows:

In millions of won

June 30, 2015

Beginning
balance

Acquisition

Reclassified
category

Valuation

Disposal

Foreign
currency
translation

Ending
balance

Financial assets at fair value

Available-for-sale financial assets

Unlisted securities

￦

168,627

—

168,632


In millions of won	December 31, 2014
	Beginning balance		Acquisition		Reclassified category		Valuation			Disposal			Foreign currency translation		Ending balance

Financial assets at fair value
Available-for-sale financial assets
Unlisted securities	￦	171,304		—		—		(2,677	)		—			—		168,627
Debt securities		14,655		—		—		—			(14,655	)		—		—

45.

Service Concession Arrangements

(1)

Significant terms and concession period of the arrangement

The Company has entered into a contract with National Power Corporation (the “NPC”), based in the Republic of the Philippines whereby the Company can collect the electricity rates which are composed of fixed costs and variable costs during the concession period after building, rehabilitating, and operating the power plant.

(2)

Rights and classification of the arrangement

The Company has the rights to use and own the power plant during the concession period from 2002 to 2022. At the end of the concession period, the Company has an obligation to transfer its ownership of the power plant to NPC.

(3)

The Company’s expected future collections of service concession arrangements as of June 30, 2015 are as follows:


In millions of won
Type	Amounts

Less than 1 year	￦	117,417
1 ~ 2 years		117,417
2 ~ 3 years		117,417
Over 3 years		459,883

	￦	812,134

138

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

46.

Related Parties

(1)

Related parties of the Company as of June 30, 2015 are as follows:


Type		Related party

Parent		Republic of Korea government

Subsidiaries (76 subsidiaries)		Korea Hydro & Nuclear Power Co., Ltd., Korea South-East Power Co., Ltd., Korea Midland Power Co., Ltd., Korea Western Power Co., Ltd., Korea Southern Power Co., Ltd., Korea East-West Power Co., Ltd., KEPCO Engineering & Construction Company, Inc., KEPCO Plant Service & Engineering Co., Ltd., KEPCO Nuclear Fuel Co., Ltd., KEPCO KDN Co., Ltd., Garorim Tidal Power Plant Co., Ltd., KEPCO International HongKong Ltd., KEPCO International Philippines Inc., KEPCO Gansu International Ltd., KEPCO Philippines Holdings Inc., KEPCO Philippines Corporation, KEPCO Ilijan Corporation, KEPCO Lebanon SARL, KEPCO Neimenggu International Ltd., KEPCO Shanxi International Ltd., KOMIPO Global Pte Ltd., KEPCO Canada Energy Ltd., KEPCO Netherlands B.V., KOREA Imouraren Uranium Investment Corp., KEPCO Australia Pty., Ltd., KOSEP Australia Pty., Ltd., KOMIPO Australia Pty., Ltd., KOWEPO Australia Pty., Ltd., KOSPO Australia Pty., Ltd. KEPCO Middle East Holding Company, Qatrana Electric Power Company, KHNP Canada Energy Ltd., KEPCO Bylong Australia Pty., Ltd., Korea Waterbury Uranium Limited Partnership, KEPCO Canada Uranium Investment Limited Partnership, Korea Electric Power Nigeria Ltd., KEPCO Holdings de Mexico, KST Electric Power Company, KEPCO Energy Service Company, KEPCO Netherlands S3 B.V., PT. KOMIPO Pembangkitan Jawa Bali, PT. Cirebon Power Service, KOWEPO International Corporation, KOSPO Jordan LLC, EWP Philippines Corporation, EWP America Inc., EWP Renewable Co., DG Fairhaven Power, LLC, DG Kings Plaza, LLC, DG Whitefield, LLC, Springfield Power, LLC, KNF Canada Energy Limited, PT KEPCO Resource Indonesia, EWP Barbados 1 SRL, California Power Holdings, LLC, Gyeonggi Green Energy Co., Ltd., PT. Tanggamus Electric Power, Gyeongju Wind Power Co., Ltd., KOMIPO America Inc., EWPRC Biomass Holdings, LLC, KOSEP USA, INC., PT. EWP Indonesia, KOWEPO America LLC., KEPCO Netherlands J3 B.V., Korea Offshore Wind Power Co., Ltd., Global One Pioneer B.V., Global Energy Pioneer B.V., Mira Power Limited, KOSEP Material Co., Ltd., Commerce and Industry Energy Co., Ltd., KEPCO Singapore Holdings Pte., Ltd., KOWEPO India Private Limited, KEPCO KPS Philippines Corp., KOSPO Chile SpA., PT. KOWEPO Sumsel Operation And Maintenance Services, HeeMang Sunlight Power Co., Ltd.

Associates (52 associates)		Daegu Green Power Co., Ltd., Korea Gas Corporation, Korea Electric Power Industrial Development Co., Ltd., YTN Co., Ltd., Cheongna Energy Co., Ltd., Gangwon Wind Power Co., Ltd., Hyundai Green Power Co., Ltd., Korea Power Exchange, AMEC Partners Korea, Hyundai Energy Co., Ltd., Ecollite Co., Ltd., Taebaek Wind Power Co., Ltd., Muju Wind Power Co., Ltd., Pyeongchang Wind Power Co., Ltd., Daeryun Power Co., Ltd., JinanJangsu Wind Power Co., Ltd., Changjuk Wind Power Co., Ltd., KNH Solar Co., Ltd., SPC Power Corporation, Gemeng International Energy Co., Ltd., PT. Cirebon Electric Power, KNOC Nigerian East Oil Co., Ltd., KNOC Nigerian West Oil Co., Ltd., Dolphin Property Limited, PT Wampu Electric Power, PT. Bayan Resources TBK, S-Power Co., Ltd., Pioneer Gas Power Limited, Eurasia Energy Holdings, Xe-Pian Xe-Namnoy Power Co., Ltd., Busan Solar Co., Ltd., Hadong Mineral Fiber Co., Ltd., Green Biomass Co., Ltd., PT. Mutiara Jawa, Heang Bok Do Si Photovoltaic Power Co., Ltd., DS POWER Co., Ltd., Dongducheon Dream Power Co., Ltd., KS Solar Corp. Ltd., Yeongwol Energy Station Co., Ltd., Jinbhuvish Power Generation Pvt. Ltd., SE Green Energy Co., Ltd., Daegu Photovoltaic Co., Ltd., Jeongam Wind Power Co., Ltd., Korea Power Engineering Service Co., Ltd., Goseong Green Energy Co. Ltd., Naepo Green Energy Co., Ltd., Shin Pyeongtaek Power Co., Ltd., Gangneung Eco Power Co., Ltd., Noeul Green Energy Co., Ltd., Samcheok Eco Material Co., Ltd., Busan Green Energy Co., Ltd., Jungbu Bio Energy Co., Ltd.

Joint ventures (38 joint ventures)		KEPCO-Uhde Inc., Eco Biomass Energy Sdn. Bhd., Datang Chaoyang Renewable Power Co., Ltd., Shuweihat Asia Power Investment B.V., Shuweihat Asia Operation & Maintenance Company, Waterbury Lake Uranium L.P., ASM-BG Investicii AD, RES Technology AD, KV Holdings, Inc., KEPCO SPC Power Corporation, Canada Korea Uranium Limited Partnership, KEPCO Energy Resource Nigeria Limited, Gansu Datang Yumen Wind Power Co., Ltd., Datang Chifeng Renewable Power Co., Ltd., Datang KEPCO Chaoyang Renewable Power Co., Ltd., Rabigh Electricity Company, Rabigh Operation & Maintenance Company, Jamaica Public Service Company Limited, KW Nuclear Components Co., Ltd., Busan Shinho Solar Power Co., Ltd., GS Donghae Electric Power Co., Ltd., Global Trade Of Power System Co., Ltd., Expressway Solar-light Power Generation Co., Ltd, KODE NOVUS 1 LLC., KODE NOVUS 2 LLC., Daejung Offshore Wind Power Co., Ltd., Amman Asia Electric Power Company, KEPCO-ALSTOM Power Electronics Systems, Inc., Dangjin Echo Power Co., Ltd.,, Honam Wind Power Co., Ltd., Nepal Water & Energy Development Company Pty Ltd., Kelar S.A, PT. Tanjung Power Indonesia, Incheon New Power Co., Ltd., Seokmun Energy Co., Ltd., Nghi Son 2 Power Ltd., Chun-cheon Energy Co., Ltd., Yeonggwangbaeksu Wind Power Co., Ltd.

Others		Korea Development Bank

(2)

Transactions between the Company and its subsidiaries are eliminated during the consolidation and are not disclosed herein.

139

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

46.

Related Parties, Continued

(3)

Related party transactions for the six-month periods ended June 30, 2015 and 2014 are as follows:

<Sales and Others>


In millions of won		Sales and others
Company name	Transaction type	June 30, 2015		June 30, 2014

<Associates>
Daegu Green Power Co., Ltd.	Electricity sales	￦	521		582
Dongducheon Dream Power Co., Ltd.	Rental income and others		7,317		6,872
Korea Gas Corporation	Electricity sales		44,730		40,530
Jeongam Wind Power Co., Ltd.	Electricity sales		5		5
Korea Power Engineering Service Co., Ltd.	Repairing expenses		1,138		—
Yeongwol Energy Station Co., Ltd.	Service		407		2,519
KS Solar Co., Ltd.	Electricity sales		10		4
Heang Bok Do Si Photovoltaic Power Co., Ltd.	Electricity sales		1		—
Korea Electric Power Industrial Development Co., Ltd.	Service		7,421		9,200
DS POWER Co., Ltd.	Service		57,754		38,506
Goseong Green Energy Co. Ltd.	Property sales		3,369		—
Gangneung Eco Power Co., Ltd.	Service		2,113		—
Shin Pyeongtaek Power Co., Ltd.	Service		1,048		—
Naepo Green Energy Co., Ltd.	Electricity sales		33		—
YTN Co., Ltd.	Electricity sales		932		6,250
Busan Green Energy Co., Ltd.	Electricity sales		1		—
Cheongna Energy Co., Ltd.	Service		17,797		7,259
Gangwon Wind Power Co., Ltd.	Electricity sales		929		2,057
Hyundai Green Power Co., Ltd.	Design Service		12,068		12,197
Korea Power Exchange	Service		1,773		6,238
Hyundai Energy Co., Ltd.	Service		11,809		27,508
Taebaek Wind Power Co., Ltd.	Service		455		332
Pyeongchang Wind Power Co., Ltd.	Design Service		57		22
Daeryun Power Co., Ltd.	Electricity sales		921		771
Changjuk Wind Power Co., Ltd.	Electricity sales		342		351
KNH Solar Co., Ltd.	Electricity sales		9		9
S-Power Co., Ltd.	Service		3,735		521
Busan Solar Co., Ltd.	Electricity sales		8		9
Green Biomass Co., Ltd.	Woodchip purchase		36		—
SPC Power Corporation	Commission		1,360		—
PT. Bayan Resources TBK	Service		73		—
Xe-Pian Xe-Namnoy Power Co., Ltd.	Service		266		—

<Joint ventures>
KEPCO SPC Power Corporation	Service		14,366		5,954
Daejung Offshore Wind Power Co., Ltd.	Electricity sales		1		—
KEPCO-ALSTOM Power Electronics Systems, Inc.	Service		597		502
Dangjin Echo Power Co., Ltd.	Technical fee		10		6
Honam Wind Power Co., Ltd.	Electricity sales		28		37
Seokmun Energy Co., Ltd.	Technical fee		496		—
Incheon New Power Co., Ltd.	Construction Revenue		128		5,138
Chun-cheon Energy Co., Ltd.	Technical fee		672		—
Yeonggwangbaeksu Wind Power Co., Ltd.	Electricity sales		143		—
KW Nuclear Components Co., Ltd.	Service		1,582		367
GS Donghae Electric Power Co., Ltd.	Service		1,865		1,793
Busan Shinho Solar Power Co., Ltd.	Electricity sales		12		12
Global Trade Of Power System Co., Ltd.	Electricity sales		—		39
Datang Chifeng Renewable Power Co., Ltd.	Interest income		9,056		1,067
Rabigh Electricity Company	Electricity sales		259		—
Rabigh Operation & Maintenance Company	Service		—		2,822
Shuweihat Asia Operation & Maintenance Company	Dividend income		102		—
Jamaica Public Service Company Limited	Repair Service		1,494		1,427
Amman Asia Electric Power Company	Service		26,692		6,456
Kelar S. A	Service		5,122		—

140

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

46.

Related Parties, Continued

(3)

Related party transactions for the six-month periods ended June 30, 2015 and 2014 are as follows, continued:

<Purchase and Others>


In millions of won		Purchase and others
Company name	Transaction type	June 30, 2015		June 30, 2014

<Associates>
Daegu Green Power Co., Ltd.	Electricity sales	￦	178,341		—
Dongducheon Dream Power Co., Ltd.	Rental income and others		474,837		—
Korea Gas Corporation	Purchase of power generation fuel		2,655,013		5,823,882
Daegu Photovoltaic Co., Ltd.	REC Purchase		1,229		1,849
Korea Power Engineering Service Co., Ltd.	Service		2,221		—
Yeongwol Energy Station Co., Ltd.	REC Purchase		5,253		—
KS Solar Energy Co., Ltd.	REC Purchase		3,639		1,741
Heang Bok Do Si Photovoltaic Power Co., Ltd.	Rental Fee and others		226		—
Korea Electric Power Industrial Development Co., Ltd.	Electricity metering service fee		133,411		114,805
YTN Co., Ltd.	Advertisement fee		162		14
Gangwon Wind Power Co., Ltd.	Electricity purchase		13,451		14,796
Hyundai Green Power Co., Ltd.	Electricity purchase		223,476		244,214
Korea Power Exchange	Trading Fees		43,152		44,205
Hyundai Energy Co., Ltd.	Electricity purchase		1,117		1,806
Taebaek Wind Power Co., Ltd.	REC Purchase		4,276		7,014
Daeryun Power Co., Ltd.	Electricity sales		128,792		—
Changjuk Wind Power Co., Ltd.	Electricity purchase		4,230		7,197
KNH Solar Co., Ltd.	Electricity sales		3,445		2,818
S-Power Co., Ltd.	Service		345,482		—
Busan Solar Co., Ltd.	Electricity sales		2,324		2,017
Green Biomass Co., Ltd.	Woodchip purchase		2,267		661

<Joint ventures>
KEPCO-ALSTOM Power Electronics Systems, Inc.	Service		41,976		176
Honam Wind Power Co., Ltd.	Electricity purchase		3,618		2,385
Yeonggwangbaeksu Wind Power Co., Ltd.	Electricity purchase		334		—
Busan Shinho Solar Power Co., Ltd.	REC Purchase		4,262		4,063
Global Trade Of Power System Co., Ltd.	Plant facility purchase		1		—
Expressway Solar-light Power Co., Ltd.	Electricity purchase		1,880		1,917
Jamaica Public Service Company Limited	Service		46		54

141

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

46.

Related Parties, Continued

(4)

Receivables and payables arising from related party transactions as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won		Receivables				Payables
Company name	Type	June 30, 2015		December 31, 2014		June 30, 2015		December 31, 2014

<Associates>
Daegu Green Power Co., Ltd.	Trade receivables	￦	84		90		—		—
	Non-trade receivables and others		43		—		—
	Trade payables		—		—		18,760		—
Dongducheon Dream Power Co., Ltd.	Trade receivables		1,875		1,124		—		—
Korea Gas Corporation	Trade receivables		6,538		8,746		—		—
	Non-trade receivables and others		177		152		—		—
	Trade payables		—		—		329,167		1,104,075
	Non-trade payables and others		—		—		302		—
Jeongam Wind Power Co., Ltd.	Non-trade payables and others		—		—		—		1
Korea Power Engineering & Power Services Co., Ltd.	Non-trade payables and others		—		—		229		447
Yeongwol Energy Station Co., Ltd.	Trade receivables		7,043		7,060		—		—
KS Solar Corp. Ltd.	Trade receivables		1		2		—		—
	Trade payables		—		—		122		—
	Non-trade payables and others		—		—		—		113
Korea Electric Power Industrial Development Co., Ltd.	Trade receivables		607		692		—		—
	Non-trade receivables and others		18		23		—		—
	Trade payables		—		—		4,006		5,688
	Non-trade payables and others		—		—		12,177		22,507
DS Power Co., Ltd.	Trade receivables		100		46		—		—
	Non-trade receivables and others		—		35,909		—		—
	Non-trade payables and others		—		—		16,920		1
Goseong Green Energy Co. Ltd.	Non-trade payables and others		—		—		3,900		3,900
Gangneung Eco Power Co., Ltd.	Trade receivables		1		—		—		—
Shin Pyeongtaek Power Co., Ltd.	Non-trade receivables and others		1,151		191		—		—
Naepo Green Energy Co., Ltd.	Trade receivables		4		8		—		—
YTN Co., Ltd.	Trade receivables		176		91		—		—
YTN Co., Ltd.	Non-trade payables and others		—		—		127		44
Cheongna Energy Co., Ltd.	Trade receivables		99		148		—		—
Cheongna Energy Co., Ltd.	Non-trade receivables and others		17		5,073		—		—
	Non-trade payables and others		—		—		389		—
Gangwon Wind Power Co., Ltd.	Trade receivables		15		6		—		—
	Trade payables		—		—		505		—
	Non-trade payables and others		—		—		—		4,982
Hyundai Green Power Co., Ltd.	Trade receivables		398		837		—		—
	Trade payables		—		—		35,373		—
	Non-trade payables and others		—		—		—		43,417
Korea Power Exchange	Trade receivables		9,659		611		—		—
	Trade payables		—		—		3,042		3,676
	Non-trade payables and others		—		—		1,046		1,360
Hyundai Energy Co., Ltd.	Trade receivables		34,858		30,186		—		—
	Trade payables		—		—		86		—
	Non-trade payables and others				—		8,489		8,649
Ecollite Co., Ltd.	Non-trade receivables and others		210		—		—		—
Taebaek Wind Power Co., Ltd.	Trade receivables		98		104		—		—
	Trade payables		—		—		85		—
	Non-trade payables and others		—		—		—		862

142

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

46.

Related Parties, Continued

(4)

Receivables and payables arising from related party transactions as of June 30, 2015 and December 31, 2014 are as follows, continued:


In millions of won		Receivables				Payables
Company name	Type	June 30, 2015		December 31, 2014		June 30, 2015		December 31, 2014

Pyeongchang Wind Power Co., Ltd	Non-trade receivables and others	￦	158		306		—		—
Daeryun Power Co., Ltd.	Trade receivables		170		150		—		—
	Trade payables		—		—		11,660		—
Changjuk Wind Power Co., Ltd.	Non-trade receivables and others		84		93				—
	Trade payables		—		—		92		—
	Non-trade payables and others				—		—		867
Busan Solar Co., Ltd.	Trade receivables		1		1		—		—
	Trade payables		—		—		11		—
	Non-trade payables and others		—		—		229		127
KNH Solar Co., Ltd.	Trade receivables		1		1		—		—
	Trade payables		—		—		25		—
S-Power Co., Ltd.	Trade receivables		174		213		—		—
	Non-trade receivables and others		393		1,203		—		—
	Trade payables		—		—		33,605		—
	Non-trade payables and others		—		—		—		55,238
Green Biomass Co., Ltd.	Non-trade receivables and others		26		—		—		—
	Non-trade payables and others		—		—		490		—
SPC Power Corporation	Non-trade receivables and others		—		64		—		—
Pioneer Gas Power Limited	Non-trade receivables and others		—		214		—		—
Xe-Pian Xe-Namnoy Power Co., Ltd.	Non-trade receivables and others		—		547		—		—

<Joint ventures>
KEPCO SPC Power Corporation	Trade receivables		—		2,519		—		—
KEPCO SPC Power Corporation	Non-trade receivables and others		248		1,736		—		—
KEPCO-ALSTOM Power Electronics Systems, Inc.	Non-trade receivables and others Non-trade payables and others		653 —		668 —		— 25		— —
Incheon New Power Co., Ltd.	Trade receivables		128		1,383		—		—
Dangjin Echo Power Co., Ltd.	Non-trade receivables and others		—		1,955		—		—
Honam Wind Power Co., Ltd.	Trade payables		—		—		112
	Non-trade payables and others		—		—		1,193		2,481
Seokmun Energy Co., Ltd.	Non-trade receivables and others		1,143		1,101		—		—
Chun-cheon Energy Co., Ltd.	Non-trade receivables and others		499		—		—		—
Yeonggwangbaeksu Wind Power Co., Ltd.	Trade receivables		10		—		—		—
	Non-trade receivables and others		133		—		—		—
	Non-trade payables and others		—		—		334		—
KW Nuclear Components Co., Ltd.	Non-trade receivables and others		—		57		—		—
GS Donghae Electric Power Co., Ltd.	Non-trade receivables and others		159		14,626		—		—
	Non-trade payables and others		—		—		53		—
Busan Shinho Solar Power Co., Ltd.	Trade receivables		2		2		—		—
	Trade payables		—		—		155		—
	Non-trade receivables and others				—		1,012		1,516
Datang Chifeng Renewable Power Co., Ltd.	Trade receivables		457		511		—		—
Jamaica Public Service Company Limited	Trade receivables		572		1,121		—		—
	Non-trade receivables and others		432		303		—		—
Amman Asia Electric Power Company	Trade receivables		8,621		11,171		—		—

143

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

46.

Related Parties, Continued

(5)

Loans and others arising from related party transactions as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won
Type	Company name	Beginning balance			Loans		Collection			Others			Ending balance

Joint ventures	KEPCO SPC Power Corporation	￦	32,866			—		(2,528	)		687			31,025
Joint ventures	Datang Chifeng Renewable Power Co., Ltd.		29,731			—		(3,716	)		589			26,604
Joint ventures	Jamaica Public Service Company Limited		2,199			—		—			50			2,249
Associates	KNOC Nigerian East Oil Co., Ltd. KNOC Nigerian West Oil Co., Ltd.		26,544			—		—			560			27,104
	Allowance for doubtful accounts		(16,884	)		—		—			(298	)		(17,182	)
Associates	Rabigh Electricity Company		62,713			—		(13,117	)		1,121			50,717
Associates	PT. Cirebon Electric Power		45,136			4,137		—			1,117			50,390
Associates	Xe-Pian Xe-Namnoy Power Co., Ltd.		1,413			—		—			—			1,413


		￦	183,718			4,137		(19,361	)		3,826			172,320

(6)

Borrowings arising from related party transactions as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won
Related parties	Type	Beginning balance		Borrowings		Repayment			Ending balance

Korea Development Bank	Facility	￦	1,552,600		—		(1,301,180	)		251,420
	Others		7,178		—		(382	)		6,796
	Operating funds		8,618		12,000		(8,618	)		12,000

(7)

Guarantees provided to associates or joint ventures as of June 30, 2015 are as follows:


In millions of won and thousands of foreign currencies
Primary guarantor	Secondary guarantor	Type of guarantees	Credit limit		Guarantee

Korea Electric Power Corporation	KEPCO SPC Power Corporation	Debt guarantees	USD	116,368	SMBC, The Export-import Bank of Korea and ADB
Korea Electric Power Corporation	Shuweihat Asia O&M Co., Ltd.	Performance guarantees	USD	11,000	ADWEA
Korea Electric Power Corporation	KNOC Nigerian East Oil Co., Ltd. and KNOC Nigerian West Oil Co., Ltd.	Performance guarantees	USD	34,650	Korea National Oil Corporation (Nigerian government)
Korea Western Power Co., Ltd.	Cheongna Energy Co., Ltd.	Collateralized money invested	KRW	48,353	Korea Exchange Bank, Hana Bank and others
Korea Western Power Co., Ltd.	Cheongna Energy Co., Ltd.	Guarantees for supplemental funding (*1)		—	Korea Exchange Bank, Hana Bank and others
Korea Western Power Co., Ltd.	Xe-Pian Xe-Namnoy Power Co., Ltd.	Payment guarantees for business reserve	USD	2,500	Krung Thai Bank
		Collateralized money invested	USD	23,481
		Guarantees for supplemental funding (*1)		—

144

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

46.

Related Parties, Continued

(7)

Guarantees provided to associates or joint ventures as of June 30, 2015 are as follows, continued:


In millions of won and thousands of foreign currencies
Primary guarantor	Secondary guarantor	Type of guarantees	Credit limit		Guarantee

Korea Western Power Co., Ltd.	Rabigh O&M Co., Ltd.	Performance guarantees	SAR	4,800	Saudi Arabia British Bank
Korea Western Power Co., Ltd.	Daegu Photovoltaic Co., Ltd.	Collateralized money invested	KRW	1,230	IBK
Korea Western Power Co., Ltd.	Dongducheon Dream Power Co., Ltd. (*2)	Collateralized money invested	KRW	111,134	Kookmin Bank
Korea Western Power Co., Ltd.	PT. Mutiara Jawa	Collateralized money invested	USD	2,610	Shinhan Bank Singapore
Korea Western Power Co., Ltd.	Heangbok Do Si Photovoltaic Power Co., Ltd.	Collateralized money invested	KRW	194	Shinhan Capital Co., Ltd. and Nonghyup Bank
Korea Western Power Co., Ltd.	Shin Pyeongtaek Power Co., Ltd.	Collateralized money invested	KRW	40	Kookmin Bank

Korea East-West Power Co., Ltd.	Busan Shinho Solar Power Co., Ltd.	Collateralized money invested	KRW	2,100	KT Capital Co., Ltd.
Korea East-West Power Co., Ltd.	Seokmun Energy Co., Ltd.	Guarantees for supplemental funding (*3)		—	Hanmaeum 2nd Securitization Co., Ltd.
Korea East-West Power Co., Ltd.	Chun-cheon Energy Co., Ltd.	Collateralized money invested	KRW	14	Kookmin Bank and others
Korea East-West Power Co., Ltd.	Chun-cheon Energy Co., Ltd.	Guarantees for supplemental funding (*4)		—	Kookmin Bank and others
Korea East-West Power Co., Ltd.	Honam Wind Power Co., Ltd.	Collateralized money invested	KRW	3,480	Shinhan Bank and others
Korea East-West Power Co., Ltd.	Honam Wind Power Co., Ltd.	Guarantees for supplemental funding (*1)		—	Shinhan Bank and others
Korea East-West Power Co., Ltd.	GS-Donghae Electric Power Co., Ltd.	Collateralized money invested	KRW	204,000	Korea Development Bank and others
Korea East-West Power Co., Ltd.	GS-Donghae Electric Power Co., Ltd.	Guarantees for supplemental funding (*1)		—	Korea Development Bank and others
Korea East-West Power Co., Ltd.	Yeonggwangbaeksu Wind Power Co., Ltd.	Collateralized money invested	KRW	3,000	Hyundai Marine & Fire Insurance Co., Ltd. and others
Korea East-West Power Co., Ltd.	Yeonggwangbaeksu Wind Power Co., Ltd.	Guarantees for supplemental funding (*1)		—	Hyundai Marine & Fire Insurance Co., Ltd. and others
Korea East-West Power Co., Ltd.	PT. Tanjung Power Indonesia	Debt guarantees	USD	10,500	The Bank of Tokyo-Mitsubishi
Korea Southern Power Co., Ltd.	KNH Solar Co., Ltd.	Collateralized money invested	KRW	1,296	Shinhan Bank and Kyobo Life Insurance Co., Ltd.
Korea Southern Power Co., Ltd.	KNH Solar Co., Ltd.	Performance guarantees and guarantees for supplemental funding (*1)		—	Shinhan Bank and Kyobo Life Insurance Co., Ltd.
Korea Southern Power Co., Ltd.	Daeryun Power Co., Ltd.	Collateralized money invested	KRW	25,477	Korea Development Bank, Daewoo Securities Co., Ltd. and others
Korea Southern Power Co., Ltd.	Daeryun Power Co., Ltd.	Guarantees for supplemental funding (*1)		—

145

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

46.

Related Parties, Continued

(7)

Guarantees provided to associates or joint ventures as of June 30, 2015 are as follows, continued:


In millions of won and thousands of foreign currencies
Primary guarantor	Secondary guarantor	Type of guarantees	Credit limit		Guarantee

Korea Southern Power Co., Ltd.	Changjuk Wind Power Co., Ltd.	Collateralized money invested	KRW	3,801	Shinhan Bank and Woori Bank
Korea Southern Power Co., Ltd.	Changjuk Wind Power Co., Ltd.	Guarantees for supplemental funding (*1)		—	Shinhan Bank and Woori Bank
Korea Southern Power Co., Ltd.	Busan Solar Co., Ltd.	Collateralized money invested	KRW	793	Consus Asset Management Co., Ltd
Korea Southern Power Co., Ltd.	Daegu Green Power Co., Ltd.	Collateralized money invested	KRW	76,193	Korea Exchange Bank and Kookmin Bank
Korea Southern Power Co., Ltd.	Daegu Green Power Co., Ltd.	Performance guarantees and guarantees for supplemental funding (*1)		—	Korea Exchange Bank and Kookmin Bank
Korea Southern Power Co., Ltd.	KS Solar Corp. Ltd.	Collateralized money invested	KRW	637	Shinhan Capital Co., Ltd.
Korea Southern Power Co., Ltd.	Kelar S.A.	Performance guarantees (*1)		—	Korea Exchange Bank, SMBC, and others
	Kelar S.A.	Debt guarantees	USD	132,600	SMBC, MIZUHO, and others
Korea Southern Power Co., Ltd.	DS Power Co., Ltd.	Collateralized money invested	KRW	2,900	Korea Development Bank and Daewoo Securities Co., Ltd.
Korea Southern Power Co., Ltd.	DS Power Co., Ltd.	Guarantees for supplemental funding (*1)		—	Korea Development Bank and Daewoo Securities Co., Ltd.
Korea Southern Power Co., Ltd.	Pyoungchang Wind Power Co., Ltd.	Collateralized money invested	KRW	3,875	Woori Bank and Shinhan Bank
	Pyoungchang Wind Power Co., Ltd.	Performance guarantees and guarantees for supplemental funding (*1)		—	Woori Bank and Shinhan Bank
Korea Southern Power Co., Ltd.	Taebaek Wind Power Co., Ltd.	Guarantees for supplemental funding (*1)		—	Shinhan Bank and Cheju Bank
KEPCO Engineering & Construction Company, Inc.	DS Power Co., Ltd.	Collateralized money invested	KRW	15,000	Korea Development Bank and Daewoo Securities Co., Ltd.
KEPCO Engineering & Construction Company, Inc.	DS Power Co., Ltd.	Performance guarantees and guarantees for supplemental funding (*1)		—	Korea Development Bank and Daewoo Securities Co., Ltd.
Korea Midland Power Co., Ltd.	Hyundai Green Power Co., Ltd.	Collateralized money invested	KRW	87,003	Korea Development Bank and others
Korea Midland Power Co., Ltd.	Hyundai Green Power Co., Ltd.	Guarantees for supplemental funding (*1)		—	Korea Development Bank and others
Korea Midland Power Co., Ltd.	PT. Cirebon Electric Power	Debt guarantees	USD	12,000	Nonghyup Bank
Korea Midland Power Co., Ltd.	PT. Wampu Electric Power	Performance guarantees		—	Hana Bank

146

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

46.

Related Parties, Continued

(7)

Guarantees provided to associates or joint ventures as of June 30, 2015 are as follows, continued:


In millions of won and thousands of foreign currencies
Primary guarantor	Secondary guarantor	Type of guarantees	Credit limit		Guarantee

Korea Midland Power Co., Ltd.	Gangwon Wind Power Co., Ltd.	Collateralized money invested	KRW	7,410	IBK and others
Korea South-East Power Co., Ltd.	Hyundai Energy Co., Ltd.	Collateralized money invested	KRW	35,925	Korea Development Bank and others
Korea South-East Power Co., Ltd.	Hyundai Energy Co., Ltd.	Performance guarantees and guarantees for supplemental funding (*1)		—	Korea Development Bank and others
Korea South-East Power Co., Ltd.	RES Technology AD	Collateralized money invested	KRW	15,595	Korea Development Bank and others
Korea South-East Power Co., Ltd.	RES Technology AD	Debt guarantees	EUR	4,271	Korea Development Bank and others
Korea South-East Power Co., Ltd.	ASM-BG Investicii AD	Collateralized money invested	KRW	16,101	Korea Development Bank and others
Korea South-East Power Co., Ltd.	ASM-BG Investicii AD	Debt guarantees	EUR	4,175	Korea Development Bank and others
Korea South-East Power Co., Ltd.	Express solar-light Power. Generation Co., Ltd.	Guarantees for supplemental funding (*1)		—	Woori Bank
Korea South-East Power Co., Ltd.	S-Power Co., Ltd.	Collateralized money invested	KRW	108,000	Korea Development Bank and others
Korea South-East Power Co., Ltd.	S-Power Co., Ltd.	Performance guarantees and guarantees for supplemental funding (*1)		—	Korea Development Bank and others
KOSEP USA, INC.	KODE NOVUS II LLC	Guarantees for supplemental funding (*1)		—	Korea Development Bank and others
KOSEP USA, INC.	KODE NOVUS I LLC	Guarantees for supplemental funding (*1)		—	The Export-Import Bank of Korea and others
Korea Hydro & Nuclear Power Co., Ltd.	Yeongwol Energy Station Co., Ltd.	Collateralized money invested	KRW	1,400	Meritz Fire & Marine Insurance Co., Ltd.
KEPCO Plant Service & Engineering Co., Ltd.	Incheon New Power Co., Ltd.	Collateralized money invested	KRW	6,800	Shinhan Bank
		Guarantees for supplemental funding (*1)		—

(*1)	The Company guarantees to provide supplemental funding for business with respect to excessive business expenses or insufficient repayment of borrowings.

(*2)	According to the Project Financing Agreement (“Agreement”), if there is any capital increase in Dongducheon Dream Power Co., Ltd. by issuance of new stock after the date of the Agreement, the newly issued shares owned by the Company shall also be provided as a collateral for the Project Financing.

(*3)	The Company has an obligation to invest additional W15 billion to Seokmun Energy Co., Ltd. The obligation may be conducted through acquisition of new shares, converted shares or convertible bonds.

(*4)	The total amount of collateral limit is the amount of convertible bonds issued by the secondary guarantor. The primary guarantor has an obligation to acquire the converted shares up to un-invested balance when the secondary guarantor fails to repay the convertible bonds on the maturity date.

147

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

46.

Related Parties, Continued

(8)

Guarantees provided from related parties as of June 30, 2015 are as follows:


Primary guarantor	Secondary guarantor	Type of guarantees	Credit limit

Korea Development Bank	Korea Electric Power Corporation	Debt guarantees	USD	195,175
	Korea Electric Power Corporation	Debt guarantees		—

(9)

Derivatives transactions with related parties as of June 30, 2015 are as follows:

①

Currency Swap

In millions of won and thousands of U.S. dollars

Counterparty

Contract year

Contract Amount

Contract interest rate per annum

Contract
exchange
rate

Pay

Receive

Pay (%)

Receive (%)

Korea Development Bank

2015~2025

￦

111,190

USD 100,000

2.62

3.25

1,111.90

②

Interest Rate Swap

In millions of won

Counterparty

Contract year

Contract
amount

Contract interest rate per annum

Pay (%)

Receive (%)

Korea Development Bank

2012~2016

￦

200,000

3.57%

3M CD + 0.26%

Korea Development Bank

2012~2016

50,000

3.49%

3M CD + 0.25%

Korea Development Bank (*)

2014~2029

40,000

3M CD – 0.03%

4.65%

(*)

(10)

Salaries and other compensations to the key members of management of the Company for the three and six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won
Type	June 30, 2015				June 30, 2014
Type	Three-month period ended		Six-month period ended		Three-month period ended		Six-month period ended

Salaries	￦	499		694		191		384
Employee benefits		15		31		6		11

	￦	514		725		197		395

47.

Non-Cash Transactions

Significant non-cash investing and financing transactions for the six-month periods ended June 30, 2015 and 2014 are as follows:


In millions of won
Transactions	June 30, 2015		June 30, 2014

Transfer from construction-in-progress to other assets	￦	2,668,281		2,482,413
Recognition of asset retirement cost and related provision for decommissioning costs		1,139,232		141,358
Transfer from provision for disposal of spent nuclear fuel to accrued expenses		262,654		204,812

148

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

48.

Commitments for Expenditure

(1)

The agreements for acquisition of property, plant and equipment as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won	June 30, 2015				December 31, 2014
Contracts	Amounts		Balance		Amounts		Balance

Construction of Dangjin units	￦	1,548,853		98,360		985,035		138,709
Construction of New Boryeong units		1,805,474		489,930		1,803,417		848,887
Construction of New Kori units		15,106,494		8,110,336		15,106,494		8,593,822
Construction of New Seoul units		586,493		525,522		586,493		543,475
Construction of New Uljin units		16,244,160		11,695,246		16,244,160		12,286,719
Construction of New Wolseong units		5,310,003		58,545		5,310,003		171,367
Construction of New Yeongheung units		674,469		3,889		836,708		46,962
Construction of New Yeosu units		482,757		92,724		495,368		255,973
Construction of Office Building (KOPEC)		215,479		11,403		213,216		45,694
Construction of Samcheok units		2,329,313		310,126		2,288,199		528,613
Construction of Sejong city cogeneration units		305,360		46,007		305,360		46,007
Construction of Taean IGCC units		934,053		55,229		927,638		113,625
Construction of Taean units		977,755		256,325		966,680		536,677
Construction of Andong units		40,960		4,749		—		—
Other Purchase contracts		374,581		167,187		75,326		27,341
Purchase of Andong main machine		234,601		—		234,601		11,730
Purchase of cable (TR CNCE-W/AL,1C,400SQ) (unit price contract)		105,588		—		47,579		28,991
Purchase of Concrete Poles (10M, 350KGF)		123,888		44,717		77,209		—
Purchase of Ulsan combined cycle power units		595,223		7,357		286,755		8,355
Purchase of Wonju cogeneration units		52,877		14,250		50,220		17,526
Purchase of Pyeongtak combined cycle power units		—		—		337,674		226


	￦	48,048,380		21,991,901		47,178,135		24,250,700

(2)

As of June 30, 2015, details of contracts for inventory purchase are as follows:

The Company imports all of its uranium ore concentrates from sources outside Korea (including the United States, United Kingdom, Kazakhstan, France, Russia, South Africa, Canada and Australia) which are paid for with currencies other than Won, primarily in U.S. dollars. In order to ensure stable supply, the Company entered into long-term and medium-term contracts with various suppliers, and supplements such supplies with purchases of fuels on spot markets. The long-term and medium-term contract periods vary among contractors and the stages of fuel manufacturing process. Contract prices for processing of uranium are generally based on market prices. Contract periods for ore concentrates, conversion, enrichment and design and fabrication are as follows:


Type	Periods	Contracted amounts
Concentrate	2015 ~ 2030	34,719 Ton U3O8
Transformed	2015 ~ 2022	17,238 Ton U
Enrichment	2015 ~ 2029	34,879 Ton SWU
Molded	2015 ~ 2022	1,852 Ton U

149

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

49.

Contingencies and Commitments

(1)

Ongoing litigations related with contingent liabilities and assets as of June 30, 2015 and December 31, 2014 are as follows:


In millions of won
	June 30, 2015				December 31, 2014
	Number of cases		Claim amount		Number of cases		Claim amount

As the defendant		747	￦	476,830		669	￦	637,749
As the plaintiff		176		433,171		164		460,965

The Company is the defendant against a number of claims. The following are potentially significant claims pertaining to the Company:

①

Hyundai Engineering & Construction Co., Ltd. (“Hyundai E&C”), SK Engineering & Construction Co., Ltd. and GS Engineering & Construction Co., Ltd. filed a law suit for increase in contract bill (formerly, amounted of ￦1,000 million) against Korea Hydro & Nuclear Co., Ltd. (“KHNP”) in September 2013, in accordance with the design changes on the plant construction of New Hanwool 1 & 2. Hyundai Engineering & Construction Co., Ltd. and two other companies submitted an application to demand extra contract payments due to the design change, and they are asking a total amount of ￦133,426 million from KHNP.

Due to the inherent uncertainties, the Company is not able to reliably estimate the amount of compensation and timing if any, that might be awarded to Hyundai E&C and two other companies. Consequently, it is not possible for the Company to make an estimate of the expected financial effect that will result from the ultimate resolution of a lawsuit. Therefore, the Company has not recognized any provision for the lawsuit.

②

In December 2013, the Supreme Court of Korea ruled that regular bonuses also fall under the category of ordinary wages on the condition that those bonuses are paid regularly and uniformly. The Supreme Court ruled, that “employees shall not retroactively demand the difference in overtime pay as additional wages, in the event that the demand itself causes an unexpected increase in spending for their company, and thus lead the company to financial difficulty. In that case, the request is not acceptable, since it is unjust, and it is in breach of the principle of good faith.”

Prior to the ruling of the Supreme Court, the Company determined wages in accordance with budget instructions from the Ministry of Strategy and Finance, which excluded bonuses from ordinary wages and was with the consent of the Company’s labor unions. Any request for the retroactive demand for the difference in overtime pay as additional wages may be limited based on the principle of good faith.

The Korean Power Plant Industry Union and others filed lawsuits against the Company’s six generation subsidiaries and KEPCO Plant Service & Engineering Co., Ltd. due to a dispute over the scope of ordinary wages.

On January 15, 2015, there was a court decision on ordinary wages of the labor union in Korea Southern Power Co., Ltd. According to the judgment, basic bonus, incentives, and part of the subsidies paid regularly, uniformly, and steadily are to be included in the ordinary wages, and as a result of the related lawsuit, it was concluded that this case does not violate the principle of good faith since no significant difficulty in management nor risk in the continuance and existence of the company were predicted. However, the Company appealed at a higher court on February 4, 2015.

In addition, on June 25, 2015, there was a court decision on a crossclaim of Korean Power Plant Industry Union against five generation subsidiaries including Korea South-East Power Co., Ltd., Korea Southern Power Co., Ltd., Korea Midland Power Co., Ltd., Korea Western Power Co., Ltd., and Korea East-West Power Co., Ltd. As a result of the related lawsuit, it was concluded that this case does not violate the principle of good faith since no significant difficulty in management nor risk in the continuance and existence of the Company was predicted. However, the Company appealed at a higher court on July 24, 2015.

The Company believes that the possibility of economic outflow is probable on the ongoing and the expected lawsuit. As a result, the Company recognized ￦168,690 million of other provision.

150

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

49.

Contingencies and Commitments, Continued

(1)

Ongoing litigations related with contingent liabilities and assets as of June 30, 2015 and December 31, 2014 are as follows, continued:

③

Korea Hydro & Nuclear Power Co., Ltd., a subsidiary of the Company, adopted amendments to remuneration regulations and bylaws regarding basic bonuses in the year 2012. With respect to this, a lawsuit was filed in January 2015 (claim amount: ￦11,472 million) by employees against the Company for what they claim to be unpaid bonuses, which is derived from different interpretations of the remuneration regulations and bylaws applied to three-month working period from September to December 2011.

(2)

Guarantees of borrowings provided to other companies as of June 30, 2015 and December 31, 2014 are as follows:

•

The Company has a borrowing of ￦22,500 million from Long Lasting Value (“LLV”) as of June 30, 2015. LLV obtains loans from major stockholders, such as Samsung Life Insurance, and lends the money to other third parties. The Company guarantees secured payments to the major stockholders of LLV, such as payment of principal, tax, commissions, etc., with a limit of ￦23,900 million.

•

In order to secure its status as a shareholder of Navanakom Electric Co., Ltd., the Company has signed a fund supplement contract. According to the contract, in case Navanakom Electric Co., Ltd. does not have sufficient funds for its operation or repayment of borrowings, the Company bears a payment obligation in proportion to its ownership.

(3)

Credit lines provided by financial institutions as of June 30, 2015 are as follows:


In millions of won and thousands of foreign currencies
Commitments	Financial institutions	Currency	Amount

Commitments on bank-overdraft	Nonghyup Bank and others	KRW		1,870,000
Commitments on bank-daylight overdraft	Nonghyup Bank and others	KRW		280,000
Limit amount available for CP	Korea Exchange Bank and others	KRW		950,000
Limit amount available for card	Hana Bank and others	KRW		57,078
	Banco de Oro	PHP		5,000
Certification of payment on payables from foreign country	Korea Development Bank and others	USD		408,175
Loan limit	The Export-Import Bank of Korea and others	KRW		525,250
Loan limit	BNP Paribas and others	USD		2,568,059
Certification of payment on L/C	Woori Bank and others	USD		1,188,903
	Korea Exchange Bank and others	EUR		3,100
	Kookmin bank	JPY		8,677,652
	Korea Exchange Bank	GBP		61,169
Certification of performance guarantee on contract	Seoul Guarantee Insurance and others	KRW		273,226
	Standard Chartered Bank and others	USD		746,937
	Kookmin Bank	EUR		22,249
	Hana Bank	INR		236,443
	Kathmandu Bank	NPR		32,633
Certification of bidding	SMBC and others	USD		10,200
Advance payment bond, Warranty bond, Retention bond and others	Shinhan Bank	EUR		55
	Nonghyup Bank and others	USD		163,392
	Kathmandu Bank and others	NPR		108,926
	Hana Bank	INR		157,830
Others	Korea Exchange Bank and others	KRW		11,250
	Korea Exchange Bank and others	SAR		82,700
	Shinhan Bank and others	USD		189,863
Inclusive credit	Korea Exchange Bank	KRW		501,500
	Shinhan Bank	INR		47,489
	HSBC and others	USD		645,135
Trade finance	BNP Paribas and others	USD		600,000

151

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

49.

Contingencies and Commitments, Continued

(4)

The Company voluntarily suspended operations of the Gangneung hydroelectric generating plant, with a carrying amount of ￦104,577 million, to improve the quality of water used in generating electricity. The expenses related to the depreciation on the utility plant of ￦3,332 million and suspension of operations amounting to ￦306 million are charged to other expenses for the six-month period ended June 30, 2015.

(5)

As of June 30, 2015, the blank check and assets provided as collaterals or pledges to financial institutions by the Company are follows:

In millions of won and thousands of foreign currencies

Guarantor

Guarantee

Type of guarantee

Currency

Amount

Description

KEPCO Nuclear Fuel Co., Ltd.

Korea Resources Corporation

Blank check

KRW

—

Collateral for project loan

Korea East-West Power Co., Ltd.

Korea Development Bank and others

All shareholdings of Gyeongju Wind Power Co., Ltd.

KRW

9,240

Collateral for borrowings

Korea Hydro & Nuclear Power Co., Ltd.

Korea Development Bank and others

All shareholdings of Gyeonggi Green Energy Co., Ltd.

KRW

47,000

Collateral for borrowings

Korea Midland Power Co., Ltd.

Hana Bank and others

All shareholdings of Commerce and Industry Energy Co., Ltd.

KRW

13,605

Collateral for borrowings

KEPCO KDN Co., Ltd.

Hana Bank

Cash and cash equivalents

KRW

740

Collateral for borrowings

Gyeonggi Green Energy Co., Ltd.

Korea Development Bank and others

Factory estate and others

KRW

327,080

Providing guarantees (*)

Commerce and Industry Energy Co., Ltd.

Hana Bank and others

Land, buildings, structures and machinery

KRW

89,115

Collateral for borrowings

Cash and cash equivalents

KRW

9,180

Gyeongju Wind Power Co., Ltd.

Korea Development Bank and others

Existing or expected trade receivables

KRW

14,491

Collateral for borrowings

Cash and cash equivalents

KRW

6,194

Property, plant and equipment and others

KRW

35,386

Qatrana Electric Power Company

The Islamic Development Bank and others

Finance Lease receivable and others

JOD

46,213

Collateral for borrowings

KST Electric Power Company

Scotiabank Inverlat, S.A.

Finance Lease receivable and others

USD

330,000

Collateral for borrowings

(*)

The Company provided to the financial institutions the shares of Gyeonggi Green Energy Co., Ltd., one of its subsidiaries, as collateral related to long-term borrowings. Additionally, pledge for shares, pledge for transfer of rights of long-term borrowings, pledge for insurance claims and other pledges were established.

152

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

50.

Subsequent Events

(1)

Subsequent to the June 30, 2015, subsidiaries of the Company, Korea Southern Power Co., Ltd. and Korea Western Power Co. Ltd., issued new debt securities for funding facilities and operations as follows:


In millions of won
Company Name	Type	Interest rate			Issued date		Maturity		Amounts

Korea Southern Power Co., Ltd.	34-1^st Unsecured bond		1.91	%		2015.07.02		2018.07.02	￦	70,000
	34-2^nd Unsecured bond		2.30	%		2015.07.02		2020.07.02		130,000
	34-3^rd Unsecured bond		2.66	%		2015.07.02		2025.07.02		120,000
Korea Western Power Co., Ltd.	28^th Unsecured bond		2.27	%		2015.07.17		2020.07.17		80,000
	Short-term borrowings		1.61	%		2015.07.23		2015.10.22		20,000
			1.61	%		2015.07.23		2015.10.22		50,000
			1.61	%		2015.07.23		2015.10.22		130,000
			1.61	%		2015.07.23		2015.10.22		20,000

153

KOREA ELECTRIC POWER CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements, Continued

June 30, 2015

(Unaudited)

51.

Adjusted Operating Profit

The operating profit in the Company’s consolidated statements of comprehensive income (loss) prepared in accordance with K-IFRS included in this report differs from that in its consolidated statements of comprehensive income (loss) prepared in accordance with IFRS as issued by IASB. The table below sets forth a reconciliation of the Company’s results from operating activities as presented in the Company’s consolidated statements of comprehensive income prepared in accordance with K-IFRS for each of the three and six-month periods ended June 30, 2015 and 2014 to the operating profit or income as presented in the Company’s consolidated statements of comprehensive income (loss) prepared in accordance with IFRS as issued by IASB for each of the corresponding years.


In millions of won	June 30, 2015						June 30, 2014
	Three-month period ended			Six-month period ended			Three-month period ended			Six-month period ended
Operating profit on the statement of comprehensive Income (loss)	￦	2,087,984			4,327,850			829,240			2,056,317
Add
Other income

Reversal of other provisions		5,076			6,734			1,782			3,842
Reversal of allowance for doubtful accounts		—			—			14			14
Gains on assets contributed		880			3,092			—			20

Gains on liabilities exempted		34			2,371			18			800
Compensation and reparations revenue		34,319			86,856			10,475			21,391
Electricity infrastructure development fund		220			363			12,997			14,955

Revenue from research contracts		1,394			4,531			2,651			3,026
Rental income		47,528			95,786			42,787			91,268
Others		6,879			13,962			4,234			10,365
Other profit
Gains on disposal of property, plant and equipment		78,854			96,769			25,092			32,508
Gains on disposal of intangible assets		32			32			—			—
Gains on foreign currency translation		1,823			2,984			2,994			5,501
Gains on foreign currency transaction		10,999			19,798			14,994			25,908
Gains on insurance		25			25			3,046			3,046
Other profits		26,786			78,513			39,285			92,191
Deduct
Other expense
Accretion expenses of other provisions		(272	)		(316	)		(24	)		(129	)
Depreciation expenses on investment properties		(185	)		(347	)		(234	)		(417	)
Depreciation expense on idle assets		(1,666	)		(3,332	)		(1,667	)		(3,330	)
Other bad debt expense		(5,168	)		(12,983	)		(5,801	)		(17,671	)
Donations		(4,742	)		(17,162	)		(2,822	)		(9,849	)
Others		(4,947	)		(5,977	)		(3,750	)		(5,961	)
Other loss
Losses on disposal of property, plant and equipment		(28,689	)		(41,044	)		(7,197	)		(10,141	)
Losses on disposal of intangible assets		—			(5	)		(17	)		(17	)
Impairment loss on property, plant and equipment		(1,205	)		(1,205	)		—			—
Losses on foreign currency translation		(3,472	)		(9,978	)		(3,812	)		(5,431	)
Losses on foreign currency transaction		(23,864	)		(35,632	)		(11,202	)		(24,878	)
Other losses		(14,048	)		(37,122	)		(13,788	)		(28,210	)


Adjusted operating profit	￦	2,214,575			4,574,563			939,295			2,255,118

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