Form 6-K - Report of foreign issuer [Rules 13a-16 and 15d-16]

Name	Symbol	Market	Type
LG Display Co Ltd	NYSE:LPL	NYSE	Depository Receipt

	Price Change	% Change	Price	High Price	Low Price	Open Price	Traded	Last Trade
	0.06	1.94%	3.16	3.17	3.10	3.16	170,148	01:00:00

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of March 2024

LG Display Co., Ltd.

(Translation of Registrant’s name into English)

LG Twin Towers, 128 Yeoui-dearo, Youngdungpo-gu, Seoul 07336, Republic of 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 ☒ 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): ☐

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

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): ☐

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submission to furnish a report or other document that the registration foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

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

Yes ☐ No ☒

Submission of Audit Report

1.	Name of external auditor: Samjong Accounting Corporation (KPMG)

2.	Date of receiving external audit report: March 7, 2024

3.	Auditor’s opinion


—	FY 2023	FY 2022
Audit Report on Separate Financial Statements	Unqualified	Unqualified

4.	Financial Highlights of Separate Financial Statements


Items	FY 2023			FY 2022
Total Assets		29,732,412,226,019			29,259,038,774,363
Total Liabilities		24,050,857,799,308			21,908,600,089,288
Total Shareholders’ Equity		5,681,554,426,711			7,350,438,685,075
Capital Stock		1,789,078,500,000			1,789,078,500,000
Revenues		19,811,014,881,090			24,131,171,938,572
Operating Income		-3,884,121,296,089			-3,201,463,387,452
Ordinary Income		-2,632,114,468,426			-3,414,516,859,331
Net Income		-1,718,701,175,934			-3,191,386,595,440
Total Shareholders’ Equity / Capital Stock		318	%		411	%

LG DISPLAY CO., LTD.

Separate Financial Statements

For the Years Ended December 31, 2023 and 2022

(With Independent Auditors’ Report Thereon)

Contents


	Page
Independent Auditors’ Report		1

Separate Statements of Financial Position		5

Separate Statements of Comprehensive Loss		6

Separate Statements of Changes in Equity		7

Separate Statements of Cash Flows		8

Notes to the Separate Financial Statements		10

Independent Auditors’ Report on Internal Control over Financial Reporting		104

Report on the Operation of Internal Control over Financial Reporting		106

Independent Auditors’ Report

Based on a report originally issued in Korean

To the Shareholders and Board of Directors

LG Display Co., Ltd.:

Opinion

We have audited the accompanying separate financial statements of LG Display Co., Ltd. (the “Company”), which comprise the separate statements of financial position of the Company as of December 31, 2023 and 2022, the related separate statements of comprehensive loss, changes in equity and cash flows for the years then ended, and notes to the separate financial statements comprising material accounting policies and other explanatory information.

In our opinion, the accompanying separate financial statements present fairly, in all material respects, the separate financial position of the Company as of December 31, 2023 and 2022, and its separate financial performance and its separate cash flows for the years then ended in accordance with Korean International Financial Reporting Standards (“K-IFRS”).

We also have audited, in accordance with the Korean Standards on Auditing, the Company’s Internal Control over Financial Reporting as of December 31, 2023, based on criteria established in Conceptual Framework for Designing and Operating Internal Control over Financial Reporting issued by the Operating Committee of Internal Control over Financial Reporting in Korea, and our report dated March 7, 2024 expressed an unmodified opinion on the effectiveness of the Company’s internal control over financial reporting.

Basis for Opinion

We conducted our audits in accordance with Korean Standards on Auditing. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Separate Financial Statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the separate financial statements in the Republic of Korea, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the separate financial statements as of and for the year ended December 31, 2023. These matters were addressed in the context of our audit of the separate financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

(i) Impairment assessment for Display CGU

As discussed in Notes 3(I)(ii) and 10(d) to the separate financial statements, the Company’s non-financial assets which consist of property, plant and equipment and intangible assets amount to W15,267,276 million as of December 31, 2023. As a result of the annual impairment assessment for Display CGU to which goodwill is allocated, the Company concluded that recoverable amount exceeds the carrying amount.

The recoverable amount used by the Company in impairment assessment of the Display CGU is value in use based on discounted cash flow model. Revenue and operating expenditures for the forecast period and discount rate used to estimate value in use for impairment assessment of Display CGU involve significant judgement and minor changes to those assumptions would have a significant effect on the results of the Company’s impairment assessment of Display CGU. Therefore, we identified impairment assessment for Display CGU as a key audit matter.

The following are the primary procedures we performed to address this key audit matter.

•

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s non-financial assets impairment assessment process, and development of revenue and operating expenditures forecasts and discount rate assumption for Display CGU.

•

For the impairment assessment of Display CGU, we compared the Company’s historical revenue and operating expenditures forecasts to actual results to assess the Company’s ability to reliably forecast.

•

We evaluated the revenue and operating expenditures forecasts used to determine the value in use by comparison with the financial budgets approved by the board of directors.

•

We performed sensitivity analysis over discount rate assumption used to estimate value in use for impairment assessment of Display CGU to assess the impact of changes in that assumption on the Company’s impairment assessment.

•

We involved our valuation professionals with specialized skills and knowledge who assisted us in the following:

•

testing discount rate by comparing it against independently developed rate using publicly available market data for comparable entities; and

•

testing revenue and operating expenditures forecasts by comparing them against industry reports and historical performance of the Company.

(ii) Assessment of recognition of deferred tax assets

As discussed in Notes 3(t) and 25 to the separate financial statements, the deferred tax assets are recognized to the extent that it is probable that future taxable income will be available against which the deductible temporary differences, unused tax losses and unrecognized tax credit carryforwards can be utilized. The Company had W3,499,601 million of deferred tax assets and W869,364 million of unrecognized tax credit carryforwards, as of December 31, 2023.

We identified the assessment of the recognition of deferred tax assets as a key audit matter because it involves high degree of subjective management judgment in estimating future taxable profits over the periods in which the above mentioned differences become deductible and within the periods before the unused tax losses and tax credit carryforwards expired. The subjectivity is primarily driven by the Company’s assumptions in revenue and operating expenditures, which are used to estimate the forecasted taxable income in the future.

The following are the primary procedures we performed to address the key audit matter.

•

We evaluated the design and tested the operating effectiveness of certain internal control related to the Company’s deferred tax assets recognition process, including control related to the development of assumptions in determining the future taxable income for each year.

•

We analyzed the Company’s estimates of future taxable income, including analyzing the Company’s forecasted revenue and operating expenditures by comparing them with the financial budgets approved by the Board of Directors and historical performance.

•

We compared the forecasts of taxable income and utilization of tax credit carryforwards made in 2022 with the actual results in 2023 to assess the Company’s ability to reliably forecast.

•

We evaluated the Company’s assessment on the history of realizing deferred tax assets in connection with the unused tax losses carryforwards.

Other matter

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

Responsibilities of Management and Those Charged with Governance for the Separate Financial Statements

Management is responsible for the preparation and fair presentation of these separate financial statements in accordance with K-IFRS, and for such internal control as management determines is necessary to enable the preparation of separate financial statements that are free from material misstatement, whether due to fraud or error.

In preparing these separate financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Separate Financial Statements

Our objectives are to obtain reasonable assurance about whether these separate financial statements as a whole are free from material misstatements, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. ‘Reasonable assurance’ is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Korean Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these separate financial statements.

As part of an audit in accordance with Korean Standards on Auditing, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

•

Identify and assess the risks of material misstatement of the separate financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal control.

•

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances.

•

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

•

Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, then we are required to draw attention in our auditors’ report to the related disclosures in the separate financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company to cease to continue as a going concern.

•

Evaluate the overall presentation, structure and content of the separate financial statements, including the disclosures, and whether the separate financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and communicate with them all relationships and other matters that may reasonably be thought to bear on our independence and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the separate financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partner on the audit resulting in this independent auditors’ report is In Hye Kang.

KPMG Samjong Accounting Corp.

Seoul, Korea

March 7, 2024

This report is effective as of March 7, 2024, the audit report date. Certain subsequent events or circumstances, which may occur between the audit report date and the time of reading this report, could have a material impact on the accompanying separate financial statements and notes thereto. Accordingly, the readers of the audit report should understand that the above audit report has not been updated to reflect the impact of such subsequent events or circumstances, if any.

LG DISPLAY CO., LTD.

Separate Statements of Financial Position

As of December 31, 2023 and 2022


(In millions of won)	Note		December 31, 2023		December 31, 2022

Assets
Cash and cash equivalents		4, 27	W	334,502		692,312
Deposits in banks		4, 27		20,000		42,804
Trade accounts and notes receivable, net		5, 15, 27, 30		3,077,901		2,475,920
Other accounts receivable, net		5, 27		95,178		135,116
Other current financial assets		6, 27		163,137		149,479
Inventories		7		1,780,959		1,924,594
Prepaid income tax				1,954		1,092
Other current assets		5		116,851		205,860

Total current assets				5,590,482		5,627,177
Deposits in banks		4, 27		11		11
Investments		8		4,932,063		4,837,704
Other non-current accounts receivable, net		5, 27		13,833		13,364
Other non-current financial assets		6, 27		80,793		190,067
Property, plant and equipment, net		9, 28		13,584,247		14,044,844
Intangible assets, net		10		1,683,029		1,635,181
Investment Property		11, 28		32,995		28,269
Deferred tax assets		25		3,387,504		2,413,563
Defined benefits assets, net		13		407,212		447,521
Other non-current assets				20,243		21,338

Total non-current assets				24,141,930		23,631,862

Total assets			W	29,732,412		29,259,039


Liabilities
Trade accounts and notes payable		27, 30	W	8,993,964		8,391,251
Current financial liabilities		12, 27, 28, 29		3,850,822		4,014,046
Other accounts payable		27		2,334,289		2,813,350
Accrued expenses				461,819		558,503
Provisions		14		115,834		172,092
Advances received		15, 27		608,044		28,184
Other current liabilities				57,487		65,585

Total current liabilities				16,422,259		16,043,011
Non-current financial liabilities		12, 27, 28, 29, 30		5,985,874		5,119,695
Non-current provisions		14		63,805		86,157
Long-term advances received		15, 27		967,050		—
Other non-current liabilities		27		611,869		659,737

Total non-current liabilities				7,628,598		5,865,589

Total liabilities				24,050,857		21,908,600


Equity
Share capital		16	W	1,789,079		1,789,079
Share premium		16		2,251,113		2,251,113
Retained earnings		17		1,641,363		3,310,247

Total equity				5,681,555		7,350,439

Total liabilities and equity			W	29,732,412		29,259,039

See accompanying notes to the separate financial statements.

LG DISPLAY CO., LTD.

Separate Statements of Comprehensive Loss

For the years ended December 31, 2023 and 2022


(In millions of won, except earnings per share)	Note	2023			2022

Revenue	18, 30	W	19,811,015			24,131,172
Cost of sales	7, 19, 30		(21,446,905	)		(24,870,325	)

Gross loss			(1,635,890	)		(739,153	)

Selling expenses	19, 20		(280,262	)		(517,397	)
Administrative expenses	19, 20		(600,587	)		(582,717	)
Research and development expenses	19		(1,367,382	)		(1,362,196	)

Operating loss			(3,884,121	)		(3,201,463	)


Finance income	23		2,411,597			691,501
Finance costs	23		(877,350	)		(572,487	)
Other non-operating income	22		995,791			2,266,820
Other non-operating expenses	19, 22		(1,278,031	)		(2,598,888	)

Loss before income tax			(2,632,114	)		(3,414,517	)
Income tax benefit	24		(913,413	)		(223,130	)

Loss for the year			(1,718,701	)		(3,191,387	)


Other comprehensive income (loss)
Items that will never be reclassified to profit or loss
Remeasurements of net defined benefit liabilities	13, 24		49,817			122,361
Items that will be reclassified to profit or loss
Gain on valuation of derivative	24		—			9,227
Other comprehensive income (loss) for the year, net of income tax			49,817			131,588

Total comprehensive loss for the year		W	(1,668,884	)		(3,059,799	)

Loss per share (in won)
Basic loss per share	26	W	(4,803	)		(8,919	)
Diluted loss per share	26	W	(4,803	)		(8,919	)

See accompanying notes to the separate financial statements.

LG DISPLAY CO., LTD.

Separate Statements of Changes in Equity

For the years ended December 31, 2023 and 2022


(In millions of won)	Share capital		Share premium		Retained earnings			Other capital			Total equity

Balances at January 1, 2022	W	1,789,079		2,251,113		6,611,853			(9,227	)		10,642,818

Total comprehensive income (loss) for the year
Loss for the year		—		—		(3,191,387	)		—			(3,191,387	)
Other comprehensive income (loss)
Remeasurements of net defined benefit liabilities, net of tax		—		—		122,361			—			122,361
Gain on valuation of derivative		—		—		—			9,227			9,227

Total other comprehensive income (loss)		—		—		122,361			9,227			131,588

Total comprehensive loss for the year	W	—		—		(3,069,026	)		9,227			(3,059,799	)

Transaction with owners, recognized directly in equity
Dividends to equity holders	W	—		—		(232,580	)		—			(232,580	)

Balances at December 31, 2022	W	1,789,079		2,251,113		3,310,247			—			7,350,439


Balances at January 1, 2023	W	1,789,079		2,251,113		3,310,247			—			7,350,439

Total comprehensive loss for the year
Loss for the year		—		—		(1,718,701	)		—			(1,718,701	)
Other comprehensive income (loss)
Remeasurements of net defined benefit liabilities, net of tax		—		—		49,817			—			49,817

Total comprehensive loss for the year	W	—		—		(1,668,884	)		—			(1,668,884	)

Balances at December 31, 2023	W	1,789,079		2,251,113		1,641,363			—			5,681,555

See accompanying notes to the separate financial statements.

LG DISPLAY CO., LTD.

Separate Statements of Cash Flows

For the years ended December 31, 2023 and 2022


(In millions of won)	Note		2023			2022

Cash flows from operating activities:
Loss for the year			W	(1,718,701	)		(3,191,387	)
Adjustments for:
Income tax benefit		24		(913,413	)		(223,130	)
Depreciation and amortization		9, 10, 11, 19		2,328,219			2,376,274
Gain on foreign currency translation				(258,871	)		(636,163	)
Loss on foreign currency translation				170,190			332,495
Expenses related to defined benefit plans		13		147,537			166,479
Gain on disposal of property, plant and equipment				(33,842	)		(27,361	)
Loss on disposal of property, plant and equipment				102,297			53,904
Impairment loss on property, plant and equipment				8,521			339,374
Gain on disposal of intangible assets				(1,989	)		—
Loss on disposal of intangible assets				55			193
Impairment loss on intangible assets				54,833			92,313
Reversal of impairment loss on intangible assets				(242	)		(1,975	)
Impairment loss on investment property assets				—			7,736
Expense on increase of provisions				49,787			207,310
Finance income				(2,371,466	)		(647,287	)
Finance costs				861,067			550,634
Other income				(6,659	)		(1,652	)

				136,024			2,589,144

Changes in:
Trade accounts and notes receivable				(713,607	)		2,328,752
Other accounts receivable				46,739			(85,754	)
Inventories				143,635			206,403
Other current assets				97,879			(12,128	)
Other non-current assets				(189	)		(10,629	)
Trade accounts and notes payable				811,210			2,440,822
Other accounts payable				(80,411	)		(452,565	)
Accrued expenses				(105,247	)		(469,540	)
Provisions				(128,523	)		(213,868	)
Advances received				(370	)		(1,875	)
Other current liabilities				(29,774	)		(6,552	)
Defined benefit liabilities, net				(42,593	)		(379,860	)
Long term Advanced Received				1,580,222			—
Other non-current liabilities				33,891			166,893

				1,612,862			3,510,099
Cash generated from operating activities				30,185			2,907,856
Income taxes refunded (paid)				(76,208	)		57,834
Interests received				15,400			11,142
Interests paid				(610,152	)		(277,378	)


Net cash provided (used) by operating activities			W	(640,775	)		2,699,454

See accompanying notes to the separate financial statements.

LG DISPLAY CO., LTD.

Separate Statements of Cash Flows, Continued

For the years ended December 31, 2023 and 2022


(In millions of won)	Note		2023			2022

Cash flows from investing activities:
Dividends received			W	1,887,196			126,553
Increase in deposits in banks				(20,000	)		(42,804	)
Proceeds from withdrawal of deposits in banks				42,804			76,914
Acquisition of financial asset at fair value through profit or loss				—			(150	)
Acquisition of financial assets at fair value through other comprehensive income				(3,000	)		(3,934	)
Proceeds from disposal of financial assets at fair value through other comprehensive income				2,671			3,547
Acquisition of investments				(98,740	)		(33,137	)
Proceeds from disposal of investments				—			132,200
Acquisition of property, plant and equipment				(2,145,138	)		(3,820,388	)
Proceeds from disposal of property, plant and equipment				488,194			181,610
Acquisition of intangible assets				(650,877	)		(817,802	)
Proceeds from disposal of intangible assets				6,328			11,392
Proceeds from settlement of derivatives, net				178,610			49,145
Proceeds from collection of short-term loans				27,411			9,608
Increase in short-term loans				—			(9,643	)
Increase in long-term loans				—			(54,033	)
Increase in deposits				(354	)		(901	)
Decrease in deposits				134			4,125
Proceeds from disposal of other assets				6,659			1,464


Net cash used in investing activities				(278,102	)		(4,186,234	)


Cash flows from financing activities:		29
Proceeds from short-term borrowings				5,960,167			3,496,467
Repayments of short-term borrowings				(6,488,262	)		(1,550,937	)
Proceeds from issuance of bonds				469,266			443,230
Proceeds from long-term borrowings				2,839,878			1,523,669
Repayments of current portion of long-term borrowings and bonds				(2,212,164	)		(2,443,087	)
Payment guarantee fee received				7,195			4,945
Payment guarantee fee paid				(2,134	)		—
Dividends paid				—			(232,580	)
Repayments of lease liabilities				(12,879	)		(13,462	)


Net cash provided by financing activities				561,067			1,228,245


Net decrease in cash and cash equivalents				(357,810	)		(258,535	)
Cash and cash equivalents at January 1				692,312			950,847

Cash and cash equivalents at December 31			W	334,502			692,312

See accompanying notes to the separate financial statements.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

1.	Organization and Description of Business

LG Display Co., Ltd. (the “Company”) was incorporated in February 1985 and the Company is a public corporation listed in the Korea Exchange since 2004. The main business of the Company is to manufacture and sell displays and its related products. As of December 31, 2023, the Company is operating Thin Film Transistor Liquid Crystal Display (“TFT-LCD”) and Organic Light Emitting Diode (“OLED”) panel manufacturing plants in Gumi, Paju and China and TFT-LCD and OLED module manufacturing plants in Gumi, Paju, China and Vietnam. The Company is domiciled in the Republic of Korea with its address at 128 Yeouidae-ro, Yeongdeungpo-gu, Seoul, the Republic of Korea. As of December 31, 2023, LG Electronics Inc., a major shareholder of the Company, owns 37.9% (135,625,000 shares) of the Company’s common stock.

The Company’s common stock is listed on the Korea Exchange under the identifying code 034220. As of December 31, 2023, there are 357,815,700 shares of common stock outstanding. The Company’s common stock is also listed on the New York Stock Exchange in the form of American Depository Shares (“ADSs”) under the symbol “LPL”. One ADS represents one-half of one share of common stock. As of December 31, 2023, there are 18,672,956 ADSs outstanding.

2.	Basis of Presenting Financial Statements

(a)

Statement of Compliance

In accordance with the Act on External Audits of Stock Companies, Etc., these separate financial statements have been prepared in accordance with Korean International Financial Reporting Standards (“K-IFRS”).

These financial statements are separate financial statements prepared in accordance with K-IFRS No.1027, Separate Financial Statements, presented by a parent, an investor in an associate or a venture in a joint ventures, in which the investments are accounted for on the basis of the direct equity interest rather than on the basis of the reported results and net assets of the investees.

The separate financial statements were authorized for issuance by the Board of Directors on January 24, 2024, which will be submitted for approval to the shareholders’ meeting to be held on March 22, 2024.

(b)

Basis of Measurement

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

•

derivative financial instruments at fair value, financial assets at fair value through profit or loss(“FVTPL”), financial assets at fair value through other comprehensive income (“FVOCI”), financial liabilities at fair value through profit or loss(“FVTPL”), and

•

net defined benefit liabilities (defined benefit assets) recognized at the present value of defined benefit obligations less the fair value of plan assets

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

2.	Basis of Presenting Financial Statements, Continued

(c)

Functional and Presentation Currency

The separate financial statements are presented in Korean won, which is the Company’s functional currency.

(d)

Use of Estimates and Judgments

The preparation of the separate financial statements in conformity with K-IFRSs 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.

Information about judgments made applying accounting policies that have the most significant effects on the amounts recognized in the separate financial statements is included in the following notes:

•

Financial instruments (Note 3(f))

•

Intangible assets (Impairment assessment of non-financial assets, including determination of cash generating unit) (Note 3(l), 10)

•

Deferred tax assets and liabilities (recognition of deferred tax assets) (Note 3(t), 25)

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities within the next 12 months is included in the following notes:

•

Provisions (Note 3(n), 14)

•

Inventories (Note 3(e), 7)

•

Intangible assets (Impairment assessment of non-financial assets) (Note 10)

•

Employee benefits (Note 13)

•

Deferred tax assets and liabilities (estimation of future taxable income) (Note 3(t), 25)

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies

The Company has consistently applied the following accounting policies to all periods presented in these separate financial statements, except if mentioned otherwise.

(a)

Changes in Material Accounting policies

i) Global Minimum Tax

The Company has applied the International Tax Reform – Pillar Two Model Rules (Amendments to K-IFRS No. 1012 ‘Corporate Tax’) published in December 2023. The amendments provide a temporary mandatory exception from deferred tax accounting for the global minimum tax, and require new disclosure about the Pillar Two exposure. (See Note 24)

ii) Material accounting policy information

The Company adopted Disclosure of Accounting Policies (Amendments to K-IFRS No. 1001 ‘Presentation of Financial Statements’) from January 1, 2023. Although the amendments did not result in any changes to the accounting polices themselves, they impacted the accounting policy information disclosed in the financial statements. The amendments require disclosure of ‘material’ rather than ‘significant’, accounting policies. The amendments also provide guidance on the application of materiality to disclosure of accounting policies, assisting entities to provide useful, entity-specific accounting policy information that users need to understand other information in the financial statements.

The Company has reviewed the accounting policies and has updated the information disclosed in Note 3 (2022: Summary of Significant Accounting Policies) accordingly.

(b)

Interest in subsidiaries, associates and joint ventures

These separate financial statements are prepared and presented in accordance with K-IFRS No.1027, Separate Financial Statements. The Company applied the cost method to investments in subsidiaries, associates and joint ventures. Dividends from subsidiaries, associates or joint ventures are recognized in profit or loss when the right to receive the dividend is established.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(c)

Foreign Currency Transaction and Translation

Transactions in foreign currencies are translated to the functional currency of the Company at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are retranslated to the functional currency at the exchange rate on the reporting date. 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 originally determined. Foreign currency differences arising on retranslation are recognized in profit or loss, except for differences arising on an investment in equity instruments designated as at FVOCI and a financial asset and liability designated as a cash flow hedge, which are recognized in other comprehensive income. Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial recognition are recognized in profit or loss in the period in which they arise. Foreign currency differences arising from assets and liabilities in relation to the investing and financing activities including borrowings, bonds and cash and cash equivalents are recognized in finance income (costs) in the separate statement of comprehensive income (loss) and foreign currency differences arising from assets and liabilities in relation to activities other than investing and financing activities are recognized in other non-operating income (expense) in the separate statement of comprehensive income (loss). Foreign currency differences are presented in gross amounts in the separate statement of comprehensive income (loss)

(d)

Cash and cash equivalents

Cash and cash equivalents include all cash balances and short-term highly liquid investments with an original maturity of three months or less that are readily convertible into known amounts of cash.

(e)

Inventories

Inventories are measured at the lower of cost and net realizable value. The cost of inventories is based on the weighted-average method, and includes expenditures incurred in acquiring the inventories, production or conversion costs and other costs incurred in bringing them to their existing location and condition. Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated selling expenses. In the case of manufactured inventories and work-in-process, cost includes an appropriate share of production overheads based on the actual capacity of production facilities. However, the normal capacity is used for the allocation of fixed production overheads if the actual level of production is lower than the normal capacity.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(f)

Financial Instruments

(i) Non-derivative financial assets

Recognition and initial measurement

Trade receivables and debt instruments issued are initially recognized when they are originated. All other financial assets are recognized in statement of financial position when, and only when, the Company becomes a party to the contractual provisions of the instrument.

A financial asset (unless it is a trade receivable without a significant financing component) is initially measured at fair value plus, for an item not at FVTPL, transaction costs that are directly attributable to its acquisition or issue. A trade receivable without a significant financing component is initially measured at the transaction price.

Classification and subsequent measurement

i) Financial assets

On initial recognition, a financial asset is classified as measured at: amortized cost; FVOCI – debt investment; FVOCI – equity investments; or FVTPL. Financial assets are not reclassified subsequent to their initial recognition unless the Company changes its business model for managing financial assets, in which case all affected financial assets are reclassified on the first day of the subsequent reporting period following the change in the business model.

A financial asset is measured as at amortized cost if it meets both of the following conditions and is not designated as at FVTPL:

•

it is held within a business model whose objective is to hold assets to collect contractual cash flows; and

•

its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

A debt investment is measured at FVOCI if it meets both of the following conditions and is not designated as at FVTPL:

•

it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and

•

the contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

On initial recognition of an equity investments that is not held for trading, the Company may irrevocably elect to present subsequent changes in the investment’s fair value in OCI. This election is made on an investment-by-investment basis.

All financial assets not classified as measured at amortized cost or FVOCI as described above are measured as at FVTPL. This includes all derivative financial assets. At initial recognition, the Company may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortized cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(f)

Financial Instruments, Continued

ii) Financial assets: business model

The Company makes an assessment of the objective of the business model in which a financial asset is held at a portfolio level because this best reflects the way the business is managed and information is provided to management. The information considered includes:

•

the stated policies and objectives for the portfolio and the operation of those policies in practice (these include whether management’s strategy focuses on earning contractual interest income, maintaining a particular interest rate profile, matching the duration of the financial assets to the duration of any related liabilities or expected cash outflows or realizing cash flows through the sale of the assets);

•

how the performance of the portfolio is evaluated and reported to the Company’s management;

•

the risks that affect the performance of the business model (and the financial assets held within that business model) and how those risks are managed; and

•

the frequency, volume and timing of sales of financial assets in prior periods, the reasons for such sales and expectations about future sales activity.

Transfers of financial assets to third parties in transaction that do not qualify for derecognition are not considered sale for this purpose.

A financial asset that is held for trading or is managed and whose performance is evaluated on a fair value basis is measured at FVTPL.

iii) Financial assets: Assessment whether contractual cash flows are solely payments of principal and interest

For the purpose of the assessment, “principal” is defined as the fair value of the financial asset on initial recognition. ‘Interest’ is defined as consideration for the time value of money and for the credit risk associated with the principal amount outstanding during a particular period of time and for other basic lending risks and cost (e.g. liquidity risk and administrative costs), as well as profit margin.

In assessing whether the contractual cash flows are solely payments of principal and interest, the Company considers the contractual terms of the instrument. This includes assessing whether the financial asset contains a contractual term that could change the timing or amount of contractual cash flows such that it would not meet this condition. In making this assessment, the Company considers.

•

contingent events that would change the amount or timing of cash flows:

•

terms that may adjust the contractual coupon rate, including variable-rate features;

•

prepayment and extension features; and

•

terms that limit the Company’s claim to cash flows from specified assets (e.g. non-recourse features)

A prepayment feature is consistent with the solely payments of principal and interest criterion if the prepayment amount substantially represents unpaid amounts of principal and interest or the principal amount outstanding, which may include reasonable additional compensation for early termination of the contract.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(f)

Financial Instruments, Continued

Additionally, for a financial asset acquired at a discount or premium to its contractual par amount, a feature that permits or requires prepayment at an amount that substantially represents the contractual par amount plus accrued but unpaid contractual interest (which may also include reasonable additional compensation for early termination) is treated as consistent with this criterion if the fair value of the prepayment feature is insignificant at initial recognition.

iv) Financial assets: Subsequent measurement and gains and losses


Financial assets at FVTPL		These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognized in profit or loss.

Financial assets at amortized cost		These assets are subsequently measured at amortized cost using the effective interest method. The amortized cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are recognized in profit or loss. Any gain or loss on derecognition is recognized in profit or loss.

Debt investments at FVOCI		These assets are subsequently measured at fair value. Interest income calculated using the effective interest method, foreign exchange gains and losses and impairment are recognized in profit or loss. Other net gains and losses are recognized in OCI. On derecognition, gains and losses accumulated in OCI are reclassified to profit or loss.

Derecognition

The Company derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, it transfers the rights to receive the contractual cash flows of the financial asset in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred, or it transfers or does not retain substantially all the risks and rewards of ownership of a transferred asset, and does not retain control of the transferred asset.

If the Company has retained substantially all the risks and rewards of ownership of the transferred asset, the Company continues to recognize the transferred asset.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(f)

Financial Instruments, Continued

(ii) Non-derivative financial liabilities

The Company classifies financial liabilities into two categories, financial liabilities at FVTPL and other financial liabilities in accordance with the substance of the contractual arrangement and the definitions of financial liabilities, and recognizes them in the separate statement of financial position when the Company becomes a party to the contractual provisions of the instrument.

Financial liabilities at FVTPL include financial liabilities held for trading or designated as such upon initial recognition at FVTPL. After initial recognition, financial liabilities at FVTPL are measured at fair value, and changes therein are recognized in profit or loss. Upon initial recognition, transaction costs that are directly attributable to the issuance of financial liabilities are recognized in profit or loss as incurred.

Non-derivative financial liabilities other than financial liabilities classified as at FVTPL are classified as other financial liabilities and measured initially at fair value minus transaction costs that are directly attributable to the issuance of financial liabilities. Subsequent to initial recognition, these financial liabilities are measured at amortized cost using the effective interest method. As of December 31, 2023, non-derivative financial liabilities comprise borrowings, bonds, trade accounts and notes payable, other accounts payable and others.

The Company derecognizes a financial liability when its contractual obligations are discharged, cancelled or expired.

(iii) Share Capital

The Company issued common stocks and they are classified as equity. Incremental costs directly attributable to the issuance of common stocks are recognized as a deduction from equity, net of tax effects. Capital contributed in excess of par value upon issuance of common stocks is classified as share premium within equity.

(iv) Derivative financial instruments

Derivatives are initially recognized at fair value. Subsequent to initial recognition, derivatives are measured at fair value, and changes therein are accounted for as described below.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(f)

Financial Instruments, Continued

Hedge Accounting

If necessary, the Company designates derivatives as hedging items to hedge the risk of changes in the fair value of assets, liabilities or firm commitments (a fair value hedge) and foreign currency risk of highly probable forecasted transactions or firm commitments (a cash flow hedge).

On initial designation of the hedge, the Company’s management formally designates and documents the relationship between the hedging instrument(s) and hedged item(s), including the risk management objectives and strategy in undertaking the hedge transaction, together with the methods that will be used to assess the effectiveness of the hedging relationship, both at the inception of the hedge relationship as well as on an ongoing basis.

i) Fair value hedges

Change in the fair value of a derivative hedging instrument designated as a fair value hedge and the hedged item is recognized in profit or loss, respectively. The gain or loss from remeasuring the hedging instrument at fair value and the gain or loss on the hedged item attributable to the hedged risk are recognized in profit or loss in the same line item of the statement of comprehensive income (loss). The Company discontinues fair value hedge accounting if it does not designate the derivative hedging instrument and the hedged item as the hedge relationship between them anymore; if the hedging instrument expires or is sold, terminated or exercised; or if the hedge no longer meets the criteria for hedge accounting.

ii) Cash flow hedges

When a derivative designated as a cash flow hedging instrument meets the criteria of cash flow hedge accounting, the effective portion of changes in the fair value of the derivative is recognized in other comprehensive income and the ineffective portion of changes in the fair value of the derivative is recognized in profit or loss. The Company discontinues cash flow hedge accounting if it does not designate the derivative hedging instrument and the hedged item as the hedge relationship between them anymore; if the hedging instruments expires or is sold, terminated or exercised; or if the hedge no longer meets the criteria for hedge accounting. The cumulative gain or loss on the hedging instrument that has been recognized in other comprehensive income is reclassified to profit or loss in the periods during which the forecasted transaction occurs. If the forecasted transaction is no longer expected to occur, then the balance in other comprehensive income is recognized immediately in profit or loss.

The Company is applying cash flow hedge accounting by designating expected foreign currency denominated sales arising from forecast export transactions as hedging items and the derivative instruments related to forward exchange as hedging instruments. The effective portion of changes in the fair value of the derivative is recognized in equity and the amount accumulated in equity is reclassified to revenue in the same period which forecast sales occur.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(f)

Financial Instruments, Continued

Embedded derivative

Embedded derivatives are separated from the host contract and accounted for separately if the host contract is not a financial asset and certain criteria are met.

Other derivative financial instruments

Other derivative financial instruments are measured at fair value and changes of their fair value are recognized in profit or loss.

(g)

Property, Plant and Equipment

(i) Recognition and measurement

Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. Cost includes an expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labor, any costs directly attributable to bringing the assets to a working condition for their intended use, the costs of dismantling and removing the items and restoring the site on which they are located and borrowing costs on qualifying assets.

The gain or loss arising from the derecognition of an item of property, plant and equipment is determined as the difference between the net disposal proceeds, if any, and the carrying amount of the item and recognized in other non-operating income or other non-operating expenses.

(ii) Subsequent costs

Subsequent expenditure on an item of property, plant and equipment is recognized as part of its cost only 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 costs of the day-to-day servicing of property, plant and equipment are recognized in profit or loss as incurred.

(iii) Depreciation

Land is not depreciated and depreciation of other items of property, plant and equipment is recognized in profit or loss on a straight-line basis, reflecting the pattern in which the asset’s future economic benefits are expected to be consumed by the Company. The residual value of property, plant and equipment is zero.

Estimated useful lives of the assets are as follows:


		Estimated useful lives (years)
Buildings and structures		20~40
Machinery		4, 5
Furniture and fixtures		4
Equipment, tools and vehicles		2, 4, 12
Right-of-use assets		(*)

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(g)

Property, Plant and Equipment, Continued

(*)

The Company depreciates the right-of-use assets from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term.

Depreciation methods, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate and any changes are accounted for as changes in accounting estimates.

(h)

Borrowing Costs

The Company capitalizes borrowing costs, which includes interests and exchange differences arising from foreign currency borrowings to the extent that they are regarded as an adjustment to interest costs, directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset. A qualifying asset is an asset that necessarily takes a substantial period of time to get ready for its intended use or sale. To the extent that the Company borrows funds specifically for the purpose of obtaining a qualifying asset, the Company determines the amount of borrowing costs eligible for capitalization as the actual borrowing costs incurred on that borrowing during the period less any investment income on the temporary investment of those borrowings. The Company immediately recognizes other borrowing costs as an expense.

(i)

Government Grants

In case there is reasonable assurance that the Company will comply with the conditions attached to a government grant, the government grant is recognized as follows:

(i) Grants related to the purchase or construction of assets

A government grant related to the purchase or construction of assets is 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 and cash related to grant received is presented in investing activities in the statement of cash flows.

(ii) Grants for compensating the Company’s expenses incurred

A government grant that compensates the Company for expenses incurred is recognized in profit or loss as a deduction from relevant expenses on a systematic basis in the periods in which the expenses are recognized.

(iii) Other government grants

A government grant that becomes receivable for the purpose of giving immediate financial support to the Company with no compensation for expenses or losses already incurred or no future related costs is recognized as income of the period in which it becomes receivable.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(j)

Intangible Assets

Intangible assets are initially measured at cost. Subsequently, intangible assets are measured at cost less accumulated amortization and accumulated impairment losses.

(i) Goodwill

Goodwill arising from business combinations is recognized as the excess of the acquisition cost of a business over the net fair value of the identifiable assets acquired and liabilities assumed. Any deficit is a bargain purchase that is recognized in profit or loss. Goodwill is measured at cost less accumulated impairment losses.

(ii) Research and development

Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge and understanding, is recognized in profit or loss as incurred.

Development activities involve a plan or design of the production of new or substantially improved products and processes. Development expenditure is capitalized as intangible assets only if the Company can demonstrate all of the following:

•

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

•

its intention to complete the intangible asset and use or sell it,

•

its ability to use or sell the intangible asset,

•

how the intangible asset will generate probable future economic benefits (among other things, the Company can demonstrate the usefulness of the intangible asset by existence of a market for the output of the intangible asset or the intangible asset itself if it is to be used internally),

•

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

•

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

Development projects are divided into research activities and development activities. Expenditures on research activities are recognized in profit or loss and qualifying development expenditures on development activities are capitalized.

The expenditure capitalized includes the cost of materials, direct labor and overhead costs that are directly attributable to preparing the asset for its intended use, and borrowing costs on qualifying assets.

(iii) Other intangible assets

Other intangible assets include intellectual property rights, software, customer relationships, technology, memberships and others. The Company currently has a number of patent license agreements related to product production. When the amount of payments for the entire contract period can be reliably determined, the total undiscounted amount is recognized as intangible assets as intellectual property rights and other account payables, respectively, and the intangible assets are amortized on a straight-line basis over the patent license period.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(j)

Intangible Assets, Continued

(iv) Subsequent costs

Subsequent expenditures are capitalized only when they increase the future economic benefits embodied in the specific intangible asset to which they relate. All other expenditures, including expenditures on internally generated goodwill and brands, are recognized in profit or loss as incurred.

(v) Amortization

Amortization is calculated on a straight-line basis over the estimated useful lives of intangible assets, other than goodwill, from the date that they are available for use. The residual value of intangible assets is zero. However, as there are no foreseeable limits to the periods over which condominium and golf club memberships are expected to be available for use, these intangible assets are regarded as having indefinite useful lives and not amortized.


		Estimated useful lives (years)
Intellectual property rights		5, 10, (*1)
Rights to use electricity, water and gas supply facilities		10
Software		4, (*1)
Customer relationships		7, 10
Technology		10
Development costs		(*2)
Condominium and golf club memberships		Indefinite

(*1)

Patent royalty (included in intellectual property rights) and software license are amortized over the useful lives considering the contract period.

(*2)

Capitalized development costs are amortized over the useful lives considering the life cycle of the developed products. Amortization of capitalized development costs are recognized in research and development expenses in the separate statement of comprehensive income (loss).

Amortization periods and the amortization methods for intangible assets with finite useful lives are reviewed at each financial year-end. The useful lives of intangible assets with indefinite useful lives are reviewed at each financial year-end to determine whether events and circumstances continue to support indefinite useful life assessments for those assets. If appropriate, the changes are accounted for as changes in accounting estimates.

(k)

Investment Property

Property held to earn rentals or for capital appreciation or both is classified as investment property. Investment properties are initially measured at cost, including transaction costs incurred at the time of acquisition, and subsequently, measured at cost less accumulated depreciation and accumulated impairment loss.

Subsequent expenditure on an item of investment property is recognized as part of its cost only 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 those parts that are replaced is derecognized. All other subsequent expenditures are expensed in the period in which it is incurred.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(k)

Investment Property, Continued

Among investment properties, land is not depreciated, and investment properties except land are depreciated on a straight-line basis by applying 20 years of the building according to the economic depreciation period. Depreciation methods, useful lives and residual values of investment properties are reviewed at each reporting period-end and if appropriate, the changes are accounted for as changes in accounting estimates.

(l)

Impairment

(i) Financial assets

Financial instruments and contract assets

The Company recognizes loss allowance for financial assets measured at amortized cost and debt investments at FVOCI at the ‘expected credit loss’ (ECL).

The Company recognizes a loss allowance for the life-time expected credit losses except for following, which are measured at 12-month ECLs:

•

debt instruments that are determined to have low credit risk at the reporting date; and

•

other debt instruments and bank deposits for which credit risk (i.e. the risk of default occurring over the expected life of the financial instrument) has not increased significantly since initial recognition.

When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECLs, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both qualitative and quantitative information and analysis, based on the Company’s historical experience and informed credit assessment including forward-looking information.

Lifetime ECLs are the ECLs that result from all possible default events over the expected life of a financial instrument.

12-month ECLs are the portion of the ECLs that result from default events that are possible within the 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months).

The maximum period considered when estimating ECLs is the maximum contractual period over which the Company is exposed to credit risk.

Estimation of expected credit losses

Expected credit losses are a probability-weighted estimate of credit losses. Credit losses are measured using the present value of the difference between the contractual cash flows and the expected contractual cash flows. The expected credit losses are discounted using effective interest rate of the financial assets.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(l)

Impairment, Continued

Credit-impaired financial assets

At each reporting period-end, the Company assesses whether financial assets carried at amortized cost and debt instruments at FVOCI are credit-impaired. A financial asset is ‘credit-impaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

Evidence that a financial asset is credit-impaired includes the following observable data:

•

significant financial difficulty of the issuer or the borrower;

•

the lender(s) of the borrower, for economic or contractual reasons relating to the borrower’s financial difficulty, having granted to the borrower a concession(s) that the lender(s) would not otherwise consider;

•

it is probable that the borrower will enter bankruptcy or other financial reorganization; or

•

the disappearance of an active market for a security because of financial difficulties.

Presentation of loss allowance for ECL in the statement of financial position

Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets. For debt instruments at FVOCI, the loss allowance is charged to profit or loss and is recognized in OCI instead of reducing the carrying amount of financial assets in the separate statement of financial position.

Write-off

The gross carrying amount of a financial asset is written off when the Company has no reasonable expectations for recovering the financial asset in its entirety or a portion thereof. The Company assess whether there are reasonable expectations of recovering the contractual cash flows from customers and individually assess the timing and amount of write-off. The Company expects no significant recovery from the amount written-off. However, financial assets that are written off could still be subject to enforcement activities in order to comply with the Company’s procedures for recovery of amounts due.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(l)

Impairment, Continued

(ii) Non-financial assets

The carrying amounts of the Company’s non-financial assets, other than assets arising from employee benefits, inventories and deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. For goodwill, and intangible assets that have indefinite useful lives or that are not yet available for use, irrespective of whether there is any indication of impairment, the recoverable amount is estimated each year.

Recoverable amount is estimated for the individual asset. If it is not possible to estimate the recoverable amount of the individual asset, the Company determines the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit (“CGU”) is the smallest group of assets that includes the asset and generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. In identifying whether cash inflows from an asset or group of assets are largely independent of the cash inflows from other assets or groups of assets, the Company considers various factors including how management monitors the entity’s operations or how management makes decisions about continuing or disposing of the entity’s assets and operations. In the Company’s separate financial statements, each CGU is comprised of a group of assets of the Company and its other subsidiaries, because the non-current assets of the Company generate independent cash inflows only in combination with certain assets of the subsidiary. In the separate financial statements, in general, investment in each subsidiary is considered to be individual CGUs. Goodwill arising from a business combination is allocated to CGUs or groups of CGUs that are expected to benefit from the synergies of the combination. The recoverable amount of an asset or cash-generating unit is determined as the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. Fair value less costs to sell is based on the best information available to reflect the amount that the Company could obtain from the disposal of the asset in an arm’s length transaction between knowledgeable, willing parties, after deducting the costs of disposal.

An impairment loss is recognized if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognized in profit or loss. Impairment losses recognized in respect of a CGU are allocated first to reduce the carrying amount of any goodwill allocated to the unit, and then to reduce the carrying amounts of the other assets in the unit on a pro rata basis.

In respect of assets other than goodwill, impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. 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 accumulated depreciation or amortization, if no impairment loss had been recognized from the acquisition cost. An impairment loss in respect of goodwill is not reversed.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(m)

Leases

A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

(i) As a lessee

At commencement or on modification of a contract that contains a lease component, the Company allocates the consideration in the contract to each lease and non-lease component on the basis of its relative stand-alone price. For certain leases, the Company accounts for the lease and non-lease components as a single lease component by applying the practical expedient not to separate non-lease components.

The Company recognizes a right-of-use asset and lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at of before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located less any lease incentives received.

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term, unless the lease transfers ownership of the underlying asset to the Company by the end of the lease term or the cost of the right-of-use asset reflects that the Company will exercise a purchase option. In that case, the right-of-use asset will be depreciated over the useful life of the underlying asset, which is determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate. Generally, the Company uses its incremental borrowing rate as the discount rate.

The Company determines its incremental borrowing rate by obtaining interest rates from various external financing sources and makes certain adjustments to reflect the terms of the lease and type of the asset leased.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(m)

Lease, Continued

Lease payments included in the measurement of the lease liability comprise the following:

•

fixed payments, including in-substance fixed payments;

•

variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;

•

amounts expected to be payable under a residual value guarantee; and

•

the exercise price under a purchase option that the Company is reasonably certain to exercise, lease payments in an optional renewal period if the Company is reasonably certain to exercise an extension option, and penalties for early termination of a lease unless the Company is reasonably certain not to terminate early.

The lease liability is measured at amortized cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Company’s estimate of the amount expected to be payable under a residual value guarantee, if the Company changes its assessment of whether it will exercise a purchase, extension or termination option or if there is a revised in-substance fixed lease payment.

When the lease liability is remeasured the Company recognizes the amount of the remeasurement of the lease liability as an adjustment to the right-of-use asset. However, if the carrying amount of the right-of-use asset is reduced to zero and there is a further reduction in the measurement of the lease liability, the Company recognizes any remaining amount of the remeasurement in profit or loss.

The Company presents right-of-use assets that do not meet the definition of investment property in ‘property, plant and equipment’ and lease liabilities in ‘financial liabilities’ in the separate statement of financial position.

The Company has elected not to recognize right-of-use assets and lease liabilities for leases of low-value assets and short-term leases. The Company recognizes the lease payments associated with these leases as an expense on a straight-line basis over the lease term.

(ii) As a lessor

When the Company acts as a lessor, it determines at lease inception whether each lease is a finance lease or an operating lease.

To classify each lease, the Company makes an overall assessment of whether the lease transfers substantially all of the risks and rewards incidental to ownership of the underlying asset. If the lease transfers substantially all of the risks and rewards incidental to ownership of the underlying asset, then the lease is a finance lease; if not, then it is an operating lease. As part of this assessment, the Company considers certain indicators such as whether the lease is for the major part of the economic life of the asset.

When the Company is an intermediate lessor, it accounts for its interests in the head lease and the sub-lease separately. It assesses the lease classification of a sub-lease with reference to the right-of-use asset arising from the head lease, not with reference to the underlying asset. If a head lease is a short-term lease to which the Company applies the exemption described above, then it classifies the sub-lease as an operating lease.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(m)

Lease, Continued

If an arrangement contains lease and non-lease components, then the Company applies K-IFRS No. 1115 to allocate the consideration in the contract.

At the commencement date, the Company recognizes assets held under a finance lease in its statement of financial position and present them as a receivable at an amount equal to the net investment in the lease and recognize finance income over the lease term, based on a pattern reflecting a constant periodic rate of return on the lessor’s net investment in the lease.

The Company recognizes lease payments received under operating leases as income on a straight-line basis over the lease term as part of ‘other revenue’.

(n)

Provisions

A provision is recognized, as a result of a past event, if the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation.

The risks and uncertainties that inevitably surround 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. The unwinding of the discount is recognized as finance cost.

Provisions are reviewed at the end of each reporting period and adjusted to reflect the current best estimate. 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.

The Company recognizes a liability for warranty obligations based on the estimated costs expected to be incurred under its basic limited warranty. This warranty covers defective products and is normally applicable for a warranty period from the date of purchase. These liabilities are accrued when product revenues are recognized. Factors that affect the Company’s warranty liability include historical and anticipated rates of warranty claims on those repairs and cost per claim to satisfy the Company’s warranty obligation. Warranty costs primarily include raw materials and labor costs. As these factors are impacted by actual experience and future expectations, management periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. Accrued warranty obligations are included in the current and non-current provisions.

Liabilities for loss contingencies arising from claims, assessments, litigation, fines, penalties and other sources, are recorded when it is probable that a liability has been incurred and the amount of the assessment and/or remediation can be reasonably estimated.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(o)

Non-current Assets Held for Sale

Non-current assets, or disposal groups comprising assets and liabilities, are classified as held-for-sale if it is highly probable that they will be recovered primarily from sale rather than through continuing use. In order to be classified as held for sale, the asset (or disposal group) is available for immediate sale in its present condition and its sale is highly probable. The assets (or disposal groups) that are classified as non-current assets held for sale are measured at the lower of their carrying amount and fair value less costs to sell on initial classification. The Company recognizes an impairment loss for any subsequent decrease in fair value of the asset (or disposal group) for which an impairment loss was recognized on initial classification as held-for-sale and a gain for any subsequent increase in fair value in profit or losses, up to the cumulative impairment loss previously recognized.

The Company does not depreciate a non-current asset while it is classified as held for sale or while it is part of a disposal group classified as held for sale.

(p)

Employee Benefits

(i) Short-term employee benefits

Short-term employee benefits that are due to be settled within twelve months after the end of the period in which the employees render the related service are recognized in profit or loss on an undiscounted basis. The expected cost of profit-sharing and bonus plans and others are recognized when the Company has a present legal or constructive obligation to make payments as a result of past events and a reliable estimate of the obligation can be made.

(ii) Other long-term employee benefits

The Company’s net obligation in respect of long-term employee benefits other than pension plans is the amount of future benefit that employees have earned in return for their service in the current and prior periods.

(iii) Defined contribution plan

A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution pension plans are recognized as an employee benefit expense in profit or loss in the period during which services are rendered by employees.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(p)

Employee Benefits, continued

(iv) Defined benefit plan

A defined benefit plan is a post-employment benefit plan other than defined contribution plans. The Company’s net obligation in respect of its defined benefit plan is calculated by estimating the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value. The fair value of any plan assets is deducted.

The calculation is performed annually by an independent actuary using the projected unit credit method. The discount rate is the yield at the reporting date on high quality corporate bonds that have maturity dates approximating the terms of the Company’s obligations and that are denominated in the same currency in which the benefits are expected to be paid. The Company recognizes all actuarial gains and losses arising from defined benefit plans in retained earnings immediately.

The Company determines the net interest expense (income) on the net defined benefit liability (asset) for the period by applying the discount rate used to measure the defined benefit obligation at the beginning of the annual period to the then-net defined benefit liability (asset), taking into account any changes in the net defined benefit liability (asset) during the period as a result of contributions and benefit payments. Consequently, the net interest on the net defined benefit liability (asset) now comprises: interest cost on the defined benefit obligation, interest income on plan assets, and interest on the effect on the asset ceiling.

When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognized immediately in profit or loss. The Company recognizes gains and losses on the settlement of a defined benefit plan when the settlement occurs.

(v) Termination benefits

The Company recognizes expense for termination benefits at the earlier of the date when the entity can no longer withdraw the offer of those benefits and when the entity recognizes costs for a restructuring involving the payment of termination benefits. If the termination benefits are not expected to be settled wholly before twelve months after the end of the annual reporting period, the Company measures the termination benefit with present value of future cash payments.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(q)

Revenue from contracts with customers

Revenue from the sale of goods in the course of ordinary activities is measured at the fair value of the consideration received or receivable, net of estimated returns, trade discounts, volume rebates and other cash incentives paid to customers.

The Company recognizes revenue according to the five-stage revenue recognition model (① Identifying the contractg② Identifying performance obligationsg③ Determining transaction priceg④ Allocating the transaction price to performance obligationsg⑤ Recognizing revenue for performance obligations).

The Company generates revenue primarily from sale of display panels. Product revenue is recognized when a customer obtains control over the Company’s products, which typically occurs upon shipment or delivery depending on the terms of the contracts with the customer.

The Company includes return option in the sales contract of display panels with its customers and the consideration receivable from the customer is subject to change due to returns. The Company estimates an amount of variable consideration by using the expected value method which the Company expects to better predict the amount of consideration. The Company includes in the transaction price an amount of variable consideration estimated only to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur during the return period when the uncertainty associated with the variable consideration is subsequently resolved. The Company recognizes a refund liability and an asset for its right to recover products from customers if the Company receives consideration from a customer and expects to refund some or all of that consideration to the customer. Sales taxes or value-added taxes collected from customers and remitted to governmental authorities are accounted for on a net basis and are excluded from revenues in the separate statement of comprehensive income (loss).

(r)

Operating Segments

In accordance with K-IFRS No. 1108, Operating Segments, entity wide disclosures of geographic and product revenue information are provided in the consolidated financial statements.

(s)

Finance Income and Finance Costs

Finance income comprises interest income on funds invested (including debt instruments measured at FVOCI), dividend income, gains on disposal of debt instruments measured at FVOCI and changes in fair value of financial instruments at FVTPL. Interest income is recognized as it accrues in profit or loss, using the effective interest method. Dividend income is recognized in profit or loss on the date that the Company’s right to receive payment is established.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(s)

Finance Income and Finance Costs, Continued

Finance costs comprise interest expense on borrowings, unwinding of the discount on provisions, gain and losses from financial instruments measured at FVTPL and impairment losses recognized on financial assets. Borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset are capitalized as part of the cost of that asset.

(t)

Income Tax

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.

(i) Current tax

Current tax comprises the expected tax payable or receivable on the taxable profit or loss for the year, using tax rates enacted or substantively enacted at the reporting date and any adjustment to tax payable in respect of previous years. The amount of current tax payable or receivable is the best estimate of the tax amount expected to be paid or received that reflects uncertainty related to income taxes, if any. 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 and 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. 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.

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 differences and it is probable that the temporary differences will not reverse in the foreseeable future. A deferred tax asset is recognized for all deductible temporary differences to the extent that it is probable that the differences relating to investments in subsidiaries, associates and joint ventures will reverse in the foreseeable future and taxable profit will be available against which the temporary difference can be utilized.

Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

The Company offsets deferred tax assets and deferred tax liabilities if, and only if, the Company has a legally enforceable right to set off current tax assets against current tax liabilities and the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

3.	Material Accounting Policies, Continued

(u)

Earnings (Loss) Per Share

The Company presents basic and diluted earnings (loss) per share (“EPS”) data for its common shares. Basic EPS is calculated by dividing the profit or loss attributable to common shareholders of the Company by the weighted average number of common shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to common shareholders and the weighted average number of common shares outstanding, adjusted for the effects of all dilutive potential common shares such as convertible bonds and others.

(v)

Accounting standards issued but not yet effective

A number of new accounting standards are effective for annual periods beginning after January 1, 2023 and earlier application is permitted; However, the Company has not early adopted the following new or amended accounting standards in preparing these separate financial statements.

(i)

Classification of Liabilities as Current or Non-Current Liabilities with Covenants (Amendments to K-IFRS No. 1001 ‘Presentation of Financial Statements’)

The amendments aim to clarify the requirements the determining whether a liability is current or non-current and require new disclosure for non-current liabilities that are not subject to future covenants. The amendments are effective for annual reporting periods beginning on or after January 1, 2024.

The Company has borrowings that are subject to specific covenants. The Company is in the process of assessing the impact of the amendments to meet the new disclosure requirements.

(ii)

Supplier Finance Arrangements (Amendments to K-IFRS No. 1007 ‘Statement of Cash Flow’ and K-IFRS No. 1107 ‘Financial Instruments: Disclosures’)

The amendments introduce new disclosure relating to supplier finance arrangements that assist users of the financial statements to assess the effects of these arrangements on an entity’s liabilities and cash flows and on the entity’s exposure to liquidity risk. The amendments are effective for annual reporting periods beginning on or after January 1, 2024.

The Company participates in supply chain financing arrangements for which the new disclosures will apply. The Company is in the process of assessing the impact of the amendments to meet the new disclosure requirements.

(iii)

The following new and amended standards are not expected to have a significant impact on the Company’s separate financial statements.

•

Lease Liability in a Sale and Leaseback (Amendments to K-IFRS No. 1116, ‘Lease’.)

•

Lack of Exchangeability (Amendments to K-IFRS No. 1201, ‘The Effects of Changes in Foreign Exchange Rates’.)

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

4.	Cash and Cash Equivalents and Deposits in Banks

Cash and cash equivalents and deposits in banks as of December 31, 2023 and December 31, 2022 are as follows:


(In millions of won)
	December 31, 2023		December 31, 2022
Current assets
Cash and cash equivalents
Deposits	W	334,502		692,312
Deposits in banks
Restricted deposits (*)	W	20,000		42,804
Non-current assets
Deposits in banks
Restricted deposits (*)	W	11		11

(*)

Includes funds deposited under agreements on mutually beneficial cooperation to aid LG Group companies’ suppliers.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

5.	Trade Accounts and Notes Receivable, Other Accounts Receivable and Others

(a)

Trade accounts and notes receivable as of December 31, 2023 and December 31, 2022 are as follows:


(In millions of won)
	December 31, 2023		December 31, 2022
Due from third parties	W	172,109		173,644
Due from related parties		2,905,792		2,302,276

	W	3,077,901		2,475,920

(b)

Other accounts receivable as of December 31, 2023 and December 31, 2022 are as follows:


(In millions of won)
	December 31, 2023		December 31, 2022
Current assets
Non-trade receivables, net	W	94,936		133,991
Accrued income		242		1,125

	W	95,178		135,116

Non-current assets
Long-term non-trade receivables	W	13,833		13,364

	W	109,011		148,480

Due from related parties included in other accounts receivable, as of December 31, 2023 and 2022 are W55,593 million and W51,948 million, respectively.

(c)

The aging of trade accounts and notes receivable and other accounts receivable as of December 31, 2023 and December 31, 2022 are as follows:


(In millions of won)	December 31, 2023
	Book value				Allowance for impairment
	Trade accounts and notes receivable		Other accounts receivable		Trade accounts and notes receivable			Other accounts receivable
Current	W	3,074,502		105,816		(234	)		(62	)
1-15 days past due		198		1,357		—			—
16-30 days past due		3,435		156		—			(2	)
31-60 days past due		—		168		—			(2	)
More than 60 days past due		—		1,592		—			(12	)

	W	3,078,135		109,089		(234	)		(78	)

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

5.	Trade Accounts and Notes Receivable, Other Accounts Receivable and Others, Continued


(In millions of won)	December 31, 2022
	Book value				Allowance for impairment
	Trade accounts and notes receivable		Other accounts receivable		Trade accounts and notes receivable			Other accounts receivable
Current	W	2,462,872		144,950		(200	)		(1,362	)
1-15 days past due		922		933		—			(9	)
16-30 days past due		—		—		—			—
31-60 days past due		—		79		—			—
More than 60 days past due		12,355		3,936		(29	)		(47	)

	W	2,476,149		149,898		(229	)		(1,418	)

The movement in the allowance for impairment in respect of trade accounts and notes receivable and other accounts receivable for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)	2023					2022
	Trade accounts and notes receivable		Other accounts receivable			Trade accounts and notes receivable		Other accounts receivable
Balance at the beginning of the year	W	229		1,418			11		1,496
(Reversal of) bad debt expense		5		(8	)		218		(78	)
Write-off		—		(1,332	)		—		—

Balance at the end of the year	W	234		78			229		1,418

(d)

Other current assets as of December 31, 2023 and December 31, 2022 are as follows:


(In millions of won)
	December 31, 2023		December 31, 2022
Advanced payments	W	1,220		21,658
Prepaid expenses		71,382		51,822
Value added tax refundable		39,128		124,225
Right to recover returned goods		5,121		8,155

	W	116,851		205,860

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

6.	Other Financial Assets

Other financial assets as of December 31, 2023 and 2022 are as follows:


(In millions of won)
	December 31, 2023		December 31, 2022
Current assets
Financial assets at fair value through profit or loss
Derivatives(*)	W	136,762		119,417

Financial assets carried at amortized cost
Short-term loans	W	26,375		30,062

	W	163,137		149,479

Non-current assets
Financial assets at fair value through profit or loss
Equity instruments	W	3,967		10,484
Convertible securities		1,838		1,797
Derivatives(*)		32,941		110,663

	W	38,746		122,944

Financial assets carried at amortized cost
Deposits	W	8,538		8,317
Long-term loans		33,509		58,806

	W	42,047		67,123

	W	80,793		190,067

(*)

Represents cross currency interest rate swap contracts and others entered into by the Company to hedge currency and interest rate risks with respect to foreign currency denominated borrowings and bonds. The contracts are not designated as hedging instruments.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

7.	Inventories

Inventories as of December 31, 2023 and December 31, 2022 are as follows:


(In millions of won)
	December 31, 2023		December 31, 2022
Finished goods	W	279,483		215,526
Work-in-process		1,005,025		1,049,489
Raw materials		408,078		578,704
Supplies		88,373		80,875

	W	1,780,959		1,924,594

For the years ended December 31, 2023 and 2022, the amount of inventories recognized as cost of sales including inventory write-downs are as follows:


(In millions of won)
	2023		2022
Inventories recognized as cost of sales	W	21,446,905		24,870,325
Including: Inventory write-downs		153,844		189,197

There were no significant reversals of inventory write-downs recognized during the years ended December 31, 2023 and 2022.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

8.	Investments

(a)

Investments in subsidiaries consist of the following:


(In millions of won)
			December 31, 2023					December 31, 2022
Subsidiaries	Location	Business	Percentage of ownership			Carrying Amount		Percentage of ownership			Carrying Amount
LG Display America, Inc.	San Jose, U.S.A.	Sell display products		100	%	W	36,815		100	%	W	36,815
LG Display Germany GmbH	Eschborn, Germany	Sell display products		100	%		19,373		100	%		19,373
LG Display Japan Co., Ltd.	Tokyo, Japan	Sell display products		100	%		15,686		100	%		15,686
LG Display Taiwan Co., Ltd.	Taipei, Taiwan	Sell display products		100	%		35,230		100	%		35,230
LG Display Nanjing Co., Ltd.	Nanjing, China	Manufacture display products		100	%		593,726		100	%		593,726
LG Display Shanghai Co., Ltd.	Shanghai, China	Sell display products		100	%		9,093		100	%		9,093
LG Display Guangzhou Co., Ltd.	Guangzhou, China	Manufacture display products		100	%		293,557		100	%		293,557
LG Display Shenzhen Co., Ltd.	Shenzhen, China	Sell display products		100	%		3,467		100	%		3,467
LG Display Singapore Pte. Ltd.	Singapore	Sell display products		100	%		1,250		100	%		1,250
L&T Display Technology (Fujian) Limited	Fujian, China	Manufacture and sell LCD module and LCD monitor sets		51	%		10,123		51	%		10,123
LG Display Yantai Co., Ltd.	Yantai, China	Manufacture display products		100	%		169,195		100	%		169,195
Nanumnuri Co., Ltd.	Gumi, South Korea	Provide janitorial services		100	%		800		100	%		800
LG Display (China) Co., Ltd.	Guangzhou, China	Manufacture and sell display products		51	%		723,086		51	%		723,086
Unified Innovative Technology, LLC	Wilmington, U.S.A.	Manage intellectual property		100	%		9,489		100	%		9,489
LG Display Guangzhou Trading Co., Ltd.	Guangzhou, China	Sell display products		100	%		218		100	%		218
Global OLED Technology LLC	Sterling, U.S.A	Manage OLED intellectual property		100	%		164,322		100	%		164,322
LG Display Vietnam Haiphong Co., Ltd.	Haiphong, Vietnam	Manufacture and sell display products		100	%		672,658		100	%		672,658
Suzhou Lehui Display Co., Ltd.	Suzhou, China	Manufacture and sell LCD module and LCD monitor sets		100	%		121,640		100	%		121,640
LG DISPLAY FUND I LLC(*1)	Wilmington, U.S.A	Invest in venture business and acquire technologies		100	%		91,105		100	%		85,266
LG Display High-Tech (China) Co., Ltd.	Guangzhou, China	Manufacture and sell display products		69	%		1,794,547		69	%		1,794,547
MMT(Money Market Trust) (*2)	Seoul, South Korea	Money market trust		100	%		92,900		—

						W	4,858,280				W	4,759,541

(*1)

During 2023, the Company contributed W5,839 million in cash for the capital increase of LG DISPLAY FUND I LLC. There was no change in the Company’s ownership percentage in LG DISPLAY FUND I LLC as a result of this additional investment.

(*2)

The balance of MMT(Money Market Trust) as of December 31, 2023 is W92,900 million.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

8.	Investments, Continued

(b)	Investments in associates consist of the following:


(In millions of won)
			December 31, 2023				December 31, 2022
Associates	Location	Business	Percentage of ownership			Carrying Amount	Percentage of ownership			Carrying Amount
Paju Electric Glass Co., Ltd.	Paju, South Korea	Manufacture glass for display		40	%	W45,089		40	%	W45,089
WooRee E&L Co., Ltd(*1).	Ansan, South Korea	Manufacture LED back light unit packages		13	%	7,106		13	%	11,424
YAS Co., Ltd.	Paju, South Korea	Develop and manufacture deposition equipment for OLEDs		16	%	10,000		15	%	10,000
AVATEC Co., Ltd.	Daegu, South Korea	Process and sell glass for display		14	%	8,000		14	%	8,000
Arctic Sentinel, Inc.	Los Angeles, U.S.A.	Develop and manufacture tablet for kids		10	%	—		10	%	—
Cynora GmbH	Bruchsal Germany	Develop organic emitting materials for displays and lighting devices		10	%	—		11	%	—
Material Science Co., Ltd.(2) (3)	Seoul, South Korea	Develop, manufacture and sell materials for display		16	%	3,588		10	%	3,650

						W73,783				W78,163

(*1)

During 2023, the Company recognized an impairment loss of W4,318 million as finance cost for the difference between the carrying amount and the recoverable amount of investments in WooRee E&L Co., Ltd.

(*2)

During 2023, the Company recognized an impairment loss of W62 million as finance cost for the difference between the carrying amount and the recoverable amount of investments in Material Science Co., Ltd.

(*3)

During 2023, due to the investee’s acquisition of treasury shares, the Company’s shareholding ratio increased from 10% to 16%.

Although the Company’s respective share interests in WooRee E&L Co., Ltd., YAS Co., Ltd., AVATEC Co., Ltd., Arctic Sentinel, Inc., Cynora GmbH and Material Science Co., Ltd. are below 20%, the Company is able to exercise significant influence through its right to appoint a director to the board of directors of each investee. Accordingly, the investments in these investees have been accounted for using the equity method.

Dividends income recognized from subsidiaries and associates for the years ended December 31, 2023 and 2022 amounted to W1,895,692 million and W122,303 million, respectively.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

9.	Property, Plant and Equipment

(a)

Changes in property, plant and equipment for the year ended December 31, 2023 are as follows:


(In millions of won)
	Land			Buildings and structures			Machinery and equipment			Furniture and fixtures			Construction *-in-progress (1)**			Right-of-use asset			Others *(2)**			Total
Acquisition cost as of January 1, 2023	W	476,045			5,265,179			36,539,468			554,850			9,393,158			40,702			926,870			53,196,272
Accumulated depreciation as of January 1, 2023		—			(3,210,075	)		(33,383,114	)		(445,727	)		—			(34,895	)		(669,004	)		(37,742,815	)
Accumulated impairment loss as of January 1, 2023		—			(180,864	)		(871,500	)		(5,919	)		(328,555	)		(347	)		(21,428	)		(1,408,613	)

Book value as of January 1, 2023	W	476,045			1,874,240			2,284,854			103,204			9,064,603			5,460			236,438			14,044,844

Additions		—			—			—			—			1,894,782			21,568			—			1,916,350
Depreciation		—			(225,364	)		(1,300,227	)		(44,680	)		—			(13,030	)		(219,406	)		(1,802,707	)
Disposals		(330	)		(758	)		(507,869	)		(1,921	)		—			—			(43,635	)		(554,513	)
Impairment loss(*3)		—			—			(2,022	)		(6	)		—			—			(6,493	)		(8,521	)
Others(*4)		(2,902	)		1,416,828			3,290,481			28,186			(5,067,588	)		—			323,789			(11,206	)

Book value as of December 31, 2023	W	472,813			3,064,946			3,765,217			84,783			5,891,797			13,998			290,693			13,584,247

Acquisition cost as of December 31, 2023	W	472,813			6,674,304			37,381,457			563,966			6,148,883			38,260			1,063,452			52,343,135

Accumulated depreciation as of December 31, 2023	W	—			(3,429,293	)		(32,682,474	)		(473,444	)		—			(24,040	)		(749,958	)		(37,359,209	)

Accumulated impairment loss as of December 31, 2023	W	—			(180,065	)		(933,766	)		(5,739	)		(257,086	)		(222	)		(22,801	)		(1,399,679	)

(*1)	As of December 31, 2023, construction-in-progress mainly relates to construction of manufacturing facilities.

(*2)	Others mainly consist of tools and equipment.

(*3)	Impairment losses of W8,521 million are recognized for the difference between the carrying amount and the recoverable amount of property, plant and equipment.

(*4)	Others mainly represent the reclassification of construction-in-progress to other property, plant and equipment.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

9.	Property, Plant and Equipment, Continued

(b)

Changes in property, plant and equipment for the year ended December 31, 2022 are as follows:


	Land			Buildings and structures			Machinery and equipment			Furniture and fixtures			Construction- *in-progress (1)**			Right-of-use asset			Others *(2)**			Total
Acquisition cost as of January 1, 2022	W	433,847			5,150,686			36,476,141			546,221			6,632,832			32,999			842,082			50,114,808

Accumulated depreciation as of January 1, 2022		—			(3,073,483	)		(32,813,259	)		(435,666	)		—			(27,542	)		(599,171	)		(36,949,121	)
Accumulated impairment loss as of January 1, 2022		—			(138,679	)		(914,857	)		(4,971	)		(76,069	)		(167	)		(20,086	)		(1,154,829	)
Book value as of January 1, 2022	W	433,847			1,938,524			2,748,025			105,584			6,556,763			5,290			222,825			12,010,858

Additions		—			—			—			—			4,463,548			14,183			—			4,477,731
Depreciation		—			(208,409	)		(1,397,691	)		(43,137	)		—			(13,339	)		(197,717	)		(1,860,293	)
Disposals		(3,573	)		—			(167,724	)		(381	)		—			—			(35,591	)		(207,269	)
Impairment loss(*3)		—			(42,185	)		(33,230	)		(2,763	)		(252,486	)		(254	)		(8,456	)		(339,374	)
Others(*4)		45,771			186,310			1,135,474			43,901			(1,703,222	)		(420	)		255,377			(36,809	)
Book value as of December 31, 2022	W	476,045			1,874,240			2,284,854			103,204			9,064,603			5,460			236,438			14,044,844

Acquisition cost as of December 31, 2022	W	476,045			5,265,179			36,539,468			554,850			9,393,158			40,702			926,870			53,196,272

Accumulated depreciation as of December 31, 2022	W	—			(3,210,075	)		(33,383,114	)		(445,727	)		—			(34,895	)		(669,004	)		(37,742,815	)

Accumulated impairment loss as of December 31, 2022	W	—			(180,864	)		(871,500	)		(5,919	)		(328,555	)		(347	)		(21,428	)		(1,408,613	)

(*1)	As of December 31, 2022, construction-in-progress mainly relates to construction of manufacturing facilities.

(*2)	Others mainly consist of tools and equipment.

(*3)	During 2022, Display (Large OLED) CGU were assessed for impairment, and impairment losses amounting to W333,547 million are recognized as other non-operating expenses.

(*4)	Others mainly represent the reclassification of construction-in-progress to other property, plant and equipment.

(c)	Capitalized borrowing costs and capitalization rate for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023		2022
Capitalized borrowing costs	W	208,733		142,980
Capitalization rate		4.96%		3.12%

(d)	The company provides a portion of property, plant and equipment as an operating lease. During 2023, rental income from property, plant and equipment is W1,886 million (2022: W2,066 million).

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

10.	Intangible Assets and Non-financial Assets Impairment

(a)

Changes in intangible assets for the year ended December 31, 2023 are as follows:


(In millions of won)	Intellectual property rights			Software			Member- ships			Develop- ment costs			Construction- in-progress			Customer relationships			Technology			Good will			Others *(2)**			Total
Acquisition cost as of January 1, 2023	W	1,757,282			1,160,702			26,619			2,016,477			28,169			59,176			12,763			72,588			13,080			5,146,856
Accumulated amortization as of January 1, 2023		(878,767	)		(975,411	)		—			(1,358,446	)		—			(37,491	)		(11,411	)		—			(13,080	)		(3,274,606	)
Accumulated impairment loss as of January 1, 2023		(48,598	)		(14,235	)		(1,701	)		(92,812	)		—			(21,685	)		(43	)		(57,995	)		—			(237,069	)

Book value as of January 1, 2023	W	829,917			171,056			24,918			565,219			28,169			—			1,309			14,593			—			1,635,181
Additions - internally developed		—			—			—			493,608			—			—			—			—			—			493,608
Additions - external purchases		118,343			—			—			—			98,585			—			—			—			—			216,928
Amortization (*1)		(156,128	)		(85,528	)		—			(363,162	)		—			—			(163	)		—			—			(604,981	)
Disposals		(202	)		(396	)		(3,796	)		—			—			—			—			—			—			(4,394	)
Impairment loss (*3)		(1,633	)		(425	)		—			(52,775	)		—			—			—			—			—			(54,833	)
Reversal of impairment loss		—			—			242			—			—			—			—			—			—			242
Transfer from construction-in-progress		—			96,801			—			(1,429	)		(94,094	)		—			—			—			—			1,278

Book value as of December 31, 2023	W	790,297			181,508			21,364			641,461			32,660			—			1,146			14,593			—			1,683,029

Acquisition cost as of December 31, 2023	W	1,867,526			1,202,537			22,905			2,295,468			32,660			59,176			12,763			72,588			13,080			5,578,703

Accumulated amortization as of December 31, 2023	W	(1,029,320)			(1,008,433	)		—			(1,509,575	)		—			(37,491	)		(11,574	)		—			(13,080)			(3,609,473	)

Accumulated impairment loss as of December 31, 2023	W	(47,909)			(12,596	)		(1,541	)		(144,432	)		—			(21,685	)		(43	)		(57,995	)		—			(286,201	)

(*1)	The Company has classified the amortization as manufacturing overhead costs, selling expenses, administrative expenses, and research and development expenses.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

10.	Intangible Assets and Non-financial Assets Impairment, Continued

(*2)	Others mainly consist of rights to use electricity and gas supply facilities.

(*3)	The Company recognized an impairment loss amounting to W52,775 million for development projects which are not likely to generate revenue.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

10.	Intangible Assets and Non-financial Assets Impairment, Continued

(b)

Changes in intangible assets for the year ended December 31, 2022 are as follows:


(In millions of won)	Intellectual property rights			Software			Member- ships			Development costs			Construction- in-progress			Customer relationships			Technology			Good will			Others *(2)**			Total
Acquisition cost as of January 1, 2022	W	1,573,815			1,093,251			30,267			1,771,383			18,309			59,176			12,763			72,588			13,080			4,644,632
Accumulated amortization as of January 1, 2022		(718,807	)		(910,855	)		—			(1,318,476	)		—			(37,491	)		(11,243	)		—			(13,080	)		(3,009,952	)
Accumulated impairment loss as of January 1, 2022		(21,484	)		(8,353	)		(1,659	)		(63,692	)		—			(21,685	)		—			(57,995	)		—			(174,868	)

Book value as of January 1, 2022	W	833,524			174,043			28,608			389,215			18,309			—			1,520			14,593			—			1,459,812
Additions - internally developed		—			—			—			502,755			—			—			—			—			—			502,755
Additions - external purchases		187,087			9,304			6,960			—			86,363			—			—			—			—			289,714
Amortization (*1)		(161,141	)		(81,766	)		—			(272,102	)		—			—			(168	)		—			—			(515,177	)
Disposals		—			(977	)		(10,608	)		—			—			—			—			—			—			(11,585	)
Impairment loss (3)(4)		(29,553	)		(6,051	)		(42	)		(54,649	)		—			—			(43	)		—			—			(90,338	)
Transfer from construction-in-progress		—			76,503			—			—			(76,503	)		—			—			—			—			—

Book value as of December 31, 2022	W	829,917			171,056			24,918			565,219			28,169			—			1,309			14,593			—			1,635,181

Acquisition cost as of December 31, 2022	W	1,757,282			1,160,702			26,619			2,016,477			28,169			59,176			12,763			72,588			13,080			5,146,856

Accumulated amortization as of December 31, 2022	W	(878,767)			(975,411	)		—			(1,358,446	)		—			(37,491	)		(11,411	)		—			(13,080	)		(3,274,606	)

Accumulated impairment loss as of December 31, 2022	W	(48,598)			(14,235)			(1,701	)		(92,812	)		—			(21,685	)		(43	)		(57,995	)		—			(237,069	)

(*1)	The Company has classified the amortization as manufacturing overhead costs, selling expenses, administrative expenses, and research and development expenses.

(*2)	Others mainly consist of rights to use electricity and gas supply facilities.

(*3)	During 2022, Display (Large OLED) CGU were assessed for impairment, and impairment losses amounting to W55,713 million are recognized as other non-operating expenses. The impairment amount is allocated to development costs, intellectual property rights and others.

(*4)	The Company recognized an impairment loss amounting to W33,386 million for development projects which are not likely to generate revenue.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

10.	Intangible Assets and Non-financial Assets Impairment, Continued

(c)

Development costs and Intellectual property rights as of December 31, 2023 and 2022 are as follows:

Development costs

(i)

As of December 31, 2023

(In millions of won)

Classification

Product type

Book Value

Development completed

43,956

63,049

Mobile and others

190,487

297,492

Development in process

46,368

175,023

Mobile and others

122,578

343,969

641,461

(ii) As of December 31, 2022

(In millions of won)

Classification

Product type

Book Value

Development completed

55,187

24,684

Mobile and others

199,552

279,423

Development in process

60,376

100,380

Mobile and others

125,040

285,796

565,219

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

10.	Intangible Assets and Non-financial Assets Impairment, Continued

Intellectual property rights

(i)

As of December 31, 2023


(In millions of won and in years)
Classification	Category		Book Value		Remaining amortization period (*1)
Patent		Direct additions	W	214,143		7.1
		Licenses agreement(*2)		573,810		5.7

			W	787,953

Other				2,344		3.6

			W	790,297

(*1)

Weighted average of the remaining useful life at the end of the reporting period as each patent has a different remaining amortization period.

(*2)

The Company’s rights under contracts with the patent company.

(ii)

As of December 31, 2022


(In millions of won and in years)
Classification	Category		Book Value		Remaining amortization period (*1)
Patent		Direct additions	W	196,701		7.2
		Licenses agreement(*2)		631,301		6.4

			W	828,002

Other				1,915		3.6

			W	829,917

(*1)

Weighted average of the remaining useful life at the end of the reporting period as each patent has a different remaining amortization period.

(*2)

The Company’s rights under contracts with the patent company.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

10.	Intangible Assets and Non-financial Assets Impairment, Continued

(d)

Impairment assessment on CGU

As of December 31, 2023, the Company’s cash-generating units consist of Display CGU, Display (Large OLED) CGU and Display (AD PO) CGU. As of December 31, 2023, the Company performed impairment assessment to Display CGU. All the goodwill balance as of December 31, 2023 is allocated for the Display CGU

The recoverable amount of Display CGU is determined based on its value in use. Value in use is calculated using the estimated cash flow based on 5-year business plan approved by management. The estimated revenue and operating expenditures of the Company’s products used in the forecast was determined considering external sources and the Company’s historical experience. Management estimated the future cash flows based on its past performance and forecasts on market growth. The key assumptions used in the estimation of value in use for Display CGU include revenue and operating expenditures for the forecast period, and discount rate. Growth rate for subsequent years (“terminal growth rate) and the discount rate used in the estimation of value in use are as follows.


	Pre-tax *discount rate()**			Post-tax *discount rate()**			Terminal growth rate
2023
Display CGU		10.9	%		9.0	%		1.0	%

2022
Display CGU		10.8	%		9.0	%		1.0	%

(*)

The discount rate was calculated using the weighted average cost of equity capital and debt and the beta of equity capital was calculated as the average of five global listed companies in the same industry and the Company. Cost of debt was calculated using the yield rate of non-guaranteed corporate bond considering the Company’s credit rating and debt ratio was determined using the average of the debt ratios of the five global listed companies in the same industry and the Company. The Company calculates the value in use of the CGU using post-tax cash flows and a post-tax discount rate, and the result is not significantly different from the value in use calculated using pre-tax cash flows and pre-tax discount rate.

As a result of impairment assessment for Display CGU, the recoverable amount exceeded its carrying amount. The value in use determined for this CGU is sensitive to the discount rate used in the discounted cash flow model.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

11.	Investment Property

(a)

Changes in investment property for the year ended December 31, 2023 and 2022 are as follows:


(In millions of won)	2023			2022
Book value as of January 1	W	28,269			—
Transfer from property, plant and equipment		9,928			36,809
Depreciation		(4,962	)		(804	)
Impairment loss		—			(7,736	)
Others		(240	)		—

Book value as of December 31	W	32,995			28,269

(b)

During 2023, rental income from investment property is W5,478 million (2022: W2,066 million).

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

12.	Financial Liabilities

(a)

Financial liabilities as of December 31, 2023 and 2022 are as follows:


(In millions of won)	December 31, 2023		December 31, 2022
Current
Short-term borrowings	W	1,428,213		1,952,289
Current portion of long-term borrowings		2,000,930		1,721,690
Current portion of bonds		369,716		316,648
Current portion of payment guarantee liabilities		6,780		5,877
Derivatives(*1)		26,193		14,443
Fair value hedging derivatives(*2)		7,392		—
Lease liabilities		11,598		3,099

	W	3,850,822		4,014,046

Non-current
Long-term borrowings	W	4,784,819		3,938,415
Bonds		1,118,427		1,132,098
Payment guarantee liabilities		13,833		13,364
Derivatives(*1)		37,333		32,965
Fair value hedging derivatives (*2)		28,660		—
Lease liabilities		2,802		2,853

	W	5,985,874		5,119,695

(*1)

(*2)

Represents forward exchange contracts entered into by the Company to hedge exchange rate risks with respect to advances received in foreign currency. The contracts are designated as hedging instruments.

(b)

Short-term borrowings as of December 31, 2023 and 2022 are as follows.

(In millions of won, USD and CNY)

Lender

Annual interest rate
as of
December 31, 2023 (%)

December 31,
2023

December 31,
2022

The Standard Chartered Bank of Korea Limited and others

3.50~6.95

1,428,213

1,952,289

Foreign currency equivalent

USD 400

USD 901

CNY 345

—

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

12.	Financial Liabilities, Continued

(c)

Won denominated long-term borrowings as of December 31, 2023 and 2022 are as follows :


(In millions of won)
Lender	Annual interest rate as of December 31, 2023 (%)		December 31, 2023			December 31, 2022
LG Electronics Inc.		6.06	W	1,000,000			—
Korea Development Bank and others		1.90~7.50		3,490,967			2,986,102
Less current portion of long-term borrowings				(776,000	)		(1,341,500	)

			W	3,714,967			1,644,602

(d)

Foreign currency denominated long-term borrowings as of December 31, 2023 and 2022 are as follows :


(In millions of won and USD)
Lender	Annual interest rate as of December 31, 2023 (%)		December 31, 2023			December 31, 2022
KEB Hana Bank and others		1.82~8.60	W	2,294,782			2,674,003

Foreign currency equivalent			USD	1,780		USD	2,110
Less current portion of long-term borrowings				(1,224,930	)		(380,190	)

			W	1,069,852			2,293,813

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

12.	Financial Liabilities, Continued

(e)

Details of bonds issued and outstanding as of December 31, 2023 and 2022 are as follows :


(In millions of won and USD)
	Maturity		Annual interest rate as of December 31, 2023 (%)		December 31, 2023			December 31, 2022
*Won denominated bonds at amortized cost(1)**
Publicly issued bonds		February 2024~ February 2027		2.29~3.66	W	1,025,000			1,215,000
Privately issued bonds		January 2025~ January 2026		7.20~7.25		337,000			110,000
Less discount on bonds						(2,120	)		(2,927	)
Less current portion						(369,716	)		(189,975	)

					W	990,164			1,132,098

*Foreign currency denominated bonds at amortized cost(2)**
Privately issued bonds		April 2026		7.29	W	128,940			126,730
Foreign currency equivalent (contractual par amount)						USD 100			USD 100
Less discount on bonds						(677	)		(57	)
Foreign currency equivalent (discount on bonds)						USD (1	)		USD (0	)
Less current portion						—			(126,673	)

					W	128,263			—

					W	1,118,427			1,132,098

(*1)

Principal of the won denominated bonds is to be repaid at maturity and interests are paid quarterly.

(*2)

Principal of the foreign currency denominated bonds is to be repaid at maturity and interests are paid quarterly.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

13.	Employee Benefits

The Company’s defined benefit plans provide a lump-sum payment to an employee based on final salary rates and length of service at the time the employee leaves the Company.

The defined benefit plans expose the Company to actuarial risks, such as the risk associated with expected periods of service, interest rate risk, market (investment) risk, and others.

(a)

Net defined benefit liabilities (defined benefit assets) recognized as of December 31, 2023 and 2022 are as follows:


(In millions of won)
	December 31, 2023			December 31, 2022
Present value of partially funded defined benefit obligations	W	1,482,976			1,595,629
Fair value of plan assets		(1,890,188	)		(2,043,150	)

	W	(407,212)			(447,521	)

(b)

Changes in the present value of the defined benefit obligations for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023			2022
Defined benefit obligations at January 1	W	1,595,629			1,678,148
Current service cost		171,479			171,753
Interest cost		83,793			59,104
Remeasurements (before tax)		(65,505	)		(195,908	)
Benefit payments		(285,869	)		(116,105	)
Net transfers from (to) related parties		(16,551	)		(1,363	)

Defined benefit obligations at December 31	W	1,482,976			1,595,629

Weighted average remaining maturity of defined benefit obligations as of December 31, 2023 and 2022 are 12.20 years and 12.95 years, respectively.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

13.	Employee Benefits, Continued

(c)

Changes in fair value of plan assets for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023			2022
Fair value of plan assets at January 1	W	2,043,150			1,746,424
Expected return on plan assets		107,735			64,378
Remeasurements (before tax)		(870	)		(30,044	)
Contributions by employer directly to plan assets		—			370,000
Benefit payments		(259,609	)		(107,608	)
Net transfers from (to) related parties		(218	)		—

Fair value of plan assets at December 31	W	1,890,188			2,043,150

The estimated contributions payable in the following financial year is W180,902 million.

(d)

Plan assets as of December 31, 2023 and 2022 are as follows:


(In millions of won)
	December 31, 2023		December 31, 2022
Guaranteed deposits in banks	W	1,890,188		2,043,150

As of December 31, 2023, the Company maintains the plan assets primarily with Mirae Asset Securities Co., Ltd., KB Insurance Co., Ltd. and others.

(e)

Expenses related to defined benefit plans recognized in profit or loss for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023			2022
Current service cost	W	171,479			171,753
Net interest cost		(23,942	)		(5,274	)

	W	147,537			166,479

Expenses are recognized in the separate statements of comprehensive income (loss) as follows:


(In millions of won)
	2023		2022
Cost of sales	W	114,226		128,706
Selling expenses		6,738		7,585
Administrative expenses		14,865		17,431
Research and development expenses		11,708		12,757

	W	147,537		166,479

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

13.	Employee Benefits, Continued

(f)

Remeasurements of net defined benefit liabilities (assets) included in other comprehensive income (loss) for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023			2022
Balance at January 1	W	(2,806)			(125,167	)
Remeasurements
Actuarial profit or loss arising from:
Experience adjustment		66,461			(83,376	)
Demographic assumptions		(85	)		(8,020	)
Financial assumptions		(871	)		287,304
Return on plan assets		(870	)		(30,044	)

	W	64,635			165,864

Income tax	W	(14,818)			(43,503	)

Balance at December 31	W	47,011			(2,806)

(g)

Principal actuarial assumptions as of December 31, 2023 and 2022 (expressed as weighted averages) are as follows:


	December 31, 2023			December 31, 2022
Expected rate of salary increase		4.0	%		4.7	%
Discount rate for defined benefit obligations		4.6	%		5.4	%

Assumptions regarding future mortality are based on published statistics and mortality tables. The current mortality underlying the values of the liabilities in the defined benefit plans are as follows:


		December 31, 2023			December 31, 2022
Teens	Males		0.00	%		0.00	%
	Females		0.00	%		0.00	%
Twenties	Males		0.01	%		0.01	%
	Females		0.00	%		0.00	%
Thirties	Males		0.01	%		0.01	%
	Females		0.00	%		0.00	%
Forties	Males		0.02	%		0.02	%
	Females		0.01	%		0.01	%
Fifties	Males		0.04	%		0.04	%
	Females		0.02	%		0.02	%

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

13.	Employee Benefits, Continued

(h)

Reasonably possible changes to respective relevant actuarial assumptions would have affected the defined benefit obligations by the following amounts as of December 31, 2023:


(In millions of won)
	Defined benefit obligations
	1% increase		1% decrease
Discount rate for defined benefit obligations	W	(157,102)		184,374
Expected rate of salary increase		192,107		(165,703	)

14.	Provisions

(a)

Changes in provisions for the year ended December 31, 2023 are as follows:


(In millions of won)
	Litigation and claims		*Warranties ()**			Others			Total
Balance at January 1, 2023	W	1,680		248,137			8,432			258,249
Additions (reversal)		126		49,787			(2,552	)		47,361
Usage		—		(125,971	)		—			(125,971	)

Balance at December 31, 2023	W	1,806		171,953			5,880			179,639

Current	W	1,806		108,148			5,880			115,834
Non-current	W	—		63,805			—			63,805

(*)

Product warranties on defective products are normally applicable for warranty periods from the date of customer’s purchase. The provision is calculated by using historical and anticipated rates of warranty claims and costs per claim to satisfy the Company’s warranty obligation.

(b)

Changes in provisions for the year ended December 31, 2022 are as follows:


(In millions of won)
	Litigation and claims		*Warranties ()**			Others			Total
Balance at January 1, 2022	W	—		255,560			9,247			264,807
Additions (reversal)		1,680		205,630			(815	)		206,495
Usage		—		(213,053	)		—			(213,053	)

Balance at December 31, 2022	W	1,680		248,137			8,432			258,249

Current	W	1,680		161,980			8,432			172,092
Non-current	W	—		86,157			—			86,157

(*)

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

15.	Contingent Liabilities and Commitments

(a)

Legal Proceedings

Anti-trust litigations

Some individual claimants filed “follow-on” damages claims against the Company and other TFT-LCD manufacturers alleging violations of EU competition law. While the Company continues its vigorous defense of the various pending proceedings described above, as of December 31, 2023, the Company cannot reliably estimate the timing and amount of outflows of resources embodying economic benefits relating to the proceedings.

Others

The Company is involved in various lawsuits and disputes in addition to the pending proceedings described above. The Company cannot reliably estimate the timing and amount of outflows of resources embodying economic benefits relating to the disputes.

(b)

Commitments

Factoring and securitization of accounts receivable

The Company has agreements with Korea Development Bank and several other banks for accounts receivable sales negotiating facilities of up to an aggregate of USD 1,000 million (W1,289,400 million) in connection with the Company’s export sales transactions with its subsidiaries. As of December 31, 2023, there are no short-term borrowings that are outstanding but past due in connection with these agreements. In connection with all of the contracts in this paragraph, the Company has sold its accounts receivable with recourse.

The Company has a credit facility agreement with Sumitomo Mitsui Banking Corporation and several other banks pursuant to which the Company could sell its accounts receivables up to an aggregate of W328,797 million in connection with its domestic and export sales transactions and, as of December 31, 2023, W12,841 million accounts and notes receivable sold to Sumitomo Mitsui Banking Corporation were outstanding in connection with the agreement. In connection with the contract above, the Company has sold its accounts receivable without recourse.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

15.	Contingent Liabilities and Commitments, Continued

Letters of credit

As of December 31, 2023, the Company entered into agreements with financial institutions in relation to the opening of letters of credit and the respective credit limits under the agreements are as follows:


(In millions of won and USD)
	Contractual amount		KRW equivalent
KEB Hana Bank		USD 450	W	580,230
Industrial Bank of Korea		USD 450		580,230
Industrial and Commercial Bank of China		USD 200		257,880
Shinhan Bank		USD 70		90,258
KB Kookmin Bank		USD 700		902,580
MUFG Bank		USD 100		128,940
The Export–Import Bank of Korea		USD 100		128,940

		USD 2,070	W	2,669,058

Payment guarantees

The Company is providing payment guarantees to LG Display Vietnam Haiphong Co., Ltd. in connection with the principal amount of term loan credit facilities amounting to USD 1,462 million (W1,884,673 million).

The Company was provided with payment guarantees amounting to USD 1,200 million (W1,547,280 million) from KB Kookmin Bank and others for advances received related to the long-term supply agreements.

License agreements

As of December 31, 2023, the Company has technical license agreements with Hitachi Display, Ltd. and others in relation to its LCD business and patent license agreement with Universal Display Corporation and others in relation to its OLED business. Also, the Company has a trademark license agreement with LG Corp. and other intellectual property license agreements with various companies as of December 31, 2023.

Long-term supply agreement

As of December 31, 2023, in connection with long-term supply agreements with customers, the Company recognized USD 1,200 million (W1,547,280 million) in advances received. The advances received will be used to offset accounts receivable arising from future product sales after a specified period of time. The Company was provided with payment guarantees amounting to USD 1,200 million (W1,547,280 million) from KB Kookmin Bank and other various banks relating to advances received (see note 15(b)).

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

15.	Contingent Liabilities and Commitments, Continued

Pledged assets

The pledged assets has provided by the company are as follows:


(In millions of won)
Pledged Assets	Carrying amount		Maximum bond amount		Secured creditor	Borrowing amount
Property plant and equipment and others(*)	W	507,234		1,200,000	LG Electronics Inc.		1,000,000
		89,703		326,400	Korea Development Bank and others		272,000
		264,335		780,000	Korea Development Bank and others		200,000

(*)

The property, plant and equipment amounting to W89,703 million are provided as collateral for borrowings of W272,000 million and W200,000 million to Korea Development Bank and others

The pledged assets provided is as follows:

(In millions of won)

Pledged Assets

Carrying
amount

Maximum
bond amount

Secured creditor

Borrowing
amount

Deposits in banks and others(*)

CNY 4,337

784,290

Shinhan Bank and others

USD 200

450,000

(*)

The Company receives Deposits in banks and others as pledged from LG Display Nanjing Co., Ltd.

Commitments for asset acquisition

The Company’s commitments in relation to capital expenditures on property, plant and equipment and intangible assets as of December 31, 2023 are W497,336 million. This commitment has not been recognized in these separate financial statements.

16.	Share Capital and Share Premium

The Company is authorized to issue 500,000,000 shares of capital stock (par value W5,000), and as of December 31, 2023 and December 31, 2022 the number of issued common shares is 357,815,700. There have been no changes in the capital stock from January 1, 2022 to December 31, 2023

The Company’s capital surplus consists of share premium. There have been no changes in share premium from January 1, 2022 to December 31, 2023

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

17.	Retained earnings and Reserves

(a)

Retained earnings as of December 31, 2023 and 2022 are as follows:


(In millions of won)
	December 31, 2023		December 31, 2022
Legal reserve	W	235,416		235,416
Other reserve		68,251		68,251
Defined benefit plan actuarial income (loss)		47,011		(2,806	)
Unappropriated retained earnings		1,290,685		3,009,386

	W	1,641,363		3,310,247

(b)

For the years ended December 31, 2023 and 2022, details of the Company’s appropriations of retained earnings are as follows:


(In millions of won, except for cash dividend per common stock)
	2023			2022
Retained earnings before appropriations
Unappropriated retained earnings carried over from prior year	W	3,009,386			6,200,773
Loss for the year		(1,718,701	)		(3,191,387	)

		1,290,685			3,009,386
Unappropriated retained earnings carried forward to the following year	W	1,290,685			3,009,386

Expected date of appropriation for the year ended December 31, 2023 is March 22, 2024 and the date of appropriation for the year ended December 31, 2022 was March 21, 2023.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

18.

Revenue

Details of revenue for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023		2022
Sales of goods	W	19,761,198		24,312,253
Royalties		13,337		9,600
Others		36,480		22,275
Hedging loss		—		(212,956	)

	W	19,811,015		24,131,172

19.	The Nature of Expenses and Others

The classification of expenses by nature for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023		2022
Changes in inventories	W	143,635		206,403
Purchases of raw materials, merchandise and others		6,744,123		8,281,617
Depreciation and amortization		2,328,219		2,376,274
Outsourcing		8,985,108		10,480,070
Labor		2,508,950		2,566,328
Supplies and others		689,363		857,748
Utility		885,278		806,753
Fees and commissions		399,085		491,394
Shipping		39,300		55,892
Advertising		76,353		107,934
Warranty		49,787		205,630
Travel		57,654		59,774
Taxes and dues		66,698		71,901
Others		894,958		1,288,356

	W	23,868,511		27,856,074

Total expenses consist of cost of sales, selling, administrative, research and development expenses and other non-operating expenses, excluding foreign exchange differences.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

20.	Selling and Administrative Expenses

Details of selling and administrative expenses for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023		2022
Salaries	W	247,797		234,224
Expenses related to defined benefit plans		22,834		25,146
Other employee benefits		51,689		54,896
Shipping		20,569		27,221
Fees and commissions		160,979		197,198
Depreciation		152,460		122,480
Taxes and dues		5,973		3,981
Advertising		76,353		107,934
Warranty		49,787		205,630
Insurance		9,451		8,863
Travel		12,910		13,873
Training		8,416		11,670
Others		61,631		86,998

	W	880,849		1,100,114

21.	Personnel Expenses

Details of personnel expenses for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023		2022
Salaries and wages	W	2,181,558		2,187,407
Other employee benefits		354,519		340,295
Contributions to National Pension plan		80,905		76,378
Expenses related to defined benefit plans and defined contribution plans		156,740		167,638

	W	2,773,722		2,771,718

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

22.	Other Non-operating Income and Other Non-operating Expenses

(a)

Details of other non-operating income for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023		2022
Foreign currency gain	W	941,200		2,185,566
Gain on disposal of property, plant and equipment		33,842		27,361
Gain on disposal of intangible assets		1,989		—
Reversal of impairment loss on intangible assets		242		1,975
Rental income		1,886		2,066
Others		16,632		49,852

	W	995,791		2,266,820

(b)

Details of other non-operating expenses for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023		2022
Foreign currency loss	W	1,104,656		2,075,449
Loss on disposal of property, plant and equipment		102,297		53,904
Impairment loss on property, plant and equipment		8,521		339,374
Loss on disposal of intangible assets		55		193
Impairment loss on intangible assets		54,833		92,313
Impairment loss on investments		—		7,736
Others		7,669		29,919

	W	1,278,031		2,598,888

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

23.	Finance Income and Finance Costs

Finance income and costs recognized in profit or loss for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023		2022
Finance income
Interest income	W	14,922		11,825
Dividend income		1,895,692		122,303
Foreign currency gain		73,362		87,321
Gain on transaction of derivatives		178,610		49,503
Gain on valuation of derivatives		239,973		193,571
Gain on valuation of financial assets at fair value through profit or loss		1,626		1,284
Gain on valuation of financial liabilities at fair value through profit or loss		—		220,240
Others	W	7,412		5,454

		2,411,597		691,501


Finance costs
Interest expense	W	434,455		188,755
Foreign currency loss		103,343		309,142
Loss on repayment of borrowings and bonds		167		2,672
Loss on disposal of investments		—		112
Impairment loss on investments		4,380		29
Loss on sale of trade accounts and notes receivable		899		645
Loss on valuation of financial assets at fair value through profit or loss		8,102		4,442
Loss on transaction of derivatives		—		359
Loss on valuation of derivatives		316,467		65,585
Others		9,537		746

	W	877,350		572,487

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

24.	Income Tax Expense (Benefit)

(a)

Details of income tax expense (benefit) for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023			2022
Current tax expense (benefit)
Current year	W	101,387			8,416
Adjustment for prior years		(26,041	)		(9,622	)

	W	75,346			(1,206	)
Deferred tax expense (benefit)
Origination and reversal of temporary differences and others	W	(1,145,542)			(679,687	)
Change in unrecognized deferred tax assets(*)		156,783			457,763

	W	(988,759)			(221,924	)

Income tax benefit	W	(913,413	)		(223,130	)

(*)

Due to the impact of the changes in estimates of future taxable income, change in unrecognized deferred tax assets consist of effect from reducing deferred tax assets in relation to tax credit carry forwards.

(b)

Income taxes recognized directly in other comprehensive income or loss for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)	2023							2022
	Before tax		Tax expense			Net of tax		Before tax		Tax expense			Net of tax
Remeasurements of net defined benefit liabilities (assets)	W	64,635		(14,818	)		49,817		165,864		(43,503	)		122,361
Gain (loss) on valuation of derivatives		—		—			—		12,495		(3,268	)		9,227

	W	64,635		(14,818	)		49,817		178,359		(46,771	)		131,588

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

24.	Income Tax Expense (Benefit), Continued

(c)

Reconciliation of the effective tax rate for the years ended December 31, 2023 and 2022 is as follows:


(In millions of won)	2023					2022
Loss for the year	W			(1,718,701	)				(3,191,387	)
Income tax benefit				(913,413	)				(223,130	)

Loss before income tax				(2,632,114	)				(3,414,517	)


Income tax benefit using the Company’s statutory tax rate		22.92	%	(603,281	)		23.03	%	(786,363	)
Non-deductible expenses		15.55	%	(409,409	)		(0.07	%)	2,548
Tax credits		7.56	%	(198,966	)		3.83	%	(130,811	)
Change in unrecognized deferred tax assets(*1)		(5.96	%)	156,783			(13.41	%)	457,763
Adjustment for prior years(*2)		(1.19	%)	31,218			(1.40	%)	47,790
Effect on change in tax rate		(0.40	%)	10,504			(5.69	%)	194,375
Others		(3.79	%)	99,738			0.25	%	(8,432	)

Income tax benefit	W			(913,413	)				(223,130	)

Effective tax rate				(*3	)				(*3	)

(*1)

(*2)

Adjustment for prior years in 2023 and 2022 consist of expected amount adjusted for transfer price investigation for prior periods and others.

(*3)

Actual effective tax rate is not calculated due to income tax benefit.

(d)

Global Minimum Tax

The Organization for Economic Cooperation and Development implemented the Base Erosion and Profit Shifting (BEPS) 2.0 framework, which imposes a minimum tax for multinational enterprise groups with total consolidated group revenue of EUR 750 million or more in at least two of the four preceding years. Under the model rules, the above mentioned entities would be required to pay a top-up tax on excess profits in any jurisdiction in which the global anti-base erosion effective tax rate for the jurisdiction is below a 15% minimum rate. The top-up tax is paid to the tax authority of the country where the controlling company that meets certain requirements is located.

However, since the newly enacted tax legislation in Korea is effective from January 1, 2024, there is no current tax impact for the year ended December 31, 2023.

As of December 31, 2023, the Group’s consolidated revenues exceeds EUR 750 million for each of the last two consecutive financial years. For 2024, management does not expect any of the countries where the subsidiaries are located will have a statutory tax rate of below 15%.

LG Display Vietnam Haiphong Co., Ltd., a subsidiary located in Vietnam, receives government support through additional tax deductions that reduce its effective tax rate to below 15%, but it is not expected to be subject to the global minimum tax if the government support is a Qualified Refundable Tax Credit (QRTC).

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

25.	Deferred Tax Assets and Liabilities

(a)

Unrecognized deferred tax liabilities

As of December 31, 2023, in relation to the taxable temporary differences on investments in subsidiaries amounting to W278,598 million, the Company did not recognize deferred tax liabilities since the Company is able to control the timing of the reversal of the temporary difference and it is probable that the temporary differences will not reverse in the foreseeable future.

(b)

Unused tax credit carryforwards for which no deferred tax asset is recognized

As of December 31, 2023, the amount of unused tax credit carryforwards for which no deferred tax asset is recognized and their expiration dates are as follows:


(In millions of won)
	Total		December 31, 2025		December 31, 2026		December 31, 2027		December 31, 2028		December 31, 2029		December 31, 2030		December 31, 2031		December 31, 2032		December 31, 2033
Tax credit carryforwards	W	869,364		7,302		18,476		114,435		90,124		99,937		60,401		79,543		159,552		239,594

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

25.	Deferred Tax Assets and Liabilities, Continued

(c)

Deferred tax assets and liabilities

Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized. The book value of the Company’s deferred income tax assets and liabilities may differ from the amounts actually recovered or settled.

Deferred tax assets and liabilities are attributable to the following:


(In millions of won)	Assets				Liabilities						Total
	December 31, 2023		December 31, 2022		December 31, 2023			December 31, 2022			December 31, 2023			December 31, 2022
Other accounts receivable, net	W	—		—		(61	)		(2,009	)		(61	)		(2,009	)
Inventories, net		28,607		35,562		—			—			28,607			35,562
Defined benefit liabilities, net		—		—		(89,753	)		(95,850	)		(89,753	)		(95,850	)
Accrued expenses		93,511		106,398		—			—			93,511			106,398
Property, plant and equipment		389,828		420,455		—			—			389,828			420,455
Intangible assets		10,504		22,093		—			—			10,504			22,093
Provisions		39,586		57,210		—			—			39,586			57,210
Other temporary differences		112,010		23,881		(22,283	)		(26,008	)		89,727			(2,127	)
Tax loss carryforwards		2,677,340		1,700,860		—			—			2,677,340			1,700,860
Tax credit carryforwards		148,215		170,971		—			—			148,215			170,971

Deferred tax assets (liabilities)	W	3,499,601		2,537,430		(112,097	)		(123,867	)		3,387,504			2,413,563

Realization of deferred tax assets related to unused tax losses and tax credit carryforwards is affected by estimates in future taxable profits before they expire. The estimation uncertainty is primarily driven by the Company’s assumptions in revenue and operating expenditures.

(d)

Changes in deferred tax assets and liabilities for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)	January 1, 2022			Profit or loss			Other comprehensive loss			December 31, 2022			Profit or loss			Other comprehensive loss			December 31, 2023
Other accounts receivable, net	W	(16	)		(1,993	)		—			(2,009	)		1,948			—			(61	)
Inventories, net		34,248			1,314			—			35,562			(6,955	)		—			28,607
Defined benefit liabilities, net		(26,642	)		(25,705	)		(43,503	)		(95,850	)		20,915			(14,818	)		(89,753	)
Accrued expenses		241,238			(134,840	)		—			106,398			(12,887	)		—			93,511
Property, plant and equipment		462,577			(42,122	)		—			420,455			(30,627	)		—			389,828
Intangible assets		15,886			6,207			—			22,093			(11,589	)		—			10,504
Provisions		68,893			(11,683	)		—			57,210			(17,624	)		—			39,586
Other temporary differences		66,254			(65,113	)		(3,268	)		(2,127	)		91,854			—			89,727
Tax loss carryforwards		886,467			814,393			—			1,700,860			976,480			—			2,677,340
Tax credit carryforwards		489,505			(318,534	)		—			170,971			(22,756	)		—			148,215

Deferred tax assets (liabilities)	W	2,238,410			221,924			(46,771	)		2,413,563			988,759			(14,818	)		3,387,504

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

26.	Earnings (Loss) per Share

(a)

Basic earnings(loss) per share for the years ended December 31, 2023 and 2022 are as follows:


(In won and No. of shares)	2023			2022
Loss for the year	W	(1,718,701,175,934	)		(3,191,386,595,440	)
Weighted-average number of common stocks outstanding		357,815,700			357,815,700

Basic loss per share	W	(4,803	)		(8,919	)

For the years ended December 31, 2023 and 2022, there were no events or transactions that resulted in changes in the number of common stocks used for calculating basic loss per share.

(b)

Diluted loss per share is not different from basic loss per share as there are no dilution effects of potential common stocks for the years ended December 31, 2023 and 2022.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management

The Company is exposed to credit risk, liquidity risk and market risks. The Company identifies and analyzes such risks, and controls are implemented under a risk management system to monitor and manage these risks at below an acceptable level.

(a)

Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Company’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

(i)

Currency risk

The Company is exposed to currency risk on sales, purchases and borrowings that are denominated in a currency other than the functional currency of the Company, Korean won (KRW). The currencies in which these transactions primarily are denominated are USD, JPY, etc.

Interest on borrowings is accrued in the currency of the borrowing. Generally, borrowings are denominated in currencies that match the cash flows generated by the underlying operations of the Company, primarily KRW and USD.

The Company adopts policies to ensure that its net exposure is kept to a manageable level by buying or selling foreign currencies at spot rates when necessary to address short-term imbalances. In respect of monetary assets and liabilities denominated in foreign currencies, the Company manages currency risk through continuously managing the position of foreign currencies, measuring the currency risk and, if necessary, using derivatives such as currency forwards, currency swap and others.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

Exposure to currency risk

The Company’s exposure to foreign currency risk based on notional amounts as of December 31, 2023 and 2022 is as follows:


(In millions)	December 31, 2023
	USD			JPY			CNY			EUR
Cash and cash equivalents		258			104			—			—
Trade accounts and notes receivable		2,364			—			—			—
Other accounts receivables		37			182			—			—
Other assets denominated in foreign currencies		23			—			—			—
Trade accounts and notes payable		(5,741	)		(8,027	)		—			—
Other accounts payable		(490	)		(9,099	)		—			(2	)
Advances received		(1,200	)		—			—			—
Financial liabilities		(2,279	)		—			(345	)		—

		(7,028	)		(16,840	)		(345	)		(2	)

Cross currency interest rate swap contracts(*1)		1,930			—			345			—
Forward exchange contracts(*2)		1,200			—			—			—

Net exposure		(3,898	)		(16,840	)		—			(2	)

(*1)

Of cross currency interest rate swap contracts, USD 500 million and CNY 345 million were entered into to hedge currency risk with respect to foreign currency denominated borrowings and USD 1,430 million were entered into to hedge currency risk and interest rate risk with respect to foreign currency denominated borrowings and bonds.

(*2)	Represents forward exchange contracts entered into by the Company to hedge exchange rate risks with respect to advances received in foreign currency. The contracts are designated as hedging instruments.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued


(In millions)	December 31, 2022
	USD			JPY			CNY			PLN		EUR
Cash and cash equivalents		457			—			—			1		—
Trade accounts and notes receivable		1,906			217			—			—		—
Other accounts receivables		75			112			—			—		3
Other assets denominated in foreign currencies		30			—			—			—		—
Trade accounts and notes payable		(5,451	)		(4,041	)		—			—		—
Other accounts payable		(593	)		(18,611	)		(1	)		—		(6	)
Financial liabilities		(3,111	)		—			—			—		—

		(6,687	)		(22,323	)		(1	)		1		(3	)

Cross currency interest rate swap contracts(*)		2,430			—			—			—		—

Net exposure		(4,257	)		(22,323	)		(1	)		1		(3	)

(*)

Of cross currency interest rate swap contracts, USD 700 million were entered into to hedge currency risk with respect to foreign currency denominated borrowings and USD 1,730 million were entered into to hedge currency risk and interest rate risk with respect to foreign currency denominated borrowings and bonds.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

Average exchange rates applied for the years ended December 31, 2023 and 2022 and the exchange rates at December 31, 2023 and December 31, 2022 are as follows:


(In won)	Average rate				Reporting date spot rate
	2023		2022		December 31, 2023		December 31, 2022
USD	W	1,306.12		1,291.15	W	1,289.40		1,267.30
JPY		9.32		9.85		9.13		9.53
CNY		184.28		191.60		180.84		181.44
PLN		311.36		289.78		329.11		288.70
EUR		1,412.67		1,357.29		1,426.59		1,351.20

ii)

Sensitivity analysis

A weaker won, as indicated below, against the following currencies which comprise the Company’s assets or liabilities denominated in a foreign currency as of December 31, 2023 and 2022, would have increased (decreased) equity and profit or loss by the amounts shown below. This analysis is based on foreign currency exchange rate variances that the Company considers to be reasonably possible at the end of the reporting period. The analysis assumes that all other variables, in particular interest rates, would remain constant. The changes in equity and profit or loss would have been as follows:


(In millions of won)	December 31, 2023						December 31, 2022
	Equity			Profit or loss			Equity			Profit or loss
USD (5 percent weakening)	W	(193,758	)		(193,758	)	W	(207,623	)		(207,623	)
JPY (5 percent weakening)		(5,925	)		(5,925	)		(8,189	)		(8,189	)
CNY (5 percent weakening)		(2	)		(2	)		(7	)		(7	)
PLN (5 percent weakening)		—			—			11			11
EUR (5 percent weakening)		(86	)		(86	)		(156	)		(156	)

A stronger won against the above currencies as of December 31, 2023 and 2022 would have had the equal but opposite effect on the above currencies to the amounts shown above, on the basis that all other variables remain constant.

iii)

Fair value hedging derivatives

In relation to advances received that are dominated in foreign currencies, the Company uses derivative instruments to hedge change of fair value due to foreign currency exchange rate changes. As of December 31, 2023, there is no ineffective portion of the gain or loss on valuation of derivatives to which change of fair value hedging accounting has been applied and loss on valuation amounting to W36,052 million, respectively, (contracted buying amount: USD 1,200 million, contracted exchange rate: W1,289.11~1,310.08) are recognized in profit or loss.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

(ii)

Interest rate risk

Interest rate risk arises principally from the Company’s variable interest-bearing bonds and borrowings. The Company establishes and applies its policy to reduce uncertainty arising from fluctuations in interest rates and to minimize finance cost and manages interest rate risk by monitoring of trends of fluctuations in interest rate and establishing plan for countermeasures. Meanwhile, the Company entered into cross currency interest rate swap contracts amounting to USD 1,430 million (W1,843,842 million) and interest rate swap contracts amounting to W980,000 million in notional amount to hedge interest rate risk with respect to variable interest bearing borrowings.

Profile

The interest rate profile of the Company’s interest-bearing financial instruments as of December 31, 2023 and 2022 is as follows:


(In millions of won)	December 31, 2023			December 31, 2022
Fixed rate instruments
Financial assets	W	354,502			735,116
Financial liabilities		(6,156,590	)		(5,843,924	)

	W	(5,802,088	)		(5,108,808	)

Variable rate instruments
Financial liabilities	W	(3,545,515	)		(3,217,216	)

ii)

Equity and profit or loss sensitivity analysis for variable rate instruments

As of December 31, 2023 and 2022, a change of 100 basis points in interest rates at the reporting date would have increased (decreased) equity and profit or loss by the amounts shown below for the respective following 12 month periods. This analysis assumes that all other variables, in particular foreign currency rates, remain constant.


(In millions of won)
	Equity					Profit or loss
	1%p increase			1%p decrease		1%p increase			1%p decrease
December 31, 2023
Variable rate instruments(*)	W	(5,568	)		5,568		(5,568	)		5,568
December 31, 2022
Variable rate instruments(*)	W	(4,270	)		4,270		(4,270	)		4,270

(*)

Financial instruments related to non-hedging interest rate swap are excluded from the calculation.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

(b)

Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s receivables from customers.

The Company’s exposure to credit risk of trade and other receivables is influenced mainly by the individual characteristics of each customer. However, management believes that the default risk of the country in which each customer operates, does not have a significant influence on credit risk since the majority of the customers are global electronic appliance manufacturers operating in global markets.

The Company establishes credit limits for each customer and each new customer is analyzed quantitatively and qualitatively before determining whether to utilize third party guarantees, insurance or factoring as appropriate.

In relation to the impairment of financial assets subsequent to initial recognition, the Company recognizes the changes in expected credit loss (“ECL”) in profit or loss at each reporting date.

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk as of December 31, 2023 and 2022 is as follows:


(In millions of won)
	December 31, 2023		December 31, 2022
Financial assets carried at amortized cost
Cash equivalents	W	334,502		692,312
Deposits in banks		20,011		42,815
Trade accounts and notes receivable, net		3,077,901		2,475,920
Non-trade receivables		108,769		147,355
Accrued income		242		1,125
Deposits		8,538		8,317
Loans		59,884		88,868

	W	3,609,847		3,456,712

Financial assets at fair value through profit or loss
Convertible securities	W	1,838		1,797
Derivatives		169,703		230,080

	W	171,541		231,877

	W	3,781,388		3,688,589

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

In addition to the financial assets above, as of December 31, 2023, the Company provides payment guarantees in connection with the principal amount of credit facilities amounting to USD 1,462 million (W1,884,673 million) (see note 15).

Trade accounts and notes receivable are insured in order for the Company to manage credit risk if they do not meet the Company’s internal credit ratings. Uninsured trade accounts and notes receivable are managed by continuous monitoring of internal credit rating standards established by the Company and seeking insurance coverage, if necessary.

(c)

Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or other financial assets. The Company’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation.

The Company has historically been able to satisfy its cash requirements from cash flows from operations and debt and equity financing. To the extent that the Company does not generate sufficient cash flows from operations to meet its capital requirements, the Company may rely on other financing activities, such as external long-term borrowings and offerings of debt instruments, equity-linked and other debt instruments and equity financing. In addition, the Company maintains a line of credit with various banks.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

The following are the contractual maturities of financial liabilities, including estimated interest payments, as of December 31, 2023.


(In millions of won)			Contractual cash flows in
	Carrying amount		Total		6 months or less		6-12 months		1-2 years		2-5 years		More than 5 years
Non-derivative financial liabilities
Borrowings	W	8,213,962		8,868,714		2,482,724		1,313,880		3,351,277		1,720,833		—
Bonds		1,488,143		1,597,741		111,169		319,011		642,996		524,565		—
Trade accounts and notes payable		8,993,964		8,993,964		8,788,397		205,567		—		—		—
Other accounts payable		1,242,109		1,244,637		1,178,845		65,792		—		—		—
Other accounts payable (enterprise procurement cards)(*1)		1,092,180		1,092,180		938,899		153,281		—		—		—
Long-term other accounts payable		343,845		398,451		—		—		114,783		175,358		108,310
Payment guarantee(*2)		20,613		2,400,449		231,501		159,599		520,857		1,144,481		344,011
Security deposits received		153,316		190,275		3,120		4,550		1,040		181,565		—
Lease liabilities		14,400		15,014		6,145		5,953		1,838		916		162
Derivative financial liabilities
Derivatives	W	63,526		45,705		18,781		3,988		12,474		10,462		—
Derivatives for fair value hedge		36,052		36,052		1,514		5,878		20,282		8,378		—

	W	21,662,110		24,883,182		13,761,095		2,237,499		4,665,547		3,766,558		452,483

(*1)

Represents liabilities payable to credit card companies for purchase of raw material and others paid using enterprise procurement cards. The Company presented the payable to credit card companies as other accounts payable and disclosed related cash flows as operating activities since the Company is using the enterprise procurement cards through agreements with suppliers for transactions arising from purchasing of goods and services, the payment term is within a year from the purchase, as part of the normal operating cycle, and no security is provided.

Change in liabilities related to procurement cards for the year ended December 31, 2023 is as follows:

(In millions of won)

January 1, 2023

Change
(Cash flows from
operation activities)

December 31, 2023

Other accounts payable (enterprise procurement cards)

935,739

156,441

1,092,180

(*2)	Contractual cash flows of payment guarantee is identical to timing of principal and interest payment and represent the maximum amount that the Company could be required to pay the guarantee amount.

It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different amounts.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

The following are the contractual maturities of financial liabilities, including estimated interest payments, as of December 31, 2022.


(In millions of won)			Contractual cash flows in
	Carrying amount		Total		6 months or less			6-12 months		1-2 years		2-5 years		More than 5 years
Non-derivative financial liabilities
Borrowings	W	7,612,394		8,114,753		3,237,943			693,026		2,073,216		2,110,568		—
Bonds		1,448,746		1,570,630		338,815			16,956		400,764		727,752		86,343
Trade accounts and notes payable		8,391,251		8,391,251		7,852,665			538,586		—		—		—
Other accounts payable		1,877,611		1,880,067		1,826,813			53,254		—		—		—
Other accounts payable (enterprise procurement cards)(*1)		935,739		935,739		935,739			—		—		—		—
Long-term other accounts payable		408,019		479,091		—			—		106,479		212,932		159,680
Payment guarantee(*2)		19,241		2,044,747		305,339			204,869		320,811		862,085		351,643
Security deposits received		146,773		191,720		—			2,260		8,450		181,010		—
Lease liabilities		5,952		6,320		1,807			1,488		1,899		704		422
Derivative financial liabilities
Derivatives	W	47,408		29,418		(1,637	)		10,741		3,024		17,290		—

	W	20,893,134		23,643,736		14,497,484			1,521,180		2,914,643		4,112,341		598,088

(*1)

Represents liabilities payable to credit card companies for utility expenses and others paid using enterprise procurement cards. The Company presented the payable to credit card companies as other accounts payable and disclosed related cash flows as operating activities since the Company is using the enterprise procurement cards through agreements with suppliers for transactions arising from purchasing of goods and services, the payment term is within a year from the purchase, as part of the normal operating cycle, and no security is provided.

Change in liabilities related to procurement cards for the year ended December 31, 2022 is as follows:


(In millions of won)
	January 1, 2022		Change (Cash flows from operation activities)			December 31, 2022
Other accounts payable (enterprise procurement cards)	W	1,074,089		(138,350	)		935,739

(*2)	Contractual cash flows of payment guarantee is identical to timing of principal and interest payment and represent the maximum amount that the Company could be required to pay the guarantee amount.

It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different amounts.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

(d)

Capital Management

Management’s policy is to maintain a capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. Liabilities to equity ratio, net borrowings to equity ratio and other financial ratios are used by management to achieve an optimal capital structure. Management also monitors the return on capital as well as the level of dividends to ordinary shareholders.


(In millions of won)
	December 31, 2023		December 31, 2022
Total liabilities	W	24,050,857		21,908,600
Total equity		5,681,555		7,350,439
Cash and deposits in banks (*1)		354,502		735,116
Borrowings (including bonds)		9,702,105		9,061,140
Total liabilities to equity ratio		423%		298%
Net borrowings to equity ratio (*2)		165%		113%

(*1)

Cash and deposits in banks consist of cash and cash equivalents and current deposits in banks.

(*2)

Net borrowings to equity ratio is calculated by dividing total borrowings (including bonds and excluding lease liabilities and others) less cash and current deposits in banks by total equity.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

(e)

Determination of fair value

(i)

Measurement of fair value

A number of the Company’s accounting policies and disclosures require the determination of fair value, for both financial and non-financial assets and liabilities. Fair values have been determined for measurement and/or disclosure purposes based on the following methods. When applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.

Current assets and liabilities

The carrying amounts approximate their fair value because of the short maturity of these instruments.

ii)

Trade receivables and other receivables

The fair value of trade and other receivables is estimated as the present value of future cash flows, discounted at the market rate of interest at the reporting date. This fair value is determined for disclosure purposes. The carrying amounts of current receivables approximate their fair value.

iii)

Investments in equity and debt securities

The fair value of marketable financial assets at FVTPL and FVOCI is determined by reference to their quoted closing bid price at the reporting date. The fair value of non-marketable instruments is determined using the results of fair value assessment performed by external valuation institutions and others.

iv)

Non-derivative financial liabilities

Fair value, which is determined for disclosure purposes, except for the liabilities at FVTPL, is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of interest at the reporting date.

Derivatives

The inputs used to measure the fair value of currency forward and cross currency interest rate swap are calculated based on the exchange rates and interest rates observable in the market at the reporting date.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

(ii)

Fair values versus carrying amounts

The fair values of financial assets and liabilities, together with the carrying amounts shown in the separate statement of financial position as of December 31, 2023 and 2022 are as follows:


(In millions of won)	December 31, 2023				December 31, 2022
	Carrying amounts		Fair values		Carrying amounts		Fair values
Financial assets carried at amortized cost
Cash and cash equivalents	W	334,502		(*)		692,312		(*)
Deposits in banks		20,011		(*)		42,815		(*)
Trade accounts and notes receivable		3,077,901		(*)		2,475,920		(*)
Non-trade receivables		108,769		(*)		147,355		(*)
Accrued income		242		(*)		1,125		(*)
Deposits		8,538		(*)		8,317		(*)
Loans		59,884		(*)		88,868		(*)
Financial assets at fair value through profit or loss
Equity instruments	W	3,967		3,967		10,484		10,484
Convertible securities		1,838		1,838		1,797		1,797
Derivatives		169,703		169,703		230,080		230,080
Financial liabilities at fair value through profit or loss
Derivatives	W	63,526		63,526		47,408		47,408
Financial liabilities effective for fair value hedging
Derivatives	W	36,052		36,052		—		—
Financial liabilities carried at amortized cost
Borrowings	W	8,213,962		8,248,441		7,612,394		7,561,919
Bonds		1,488,143		1,479,725		1,448,746		1,377,696
Trade accounts and notes payable		8,993,964		(*)		8,391,251		(*)
Other accounts payable		2,678,134		(*)		3,221,369		(*)
Payment guarantee liabilities		20,613		(*)		19,241		(*)
Security deposits received		153,316		(*)		146,773		(*)
Lease liabilities		14,400		(*)		5,952		(*)

(*)

Excluded from disclosures as the carrying amount approximates fair value.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

(iii)

Fair values of financial assets and liabilities

Fair value hierarchy

Financial instruments carried at fair value are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques. The different levels have been defined as follows:

•

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities

•

Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly

•

Level 3: inputs for the asset or liability that are not based on observable market data

ii)

Valuation techniques and inputs for Assets and Liabilities measured by the fair value hierarchy

(In millions of won)

December 31, 2023

Valuation technique

Input

Classification

Level 1

Level 2

Level 3

Financial assets at fair value through profit or loss

Equity instruments

—

3,967

Discounted cash
flow, etc.

Discount rate and
Estimated cash flow, etc.

Convertible securities

—

1,838

Blended discount
model and binominal
option pricing model

Discount rate, stock
price and volatility

Derivatives

—

169,703

—

Discounted cash flow

Discount rate and
Exchange rate

Financial liabilities at fair value through profit or loss

Derivatives

—

63,526

—

Discounted cash flow

Discount rate and
Exchange rate

Financial liabilities effective for fair value hedging

Derivatives

—

36,052

—

Discounted cash flow

Discount rate and
Exchange rate

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

(In millions of won)

December 31, 2022

Valuation technique

Input

Classification

Level 1

Level 2

Level 3

Financial assets at fair value through profit or loss

Equity instruments

—

10,484

Discounted cash
flow, etc.

Discount rate and
Estimated cash flow, etc.

Convertible securities

—

1,797

Blended discount
model and binominal
option pricing model

Discount rate, stock
price and volatility

Derivatives

—

230,080

—

Discounted cash flow

Discount rate and
Exchange rate

Financial liabilities at fair value through profit or loss

Derivatives

—

47,408

—

Discounted cash flow

Discount rate and
Exchange rate

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

iii)

Financial instruments not measured at fair value but for which the fair value is disclosed

Fair value hierarchy classifications, valuation technique and inputs for fair value measurements of the financial instruments not measured at fair value but for which the fair value is disclosed as of December 31, 2023 and December 31, 2022 are as follows:

(In millions of won)

December 31, 2023

Valuation technique

Input

Classification

Level 1

Level 2

Level 3

Liabilities

Borrowings

—

8,248,441

Discounted cash flow

Discount rate

Bonds

—

1,479,725

Discounted cash flow

Discount rate

(In millions of won)

December 31, 2022

Valuation technique

Input

Classification

Level 1

Level 2

Level 3

Liabilities

Borrowings

—

7,561,919

Discounted cash flow

Discount rate

Bonds

—

1,377,696

Discounted cash flow

Discount rate

iv)

The interest rates applied for determination of the above fair value as of December 31, 2023 and 2022 are as follows:


	December 31, 2023	December 31, 2022
Borrowings, bonds and others	4.60~5.02%	5.11~6.68%

There is no transfer between Level 1, Level 2 and Level 3 for the years ended December 31, 2023 and 2022, and the changes in financial assets classified as Level 3 of fair value measurements for the year ended December 31, 2023 and 2022 is as follows:


(In millions of won)
Classification	January 1, 2023		Valuation			December 31, 2023
Equity instruments	W	10,484		(6,517	)		3,967
Convertible securities		1,797		41			1,838


(In millions of won)
Classification	January 1, 2022		Acquisition		Replacement		Valuation			December 31, 2022
Equity instruments	W	3,096		150		10,620		(3,382	)		10,484
Convertible securities		1,573		—		—		224			1,797

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

27.	Financial Risk Management, Continued

(f)

Net gains and losses by category of financial instruments

The net gains and losses by category of financial instruments as of December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023
	Financial assets at amortized cost			Financial liabilities at amortized cost			Financial assets at FVTPL			Financial assets at FVOCI			Derivatives			Total
Interest income	W	14,922			—			—			—			—			14,922
Interest expense		—			(434,455	)		—			—			—			(434,455	)
Foreign currency differences		(30,856	)		(160,240	)		—			—			(36,052	)		(227,148	)
Reversal of bad debt expense		3			—			—			—			—			3
Gain or loss on disposal		(899	)		(167	)		—			(329	)		—			(1,395	)
Gain or loss on valuation		—			—			(6,476	)		—			—			(6,476	)
Gain or loss on derivative		—			—			—			—			102,116			66,065

	W	(16,830	)		(594,862	)		(6,476	)		(329	)		66,064			(552,432	)


(In millions of won)
	2022
	Financial assets at amortized cost			Financial liabilities at amortized cost			Financial assets at FVTPL			Financial liabilities at FVTPL			Derivatives (*)		Total
Interest income	W	11,825			—			—			—			—		11,825
Interest expense		—			(177,649	)		—			(11,106	)		—		(188,755	)
Foreign currency differences		505,729			(512,232	)		—			(105,492	)		—		(111,995	)
Bad debt expense		(146	)		—			—			—			—		(146	)
Gain or loss on disposal		(645	)		—			—			(2,672	)		—		(3,317	)
Gain or loss on valuation		—			—			(3,158	)		220,240			—		217,082
Gain or loss on derivative		—			—			—			—			177,130		177,130
Others		—			—			—			(43	)		—		(43	)

	W	516,763			(689,881	)		(3,158	)		100,927			177,130		101,781

(*)

Other financial instruments exclude cash flow hedging derivatives.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

28.

Leases

(a)

Leases as lessee

The Company leases buildings, vehicles, machinery and equipment and others. Information about leases for which the Company is a lessee is presented below.

(i)

Right-of-use assets

Right-of-use assets related to leased properties that do not meet the definition of investment property are presented as property, plant and equipment as of December 31, 2023 and 2022(see Note 9(a)).

Changes in right-of-use assets for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023
	Buildings			Land			Machinery and equipment			Vehicles			Others			Total
Balance at January 1	W	189			23			365			4,787			96			5,460
Additions		16,920			—			882			3,622			144			21,568
Depreciation		(8,602	)		(23	)		(714	)		(3,646	)		(45	)		(13,030	)

Balance at December 31	W	8,507			—			533			4,763			195			13,998


(In millions of won)
	2022
	Buildings			Land			Machinery and equipment			Vehicles			Others			Total
Balance at January 1	W	32			36			983			4,198			41			5,290
Additions		9,177			460			173			4,277			96			14,183
Depreciation		(8,942	)		(40	)		(788	)		(3,528	)		(41	)		(13,339	)
Impairment		(78	)		(13	)		(3	)		(160	)		—			(254	)
Others		—			(420	)		—			—			—			(420	)

Balance at December 31	W	189			23			365			4,787			96			5,460

(ii)

Amounts recognized in profit or loss not from right-of-use assets for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023			2022
Interest on lease liabilities	W	(481	)		(330	)
Income from sub-leasing right-of-use assets		—			8
Expenses relating to short-term leases		(158	)		(73	)
Expenses relating to leases of low-value assets		(915	)		(555	)

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

28.	Leases, Continued

(iii)

Changes in lease liabilities for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023			2022
Balance at January 1	W	5,952			5,219
Additions		20,846			13,865
Interest expense		481			330
Repayment of liabilities		(12,879	)		(13,462	)

Balance at December 31	W	14,400			5,952

(b)

Leases as lessor

The Company leases out investment property and a portion of property, plant and equipment as operating leases (Notes 9 and 11).

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

29.	Changes in liabilities arising from financing activities

Changes in liabilities arising from financing activities for the year ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	January 1, 2023					Non-cash transactions
	January 1, 2023		Cash flows from financing activities			Gain or loss on foreign currency translation		Effective interest adjustment		Others			December 31, 2023
Short-term borrowings	W	1,952,289		(528,095	)		4,019		—		—			1,428,213
Payment guarantee liabilities		19,241		5,061			—		—		(3,689	)		20,613
Long-term borrowings		5,660,105		1,061,704			57,803		3,271		2,866			6,785,749
Bonds		1,448,746		35,276			2,237		1,717		167			1,488,143
Lease liabilities		5,952		(12,879	)		—		—		21,327			14,400

	W	9,086,333		561,067			64,059		4,988		20,671			9,737,118

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

29.	Changes in liabilities arising from financing activities, continued


(In millions of won)
	January 1, 2022					Non-cash transactions
	January 1, 2022		Cash flows from financing activities			Gain or loss on foreign currency translation		Effective interest adjustment		Others			December 31, 2022
Short-term borrowings	W	—		1,945,530			6,759		—		—			1,952,289
Payment guarantee liabilities		6,208		4,945			—		—		8,088			19,241
Long-term borrowings		4,948,538		595,372			123,593		—		(7,398	)		5,660,105
Bonds (*)		2,611,561		(1,071,560	)		113,669		12,644		(217,568	)		1,448,746
Lease liabilities		5,219		(13,462	)		13		—		14,182			5,952
Dividend payable		—		(232,580	)		—		—		232,580			—

	W	7,571,526		1,228,245			244,034		12,644		29,884			9,086,333

(*)	Others include W220,240 million of gain on valuation of financial liabilities at fair value through profit or loss and W2,672 million of loss on early repayment of borrowings and bonds.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others

(a)

Related parties

Related parties as of December 31, 2023 are as follows:


Classification		Description
Subsidiaries(*)		LG Display America, Inc. and others
Associates(*)		Paju Electric Glass Co., Ltd. and others
Entity that has significant influence over the Company		LG Electronics Inc.
Subsidiaries of the entity that has significant influence over the Company		Subsidiaries of LG Electronics Inc.

(*)

Details of subsidiaries and associates are described in Note 8.

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others, Continued

(b)

Significant transactions such as sales of goods and purchases of raw material and outsourcing service and others, which occurred in the normal course of business with related parties for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)	2023
					Purchase and others
	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Subsidiaries
LG Display America, Inc.	W	11,836,330		—		—		—		—		31
LG Display Japan Co., Ltd.		886,532		—		—		—		—		367
LG Display Germany GmbH		1,179,578		—		—		—		—		24,493
LG Display Taiwan Co., Ltd.		1,630,390		—		—		—		—		1,585
LG Display Nanjing Co., Ltd.		105,478		425,666		4,375		—		1,505,802		12,173
LG Display Shanghai Co., Ltd.		481,138		—		—		—		—		—
LG Display Guangzhou Co., Ltd.		25,122		1,042,837		56,020		—		1,315,826		17,964
LG Display Shenzhen Co., Ltd.		427,220		—		—		—		—		—
LG Display Yantai Co., Ltd.		895		345,527		16,653		—		363,168		1,586
LG Display (China) Co., Ltd.		1,325		57,966		994,229		—		—		1,562
LG Display Singapore Pte. Ltd.		1,141,925		—		—		—		—		128
L&T Display Technology (Fujian) Limited		117,993		8,496		4		—		—		179
Nanumnuri Co., Ltd.		238		—		—		—		—		23,671
LG Display Guangzhou Trading Co., Ltd.		450,139		—		—		—		—		—
LG Display Vietnam Haiphong Co., Ltd.		31,514		—		98,918		—		2,609,864		32,327
Suzhou Lehui Display Co., Ltd.		99,047		—		3		—		23,076		28
LG Display High-Tech (China) Co., Ltd.		5,537		—		3,869		—		2,434,753		4,515

	W	18,420,401		1,880,492		1,174,071		—		8,252,489		120,609

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others, Continued


(In millions of won)	2023
					Purchase and others
	Sales and Others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Associates	W
WooRee E&L Co., Ltd.		—		—		455		—		—		513
AVATEC Co., Ltd.		—		—		452		—		43,210		11,002
Paju Electric Glass Co., Ltd.		—		15,200		176,831		—		—		4,341
YAS Co., Ltd.		—		—		9,832		9,480		—		5,755
Material Science Co., Ltd.		—		—		—		—		—		179

	W	—		15,200		187,570		9,480		43,210		21,790

Entity that has significant influence over the Company
LG Electronics Inc.	W	211,627		—		12,739		55,956		—		156,490

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others, Continued


(In millions of won)	2023
					Purchase and others
	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Subsidiaries of the entity that has significant influence over the Company
LG Electronics India Pvt. Ltd.	W	47,031		—		—		—		—		270
LG Electronics Vietnam Haiphong Co., Ltd.		434,789		—		—		—		—		967
LG Electronics Reynosa S.A. DE C.V.		29,314		—		—		—		—		810
LG Electronics U.S.A., Inc.		—		—		—		—		—		2,177
LG Electronics RUS, LLC		—		—		—		—		—		2,359
LG Electronics Egypt S.A.E.		20,225		—		—		—		—		46
LG Innotek Co., Ltd.		7,229		—		18		—		—		100,272
P.T. LG Electronics Indonesia		25,520		—		—		—		—		2,231
Others		24,443		—		8		—		—		16,366

	W	588,551		—		26		—		—		125,498

	W	19,220,579		1,895,692		1,374,406		65,436		8,295,699		424,387

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others, Continued


(In millions of won)	2022
					Purchase and others
	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Subsidiaries
LG Display America, Inc.	W	13,001,049		—		—		—		—		35
LG Display Japan Co., Ltd.		1,728,731		—		—		—		—		1
LG Display Germany GmbH		1,702,896		—		—		—		—		68,197
LG Display Taiwan Co., Ltd.		2,031,209		—		—		—		—		1,374
LG Display Nanjing Co., Ltd.		67,085		—		4,127		—		1,804,509		23,162
LG Display Shanghai Co., Ltd.		398,982		—		—		—		—		3
LG Display Guangzhou Co., Ltd.		14,286		—		60,547		—		2,052,874		21,585
LG Display Shenzhen Co., Ltd.		843,327		—		—		—		—		—
LG Display Yantai Co., Ltd.		253		—		21,090		—		464,499		2,888
LG Display (China) Co., Ltd.		1,140		115,842		1,702,216		—		—		1,977
LG Display Singapore Pte. Ltd.		1,837,597		—		—		—		—		446
L&T Display Technology (Fujian) Limited		225,062		—		—		—		—		427
Nanumnuri Co., Ltd.		226		2,000		—		—		—		24,898
LG Display Guangzhou Trading Co., Ltd.		567,376		—		—		—		—		—
LG Display Vietnam Haiphong Co., Ltd.		16,078		—		47,696		—		2,592,953		38,647
Suzhou Lehui Display Co., Ltd.		274,509		—		66,463		—		416		26
LG Display High-Tech (China) Co., Ltd.		2,241				6,262		—		2,747,323		3,457

	W	22,712,047		117,842		1,908,401		—		9,662,574		187,123

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others, Continued


(In millions of won)	2022
					Purchase and others
	Sales and Others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Associates
WooRee E&L Co., Ltd.	W	—		—		661		—		—		2
AVATEC Co., Ltd.		—		—		58		—		64,492		3,617
Paju Electric Glass Co., Ltd.		—		4,361		245,962		—		—		2,942
YAS Co., Ltd.		—		100		14,291		22,440		—		8,038
Material Science Co., Ltd.		—		—		17		—		—		—

	W	—		4,461		260,989		22,440		64,492		14,599

Entity that has significant influence over the Company
LG Electronics Inc.	W	229,270		—		12,179		289,262		—		126,127

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others, Continued


(In millions of won)	2022
					Purchase and others
	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Subsidiaries of the entity that has significant influence over the Company
LG Electronics India Pvt. Ltd.	W	70,514		—		—		—		—		519
LG Electronics Vietnam Haiphong Co., Ltd.		468,380		—		—		—		—		882
LG Electronics Reynosa S.A. DE C.V.		38,435		—		—		—		—		958
LG Electronics U.S.A., Inc.		—		—		—		—				2,315
LG Electronics RUS, LLC		—		—		—		—		—		273
LG Electronics Egypt S.A.E.		72,055		—		—		—		—		212
LG Innotek Co., Ltd.		27,255		—		49		—		—		79,515
P.T. LG Electronics Indonesia		42,128		—		—		—		—		1,415
Others		37,785		—		58		—		—		19,857

	W	756,552		—		107		—		—		105,946

	W	23,697,869		122,303		2,181,676		311,702		9,727,066		433,795

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others, Continued


(In millions of won)
	Trade accounts and notes receivable and others				Trade accounts and notes payable and others
	December 31, 2023		December 31, 2022		December 31, 2023		December 31, 2022
Subsidiaries
LG Display America, Inc.	W	1,817,773		1,193,850		4		6
LG Display Japan Co., Ltd.		134,107		142,262		26		—
LG Display Germany GmbH		50,322		20,386		3,234		26,855
LG Display Taiwan Co., Ltd.		60,663		77,003		96		77
LG Display Nanjing Co., Ltd.		2,869		181		1,796,033		1,126,398
LG Display Shanghai Co., Ltd.		241,039		184,266		—		—
LG Display Guangzhou Co., Ltd.		205		302		1,241,145		1,108,647
LG Display Guangzhou Trading Co., Ltd.		287,296		337,114		—		—
LG Display Shenzhen Co., Ltd.		75,709		108,860		—		—
LG Display Yantai Co., Ltd.		1		4		228,364		252,662
LG Display (China) Co., Ltd.		2,452		2,371		451,003		701,819
LG Display Singapore Pte. Ltd.		24,171		43,891		3		3
L&T Display Technology (Fujian) Limited		24,690		22,452		103,501		114,134
Nanumnuri Co., Ltd.		—		—		2,316		2,121
LG Display Vietnam Haiphong Co., Ltd.		23,402		37,050		1,180,951		1,198,073
Suzhou Lehui Display Co., Ltd.		24,829		13,208		2,532		7,600
LG Display High-Tech (China) Co., Ltd.		34,268		32,272		1,730,516		1,106,458

	W	2,803,796		2,215,472		6,739,724		5,644,853

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others, Continued


(In millions of won)
	Trade accounts and notes receivable and others				Trade accounts and notes payable and others
	December 31, 2023		December 31, 2022		December 31, 2023		December 31, 2022
Associates
WooRee E&L Co., Ltd.	W	695		878		645		152
AVATEC Co., Ltd.		—		—		4,775		3,756
Paju Electric Glass Co., Ltd.		—		—		56,136		30,431
YAS Co., Ltd.		—		—		7,875		5,827
Material Science Co., Ltd.		—		—		118		—

	W	695		878		69,549		40,166

Entity that has significant influence over the Company
LG Electronics Inc.(*1)	W	62,027		67,953		1,044,258		90,225

(*1)	Trades accounts and notes payable and others for LG Electronics Inc. as of December 31, 2023 includes long-term borrowings of W1,000,000 million (see note 12.(c))

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others, Continued


(In millions of won)
	Trade accounts and notes receivable and others				Trade accounts and notes payable and others
	December 31, 2023		December 31, 2022		December 31, 2023		December 31, 2022
Subsidiaries of the entity that has significant influence over the Company
LG Innotek Co., Ltd.(*2)	W	2,521		3,646		211,476		204,067
P.T. LG Electronics Indonesia		3,771		4,524		108		195
LG Electronics Reynosa S.A. DE C.V.		3,814		1,749		109		167
LG Electronics India Pvt. Ltd.		2,013		5,669		35		15
LG Electronics Vietnam Haiphong Co., Ltd.		76,952		50,173		211		53
LG Electronics RUS, LLC		—		—		203		—
LG Electronics Egypt S.A.E		369		2,008		1		—
Others		6,122		3,030		1,811		4,495

	W	95,562		70,799		213,954		208,992

	W	2,962,080		2,355,102		8,067,485		5,984,236

(*2)

Including deposits received amount W180,000 million from lease agreement

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others, Continued

(d)

Details of significant financing transactions with related parties for the year ended December 31, 2023, are as follows:


(In millions of won)
	Company Name	Borrowings		Collection of loans
Entity that has significant influence over the Company	LG Electronics Inc.	W	1,000,000
Associates	WooRee E&L Co., Ltd				183

The Company entered into a loan agreement with LG Electronics Inc. on March 27, 2023 for a total borrowing amount of W1,000,000 million, and received W650,000 million on March 30, 2023 and W350,000 million on April 20, 2023. The repayment plan is instalment payment for a period of one year, granting grace period of two years, the maturity date is March 30, 2026 (see note 12(c)).

100

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others, Continued

(e)

Conglomerate Transactions

Transactions, trade accounts and notes receivable and payable, and others between the Company and certain companies and their subsidiaries included in LG Group, one of the conglomerates in the Republic of Korea according to the Monopoly Regulation and Fair Trade Act as of and for the years ended December 31, 2023 and 2022 are as follows. These entities are not related parties according to K-IFRS No. 1024, Related Party Disclosures.


(In millions of won)

	2023				December 31, 2023
	Sales and others		Purchase and others		Trade accounts and notes receivable and others		Trade accounts and notes payable and others
LG Uplus Corp.	W	—		2,451		—		206
LG Chem Ltd. and its subsidiaries		252		354,072		18		155,312
D&O Corp. and its subsidiaries		308		434,179		—		69,503
LG Corp.		1,891		51,906		16,261		5,575
LG Management Development Institute		—		40,217		—		543
LG CNS Co., Ltd. and its subsidiaries		—		210,882		—		89,939
HS Ad Inc. (formerly, G2R Inc.) and its subsidiaries (*)		—		19,226		—		5,687
Robostar Co., Ltd.		—		708		—		217

	W	2,451		1,113,641		16,279		326,982

(*)

G2R Inc. renamed its name as HS Ad Inc. on July 1, 2023.

101

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others, Continued


(In millions of won)

	2023				December 31, 2022
	Sales and others		Purchase and others		Trade accounts and notes receivable and others		Trade accounts and notes payable and others
LX International Corp. and its subsidiaries (*1)	W	180,596		57,629		—		—
LG Uplus Corp.		—		2,604		—		349
LG Chem Ltd. and its subsidiaries		311		354,435		39		61,125
D&O Corp. (formerly, S&I Corp.) and its subsidiaries (*2)		321		727,747		—		195,059
LX Semicon Co., Ltd.(*1)		—		241,683		—		—
LG Corp.		—		60,592		14,979		6,287
LG Management Development Institute		—		34,195		—		524
LG CNS Co., Ltd. and its subsidiaries		16		199,278		17		77,533
G2R Inc. and its subsidiaries		—		39,975		—		11,193
Robostar Co., Ltd.		—		1,258		—		133
LG Household & Health Care Ltd.		—		28		—		—

	W	181,244		1,719,424		15,035		352,203

(*1)

The separation of LX affiliates was approved by the Fair Trade Commission on June 21, 2022.

(*2)

S&I Corp. renamed its name as D&O Corp. on April 1, 2022.

102

LG DISPLAY CO., LTD.

Notes to the Separate Financial Statements

For the years ended December 31, 2023 and 2022

30.	Related Parties and Others, Continued

(f)

Key management personnel compensation

Compensation costs of key management for the years ended December 31, 2023 and 2022 are as follows:


(In millions of won)
	2023		2022
Short-term benefits	W	2,291		2,305
Expenses related to the defined benefit plan		355		417

	W	2,646		2,722

Key management refers to the registered directors who have significant control and responsibilities over the Company’s operations and business.

31.	Supplemental Cash Flow Information

Supplemental cash flow information for the years ended December 31, 2023 and 2022 is as follows:


(In millions of won)
	2023			2022
Non-cash investing and financing activities:
Changes in other accounts payable arising from the purchase of property, plant and equipment	W	(459,089	)		479,486
Changes in other accounts payable arising from the purchase of intangible assets		(25,577	)		(101,392	)
Recognition of right-of-use assets and lease liabilities		21,568			14,183

32.	Subsequent Event

On December 18, 2023, the Board of Directors of the Company adopted a resolution to approve the Company’s proposed paid-in capital increase (the “Capital Increase”). The Capital Increase will be executed through a share rights offering to the Company’s existing shareholders. Expected date of listing of the new shares in Korea Exchange is March 26, 2024. As of the date of the authorization of these separate financial statements, the total proposed offering amount is expected to be W1,431,796 million (142,184,300 common shares, at the price of W10,070 per share), which is subject to change upon finalization of the subscription price on March 4, 2024. The expected gross proceeds from the Capital Increase will be used for facility investment, working capital and debt repayment.

103

Independent Auditors’ Report on Internal Control over Financial Reporting

Based on a Report Originally Issued in Korean

To the Shareholders and Board of Directores of

LG Display Co., Ltd.

Opinion on Internal Control over Financial Reporting

We have audited LG Display Co., Ltd. (the “Company”)’ internal control over financial reporting (“ICFR”) as of December 31, 2023, based on the criteria established in the Conceptual Framework for Designing and Operating ICFR(“ICFR Design and Operation Framework”) issued by the Operating Committee of ICFR in the Republic of Korea(the “ICFR Committee”).

In our opinion, the Company maintained, in all material respects, effective ICFR as of December 31, 2023, based on internal control over financial reporting Design and Operation Framework.

We also have audited, in accordance with Korean Standards on Auditing (“KSAs”), the separate financial statements of the Company, which comprise the separate statements of financial position as of December 31, 2023 and 2022, the separate statements of comprehensive loss, changes in equity, and cash flows for the years then ended, and notes, comprising material accounting policy information and other explanatory information, and our report dated March 7, 2024 expressed an unmodified opinion on those separate financial statements.

Basis for Opinion on Internal Control over Financial Reporting

We conducted our audit in accordance with KSAs. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Internal Control over Financial Reporting section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the ICFR in the Republic of Korea, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Responsibilities of Management and Those Charged with Governance for the Internal Control over Financial Reporting

The Company’s management is responsible for designing, operating, and maintaining effective ICFR, and for its assessment about the effectiveness of ICFR, included in the accompanying Report on the Operation Status of Internal Control over Financial Reporting.

Those charged with governance are responsible for overseeing the Company’s ICFR.

Auditors’ Responsibilities for the Audit of the Internal Control over Financial Reporting

Our responsibility is to express an opinion on the Company’s ICFR based on our audit. We conducted our audit in accordance with KSAs. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective ICFR was maintained in all material respects.

Our audit of ICFR included obtaining an understanding of ICFR, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

Definition and Limitations of Internal Control over Financial Reporting

A company’s ICFR is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of separate financial statements for external purposes in accordance with Korean International Financial Reporting Standards(“K-IFRS”). A company’s ICFR includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately

104

and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of separate financial statements in accordance with K-IFRS and that receipts and expenditures of the entity are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention, or timely detection and correction of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the separate financial statements.

Because of its inherent limitations, ICFR s may not prevent, or detect and correct material misstatements in the separate financial statements. Also, projections of any assessment of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

The engagement partner on the audit resulting in this independent auditors’ report is In Hye Kang.

KPMG Samjong Accounting Corp.

Seoul, Korea

March 7, 2024

This report is effective as of March 7, 2024, the audit report date. Certain subsequent events or circumstances, which may occur between the audit report date and the time of reading this report, could have a material impact on the Company’s internal control over financial reporting. Accordingly, the readers of the audit report should understand that the above audit report has not been updated to reflect the impact of such subsequent events or circumstances, if any.

105

Report on the Operation of Internal Control over Financial Reporting

Based on a report originally issued in Korean

To the Shareholders, Board of Directors and Audit Committee of LG Display Co., Ltd.

We, as the Internal Control over Financial Reporting (“ICFR”) Officer and Chief Executive Officer (“CEO”) of LG Display (“the Company”), assessed the effectiveness of the design and operation of the Company’s ICFR as of December 31, 2023.

The Company’s management, including myself, is responsible for designing and operating an ICFR.

We assessed the design and operational effectiveness of the ICFR in the prevention and detection of an error or fraud which may cause a misstatement in the preparation and disclosure of reliable separate financial statements.

We used the ‘Conceptual Framework for Designing and Operating Internal Control over Financial Reporting’ established by the Operating Committee of Internal Control over Financial Reporting in Korea (the “ICFR Committee”) as the criteria for design and operation of the Company’s ICFR. And, we conducted an evaluation of ICFR based on the ‘Management Guideline for Evaluating and Reporting Effectiveness of Internal Control over Financial Reporting’ established by the ICFR Committee.

Based on our assessment, we concluded that the Company’s ICFR is effectively designed and operated as of December 31, 2023, in all material respects, in accordance with the ‘Conceptual Framework for Designing and Operating Internal Control over Financial Reporting.

We certify that this report does not contain any untrue statement of a fact, or omit to state a fact necessary to be presented herein. We also certify that this report does not contain or present any statements which might cause material misunderstandings of the readers, and we have reviewed and verified this report with sufficient care.

January 24, 2024

Ho Young Jeong

Chief Executive Officer

Sung Hyun Kim

Internal Control over Financial Reporting Officer

106

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.



						LG Display Co., Ltd.
						(Registrant)

Date: Mar 8, 2024						By: /s/ Suk Heo
						(Signature)

						Name: Suk Heo
						Title: Director/Head of IR Division

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