ACC - Annual Report 2019 | FinancialReports.eu

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Stock Code: 1102 http://www.acc.com.tw http://emops.twse.com.tw

ASIA CEMENT CORPORATION 2019 Annual Report

Notice to readers

This English version annual report is a summary translation of the Chinese version and is not an official document of the shareholders’ meeting. If there is any discrepancy between the English version and Chinese version, the Chinese version shall prevail.

Printed on March 31, 2020

Spokesperson

Name: W.K. Chou Title: Vice President Tel: 886-2-27378940 E-mail: [email protected]

Headquarter and Plants

Headquarter

Address: 30~ 31F, No.207, Sec. 2, Dunhua South Rd., Da’an Dist., Taipei City 106, Taiwan Tel: 886-2-27338000

IR Contact & Deputy Spokesperson

Name: Doris Wu Title: Executive Vice President Tel: 886-2-27378945 E-mail: [email protected]

Hsinchu Plant

Address: No.109, Sec. 2, Zhongfeng Rd., Hengshan Township, Hsinchu County 312, Taiwan Tel: 886-3-5931011

Stock Transfer Agent

Oriental Securities Corporation Hualien Plant Address: 13F., No. 16, Xinzhan Rd., Banqiao Dist., New Taipei City 220, Taiwan Tel: 886-2-77531699 Website: http://www.osc.com.tw/

Address: No.125, Xinxing Rd., Xincheng Township, Hualien County 971, Taiwan Tel: 886-3-8612101

Auditors

Deloitte & Touche Auditors: Xin Wei Tai and Yu Wei Fan Address: 20F., No. 100, Songren Rd., Xinyi Dist., Taipei City 110, Taiwan Tel: 886-2-27259988 Website: http://www.deloitte.com/

Overseas Securities Exchange

London Stock Exchange

Disclosed information can be found at http://www.londonstockexchange.com/ Singapore Exchange Disclosed information can be found at http://www.sgx.com/

Corporate Website

http://www.acc.com.tw/

I REPORT TO SHAREHOLDERS ............................................................................................................................ 1 II COMPANY PROFILE ........................................................................................................................................... 10 2.1 DATE OF INCORPORATION: ........................................................................................................................................ 10 2.2 COMPANY HISTORY ................................................................................................................................................. 10 III CORPORATE GOVERNANCE REPORT ........................................................................................................ 14 3.1 ORGANIZATION ....................................................................................................................................................... 14 3.1.1 Organization Chart ..................................................................................................................................... 14 3.1.2 Major Corporate Functions ........................................................................................................................ 15 3.2 DIRECTORS, SUPERVISORS AND MANAGEMENT TEAM .................................................................................................... 17 3.2.1 Directors and Supervisors........................................................................................................................... 17 3.2.2 Major Shareholders of the Institutional Shareholders ............................................................................... 20 3.2.3 Major Shareholders of the Major Shareholders That Are Juridical Persons ............................................... 21 3.2.4 Professional Qualifications and Independence Analysis of Directors ......................................................... 26 3.2.5 Management Team .................................................................................................................................... 28 3.2.6 Remuneration of Directors, Supervisors, President, and Vice Presidents ................................................... 30 3.2.7 Employees Remuneration to Management Team ..................................................................................... 35 3.2.8 Name and Title of the Top 10 Employees Who Were Distributed Employees Remuneration .................... 35 3.3 IMPLEMENTATION OF CORPORATE GOVERNANCE .......................................................................................................... 36 3.3.1 Board of Directors ...................................................................................................................................... 36 3.3.2 Other mentionable items: .......................................................................................................................... 37 3.3.3 Annual priorities of Audit committee ......................................................................................................... 37 3.3.4 Attendance of Audit committee ................................................................................................................. 38 3.3.5 Corporate Governance Execution Status and Deviations from “Corporate Governance Best-Practice Principles for TWSE/ TPEx Listed Companies” ............................................................................................ 43 3.3.6 The Composition, Duty, and Implementation Status of the Remuneration Committee ............................. 55 3.3.7 Corporate Social Responsibility .................................................................................................................. 58 3.3.8 Implementation Status of Ethical Management ........................................................................................ 63 3.3.9 The Training for Directors ........................................................................................................................... 70 3.3.10 The Training for Managers ....................................................................................................................... 71 3.3.11 The Execution Status of Internal Control System ..................................................................................... 72 3.3.12 Major Resolutions of Shareholders’ Meeting and Board Meetings ......................................................... 73 3.3.13 Resignation or dismissal of the chairman, president, accounting manager, finance manager, auditing manager, and R&D manager of the Company ........................................................................................... 74 3.4 INFORMATION OF CPA SERVICE FEE ........................................................................................................................... 75 3.5 RELEVANT LICENSES AND CERTIFICATES OBTAINED ABOUT TRANSPARENT FINANCIAL INFORMATION ........................................... 76 3.6 CHANGES IN SHAREHOLDINGS AND PLEDGE OF DIRECTORS, SUPERVISORS, MANAGERS, AND SHAREHOLDERS WITH MORE THAN 10% SHAREHOLDING ...................................................................................................................................................... 77 3.7 INFORMATION DISCLOSING THE RELATIONSHIP BETWEEN ANY OF THE COMPANY’S TOP 10 SHAREHOLDERS ............................. 79 3.8 SHAREHOLDING PROPORTION OF ACC TO INVESTEES ..................................................................................................... 85 IV CAPITAL FORMATION ..................................................................................................................................... 86 4.1 CAPITAL AND SHARES............................................................................................................................................... 86 4.1 CAPITAL AND SHARES............................................................................................................................................... 86 4.1.1 Capital Increase in the Past Five Years ....................................................................................................... 86 4.1.2 Capital ........................................................................................................................................................ 86 4.1.3 Shelf Registration ： None .......................................................................................................................... 86 4.1.4 Shareholder Structure ................................................................................................................................ 86 4.1.5 Shareholding Distribution Status ............................................................................................................... 87 4.1.6 List of Major Shareholders ......................................................................................................................... 87 4.1.7 Market Price, Net Value, Earnings and Dividends per Share ...................................................................... 88 4.1.8 Dividend Policy & Implementation Status .................................................................................................. 88 4.1.9 Effects on Business Performance and EPS Resulting From Stock Dividend Distribution ............................. 89 4.1.10 Employees’ Compensation and Directors’ and Supervisors’ Remuneration ............................................. 89

4.2 SUMMARY OF CORPORATE BONDS ............................................................................................................................. 91 4.2.1 Issued Corporate Bonds ............................................................................................................................. 91 4.2.2 Issued Exchangeable Bonds and Convertible Bonds ................................................................................... 95 4.3 SUMMARY OF ISSUED GDR ...................................................................................................................................... 96 4.4 STATUS ON EXECUTION OF CAPITAL UTILIZATION PLANS ................................................................................................. 96 V OVERVIEW OF BUSINESS OPERATION ........................................................................................................ 97 5.1 BUSINESS INTRODUCTION ......................................................................................................................................... 97 5.1.1 Business Scope ........................................................................................................................................... 97 5.1.2 Industry Overview ...................................................................................................................................... 97 5.1.3 Technology and Research Development .................................................................................................... 99 5.1.4 Short-term Business Plan ........................................................................................................................... 99 5.1.5 Long-term Business Plan .......................................................................................................................... 100 5.2 GENERAL INFORMATION OF MARKET & PRODUCTION .................................................................................................. 100 5.2.1. Markets Analysis ..................................................................................................................................... 100 5.2.2 Application of Major Cement Products .................................................................................................... 101 5.2.3 Supply Condition of Main Raw Materials ................................................................................................. 102 5.2.4 Major Suppliers Information for the Last Two Years ............................................................................... 103 5.2.5 Major Clients Information for the Last Two Years .................................................................................... 103 5.2.6 Output of Main Products 2018-2019 ....................................................................................................... 104 5.2.7 Sales of Main Products 2018-2019 .......................................................................................................... 104 4.4 HUMAN RESOURCES ............................................................................................................................................. 105 5.4 EXPENDITURES ON ENVIRONMENTAL PROTECTION ....................................................................................................... 105 5.4.1 ISO-14001 Environmental Management Systems (EMS) ......................................................................... 106 5.4.2 Air Pollution Prevention ........................................................................................................................... 106 5.4.3 Greening and Beautification for Quarry Restoration ............................................................................... 107 5.4.4 Major Environmental Protection Work in the Future ............................................................................... 107 5.4.5 Fulfill Social Responsibilities ..................................................................................................................... 107 5.5 LABOR RELATIONS ................................................................................................................................................. 108 5.6 MAJOR CONTRACTS .............................................................................................................................................. 112 VI FINANCIAL INFORMATION .......................................................................................................................... 113 6.1FINANCIAL REPORTS & AUDIT RESULTS IN RECENT FIVE YEARS ........................................................................................ 113 6.1.1 Consolidated Balance Sheets ................................................................................................................... 113 6.2 FINANCIAL ANALYSIS .............................................................................................................................................. 117 6.2.1 Consolidated Financial Statements .......................................................................................................... 117 6.2.2 Separate Financial Statements................................................................................................................. 118 6.3 AUDIT COMMITTEE’S REVIEW REPORT ON THE 2019 FINANCIAL STATEMENTS .................................................................. 120 6.4 FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS’ REPORT .................................................................................... 121 VII ANALYSIS OF FINANCIAL STATUS, OPERATING RESULT, AND RISK MANAGEMENT .............. 143 7.1 ANALYSIS OF FINANCIAL STATUS .............................................................................................................................. 143 7.2 ANALYSIS OF FINANCIAL PERFORMANCE .................................................................................................................... 144 7.3 ANALYSIS OF CASH FLOW ........................................................................................................................................ 145 7.4 IMPACTS OF MAJOR CAPITAL EXPENDITURES ON FINANCE AND OPERATION ...................................................................... 145 7.5 INVESTMENT STRATEGIES IN THE MOST RECENT YEAR, THE MAJOR REASONS FOR ITS GAIN OR LOSS AND IMPROVEMENT PLAN AND INVESTMENT PLANS FOR NEXT YEAR......................................................................................................................... 146 7.6 ANALYSIS AND EVALUATION OF RISK MANAGEMENT..................................................................................................... 146 7.6.1 The Impact of Fluctuation of Foreign Exchange, Interest Rates, and Inflation on the Company’s Profit and Loss and Its Countermeasures .................................................................................................................. 146 7.6.2 The Impact of Highly Risky Investments, Highly Leveraged Transaction, Loaning to Others, Endorsement and Guarantee for Others, and Derivatives ............................................................................................. 148 7.6.3 The Prevention of Legal Risks ................................................................................................................... 148 7.7 OTHER MENTIONABLE ISSUES .................................................................................................................................. 149 VIII SPECIAL DISCLOSURE ............................................................................................................................... 150 8.1 ORGANIZATIONAL CHART OF AFFILIATED COMPANIES ................................................................................................... 150 8.2 BASIC INFORMATION OF AFFILIATED COMPANIES ......................................................................................................... 151

8.3 MAIN BUSINESS OF AFFILIATED COMPANIES............................................................................................................... 154 8.4 INFORMATION OF THE DIRECTORS, SUPERVISORS, AND PRESIDENTS OF AFFILIATED COMPANIES ............................................ 155 8.5 OPERATING CONDITION OF AFFILIATED COMPANIES ..................................................................................................... 167

III

I Report to Shareholders

2019 Business Report

1. Review of the Year 2019

Review of the international economic situation in 2019

Looking back at the international economic situation in 2019, we found that, influenced by the unending trade disputes between the United States and China, rising geopolitical risks, and weak economic performance in emerging markets, the global economic growth momentum weakened, and international raw material prices generally slowed down. Meanwhile, the high comparative base period data has led to weak foreign trade data for major countries, conservative investment and operations by manufacturers and under-performance by the manufacturing sector in 2019. In Europe, uncertainty has risen because of the Brexit deadline and the ECB's halt to quantitative easing.

Observing the performance of major economies, it was found that China's economic growth slowed in 2019, mainly due to the U.S.-China trade conflict, government regulation of non-bank financial institutions to curb debt risk, and slowing labor force growth. Annual economic growth was 6.1%, 0.6% less than in 2018. In the United States, economic growth is slowing due to the diminishing effect of fiscal stimulus and the uncertainty of a trade war between the United States and China. In the Eurozone, however, the negative effects of export demand and supply interacted with each other, resulting in an annual decrease of 1.7% in industrial production, especially in Germany and Italy. Japan is one of the few countries with relatively significant economic growth, mainly due to slightly more vibrant private consumption and the government's expansion of fiscal spending, which offset the adverse impact of the consumption tax hike.

Review of the domestic economic situation in 2019

In 2019, the momentum of global economic growth was markedly weakened by the ongoing U.S.-China trade standoff and weak overseas demand. However, Taiwan has benefited from factors such as trade diversion effect, reinvestment by Taiwanese businessmen, and expansion of investment in semiconductor equipment, leading to growth in domestic demand, which has brought back consumption and increased investment.

As far as consumption is concerned, sales of automobiles and automobiles and other consumer goods increased. The turnover of the retail and catering industries hit new highs repeatedly, and the momentum of domestic demand grew. However, the wholesale industry was affected by trade frictions, so the demand slowed down and the sales force was reduced. Regarding investment, more investment in equipment from companies and the recent expansion of advanced manufacturing capacity in the semiconductor industry have helped lift economic growth. As for prices, Taiwan's consumer price index (CPI) rose by 0.56% in 2019, the lowest rate in nearly four years, due to continued weak prices in the international commodity market. Overall prices are moderate and stable. The wholesale price index (WPI) fell by 2.24% in 2019, mainly due to the falling prices of chemical materials and base metals.

According to Statistics from the Directorate-General of Budget, Accounting and Statistics under the Executive Yuan, the annual economic growth rate in 2019 was 2.71%, showing an increase of 0.08% compared with that in 2018.

The Company's business performance in 2019

A. In 2019, the overall cement consumption in China amounted to about 2.33 billion MT, increasing 6.1% compared with 2018. In the same period, the clinker production volume of the Company in China is 24.84 million MT, increasing 0.17% compared with 2018. The total sales of cement, clinker and slag powder are 30.83 million MT, decreasing 0.39% compared with 2018.

In 2019, the net income of Asia Cement (China) Holdings Corp. is NT$ 14,106,889 thousand. The Company and its subsidiaries recognized a total investment profit of NT$ 10,156,960 thousand.

B. For domestic cement industry, according to a statistics conducted by the Taiwan Cement Manufacturers’ Association, the 2019 total cement production volume in Taiwan was 11,267,211 MT, increasing 3.00% compared with 2018. Among them, the domestic cement sales was 9,054,712 MT, and exported cement was 2,321,014 MT. Compared with those in 2018, domestic sales increased by 5.60%, exports decreased by 2.43%.

The total sales of cement in Taiwan of the Company was 2,564,176 MT which is equivalent to 28.32% of the total production volume in Taiwan, or 22.59% of the overall cement consumption in Taiwan. In 2019, the domestic real estate economy was stable, showing a slight increase in volume and stable in price compared with 2018. The cement consumption increased to 11,350,017 MT, by 6.53%. The 2019 per capita average cement consumption is about 482 kg, increased 10.80% from 435kg in 2018. The overall market is showing steady growth.

C. The 2019 consolidated operating revenue of the Company is NT $89,347,637 thousand, increased 7.98% from 2018. The consolidated profit from operations was NT $22,063,176 thousand, increased 21.54% from 2018. From China Shanshui Cement, Far Eastern New Century Corp., and U-Ming Marine Transport Corp., the Company recognized NT $5,490,375 thousand investment income from equity method. The consolidated net profit after tax reached NT $22,243,953 thousand. The net profit rate after tax was 24.90%. Consolidated net profit attributable to the Company is $17,459,673 thousand. The 12[th] meeting of the 26[th] Board of Directors proposed to distribute cash dividend NT $3.0 per share.

2. Operating Performance of 2019

A. Production:

					Unit: 1000 MT	Unit: 1000 MT
Item Region	Cement	Difference Compared to 2018	%	Clinker	Difference Compared to 2018	%
ACC (Taiwan)	3,536	76	2.20	3,386	69	2.08

＊ key performance indicator:

Actual aggregate cement output amounted to 3,536 thousand MT. Compared to estimated output 3,630 thousand MT, the achievement rate is 97.41%.

Actual aggregate clinker output amounted to 3,386 thousand MT. Compared to estimated output 3,549 thousand MT, the achievement rate is 95.41%.

Unit: 1000 MT

Item Region	Cement	Difference Compared to 2018	%	Clinker	Difference Compared to 2018	%
ACC (China)	28,747	(296)	(1.02)	24,843	42	0.17

＊ key performance indicator:

Actual aggregate cement output amounted to 28,747 thousand MT. Compared to estimated output 28,624 thousand MT, the achievement rate is 100.43%.

Actual aggregate clinker output amounted to 24,843 thousand MT. Compared to estimated output 24,170 thousand MT, the achievement rate is 102.78%.

B. Sales

i. Taiwan area:

Unit: 1000 MT; NT$1,000

B. Sales i. Taiwan area:					Unit: 1000 MT; NT$1,000	Unit: 1000 MT; NT$1,000	Unit: 1000 MT; NT$1,000	Unit: 1000 MT; NT$1,000
Volume & Value Product	2019				Difference Compared to 2018
	Domestic Sales		Export Sales
	Volume	Value	Volume	Value	Volume	%	Value	%
Cement & Clinker	2,608	5,792,210	1,039	1,835,779	135	3.84	391,991	5.42

＊ Key Performance Indicator:

Actual aggregate sales of cement and clinker produced by ACC amounted to 3,647 thousand MT. Compared to the estimated sales 3,800 thousand MT, the achievement rate is 95.97%.

ii. China area:

Unit: 1000 MT; NT$1,000

Volume & Value Product	2019	2019	2019	2019	Difference Compared to 2018	Difference Compared to 2018	Difference Compared to 2018	Difference Compared to 2018
	Domestic Sales		Export Sales
	Volume	Value	Volume	Value	Volume	%	Value	%
Cement & Clinker	30,781	49,729,598	57	64,312	(57)	(0.18)	2,748,606	5.84

＊ Key Performance Indicator:

Actual aggregate sales of cement and clinker produced by ACC (China) amounted to 30,838 thousand MT. Compared to the estimated sales 29,881 thousand MT, the achievement rate is 103.20%.

3. The Company’s Layout Strategy in China

Asia Cement Corporation pioneered all domestic rivals to invest in cement business in China with Taiwan government’s permission since 1997.

On May 20, 2008, the subsidiary of the Company, Asia Cement (China) Holdings

Corporation {ACC (China) thereafter} was listed on the main board of Hong Kong Exchanges and Clearing Limited. Total assets reach RMB 24 billion.

Currently, the investments of ACC (China) are mainly based alone the Yangtze River in Jiangxi, Sichuan, Hubei, Yangzhou and Shanghai areas. The overall operating strategies are deployed through Jiangxi Yadong Cement (Southeast China), Sichuan Yadong Cement (Southwest China), Hubei Yadong Cement (Middle China), and Yangzhou Yadong Cement (East China) as core production bases. In addition to Sichuan Lanfeng Cement Corp., Huanggang Yadong Cement, and Wuhan Yaxin Cement, there are two grinding factories, five cement products companies, three transportation companies, Wuhan Asia Shipping Co., Ltd (joint-venture), Hubei Xinlongyuan Building Material Company(joint-venture), Hubei Zhongjian Yadong Concrete Company(joint-venture), Tai Zhou Oriental Construction Co., Ltd., Ruichang Yadong New Material Company, three terminals, and twelve sale offices. These constitute an efficient and solid network for production, transportation and sales.

4. Overview of The Company’s Investments in China

A. Jiangxi Yadong Cement Co., Ltd

The company originally has six kilns with annual output of clinker 11 million MT of clinker, which can produce 14 million MT cement. Jiangxi Yadong has become one of the largest cement plants in China. The waste heat recycling generators can produce 338 million kWh electricity annually. This substantially reduces electricity costs and minimizes the dependence on external power supply.

B. Sichuan Yadong Cement Co., Ltd

The company has three kilns with annual output of clinker 4.95 million MT which can produce 6 million MT cement. In addition, the waste heat recycling generators can produce 145 million kWh electricity annually. This substantially reduces electricity costs and minimizes the dependence on external power supply.

The conveyor belt transporting the limestone from quarry directly to the plant enhance the transportation efficiency and lower raw-material cost and also completely prevent interfering with surrounding environments, roads, and living of residents.

C. Hubei Yadong Cement Co., Ltd

The company has two kilns with annual output of clinker 3.3 million MT which can produce 4 million MT cement. In addition, the waste heat recycling generators can produce 105 million kWh electricity annually. This substantially reduces electricity costs and minimizes the dependence on external power supply.

D. Huanggang Yadong Cement Co., Ltd

The company has one kiln. The annual output of clinker amounts to 1.65 million MT which can produce 2 million MT cement.

E. Wuhan Yaxin Cement Co., Ltd

To enhance the market position and market share of the “Skyscraper” cement in Wuhan areas, Hubei Yadong Cement Co., Ltd acquired Wuhan Xinlingyun Engineering Co., Ltd on July 2010. The annual output of cement amounts to 1.5 million MT.

F. Sichuan Lanfeng Cement Corp.

To enhance the market position and market share in Chengdu area, Sichuan Yadong Cement Co., Ltd in 2014 acquired 100% shares of Sichuan Lanfeng Cement Corp. Lanfeng located in Pengzhou City, Sichuan, China which owns two new dry process clinker production

lines with total annual cement production capacity of 5 million MT. The waste heat recycling generators can produce 130 million kWh electricity annually.

G. Yangzhou Yadong Cement Co., Ltd

The grinding factory can produce 3 million MT cement annually to supply the market in Yangzhou area. Besides, the mixer station can produce ready-mixed concrete for the market.

H. Wuhan Yadong Cement Co., Ltd

The company can produce 1.7 million MT cement and 0.6 million MT slag powder annually to supply the market in Wuhan area.

I. Nanchang Yadong Cement Co., Ltd

The company can produce 0.6 million MT slag powder and 1.2 million MT slag cement annually to supply the market in Nanchang area.

5. Prospects for the Economic Situations in 2020

A. Prospects for the international economic situation in 2020

Previously, the international economic outlook for 2020 was relatively flat, where the global economic outlook was fragile and unable to recover substantially. The novel coronavirus (COVID-19) epidemic in the beginning of the year had a significant impact on economic activities such as global production, consumption and trade. The momentum of global economic growth has slowed down even more, especially in the United States, which accounts for as much as one-third of global private consumption. The epidemic and epidemic control have dealt a double blow to both the supply and demand sides of the global economy. The global economic outlook is in jeopardy, and the market atmosphere has deteriorated sharply, resulting in significant volatility in international financial markets. Moreover, according to simulations of the International Labor Organization (ILO) in March 2020, it is known that even in the scenario with the smallest impact of the epidemic, the number of global unemployment would increase by 5.3 million, and at the peak of the impact, it would increase to 24.7 million, surpassing the number of global unemployment rate of 22 million during the financial crisis in 2008. The International Monetary Fund (IMF) released the latest World Economic Outlook on April 14, 2020, which predicts that global GDP will shrink by 3% in 2020 and will experience the worst economic recession since the Great Depression of 1930. Although global GDP is expected to rise to 5.8% next year, the international economic outlook will be affected by the follow-up development of trade disputes between the US and China, a faster-than-expected economic slowdown in China, the trend of international oil prices, financial market volatility, the US presidential election and the future economic and trade relations between the UK and the EU.

B. Prospects for the domestic economic situation in 2020

The novel coronavirus (covid-19) outbreak in 2020 has affected global economic growth, and Taiwan's domestic and external demand performance was also greatly affected. Taiwan's economic situation was originally weakened by a prolonged standoff in the trade dispute between China and the United States and weak overseas demand. However, at the same time, Taiwan also benefited from the trade diversion effect, repatriation of investment by Taiwan’s merchants and expansion of investment in semiconductor equipment, which boosted domestic demand growth.

The economic situation evaluated by Academia Sinica is "cold outside and warm inside," with an economic growth rate of 2.58%. However, after the outbreak of COVID-19, although the export is facilitated by the reflow and expansion of production capacity of Taiwanese

merchants and the development of 5G, artificial intelligence and the Internet of things and other emerging applications, the expansion might be affected. The momentum of private investment in green energy such as semiconductors and offshore wind power continues. In addition, private investment is expected to continue to grow steadily as Taiwanese merchants return to Taiwan. Due to the impact of the epidemic, the growth of private consumption has slowed down significantly. Domestic tourism, catering and other outdoor activities have declined sharply. In addition, some enterprises closed their businesses or reduced their shifts, resulting in the loss of employees' income and the reduction of consumption expenditure. Fortunately, with the booming development of e-commerce and delivery platforms, the overall impact has been somewhat reduced. According to the latest assessment released by the Asian Development Bank in April 2020, Taiwan’s economic growth rate is revised to 1.8% this year. Although it is revised down, it still performs relatively well among the four Asian dragons. Meanwhile, the forecast of the Chung-hua Institution for Economic Research at the same time is relatively optimistic, with the GDP growth rate of 1.03% in 2020, which is 1.68% lower than 2.71% in 2019. According to the Central Bank, the future uncertainties include the future development of COVID-19, the implementation of the China-U.S. trade agreements and the follow-up negotiations, international stock, foreign exchange and bond market fluctuations, the price trend of oil and other raw materials, and the impact of geopolitical situation on the global economy.

6. Prospects for the cement industry on both sides across the Taiwan Straits

A. Cement industry in China

In 2020, affected by covid-19, China suffered a 6.8% economic recession in Q1. However, China has put forward the "six guarantees"[1] policy and launched economic stimulus measures, and it is estimated that the annual economic growth will be between 2% and 3%. Compared with 2.33 billion MT in 2019, the cement demand is still expected to be in the range of 2.2 to 2.3 billion MT this year.

The coal market is expected to see a small price decline in 2020 as supply is eased; oil prices will remain low as demand for oil declines due to the widening of the global epidemic.

The operating outlook of the cement industry in China is as follows.

a. COVID-19 epidemic has a far-reaching impact: The new trading mode will transform the existing pattern, and the networked, mobile and intelligent sales mode will become the new development direction. With a serious epidemic overseas and economic turmoil, investment, import and export will be curbed, and the pace of investment by Chinese enterprises overseas will slow down. Cement kilns are actively engaged in the coordinated disposal of medical waste, which will become a new growth point after the epidemic.
b. The trend of continued tightening of supply in the sector remains unchanged:
- i. Capacity replacement[2] is more stringent:
- Capacity replacement activities will be strictly regulated, and companies will be prohibited from building new capacity or building more capacity than previously
1 "Six guarantees" refer to ensuring employment of residents, basic livelihood, market players, food and energy security, industrial and supply chain stability, and community-level operation.
2 "Capacity replacement" means the elimination of backward production capacity and the realization of industrial upgrading by means of marketization, so as to control the industrial capacity.

approved by the government. In 2020, some provinces and regions will directly stop the production capacity replacement of cement enterprises in any form.

ii. Improvement to the Staggered Peak Production policy:

The Staggered Peak Production policy continues to be refined and perfected, and the overall coverage is more extensive. By setting exemption thresholds for environmental protection emissions and safe production, the conditions for exemption from Staggered Peak Production[3] will be more stringent, and the balance between supply and demand of cement will be more stable.

c. Economic Recovery: Infrastructure is the top priority, while the demand for cement shall be stabilized:
i. In order to reduce the impact of the COVID-19 epidemic on the economy, China's fiscal policy will be active in 2020, and the scale of the annual special bond issue will exceed RMB 4 trillion, with a new special bond amount of RMB 350 billion mainly deployed among new infrastructure projects concerning the 5G network, ultra-high voltage, intercity high-speed rail and intercity rail transportation, etc. to effectively stabilize cement demand.
ii. China is actively promoting regional strategies and city cluster construction in China, including transportation construction, Yangtze River Delta integration and the establishment of The Guangdong-Hong Kong-Macau Greater Bay Area and Xiongan New Area. At the same time, China has further expanded its inland liberalization efforts with the establishment of the Jiangxi Inland Open Economic Experimental Zone, bringing incremental demand for cement in the region.
d. Coordination among enterprises for increased concentration: During the epidemic, the coordination, linkage and joint anti-risk capabilities of large enterprises have become prominent, and the advantages of market coordination have gradually emerged. In response to the new changes in the post-epidemic era, large cement groups will initiate a new round of industry mergers and acquisitions in the future to centralize their resource advantages and take the initiative to grasp the market.
e. The era of smart factory is approaching: In 2019, in the cement industry, there are intelligent cement production lines with intelligent production as the core, where operation and maintenance can provide protection and intelligent management can promote operation.

As a result, the cement industry has achieved the results of factory operation automation, management visualization, fault pre-control, all-factor coordination and decision-making intelligence, leading the industry to a new direction of development, and it has become a trend for the industry as a whole to use new technology to upgrade smart factories.

f. The e-commerce platform and green logistics have become the standard: We will create and explore new paths for the development of production and marketing, closely connect with each other electronically, develop online e-commerce platforms, and use big data to form a close and efficient Internet development system. The stringent ban on overloading and more stringent environmental requirements for water and land transport have placed higher demands on industry transport. The automated and customized self-owned e-commerce platform and the green logistics system will become the new standard of the industry.
3 "Exemption from Staggered Peak Production" means refers to the situation where cement companies that meet certain specific conditions to be exempt from performing staggered peak production.

g. Extending the industrial chain with resource advantages: Under the normal environmental protection control, resource development pays more attention to ecological protection and promotes the construction of green mines. Restrictions on river sand mining and sand and gravel shortages will prompt the sand and gravel industry to accelerate its transformation and upgrading. Cement giants have been investing in the sand and gravel aggregates industry to speed up the integration of resources, which will become a new profit growth point for the industry in the future.

B. Cement industry in Taiwan

In 2020, the novel coronavirus (COVID-19) epidemic spread from Asia to other parts of the world, and the international oil price collapsed at the beginning of the year, which made the global financial market volatile and Taiwan's economic growth performance facing severe challenges. In order to revive the domestic market, the government will accelerate the implementation of various public construction projects and tenders to expand domestic demand, and set a target of 95% success rate for this year's public construction projects. In addition, the total budget for 2020 includes $164.6 billion for public works projects, $100.5 billion as the special budget for forward-looking infrastructure projects, and $201.9 billion for operating and non-operating special funds, which is $467 billion in total, showing an increase of $81.8 billion or 21.3% compared to that in 2019.

In terms of real estate, the Ministry of the Interior announced that the number of Taiwan's total number of traded and transferred buildings in 2019 was 302,275, showing an annual increase of 8%. It was the first time in five years that the number reached 300,000, and the third consecutive year since its expansion and growth in 2017. The fundamentals of the housing market in 2020 remain solidly structured in terms of demand for owner-occupied housing, but the impact of the novel coronavirus (COVID-19) epidemic will cast a variable on the growth of the housing market.

Overall, due to the impact of COVID-19, the economic situation in 2020 is full of uncertainty. However, driven by the government's accelerated implementation of public works, the total demand for cement in Taiwan is still expected to be the same as last year.

7. Business Outlook of the Company in 2020

In 2020, Taiwan's cement industry is still in an environment of oversupply and fierce competition. Regarding novel coronavirus (COVID-19) outbreaks, the Taiwanese government has been well advised to prevent them, and its epidemic control effect is world-renowned as all people follow the government's instructions. Therefore, the impact of the epidemic on the cement industry is relatively limited. It is expected that the company's performance this year will be like that of last year, and it will still be in a state of surplus.

As for China, owing the impact of the novel coronavirus (COVID-19) epidemic, the country's policy of extensive city closures has led to widespread work stoppages, which has led to a setback for Asia Cement (China)'s operations in the first four months of the year. But after May, the cement market in China entered its peak period in the first half of the year. In addition, stocks of cement companies in most regions have fallen to moderate or low levels due to the concentrated release of backlogged demand from the epidemic, which has caused cement prices to start rising. It can be expected that the overall profitability of Asia Cement (China) will stabilize quarter-on-quarter and is expected to continue to maintain the high prices of cement and profitability levels in 2019 as the market fully returns to normal.

Regardless of the business environment, we will do our best to stick to the established production and marketing strategy and consistently adhere to the policy of "high quality, high efficiency, high environmental protection and low cost."

In 2020, total domestic clinker production is expected to be 3,572 thousand MT, total cement production is expected to be 3,576 thousand MT and sales of self-produced cement and clinker are expected to be 3,822 thousand metric tons. In China, the production of clinker and cement is expected to reach 24,684 MT and 28,748 MT, with 30,100 MT of self-produced cement and clinker as the sales volume.

8. The Company's Operating Status in the First Quarter of 2020

For the first quarter of 2020, the Company's consolidated operating income was $13,138,882 thousand, which was 32% less than $19,385,675 thousand for the same period in 2019. The consolidated net income after tax was $1,130,599 thousand, which was 70% less than $3,810,086 thousand in the same period in 2019. The net after-tax profit attributable to the owner of the Company was $743,772 thousand.

II Company Profile

2.1 Date of Incorporation: March 21, 1957.

Paid-in Capital: NT$ 33,614,471,980.

Scope of Business:

C901030 Cement manufacturing
C901040 Ready-mixed concrete manufacturing
B601010 Quarrying
C901050 Cement and ready-mixed concrete products
C901990 Non-metallic mineral products
F111090 Whole sale of building materials
F211010 Retail sale of building materials
F401010 International trade
IZ06010 Tally and packing
A201010 Afforestation business
H701010 Developing, leasing, and selling residential and business buildings
H701020 Developing, leasing, and selling industrial factories
H703100 Real estate rental & leasing
H703090 Real estate sale & purchase
JE01010 Rental and leasing
G202010 Parking-lot business
G801010 Warehousing
I103060 Business management consultation services
J101040 Waste treatment

In addition to permitted scope of business, the Company can broaden its business not prohibited or restricted by laws.

2.2 Company History

Responding to the Taiwan government’s second four-year economic development plan, Asia Cement Corporation (ACC) was founded on March 21, 1957 by Mr. Y.Z. Hsu and others. It built its first manufacturing plant in Hengshan Township, Hsinchu County. In 1973, in response to the government’s call to develop eastern Taiwan, the Company established its second plant in Hsincheng Township, Hualien County. Asia Cement and its “Skyscraper” brand cement have always occupied the core position in Taiwan’s cement business. For now, these two plants can produce 5 million MT of clinker annually.

Asia Cement uses the most modern rotary kilns and introduces waste-heat recycling generators to transform waste heat and hot air into electricity. In addition, for lower cement transportation costs, Asia Cement established storage and transportation facilities in the Keelung, Taichung, Kaohsiung, and Hualien harbor. It also invested in the Group’s U-Ming Marine Transport Co., Ltd., and began using U-Ming’s bulk carriers to transport cement around Taiwan. The Company’s “Three Highs and One Low” strategy, high quality, high efficiency, high environmental protection, and low cost, along with its management capability, have given the Company the competitive edge to efficiently face challenges in the market.

Asia Cement believes that economic growth and environmental protection can be achieved in parallel. Asia Cement introduces the most advanced dust collection equipment to effectively control the dust fall, keeping it far below the national standard. We are also dedicated to making our plant areas like a park especially with the Hualien plant spending tremendous manpower and

resources to establish the greenhouse seedling system for cultivation of all kinds of indigenous plants and transplantation in the remaining walls of the mined areas of the quarry, which has brought excellent greening results acclaimed by various awards. In addition to being among the first receivers of ISO-14001 environmental management system certification, the Company has won the Enterprise Environmental Protection Award for 3 years. The Portland cement produced by the Hualien plant has also won international recognition this year by receiving the ISO-14067:2018 (Greenhouse Gases Carbon Footprints of Products), the ISO 14046: 2014 (Greenhouse Gases Water Footprints of Products), and the optimizing level of the BS 8001: 2017 for circular economy model maturity through SGS certification, making Asia Cement the first cement producer to receive the certification for circular economy standard, carbon footprint and water footprint at the same time in the world. In recent years, we have built a butterfly ecological park based on the existing beautified environment of the Hualien plant, luring thousands of visitors to experience the beauty of nature and receiving high recognition from the general public.

Besides establishing its core business, the Company also diversifies its investment by establishing Ya Tung Ready Mixed Concrete Co., Ltd. and Ya Li Precast & Prestressed Concrete Industries Ltd. Together with Far Eastern Construction Co., Ltd. and Far Eastern General Contractor Co., Inc., Asia Cement completed its vertical integration.

ACC’s diversification strategic layout for the world not only includes the complete production and sales channels in Taiwan, it also has representative offices in Hong Kong and Singapore. Furthermore, it is also expanding into the world market, exporting cement to Southeast Asia, North America, Africa, and the Middle East Asia. Meanwhile, Asia Cement began to invest in China from 1994. Currently, with the production and sale bases in Jiangxi, Sichuan, Hubei, Yangzhou, and Shanghai, the total cement production capacity in China reaches 36 million MT. Asia Cement (China) Holdings Corporation has listed on the Main Board of the Hong Kong Stock Exchange in 2008. Asia Cement (China) Holdings Corporation will continue expand capacity through strategy cooperation, or merger & acquisition.

In the future, Asia Cement will keep maintaining its deep roots in Taiwan and continue moving forward by expanding in China and worldwide.

Major events in recent 6 years are shown as the following table:

Major events	in recent 6 years are shown as the following table:
Year	Major Events
Feb. 2015	The Company received “Golden Vessel Awards” in honor of our contribution in environmentprotection,Taiwan International Ports Corporation.
Apr. 2015	The Company received A++ ranking award in the 12th“Information Transparency and Disclosure RankingSystem",Securities and Futures Institute.
May 2015	The Company was ranked top 5% in “the 1stCorporate Governance Evaluation” bythe TWSE.
June 2015	The Companyis listed in “TWSE Corporate Governance 100 Index”
Aug. 2015	The Company is ranked 39thin CommonWealth Magazine's Corporate Citizenship Awards.
Nov. 2015	The Hualien Plant was awarded “2015 Excellent Company for Voluntary Reduction of Greenhouse Gas Emissions” by the Industrial Development Bureau, MOEA.

Nov. 2015	The Company’s CSR Report was awarded “Top 50 Corporate Sustainability Report-Gold Award”,TCSA.
Jan. 2016	The Companyreceived 2015 GHG reduction award,EPA.
Apr. 2016	The Company was ranked top 6%~20% in “the 2ndCorporate Governance Evaluation” bythe TWSE.
Apr. 2016	Sichuan Yadong Cement Co., Ltd completed second conveyor belt transporting the limestone fromquarrydirectlyto theplant on April 2016.
Apr. 2016	Jiangxi Yadong Cement Co. was awarded the "Energy Management System Certification".
Jun. 2016	Huanggang Yadong Cement Co. was awarded the honorary certification of "Hubei Famous Brand".
Sep. 2016	Sichuan Lanfeng Cement Co. was awarded 2016 "Chengdu manufacturing top hundred" and "Chengduprivate enterprises tophundred".
Nov. 2016	The Hualien Plant was awarded “2016 Excellent Company for Voluntary Reduction of Greenhouse Gas Emissions” by the Industrial Development Bureau, MOEA.
Dec. 2016	Jiangxi Yadong was awarded the "3rdMayor Quality Award" certification, in recognition of the company's outstanding contribution to the quality of the city's construction.
Dec. 2016	The Hualien plant obtained ISO 50001: 2011 energy management system certification in which Hsinchenshan Mine is also the first quarry in Taiwan obtained this certification.
Mar. 2017	The Hsinchenshan mining right of the Hualien plant of the Company is allowed to extent for 20years to November 22,2037.
Mar. 2017	Ccement.com announced the 2016 top 10 ranking of cement and clinker production capacity in China. ACC (China) ranked the 10th and won a top ten trophy.
Apr. 2017	The Company was ranked top 6%~20% in “the 3rd Corporate Governance Evaluation” bythe TWSE.
Jun. 2017	The Hualien plant obtained ISO 14001:2015, the latest version of the environmental management system certification.
Jun. 2017	The Hualien plant obtained ISO 9001:2015, the latest version of the quality management system certification
Oct. 2017	Huanggang Yadong was awarded the “National Excellent Quality Unit for Cement Quality Inspection in 2017” by the National Cement Quality Supervision and Inspection Center.
Nov. 2017	The Hualien Plant was awarded “2017 Excellent Company for Voluntary Reduction of Greenhouse Gas Emissions” by the Industrial Development Bureau, MOEA.
Apr. 2018	Jiangxi Yadong was awarded “Advanced Unit for Safe Production Goal Management in 2017 in Jiujiang”.
Apr. 2018	The Company was ranked top 6%~20% in “the 4thCorporate Governance Evaluation” bythe TWSE.
May 2018	Huanggang Yadong participated in the First "China Green Mining Development Conference" and won the third-class technical certificate.

Jul. 2018	Sichuan Yadong Phase II and Phase III independent environmental protection acceptance project has been approved by the construction project environmental impact assessment informationplatform.
Sep. 2018	In order to benefit the long-term development and in response to rapid changes in China, Asia Cement (China) has adjusted human resource deployed in headquarters and each business area.
Nov. 2018	Huanggang Yadong passed four certifications including the new ISO management system (quality, environment, occupational health and safety, energy management).
Nov. 2018	The Hualien plant was awarded the "International Health and Safety Management System " award.
Mar. 2019	The first phase of elite training classes of Asia Cement (China) ended in Hubei Yadongwith 40 trainingsuccessors.
Apr. 2019	The Company was ranked top 6%~20% in “the 5thCorporate Governance Evaluation” bythe TWSE.
Apr. 2019	Jiangxi Yadong was awarded the annual advanced production safety management unit bythe RuichangCityGovernment.
May 2019	Jiangxi Yadong was awarded the medal of "Excellent Enterprise of 2018" in RuichangCity.
May 2019	The Company is the first in Taiwan to win the "Asia Responsible Enterprise Awards" for two consecutiveyears(2018-2019).
Jun. 2019	Sichuan Yadong was granted the "Road Portland Cement Production License" issued by State Administration for Market Regulation, and obtained the production qualification of special cement for airport runways.
Oct. 2019	Sichuan Yadong and Huanggang Yadong won the "National Excellence Award" in the 17th National Cement Quality Index Inspection Competition of the "Gezhouba Cement Cup" in 2019.
Dec. 2019	Hualien Plant won the 2018 Far Eastern Spirit Award.
Dec. 2019	Huanggang Yadong was selected as the "2019 Green Factory List in Hubei Province".
Jan.2020	Four mines of ACC (China) were selected by the Ministry of Natural Resources as 2019 Green Mines List.
Mar. 2020	The China Cement Association announced the ranking of the top 50 companies in the country's cement clinker production capacity in 2020, and Asia Cement (China)ranked 10th.
Apr. 2020	The Company is ranked top 20% of the 6th Corporate Governance Evaluation of listed companies.
May 2020	Hualien Plant obtained ISO 14067: 2018 product carbon footprint standard, ISO 14046: 2014 product water footprint standard, BS 8001: 2017 the highest maturity level of circular economy, and was the first cement plant to obtain 3 verifications at the same time.

During the most recent fiscal year and the current fiscal year up to the date of printing of the annual report, there are no important events listed below impacting on the shareholders’ equity of the Company: 1. Mergers and acquisitions. 2. To restructure affiliate companies. 3. Large volume shares transferred or changed by directors, supervisors, or major shareholders who own more than 10% shareholding. 4. Changes in the Company’s management. 5. Significant changes in business modes or business scope.

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III Corporate Governance Report
3.1 Organization
3.1.1 Organization Chart
Shareholders’
_____ Administration System
Meeting
…………….. Technology System
Audit Committee
Board of Directors
Remuneration
Committee
Chairman
President Office
Vice Chairman HR Dept.
CSR Committee
President
Credit Committee
General Plant
Chief Engineer Vice President Chief Auditor
Manager
Human Resource
Committee
IT Steering
Committee
Hualien Hsinchu Export Domestic Finance Secretarial Auditing
Plant Plant Dept. Sales Dept Sales Dept Dept. Dept. Dept. Dept.
-14-- 14 -
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3.1.2 Major Corporate Functions

Company Organization with Functions of Risk Management

Department	Primary Functions
Auditing	Directly report to the Board of Directors. Major duties: 1.Fair presentation of the
Dept.	financial reports, 2.The hiring (and dismissal), independence, and performance of
	CPA, 3.The effective implementation of the internal control system,
	4.Compliance with relevant laws and regulations, and 5.Management of the
	existing orpotential risks.
Remuneration	Directly report to the Board of Directors. Prescribe and periodically review the
Committee	performance andremunerationpolicyfordirectors andmanagerialofficers.
President	Assist ACC President to deal with daily affairs, plan operation strategies, and
Office	review the middle-term and long-term investment to reduce the risks resulting
	from improperdecisions.
HR Dept.	Plan and implement HR policies to reduce relevant risks. HR Department is also
	responsibleforpromoting ethical management ofthe Company.
CSR	Responsible for investigating and identifying corporate sustainability issues and
Committee	to respond major considerations of stakeholders in order to implement the goal of
	sustainable development.
Credit	Execute “Regulations for Managing Client’s Credit” enacted by the Company
Committee	and take charge of risk control of account receivable.
Human	Review and advice to modify the Company’s organization structure, rules of
Resource	personnel management, and other important human resource matters.
Committee
IT Steering	Review all affairs relating to information operation system, office automation,
Committee	internal and external website applications and information security to the needs
	of operation, management and provide strategy to prevent the risk of information
	security and its efficiency.
Secretarial	Handle the affairs of general services, secretary, legal affairs, public relations,
Dept.	etc. Reinforce legal sense of employees to decrease the risks of violating law.
Occupational	Responsible for occupational safety and health management, formulating policies
Safety Office	and supervising related affairs to ensure safety of workers and reduce the risk
	andloss ofoccupational hazards.
Accounting	Handle all accounting matters including the costs, accounts, taxation to ensure
Dept.	management efficiency of the Company’s operation, the reliability of financial
	report, and the adherence of related accounting regulations to reduce company
	operation risks.
Finance Dept.	Responsible for financial operation strategy, investment strategy, financial
	management, and dividend strategy, as well as investor relationship in order to
	minimize financial exposure, uphold financial opportunity and maximize
	shareholders’bestinterest.
Domestic	Plan and implement domestic marketing strategy, credit customers, and identify
SalesDept.	market trends to achieve business goals andreducerelevantrisks.
Export Sales	Plan and implement oversea marketing strategy, credit customers, and identify
Dept.	market trends to achieve business goals andreducerelevantrisks.
Purchasing	Handle all purchasing and contract issuing matters, setting up hedging
Dept.	mechanism to cope with changes in raw materials prices and shortage of raw
	materials supply.
Hsinchu Plant	Take charge of R&D, production technology, quality control, planning
Hualien Plant	production policies in collaboration with sales strategies to reduce production
	risks.

The Company has established an information security risk management framework:

An IT Steering Committee was established to review internal information application systems, office automation, network information, and information security protection measures on a quarterly basis, and to provide tools for operations, management, and decision-making to reduce information security and benefit management risks. We have established “Asia Cement Personal Data Protection Management Measures” and “Asia Cement Computerized Information System Processing” in accordance with Articles 8 and 9 of the Regulations Governing Establishment of Internal Control Systems by Public Companies; in addition, the “Information and Communication Security Inspection Audit” has been incorporated into our 2019 and 2020 annual audit plans. The aforesaid measures have all been submitted to and approved by the Board of Directors.

Information security policy:

Our "Computerized Information System Processing" regulates the management system for various types of IT data and information in the process of output, use, and preservation. Besides, the "Regulations for Use of IT Equipment and Information Software by Employees", regulates various information security behaviors that employees must observe in carrying out their business.

Specific management plan:

A total of 20 inspections were carried out in 2019, including the "Information Security Audit" (once) "Information System Internal Control Self-assessment" (twice), "SAP Sensitive Permission Authorization and Function Conflict Anomaly Check" (quarterly) and" SAP Super User Sensitive Transaction Check" (monthly) performed each by an external unit and an internal audit unit.

3.2 Directors, Supervisors and Management Team

3.2.1 Directors and Supervisors

Title	Elected Date	Term	Date First	Shareholding when Elected	Shareholding when Elected	Current Shareholding	Current Shareholding	Spouse & Minor	Spouse & Minor	Experience	Other Position	Executives,	Directors or Supervisors	Directors or Supervisors
Name		(Years)	Elected					Shareholding		(Education)		who are spouses or within		two degrees
													of kinship
				Shares	%	Shares	%	Shares	%			Title	Name	Relation
Chairman	2017.06.27	3	1975.04.28							Honorary	Chairman, Far Eastern	Director	Connie Hsu	Sibling
Douglas Tong										Doctor, Chiao	New Century Corp.	Director	Peter Hsu	Sibling
Hsu										Tung University	Chairman, Far Eastone	Director	Johnny Shih	relatives by
										Master of	Telecommunications			marriage
				23,278,334	0.69%	23,278,334	0.69%	6,352,467	0.19%	University of Notre Dame,	Co., Ltd Chairman, Far Eastern
										Master of	Department Stores Ltd.
										Economics,
										Columbia
										University
Director	2017.06.27	3	1981.04.24							Mechanical	Senior Advisor, Asia	-	-	-
Tsai Hsiung Chang				459,350 *750,511,324	0.01% *22.33%	459,350 *750,511,32 4	0.01% *22.33%	110,877	0.00%	Technology Section, National Central Industrial College (Chongqing)	Cement (China) Holdings Corp. Director, U-Ming Marine Transport Corp. Director, Yuan Ze Uni.
Director	2017.06.27	3	1984.04.25							Master of	Vice Chairman, Far	Chairman	Douglas	relatives by
Johnny Shih				453,745 *750,511,324	0.01% *22.33%	453,745 *750,511,32 4	0.01% *22.33%	7,225,993	0.21%	Computer, Columbia University	Eastern New Century Corp. Vice Chairman, Oriental Union Chemical Corp.	Director Director	Tong Hsu Connie Hsu Peter Hsu	marriage relatives by marriage relatives by
														marriage
Director C.V. Chen	2017.06.27	3	1987.04.16	338,429 *750,511,324	0.01% *22.33%	338,429 *750,511,32 4	0.01% *22.33%	0	0%	S.J.D., Harvard University	Senior Partner, Lee and Li Attorneys-At-Law Chairman, Taipei European School	-	-	-
Director Chin-Der Ou	2017.06.27	3	2005.06.09	0 *3,849,468	0% *0.11%	0 *3,849,468	0% *0.11%	0	0%	Ph.D., Case Western Reserve University	Director, Taiwan Construction Research Institute	-	-	-
Director	2017.06.27	3	2005.06.09							Yi-Lan	President, Asia Cement	-	-	-
Kun Yen Lee				2,361,557	0.07%	2,361,557	0.07%	0	0%	Elementary	Corp.
				*1,895,136	*0.06%	*1,895,136	*0.06%			School	Director, U-Ming
											MarineTransport Corp.
Director	2017.06.27	3	2002.06.07							Master of	Vice Chairman, Far	Chairman	Douglas	Sibling
Peter Hsu										Operations	Eastern New Century		Tong Hsu
				13,454,981	0.40%	13,454,981	0.40%	0	0%	Research,	Corp.	Director	Connie Hsu	Sibling
				*4,819,800	*0.14%	*6,218,800	*0.19%			Stanford	Director, Far Eastone	Director	Johnny Shih	relatives by
										University	Telecommunications			marriage
										Master of	Co., Ltd

-18-	Information Science, UCLA
	Director Chen Kun Chang 2017.06.27 3 2011.06.22 29,745 4,819,800 0.00% 0.14% 29,745 6,218,800 0.00% 0.19% 5,358 0.00% Mechanical Section, National Taipei Institute of Technology Vice CEO, Asia Cement (China) Holdings Corp. President, Jiangxi Yadong Cement Corp. - - -
	Director Connie Hsu 2017.06.27 3 1990.04.12 14,264,734 4,837,436 0.42% 0.14% 5,264,734 4,837,436 0.16% 0.14% 0 0% Bachelor of Biology, California State University Director, Oriental Institute of Technology Director, Far Eastern Y.Z. Hsu Science and Technology Memorial Foundation Chairman Director Director Douglas Tong Hsu Peter Hsu Johnny Shih Sibling Sibling relatives by marriage
	Director Ruey Long Chen 2017.06.27 3 2011.06.22 0 1,560,068 0% 0.05% 0 1,560,068 0% 0.05% 0 0% Bachelor of Economics, National Chung Hsing University Chairman, China Petrochemical Industry Development Co., Ltd. Chairman, Sinocon Industrial Standards Foundation Chairman, Powerchip Technology Corp. Secretary General, Cross-Strait EntrepreneurSummit - - -
	Director Champion Lee 2017.06.27 3 2002.06.07 0 181,566,797 0% 5.40% 0 181,566,79 7 0% 5.40% 0 0% Master of Business Administration, Texas A&I University Director , Far Eastern New Century Corp. Director, U-Ming Marine Transport Corp. - - -
	Director Kwan-Tao Li 2017.06.27 3 2002.06.07 642,963 1,505,585 0.02% 0.04% 642,963 1,505,585 0.02% 0.04% 0 0% Master, New York University Chief Counselor, Lee and Li Attorneys-At-Law Director, Far Eastern New Century Corp. Director, Far Eastern Y.Z. Hsu Science and Technology Memorial Foundation: - - -
	Independent Director Ta-Chou Huang 2017.06.27 3 2014.06.16 0 0% 0 0% 0 0% PhD. in Agriculture, Cornell University Former Taipei CityMayor Honorary Professor, National Taiwan University Chairman, The Association of Parks And OpenSpace - - -
	Independent Director Chi Schive 2017.06.27 3 2014.06.16 0 0% 20,000 0% 10,000 0% PhD. in Economics, Case Western Reserve University Former Chair Professor, Soochou University - - -

									Chairman,
									Taiwan Stock
									Exchange
Independent	2017.06.27	3	2014.06.16						PhD. in Business	Chairman , Central	-	-	-
Director									Administration,	Investment Corp.
Gordon S. Chen									National Taiwan
									University
			0	0%	0	0%	0	0%	Former
									Chairman,
									Financial
									Supervisory
									Commission

Note 1: Information on Directors that are Representatives of Institutional Investors:

	Representatives of Far Eastern New CenturyCorp.:	Director Tsai HsiungChang,JohnnyShih,C.V. Chen
	Representative of Bai-YangInvestment Holdings Corp.:	Director Chin-Der Ou
	Representative of Yue DingIndustryCo.,Ltd.:	Director Kun Yen Lee
	Representatives of Far Eastern Y.Z. Hsu Science and	Director Peter Hsu, Chen Kun Chang
	TechnologyMemorial Foundation:
	Representative of HueyKangInvestment Corp.:	Director Connie Hsu(passed awayon May13,2020)
	Representative of Ta Chu Chemical Fiber Co.,Ltd: Representative of Far Eastern Medical Foundation: Representative of U-MingCorp.:	Director RueyLongChen Director Champion Lee Director Kwan-Tao Li

Note 2: “*” indicates the number of shares held by Institutional Investors respectively represented by directors listed above. Note 3: The shareholding excludes the shareholding that the trustor retains the power to decide the allocation of the trust fund. Note 4: There is no director holding shares in the name of other person. Note 5: All Directors are Taiwanese Citizens. Director Connie Hsu is female while other Directors are male.

The First and Most Recent Date for Institutional Investors Elected as Directors

Name of the Institutional Investors	First Date Elected	Most Recent Date Elected
Far Eastern New Century Corp	1987.04.16	2017.06.27
Bai-Yang Investment Holdings Corp.	2001.05.16	2017.06.27
Yue Ding Industry Co., Ltd.	2005.06.09	2017.06.27
Far Eastern Y.Z. Hsu Science and Technology Memorial Foundation	2005.06.09	2017.06.27
Huey Kang Investment Corp.	2008.06.17	2017.06.27
Ta Chu Chemical Fiber Co., Ltd.	2011.06.22	2017.06.27
Far Eastern Medical Foundation	1987.04.16	2017.06.27
U-Ming Corp.	1993.05.07	2017.06.27

Note: The first date elected as directors is based on the annual reports of the Company.

3.2.2 Major Shareholders of the Institutional Shareholders

Name of Institutional Shareholder	Major Shareholder of the Institutional Shareholders	%
Far Eastern New Century Corporation	AsiaCementCorporation	23.77
	Oriental Institute of Technology	4.81
	Far Eastern Medical Foundation	3.61
	Far Eastern Memorial Foundation	3.42
	NanShan Life InsuranceCo. ,Ltd.	2.89
	Yuan-ZeUniversity	2.74
	China Life InsuranceCo.,Ltd.	1.85
	Douglas TongHsu	1.71
	Der ChingInvestment Corp.	1.55
	ChungHwa Post Co.,Ltd.	1.38
Far Eastern Medical Foundation	Y. Z. Hsu	76.90
	He Zongyan	2.31
	WangShu-peng	2.31
	Hsu Wei Yuan	2.31
	HuangYingChung	2.31
	Douglas TongHsu	2.31
	Laurence M. Yang	2.31
	John Hsu	2.31
	JohnnyShih	2.31
	S.S. Hsu	2.31
	Yu Wei San	2.31
Far Eastern Y. Z. Hsu Science and Technology Memorial Foundation	Far Eastern International Bank	25.00
	Far Eastern New Century Corporation (Original from Far Eastern Textile Ltd.)	23.00
	AsiaCementCorporation	18.00
	Far EasTone Telecommunications Co.,Ltd	8.00
	Far Eastern Department Stores Co.,Ltd.	8.00
	U-MingMarine Transport Corp.	4.00
	Oriental Union Chemical Corp.	4.00
	Yuan DingInvestment Company	2.00
	Oriental Securities Co.,Ltd.	2.00
Huey Kang Investment Corp.	Connie Hsu	50.58
	H.G. Yang	24.71
	H.M. Yang	24.71
Bai YangInvestmentCorp.	Far Eastern DepartmentStoresCo.,Ltd.	100.00
U-Ming Corp.	Far Eastern DepartmentStoresCo.,Ltd.	100.00
Yue Ding Industry Co.,Ltd.	Fu Da TransportationCo.,Ltd.	26.95
	Yue-TungInvestmentCorp.	25.36
	An HoGarmentCo.,Ltd.	15.66
	DingYuan International InvestmentCorp.	13.20
	Ton Fu InvestmentCorp.	4.61
	TaChuChemical FiberCo.,Ltd.	3.89
	Ya Li Precast Prestressed Concrete Industries Corp.	3.89

-20-

Name of Institutional Shareholder	Major Shareholder of the Institutional Shareholders	%
	Yuan Ding Co.,Ltd.	2.59
	Bai DingInvestment Co.,Ltd.	2.31
	Yu Ming Co.,Ltd.	1.53
Ta Chu Chemical Fiber Co.,Ltd.	Yuan DingInvestmentCompany	41.86
	Yue DingIndustry Co.,Ltd.	38.76
	Yue-Lee Investment Company	19.38

3.2.3 Major Shareholders of the Major Shareholders That Are Juridical Persons

Name of Juridical Persons	Major Shareholder of the Juridical Persons	%
Asia Cement Corporation	Far Eastern New CenturyCorporation	22.33
	Far Eastern Medical Foundation	5.40
	Labor Pension Fund Committee of Far Eastern New CenturyCorporation	1.55
	Yuan DingInvestment Company	1.53
	Yuanta/P-shares Taiwan Dividend Plus ETF	1.51
	Far Eastern Department Stores Co.,Ltd.	1.49
	Yuan-Ze University	1.41
	Far Eastern Memorial Foundation	1.31
	Yu Yuan Investment Co.,Ltd	1.29
	Yu ChangInvestment Company	1.26
Oriental Institute of Technology	Asia Cement Corporation	50.00
	Far Eastern New Century Corporation (Original from Far Eastern Textile Ltd.)	50.00
Far Eastern Medical Foundation	Y. Z. Hsu	76.90
	He Zongyan	2.31
	WangShu-peng	2.31
	Hsu Wei Yuan	2.31
	HuangYingChung	2.31
	Douglas TongHsu	2.31
	Laurence M. Yang	2.31
	John Hsu	2.31
	JohnnyShih	2.31
	S.S. Hsu	2.31
	Yu Wei San	2.31
Far Eastern Memorial Foundation	Y. Z. Hsu	50.00
	Hsu Yi Chu	50.00
Nan Shan Life Insurance Co. , Ltd.	First Commercial Bank Trustee Account For Representative of Ruen Chen Investment HoldingCo.,Ltd.	60.01
	Ruen Chen Investment HoldingCo.,Ltd.	29.54
	Y. T. Du	2.90
	Ruen Tai ShingCo.,Ltd.	0.30
	Ruen Hua Dyeing& WeavingCo.,Ltd.	0.27
	Ruentex Development Co.,Ltd.	0.23

-21-

Name of Juridical Persons	Major Shareholder of the Juridical Persons	%
	Ruentex Industries Ltd.	0.21
	Taishin International Bank Trust Account of Nan Shan Life Insurance Co.,Ltd.	0.21
	Yen Sin Corporation	0.16
	Ruentex LeasingCo.,Ltd.	0.13
Yuan-Ze University	U-MingMarine Transport Corp.	55.21
	Far Eastern Medical Foundation	26.05
	Far Eastern New Century Corporation (Original from Far Eastern Textile Ltd.)	5.52
	Fu MingTransportation Co.,Ltd.	5.25
	Far Eastern Memorial Foundation	4.91
	Asia Cement Corporation	2.76
	Connie Hsu	0.28
	Y. Z. Hsu	0.01
	Yu Chao-Chung	0.01
China Life Insurance Co., Ltd.	China Development Financial HoldingCorp.	26.16
	KGI Securities Co.,Ltd	8.66
	CathayLife Insurance Co.,Ltd.	3.04
	Videoland Inc.	2.42
	Labor Pension Fund(the New Fund)	1.61
	LinglangZhan	1.24
	PGIA Comprehensive International Stock Index Fund Dedicated Account, managed by PGIA, under custody of JP Morgan, Taipei Branch.	1.21
	Citi as Trustee For The Government of Singapore Investment Corp.	1.17
	The Norwegian Central Bank Investment Dedicated Account, under custody of CITI Bank	1.12
	Labor Insurance Fund	1.03
Der Ching Investment Corp.	Asia Cement Corporation	99.99
	Asia Investment Corp.	0.01
ChungHwa Post Co., Ltd.	Ministry of Transportation and Communications	100.00
Far Eastern International Bank	Yu Yuan Investment Co., Ltd.	4.95
	Yue Li Investment Corp.	4.39
	Asia Investment Corp.	4.03
	Der ChingInvestment Corp.	4.03
	Yue-TungInvestment Corp.	3.89
	Yuan DingInvestment Co., Ltd.	3.56
	Kai Yuan International Investment Co., Ltd.	3.21
	Yuan TongInvestment Co.,Ltd.	3.20
	Special Account for trust property of Far Eastern International Bank employee in custody of FEIB	3.10

-22-

Name of Juridical Persons	Major Shareholder of the Juridical Persons	%
	DingYuan International Investment Corp.	2.64
Far Eastern New Century Corporation	Asia Cement Corporation	23.77
	Oriental Institute of Technology	4.81
	Far Eastern Medical Foundation	3.61
	Far Eastern Memorial Foundation	3.42
	Nan Shan Life Insurance Co. , Ltd.	2.89
	Yuan-Ze University	2.74
	China Life Insurance Co., Ltd.	1.85
	Douglas TongHsu	1.71
	Der ChingInvestment Corp.	1.55
	ChungHwa Post Co.,Ltd.	1.38
Far EasTone Telecommunications Co., Ltd	Yuan DingInvestment Co., Ltd.	32.73
	Shin KongLife Insurance Co., Ltd.	9.70
	CathayLife Insurance Co.,Ltd.	6.89
	NTT DOCOMO Inc.	4.71
	ChungHwa Post Co.,Ltd.	3.24
	Yuan TongInvestment Co., Ltd.	3.08
	Fubon Life Insurance Co., Ltd.	1.92
	Nan Shan Life Insurance Co., Ltd.	1.82
	An Ho Garment Co., Ltd.	1.25
	Taiwan Life Insurance Co,Ltd.	1.17
Far Eastern Department Stores Co.,Ltd.	Far Eastern New CenturyCorporation	17.06
	PJ Asset Management Co.,Ltd.	7.75
	Asia Cement Corporation	5.65
	Yuan DingInvestment Co.,Ltd.	5.33
	Chia Yuan Investment Company	5.05
	Yuan-Ze University	4.75
	Yuan TongInvestment Co.,Ltd	3.61
	The Norwegian Central Bank Investment Dedicated Account, under custody of CITI Bank	2.26
	The committee of Employee Pension Fund of Far Eastern DepartmentStoresCo.,Ltd.	2.11
	Yu Yuan Investment Co.,Ltd	2.06
U-Ming Marine Transport Corp.	Asia Cement Corporation	39.25
	Public Service Pension Fund Management Board	2.08
	CathayLife Insurance Co.,Ltd.	1.60
	Yuan DingInvestment Co., Ltd.	1.05
	Fubon Life Insurance Co.,Ltd.	1.04

-23-

Name of Juridical Persons	Major Shareholder of the Juridical Persons	%
	Cape Ann Global Developing Markets Fund Investment Dedicated Account, under custody of Bank of Taiwan	1.00
	Yu Yuan Investment Co.,Ltd	0.94
	DingShen Investment Co.,Ltd.	0.94
	TransGlobe Life Insurance Co.,Ltd.	0.93
	Asia Investment Co.,Ltd.	0.92
Oriental Union Chemical Corp.	Far Eastern New CenturyCorporation	9.17
	Yuan DingInvestment Company	8.00
	Asia Cement Corporation	7.20
	Yuan TongInvestment Co.,Ltd	5.61
	Yu Yuan Investment Co.,Ltd	3.75
	Kai Yuan International Investment Co.,Ltd.	3.67
	DingYuan International Investment Co.,Ltd.	3.09
	Fubon Life Insurance Co.,Ltd.	2.80
	CathayLife Insurance Co.,Ltd.	2.47
	Ton Fu Investment Corp.	1.55
Yuan Ding Investment Company	Far Eastern New CenturyCorporation	99.40
	An Ho Garment Co.,Ltd.	0.30
	Ta Chu Chemical Fiber Co.,Ltd.	0.30
Oriental Securities Co., Ltd.	Yuan DingInvestment Company	25.96
	Far Eastern Department Stores Co.,Ltd.	19.66
	Far Eastern New CenturyCorporation	19.65
	Asia Cement Corporation	18.93
	Bai DingInvestment Co.,Ltd.	13.61
	An Ho Garment Co.,Ltd.	1.17
	Ta Chu Chemical Fiber Co.,Ltd.	0.51
	Douglas TongHsu	0.09
	Shaw Y. Wang	0.07
	Fan Yu Chen	0.03
Fu Da Transportation Co., Ltd.	Fu MingTransportation Co.,Ltd.	99.87
	Asia InvestmentCorp.	0.03
Yue-Tung Investment Corp.	U-MingMarine Transport Corp.	73.54
	U-Ming Marine Transport (Singapore) Private Ltd.	26.46
An Ho Garment Co.,Ltd.	Far Eastern New CenturyCorporation	100.0
Ding Yuan International InvestmentCorp.	Far Eastern New Century Corporation	100.0
Ton Fu Investment Corp.	Oriental Union Chemical Corp.	100.0
Ta Chu Chemical Fiber Co., Ltd.	Yuan DingInvestment Company	41.86
	Yue DingIndustryCo.,Ltd.	38.76

-24-

Name of Juridical Persons	Major Shareholder of the Juridical Persons	%
	Yue-Lee Investment Company	19.38
Ya Li Precast Prestressed Concrete Industries Corp.	Asia Cement Corporation	83.81
	Far-Eastern Construction Engineering Co.,Ltd.	16.03
Yuan Ding Co.,Ltd.	Far Eastern New CenturyCorporation	37.13
	Asia Cement Corporation	35.50
	Der ChingInvestment Corp.	14.50
	Yuan DingInvestment Company	12.86
	Yu MingTradingCorp.	0.002
	Far Eastern Department Stores Co.,Ltd.	0.001
Bai Ding Investment Corp.	Far Eastern Department Stores Co.,Ltd.	66.66
	Bai YangInvestment Corp.	33.34
Yu Ming Trading Corp.	Bai DingInvestment Co.,Ltd	47.00
	Yuan DingInvestment Company	45.50
	Yue DingIndustryCo.,Ltd.	5.00
	Yuan DingCo.,Ltd.	1.00
	Ding & Ding Management Consultants Co., Ltd	1.00
	Yuan DingLeasingCorp.	0.50
Yue Ding Industry Co.,Ltd.	Fu Da TransportationCo.,Ltd.	26.95
	Yue-TungInvestment Corp.	25.36
	An HoGarmentCo.,Ltd.	15.66
	DingYuan International InvestmentCorp.	13.20
	Ton Fu InvestmentCorp.	4.61
	TaChuChemical FiberCo.,Ltd.	3.89
	Ya Li Precast Prestressed Concrete Industries Corp.	3.89
	Yuan Ding Co.,Ltd.	2.59
	Bai DingInvestmentCo.,Ltd.	2.31
	Yu MingTrading Corp.	1.53
Yue-Lee Investment Company	U-MingMarine Transport Corp.	68.18
	U-Ming Marine Transport (Singapore) Private Ltd.	31.82

-25-

3.2.4 Professional Qualifications and Independence Analysis of Directors

Criteria Name	Meet One of the Following Professional Qualification Requirements, Together with at Least Five Years Work Experience	Meet One of the Following Professional Qualification Requirements, Together with at Least Five Years Work Experience	Meet One of the Following Professional Qualification Requirements, Together with at Least Five Years Work Experience	Independence Criteria (Note)	Independence Criteria (Note)	Independence Criteria (Note)	Independence Criteria (Note)	Independence Criteria (Note)	Independence Criteria (Note)	Independence Criteria (Note)	Independence Criteria (Note)	Independence Criteria (Note)	Independence Criteria (Note)	Independence Criteria (Note)	Independence Criteria (Note)	Number of Other Public Companies in Which the Individual is Concurrently Serving as an Independent Director
	An Instructor or Higher Position in a Department of Commerce, Law, Finance, Accounting, or Other Academic Department Related to the Business Needs of the Company in a Public or Private Junior College, College or University	A Judge, Public Prosecutor, Attorney, Certified Public Accountant, or Other Professional or Technical Specialist Who has Passed a National Examination and been Awarded a Certificate in a Profession Necessary for the Business of the Company	Have Work Experience in the Areas of Commerce, Law, Finance, or Accounting, or Otherwise Necessary for the Business of the Company	1	2	3	4	5	6	7	8	9	10	11	12
Douglas Tong Hsu			ˇ			ˇ						ˇ		ˇ	ˇ	0
Tsai Hsiung Chang			ˇ			ˇ	ˇ					ˇ	ˇ	ˇ		0
Johnny Shih			ˇ			ˇ						ˇ		ˇ		0
C.V. Chen	ˇ	ˇ	ˇ	ˇ		ˇ	ˇ	ˇ	ˇ	ˇ	ˇ		ˇ	ˇ		1
Kun Yen Lee			ˇ			ˇ	ˇ	ˇ				ˇ	ˇ	ˇ		0
Peter Hsu			ˇ			ˇ				ˇ		ˇ				0
Chen Kun Chang			ˇ			ˇ	ˇ	ˇ		ˇ	ˇ	ˇ				0
Connie Hsu			ˇ	ˇ		ˇ		ˇ	ˇ	ˇ		ˇ				0
Ruey Long Chen		ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ				2
Champion Lee			ˇ			ˇ	ˇ			ˇ	ˇ	ˇ				0
Chin-Der Ou	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ				1
Kwan-Tao Li	ˇ	ˇ	ˇ	ˇ		ˇ	ˇ		ˇ		ˇ	ˇ				0
Ta-Chou Huang	ˇ		ˇ	ˇ		ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ				0
Chi Schive	ˇ		ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ				3
Gordon S. Chen	ˇ		ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ	ˇ				2

Note: Please tick the corresponding boxes that apply to the directors or supervisors during the two years prior to being elected or during the term of office.

Not an employee of the company or any of its affiliates.
Not a director or supervisor of the company or any of its affiliates. Not apply to independent directors appointed in accordance with the Act or the laws and

regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent.

Not a natural-person shareholder who holds shares, together with those held by the person's spouse, minor children, or held by the person under others' names, in an aggregate of one percent or more of the total number of issued shares of the company or ranking in the top 10 in holdings.
Not a spouse, relative within the second degree of kinship, or lineal relative within the third degree of kinship, of a managerial officer under subparagraph 1 or any of the persons in the preceding two subparagraphs.
Not a director, supervisor, or employee of a corporate shareholder that directly holds five percent or more of the total number of issued shares of the company, or that ranks among the top five in shareholdings, or that designates its representative to serve as a director or supervisor of the company under Article 27, paragraph 1 or 2 of the Company Act. Not apply to independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent.
If a majority of the company's director seats or voting shares and those of any other company are controlled by the same person: not a director, supervisor, or employee of that other company. Not apply to independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent.
If the chairperson, general manager, or person holding an equivalent position of the company and a person in any of those positions at another company or institution are the same person or are spouses: not a director (or governor), supervisor, or employee of that other company or institution. Not apply to independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent.
Not a director, supervisor, officer, or shareholder holding five percent or more of the shares, of a specified company or institution that has a financial or business relationship with the company. Not apply to independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent, if the specified company or institution holds 20 percent or more and no more than 50 percent of the total number of issued shares of the public company.
Not a professional individual who, or an owner, partner, director, supervisor, or officer of a sole proprietorship, partnership, company, or institution that, provides auditing services to the company or any affiliate of the company, or that provides commercial, legal, financial, accounting or related services to the company or any affiliate of the company for which the provider in the past 2 years has received cumulative compensation exceeding NT$500,000, or a spouse thereof; provided, this restriction does not apply to a member of the remuneration committee, public tender offer review committee, or special committee for merger/consolidation and acquisition, who exercises powers pursuant to the Act or to the Business Mergers and Acquisitions Act or related laws or regulations.
Not having a marital relationship, or a relative within the second degree of kinship to any other director of the Company.
Not been a person of any conditions defined in Article 30 of the Company Law.
Not a governmental, juridical person or its representative as defined in Article 27 of the Company Law.
The Company elected 3 independent directors, Ta-Chou Huang, Chi Schive, and Gordon S. Chen on the Shareholders’ Meeting on June 27, 2017.

3.2.5 Management Team

As of Mar. 31, 2019

									As of Mar. 31,20
Title	Name	Gender	Effective Date	Shareholding		Spouse & Minor Shareholding		Experience(Education)	Other Title
				Shares	%	Shares	%
President	Kun Yen Lee	Male	2000.08.01	2,361,557	0.0703	0	0	Chairman of Ya Tung Ready-Mixed Concrete Co., LTD	Director, U-Ming Marine Transport Corp.
Chief Executive Vice President	Y.F. Chang	Male	2000.08.01	811	0.0000	0	0	Bachelor degree in Chemical, Tunghai University	Director, China Hi-Ment Corporation
Executive Vice President	Doris Wu	Female	2016.04.01	0	0	0	0	Bachelor degree in Accounting, California State University	Supervisor, Oriental Union Chemical Corp.
Vice President	C.M. Chen	Male	2007.07.01	39,801	0.0012	68,596	0.0020	Bachelor degree in International Trade, Tamkang University	Director, Ya Tung Ready-Mixed Concrete Co., LTD
Vice President	W.K. Chou	Male	2007.07.01	4,962	0.0001	4,962	0.0001	Bachelor degree in Law, Soochow University	Supervisor, Pan Asia Corporation
General Plant Manager	Z.P. Chang	Male	2009.07.01	33,999	0.0010	53,588	0.0016	Bachelor degree in Electrical Engineering, National Taiwan University	Supervisor, U-Ming Marine Transport Corp
Vice President	T.L. Yu	Male	2019.01.01	122,202	0.0036	98	0.0000	Bachelor degree in Business Administration, University of the Philippines	Director, Yu Yuan Investment Co., Ltd
Deputy Chief Auditor	W.H. Yeh	Male	2013.10.16	0	0	0	0	Bachelor degree in Accounting, Soochow University	Supervisor, Nan Hwa Cement Corp.
Special Assistant of President Office	T.M. Chen	Male	2011.01.01	147,268	0.0044	0	0	Bachelor degree in sociology, National Taiwan University	Director, Yu Yuan Investment Co., Ltd
Manager of Secretarial Dept.	Manfred Wang	Male	2012.10.01	888	0	0	0	Bachelor degree in Law, Soochow University	Director, Fu Shan Mineral Stone Co., Ltd.

Title	Name	Gender	Effective Date	Shareholding	Shareholding	Spouse & Minor Shareholding	Spouse & Minor Shareholding	Experience(Education)	Other Title
				Shares	%	Shares	%
Assistant Vice President	H.Y. Kao	Female	2013.10.16	832	0	467	0	Bachelor degree in Accounting, Soochow University	Director, Der Ching Investment Corp.
Assistant Vice President of Finance Dept.	Dana Lee	Female	2019.03.01	8,971	0.0002	0	0	Master degree in Business Administration,, Soochow University	Supervisor, Ya Li Transportation Corp.
Assistant Vice President of Finance Dept.	Karen Yang	Female	2019.03.01	0	0	0	0	Master degree in Business Administration, Pace UniversityUSA	Supervisor, Der Ching Investment Corp.
Manager of Domestic Sales Dept.	C.H. Chung	Male	2018.09.01	0	0	0	0	Master degree in International Business Administration, Da Yeh University	Director, China Hi-Ment Corporation
Manager of Export Sales Dept.	Gary Lee	Male	2018.09.01	0	0	0	0	Master degree in International business, Soochow University	Director, Ya Li Precast Concrete India Pvt. Ltd
Manager of the Hsinchu Plant	C.H Chuang	Male	2019.01.08	0	0	0	0	Bachelor degree in Mechanical Engineering, National Taiwan Institute of Technology	-

＊ Manfred Wang retired on Mar. 5, 2020.

＊ There is no manager holding shares in the name of any other person.

＊ Managers are spouse or within second- degree of consanguinity to each other: None.

＊ All managers are Taiwanese citizens.

3.2.6 Remuneration of Directors, Supervisors, President, and Vice Presidents

1. Remuneration of Directors

Title	Name				Remun	eration	eration			Ratio of Total Remuneration (A+B+C+D) to Net Income (%)	Ratio of Total Remuneration (A+B+C+D) to Net Income (%)	Rel	evant Remuner	ation Recei	ved by Directo	rs Who are Also Employees	rs Who are Also Employees	Ratio of Total Compensation (A+B+C+D+E+F+G) to Net Income (%)	Ratio of Total Compensation (A+B+C+D+E+F+G) to Net Income (%)	Remuneration from ventures other than subsidiaries or from the parent company (Note 1)
		Base Compensation (A)		Severan	ce Pay (B)	Directors Compensation(C)		Allow	ances (D)			Salary, B Allow	onuses, and ances (E)	Severan	ce Pay (F)	Employee Compensation (G)
		The company	All companies in the consolidated financial statements	The company	Companies in the consolidated financial statements	The company	Companies in the consolidated financial statements	The company	Companies in the consolidated financial statements	The company	Companies in the consolidated financial statements	The company	Companies in the consolidated financial statements	The company	Companies in the consolidated financial statements	The company	Companies in the consolidated financial statements	The company	Companies in the consolidated financial statements
																Cash	Cash
Chairman	Douglas Tong Hsu	14,511	16,340	0	0	223,896	226,220	1,056	6,596	1.371%	1.427%	7,083	11,680	216	216	6,600	6,600	1.451%	1.533%	216,084
Director Director Director	Far Eastern New Century Corp. Representatives: Tsai Hsiung Chang Johnny Shih C.V. Chen
Director	Yue Ding Industry Co., Ltd. Representative: Kun Yen Lee
Director Director	Far Eastern Y.Z. Hsu Science and Technology Memorial Foundation Representatives: Peter Hsu Chen Kun Chang
Director	Ta Chu Chemical Fiber Co.,Ltd Representative: RueyLongChen
Director	Huey Kang Investment Corp. Representative: Connie Hsu
Director	Far Eastern Medical Foundation Representative: Champion Lee

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Director	Bai-Yang Investment Holdings Corp Representative: Chin-Der Ou
Director	U-Ming Corp Representative: Kwan-Tao Li
Independe nt Director	Ta-Chou Huang Chi Schive Gordon S. Chen	0	0	0	0	6,400	6,400	360	360	0.039%	0.039%	0	0	0	0	0	0	0.039%	0.039%	0

＊ In addition to the above remuneration, director remuneration received from companies included in the consolidated financial statements in the most recent year to compensate directors for their services, such as being independent contractors: None.

＊ Please refer to Consolidated Operational Report for the list of All Companies.

＊ Pensions funded according to applicable laws.

＊ No stock bonus, warrant, or restricted stock awards for employees have been distributed from ACC and all companies listed in consolidated operational report. ＊ Director Tsai Hsiung Chang is assigned one vehicle. The monthly rental is NT$ 46,200, and the annual remuneration of the driver is about NT$ 700,000. ＊ Director and President Kun Yen Lee is assigned one vehicle. The monthly rental is NT$ 77,800, and the annual remuneration of driver is about NT$ 700,000. ＊ Within recent two fiscal years, all ACC directors’ remuneration accounted for 2.219% and 1.490% of ACC net income. Total directors’ remuneration paid by all companies listed in consolidated operational report accounted for 2.350% 及 1.572% of net income received from those companies.

Classification of Remuneration Paid to ACC Directors	Name of Directors	Name of Directors	Name of Directors	Name of Directors
	A+B+C+D (Please refer to listed information above)		A+B+C+D+E+F+G (Please refer to listed information above)
	ACC	All companies listed in Consolidated Operational Report	ACC	All companies listed in Consolidated Operational Report
Under NT$1,000,000	Connie Hsu, Yue Ding Industry Co.,Ltd.	Connie Hsu, Yue Ding Industry Co.,Ltd.	Connie Hsu, Yue Ding Industry Co.,Ltd.	Connie Hsu, Yue Ding Industry Co.,Ltd.
NT$1,000,000～NT$2,000,000	C.V. Chen, Chen Kun Chang, Ruey Long Chen, Champion Lee, Chin-Der Ou,Kwan-Tao Li	C.V. Chen, Ruey Long Chen, Champion Lee, Chin-Der Ou, Kwan-Tao Li	C.V. Chen, Chen Kun Chang, Ruey Long Chen, Champion Lee, Chin-Der Ou,Kwan-Tao Li	C.V. Chen, Ruey Long Chen, Chin-Der Ou
NT$2,000,000～NT$3,500,000	Ta-Chou Huang, Chi Schive, Gordon S. Chen	Chen Kun Chang, Ta-Chou Huang, Chi Schive, Gordon S. Chen	Ta-Chou Huang, Chi Schive, Gordon S. Chen	Kwan-Tao Li, Ta-Chou Huang, Chi Schive, Gordon S. Chen
NT$3,500,000～NT$5,000,000	-	-	-	-
NT$5,000,000～NT$10,000,000	Tsai Hsiung Chang, Bai-Yang Investment Holdings Corp,	Bai-Yang Investment Holdings Corp,	Bai-Yang Investment Holdings Corp,	Chen Kun Chang, Champion Lee,Bai-YangInvestment

	Huey Kang Investment Corp, Ta Chu Chemical Fiber Co.,Ltd, Far Eastern Y.Z.Hsu Science and Technology Memorial Foundation, U-Ming Corp, Far Eastern Medical Foundation	Huey Kang Investment Corp, Ta Chu Chemical Fiber Co.,Ltd, Far Eastern Y.Z.Hsu Science and Technology Memorial Foundation, U-Ming Corp, Far Eastern Medical Foundation	Huey Kang Investment Corp, Ta Chu Chemical Fiber Co.,Ltd, Far Eastern Y.Z.Hsu Science and Technology Memorial Foundation, U-Ming Corp, Far Eastern Medical Foundation	Holdings Corp, Huey Kang Investment Corp, Ta Chu Chemical Fiber Co.,Ltd, Far Eastern Y.Z.Hsu Science and Technology Memorial Foundation, U-Ming Corp, Far Eastern Medical Foundation
NT$10,000,000～NT$15,000,000	Johnny Shih, Kun Yen Lee, Peter Hsu,	Kun Yen Lee, Tsai Hsiung Chang,Peter Hsu,	Johnny Shih, Peter Hsu, Tsai HsiungChang,	-
NT$15,000,000～NT$30,000,000	Far Eastern New Century Corp.	Far Eastern New Century Corp., Johnny Shih,	Far Eastern New Century Corp., Kun Yen Lee	Far Eastern New Century Corp., Kun Yen Lee, Tsai Hsiung Chang,
NT$30,000,000～NT$50,000,000	Douglas Tong Hsu	Douglas Tong Hsu	Douglas Tong Hsu	Johnny Shih
NT$50,000,000～NT$100,000,000	-	-		Peter Hsu,
Over NT$100,000,000	-	-		Douglas Tong Hsu
Total	23	23	23	23

The link between performance evaluation and remuneration of directors and managers:
A. the link between director performance evaluation and remuneration:
- a. Executive directors may be paid according to the Article 20 of AOI, and shall be approved by the Board of Directors with reference to industry and peer standards. Every year, the annual performance evaluation is made based on individual performance and company performance similar with senior managers.
- b. Attendance fee paid to independent directors serving as members and convener of the Remuneration Committee and Audit committee is in the same standards of affiliated companies.
- c. Article 25 of the AOI stipulates that the remuneration for directors is not more than 2.5% of profit of the current year. The directors' remuneration shall be distributed according to the following principles after the Board of Directors has considered the Company's operating performance and passed the distribution ratio amount:
- (a) The remuneration of directors is allocated first to the legal person. The legal person is then redistributed based on the director's role and performance to the directors.
- (b) For a director who is a natural person, his contribution and professional field to the BOD, Remuneration Committee and Audit Committee would be the reference standard of payment.

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d. Performance evaluation and remuneration are reviewed by the Remuneration Committee and the Board of Directors, and are reviewed at any time depending on actual operating conditions, industrial operating risks, trends, and laws.
C. the link between manager performance evaluation and remuneration:
a. Article 25 of the AOI stipulates that if a profit is made in the year, 1.0% to 4% shall be set aside for employee compensation.
b. The performance evaluation of managers will affect their employee compensation.

＊ The succession planning of the Company's Board of Directors and important managers

Member of the Board of Directors:

In 2017, the Shareholders' meeting amended the "Director Election Rules" which stipulates the director diversity policy in article 3.
The Company complies with the Company's AOI and the board of directors adopts the nomination system for candidates. In addition to assessing the academic experience of each candidate, and referring to the opinions of stakeholders, abide by the "Director Election Rules" and "Corporate Governance Code" to ensure the diversity and independence of directors.
15 directors of the Company's 26th Board of Directors, including 3 independent directors, professional knowledge includes leadership, management, crisis management, industrial knowledge and international outlook, public welfare, legal affairs, legal compliance, economics, administration, finance , Agriculture, etc.
The succession of directors is partly from the senior executives of the company, but most of them still have to be promoted from the talent pool of the national society, especially independent directors who emphasize independence.

5. The Far Eastern Group to which the company belongs has a corporate culture that values corporate governance and talents. Due to the long-term succession planning, there are many companies with professional managers as general managers, vice chairman and chairman of the group.

Important managers:

The Company has cooperated with Yuanzhi University to set up a "training class" for corporate elites. Course training, followed by 30 high-level conference internships and 30 special seminars, the training has achieved good results. At present, more than 90% of the trainees have been promoted. In addition, trainees need to receive about 12 hours of back-training courses every year in order to continue to grow and improve.
Due to the effectiveness of the training, this training plan model has been copied to all subsidiaries of ACC (China).

3. Remuneration of President and Vice Presidents

Unit: NT ＄ 1000

Title	Name	Salary(A)	Salary(A)	Pensions(B)	Pensions(B)	Reward and Allowance etc. (C)	Reward and Allowance etc. (C)	Employees bonus from Distributable Earnings (D)	Employees bonus from Distributable Earnings (D)	Total Amount (A+B+C+D)/Net Income	Total Amount (A+B+C+D)/Net Income	Other remuneration from investment business except subsidiary
		ACC	All companies*	ACC	All companies*	ACC	All companies*	ACC	All *companies **	ACC	All companies*
								Cash Bonus	Cash Bonus
President	Kun Yen Lee	19,257	20,647	756	756	3,863	4,069	23,769	23,769	0.273%	0.282%	1,010
Chief Executive Vice President	Y.F. Chang
Executive Vice President	Doris Wu
VicePresident	C.M. Chen
Vice President	W.K. Chou
Vice President	T.L. Yu
General Plant Manager	Z.P. Chang

＊ Please refer to Consolidated Operational Report for the list of All Companies.
＊ Pensions funded according to applicable law.
＊ No stock bonus, warrant, or restricted stock awards for employees have been distributed from ACC and all companies listed in consolidated operational report.
＊ The chief executive vice president of the Company, Y.F. Chang is assigned one vehicle. The monthly rental is NT ＄ 33,500.
＊ Within recent two fiscal years, total remuneration of the President and Vice Presidents accounted for 0.278% and 0.249% of ACC net income. Total amount of

President and Vice Presidents’ remuneration paid by all companies listed in consolidated operational report accounted for 0.284% 及 0.258% of net income received from those companies.

from those companies.
Classification of Remuneration Paid to ACC President and Vice Presidents	Name of President and Vice Presidents
	ACC	All companies listed in Consolidated Operational Report
NT$2,000,000～NT$3,500,000	-	-
NT$3,500,000～NT$5,000,000	-	-
NT$5,000,000～NT$10,000,000	Kun Yen Lee, Y.F. Chang, Doris Wu, C.M. Chen, W.K. Chou, T.L. Yu, Z.P. Chang	Kun Yen Lee, Y.F. Chang, Doris Wu, C.M. Chen, W.K. Chou, T.L. Yu, Z.P. Chang
Total	7	7

＊ The remuneration of President and Vice Presidents is divided into two parts:
Monthly salary based on fixed salary rank.
Based on ACC’s bonus system, bonus and compensation are distributed mainly in consideration of the Company’s operating performance and individual annual performance.
＊ The Remuneration Committee has approved current remuneration system for the President and Vice Presidents.

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3.2.7 Employees Remuneration to Management Team

	Title	Name	Stock Bonus	Cash Bonus	Total Amount	Total Amount/Net Income
Executive Officers	President	Kun Yen Lee	0	34,379	34,379	0.197%
	Chief Executive Vice President	Y.F. Chang
	Executive Vice President	Doris Wu
	Vice President	C.M. Chen
	Vice President	W.K. Chou
	General Plant Manager	Z.P. Chang
	Senior Assistant Vice President	T.L. Yu
	DeputyChief Auditor	W.H. Yeh
	Special Assistant of President Office	T.M. Chen
	Manager of AccountingDept.	H.Y. Kao
	Assistant Vice President	Dana Lee
	Assistant Vice President	Karen Yang

The 2020 managers’ remunerations have been approved by the BOD and will be reported to 2020 Shareholders’ Meeting.

3.2.8 Name and Title of the Top 10 Employees Who Were Distributed Employees Remuneration

Unit: NT ＄ 1000

Rank	Title	Name	Stock Bonus	Cash Bonus	Total Amount
1	President	Kun Yen Lee	0	30,397	30,397
2	Executive Vice President	Doris Wu
3	Chief Executive Vice President	Y.F. Chang
4	General Plant Manager	Z.P. Chang
5	Vice President	T.L. Yu
6	Vice President	C.M. Chen
7	Vice President	W.K. Chou
8	DeputyChief Auditor	W.H. Yeh
9	Special Assistant of President Office	T.M. Chen
10	Manager of AccountingDept.	H.Y. Kao

The employees’ remuneration comes from the profits of 2019.
Doris Wu and T.L. Yu are also responsible for ACC (China) affairs.

3.3 Implementation of Corporate Governance

3.3.1 Board of Directors

There are 6 meetings of the Board of Directors held in the period from January 1, 2019 to May 12, 2020. Directors’ attendance condition was as follows:

Title	Name	Name	~~Attendance~~ in Person	~~By~~ Proxy	~~Attendance~~ Rate	Notes
Chairman	Douglas Tong Hsu		6	0	100%	Reappointment Jun.27, 2017
Director	Representatives of Far Eastern New Century Corp.	Tsai Hsiung Chang	6	0	100%	Reappointment Jun.27, 2017
		Johnny Shih	6	0	100%	Reappointment Jun.27, 2017
		C.V. Chen	6	0	100%	Reappointment Jun.27, 2017
Director	Representative of Yue Ding Industry Co., Ltd.	Kun Yen Lee	6	0	100%	Reappointment Jun.27, 2017
Director	Representatives of Far Eastern Y.Z. Hsu Science and Technology Memorial Foundation	Peter Hsu	5	1	83%	Reappointment Jun.27, 2017
		Chen Kun Chang	6	0	100%	Reappointment Jun.27, 2017
Director	Representative of Ta Chu Chemical Fiber Co.,Ltd	Ruey Long Chen	5	1	83%	Reappointment Jun.27, 2017
Director	Representative of Huey Kang Investment Corp.	Connie Hsu	6	0	100%	Reappointment Jun.27, 2017
Director	Far Eastern Medical Foundation	Champion Lee	6	0	100%	Newly-elected Jun.27, 2017
Director	Bai-Yang Investment Holdings Corp.	Chin-Der Ou	6	0	100%	Newly-elected Jun.27, 2017
Director	U-Ming Corp.	Kwan-Tao Li	6	0	100%	Newly-elected Jun.27, 2017
Independent Director	Ta-Chou Huang		5	1	83%	Reappointment Jun.27, 2017
	Chi Schive		6	0	100%	Reappointment Jun.27, 2017
	Gordon S. Chen		6	0	100%	Reappointment Jun.27, 2017

Each Board of Directors Meeting has at least 2 independent director who attended the meeting in person, which meets the requirements of Article 7 of the Regulations Governing Procedure for Board of Directors Meetings of Public Companies

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3.3.2 Other mentionable items:

1. Board of Directors

A. Items listed in the Article 14-3 of the Securities Exchange Act: Please refer to 3.3.12 Major Resolutions of Shareholders’ Meeting and Board Meetings
B. Except for the above matters, the three independent directors of the Company gave us valuable opinions with no objections or reservations on all discussed matters. The directors' statements were all set out in the minutes of the board meeting.
If there is Directors’ avoidance of motions in conflict of interest, the Directors’ names, contents of motions, causes for avoidance and voting should be specified: None for the period from 2019.01.01.~2020.05.12.
The implementation of the Board evaluation:

Evaluation frequency Evaluated period Evaluation scope Evaluation method Every year 2019.01.01~ The Board and Self-evaluation 2019.12.13 members Evaluation content: ○1 mission and goal, ○2 internal control and risks, ○3 management of internal relations, ○4 management of external relations, ○5 the composition and capabilities of the BOD, ○6 board culture, ○7 the operation of the BOD, ○8 evaluation by the chairman, ○9 directors' self-evaluation.

Measures taken to strengthen the function of the Board:

Goals :

To enhance corporate governance and the function of the Board by enacting “the Procedures for Evaluating the Board of Directors’ Performance”

Implementation Status and Assessment:

A. The Board enacted “the Procedures for Evaluating the Board of Directors’ Performance” on May 13, 2015 and disclosed on the Company’s website.
B. Secretarial Department reviewed the Self-Assessment Questionnaire of the Board and calculated a weighted average score, and reported to the Board on May 12, 2020. The 2019 performance evaluation score was 96 points. The slight difference with past years is determined by the number of board meetings.
C. The score of 2019 evaluation falls between 3.40~3.73, compared to 4 points as full score indicating good performance.
D. In the past years, the score of evaluation has remained on high level, which is due to the fact that members of the board of directors attach importance to assessment indicators and assessment standards and cooperate with implementation. It is helpful to further implement the Company's corporate governance and enhance the board's functions.
E. The Corporate Governance Officer and Secretarial Department faithfully plays the role of reminding directors to follow regulations and is respected by the directors.

3.3.3 Annual priorities of Audit committee

The Audit Committee is designed to assist the Board in fulfilling its quality and integrity in overseeing the Company's accounting, auditing, financial reporting processes and financial controls.

The annual priorities reviewed by the Audit Committee mainly include: financial statements; audit and accounting policies and procedures; internal control systems and related policies and procedures; significant assets or derivatives transactions; major loans, endorsements or guarantees; raising or issuing securities; derivative products and cash investments; compliance;

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potential conflicts of interest for managers and directors; complaint report; fraud prevention and fraud investigation report; information security; company risk management; CPA independence and performance evaluation; appointment, dismissal or remuneration of CPA; appointment and dismissal of financial, accounting or internal audit managers; and other major matters prescribed by laws and regulations.

According to the laws, members of the Audit Committee shall be composed of all independent directors. The members of the Audit Committee of the Company has complied with the above-mentioned laws.

The Audit Committee of the Company fully understands that in order to perform its duties, it has the right to conduct any appropriate audits and investigations, and has direct communication with the Company's internal auditors, CPA, and all employees. At the same time, the Audit Committee also understands it has the right to hire and supervise lawyers, accountants or other consultants to assist the Audit Committee in performing its duties.

Please refer to the Company's website for the organization and working procedures of the Audit Committee of the Company.

3.3.4 Attendance of Audit committee

There are 6 meetings of the Audit committee held in the period from January 1, 2019 to May 11, 2020. Independent directors’ attendance condition was as follows:

Title	Name	~~Attendance~~ in Person	~~Attendance~~ Rate	Notes
Convener	Ta-Chou Huang	6	100.00%	-
Member	Chi Schive	6	100.00%	-
Member	Gordon S. Chen	6	100.00%	-

Other mentionable items:

1. Items listed in Article 14-5 of the Securities Exchange Act:

Meeting date	Items	Items listed in Article 14-5 of the Securities Exchange Act:	The resolution of the audit committee's and the Company's handling
2019/03/19	Audit report of 2018 Q4.	V	All members present at the meeting agreed to pass the items and submitted it to the board of directors in which all attended
	Cross Currency Swap (CCS)Report	V
	Acquisitionand disposalof fixed assets	V
	Report of endorsements/ guaranteeswith affiliates	V
	In order to raise working capital, the Company applied for credit from financial institutions.	V
	2018 consolidated financial report and individual financial report	V
	2018dividend distribution	V
	Appointment of accountants auditing the financial statements for 2019and their service fee	V

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	Approval to 2018 "Internal Control System Statement"	V
	To amend InternalControlSystem	V
	To amendAccounting System	V
	Issuance of Long-termCommercialpaper	V
	Proposed to issue medium and long-term unsecured commercial paper with total amount not exceeding NT$10 billion in order to repay the loan, enrich the medium and long-term working capital, and strengthen the financial structure.	V
	Proposed to issue unsecured corporate bonds in once or in a batch with total amount not exceeding NT$10 billion in order to repay the loan, enrich the medium and long-term working capital, and strengthen the financial structure.	V
	To issue a letter of support for the Company’s subsidiary, Chiahui Power Corp., for 20-year-term NT$10.5billion syndicated loan.	V
	To amend “Procedure for Acquisition and Disposal of Assets”	V
	To amend “Procedure for Making Endorsements and Guarantees”.	V
	To amend “Procedure for Loan toOthers”.	V
2019/05/10	Auditreport of 2019 Q1	V
	Consolidatedfinancial report of 2019 Q1	V
	Acquisition and disposal of fixed assets	V
	Report of endorsements/ guaranteeswith affiliates	V
	In order to raise working capital, the Company applied for credit from financial institutions.	V
	Report the Company’sissued2019 corporationbond	V
	Report theCompany's 2018annual business report	V
2019/08/01	Audit report of 2019 Q2	V
	Acquisition and disposal of real estate, equipment or right-of-use assets	V
	Report of endorsements/ guaranteeswith affiliates	V
	Revision of the Company's "Internal Control System" and "Internal Audit System and Implementation Rules"	V
2019/11/06	Audit report of 2019Q3	V
	Consolidatedfinancial report of 2019 Q3	V
	Acquisition and disposal of real estate, equipment or right-of-use assets	V
	Report ofendorsements / guarantees withaffiliates	V
	The implementation report of the Company's second unsecured corporate bondin 2019	V
	2019auditplan	V
	Revision of the Company's "Internal Control System" and "Internal Audit System and Implementation Rules"	V

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	Proposed to issue unsecured corporate bonds in once or in a batch with total amount not exceeding NT$10 billion in order to repay the loan, enrich the medium and long-term working capital, and strengthen the financialstructure.	V
2019/03/25	Audit report of 2019 Q4.	V
	The company reiterates its ability to prepare its own financial reports	V
	Acquisition and disposal of real estate, equipment or right-of-use assets	V
	Report of endorsements/ guaranteeswith affiliates	V
	Acquisition and disposal of securities.
	In order to raise working capital, the Company applied for credit from financial institutions.	V
	2019 consolidated financial report and individual financial report	V
	2019 dividend distribution	V
	Appointment of accountants auditing the financial statementsfor 2019	V
	Approval to 2019 "Internal Control System Statement"	V
	To amend the2019 audit plan	V
	Proposed to issue medium and long-term unsecured commercial paper with total amount not exceeding NT$20 billion in order to repay the loan, enrich the medium and long-term working capital, and strengthenthefinancialstructure.	V
	To amend “Articles of Incorporation of Asia Cement Corporation”	V
	To amend “Meeting Rules for Shareholders’ Meeting”	V
	To amend “Meeting Rules for Board of Directors’ Meeting”	V
	To amend “Principles for Ethical Management of Asia Cement Corporation”	V
2020/05/11	Audit report of 2020 Q1	V
	Consolidated financial report of 2020 Q1
	Acquisition and disposal of real estate, equipment or right-of-use assets	V
	Report of endorsements/ guaranteeswith affiliates	V
	In order to raise working capital, the Company applied for credit from financial institutions.	V
	The implementation report of the Company's first unsecured corporate bond in 2020	V
	Report the company's 2019annual business report	V

There are no other matters that did not pass the audit committee and agreed by more than two-thirds of all directors.

If there is Independent Directors’ avoidance of motions in conflict of interest, the Independent Directors’ names, contents of motions, causes for avoidance and voting should be specified:

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None.

None.	None.	None.
3. Communications with internal audit manager and CPA: (1) Internal audit manager reports the plans and execution of audit works to Independent Directors every quarter and implement the instructions and follow-up of each independent director. (2) CPA and accounting manager report financial and operation business to Independent Directors every quarter
Meeting date	Items discussed with internal auditor	Items discussed with CPA
2019/03/19	1. Audit report of 2018 Q4. 2. Approval to 2018 "Internal Control System Statement" 3. To amend the 2018 audit plan	1. The 2018 individual and consolidated financial statements 2. Assessment of accounting professional judgment, accounting policies and estimation changes. 3. Communication of key check matters. 4. The impact of the new laws and accounting standards on the Company. 5. Other.
2019/05/10	Audit report of 2019 Q1	1. The results of 2019 Q1 consolidated financial statements. 2. The impact of the new accounting standards on the Company. 3. Regulations update.
2019/08/01	Audit report of 2019 Q2	1. The results of 2019 H1 consolidated financial statements. 2. Other communication matters. 3. Regulations update.
2019/11/05	Audit report of 2019 Q3	1. Declaration of independence. 2. The scope and method of review. 3. Group review. 4. Major accounting policies, major accounting estimates, major events, and major transactions 5. Other communication matters. 6. Annual auditing plan (key audit items,significant risks).
2019/03/23	Audit report of 2019 Q4	1. Declaration of independence. 2. The scope and method of review. 3. Group review. 4. Major accounting policies, major accountingestimates,

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Meeting date	Items discussed with internal auditor	Items discussed with CPA
		major events, and major transactions 5. Key reviewing matters. 6. Other communication matters.
2020/05/11	Audit report of 2020 Q1	1. Declaration of independence. 2. The scope and method of review. 3. Group review. 4. Major accounting policies, major accounting estimates, major events, and major transactions 5. Othercommunication matters.

The three independent directors of the Company gave us valuable opinions with no objections or reservations on all discussed matters. The directors' statements were all set out in the minutes of the Audit Committee meeting.

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3.3.5 Corporate Governance Execution Status and Deviations from “Corporate Governance Best-Practice Principles for TWSE/ TPEx Listed Companies”

Listed Companies”
Evaluation Item	ImplementationStatus			Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
1. Does the company establish and disclose the Corporate Governance Best-Practice Principles based on “Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”?	V		The Company has established the Corporate Governance Codes with reference to “Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” on Nov. 11, 2014. The information has been disclosed on MOPSand theCompany’swebsite.	None
2. Shareholding structure & shareholders’ rights (1) Does the company establish an internal operating procedure to deal with shareholders’ suggestions, doubts, disputes and litigations, and implement based on the procedure? (2) Does the company possess the list of its major shareholders as well as the ultimate owners of those shares?	V V		The Company has appointed spokesman or his deputy as well as stock agency, Oriental Security Corporation, to handle these issues. If involved in litigation matters, the spokesman will handle that with the Secretarial Department, and legal staff. If significant event happens, legal consultants, Lee and Li, and accounting consultants, Deloitte & Touche, will help deal with the matter. This complies with our internal operating procedures. The Company keeps tracking the list of shareholders and follows the Article 3 of Market Information Post Regulation Reporting by Listed Companies to post related information before 31th July.	None None

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Evaluation Item	ImplementationStatus	ImplementationStatus	ImplementationStatus	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx ListedCompanies” and Reasons
	Yes	No	Abstract Illustration
(3) Does the company establish and execute the risk management and firewall system within its conglomerate structure? (4) Does the company establish internal rules against insiders trading with undisclosed information?	V V		In addition to enacting “Regulations for Monitoring Subsidiaries” as the risk management mechanism for its subsidiaries, the Company has also enacted “Regulations for Managing Client’s Credit” and assigned the Credit Committee to be responsible for risk control of accounts receivable. Meanwhile, to establish risk management and firewall, we have signed up with affiliates for “Procedures of Assets Acquisition and Disposal”, “Procedures for Loaning of funds to Others”, “Procedures for Endorsement and Guarantee,” and “Rules on the Management of Related Party Transaction.” The Auditing Department will report regularly to the Board of Directors and Audit Committee about any abnormal conditions and their improvements. The Auditing Department will also report to the Financial Supervisory Commission and other government agencies in accordance with relevant regulations. The Board of Director approved “the Procedure Dealing with Internal Material Information of Asia Cement Corporation” on Dec. 21, 2009, and revised it on Aug. 10, 2017. It states that “directors, supervisors, managers and other employees shall not disclose internal material information to others, nor involve in any transaction of the Company’s stock or anyother	None None

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Evaluation Item	ImplementationStatus	ImplementationStatus	ImplementationStatus	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx ListedCompanies” and Reasons
	Yes	No	Abstract Illustration
			forms of security.” The Procedure has been post on the Company’s website and internal bulletin board.
3. Composition and Responsibilities of the Board of Directors (1) Does the Board develop and implement a diversified policy for the composition of its members?	V		The Board members considered its member diversification and approved “strengthening the function of the Board” Section of “the Corporate Governance Codes”. The Company adopts candidate nomination system for the election of directors. In addition to the assessment of each candidate's education and experience, opinion of the stakeholder and full compliance with “the election rules for directors " and “Corporate Governance Codes” are also considered. In the members of the 26thBoard of Directors, except for one female member, there are members who have abilities of leadership, operation analysis, management, crisis management, industry knowledge and international view, such as Douglas Tong Hsu, Tsai Hsiung Chang, Johnny Shih, Peter Hsu, Kun Yen Lee, and Chen Kun Chang. Members who represent public welfare is Connie Hsu. C.V. Chen and Kwan-Tao Li specialize in legal matters. Ruey Long Chen served as Minister of Economy. Chin-Der Ou served as vice mayor of Taipei City. As for independent directors,	None

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Evaluation Item			ImplementationStatus	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
(2) Does the company voluntarily establish other functional committees in addition to the Remuneration Committee and the Audit Committee?	V		Ta-Chou Huang Chi Schive, and Gordon S. Chen, they are expert in administrative management and financial matters. It is also mentionable that Ta-Chou Huang had served in agriculture affair for the government. He gave us many advices in green vegetation and environmental protection of plants and mines. In summary, the present members of the Board do have diversity. The diversified policy for the composition of the Board of Directors has been disclosed on the Company’s website and MOPS. The Company has established Remuneration Committee and Audit Committee pursuant to government regulations. Other voluntarily established functional committees are: Human Resource Committee: Review and advice to modify the Company’s organization structure, rules of personnel management, and other important human resource matters with reference to the Universal Declaration of Human Rights and International Labor Conventions. Credit Committee: Execute “Regulations for Managing Client’s Credit” enacted by the Company and take charge of risk control of account receivable.	None

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Evaluation Item			ImplementationStatus	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
(3) Does the company establish a standard to measure the performance of the Board, and implement it annually?	V		CSR Committee: Responsible for investigating and identifying corporate sustainability issues and to respond major considerations of stakeholders in order to implement the goal of sustainable development. IT Steering Committee: Review all affairs relating to information operation system, office automation, internal and external website applications and information security to the needs of operation, management and provide strategy to prevent the risk of information security and its efficiency. The company enacted “Procedures for Evaluating the Board’s Performance” on May 13, 2015 and conducts it annually. Evaluation methods: 1. Self-assessment of Board members Board members fill in the” Self-Assessment Questionnaire for Board Members” at the end of each year. 2. Assessment by Secretarial Department: Secretarial Department will evaluate evaluation items at the end of each year and modify evaluation items if needed. 3. Procedures: a. regularly review the effectiveness of the evaluation. b. at the end of eachyear,Secretarial	None

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Evaluation Item	ImplementationStatus	ImplementationStatus	ImplementationStatus	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
			Department will review the Self-Assessment Questionnaire and evaluation items, calculate a weighted average score, and report to the Board of Directors. 4. Implementation: At the beginning of each year, Secretarial Department will remind every Board’s member about items in the Self-Assessment Questionnaire and other issues, such as “recognition and discussion issues of the Board in accordance with law, "Quarterly meeting requirement of the Board", "rules regarding to conflicts of interests of Directors", "the minimum annual training hour of directors", and “to enhance attendance rate of board of directors and shareholders meeting”. 5. Secretarial Department reviewed the Self-Assessment Questionnaire of the Board and calculated a weighted average score, and reported to the Board on May 12, 2020. The Company's corporate governance department is studying whether the board's performance evaluation to be evaluated externally. 6. Although the results of performance evaluation will not affect the remuneration of individual directors,it will be used as a

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Evaluation Item	ImplementationStatus	ImplementationStatus	ImplementationStatus	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
(4) Does the company regularly assess the independence of accountants?			reference for nomination renewal, especially the attendance rate 7. The Procedures for Evaluating the Board of Directors’ Performance has been disclosed on the Company’s website. 1. The Company appointed Li Wen Kuo and Yu Wei Fan of Deloitte & Touche to audit 2018 financial statements. The independence assessment of these two CPAs was based on Article 47 of the Accountants Law and related regulations. The result has been approved on March 19, 2018 and Marh 23, 2018 by the Audit Committee and Board of Directors. 2. In 2019, due to internal function adjustments in Deloitte & Touche-Taiwan, it adjusted the Company’s CPA to Xin Wei Tai and You Wei Fan. The independent assessment and qualifications of the CPA have been submitted to the Audit Committee on March 19, 2019 and the Board of Directors on March 20. 3. The Audit Committee and the Board of Directors meeting will regularly in March eachyear to assess the independence of CPAs.	None
4. Does the company establish specialized units or dedicated members and personnel responsible for corporate governance affairs, as well as carrying out key actions and reporting statuses (e.g. : includingbut not limited toprovide the	V		1. On May 10, 2019, the Board of Directors appoints Vice President, Wei Kun Chou of the Secretarial Dept. as the Corporate Governance Officer. The secretarial Dept. serves as the secretaryof the board of directors topromote	None

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Evaluation Item	ImplementationStatus	ImplementationStatus	ImplementationStatus	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
information that board directors and supervisors request to perform their duties, ensuring the general affairs of board meetings and shareholders’ meetings are held in accordance with regulations, applying and changing of company registration, and taking meeting minutes for board meetings and shareholders’ meetings.)			corporate governance. Each member of the Secretarial Dept. has more than 20 years' working experience in the management of legal affairs and board affairs. 2. 2. The main responsibilities are as follows:  Convene internal corporate governance regulations seminars twice a year.  Develop company and organizational structure to promote the independence of the board of directors, transparency, corporate governance, and internal control.  Plan to convene the Board of Directors and Audit Committee and their agenda at least prior 7 days before the meetings with sufficient meeting information to facilitate the directors to understand the contents of the relevant issues and conflict of interests in advance.  To registry the date of the shareholders' meeting every year, and to issue the meeting notice, annual report and handbook in both English and Chinese. The relevant documents shall be approved by the vice president and president.  To survey the Board’s performance evaluation and report to the board of directors annually. 3. Training hours for Corporate Governance Officer have been declared to MOPS

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Evaluation Item	ImplementationStatus	ImplementationStatus	ImplementationStatus	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
			accordingto the regulations.
5. Does the company establish a communication channel and build a designated section on its website for stakeholders, as well as handle all the issues they care for in terms of corporate social responsibilities?	V		The Company provides “Stakeholder Area” section of the Company’s website for the communication channel with shareholders and stakeholders with respect to any CSR issues. http://www.acc.com.tw/	None
6. Does the company appoint a professional shareholder service agency to deal with shareholder affairs?	V		The Company designates stock agency, Oriental Security Corporation, to deal with shareholder affairs.	None
7. Information Disclosure (1) Does the company have a corporate website to disclose both financial standings and the status of corporate governance? (2) Does the company have other information disclosure channels (e.g. building an English website, appointing designated people to handle information collection and disclosure, creating a spokesman system, webcasting investor conferences)?	V V		The Company has set up a Chinese/English website (www.acc.com.tw) to disclose information regarding the Company’s financials, business and corporate governance status. The Company has assigned a spokesman or his deputy to handle information collection and disclosure. The Company will also convene the institutional investors’ conference upon request and post relevant information on MOPS and ACC website. Please refer to Section 3.3.5 8(2) Investor Relations of this Annual Report.	None None
8. Is there any other important information to facilitate a better understanding of the company’s corporate governance practices (e.g., including but not limited to employee rights, employee wellness, investor relations,supplier relations,rights of stakeholders,	V		(1) Status of employee rights and employee wellness: Please refer to the “Section 5.5 Labor Relation” of this Annual Report. (2)Investor Relations:	None

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Evaluation Item	ImplementationStatus	ImplementationStatus	ImplementationStatus	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
directors’ and supervisors’ training records, the implementation of risk management policies and risk evaluation measures, the implementation of customer relations policies, and purchasing insurance for directors and supervisors)?			For the efficient communication between investors and the Company, in addition to the spokesman or his deputy, the Company specifies its Finance Department to serve as investor relation contact. Moreover, the Company will attend or hold investor conference if necessary. In order to ensure the information symmetry of disclosure, the Company will post relevant information and materials to MOPS and the Company's website. (3) Supplier relations: The Company regards our suppliers as partners. Except requiring good service, high quality, and reasonable prices to our suppliers, the Company also brings our construction contractors into its safety management system, and set up safety regulations for contractors, such as access control and issuing construction permission, and holds training courses to help contractors fulfill safety requirements. (4) Stakeholders’ Rights: For the transparency and timely disclosure of the Company, the information of finance, business, and corporate governance could be accessed on the Company’s website and MOPS in both Chinese and English. (5)The trainingfordirectors:

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Evaluation Item	ImplementationStatus	ImplementationStatus	ImplementationStatus	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
			Please refer to section 3.3.8 for detail. (6) Risk managements and assessments: Based on the principles of “protecting assets, promote interests, reducing damages and ensuring sustainable development" of the Company, the Company forms its company organization with functions of risk management. Please refer to section 3.1.2 for detail. Besides of routine business goals, each departments of the Company would timely adjust to rapidly-changing world for risk management. (7) Customer policy: The Company serves its customers with the principles of “good service, high quality, and reasonable prices, and customer-oriented”. The Company will also meet all customers’ need by stringent quality control. (8) Responsibility insurance purchase for directors and supervisors: On November 8, 2019, the Board of Directors agreed to renew the liability insurance for directors, and supervisors, and important employees of the Company and affiliates in the consolidated financial statements, and it took effect on December 1,2019.

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Evaluation Item	ImplementationStatus	ImplementationStatus	ImplementationStatus	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
9. Base on the result of ”Corporate governance Evaluation” announced by TWSE ( Taiwan Stock Exchange Corporation) in a recent year to illustrate the status of matters have been already improved and priority measures to reinforce matters haven’t been improved：	V		The Company was ranked 6%~20% in “the 2019 Corporate Governance Evaluation” by the TWSE. This year will focus on improving non-scored items: whether the company website or annual report exposes the integrity management policy, as well as the specific practices and prevention of dishonesty. Improvement: The Board of Directors has amended the company's code of integrity management on March 25, 2020, and instructed Corporate Governance Officer and HR Dept. to report to the BOD regularly with education and trainingissues.	None

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3.3.6 The Composition, Duty, and Implementation Status of the Remuneration Committee

1. Professional Qualifications and Independence Analysis of Members of the Remuneration Committee

Position1	Criteria Name	Meet One of the Following Professional Qualification Requirements, Together with at Least FiveYears Work Experience	Meet One of the Following Professional Qualification Requirements, Together with at Least FiveYears Work Experience	Meet One of the Following Professional Qualification Requirements, Together with at Least FiveYears Work Experience	Independence Criteria2	Independence Criteria2	Independence Criteria2	Independence Criteria2	Independence Criteria2	Independence Criteria2	Independence Criteria2	Independence Criteria2	Independence Criteria2	Independence Criteria2	Number of Other Public Companies in Which the Individual is Concurrently Serving as an Members of the Remuneration Committee	Note3
		An Instructor or Higher Position in a Department of Commerce, Law, Finance, Accounting, or Other Academic Department Related to the Business Needs of the Company in a Public or Private Junior College, College orUniversity	A Judge, Public Prosecutor, Attorney, Certified Public Accountant, or Other Professional or Technical Specialist Who has Passed a National Examination and been Awarded a Certificate in a Profession Necessary for the Business ofthe Company	Have Work Experience in the Areas of Commerce, Law, Finance, or Accounting, or Otherwise Necessary for the Business of the Company	1	2	3	4	5	6	7	8	9	10
Independent Director	Chi Schive	V		V	V	V	V	V	V	V	V	V	V	V	1	Yes
Independent Director	Ta-Chou Huang	V		V	V	V	V	V	V	V	V	V	V	V	1
Other	M.X. Lin			V	V	V	V	V	V	V	V	V	V	V	1	-

The term of the Remuneration Committee started on June 27, 2017.
According to Art. 12 of Taiwan Stock Exchange Corporation Operation Directions for Compliance with the Establishment of Board of Directors by TWSE Listed Companies and the Board's Exercise of Powers, the number of remuneration committees shall not be less than three, and more than half of the members shall be independent directors. The Board of Directors changed the members of the Remuneration Committee on May 10, 2019. The current remuneration committee is composed of two independent directors, Chi Schive and Ta-Chou Huang.

Note1: Please specify the members’ position: director, independence director or others.

Note2: Please tick the corresponding boxes if each member has been any of the following during the two years prior to being elected or during the term of office.

Not an employee of the company or any of its affiliates.
Not a director or supervisor of the company or any of its affiliates. Not apply to independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent.
Not a natural-person shareholder who holds shares, together with those held by the person's spouse, minor children, or held by the person under others' names, in an aggregate of one percent or more of the total number of issued shares of the company or ranking in the top 10 in holdings.
Not a spouse, relative within the second degree of kinship, or lineal relative within the third degree of kinship, of a managerial officer under subparagraph 1 or any of the persons in the preceding two subparagraphs.
Not a director, supervisor, or employee of a corporate shareholder that directly holds five percent or more of the total number of issued shares of the company, or that ranks among the top five in shareholdings, or that designates its representative to serve as a director or supervisor of the company under Article 27, paragraph 1 or 2 of the Company Act. Not apply to independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent.
If a majority of the company's director seats or voting shares and those of any other company are controlled by the same person: not a director, supervisor, or employee of that other company. Not apply to independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent.
If the chairperson, general manager, or person holding an equivalent position of the company and a person in any of those positions at another company or institution are the same person or are spouses: not a director (or governor), supervisor, or employee of that other company or institution. Not apply to independent directors

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appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent.

Not a director, supervisor, officer, or shareholder holding five percent or more of the shares, of a specified company or institution that has a financial or business relationship with the company. Not apply to independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, a public company and its parent or subsidiary or a subsidiary of the same parent, if the specified company or institution holds 20 percent or more and no more than 50 percent of the total number of issued shares of the public company.
Not a professional individual who, or an owner, partner, director, supervisor, or officer of a sole proprietorship, partnership, company, or institution that, provides auditing services to the company or any affiliate of the company, or that provides commercial, legal, financial, accounting or related services to the company or any affiliate of the company for which the provider in the past 2 years has received cumulative compensation exceeding NT$500,000, or a spouse thereof; provided, this restriction does not apply to a member of the remuneration committee, public tender offer review committee, or special committee for merger/consolidation and acquisition, who exercises powers pursuant to the Act or to the Business Mergers and Acquisitions Act or related laws or regulations.
Not been a person of any conditions defined in Article 30 of the Company Law.
Note3: If the member is a director, please specify whether he/she fulfills the qualification set in the paragraph 5, Article 6 of the “Regulations Governing the Appointment and Exercise of Powers by the Remuneration Committee of a Company Whose Stock is Listed on the Stock Exchange or Traded over the Counter.”

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2. Implementation Status of the Remuneration Committee

There are 3 members of the Remuneration Committee. Their terms of office start from June 27, 2017 to June 26, 2020. Totally, 2 meetings of the Remuneration Committee were held in the latest year. Members’ attendance condition was as follows:

Position	Name	Attendance in Person	Attendance in Proxy	Attendance rate	Notes
Convener	Chi Schive	2	0	100	Incumbent
Member	Ta-Chou Huang	2	0	100	Incumbent
Member	M.X. Lin	2	0	100	Incumbent
Other mentionable items: 1. If the board of directors declined to adopt, or modified a recommendation of the Remuneration Committee, please specify the date, term, content, resolution, and the Company’s processing situations for Remuneration Committee’s resolution: None. Meeting Date Discussion item ApproveOpinion processing situations 2019/03/18 President and vicepresident's 2018performance evaluation V All members present ~~a~~t the meeting agreed to pass the items ~~w~~ithout objection. . 2018 directors' and employees’ remuneration V President and vice president's 2019 performance evaluation items V 2019/11/05 2018 directors', president’s, and vice presidents' remuneration, and the situation of the cement industry V 2. If any objections or reservations expressed by any committee member in record or in written to Remuneration Committee’s resolution, please specify the date, term, content, and the committee’sprocessingsituations for objections or reservations: None.

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3.3.7 Corporate Social Responsibility

Evaluation Item			Implementation Status	Deviations from “the CSR Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
1. Does the company assess ESG risks associated with its operations based on the principle of materiality, and establish related risk management policies or strategies?	V		The Company enacted “Corporate Social Responsibility Policy” on Nov. 11, 2014 and published first CSR report on Dec. 2014. These have been disclosed on the Company’s website. The CSR Committee (operated by the Secretarial Department) will report to the Board on May and November about the implement status and review of the CSR policy. The Company also briefed to the shareholders' meeting held on June 26, 2018 on the CSR implement plans and its results which is disclosed in the Company's website and CSR Report. The Company's corporate social responsibility policy and CSR report have been disclosed on the Company's website. After the mining rights extension of the Hualien Plant was approved, it caused dissatisfaction of environmental groups and misunderstandings of the indigenous tribes. After 3 years of communication, there has been a goodwill feedback on "home security" and "truth investigation".	None
2. The company establishes exclusively (or concurrently) dedicated units to be in charge of proposing and enforcing the corporate social responsibility policies.	V		CSR Committee established on Nov. 11, 2014 and is responsible for investigating and identifying CSR issues (operated by the Secretarial Department). The CSR Committee will report to the Board on May and November about the implement status and review of the CSR policy. The Secretarial Department will report the effectiveness aboutCSR activitytwice ayear.	None
3.Fostering a Sustainable Environment (1)The company establishes proper environmental management systems based	V		In November 1996, the Hualien plant of the Company became one of the first organizations in Taiwan to receive ISO-14001 certification. This management system was completed bythe Hualienplantpersonnel itself based on the	None

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on the characteristics of their industries.		Plant’s good practice on environmental protection, and this has turned the Plant into a role model of Eco-friendlycement manufacturer.
(2)The company endeavors to utilize all resources more efficiently and uses renewable materials which have a low impact on the environment.	V	For many years, the Company is devoted to enhance its utilization efficiency of resources and to use renewable materials, such as slag and gypsum from steelworks and power plants. This can greatly reduce the need for natural resources.	None
(3)The company establishes dedicated units or assigns dedicated personnel for environment management to maintain the environment.	V	The Hualien plant was the pioneer for implement ISO 14064-1 greenhouse air emission inspection since 2003. The Plant was awarded “Excellent Company for Voluntary Reduction of Greenhouse Gas Emissions” in 2009, 2011, 2013, 2015, 2016, and 2017 by the Industrial Development Bureau, MOEA. Please refer to our CSR report for more information.	None
(4)The company monitors the impact of climate change on its operations and should establish company strategies for energy conservation and carbon and greenhouse gas reduction.	V	Please refer to our CSR report for more information.	None
4. Social issues (1) Does the company formulate appropriate management policies and procedures according to relevant regulations and the International Bill of Human Rights?	V	The Company complies with all national regulations and international labor human rights norms, including international labor conventions, the UN Universal Declaration of Human Rights and other norms. The Company also formulates policies that are in line with business ethics, environmental, social issues, human rights and other public policy. Implements status is disclosed in annual reports, CSR report, or the Company’s website. 1. The Company fully complies with Labor Standards Law and other regulations, emphasizes the balance between working, family and leisure life, and prohibits child labor and all other forms of forced labor and discrimination. 2. Inorderto establisha genderequality workplace, the Company provides	None

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			childcare leave, family care leave, physiology leave, maternity leave, paternity leave, and breastfeeding room. 3. Every year, the Company arranges employee health examinations, holds health seminars, and promotes the employee assistance program (EAP). For details, please refer to the 5.5 Labor Relations and the CSR Report. 4. Human Resource Committee of the Company follows the provisions of Article 18, Item 2 of the Code of Practice for Corporate Social Responsibility, formulates the human rights policy of the Company, and regularly evaluates the impact of the Company's operating activities and internal management on human rights, and has corresponding procedures. 5. Specific management plan: The Company provided training on human-rights related issues in 2019 (including corporate social responsibility in human rights practice, cross-cultural communication and understanding, labor education, health management and mental health related courses) with total55courses for 120hours and 1,410trainees.
(2) Does the company have reasonable employee benefit measures (including salaries, leave, and other benefits), and do business performance or results reflect on employee salaries?	V		Article 25 of the Company's AOI stipulates that: if the Company makes a profit in the year, it shall allocate 1.0% to 4.0% as employee remuneration. The remuneration policy clearly states that employee remuneration includes performance bonuses, and the calculation of the bonus is based on the Company ’s operating performance for the year. 1. When formulating the remuneration system, the Company will be equal regardless of gender, age, race, socioeconomic class, religion, and marital and family status, except for education level, work experience, license and professional skills. 2. In order to plan a fair and reasonable remuneration system, the Company also participates in market salary surveys every year to ensure that the Company's employees are ranked among the best in the industry. ※In 2019, the Company was renewed as a constituent stock of the "Taiwan High Salary 100 Index" by the stock exchange. 3. Thanks to the rational participation of the labor unions of Hsinchu and Hualien plant for years in achieving the Company's remuneration policy. The Company and the Unions were awarded the "2013 Signed Group Agreement Outstanding Unit" issued by theMinistry of Labor	None

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		4. Employee performance, training and volunteer services are all included in the performance assessment of the "employee work rules", and there is a clear reward and punishment system. Please refer to the CSR report for a description of sustainable and happy workplace. 5. The company will consider the company's profitability every year, and make salary adjustments or promotions based on individual performance results.The average salary adjustmentrangeis1% to 3%.
(3) Does the company provide a healthy and safe working environment and organize training on health and safety for its employees on a regular basis?	V	Please refer to Section 5.5 “Labor Relation” for detail.	None
(4) Does the company provide its employees with career development and training sessions?	V	For employees’ career development and training sessions, in addition to relevant management skills, the Company provides systematic training courses to strengthen the employees’ abilities and enhance the competitiveness of both employees and corporation. Recently, the Company cooperates with Yuan Ze University to conducts employee career development training programs for a 2-years period. Pleasereferto ourCSR reportfor moreinformation.	None
(5)Do the company's products and services comply with relevant laws and international standards in relation to customer health and safety, customer privacy, and marketing and labeling of products and services, and are relevant consumer protection and grievance procedure policies implemented?	V	The Company has set up a standard operation procedure dealing with customers’ complaint and protects consumers’ health and safety. Besides, the Company will keep the transparency of information to meet customers’ need while consumers’ personal information will be kept security according to Personal Information Protection Act. All products and services of the Company are advertised and labeled according to relevant regulations and international standards. Asia Cement received CNS Mark for Portland Cement (Type 1) since Sep. 22, 1961. Thus, the Company received "Special Honor for CNS Mark" for using CNS Mark more than 50 years on Oct. 2011. The trademark of “Skyscraper Cement” of the Company is registered pursuant to the Trademark Law.	None

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			All authorized uses of “Skyscraper Cement” to our subsidiaries in China are approved by China’s Trademark Office of the State Administration for Industry and Commerce. The Company serves our customers with the principles of “customer-oriented good service, high quality, and reasonable prices”. To protect consumers’ rights, the Company sets up consumer services to manage consumers’ complaints from domestic and oversea clients. The Hsinchu and Hualien plants will manage our product quality to meet all customers’ need. Domestic and Foreign Sale Departments have set up "management practices for customer satisfaction" which establishes an effective communication channel for our clients.
(6) Does the company implement supplier management policies, requiring suppliers to observe relevant regulations on environmental protection, occupational health and safety, or labor and human rights? If so, describe the results.	V		Our Purchasing Department has "supplier evaluation procedures". Suppliers certified with ISO-9000, CNS marks, or other quality inspection mark will be rated as excellent suppliers. Furthermore, the Purchasing Department will assess the past impact of the supplier on CSR issues, such as ethics behaviors, legal compliance, matters relating to the health and security. This would be important basis for contractor selection. Please refer to Section 3.3.5 “Supplier relations” for detail. Upon the signing of any contract, the Company will require every supplier to follow labor laws, avoid environmental hazards, and commit to CSR policy. Whenever violation occurs, the Company has the right to terminate the contract. Please refer to ourCSR report for more information.	None
5. Does the company reference internationally accepted reporting standards or guidelines, and prepare reports that disclose non-financial information of the company, such as corporate social	V		The Company’s CSR report was prepared in accordance with the GRI Standards and verified by SGS Taiwan Limited in according with AA 1000 Assurance Standard.	None.

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responsibility reports? Do the reports above obtain assurance from a third party verification unit?

Describe the difference, if any, between actual practice and the corporate social responsibility principles, if the company has implemented such principles based on the Corporate Social Responsibility Best Practice Principles for TWSE/TPEx Listed Companies: None.
Other useful information for explaining the status of corporate social responsibility practices: Please refer to section 5.4 “Expenditures on Environmental Protection” and CSR report for more information.
CSR website: https://csr.acc.com.tw/en/

3.3.8 Implementation Status of Ethical Management

Evaluation Item			ImplementationStatus 1	Deviations from the “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies” and Reasons
	Yes	No	Abstract Illustration
1. Establishment of ethical corporate management policies and programs (1) Does the company have a Board-approved ethical corporate management policy and stated in its regulations and external correspondence the ethical corporate management policy and practices, as well as the active commitment of the Board of Directors and management towards enforcement of such policy?	V		1. “Codes of Ethical Conduct” and “Principles for Ethical Management” of Asia Cement Corporation have been adopted by Board of Directors on June 27, 2012 and reported to the 2013 shareholders’ meeting. “Principles for Ethical Management” was amended on March 25, 2020. 2. The Company has post “Codes of Ethical Conduct” and “Principles for Ethical Management” on the Company’s intranet for compliance. 3. The Company has also promoted “Codes of Ethical Conduct” and “Principles for Ethical Management” to its suppliers and contractors.	None

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Evaluation Item			ImplementationStatus1	Deviations from the “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies” and Reasons
	Yes	No	Abstract Illustration
(2) Does the company have mechanisms in place to assess the risk of unethical conduct, and perform regular analysis and assessment of business activities with higher risk of unethical conduct within the scope of business? Does the company implement programs to prevent unethical conduct based on the above and ensure the programs cover at least the matters described in Paragraph 2, Article 7 of the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies? (3) Does the company provide clearly the operating procedures, code of conduct, disciplinary actions, and appeal procedures in the programs against unethical conduct? Does the companyenforce theprograms above			The Company establish precautions for directors, managers, employees for preventing high-potential unethical conducts: 1. Set a standard distinguishing improper benefits, 2. Set procedures for political donations, 3. Set procedures for charity donations or sponsorship, 4. Set reporting and handling procedures to avoid job-related conflicts of interest, 5. Set an information firewall to prevent sensitive information or undisclosed information and to prevent the use of the non-disclosed information in insider trading, 6. Set working procedures dealing with dishonest actions involved by suppliers, customers, and trading partners and others, 7. Set working procedures dealing with violators of Principles for Ethical Management, 8. Set punishment for violators and reward for whistleblowers. For the purpose of developing a corporate culture of ethical management and preventing unethical conduct, HR Department enacted “Working procedures and Guidelines for Ethical Management”.It clearlyexpresses all kinds of bad

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Evaluation Item	ImplementationStatus1	ImplementationStatus1	ImplementationStatus1	Deviations from the “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies” and Reasons
	Yes	No	Abstract Illustration
effectively and perform regular reviews and amendments?			faith conducts, preventions, and punishments for violators. In order to implement the Company's “Codes of Ethical Conduct” and “Principles for Ethical Management”, the Board enacted “Working Procedures for Reporting Illegal, Unethical, and Dishonest Issues”, and also enacted "Complainant rules for employees”. Above mentioned rules are disclosed on the Company’s website (http://www.acc.com.tw/).
2. Fulfill operations integrity policy (1) Does the company evaluate business partners’ ethical records and include ethics-related clauses in business contracts? (2) Does the company have a unit responsible for ethical corporate management on a full-time	V		All suppliers of the Company signed "Codes of Conduct and Commitment Statement for Suppliers". We will review, rate, and eliminate our suppliers based on past evaluation records and their implementations of CSR affairs. For fully implementation, the Purchasing Department has urged all suppliers to comply with our “Codes of Ethical Conduct” and “Principles for Ethical Management”. The Purchasing Department will include this item into commercial terms. The HR Department is responsible for formulating policyand supervisingethical management for the	None

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Evaluation Item	ImplementationStatus1	ImplementationStatus1	ImplementationStatus1	Deviations from the “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies”andReasons
	Yes	No	Abstract Illustration
basis under the Board of Directors which reports the ethical corporate management policy and programs against unethical conduct regularly (at least once a year) to the Board of Directors while overseeing such operations? (3) Does the company establish policies to prevent conflicts of interest and provide appropriate communication channels, and implement it? (4) Does the company have effective accounting and internal control systems in place to implement ethical corporate management? Does the internal audit unit follow the results			Company. It will report the implementation status to the Board on a regular basis. In addition to report implementation status of ethical management to the Board, the HR Department will also report to independent directors. The Company provides that no manager shall engage in any affairs with conflicts of interest to the Company unless otherwise released restriction by the Board and the shareholders’ Meeting. All members of our Board of Directors are highly disciplined. Once there are conflicts of interests, such member will not participate in discussion and voting of the issue according to relevant regulation and keep it in the meeting minutes. The Company also has standard procedures for employees to report any potential conflicts of interests. The Company has a strict accounting system and dedicated accounting department. For ensuring accuracy and transparency, all financial statements are audited or reviewed byDeloitte & Touche in

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Evaluation Item	ImplementationStatus1	ImplementationStatus1	ImplementationStatus1	Deviations from the “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies”andReasons
	Yes	No	Abstract Illustration
of unethical conduct risk assessments and devise audit plans to audit the systems accordingly to prevent unethical conduct, or hire outside accountants to perform the audits? (5) Does the company regularly hold internal and external educational trainings on operational integrity?			accordance with relevant regulation. In order to implement “Regulations Governing Establishment of Internal Control Systems by Public Companies" and "Principles for Ethical Management", the Company has set up the Auditing Department which established its internal control system. And the Audit Department will regularly review and revise the internal control system. In addition, the Audit Department will develop and implement its annual internal audit plan in accordance with risk assessment. The Company does not use CPA for auditing. To establish corporate culture of ethical management and prevent unethical behaviors, the Company holds internal training sections for employees understanding our commitment to ethical management and policies. Our “Codes of Ethical Conduct”, “Principles for Ethical Management”, and relevant regulations have been posted on the Company's website and internal bulletin board. The Company provides online workplace ethics education training. The length is 80 minutes. In 2019,in addition to the continuous trainingof

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Evaluation Item	ImplementationStatus1	ImplementationStatus1	ImplementationStatus1	Deviations from the “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies”andReasons
	Yes	No	Abstract Illustration
			employees, 30 new employees were required to be trained.
3. Operation of the integrity channel (1) Does the company establish both a reward/punishment system and an integrity hotline? Can the accused be reached by an appropriate person for follow-up? (2) Does the company have in place standard operating procedures for investigating accusation cases, as well as follow-up actions and relevant post-investigation confidentiality measures? (3) Does the company provide proper whistleblower protection?			The Board of Directors enacted “Working Procedures for Reporting Illegal, Unethical, and Dishonest Issues”, and also enacted “Complainant rules for employees” on May 13, 2015. Alleged violator has the right to appeal to the investigation team while investigation hearing could be made if necessary. According to the above rules, the Company will treat all complaint confidentially and protect whistleblowers. The identification informants of whistleblowers will be kept confidential. The Company will also ensure that whistleblowers won’t be revenged because of reporting improper issues. Above mentioned rules are disclosed on the Company’s website.	None
4. Strengthening information disclosure (1) Does the company disclose its ethical corporate management policies and the results of its implementation on the company’s website and MOPS?			Our “Codes of Ethical Conduct”, “Principles for Ethical Management”, and relevant regulations have been posted on the Company's website and internal bulletin board.	None

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Evaluation Item	ImplementationStatus1	ImplementationStatus1	ImplementationStatus1
	Yes	No	Abstract Illustration
			The Company has designated employees responsible for disclosing relevant information on MOPS and the Company's website (http://www.acc.com.tw). Since the adoption of Principles for Ethical Management, there is no violation needed to be disclosed.
5. If the company has established the ethical corporate management policies based on the Ethical Corporate Management Best-Practice Principles for TWSE/TPEx Listed Companies, please describe any discrepancy between the policies and their implementation. There have been no differences.
6. Other important information to facilitate a better understanding of the company’s ethical corporate management policies (e.g., review and amend its policies). The company adds integrity information to the procurement system to ensure supplier compliance, and there are appeal channels available. The Company treats its employees and business partners with the highest standards of ethical conducts. Any bribery or unethical conducts made byits employees or suppliers will bepunished,such as disposition,rejection of transaction,or legalprosecution.

Access to Corporate Governance Best-Practice Principles and relevant regulations: Please visit the Company's website at http://www.acc.com.tw.
Any other important information to facilitate better understanding of the Company’s corporate governance practices: None.
During the most recent fiscal year and the current fiscal year up to the date of printing of this annual report, any punishment occurred for the Company and its employees violating laws, and any punishment, fault and improvement occurred for the Company’s employees against the regulations of Internal Audit System: None.
To appoint certified accountants to audit internal audit system: None.

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3.3.9 The Training for Directors

Name	Date	Organizer	Course Title and Lecturer	Hours
Directors Douglas Tong Hsu Tsai Hsiung Chang Johnny Shih Peter Hsu Kun Yen Lee Connie Hsu C.V.Chen C.K.Chang Chin-Der Ou Champion Lee Independent Directors Ta-Chou Huang Chi Schive Gordon S.Chen	Jul.23,2019	Taiwan Academy of Banking and Finance	Board Operations Practice and Corporate Governance Workshop	3
Directors Douglas Tong Hsu Tsai Hsiung Chang Johnny Shih Kun Yen Lee Connie Hsu C.K.Chang Chin-Der Ou Champion Lee Kwan-Tao Li Independent Directors Ta-Chou Huang	Nov.14,2019	Taiwan Academy of Banking and Finance	Board Operations Practice and Corporate Governance Workshop	3
Directors Peter Hsu	May.8,2019	Corporate Governance Association	Important Issues of Group Corporate Governance	3
Directors Peter Hsu	Aug.2,2019	Corporate Governance Association	Cloud Computing: The benefit and the risk	3
Directors Ruey Long Chen	Sep.3,2019	Securities & Futures Institute	Directors and supervisors in the performance of their duties and principles of businessjudgment	3
Directors Ruey Long Chen	Sep.3,2019	Securities & Futures Institute	The development of international and Taiwan's anti-tax avoidance and the ways for enterprises to respond	3
Directors Kwan-Tao Li	Dec.10,2019	Corporate Governance Association	Viewing the impact of economic substantive law and global anti-tax avoidance on corporate governance from the perspective of directors and supervisors	3
Directors C.V. Chen	Sep. 18,2019	Corporate Governance Association	Discussion on the influence of new law on Money Laundering Prevention on enterprises	3
Independent Directors Chi Schive	Sep. 24,2019	Corporate Governance Association	Anti-money laundering and bribery risk practices	3
Independent Directors Gordon S.Chen	Nov.25,2019	TWSE	Publicity meeting for effective use of directors' functions	3

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3.3.10 The Training for Managers

Title	Name	Date	Organizer	Course Title and Lecturer	Ho urs
Deputy Chief Auditor	W.H.Yeh	May.30,2019- May.31,2019	Accounting Research and Development Foundation	Training courses for internal auditors of public issuing companies	12
Assistant Vice President	Nancy Kao	Oct.21,2019- Oct.22,2019	Accounting Research and Development Foundation	Training courses for accounting managers	12
President Chief Executive Vice President Executive Vice President Vice President Vice President Vice President General Plant Manager Deputy Chief Auditor Assistant Vice President Special Assistant Manager Manager Manager Manager	Kun Yen Lee Y.F.Chang Doris Wu C.M.Chen W.K.Chou T.L.Yu Z.P.Chang W.H.Yeh Nancy Kao T.M.Chen Manfred Wang Chenho Chung Gary Lee Yuchi Tsai	Apr.17,2019 Aug.21,2019	Asia Cement	Using digital leverage to accelerate innovation and transformation: Chun-Yao Huang, Professor of College of Management, National Taiwan University Innovative learning ability for survival of the fittest in AI Age: Sega Cheng, iKala CEO	4
Chief Executive Vice President Executive Vice President Vice President Vice President Special Assistant Manager Manager	Y.F.Chang Doris Wu C.M.Chen W.K.Chou T.M.Chen Manfred Wang Chenho Chung	Jul.23,2019	Taiwan Academy of Banking and Finance	Board Operations Practice and Corporate Governance Workshop	3
Chief Executive Vice President Executive Vice President Vice President Vice President Special Assistant	Y.F.Chang Doris Wu C.M.Chen W.K.Chou T.M.Chen	Nov.14,2019	Taiwan Academy of Banking and Finance	Board Operations Practice and Corporate Governance Workshop	3

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3.3.11 The Execution Status of Internal Control System

Asia Cement Corporation Statement of Internal Control System

Date: March 25, 2020

Asia Cement Corporation(ACC) has conducted a self-inspection of internal control system during 2019. The results are as follows:

ACC acknowledges that the implementation and maintenance of internal control system is the responsibility of Board of Directors and managerial level, and ACC has established such system. It is aimed to reasonably ensure that the goals such as effective and efficient operations (including profitability, performance, and safeguard of assets), the reliability, timeliness, transparency, and regulatory compliance of reporting , and the compliance with applicable laws and regulations are achieved.

The internal control system has its inherent limitations; whatever a perfect design is, an internal control system can provide only reasonable assurance that the above-mentioned goals will be achieved; besides, owing to the change of environment and circumstances, the effectiveness of internal control system will be changed accordingly. However, the internal control system of ACC is equipped with self-monitoring mechanisms and ACC will take corrective action once defect is identified.

According to the criteria for the internal control system as specified in “Guidelines for Implementation of Establishing Internal Control System by Public Listed Companies”(hereinafter referred to as “Guidelines,”) ACC evaluates the effectiveness of its internal control system. The said Guidelines divide internal control system into five components: (1) Control Environment, (2) Risk Assessment, (3) Control Operations, (4) Information and Communication, and (5) Monitoring. Each component includes certain items. For the foregoing items, please refer to “Guidelines”.

ACC has adopted the aforesaid criteria for internal control system to evaluate the effectiveness of design and implementation of internal control system.

Based on the findings of the evaluation mentioned in the preceding paragraph, ACC believes that as at December 31, 2019 its internal control system (including its supervision and management of subsidiaries), encompassing internal controls for knowledge of the degree of achievement of operational effectiveness and efficiency objectives, the reliability, timeliness, transparency, and regulatory compliance of reporting , and the compliance with applicable laws and regulations, was effectively designed and operating, and reasonably assured the achievement of the above-stated objectives.

This statement comprises the entire annual report and public brochure, and will be publicly disclosed. If the aforesaid statement has any unlawful attempt such as pretence and concealment, ACC will assume the legal responsibilities according to Article 20, 32, 171 and 174 of Securities and Exchange Law.

This statement has been approved by ACC Board of Directors at the meeting of March 25, 2020 with 15 directors in presence and none disagreement with the content of this statement.

Asia Cement Corporation Chairman: Douglas Tong Hsu President: K.Y. Lee

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3.3.12 Major Resolutions of Shareholders’ Meeting and Board Meetings

1. Major resolution of 2018 Regular Shareholders’ Meeting

Date

Major resolutions

2019/06/24

1. Acceptance of 2018 financial statements and consolidated financial statements
2. Acceptance of the proposal for distribution of 2018 profits.
3. Amendment to “Articles of Incorporation of Asia Cement Corporation”.
4. Amendment to “Procedure for Acquisition and Disposal of Assets”.
5. Amendment to “Procedure for Making Endorsements and Guarantees”.
6. Amendment to “Procedure for Loan toOthers”.

Execution
Status

Major resolutions of the Shareholders’ meeting have been fully implemented.
1. The record date for distribution of 2018 profits was Jul. 30, 2019. Cash
dividends have been distributed on Aug. 16, 2019.
2. Relevant amendments have been disclosed on our website.

2. Major Resolutions of the Board of Directors

Totally 6 meetings of the Board of Directors were held in the period from Jan. 1, 2019 to May 12 2020.Directors have no opposition to major resolutions in this period.

Regarding the items listed in Article 14(3) of the Securities Exchange Act, all attended independent directors approved without disagreement.

Date

Major resolutions

2019/03/21

1. Acceptance of the 2018 employees’ compensation and Directors’ and
Supervisors’ remuneration.
2. Acceptance of 2018 financial statements and consolidated financial statements.
3. Acceptance of the proposal for distribution of 2018 profits.
4. Acceptance of 2019 business budget.
5. Acceptance of 2019 CPA service fee of Deloitte & Touche.
6. To convene 2019 regular shareholders' meeting.
7. Acceptance to issue 2018 Statement of Internal Control System.
8. Amendment to the "internal control system".
9. Amendment to the "accounting system".
10. Tto issue medium and long-term unsecured commercial paper with total amount
not exceeding NT$10 billion in order to repay the loan, enrich the medium and
long-term working capital, and strengthen the financial structure.
11. To issue unsecured corporate bonds in once or in a batch with total amount not
exceeding NT$10 billion in order to repay the loan, enrich the medium and
long-term working capital, and strengthen the financial structure.
12. To issue a letter of support for the Company’s subsidiary, Chiahui Power Corp.,
for 20-year-term NT$10.5 billion syndicated loan.
13. Amendment to “Articles of Incorporation of Asia Cement Corporation”
14. Amendment to “the Working Procedures for the Acquisition and Disposal of
Assets”.
15. Amendment to “the Procedure for Making Endorsements and Guarantees”
16. Amendment to “the Procedure for Loans of Funds to Others”
17. Amendment to “the Procedure for Employee Retirement.

2019/05/10

1. Acceptance of 2018 Business Report.
2. Amendment to "Corporate Governance Code", "Meeting Rules of the Board of
Directors", "Organization Rules of the Audit Committee" and "Organization
Rules for the Remuneration Committee".
3. To change the member of remuneration committee.
4. To set up CorporateGovernanceOfficer.

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2019/08/09 1. Amendment to the "internal control system" and its implementation rules. 2019/11/09 1. To accept 2020 audit plan. 2. Amendment to the "internal control system". 3. To issue unsecured corporate bonds in once or in a batch with total amount not exceeding NT$10 billion in order to repay the loan, enrich the medium and long-term working capital, and strengthen the financial structure. 4. To purchase liability insurance for directors, and supervisors, and important employees of the Company and its affiliates in the consolidated financial statements. 2020/03/25 1. Acceptance of the 2019 employees’ compensation and Directors’ and Supervisors’ remuneration. 2. Acceptance of 2019 financial statements and consolidated financial statements. 3. Acceptance of the proposal for distribution of 2019 profits. 4. Acceptance of 2020 business budget. 5. Acceptance of 2019 CPA service of Deloitte & Touche. 6. To Elect Directors and Independent Directors. 7. To convene 2019 regular shareholders' meeting. 8. To release the prohibition on Directors from participation in competitive business 9. Acceptance to issue 2019 Statement of Internal Control System. 10. To issue unsecured corporate bonds in once or in a batch with total amount not exceeding NT$20 billion in order to repay the loan, enrich the medium and long-term working capital, and strengthen the financial structure. 11. Amendment to “Articles of Incorporation of Asia Cement Corporation”. 12. Amendment to “Meeting Rules for Shareholders’ Meeting”. 13. Amendment to “Meeting Rules for Board of Directors’ Meeting”. 14. Amendments to “Principles for Ethical Management of Asia Cement Corporation”

3.3.13 Resignation or dismissal of the chairman, president, accounting manager, finance manager, auditing manager, and R&D manager of the Company : None.

◎The Board of Director approved “the Procedure Dealing with Internal Material Information of Asia Cement Corporation” on December 21, 2009 and modified on August 10, 2017. This Procedure has been posted on the Company’s electronic bulletin board.

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3.4 Information of CPA Service Fee

Information of CPA service fee

Accounting Firm	Name of CPA	Audit Fee		Non-audit Fee	Non-audit Fee	Non-audit Fee		Audit period
			System design	Business Registration	Human Resource	Other (Note)	Subtotal
Deloitte & Touche	X.W. Tai	7,560	0	10	50	874	934	01/01/2019-12/31/2019
	Y. W. Fan

Note: Others including (1)Transfer Pricing report 280 thousands (2)Application of tax rulings 300 thousands (3)Audit fee for investment in mainland china 80 thousands (4)Corporate Bonds issuance expenses and opinions 214 thousands.

If the audit fee in the year CPA firm changes is lower than that in the prior year, specify the amount of audit fee before and after and the reason: None.
If the audit fee dropped year on year by more than 10%, specifies the amount, percentage, reason of the reduction: None.
Change of CPA in recent two fiscal years and subsequent periods: The Company commissioned Deloitte & Touche-Taiwan to audit the financial statements. Due to internal function adjustments in Deloitte & Touche-Taiwan, the audit has been commissioned from CPA Li Wen Kuo and Yu Wei Fan to CPA Shin Wei Tai and Yu Wei Fan since 2019Q1.
The ACC Chairman, President, and managers who are responsible for finance and accounting do not have any position at CPA Firm or its affiliated companies in the most recent fiscal year.

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3.5 Relevant licenses and certificates obtained about transparent financial

information

Department	Name	Title	Licenses and Certificates
Finance	Doris Wu	Executive Vice President	CPA, Taiwan and United States
Finance	Yu LingYang	Assistant Vice President	CPA,Taiwan and China
Finance	Ya PingLi	Manager	CPA,Taiwan
Finance	Yu De Liao	Deputy Manager	Certified Internal Auditor Certified Information Systems Auditor
Finance	Wei ZhongChen	Section Chief	Chartered Financial Analyst
Auditing	Chi Wen Lu	Assistant Specialist	Certified Internal Auditor Certification in Risk Management Assurance
Accounting	Jia NingHsu	Senior Clerk	CPA,Taiwan
Accounting	GuangRen Peng	Assistant Administrator	CPA,United States
Accounting	YingBei Lin	Assistant Administrator	CPA,Taiwan
Accounting	Bi Chen Weng	Assistant Administrator	CPA,Taiwan

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3.6 Changes in Shareholdings and pledge of Directors, Supervisors,

Managers, and Shareholders with more than 10% Shareholding

1. Changes in Shareholdings:

Title	Name	Shareholdingo	n Dec.31,2019	Shareholdingo	n Apr. 25,2020
		Changes of Shares	Changes of Shares Pledged	Changes of Shares	Changes of Shares Pledged
Chairman	Douglas TongHsu	－	－	－	－
Director	Far Eastern New Century Corporation4	－	－	－	－
	T.H. Chang	－	－	－	－
	JohnnyShih	－	－	－	－
	C.V. Chen	－	－	－	－
Director	Bai-Yang Investment Holdings Corporation	－	－	－	－
	Chin-Der Ou	－	－	－	－
Director	U-Ding Corporation	－	－	－	－
	K.Y.Lee	－	－	－	－
Director	Far Eastern Y.Z. Hsu Science And TechnologyMemorial Foundation	－	－	－	－
	Peter Hsu	－	－	－	－
	C.K. Chang	－	－	－	－
Director	Ta Chu Chemical Fiber Co.,Ltd	－	－	－	－
	RueyLong Chen	－	－	－	－
Director	Huey Kang Investment Corporation	－	－	－	－
	Connie Hsu	－	－	－	－
Director	Far Eastern Medical Foundation Champion Lee	－	－	－	－
Director	U-Ming Corporation K.T.Li	－	－	－	－
Independent Director	Ta-Chou Huang	－	－	－	－
Independent Director	Chi Schive	－	－	20,000	－
Independent Director	Gordon S. Chen	－	－	－	－
President	K.Y.Lee	－	－	－	－
Chief Executive Vice President	Y.F. Chang	－	－	－	－

4 The majority shareholder with holding more than 10% share of the Company.

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Title	Name	Shareholdingon Dec.31,2019	Shareholdingon Dec.31,2019	Shareholdingon Apr. 25,2020	Shareholdingon Apr. 25,2020
		Changes of Shares	Changes of Shares Pledged	Changes of Shares	Changes of Shares Pledged
Executive Vice President	Doris Wu	－	－	－	－
Vice President	C.M. Chen	－	－	－	－
VicePresident	W.K. Chou	－	－	－	－
General Plant Manager	Z.P. Chang	－	－	－	－
Vice President	T.L.Yu	－	－	－	－
Deputy Chief Auditor	W.H. Yeh	－	－	－	－
Special Assistant	T.M. Chen	－	－	－	－
Accounting Manager	H.Y. Kao	－	－	－	－
Assistant Vice President	Dana Lee	－	－	－	－
Assistant Vice President	Karen Yang	－	－	－	－
Manager	Z.H Zhong	－	－	－	－
Manager	GaryLee	－	－	－	－
Plant Manager	Z.X. Zhuang	－	－	－	－

Shareholders transfer information: Since the relative transfer of shareholders is non-related person, so there is no information on this information.
Shareholders pledge information: no shareholders pledged.

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1.7 Information Disclosing the Relationship between any of the Company’s Top 10 Shareholders

Name	Shares Held	Shares Held	Shares of Spouse & Minor	Shares of Spouse & Minor	Total Shareholding Held In The Name of Others	Total Shareholding Held In The Name of Others	The name and relation of top10 shareholders who mutually have relations that meet the definition of the “affiliate”, or mutuallyare spouses or within two degrees of kinship	The name and relation of top10 shareholders who mutually have relations that meet the definition of the “affiliate”, or mutuallyare spouses or within two degrees of kinship
	Shares	%	Shares	%	Shares	%	Name	Relation
Far Eastern New Century Corp. Representative: Douglas Tong Hsu	750,511,324	22.33%	0	0%	0	0%	Far Eastern Medical Foundation	The Same Chairman
			0	0%	0	0%	Labor Pension Fund Committee of Far Eastern New Century Corporation	Non-related party
			0	0%	0	0%	Yuan Ding Investment Company	The Same Chairman
			0	0%	0	0%	Yuanta/P-shares Taiwan Dividend Plus ETF	Non-related party
			0	0%	0	0%	Far Eastern Department Stores Co., Ltd.	The Same Chairman
			0	0%	0	0%	Yuan-Ze University	The Same Chairman
			0	0%	0	0%	Far Eastern Memorial Foundation	Chairman is the Director of the Foundation
			0	0%	0	0%	Yu Yuan Investment Co., Ltd	Non-related party
			0	0%	0	0%	Yu Chang Investment Company	Non-related party
Far Eastern Medical Foundation Representative: Douglas Tong Hsu	181,566,797	5.40%	0	0%	0	0%	Far Eastern New Century Corporation	The Same Chairman
			0	0%	0	0%	Labor Pension Fund Committee of Far Eastern New Century Corporation	Non-related party
			0	0%	0	0%	Yuan Ding Investment Company	The Same Chairman
			0	0%	0	0%	Yuanta/P-shares Taiwan Dividend Plus ETF	Non-related party
			0	0%	0	0%	Far Eastern Department Stores Co., Ltd.	The Same Chairman
			0	0%	0	0%	Yuan-Ze University	The Same Chairman

Name	Shares Held	Shares Held	Shares of Spouse & Minor	Shares of Spouse & Minor	Total Shareholding Held In The Name of Others	Total Shareholding Held In The Name of Others	The name and relation of top10 shareholders who mutually have relations that meet the definition of the “affiliate”, or mutuallyare spouses or within two degrees of kinship	The name and relation of top10 shareholders who mutually have relations that meet the definition of the “affiliate”, or mutuallyare spouses or within two degrees of kinship
	Shares	%	Shares	%	Shares	%	Name	Relation
			0	0%	0	0%	Far Eastern Memorial Foundation	Chairman is the Director of the Foundation
			0	0%	0	0%	Yu Yuan Investment Co., Ltd	Non-related party
			0	0%	0	0%	Yu Chang Investment Company	Non-related party
Labor Pension Fund Committee of Far Eastern New Century Corporation	51,999,049	1.55%	0	0%	0	0%	Far Eastern New Century Corporation	Non-related party
			0	0%	0	0%	Far Eastern Medical Foundation	Non-relatedparty
			0	0%	0	0%	Yuan Ding Investment Company	Non-related party
			0	0%	0	0%	Yuanta/P-shares Taiwan Dividend Plus ETF	Non-related party
			0	0%	0	0%	Far Eastern Department Stores Co., Ltd.	Non-relatedparty
			0	0%	0	0%	Yuan-Ze University	Non-relatedparty
			0	0%	0	0%	Far Eastern Memorial Foundation	Non-relatedparty
			0	0%	0	0%	Yu Yuan Investment Co., Ltd	Non-relatedparty
			0	0%	0	0%	Yu Chang Investment Company	Non-relatedparty
Yuan Ding Investment Company Representative: Douglas Tong Hsu	51,287,518	1.53%	0	0%	0	0%	Far Eastern New Century Corporation	The Same Chairman
			0	0%	0	0%	Far Eastern Medical Foundation	The Same Chairman
			0	0%	0	0%	Labor Pension Fund Committee of Far Eastern New Century Corporation	Non-related party
			0	0%	0	0%	Yuanta/P-shares Taiwan Dividend Plus ETF	Non-relatedparty
			0	0%	0	0%	Far Eastern Department Stores Co., Ltd.	The Same Chairman
			0	0%	0	0%	Yuan-Ze University	The Same Chairman

Name	Shares Held	Shares Held	Shares of Spouse & Minor	Shares of Spouse & Minor	Total Shareholding Held In The Name of Others	Total Shareholding Held In The Name of Others	The name and relation of top10 shareholders who mutually have relations that meet the definition of the “affiliate”, or mutuallyare spouses or within two degrees of kinship	The name and relation of top10 shareholders who mutually have relations that meet the definition of the “affiliate”, or mutuallyare spouses or within two degrees of kinship
	Shares	%	Shares	%	Shares	%	Name	Relation
			0	0%	0	0%	Far Eastern Memorial Foundation	Chairman is the Director of the Foundation
			0	0%	0	0%	Yu Yuan Investment Co., Ltd	Non-relatedparty
			0	0%	0	0%	Yu Chang Investment Company	Non-relatedparty
Yuanta/P-shares Taiwan Dividend Plus ETF	50,780,342	1.51%	0	0%	0	0%	Far Eastern New CenturyCorporation	Non-related party
			0	0%	0	0%	Far Eastern Medical Foundation	Non-related party
			0	0%	0	0%	Labor Pension Fund Committee of Far Eastern New Century Corporation	Non-related party
			0	0%	0	0%	Yuan DingInvestment Company	Non-related party
			0	0%	0	0%	Far Eastern Department Stores Co., Ltd.	Non-related party
			0	0%	0	0%	Yuan-Ze University	Non-related party
			0	0%	0	0%	Far Eastern Memorial Foundation	Non-related party
			0	0%	0	0%	Yu Yuan Investment Co., Ltd	Non-related party
			0	0%	0	0%	Yu Chang Investment Company	Non-related party
Far Eastern Department Stores Co., Ltd. Representative: Douglas Tong Hsu	50,000,492	1.49%	0	0%	0	0%	Far Eastern New Century Corporation	The Same Chairman
			0	0%	0	0%	Far Eastern Medical Foundation	The Same Chairman
			0	0%	0	0%	Labor Pension Fund Committee of Far Eastern New CenturyCorporation	Non-related party
			0	0%	0	0%	Yuan Ding Investment Company	The Same Chairman
			0	0%	0	0%	Yuanta/P-shares Taiwan Dividend Plus ETF	Non-related party

Name	Shares Held	Shares Held	Shares of Spouse & Minor	Shares of Spouse & Minor	Total Shareholding Held In The Name of Others	Total Shareholding Held In The Name of Others	The name and relation of top10 shareholders who mutually have relations that meet the definition of the “affiliate”, or mutuallyare spouses or within two degrees of kinship	The name and relation of top10 shareholders who mutually have relations that meet the definition of the “affiliate”, or mutuallyare spouses or within two degrees of kinship
	Shares	%	Shares	%	Shares	%	Name	Relation
			0	0%	0	0%	Yuan-Ze University	The Same Chairman
			0	0%	0	0%	Far Eastern Memorial Foundation	Chairman is the Director of the Foundation
			0	0%	0	0%	Yu Yuan Investment Co., Ltd	Non-related party
			0	0%	0	0%	Yu Chang Investment Company	Non-relatedparty
Yuan-Ze University Representative: Douglas Tong Hsu	47,499,567	1.41%	0	0%	0	0%	Far Eastern New Century Corporation	The Same Chairman
			0	0%	0	0%	Far Eastern Medical Foundation	The Same Chairman
			0	0%	0	0%	Labor Pension Fund Committee of Far Eastern New Century Corporation	Non-related party
			0	0%	0	0%	Yuan DingInvestment Company	The Same Chairman
			0	0%	0	0%	Yuanta/P-shares Taiwan Dividend Plus ETF	Non-related party
			0	0%	0	0%	Far Eastern Department Stores Co., Ltd.	The Same Chairman
			0	0%	0	0%	Far Eastern Memorial Foundation	Chairman is the Director of the Foundation
			0	0%	0	0%	Yu Yuan Investment Co., Ltd	Non-related party
			0	0%	0	0%	Yu Chang Investment Company	Non-related party
Far Eastern Memorial Foundation Representative:	44,115,478	1.31%	0	0%	0	0%	Far Eastern New Century Corporation	Director of the Foundation is the Chairman

Name	Shares Held	Shares Held	Shares of Spouse & Minor	Shares of Spouse & Minor	Total Shareholding Held In The Name of Others	Total Shareholding Held In The Name of Others	The name and relation of top10 shareholders who mutually have relations that meet the definition of the “affiliate”, or mutuallyare spouses or within two degrees of kinship	The name and relation of top10 shareholders who mutually have relations that meet the definition of the “affiliate”, or mutuallyare spouses or within two degrees of kinship
	Shares	%	Shares	%	Shares	%	Name	Relation
Chu Shu-Hsun			0	0%	0	0%	Far Eastern Medical Foundation	Director of the Foundation is the Chairman
			0	0%	0	0%	Labor Pension Fund Committee of Far Eastern New Century Corporation	Non-related party
			0	0%	0	0%	Yuan Ding Investment Company	Director of the Foundation is the Chairman
			0	0%	0	0%	Yuanta/P-shares Taiwan Dividend Plus ETF	Non-related party
			0	0%	0	0%	Far Eastern Department Stores Co., Ltd.	Director of the Foundation is the Chairman
			0	0%	0	0%	Yuan-Ze University	Director of the Foundation is the Chairman
			0	0%	0	0%	Yu Yuan Investment Co., Ltd	Non-related party
			0	0%	0	0%	Yu Chang Investment Company	Non-related party
Yu Yuan Investment Co., Ltd Representative:	43,268,479	1.29%	0	0%	0	0%	Far Eastern New Century Corporation	Non-related party
			0	0%	0	0%	Far Eastern Medical Foundation	Non-related party

Name	Shares Held	Shares Held	Shares of Spouse & Minor	Shares of Spouse & Minor	Total Shareholding Held In The Name of Others	Total Shareholding Held In The Name of Others	The name and relation of top10 shareholders who mutually have relations that meet the definition of the “affiliate”, or mutuallyare spouses or within two degrees of kinship	The name and relation of top10 shareholders who mutually have relations that meet the definition of the “affiliate”, or mutuallyare spouses or within two degrees of kinship
	Shares	%	Shares	%	Shares	%	Name	Relation
C.M. Chen			0	0%	0	0%	Labor Pension Fund Committee of Far Eastern New Century Corporation	Non-related party
			0	0%	0	0%	Yuan Ding Investment Company	Non-related party
			0	0%	0	0%	Yuanta/P-shares Taiwan Dividend Plus ETF	Non-related party
			0	0%	0	0%	Far Eastern Department Stores Co., Ltd.	Non-related party
			0	0%	0	0%	Yuan-Ze University	Non-related party
			0	0%	0	0%	Far Eastern Memorial Foundation	Non-related party
			0	0%	0	0%	Yu Chang Investment Company	Non-related party
Yu Chang Investment Company Representative: Dong Wang-Miao-Fang	42,419,430	1.26%	0	0%	0	0%	Far Eastern New Century Corporation	Non-related party
			0	0%	0	0%	Far Eastern Medical Foundation	Non-related party
			0	0%	0	0%	Labor Pension Fund Committee of Far Eastern New Century Corporation	Non-related party
			0	0%	0	0%	Yuan Ding Investment Company	Non-related party
			0	0%	0	0%	Yuanta/P-shares Taiwan Dividend Plus ETF	Non-related party
			0	0%	0	0%	Far Eastern Department Stores Co., Ltd.	Non-related party
			0	0%	0	0%	Yuan-Ze University	Non-related party
			0	0%	0	0%	Far Eastern Memorial Foundation	Non-related party
			0	0%	0	0%	Yu Yuan Investment Co., Ltd	Non-related party

3.8 Shareholding Proportion of ACC to Investees

Dec. 31, 2019

					Dec. 31,2019	Dec. 31,2019
Investees	Investments by ACC		Investments by Directors, Supervisors, Managers and Directly or Indirectly Controlled Businesses		Total Investments
	Shares	%	Shares	%	Shares	%
Asia Investment Corp.	222,039,596	100.00%	-	0.00%	222,039,596	100.00%
Sunrise Industrial Holdings Ltd.	90,000	100.00%	-	0.00%	90,000	100.00%
Yuan Long Stainless Steel Corp.	200,000,000	100.00%	-	0.00%	200,000,000	100.00%
Der Ching Investment Corp.	595,576,603	99.99%	25,326	0.00%	595,601,929	99.99%
Ya Tung Ready-Mixed Concrete Corp.	159,067,779	99.99%	6,909	0.00%	159,074,688	99.99%
Nan Hwa Cement Corp.	26,128,171	99.94%	12,396	0.05%	26,140,567	99.99%
Asia Cement (Singapore) Pte. Ltd.	10,495,495	99.96%	2	0.00%	10,495,497	99.96%
Fu Ming Transportation Co., Ltd.	29,517,188	99.82%	39,944	0.14%	29,557,132	99.96%
Asia Engineering Enterprise Corp.	7,970,703	98.23%	123,243	1.52%	8,093,946	99.75%
FEDS Development Ltd.	53,250,000	25.00%	149,100,000	70.00%	202,350,000	95.00%
Yuan Ding Co., Ltd.	178,707,648	35.50%	259,921,774	51.62%	438,629,422	87.12%
Ya Li Precast and Prestressed Concrete Industries	16,241,083	83.81%	14,366	0.08%	16,255,449	83.89%
Asia Cement (China) Holdings Corp.	1,061,209,202	67.73%	71,064,298	4.54%	1,132,273,500	72.27%
Chiahui Power Corp.	280,093,521	59.59%	1,100,069	0.24%	281,193,590	59.83%
Ya Li Transportation Corp.	5,100,000	51.00%	60,817	0.61%	5,160,817	51.61%
Everstrong Iron & Steel Foundry Ltd.	3,199,823	40.40%	660,000	8.34%	3,859,823	48.74%
Yuan Ding Leasing Corp..	34,640,189	43.60%	-	0.00%	34,640,189	43.60%
U-Ming Marine Transport Corp.	331,701,152	39.25%	20,514,219	2.43%	352,215,371	41.68%
Oriental Securities Corp..	135,092,154	18.93%	144,591,810	20.26%	279,683,964	39.19%
Far Eastern New Century Corp.	1,272,277,085	23.77%	556,345,442	10.39%	1,828,622,527	34.16%
Yue Yuan Investment Corp.	155,000,803	29.92%	515,024	0.10%	155,515,827	30.02%
China Shanshui Cement Group Ltd	331,878,315	7.62%	428,393,000	9.84%	760,271,315	17.46%

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IV Capital Formation

4.1 Capital and Shares

4.1.1 Capital Increase in the Past Five Years

4.1.1 Capital Increase in the Past Five Years	4.1.1 Capital Increase in the Past Five Years	4.1.1 Capital Increase in the Past Five Years	4.1.1 Capital Increase in the Past Five Years	4.1.1 Capital Increase in the Past Five Years	4.1.1 Capital Increase in the Past Five Years	4.1.1 Capital Increase in the Past Five Years	4.1.1 Capital Increase in the Past Five Years	4.1.1 Capital Increase in the Past Five Years
As of Apr. 30,2020
Date	Par Value	Authorized Capital		Paid-in Capital		Remarks
		Shares	Amount (NT$)	Shares	Amount (NT$)	Sources of Capital	Capital Increased by Assets Other than Cash	Others
Dec.2010	NT$10	3,300,000,000	33,000,000,000	3,075,307,547	30,753,075,470	Dividend	None	None
Dec.2011	NT$10	3,600,000,000	36,000,000,000	3,136,813,697	31,368,136,970	Dividend	None	None
Dec.2012	NT$10	3,600,000,000	36,000,000,000	3,230,918,107	32,309,181,070	Dividend	None	None
Dec.2013	NT$10	3,600,000,000	36,000,000,000	3,295,536,469	32,955,364,690	Dividend	None	None
Dec.2014	NT$10	3,600,000,000	36,000,000,000	3,361,447,198	33,614,471,980	Dividend	None	None

4.1.2 Capital

Share Type	Authorized Capital	Authorized Capital	Authorized Capital	Reserve for Convertible Shares
	Issued Shares	Un-issued Shares	Total Shares
Common Shares	3,361,447,198 Available for trading on the TWSE	238,552,802	3,600,000,000	-

4.1.3 Shelf Registration ： None

4.1.4 Shareholder Structure

4.1.3 Shelf Registration：None 4.1.4 Shareholder Structure	4.1.3 Shelf Registration：None 4.1.4 Shareholder Structure	4.1.3 Shelf Registration：None 4.1.4 Shareholder Structure	4.1.3 Shelf Registration：None 4.1.4 Shareholder Structure	4.1.3 Shelf Registration：None 4.1.4 Shareholder Structure	4.1.3 Shelf Registration：None 4.1.4 Shareholder Structure	4.1.3 Shelf Registration：None 4.1.4 Shareholder Structure
As of Apr. 30,2020
Structure Amount	Governments	Financial Institutions	Other Institutional Investors	Domestic Individual Investors	Foreign Institutions & Individuals	Total
Number of Shareholders	10	63	347	73,827	844	75,091
Number of shares	64,569,627	270,282,570	1,694,081,320	503,638,526	828,875,155	3,361,447,198
Shareholding Percentage	1.92%	8.04%	50.40%	14.98%	24.66%	100.00%

Note: No foreign institutions and individuals from China Area.

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4.1.5 Shareholding Distribution Status

4.1.5 Shareholding Distribution Status	4.1.5 Shareholding Distribution Status	4.1.5 Shareholding Distribution Status	4.1.5 Shareholding Distribution Status
As of Apr. 30,2020
Class of Shareholding (Unit: Share)	Number of shareholders	Number of shares	Holding Percentage
1-999	34,080	8,191,662	0.24%
1,000-5,000	28,161	61,149,165	1.82%
5,001-10,000	5,483	40,671,537	1.21%
10,001-15,000	2,140	26,223,434	0.78%
15,001-20,000	1,148	20,494,587	0.61%
20,001-30,000	1,204	29,856,446	0.89%
30,001-40,000	569	19,846,864	0.59%
40,001-50,000	384	17,535,807	0.52%
50,001-100,000	779	55,430,899	1.65%
100,001-200,000	402	56,142,770	1.67%
200,001-400,000	273	76,817,534	2.29%
400,001-600,000	100	48,739,048	1.45%
600,001-800,000	71	48,804,780	1.45%
800,001-1,000,000	44	39,749,969	1.18%
Over 1,000,001	253	2,811,792,696	83.65%
Total	75,091	3,361,447,198	100%

Preferred Share

Preferred Share	Preferred Share	Preferred Share	Preferred Share
As of Apr. 30,2020
Class of Shareholding (Unit: Share)	Number of shareholders	Number of shares	Holding Percentage
NA	0	0	0

4.1.6 List of Major Shareholders

4.1.6 List of Major Shareholders	4.1.6 List of Major Shareholders	4.1.6 List of Major Shareholders
As of Apr. 30,2020
Shares Major Shareholder	Number of Shares	Holding Percentage
Far Eastern New CenturyCorporation	750,511,324	22.33%
Far Eastern Medical Foundation	181,566,797	5.40%
Labor Pension Fund Committee of Far Eastern New CenturyCorporation	51,999,049	1.55%
Yuan DingInvestment Company	51,287,518	1.53%
Yuanta/P-shares Taiwan Dividend Plus ETF	50,780,342	1.51%
Far Eastern Department Stores Co.,Ltd.	50,000,492	1.49%
Yuan-Ze University	47,499,567	1.41%
Far Eastern Memorial Foundation	44,115,478	1.31%
Yu Yuan Investment Co.,Ltd	43,268,479	1.29%
Yu Chang Investment Company	42,419,430	1.26%

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4.1.7 Market Price, Net Value, Earnings and Dividends per Share

Unit: NT$

				Unit: NT$
Item	Year		2018	2019
Market Price Per Share	Highest		45.75	48.90
	Lowest		26.70	33.55
	Average		34.10	42.62
Net Value Per Share	Before Distribution		41.02	43.45
	After Distribution		38.22	(Note)
Earnings Per Share	Weighted Average shares (in thousand)		3,139,152	3,138,664
	Earnings Per Share		3.54	5.56
Dividends Per Share	Cash Dividends		2.80	3.0(Note)
	Stock Dividend	Dividends from Retained Earnings	-	-
		Dividends from Capital Surplus	-	-
	Accumulated Unpaid Dividends		-	-
Return on Investment	Price-Earnings Ratio		9.63	7.67
	Price-Dividend Ratio		12.18	14.21
	Cash Dividend Yield Rate		8.21%	7.04%

Note : To be resolved by the 2020 Shareholders’ Meeting.

4.1.8 Dividend Policy & Implementation Status

1. Dividend Policy

Apart from paying all its income taxes in the case where there are net incomes at the end of the year, the Company shall make up for accumulated losses in past years. Where there is still balance, 10% of which shall be set aside by the Company as legal reserve and a special reserve as required by law shall be set aside. Subject to certain business conditions under which the Company may retain a portion of the remaining balance, the Company may distribute to the shareholders the remainder together with undistributed profits from previous years in proportion to the number of the shares held by each shareholder as shareholders’ dividend. However in the case of increase in the Company's share capital, the shareholders' dividend to be distributed to the shareholders of increased shares for the year shall be decided by the shareholders' meeting.

The distribution of shareholders’ dividend shall take into consideration the changes in the outlook for the Company's businesses, the lifespan of the various products or services that have an impact on future capital needs and taxation. Shareholders’ dividend shall be distributed aimed at maintaining the stability of shareholders’ dividend distributions. Save for the purposes of improving the financial structure, reinvestments, production expansion or other capital expenditures in which capital is required, when distributing shareholders’ dividend, the dividend payout ratio each fiscal year shall be no less than fifty percent (50%) of the final surplus which is the sum of after-tax profit of the fiscal year to withhold previous loss, if any, legal reserve and special reserve as required by law; the cash dividend shall not be less than 10% of the shareholders’ dividend distributed in the same year.2. Implementation Status

Hereby lists the Company's dividend in recent years as follows:

	Cash Dividend	Ratio of Total	Stock dividend	Ratio of Total	Total dividend
		Dividend		Dividend
2014	NT $2.2	100%	NT $0	0%	NT $2.2
2015	NT $1.1	100%	NT $0	0%	NT $1.1

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2016		NT $0.9	100%	NT $0	0%	NT $0.9
2017		NT $1.2	100%	NT $0	0%	NT $1.2
2018		NT $2.8	100%	NT $0	0%	NT $2.8
2019	(Proposed)	NT $3.0	100%	NT $0	0%	NT $3.0

The net income after tax for FY2019 as NT$ 17,459,673,128. After the appropriation of Legal Reserve and Special Reserve, NT$ 14,909,359,017 is left. The Broad has proposed a cash dividend of NT$ 3.0 per share, which is summed up to NT$ 10,084,341,594 in total.

4.1.9 Effects on Business Performance and EPS Resulting From Stock Dividend Distribution

Unit: NT$

			Unit: NT
Item	Year		2020Estimated)
Paid-In Capital	(Beginningof The Year)		NT$33,614,471,980
Stock＆Cash Dividend Distribution	Cash Dividend Per Share		NT$3.0
	Stock Dividend From Retained Earnings Per Share		0.00 Share
	Stock Dividend From Capital Surplus Per Share		0.00 Share
Variance In Business Performance	OperatingIncome		Not Applicable*
	% Change In OperatingIncome		〃
	Net Income		〃
	% Change In Net Income		〃
	Earnings Per Share		〃
	% Change In EPS		〃
	Average Return on Investment (%) (Reciprocal of Average P/E Ratio)		〃
Pro Forma EPS & P/E Ratio	If Retained Earnings Distributed In Cash Dividend	Pro Forma Earnings Per Share	〃
		Pro Forma Average Yearly Return on Investment	〃
	If Capital Surplus Not Distributed In Stock Dividend	Pro Forma Earnings Per Share	〃
		Pro Forma Average Yearly Return on Investment	〃
	If Retained Earnings & Capital Surplus Distributed In Cash Dividend Rather Than Stock Dividend	Pro Forma Earnings Per Share	〃
		Pro Forma Average Yearly Return on Investment	〃

As the Company does not disclose its financial forecast information, in compliance with relevant governmental regulations, there is no need to provide this information.

4.1.10 Employees’ Compensation and Directors’ and Supervisors’ Remuneration

The percentages or ranges with respect to employees' compensation and directors' remuneration as set forth in the Asia Cement Corporation's Articles of Incorporation: Pursuant to the Articles of Incorporation for distribution 1%~4% as employees' compensation and distribution less than 2.5% as directors' remuneration base on the profit of the current year. However, the company's accumulated losses shall have been covered. The company may, by a

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resolution adopted by a majority vote at a meeting of Board of Directors attended by two-thirds of the total number of directors, determine the actual ratio, amount, form (in the form of shares or in cash) and the number of shares of the profit distributable as employees’ compensation; and a report of such distribution shall be submitted to the shareholders' meeting. The actual ratio and amount of the profit distributable as directors’ remuneration shall also be determined by Board of Directors, and a report of such distribution shall be submitted to the shareholders' meeting.

(1)The basis for estimating the amount of employees' compensation and directors' remuneration: Distribution 1%~4% as employees' compensation and less than 2.5% as directors' remuneration shall be based on the profit before income tax of the current year.
(2)The number of shares to be distributed as employees’ compensation: NA
(3)The accounting treatment of the discrepancy, if any, between the actual distributed amount and the estimated figure for the current period: the difference would be regarded as accounting estimation adjustment and recognized as the profit and loss of 2020.
Information on resolved by the Board of Directors on March 25, 2020 for distribution of compensation:
(1)The amount of any compensation distributed in cash or stocks : Employees’ cash compensation is NT$ 261,064,444. Directors' cash remuneration is NT$ 230,296,135.
(2)If there is any discrepancy between that amount and the estimated are recognized for the fiscal year shall be disclosed the discrepancy amount, its cause, and the status of treatment: No discrepancy.
(3)The amount of any employees' compensation distributed in stocks, and the amount as a percentage of the sum of profit after income tax base on the separated financial report and total employees’ compensation: NA
The actual distribution of employees' compensation and directors' remuneration for the previous fiscal year (with an indication of the number of shares, amount and stock price of the shares distributed), and if there is any discrepancy between the actual distribution and the recognized employees' compensation and directors' remuneration shall be disclosed the discrepancy, its cause, and the status of treatment: The Board of Directors resolved on March 21, 2019 to distribute employees’ compensation NT$ 253,436,520 and directors’ remuneration NT$ 223,657,728. The employees' compensation and directors' remuneration was fully distributed and no discrepancy with 2018 。

separate financial report

Buyback of Treasury Stock: None.
Preferred Stock: None.
Employee Stock Option: None.
Restricted Stock Awards for employees: None.
Merger or acquisition of other company’ share to issue new share: None.

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4.2 Summary of Corporate Bonds

4.2.1 Issued Corporate Bonds

.2.1 Issued Corporate Bonds	.2.1 Issued Corporate Bonds
Type of Bond Issued Item		1st Unsecured Corporate Bond Issued in 2016	1st Unsecured Corporate Bond Issued in 2019
Date Issued		Sep.27,2016	May. 8,2019
Par Value		NT$1,000,000	NT$1,000,000
Issue and Trade Place		N/A	N/A
Issue Price		ParValue	ParValue
Nominal Amount		NT$6,000,000,000	NT$6,500,000,000
Interest Rate		0.80%	0.88%
Term		Five Years. Maturity: Sep.27,2021	Five Years. Maturity: May. 8,2024
Guaranty/Guarantor		None	None
Trustee		China Trust Commercial Bank, TrustDepartment	China Trust Commercial Bank, TrustDepartment
Underwriter		KGISecurities Co.LTD.	MasterlinkSecurities Corporation
Certified Lawyer		M.T.HUANG	M.T.HUANG
Certified Public Accountant		L.W.Kuo, Y.W.Fan	L.W.Kuo, Y.W.Fan
Repayment Method		Interest Paid Annually Since Issue, 50% Principal Installed Seperately After The 4、5th Anniversary of TheIssueDate	Repayment In Lump Sum Upon Maturity
OutstandingBalance		NT$6,000,000,000	NT$6,500,000,000
Redemption Clauses		None	None
Restrictive Covenants		None	None
Credit Rating Agency/Date/Rating		Taiwan Ratings Corporation Long term Credit Ratings: twA Short term Credit Ratings: twA-1 Outlook: Stable Bond Ratings: - Credit ratingdate: Nov.17,2015	Taiwan Ratings Corporation Long term Credit Ratings: twA+ Short term Credit Ratings: twA-1 Outlook: Stable Bond Ratings: - Credit ratingdate: Sep.19,2018
Convertible	Amount Converted	None	None
	Issue/ Conversion Rules	None	None
Terms to issuance, conversion, exchange and subscription. The impacts to current shareholder equityandpotential dilutions.		None	None
Custodian		None	None

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Type of Bond Issued Item	Type of Bond Issued Item	2nd Unsecured Corporate Bond Issued in 2019	1st Unsecured Corporate Bond Issued in 2020
Date Issued		Aug.16,2019	Apr.20,2020
Par Value		NT$1,000,000	NT$1,000,000
Issue and Trade Place		N/A	N/A
Issue Price		ParValue	ParValue
Nominal Amount		NT$3,500,000,000	NT$7,700,000,000
Interest Rate		0.79%	0.66%
Term		Five Years. Maturity: Aug.16,2024	Five Years. Maturity: Apr.20,2025
Guaranty/Guarantor		None	None
Trustee		China Trust Commercial Bank, TrustDepartment	China Trust Commercial Bank, TrustDepartment
Underwriter		Yuanta Securities Co.,Ltd.	Yuanta Securities Co.,Ltd.
Certified Lawyer		M.T.HUANG	M.T.HUANG
Certified Public Accountant		X.W.Tai, Y.W.Fan	X.W.Tai, Y.W.Fan
Repayment Method		RepaymentIn Lump SumUpon Maturity	RepaymentIn Lump SumUpon Maturity
OutstandingBalance		NT$3,500,000,000	NT$7,700,000,000
Redemption Clauses		None	None
Restrictive Covenants		None	None
Credit Rating Agency/Date/Rating		Taiwan Ratings Corporation Long term Credit Ratings: twA+ Short term Credit Ratings: twA-1 Outlook: Stable Bond Ratings: - Credit ratingdate: Sep.19,2018	Taiwan Ratings Corporation Long term Credit Ratings: twA+ Short term Credit Ratings: twA-1 Outlook: Stable Bond Ratings: - Credit ratingdate: Oct.23,2019
Convertible	Amount Converted	None	None
	Issue/ Conversion Rules	None	None
Terms to issuance, conversion, exchange and subscription. The impacts to current shareholder equityandpotential dilutions.		None	None
Custodian		None	None

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Type Of Bond Issued Item	Type Of Bond Issued Item	2ndOverseas Unsecured Convertible Bonds	3rdOverseas Unsecured Convertible Bonds
Date Issued		May. 13,2013	Sep. 21,2018
Par Value		US$200,000 and in increments of US$1,000 thereafter	US$200,000 and in increments of US$1,000 thereafter
Issue And Trade Place		Singapore Exchange	Singapore Exchange
Issue Price		Par Value	Par Value
Nominal Amount		US$220,000,000	US$215,000,000
Interest Rate		0%	0%
Term		Five Years Maturity: May. 13,2018	Five Years Maturity: Sep. 21,2023
Guaranty/Guarantor		None	None
Trustee		BNY Mellon	BNY Mellon
Underwriter		Goldman Sachs International	UBS AG HongKongBranch
Certified Lawyer		Y.H. Wang	Y.H. Wang
Certified Public Accountant		X.W. Tai,L.W. Kuo	L.W. Kuo,Y.W. Fan
Repayment Method		Unless previously redeemed, repurchased and cancelled or converted, the bonds will be redeemed at their principal amount on the maturity date.	Unless previously redeemed, repurchased and cancelled or converted, the bonds will be redeemed at their principal amount with a yield calculated at the rate of 0.6% per annum on the maturitydate.
Outstanding Balance		Dec. 31, 2017: US$3,000,000 May. 13,2018: US$0	US$215,000,000
Redemption Clauses		A. The Issuer may redeem the bonds at the option of the Issuer in whole or in part at any time after three years of the issue date at the principal amount, if the closing price for 30 consecutive trading days (in the event of ex-rights or ex-dividends, the closing price on each applicable trading days during the period from the ex-rights or ex-dividends trading day to the ex-rights or ex-dividends record date, as the case may be, shall be adjusted to the price taking into account of impact of the ex-rights or ex-dividends) of the Issuer’s common shares on the TSE is at least 130% of the quotient of the principal amount multiply by the then conversion price divided by the principal amount of the bonds. B. The Issuer may redeem all of the bonds at the principal amount in the event that at least 90% of the bonds have been previously redeemed, repurchased and cancelled or converted. C. The Issuer may redeem all of the bonds at principal amount in the event of changes in ROC taxation resulting in increase of tax obligation or the necessity to pay additional interest expense or increase of additional costs to the Issuer.	A. The Issuer may redeem the Bonds at the option of the Issuer in whole or in part at any time after three years of the Issue Date at the Early Redemption Price, if the closing price for 30 consecutive trading days (in the event of ex-rights or ex-dividends, the closing price on each applicable trading days during the period from the ex-rights or ex-dividends trading day to the ex-rights or ex-dividends record date, as the case may be, shall be adjusted to the price taking into account of impact of the ex-rights or ex-dividends) of the Issuer’s common shares on the TSE is at least 130% of the amount, which is the price of Early Redemption Price multiplied by the then Conversion Price divided by the principal amount of the Bonds; B. The Issuer may redeem all of the Bonds at the Early Redemption Price in the event that at least 90% of the Bonds have been previously redeemed, repurchased and cancelled or converted. C. The Issuer may redeem all of the Bonds at the Early Redemption Price in the event of changes in ROC taxation resulting in increase of tax obligation or the necessity to pay additional interest expense or increase of additional costs to the Issuer.
Restrictive Covenants		None	None
Credit Rating Agency/Date/Rating		None	None
Convertible	Amount Converted	None	None

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	Issue/ Conversion Rules	Except for closed periods as prescribed by ROC laws and regulations or otherwise described in the Indenture, the bondholders shall have the right to require the Issuer to convert the bonds into the converted securities at any time during the period from the 41th day after the issuance of the bonds to the date falling 30th day prior to the maturity date. The aforementioned closed periods shall mean: A. The Issuer has to close its shareholders' register, which period currently includes 60 days prior to the date of the annual general shareholders' meeting, 30 days prior to a special shareholders' meeting, or any other period prescribed by law. B. In the event of free distribution of shares, distribution of cash dividends or rights issues, by Issuer, the period from the fifteen trading days prior to the commencement day of the closed period with respect to the record date for determination of shareholders entitled to receive dividends, subscription of new shares or other benefits to the record date for the distribution or allocation of the relevant dividends, rights and benefits, and in the event of capital reduction, the period from the record date for determination of the shareholders participating in such capital reduction to the first trading day immediately prior to the date on which the common shares resume trading after such capital reduction and other closed period as required by ROC laws and regulations or by the TSE. C. Where any ROC laws and regulations governing closed period as above-mentioned has been changed or amended, the closed period shall be amended to comply with the prevailing laws and regulations.	Except for closed periods as prescribed by ROC laws and regulations or otherwise described in the Indenture, the bondholders shall have the right to require the Issuer to convert the bonds into the converted securities at any time during the period from the next day immediately after the end of a three-month period following the Issue Date to 30th day prior to the Maturity Date. The aforementioned closed periods shall mean: A. The period during which under the laws of the ROC the Issuer has to close its shareholders' register, which period currently includes 60 days prior to the date of the annual general shareholders' meeting, 30 days prior to a special shareholders' meeting, or any other period prescribed by law. B. In the event of free distribution of shares, distribution of cash divided or rights issues, the period from the fifteen trading days prior to the commencement day of the closed period with respect to the record date for determination of shareholders entitled to receive dividends, subscription of new shares or other benefits to the record date for the distribution or allocation of the relevant dividends, rights and benefits. C. In the event of capital reduction, the period from the record date for determination of the shareholders participating in such capital reduction to the first trading day immediately prior to the date on which the Common Shares resume trading after such capital reduction. D. Other closed period as required by ROC laws and regulations or by the TSE. E. Where any ROC laws and regulations governing closed period as above-mentioned has been changed or amended, the closed period shall be amended to comply with the prevailing laws and regulations.
Terms to issuance, conversion, exchange and subscription. The impacts to current shareholder equity and potential dilutions.		The 2ndoverseas unsecured convertible bonds with a zero coupon rate, the bonds provide a low-cost source of long-term funds and reduce the interest expenses, and therefore have a positive boost on the Issuer'sprofitability.	The 3rdoverseas unsecured convertible bonds with a zero coupon rate, the bonds provide a low-cost source of long-term funds and reduce the interest expenses, and therefore have a positive boost on the Issuer'sprofitability.
Custodian		None	None

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4.2.2 Issued Exchangeable Bonds and Convertible Bonds

Type of Bonds Issued	Type of Bonds Issued	2ndOverseas Unsecured Convertible Bonds	2ndOverseas Unsecured Convertible Bonds	2ndOverseas Unsecured Convertible Bonds	2ndOverseas Unsecured Convertible Bonds	2ndOverseas Unsecured Convertible Bonds	2ndOverseas Unsecured Convertible Bonds	2ndOverseas Unsecured Convertible Bonds
Item	Year	Launch Date	2013	2014	2015	2016Note1	2017	Jan. 1, 2018 to May. 13, 2018 Note3
Market Price of Convertible Bonds(US$)	Highest	100	105.71	108.12	104.68	101.10	100.16	99.83
	Lowest	100	98.10	101.27	98.08	98.61	98.73	99.28
	Average	100	101.52	103.83	100.50	99.70	99.49	99.60
Conversion Price/Share		48	44.7	42	39.28	37.85	36.6Note2	36.6
Issuing (handling) date and conversionprice in issuing		Issued on May. 13, 2013 NT$48/share
Method of performing conversion obligations		Issuance of new shares

Note1: Pursuant to the Indenture, any holders of the bonds may exercise the holders’ Put Right to require the company to redeem the bonds held by the holders in whole or in part only on 13 May 2016. As of the date of redemption, the total redemption amount is US$217,000,000, and the outstanding balance is US$3,000,000.

Note2: Pursuant to the Indenture, the conversion price of the bonds had been adjusted to NT$36.6/Share since September 6, 2017 as ACC distributed cash dividends and stock dividends.

Note3: After final redemption on May. 13, 2018, there is no outstanding balance.

Type of Bonds Issued	Type of Bonds Issued	3rdOverseas Unsecured Convertible Bonds	3rdOverseas Unsecured Convertible Bonds	3rdOverseas Unsecured Convertible Bonds	3rdOverseas Unsecured Convertible Bonds
Item	Year	Launch Date	2018	2019	From the current year to March. 31,2020
Market Price of Convertible Bonds(US$)	Highest	100	107.07	126.37	129.09
	Lowest	100	99.23	101.38	104.49
	Average	100	102.37	111.90	120.15
Conversion Price/Share		42.24	42.24	39.7Note1	39.7
Issuing (handling) date and conversionprice in issuing		Issued on September. 21, 2018 NT$42.24/share
Method of performing conversion obligations		Issuance of new shares

Note1: Pursuant to the Indenture, the conversion price of the bonds had been adjusted to NT$39.7/Share since July 31, 2019 as ACC distributed cash dividends and stock dividends.

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4.3 Summary of Issued GDR

Issue Date	Issue Date	Issue Date	Jun. 23,1992	Sep. 13,1996	Jan. 23,2007	Mar. 25,2008
Issuance & Listing			London Stock Exchange
Total Amount(US$)			66,002,750	60,000,010.77	83,209,951.46	61,355,000
IssuingPriceper GDR(US$)			27.50	19.67	9.905946602	17.53
Number of GDR Issued			2,400,100	3,050,331	8,400,000	3,500,000
Underlying Securities			ACC Common Shares held by Far Eastern New Century Corporation	ACC Common Shares held by Far Eastern New Century Corporation	ACC Common Shares held by Yuang Ding Investment Corporation	ACC Common Shares held by Far Eastern General Contractor Co., Ltd. and Far Eastern Construction Co., Ltd.
Common Shares Represented (shares)			24,001,000	30,503,310	84,000,000	35,000,000
Right & Obligation of GDR Holders			Same as Common Shareholders
Trustee			Not Applicable
DepositaryBank			BNY Mellon
Custodian			Far Eastern International Bank
Outstanding			22,273(As of March 31,2020)
Apportionment of Expenses for Issuance & Maintenance			All expenses related to issuance and maintenance is undertaken by FENC and ACC respectively.
Major Commitment of Depositary Agreement & CustodyAgreement			GDR holders are allowed to vote on a given agenda only when over 51% of them reach consensus.
Closing Price Per GDR (US$)	2019	Highest	11.9
		Lowest	11.9
		Average	11.9
	As of March 31,2020	Highest	11.9
		Lowest	11.9
		Average	11.9

＊Each GDR represented 10 Common Shares.

4.4 Status on Execution of Capital Utilization Plans

Funds utilization plans have not been completed or have been completed in past 3 years but their benefits have not been appeared: none.

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V Overview of Business Operation

5.1 Business Introduction

5.1.1 Business Scope

Scope of Business: Please refer to Section 2.1: “Scope of Business.”
Main Business and Percentage:
A. Production and sales of Cement and clinker: 96%.
B. Granulated blast-furnace slag: 4%.
New Product Research & Development: None.

5.1.2 Industry Overview

Market situation and future outlook
A. The 2019 total cement production volume in Taiwan was 11,267,211 MT, increased 3% compared to 2018. Among them, the domestic cement sales was 9,054,712 MT, and exported cement was 2,321,014 MT. Compared with those in 2018, domestic sales increased by 5.6%, exports decreased by 2.43%. In 2019, the domestic real estate market showed slight growth. Compared with 2018, the price and trading volume of the real estate market showed a stable trend. The cement consumption increased to 11,350,017 MT, increased by 6.53%. The 2019 per capita average cement consumption is about 482 kg, increased 10.80% from 435 kg in 2018. As a result, the cement market in Taiwan is still showing oversupply.
B. For the year 2020:
- (1) Outlook of the domestic market:

With the coronavirus spreading across the world and the international oil price crashing in 2020, the global financial market was jolted. Despite emergency rate cut and QE measures taken by Fed and central banks of many countries, the market panic continued, which resulted in the lowering of the economic growth rate of all the countries. For example, the 2020 growth rate of the United States is expected to decline by 5.38%; the first-quarter growth rate of mainland China in 2020 is estimated to drop by 7.59% and 2.04% for the whole year; the 2020 growth rate of the Euro zone is estimated to be -4.61%. The global economy is showing a recessive trend.

In Taiwan, economic growth performance is facing a severe test. According to the forecast released by the Chung-Hua Institution for Economic Research in April 2020, the GDP growth rate in 2020 will be revised down to 1.03%, which is 1.68% lower than 2.71% in 2019. In order to revitalize the domestic market, the government will accelerate the implementation of various public construction to expand domestic demand, and set a target of 95% expenditure for the public construction budget. In addition, the total budget for 2020 is NT$ 164.6 billion for public construction and design, plus a special budget for forward-looking infrastructure NT$ 100.5 billion, and operating and non-operating special funds for TW$ 201.9 billion, totaling TW$ 467

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billion, increased NT$ 81.8 billion or 21.3% compared with 2019

In terms of real estate, the number of houses transaction in the housing market in 2019 was 300,275, an increase of 8% compared to those in 2018. This is the first time in 5 years to reach 300,000, and to grow for three consecutive years since 2017 years. In 2020, the fundamentals of the housing market have maintained a stable because of housing need. However, it would be affected under the influence and uncertainty of the coronavirus. Meanwhile, driven by the government's accelerated implementation of public projects, the total cement demand is expected to remain the same as last year.

(2) Outlook of the global markets:

For the outlook of 2020, the global market saw a shrinkage due to the COVID-19 pandemic as many countries implemented the lockdown policy, which affected the international cement prices. Fortunately, the Chinese market picked up slowly from April with a bullish demand for the second half of the year. This will trigger the rise of cement clinker prices. In the international market, exports from Eastern Asian and Southeastern Asian countries was affected as they stopped operation of the kilns and reduced production as they were hit hard by the coronavirus pandemic. The production is expected to come back to normal after the third quarter and Japan will largely increase it exports as the Olympic Games are postponed to a year later. The rebound of the U.S. and European markets will be dependent on the control of the pandemic. The western U.S. and Hawaiian markets to which Asia Cement supplies have been impacted only temporarily thanks to the economic policies maintained by the local governments. Asia Cement will shift part of its export from the declined Southeastern Asian market to western U.S. to maintain its export contribution. In addition, Asia Cement will continue to cooperate with the government’s export policy for the cement industry by keeping the export volume under the upper limit prescribed by the policy and supplying to few long-term markets. To maintain its business profits, Asia Cement will actively purchase cement, clinker, plaster and silicon sands from other countries and supply them to the Southeastern Asian market. For the year 2020, Asia Cement will continue with its export strategy to maintain the export volume from Taiwan and expand the raw material business.

Overall, the domestic market will rise slightly, while foreign markets have growth potential

C. In addition to root in Taiwan for on-going cement business operation, the Company will keep enhancing its competitiveness by largely expansion in China both in production and sales.
The relationships among the value chain of cement industry

The upstream, midstream and downstream sectors of cement industry, namely ready-mixed concrete, precast, and construction industry, are co-existed and blooming together. Nowadays, vertical integration is the trend in cement industry. As a result, the Company’s operation － strategy is to establish the downstream subsidiaries Ya Tung Ready-mixed Concrete Corp. and Yali Precast & Prestressed Concrete Industries Corp., and to invest Far Eastern Construction Company and Far Eastern General Contractor Company to grasp the business

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opportunities.

3. Product development and company competitiveness

Although the cement products include Portland Cement Type I, Type II, and Special Cement, the major market demand is Portland Cement Type I. However, the overseas market has stronger demand for Special Cement in recent years. The ability to produce quality products and the shipping & loading efficiency has become the key competitive factors.

5.1.3 Technology and Research Development

As of April 30, 2020 Unit: NT$1,000

Item	Amount
Industrial 4.0 project
- Intelligent shipment - Analysis and forecasting to kiln refractory	5,000
- Intelligent quality control
Industrial 4.0 Project Phase 2:
- Cloud War Room
- Product Line Machine Predictive Maintenance	4,000
- Intelligent Mining
Big Data Analysis - Predictive Analysis Project	1,000
Analysis Method for Cement Hydration Heat	100
Hualien Plant No. 2 and No. 3 rotary kiln alternative fuel using system project	82,650
No.1 cement mill rolling machine hydraulic system update	2,900
No.3 cement mill rolling machine hydraulic system update	3,100
No.3 cement mill PLC system update	9,500
Secondary Crushing Equipment PLC system update	4,200
Geological and Detailed Investigation (Scale 1/1200) in Xinchengshan Quarry	3,450
Quarry blasting vibration monitoring work	530
Total	119,430

5.1.4 Short-term Business Plan

To strengthen the existing domestic and international channels of cement sales.
To reduce costs and to maintain fully sell out the estimated production volume and sound profitability.
To fulfill the vertical integration policy and to expand into downstream market channels.
To keep good relationship with customers and foresee market trend.

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5.1.5 Long-term Business Plan

Maintain solid position in Taiwan - improve producing efficiency.
Increase the investment in China (Please refer to the “I Report to Shareholders” at page 1 and the “8.2 Basic Information of Affiliates” at section 8.2 of this annual report.
Extend the global market - Find new markets, new opportunities to expand overseas operations.

5.2 General Information of Market & Production

5.2.1. Markets Analysis

Major Sale Markets
A. Cement and Clinker:

“Skyscraper” is the Company’s brand-name for marketing all kinds of our products. Our domestic market includes Taiwan, Penghu, Kinmen and Matsu, and our overseas market includes United States, Philippine, Malaysia, Hawaii, Guam, Singapore, etc.

B. Ready-Mixed Concrete:

To provide better customer service, our subsidiary, Ya Tung Ready-Mixed Concrete Corp., has set up many plants around Taiwan, and furthermore established strategic alliance with local firms.

Market Share

In 2019, the Company domestic sales was 2,564,176 MT, i.e. 28.32% of the sales amount of all domestic cement producers, which was equal to 22.59% of total cement consumption in Taiwan.

Market supply forecast, growth opportunity, and business competitiveness:
A. According to the prediction of the Chung-Hua Institution for Economic Research, due to the impact of the coronavirus epidemic in 2020, Taiwan’s GDP growth rate would be 1.03%, a significant decrease of 1.68% compared with last year. Taiwan Institute of Economic Research investigated that the domestic real estate developers estimated that the epidemic will affect the public’s willingness to buy houses. As a result, the progress of new developing case would be delayed, which may cause the future transaction volume to be less than expected. Some real estate investors are pessimistic about the future. However, in order to expand domestic demand, the government will accelerate the progress of public works. Overall, the demand for private construction projects is expected to decrease in 2020, but the amount of public works will increase, and the domestic demand for the whole year is expected to be the same to 2019. In addition, energy, raw materials, labor costs, sea freight prices and the quantity of imported cement are other important factors that affect sales.
B. For the export sales, the Company is expected to export 1.1~1.1 million MT of cement and clinker in 2020, which is equivalent to 2019. The Company has long term major customers in Philippine, Malaysia, Hawaii, etc. and shall continue to maintain an excellent business relationship with them in the years to come. The Company has also expanded its trading business for cement.
C. In the view of the vast and steady growth market in China, Asia Cement Corporation actively expands production base as well as storage and transportation facilities. In addition,

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with the markets both in Taiwan and China, it constitutes an effective competitive niche and profitability for the Company.

Positive factors for the industry development
A. In response to the impact of Covid19, Taiwan Government are promoting industrial innovation, forward-looking infrastructure construction, improving the quality of public construction, and regional balanced development.
B. The budget (including special budget) for 2020 Public Works Projects increase 21.3% to NT $467 billion. Taiwan’s cement industry believes that the implementations of several infrastructure projects will drive private investment.
C. In 2019, the floor area of the application for the building license increased by 9% compared with 2018, indicating that the private investment continued to expand. Moreover, the number and amount of overseas Taiwanese businesses to return to invest in Taiwan continued to increase. Taiwan government also accelerated house reconstruction, urban renewal, and implemented the public construction. All these help to increase domestic construction investment. However, affected by the Covid19 epidemic, the future uncertainty is high.
D. The Ministry of Finance announced in February 2017 to continue to levy cement and clinker from China at the original approved tax rate of 91.58% anti-dumping duties for five years. This will help stability of the domestic industry.
Negative factors and the solutions
A. Industry relocation, environmental awareness, and emission limits of carbon dioxide will increase the difficulties in both public constructions and private housing sectors, and cause the construction industry more conservative. This will constrain the growth of cement demand.
B. The Ministry of Economic Affairs has set limitations on trade volume of domestic cement industry according the Foreign Trade Law. The limitations will gradually lower the export-production ratio from 50% in 2011 to 25% in 2020. The over-supply condition will be worse.
C. Mining Industry Law is currently in the occasion of amending, the industry will face more stringent operating requirements and limitations.
D. Limestone tax is raised from NT$ 10 to NT$ 70 per metric ton. As well as the recent rise in coal prices will bring to the cement industry to more difficult condition.
E. Solutions:
- Improve the efficiency of current production, transportation and marketing activities and strengthen the downstream distribution channels in both domestic and overseas market. Continue selecting good target markets, establish production and distribution channels, expand customers in emerging countries, and realize reasonable profitability.

5.2.2 Application of Major Cement Products

Portland Cement Type I:

It is known as ordinary cement, used for all structural projects which are not particularly exposed to sulphuric acid or underground water. Most of the current market supply is in this category.

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2. Portland Cement Type II:

With lower hydration heat than Portland Cement Type I as well as low alkalis and moderate resistance to sulfate, Portland Cement Type II is for large-scale structures. It is resistant against cracking and erosion by sea water, salt, and alkali. The general purposes are as follows:
A. Underground foundation engineering: Tower Building Basement, underpass, sewers, tunnels and massive underground rapid transit systems.
B. Large-scale concrete works: Bridges, dams, water retention facilities, valve based structure.
C. Construction subject to erosion by sea water and sea wind: dock, breakwaters, caisson, breeding plants, harbors, and others.
D. Project that requires resistance to sulfate: Sewage treatment plants and chemical engineering.
Special Purpose Cement: Produced to meet customers’ special needs.
Production process:
All types of cement are produced in accordance to a fixed proportion of mixtures, in the following steps:
A. Limestone and clay are mixed and ground into raw meal.
B. Raw meal is poured into the rotary kiln and burned in high temperature to produce clinker.
C. Clinker is mixed with gypsum and ground into cement.
D. Cement is sold in bulk or packages.

5.2.3 Supply Condition of Main Raw Materials

The major raw materials used by the Company consist of limestone, clay, gypsum, pyrite, iron slag, and raw coal for fuel. Except a little limestone, most limestone is produced and used by the Company. Clay is purchased from domestic suppliers through long-term contracts. Gypsum and pyrite are supplied by qualified domestic and foreign firms. Fuel coal is supplied by Australian providers via long or short term contracts.

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5.2.4 Major Suppliers Information for the Last Two Years Unit: NT$1,000 2018 2019 Item Company Name Amount % Relation with Issuer Company Name Amount % Relation with Issuer 1 BB Co.,Australia 1,579,103 46.29Raw material supplier BB Co.,Australia 853,694 32.23 Raw material supplier 2 ChungLingCo. 468,335 13.73 Raw material supplier ChungLingCo. 498,363 18.82 Raw material supplier 3 AA Co., Australia 229,872 6.74 Raw material supplierYoung Year (Gypsum) 77,521 2.93 Raw material supplier 4 KENWAY 74,989 2.20 Equipment supplier Anhe Engineering 76,337 2.88 Equipment supplier Others 1,058,698 31.04 Others 1,142,578 43.14 Net Total Supplies 3,410,997 100.00 Net Total Supplies 2,648,493 100.00 Note: Variations are because of market mechanisms. 5.2.5 Major Clients Information for the Last Two Years Unit: NT$1,000	5.2.4 Major Suppliers Information for the Last Two Years Unit: NT$1,000 2018 2019 Item Company Name Amount % Relation with Issuer Company Name Amount % Relation with Issuer 1 BB Co.,Australia 1,579,103 46.29Raw material supplier BB Co.,Australia 853,694 32.23 Raw material supplier 2 ChungLingCo. 468,335 13.73 Raw material supplier ChungLingCo. 498,363 18.82 Raw material supplier 3 AA Co., Australia 229,872 6.74 Raw material supplierYoung Year (Gypsum) 77,521 2.93 Raw material supplier 4 KENWAY 74,989 2.20 Equipment supplier Anhe Engineering 76,337 2.88 Equipment supplier Others 1,058,698 31.04 Others 1,142,578 43.14 Net Total Supplies 3,410,997 100.00 Net Total Supplies 2,648,493 100.00 Note: Variations are because of market mechanisms. 5.2.5 Major Clients Information for the Last Two Years Unit: NT$1,000	5.2.4 Major Suppliers Information for the Last Two Years Unit: NT$1,000 2018 2019 Item Company Name Amount % Relation with Issuer Company Name Amount % Relation with Issuer 1 BB Co.,Australia 1,579,103 46.29Raw material supplier BB Co.,Australia 853,694 32.23 Raw material supplier 2 ChungLingCo. 468,335 13.73 Raw material supplier ChungLingCo. 498,363 18.82 Raw material supplier 3 AA Co., Australia 229,872 6.74 Raw material supplierYoung Year (Gypsum) 77,521 2.93 Raw material supplier 4 KENWAY 74,989 2.20 Equipment supplier Anhe Engineering 76,337 2.88 Equipment supplier Others 1,058,698 31.04 Others 1,142,578 43.14 Net Total Supplies 3,410,997 100.00 Net Total Supplies 2,648,493 100.00 Note: Variations are because of market mechanisms. 5.2.5 Major Clients Information for the Last Two Years Unit: NT$1,000	5.2.4 Major Suppliers Information for the Last Two Years Unit: NT$1,000 2018 2019 Item Company Name Amount % Relation with Issuer Company Name Amount % Relation with Issuer 1 BB Co.,Australia 1,579,103 46.29Raw material supplier BB Co.,Australia 853,694 32.23 Raw material supplier 2 ChungLingCo. 468,335 13.73 Raw material supplier ChungLingCo. 498,363 18.82 Raw material supplier 3 AA Co., Australia 229,872 6.74 Raw material supplierYoung Year (Gypsum) 77,521 2.93 Raw material supplier 4 KENWAY 74,989 2.20 Equipment supplier Anhe Engineering 76,337 2.88 Equipment supplier Others 1,058,698 31.04 Others 1,142,578 43.14 Net Total Supplies 3,410,997 100.00 Net Total Supplies 2,648,493 100.00 Note: Variations are because of market mechanisms. 5.2.5 Major Clients Information for the Last Two Years Unit: NT$1,000	5.2.4 Major Suppliers Information for the Last Two Years Unit: NT$1,000 2018 2019 Item Company Name Amount % Relation with Issuer Company Name Amount % Relation with Issuer 1 BB Co.,Australia 1,579,103 46.29Raw material supplier BB Co.,Australia 853,694 32.23 Raw material supplier 2 ChungLingCo. 468,335 13.73 Raw material supplier ChungLingCo. 498,363 18.82 Raw material supplier 3 AA Co., Australia 229,872 6.74 Raw material supplierYoung Year (Gypsum) 77,521 2.93 Raw material supplier 4 KENWAY 74,989 2.20 Equipment supplier Anhe Engineering 76,337 2.88 Equipment supplier Others 1,058,698 31.04 Others 1,142,578 43.14 Net Total Supplies 3,410,997 100.00 Net Total Supplies 2,648,493 100.00 Note: Variations are because of market mechanisms. 5.2.5 Major Clients Information for the Last Two Years Unit: NT$1,000	5.2.4 Major Suppliers Information for the Last Two Years Unit: NT$1,000 2018 2019 Item Company Name Amount % Relation with Issuer Company Name Amount % Relation with Issuer 1 BB Co.,Australia 1,579,103 46.29Raw material supplier BB Co.,Australia 853,694 32.23 Raw material supplier 2 ChungLingCo. 468,335 13.73 Raw material supplier ChungLingCo. 498,363 18.82 Raw material supplier 3 AA Co., Australia 229,872 6.74 Raw material supplierYoung Year (Gypsum) 77,521 2.93 Raw material supplier 4 KENWAY 74,989 2.20 Equipment supplier Anhe Engineering 76,337 2.88 Equipment supplier Others 1,058,698 31.04 Others 1,142,578 43.14 Net Total Supplies 3,410,997 100.00 Net Total Supplies 2,648,493 100.00 Note: Variations are because of market mechanisms. 5.2.5 Major Clients Information for the Last Two Years Unit: NT$1,000	5.2.4 Major Suppliers Information for the Last Two Years Unit: NT$1,000 2018 2019 Item Company Name Amount % Relation with Issuer Company Name Amount % Relation with Issuer 1 BB Co.,Australia 1,579,103 46.29Raw material supplier BB Co.,Australia 853,694 32.23 Raw material supplier 2 ChungLingCo. 468,335 13.73 Raw material supplier ChungLingCo. 498,363 18.82 Raw material supplier 3 AA Co., Australia 229,872 6.74 Raw material supplierYoung Year (Gypsum) 77,521 2.93 Raw material supplier 4 KENWAY 74,989 2.20 Equipment supplier Anhe Engineering 76,337 2.88 Equipment supplier Others 1,058,698 31.04 Others 1,142,578 43.14 Net Total Supplies 3,410,997 100.00 Net Total Supplies 2,648,493 100.00 Note: Variations are because of market mechanisms. 5.2.5 Major Clients Information for the Last Two Years Unit: NT$1,000	5.2.4 Major Suppliers Information for the Last Two Years Unit: NT$1,000 2018 2019 Item Company Name Amount % Relation with Issuer Company Name Amount % Relation with Issuer 1 BB Co.,Australia 1,579,103 46.29Raw material supplier BB Co.,Australia 853,694 32.23 Raw material supplier 2 ChungLingCo. 468,335 13.73 Raw material supplier ChungLingCo. 498,363 18.82 Raw material supplier 3 AA Co., Australia 229,872 6.74 Raw material supplierYoung Year (Gypsum) 77,521 2.93 Raw material supplier 4 KENWAY 74,989 2.20 Equipment supplier Anhe Engineering 76,337 2.88 Equipment supplier Others 1,058,698 31.04 Others 1,142,578 43.14 Net Total Supplies 3,410,997 100.00 Net Total Supplies 2,648,493 100.00 Note: Variations are because of market mechanisms. 5.2.5 Major Clients Information for the Last Two Years Unit: NT$1,000	5.2.4 Major Suppliers Information for the Last Two Years Unit: NT$1,000 2018 2019 Item Company Name Amount % Relation with Issuer Company Name Amount % Relation with Issuer 1 BB Co.,Australia 1,579,103 46.29Raw material supplier BB Co.,Australia 853,694 32.23 Raw material supplier 2 ChungLingCo. 468,335 13.73 Raw material supplier ChungLingCo. 498,363 18.82 Raw material supplier 3 AA Co., Australia 229,872 6.74 Raw material supplierYoung Year (Gypsum) 77,521 2.93 Raw material supplier 4 KENWAY 74,989 2.20 Equipment supplier Anhe Engineering 76,337 2.88 Equipment supplier Others 1,058,698 31.04 Others 1,142,578 43.14 Net Total Supplies 3,410,997 100.00 Net Total Supplies 2,648,493 100.00 Note: Variations are because of market mechanisms. 5.2.5 Major Clients Information for the Last Two Years Unit: NT$1,000
	2018				2019
Item	Company Name	Amount	%	Relation with Issuer	Company Name	Amount	%	Relation with Issuer
1	Ya Tung Ready-Mixed Concrete Co.	1,582,083	18.95	Subsidiary	Ya Tung Ready-Mixed Concrete Co.	1,805,262	20.99	Subsidiary
	Others	6,766,506	81.05		Others	6,794,161	79.01
	Net Sales	8,348,589	100.00		Net Sales	8,599,423	100.00
Note: Variations are because of market mechanisms.

5.2.6 Output of Main Products 2018-2019

1. ACC (Taiwan)

Unit: NT $1,000, Cement and Clinker 1,000 MT

Year Output Product		2018	2018	2019	2019	2019
	Capacity	Production Volume	Production Value	Capacity	Production Volume	Production Value
Cement & Clinker	5,597	3,555	7,256,280	5,597	3,630	7,348,535

2. ACC (China)

Unit: NT $1,000, Cement and Clinker 1,000 MT

Year Output Product	2018	2018	2018	2019	2019	2019
	Capacity	Production Volume	Production Value	Capacity	Production Volume	Production Value
Cement & Clinker	35,500	30,528	27,702,318	35,500	30,501	27,536,086

5.2.7 Sales of Main Products 2018-2019

ACC (Taiwan)

Unit: NT $1,000, Cement and Clinker 1,000 MT

Year Sales Product	2018	2018	2018	2018	2019	2019	2019	2019
	Domestic Sales		Export Sales		Domestic Sales		Export Sales
	Volume	Value	Volume	Value	Volume	Value	Volume	Value
Cement & Clinker*	2,584	5,754,142	928	1,481,856	2,608	5,792,210	1,039	1,835,779

Cement & Clinker produced by the Company.

2. ACC (China)

Unit: NT $1,000, Cement and Clinker 1,000 MT

Year Sales Product	2018	2018	2018	2018	2019	2019	2019	2019
	Domestic Sales		Export Sales		Domestic Sales		Export Sales
	Volume	Value	Volume	Value	Volume	Value	Volume	Value
	30,676	46,803,136	219	242,168	30,781	49,729,598	57	64,312
Cement & Clinker*

Cement & Clinker produced by the Company.

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4.4Human Resources

	Year	2018	2019	As of Mar. 31, 2020
Number of Employees	Headquarter	149	152	151
	Hsinchu Plant	30	29	29
	Hualien Plant	305	306	309
	Total	484	487	489
Average Age		47.92	46.37	45.87
Average	Years of Service	21.48	18.06	17.25
Education	Ph.D.	0	0	0
	Masters	15.70%	16.43%	16.97%
	Bachelor’s Degree	46.69%	47.64%	47.85%
	Senior High School	33.27%	31.62%	31.08%
	Below Senior High School	4.34%	4.31%	4.09%

5.4 Expenditures on Environmental Protection

Unit: NT$ 1,000

		Unit: NT$ 1,000
Items		Amount
1	Green vegetation and maintenance for quarry	24,160
2	Other	53,567
Total		194,610

According to government regulations, the Company set up the continuous emission monitoring system to monitor pollutant opacity of nitrogen oxides, sulfur oxides, and other pollutants.

During the most recent fiscal year and the current fiscal year up to the printing date of the annual report, the loss (including compensation) and penalty resulted from environmental pollution:

(1) Fine: NT$ 100,000.

(2) Reasons:

The Hualien County Environmental Protection Bureau visited the Hualien Plant on March 15, 2019 to check the sulfur content of heavy fuel oil. The inspection result was 0.6%, exceeding the limit of 0.5%, which violated Article 29, paragraph 1, of the Air Pollution Control Law.

(3) Countermeasures:

The heavy oil in the oil tank is pumped out and shipped back to CPC Petroleum Corporation. Then CPC Petroleum Corporation resends the low-sulfur heavy oil to the heavy oil tank of Hualien Plant through the oil pipe. After the oil change, the sulfur content of the heavy oil in stock has met the regulations.

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The restriction of RoHS (to restrict the use of hazardous chemicals) is not applicable to the Company.

5.4.1 ISO-14001 Environmental Management Systems (EMS)

ISO-14001 EMS has become the trend in many advanced countries.
In August 1996, the Hualien plant of the Company passed certification by the Bureau of Commodity Inspection and Quarantine of the Ministry of Economic Affairs (MOEA), and in November of the same year, Hualien plant became one of the first organizations in Taiwan to receive ISO-14001 certification. In July 2000, Taiwan’s first Environmental Report was completed by Hualien plant according to Sustainability Reporting Guidelines of Global Reporting Initiative (GRI).
The affiliated Jiangxi Yadong Cement Co., Sichuan Yadong Cement Co., Hubei Yadong Cement Co., Huanggang Yadong Cement Co., and Wuhan Yaxin Cement Co., have awarded ISO-14001 certification.

5.4.2 Air Pollution Prevention

One of the main environmental concerns relating to cement production is air pollution caused by the dust generated from production processes. Therefore, the work of dust disposal is an important duty, not only to prevent air pollution, but also to reduce the loss of raw materials and finished products. Consequently, ACC has always emphasized on the efficiency of dust collection equipment.

For increasing dust preventive facilities, Hsinchenshan Mine of the Hualien plant had built 440-meters-long fully-closed belt conveyor in 2015, which could completely prevent dust shed or spread, moreover, the Hualien plant has set up dustproof net outside of the belt conveyor and continued to build 180-meters-long fully-closed belt conveyor in 2016.

At present, ACC's Hsinchu plant has 2 electrostatic precipitators and 35 bag filters, with a total investment cost of NT $174 million. The Hualien plant has 9 electrostatic precipitators and 80 bag filters, with a total investment cost more than NT $950 million.
The good maintenance of above equipment ensures dust collection efficiency which is within the legal limit. Consequently, the quality of air around the plants is higher than national standard. As a result, the Environmental Protection Administration (EPA) especially recognized the two plants as environmental protection demonstration plants.
In particular, the amount of dust including chimney emissions measured by environmental protection agencies at the Hualien plant was less than 25 milligrams/m[3] , which was far better than national standard. The plant was awarded by the Chinese National Federation of Industries for its excellent performance of preventing industrial pollution. In addition, the Hualien plant was listed by the EPA as one of the top 10 factories in pollution prevention and has received the Enterprise Environmental Protection Award for three years in a row.
In 2019, the environment expenditure of the Hualien plant, such as purchasing and maintenance of precipitators, training courses, greening and beautification was NT$ 53,567,000.

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5.4.3 Greening and Beautification for Quarry Restoration

Both Hsinchu and Hualien plants have implemented measures for soil conservation and taken actions to green the environment by planting trees and other vegetation. For many years, the Hualien plant promotes the cultivation of the native species of trees for greening the quarry and the plant.
As of 2019, the green restoring area is 65.1 acres which is 76.5% of the quarry, while exploiting operation area is 22.0 acres. Recently, the quarry of the Hualien plant is visible from nearby high way and railroad. In order to integrate the quarry into the surrounding environment, the Hualien Plant introduced a new forestation method for quarry restoration. Within merely two year, trees could grow up to 4 meters high. The green restoring area will increase 2 acres every year.
In 2019, the Hualien plant devoted NT$ 241,606,000 to the greening and beautification of the quarry.
Due to Hualien Plant’s dedication of environmental protection and engaging in community activities, the Taroko National Park cooperates with the Company to preserve native species of trees for greening and beatification of the National Park and environment guidance.
In 2007, the Hualien Plant was awarded for the excellent performance in the project of “promoting green communities” by the Environmental Protection Administration.
In 2018, the Hualian plant’s Quarry's Green Sustainable Action Plan was awarded the “Asia Responsible Enterprise Awards” by the Enterprise Asia.
In 2019, the Hualian plant’s "Deeply Rooting the Seeds of Sustainable Hope – Asia Cement environment education Project" was awarded the “Asia Responsible Enterprise Awards” by the Enterprise Asia.

5.4.4 Major Environmental Protection Work in the Future

Reinforcing and ensuring the normal operation of environmental facilities.
Practicing in industry waste reduction; avoiding pollution.
Improving the greening rate in factory and quarry areas.
Utilizing wastes as resources to take social responsibilities.
Endlessly enhancing the environmental measures and techniques; expecting to reach the goal of “zero pollution”.

5.4.5 Fulfill Social Responsibilities

The Company volunteered to take care of greenbelts and pavements alone the Dun-Hua South Road and An-He Road over a long period of time to fulfill its social responsibilities and strengthen relations with neighborhood.
Since 2001 on, Hualien plant has annually participated in local festivals such as lily blossom in Buluowan held by the Taroko National Park and donated potted flowers and plants for all visitors.
For our neighbors’ traffic safety, the Hualien plant has regularly sponsored Xincheng Branch of the Hualien County Police Office to renew police stands and street lamps.

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The Company will also sponsor local activities and facilities of the villages and towns nearby the Hsinchu and Hualien plant.
Employees are encouraged to serve as hospital volunteers.
Based on ACC corporate philosophy of “feeding back to society whatever takes from society,” the Company sponsors Far Eastern Medical Foundation, Far Eastern Y.Z. Hsu Science and Technology Memorial Foundation, and Far Eastern Memory Foundation and participates in all kinds of public service activities.

5.5 Labor Relations

The Company complies with every regulation of labor relationship. Due to the excellent labor relations, there were no damages or penalties causing from labor disputes.

According to law, The Company has Industrial Welfare Committee to allot welfare fund for staffs and conduct many welfare-related activities. In factory, we have basketball courts, tennis courts, badminton courts, table tennis courts, and swimming pools, etc., as staff's recreational facilities. Health examination, group insurance, subsidies for employee’s education, trips, and clubs are also included in welfare plans.
Employee Relations

The Company provides Employee Assistance Program (EAP) service from Hsinchu Lifeline Association, EAP Center, which offers professional counsel to all issues employees may meet, such as career development, family issues, and interpersonal relationship. We will also conduct a new personnel care questionnaire to understand the workplace adaptability of new employees and provide necessary assistance based on their feedback. In addition, various types of psychological education and care and propaganda will be posted on the company's electronic bulletin board to promote employees' mental health knowledge.

Each year, the Human Resources Department conducts curriculums based on the functional needs of different departments and levels, combines the company's development strategies, and provides opportunities for supervisors and employees to fully study and train. It not only achieves the goal of training, but also links with the development of employees' careers. The training courses include: new personnel training, core competency training, professional/functional training, leadership training, and so on. In 2019, the special training project “Innovative learning ability” was completed.

At the same time, the various departments of the company can also recommend their colleagues to participate in vocational training courses introduced by related companies, government agencies and social organizations, to improve their professional functions, and to link with social pulsations.

In 2019, the high-potential leadership training program was continuously implemented, covering all middle and high-level supervisors of all subsidiaries of the Asia Cement, with a

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total of 12 hours of training courses. Since 2014, after intensive 225-hour course training, 30 high-level conference internships, and 30 seminars, more than half of the training talents have been promoted. The program also has a training mechanism to enable these potential successors to continue learning to make sure under the increasingly severe environmental challenges of the company, more backbone talents can lead the organization to continue to develop.

Furthermore, Human Resource Department holds reading club, inviting a professional lecturer monthly to guide reading and facilitate discussion, encouraging employees to absorb new concepts and sharing knowledge.

In 2019, totally 680 training courses were held for ACC employees, roughly 8031 participants; the relevant expenditures amounted to NT$ 2.45 million.

The “Employment Rules of Asia Cement Corporation” articulates regulations in connection with appointment, service, assessment, and rewards as well as punishments, promotion, retirement, and compensation, etc. In order to guarantee the rights relating to retirement and compensation, in accordance with the law the Company sets up Supervisory Committee of the Labor Retirement Fund, allocates work’s retirement reserve fund into the special account managed by assigned institutions, regularly convenes the supervisory committee, and audits the allocation and practice of work’s retirement reserve fund. In addition, in compliance with Labor Pension Act, the Company monthly set aside pension fund for the employees who choose to be subject to the pension mechanism.
The Company’s management philosophy “Sincerity, Diligence, Thrift, Prudence and innovation” has been firmly in every employee’s heart. “Sincerity” implies honest and enthusiasm. “Diligence” indicates dedication. “Thrift” signifies frugality and modesty. “Prudence” represents deliberation and accuracy. In short, one important corporate culture of ACC is that every job should be done thoroughly, precisely, and perfectly.
In “Employment Rules of Asia Cement Corporation” mentioned above, the chapter 4 ‘Service’, and chapter 7 ‘Assessment, Reward, Punishment, and Promotion’ clearly illustrate the principles of conduct. In terms of management, besides emphasizing staff self-discipline, the Company also asks every department managers to take responsibilities of educating, advising, and leading their subordinates, which enables employees to fully understand the behavior and ethics criteria.

For better compliance with corporation governance, the Company has also enacted “Codes of Ethical Conduct” and “Principles for Ethical Management”.

Policies of labor safety and health
A. Management in Labor Safety and Health

The Company’s policy of labor safety and health is based on the following vision-“protecting labor safety, improving occupational environment, and building up friendly workplace.” Also, we comply with Labor Safety and Health Act, carry out

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systematical management in occupational health and safety, and implement identification of the hazardous factors, risk evaluation and control in workplace. Besides setting up safety standards and developing safety management system, the safety-related training courses, such as prevention of hidden dangers, emergency response planning, and safety self-management are regularly and irregularly held, to ensure that all employees can obey safety related rules and operate safety equipment and protective outfits well.

In February 2009, the Hualien plant has passed TOSHMS (Taiwan Occupational Safety and Health Management System). The "CNS15506: 2011 Taiwan Occupational Safety and Health Management System" and "OHSAS18001: 2007 Occupational Safety and Health Management System" currently implemented by Hualien Plant were evaluated and approved by the Foundation for Research and Development of Metal Industry Research and Development Center on June 28, 2016. Its effective period is to June 27, 2019. It passed certification on June 28, 2019 and changed to "ISO45001:2018" and "CNS15506:2011". It is expected to be changed to "CNS45001:2018 Z2158" again in June 2020. The Headquarters and Hsinchu Plant also follows the model of Hualien plant for establishing a faultless occupational safety and health management System.

A major occupational disaster occurred in the Company's Hualien Manufacturing Plant in 2017. It was caused by the failure of laborers to comply with SOP operations and non-compliance with hazard warnings. Under conditions without approval and without protective gear, the laborers rushed into the material cabinet and suffocated and died as buried in fallen gypsum material. The Company held a review meeting on July 19, 2017 for effectively improving the management of occupational safety and health, and proposed a strategy for improving the related management and safety to effectively reduce the agglomeration of materials and the frequency of clearing operations. Also, the risk assessment will be re-adopted. The Company will amend the SOP, implement training, and introduce new types of equipment to increase the labor safety.

Due to the major occupational disaster, the Company was designated as the Enhance Enforcement Program (EEP) target by the Occupational Safety and Health Department of the Ministry of Labor to strengthen inspections. The Company will strengthen risk assessment, divide the responsible areas to implement active inspections and autonomous management proposals, and reduce irregularities in workplaces to ensure work safety and health. In March 7, 2019, the Occupational Safety and Health Department of the Ministry of Labor agreed to remove the Company from the special list of Enhance Enforcement Program (EEP) target. The company has learned lessons and will continue to improve to build a corporate safety culture toward zero disasters target.

B. Workplace environment and labor safety protection

To assure employee safety and health, protect the assets of the Company, and make comfortable and safe workplace, based on safety-related rules, we have the following active measures:

a. Following procurement to assure the intrinsic safety of raw materials and equipment:

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Conforming to the safety and health standard is the essential consideration of purchasing raw materials and equipment to assure the intrinsic safety of manufacture procedure, products, and equipment.

b. General safety management, training courses, and related auditing:

We monthly hold safety and health committee and safety-related courses for employees and contractors to make sure that everyone working with ACC fully understands the possible hazardous factors and prevention measures in workplace, and obeys safety-related standards to preclude the occurrence of any disaster. Also, by means of “the walking around management” and frequently patrols, we investigate flaws and also improve them to assure the effective operation in safety management.

c. Workplace environmental monitoring system and usage of protective outfits:

All plants regularly monitor noise, high temperature, and radiation around workplace, so the unusual condition can be immediately detected and eliminated. Also, all employees can be protected from possible dangers by protective outfits designed for different hidden hazardous factors in workplace.

d. Health Care Management for Employees:

All plants set up medical offices with nursing staff and contracted doctors, and prepare emergency medicine, equipment, and supplies. According to related rules, all employees regularly accept health assessment and carry out health care management.

e. Emergency Drills and Exercises

All plants shall regularly exercise emergency response drills by following their emergency response plan. All employees shall be familiar with relevant details, which ensures the losses could be minimized in case of emergency.

ACC has enjoyed harmonious relations between management and employees for years. Employees devoted their time and hard work to the Company. In recent years, the Company's continuous excellent performance of sales and production is a proof of employees' effort. The Company's work and employment regulations are based on the Labor Law and in some cases even exceed the minimum requirements of the law. Besides reasonable payment, ACC gives seasonal bonuses to encourage clinker production, attendance award, and cost and resource-saving measures, as well as year-end bonuses based on the Company's annual performance.

The Company was awarded “2013 Excellence Recognition for its collective agreement with employees” by the Ministry of Labor.

In the most recent year and up to the date of publication of the annual report, losses suffered due to labor disputes: The Hualien Plant was fined NT$20,000 for overtime pay. Counter measures: handled in accordance with labor standards regulations

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5.6 Major Contracts

Type of Contract	Contracting Party	Contracting Party	Contract Duration	Primary Contents	Restrictive Clauses
Bank long-term loan/guarantee	Mizuho Corporate Bank, Taipei Branch		2020/03~2022/03	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	Taiwan Cooperative Bank Ta-An Branch		2020/03~2022/03	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	First Commercial Bank. Tung-Hwa Branch		2020/02~2022/02	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	Hwa Nan Commercial Bank. Tung-Hwa Branch		2020/01~2022/01	Interest paid monthly, principal repaid at maturity	None
Bank long-term secured loan	Far Eastern International Bank Business Dept.		2020/01~2023/01	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	BNP PARIBAS Taipei Branch		2020/01~2022/01	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	Yuanta Commercial Bank		2019/12~2021/12	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	DBS Bank (Taiwan) Ltd		2019/10~2021/10	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	Land Bank of Taiwan Co., Ltd. Tung-Hwa Branch		2019/09~2021/09	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	Chang Hwa Bank Tung-Hwa Branch		2019/08~2021/08	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	SMBC Bank Taipei Branch		2019/07~2021/07	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	Bank of Taiwan Wu-Chang Branch		2019/07~2021/07	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	Bank of China Taipei Branch		2019/07~2021/07	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	E.Sun Commercial Bank		2019/07~2021/07	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	Mega International Commercial Bank Foreign Dept.		2019/06~2021/06	Interest paid monthly, principal repaid at maturity	None
Bank long-term secured loan	Mega International Commercial Bank Foreign Dept.		2019/06~2021/06	Interest paid monthly, principal repaid at maturity	None
Bank long-term unsecured loan	KGI Bank		2018/09~2020/09	Interest paid monthly, principal repaid at maturity	None
Long term raw material supply	BB Co.,	2019/04~2019/12		Contract of Coal Purchase	None
Long term raw material supply	Chung Ling Co.	2019/04~2020/06		Contract of Clay Purchase	None
Long term raw material supply	Young Year (Gypsum)	2019/01~2019/12		Contract of Gypsum Purchase	None
Long term service provider	Anhe Enterprise	2019/01~2019/12		Contract of service	None
Long term construction service provider	Yuantai Corp.	2019/01~2020/06		Contract of construction service	None

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VI Financial Information

6.1Financial Reports & Audit Results in Recent five Years

6.1.1 Consolidated Balance Sheets

UNIT: NT$1,000

		UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000
Year Item		Five-Year Financial Summary
		2015	2016	2017	2018	2019
Current Assets		52,844,285	42,148,568	50,262,702	80,358,506	89,242,066
Property, Plant and Equipment		67,264,573	58,832,486	53,738,838	52,549,341	50,681,281
Intangible Assets		5,304,367	4,866,642	4,552,561	3,694,783	7,000,317
Other Assets		144,663,984	132,623,089	138,510,247	142,585,368	150,354,848
Total Assets		270,077,209	238,470,785	247,064,348	279,187,998	297,278,512
Current Liabilities	Before Apportioned	65,223,927	40,857,530	53,948,167	62,804,294	74,335,619
	After Apportioned	68,921,519	43,882,832	57,981,903	72,216,346	-
Non-current	Liabilities	49,999,090	56,950,034	47,319,817	57,335,358	53,493,855
Total Liabilities	Before Apportioned	115,223,017	97,807,564	101,267,984	120,139,652	127,829,474
	After Apportioned	118,920,609	100,832,866	105,301,720	129,551,704	-
Equity Attributable To Owners Of The Corporation		135,898,873	122,663,077	127,435,565	137,892,226	146,067,358
Share Capital		33,614,472	33,614,472	33,614,472	33,614,472	33,614,472
Capital Surplus		1,155,643	1,167,881	1,168,692	1,362,554	1,456,054
Retained Earnings	Before Apportioned	91,552,336	91,599,413	94,196,274	99,918,986	108,564,355
	After Apportioned	87,854,744	88,574,111	90,162,538	90,506,934	-
Other Equity		9,576,422	(3,718,689)	(1,543,873)	2,996,214	2,432,477
Non-Controlling Interests		18,955,319	18,000,144	18,360,799	21,156,120	23,381,680
Total Equity	Before Apportioned	154,854,192	140,663,221	145,796,364	159,048,346	169,449,038
	After Apportioned	151,156,600	137,637,919	141,762,628	149,636,294	-

113

6.1.2 Consolidated Statements Of Comprehensive Income

UNIT: NT$1,000

	UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000
Year Item	Five-Year Financial Summary
	2015	2016	2017	2018	2019
Operating Revenue	66,287,480	60,946,190	64,899,248	82,741,004	89,347,637
Realized Gross Profit	7,058,747	8,588,274	10,170,478	21,171,461	25,586,317
Profit From Operations	4,039,945	6,233,048	7,436,716	18,153,110	22,063,176
Non-operating Income And Expenses	2,774,213	243,541	1,062,443	2,217,008	6,330,006
Income Before Income Tax	6,814,158	6,476,589	8,499,159	20,370,118	28,393,182
Net Profit For The Period	4,934,483	4,683,297	6,665,541	14,889,197	22,243,953
Other Comprehensive Income,Net	(3,860,529)	(14,688,396)	2,119,539	1,436,173	(617,304)
Total Comprehensive Income For The Period	1,073,954	(10,005,099)	8,785,080	16,325,370	21,626,649
Net Profit Attributable To Owner Of The Company	4,860,241	3,945,769	5,469,007	11,117,094	17,459,673
Net Profit Attributable To Non-ControllingInterests	74,242	737,528	1,196,534	3,772,103	4,784,280
Total Comprehensive Income Attributable To Owner Of The Company	1,343,662	(9,550,011)	7,895,746	12,811,353	17,652,536
Total Comprehensive Income Attributable To Non-ControllingInterests	(269,708)	(455,088)	889,334	3,514,017	3,974,113
Earnings Per Share	1.55	1.26	1.74	3.54	5.56
Earnings Per Share(Note1)	1.55	1.26	1.74	3.54	5.56

Note: Based on weighted average outstanding shares in 2019 after subtracting the shares of the Corporation held by the associates treated as treasury stock.

114

6.1.3 Separate Balance Sheets

UNIT: NT$1,000

		UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000
Year Item		Five-Year Financial Summary
		2015	2016	2017	2018	2019
Current Assets		14,560,998	8,560,664	8,969,876	10,164,679	10,880,961
Property, Plant and Equipment		5,220,819	5,142,099	4,665,393	4,374,050	4,234,288
Intangible Assets		8,639	10,287	8,948	8,344	4,957
Other Assets		169,888,349	157,629,856	166,201,481	178,284,025	188,820,293
Total Assets		189,678,805	171,342,906	179,845,698	192,831,098	203,940,499
Current Liabilitie s	Before Apportioned	23,780,564	8,016,448	15,051,567	17,648,284	16,273,235
	After Apportioned	27,478,156	11,041,750	19,085,303	27,060,336	-
Non-current Liabilities		29,999,368	40,663,381	37,358,566	37,290,588	41,599,906
Total Liabilitie s	Before Apportioned	53,779,932	48,679,829	52,410,133	54,938,872	57,873,141
	After Apportioned	57,477,524	51,705,131	56,443,869	64,350,924	-
Share Capital		33,614,472	33,614,472	33,614,472	33,614,472	33,614,472
Capital Surplus		1,155,643	1,167,881	1,168,692	1,362,554	1,456,054
Retained Earnings	Before Apportioned	91,552,336	91,599,413	94,196,274	99,918,986	108,564,355
	After Apportioned	87,854,744	88,574,111	90,162,538	90,506,934	-
Other Equity		9,576,422	(3,718,689)	(1,543,873)	2,996,214	2,432,477
Total Equity	Before Apportioned	135,898,873	122,663,077	127,435,565	137,892,226	146,067,358
	After Apportioned	132,201,281	119,637,775	123,401,829	128,480,174	-

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6.1.4 Separate Statements Of Comprehensive Income

UNIT:

NT$1,000

	UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000
Year Item	Five-Year Financial Summary
	2015	2016	2017	2018	2019
Operating Revenue	12,012,770	9,917,334	8,186,867	8,732,236	8,985,917
Realized Gross Profit	1,547,808	1,288,995	670,927	256,534	469,483
Profit From Operations	977,733	758,915	148,282	(393,973)	(212,675)
Non-operating Income And Expenses	5,330,300	3,792,066	5,253,097	12,588,705	18,368,775
Income Before Income Tax	6,308,033	4,550,981	5,401,379	12,194,732	18,156,100
Net Profit For The Year	4,860,241	3,945,769	5,469,007	11,117,094	17,459,673
Other Comprehensive Income , Net	(3,516,579)	(13,495,780)	2,426,739	1,694,259	192,863
Total Comprehensive Income For The Year	1,343,662	(9,550,011)	7,895,746	12,811,353	17,652,536
Earnings Per Share	1.55	1.26	1.74	3.54	5.56
Earnings Per Share(Note1)	1.55	1.26	1.74	3.54	5.56

Note: Based on weighted average outstanding shares in 2019 after subtracting the shares of the Corporation held by the associates treated as treasury stock.

6.1.5Auditors’ Opinions from 2015 to 2019

Year	CPA's Name	Audit Opinion
2015	Li Wen Kuo、Yu Wei Fan	Unqualified Opinion
2016	Li Wen Kuo、Yu Wei Fan	Unqualified Opinion
2017	Li Wen Kuo、Yu Wei Fan	Unqualified Opinion
2018	Li Wen Kuo、Yu Wei Fan	Unqualified Opinion with Emphasis of Matter Paragraphs and Other Matter Paragraphs
2019	Xin Wei Tai、Yu Wei Fan	Unqualified Opinion with Other Matter Paragraphs

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6.2 Financial Analysis 6.2.1 Consolidated Financial Statements

Item	Year	Financial Analysis (2015~2019)	Financial Analysis (2015~2019)	Financial Analysis (2015~2019)	Financial Analysis (2015~2019)	Financial Analysis (2015~2019)
		2015	2016	2017	2018	2019
Capital Structure Analysis	Debts Ratio (%)	42.66	41.01	40.99	43.03	43.00
	Long-term Fund to Property, Plant and Equipment (%)	304.55	335.89	359.36	411.77	439.89
Liquidity Analysis	Current Ratio (%)	81.02	103.16	93.17	127.95	120.05
	Quick Ratio (%)	69.80	86.22	80.98	112.34	109.57
	Times Interest Earned (Times)	5.14	4.95	5.80	13.17	16.60
Operating Performance Analysis	Average Collection Turnover (Times)	3.55	3.85	3.96	3.99	3.95
	Days Sales Outstanding	103	95	92	91	92
	Average Inventory Turnover (Times)	7.08	7.35	8.11	7.52	7.25
	Average Payment Turnover (Times)	6.42	6.64	7.30	7.73	5.85
	Average Inventory Turnover Days	52	50	45	49	50
	Property, Plant and Equipment Turnover (Times)	0.96	0.97	1.15	1.56	1.73
	Total Assets Turnover (Times)	0.24	0.24	0.27	0.31	0.31
Profitability Analysis	Return on Total Assets (%)	2.28	2.38	3.35	6.17	8.22
	Return on Shareholders’ Equity (%)	3.12	3.17	4.65	9.77	13.54
	Pre-tax Income to Paid-in Capital Ratio (%)	20.27	19.27	25.28	60.60	84.47
	Net Margin (%)	7.44	7.68	10.27	17.99	24.90
	Basic Earnings Per Share (NT$) (Based on outstanding shares in 2019)	1.55	1.26	1.74	3.54	5.56
Cash Flow	Cash Flow Ratio (%)	20.95	31.37	15.09	14.75	50.14
	Cash Flow Adequacy Ratio (%)	112.25	126.91	133.25	127.58	180.16
	Cash Reinvestment Ratio (%)	2.97	4.43	2.49	2.24	11.73
Leverage	Operating Leverage	2.42	1.87	1.70	1.27	1.28
	Financial Leverage	1.69	1.36	1.31	1.10	1.09
Analysis of deviation of 2019 vs. 2018 over 20%: The decrease in Average Payment Turnover was mainly due to the increase of accounts payable and accrued expenses at year-end of 2019. The increase in Times Interest Earned, Return on Total Assets, Return on Shareholders’ Equity, Pre-tax Income to Paid-in Capital Ratio, Net Margin and Basic Earnings Per Share were mainly due to the increase of net income in 2019. The increase in Cash Flow Ratio, Cash Flow Adequacy Ratio and Cash Reinvestment Ratio were mainly due to an increase in cashprovided byoperatingactivities in 2019.

117

6.2.2 Separate Financial Statements

Item	Year	Financial Analysis (2015~2019)	Financial Analysis (2015~2019)	Financial Analysis (2015~2019)	Financial Analysis (2015~2019)	Financial Analysis (2015~2019)
		2015	2016	2017	2018	2019
Capital Structure Analysis	Debts Ratio (%)	28.35	28.41	29.14	28.49	28.38
	Long-term Fund to Property, Plant and Equipment (%)	3,177.63	3,176.26	3,532.27	4,005.05	4,432.09
Liquidity Analysis	Current Ratio (%)	61.23	106.79	59.59	57.60	66.86
	Quick Ratio (%)	54.65	90.84	50.93	48.17	57.37
	Times Interest Earned (Times)	13.12	13.34	17.29	37.73	50.16
Operating Performance Analysis	Average Collection Turnover (Times)	11.34	11.10	9.37	8.92	8.43
	Days Sales Outstanding	32	33	39	41	43
	Average Inventory Turnover (Times)	6.68	6.07	5.83	5.72	5.30
	Average Payment Turnover (Times)	5.97	5.30	4.92	5.44	5.18
	Average Inventory Turnover Days	55	60	63	64	69
	Property, Plant and Equipment Turnover (Times)	2.39	1.91	1.67	1.93	2.09
	Total Assets Turnover (Times)	0.06	0.05	0.05	0.05	0.05
Profitability Analysis	Return on Total Assets (%)	2.80	2.36	3.27	6.11	8.95
	Return on Shareholders’ Equity (%)	3.50	3.05	4.37	8.38	12.30
	Pre-tax Income to Paid-in Capital Ratio (%)	18.77	13.54	16.07	36.28	54.01
	Net Margin (%)	40.46	39.79	66.8	127.31	194.30
	Basic Earnings Per Share (NT$) (Based on outstanding shares in 2019)	1.55	1.26	1.74	3.54	5.56
Cash Flow	Cash Flow Ratio (%)	25.81	54.45	21.99	18.45	47.97
	Cash Flow Adequacy Ratio (%)	87.49	87.14	92.22	88.37	83.03
	Cash Reinvestment Ratio (%)	(0.84)	0.46	0.19	(0.49)	(0.94)
Leverage	Operating Leverage	1.50	1.85	5.29	Note1	Note1
	Financial Leverage	2.14	1.95	(0.81)	Note2	Note2
Analysis of deviation of 2019 vs. 2018 over 20%: The increase in Times Interest Earned, Return on Total Assets, Return on Shareholders’ Equity, Pre-tax Income to Paid-in Capital Ratio, Net Margin and Basic Earnings Per Share were mainly due to the increase of net income in 2019. The increase of Cash Flow Ratio was due to the increase of cash provided by operating activities in 2019. The decrease in Cash Reinvestment Ratio was mainlydue to the increase of cash dividendspaid in 2019.

Note1 ： The ratio was equal or less than zero. Note2 ： The ratio was not calculated due to operating loss.

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*Glossary

1. Capital Structure Analysis

(1) Debt Ratio = Total Liabilities / Total Assets
(2) Long-term Fund to Property, Plant and Equipment Ratio = (Shareholders’ Equity + Noncurrent Liabilities) / Net Property, Plant and Equipment

2. Liquidity Analysis

(1) Current Ratio = Current Assets / Current Liabilities
(2) Quick Ratio = (Current Assets - Inventories - Prepaid Expenses) / Current Liabilities
(3) Times Interest Earned = Earnings before Interest and Taxes / Interest Expenses

3. Operating Performance Analysis

(1) Average Collection Turnover = Net Sales / Average Trade Receivables
(2) Days Sales Outstanding = 365 / Average Collection Turnover
(3) Average Inventory Turnover = Cost of Sales / Average Inventory
(4) Average Payment Turnover = Cost of Sales / Average Trade Payables
(5) Average Inventory Turnover Days = 365 / Average Inventory Turnover
(6) Property, Plant and Equipment Turnover = Net Sales / Average Net Property, Plant and Equipment
(7) Total Assets Turnover = Net Sales / Average Total Assets

4. Profitability Analysis

(1) Return on Total Assets = (Net Income + Interest Expenses * (1 - Effective Tax Rate)) / Average Total Assets
(2) Return on Shareholders’ Equity = Net Income / Average Total Equity
(3) Pre-tax Income to Paid-in Capital Ratio = Income before Tax / Paid-in Capital
(4) Net Margin = Net Income / Net Sales
(5) Basic Earnings Per Share = (Net income attributable to Shareholders of the Parent - Preferred Stock Dividend) / Weighted Average Number of Shares Outstanding

5. Cash Flow

(1) Cash Flow Ratio = Net Cash Provided by Operating Activities / Current Liabilities
(2) Cash Flow Adequacy Ratio = Five-year Sum of Cash from Operations / Five-year Sum of Capital Expenditures, Inventory Additions, and Cash Dividend
(3) Cash Reinvestment Ratio = (Cash Provided by Operating Activities - Cash Dividends) / (Gross Property, Plant and Equipment + Long-term Investments + Other Noncurrent Assets + Working Capital)

6. Leverage

(1) Operating Leverage = (Net Sales - Variable Cost) / Income from Operations
(2) Financial Leverage = Income from Operations / (Income from Operations - Interest Expenses)

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6.3 Audit Committee’s Review Report on the 2019 Financial Statements

To: The 2020 Regular Shareholders’ Meeting

The Board of Directors has prepared the Company’s 2019 Business Report, the Proposal for Profit Distribution, and the Financial Statements certified by CPA Mr. Xin Wei Tai and Mr. Yu Wei Fan of the Deloitte & Touche. The Business Report, Financial Statements, and the Proposal for Profit Distribution have been reviewed and determined to be correct and accurate by the Audit Committee members of Asia Cement Corporation. According to Article 14-4 of the Securities and Exchange Act and Article 219 of the Company Act, we hereby submit this report.

Chairman of the Audit Committee: Ta-Chou Huang

May 11, 2020

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6.4 Financial Statements and Independent Auditors’ Report

Please refer to Attachment for the Notes to Financial Statements.

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders Asia Cement Corporation

Opinion

We have audited the accompanying consolidated financial statements of Asia Cement Corporation and its subsidiaries (collectively referred to as the “Group”), which comprise the consolidated balance sheets as of December 31, 2019 and 2018, and the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the consolidated financial statements, including a summary of significant accounting policies (collectively referred to as the “consolidated financial statements”).

In our opinion, based on our audits and the reports of other auditors (refer to Other Matter section), the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2019 and 2018, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with The Norm of Professional Ethics for Certified Public Accountant of the Republic of China, 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 consolidated financial statements for the year ended December 31, 2019. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

121

The key audit matters identified in the Group’s consolidated financial statements for the year ended December 31, 2019 are stated as follows:

Estimated Impairment of Trade Receivables

The estimated provision for impairment of trade receivables is based on the assumptions of defaults and expected loss rates. The assumptions and selection of inputs for impairment calculation are based on the Group’s historical experience, existing market conditions as well as forward looking estimates. When the actual future cash flows are less than expected, a material impairment loss may arise, refer to Notes 5 and 13 to the consolidated financial statements. Because key assumptions and inputs used for measuring expected credit losses on trade receivables involve significant judgments and uncertainties, we considered the estimated impairment of trade receivables as one of the key audit matters.

The corresponding audit procedures that we performed for the estimated impairment of trade receivables are as follows:

We obtained an understanding of the internal control procedures with respect to management’s allowance for impairment loss of trade receivables.
We evaluated the reasonableness of allowance for impairment loss by testing the aging of trade receivables and by quantifying the potential risk of trade receivables that were overdue at the balance sheet date.
We tested the recoverability of the trade receivables by vouching cash receipts after the balance sheet date.
For the estimated impairment of accounts receivable, we evaluated the adequacy of management’s provision for impairment based on customers’ past default experience, current financial position, any collateral pledged, existing market conditions as well as forward looking estimates.

Fair Value Measurement of Investment Properties

The Group’s investment properties are subsequently measured using the fair value model and valued by an independent qualified professional appraiser, a member of the ROC certified real estate appraisers, refer to Notes 5 and 18 to the consolidated financial statements. Because the valuation of investment properties involves significant judgments and uncertainties, we considered the fair value measurement of investment properties as one of the key audit matters.

The corresponding audit procedures that we performed for the fair value measurement of investment properties are as follows:

We assessed the professional competence and independence of the appraiser engaged by management and we obtained an understanding of the appraiser’s scope of work and process of engagement to confirm that no circumstances affect the appraiser’s independence and limit the scope of his work.
We obtained an understanding of and assessed the reasonableness of management’s assumptions and methods used in the valuation.

122

We sample-tested items from management’s supporting documents, which include the effective gross income, expenses, and property rights of land and buildings to verify the valuation process used by management and recalculated the fair value of investment properties to assess the reasonableness of management’s calculation.

Other Matter

The financial statements of China Shanshui Cement Group Limited (CSCGL), an associate accounted for using equity method, were audited by other auditors as of December 31, 2019 and 2018. Our opinion, insofar as it relates to the amounts included in the accompanying financial statements for CSCGL, is based solely on the reports of other auditors. As of December 31, 2019 and 2018, the aggregate carrying value of the equity-method investments in CSCGL was NT$12,024,837 thousand and NT$10,217,370 thousand, respectively, both representing 4% of the consolidated total assets. For the years ended December 31, 2019 and 2018, the share of profit or loss of CSCGL was NT$2,211,559 thousand and NT$376,557 thousand, respectively, representing 8% and 2%, respectively, of the consolidated profit before income tax.

We have also audited the parent company only financial statements of Asia Cement Corporation as of and for the years ended December 31, 2019 and 2018 on which we have issued an unmodified opinion with other matter paragraph.

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

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and IFRS, IAS, IFRIC, and SIC endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group’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 Group or to cease operations, or has no realistic alternative but to do so.

Those charged with governance, including the audit committee, are responsible for overseeing the Group’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, 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 the auditing standards generally accepted in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

123

As part of an audit in accordance with the auditing standards generally accepted in the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated 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, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
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 Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated 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 Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision, and performance of the group audit. We remain solely responsible for our audit opinion.

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 to 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 consolidated financial statements for the year ended December 31, 2019 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.

124

The engagement partners on the audit resulting in this independent auditors’ report are Tai, Xin Wei and Fan, Yu Wei.

Deloitte & Touche Taipei, Taiwan Republic of China March 25, 2020

Notice to Readers

The accompanying consolidated financial statements are intended only to present the consolidated financial position, financial performance and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such consolidated financial statements are those generally applied in the Republic of China.

For the convenience of readers, the independent auditors’ report and the accompanying consolidated financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language independent auditors’ report and consolidated financial statements shall prevail.

125

ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 6 and 37) Financial assets at fair value through profit or loss - current (Notes 7 and 36) Financial assets at fair value through other comprehensive income - current (Notes 8 and 38) Financial assets at amortized cost - current (Notes 6, 9, 36 and 38) Contract assets - current (Notes 31 and 37) Notes receivable Third parties Trade receivables Third parties (Notes 10 and 11) Related parties (Notes 10 and 37) Other receivables (Notes 12 and 37) Current tax assets (Note 33) Inventories (Note 13) Prepayments (Notes 21 and 37) Other current assets (Note 22) Total current assets NON-CURRENT ASSETS Investments accounted for using equity method (Notes 15, 37 and 38) Financial assets at fair value through other comprehensive income - non-current (Notes 8 and 38) Financial assets at amortized cost - non-current (Notes 6, 9, 37 and 38) Property, plant and equipment (Notes 16 and 38) Right-of-use assets (Notes 17 and 37) Investment properties (Notes 18 and 38) Intangible assets (Notes 19 and 20) Deferred tax assets (Note 33) Lease receivables - non-current (Note 11) Finance lease receivables - non-current (Note 11) Long-term prepayments for leases (Note 21) Other non-current assets (Notes 22 ,29 and 37) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Notes 23 and 37) Short-term bills payable (Note 24) Financial liabilities at fair value through profit or loss - current (Note 7) Contract liabilities - current (Notes 31 and 37) Accounts payable and accrued expenses Third parties (Note 20) Related parties (Note 37) Dividends and bonuses payable Other payables - others (Note 25) Current tax liabilities (Note 33) Provisions - current (Note 28) Lease liabilities - current (Note 17) Deferred revenue - current (Note 27) Current portion of long-term liabilities (Notes 26 and 37) Total current liabilities NON-CURRENT LIABILITIES Bonds payable (Note 26) Long-term borrowings (Notes 26 and 37) Provisions - non-current (Notes 22, 28 and 39) Lease liabilities - non-current (Note 17) Deferred tax liabilities (Note 33) Net defined benefit liabilities - non-current (Note 29) Deferred revenue - non-current (Note 27) Other non-current liabilities Total non-current liabilities Total liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE CORPORATION (Note 30) Share capital Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Total retained earnings Other equity Total equity attributable to owners of the Corporation NON-CONTROLLING INTERESTS (Note 30) Total equity TOTAL		2019 Amount % $ 24,735,495 8 4,728,223 2 3,978,366 1 23,016,985 8 68,412 - 11,159,687 4 10,159,263 3 803,340 - 481,800 - 6,785 - 7,789,794 3 1,812,789 1 501,127 - 89,242,066 30 84,412,240 28 11,692,138 4 36,064 - 50,681,281 17 5,080,287 2 36,176,439 12 7,000,317 2 474,929 - - - 8,170,867 3 - - 4,311,884 2 208,036,446 70 $ 297,278,512 100 $ 23,811,603 8 18,932,294 6 112,070 - 987,496 - 13,266,966 5 256,803 - 230,151 - 312,069 - 2,957,672 1 50,661 - 190,607 - 75,912 - 13,151,315 5 74,335,619 25 19,280,807 7 20,820,990 7 715,432 - 1,264,765 1 9,991,422 3 164,208 - 847,893 - 408,338 - 53,493,855 18 127,829,474 43 33,614,472 11 1,456,054 - 16,727,089 6 64,463,426 22 27,373,840 9 108,564,355 37 2,432,477 1 146,067,358 49 23,381,680 8 169,449,038 57 $ 297,278,512 100		2018
				Amount % $ 14,929,411 5 9,046,583 3 3,800,923 2 14,322,874 5 147,528 - 12,928,203 5 9,251,854 3 976,266 - 2,964,751 1 15,901 - 9,804,276 4 1,684,612 1 485,324 - 80,358,506 29 78,846,276 28 9,784,743 4 14,642 - 52,549,341 19 - - 35,965,203 13 3,694,783 1 436,238 - 8,894,355 3 - - 3,779,353 1 4,864,558 2 198,829,492 71 $ 279,187,998 100 $ 24,805,239 9 18,564,469 7 268,218 - 731,015 - 8,028,077 3 250,857 - 231,722 - 334,305 - 2,181,268 1 48,200 - - - 75,912 - 7,285,012 2 62,804,294 22 12,192,567 5 33,593,896 12 679,377 - - - 9,365,429 4 185,107 - 923,805 - 395,177 - 57,335,358 21 120,139,652 43 33,614,472 12 1,362,554 - 15,615,380 6 63,945,145 23 20,358,461 7 99,918,986 36 2,996,214 1 137,892,226 49 21,156,120 8 159,048,346 57 $ 279,187,998 100

The accompanying notes are an integral part of the consolidated financial statements. (With Deloitte & Touche auditors’ report dated March 25, 2020)

126

ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OPERATING REVENUE (Notes 31 and 37) OPERATING COSTS (Notes 13, 31 and 37) GROSS PROFIT UNREALIZED GAIN ON TRANSACTIONS WITH ASSOCIATES REALIZED GAIN ON TRANSACTIONS WITH ASSOCIATES REALIZED GROSS PROFIT OPERATING EXPENSES Administrative expenses (Notes 32 and 37) Expected credit loss (Note 10) Total operating expenses OPERATING INCOME NON-OPERATING INCOME AND EXPENSES Other income (Note 32) Other gains and losses (Note 32) Finance costs (Note 32) Share of profit of associates and joint ventures Total non-operating income and expenses PROFIT BEFORE INCOME TAX INCOME TAX EXPENSE (Note 33) NET INCOME FOR THE YEAR		2019 Amount % $ 89,347,637 100 63,746,928 71 25,600,709 29 14,392 - - - 25,586,317 29 3,332,110 4 191,031 - 3,523,141 4 22,063,176 25 1,998,600 2 661,654 1 (1,820,623) (2) 5,490,375 6 6,330,006 7 28,393,182 32 6,149,229 7 22,243,953 25		2018
				Amount % $ 82,741,004 100 61,584,690 74 21,156,314 26 - - 15,147 - 21,171,461 26 2,875,798 4 142,553 - 3,018,351 4 18,153,110 22 1,479,803 2 (1,733,766) (2) (1,673,185) (2) 4,144,156 5 2,217,008 3 20,370,118 25 5,480,921 7 14,889,197 18 (Continued)

127

ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OTHER COMPREHENSIVE INCOME, NET Items that will not be reclassified subsequently to profit or loss: Unrealized gain on investments in equity instruments at fair value through other comprehensive income Remeasurement of defined benefit plans Share of other comprehensive income of associates and joint ventures Items that may be reclassified subsequently to profit or loss: Exchange differences on translating the financial statements of foreign operations Cash flow hedges Share of other comprehensive (loss) income of associates and joint ventures Other comprehensive (loss) income for the year, net of income tax TOTAL COMPREHENSIVE INCOME FOR THE YEAR NET PROFIT ATTRIBUTABLE TO: Owners of the Corporation Non-controlling interests TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO: Owners of the Corporation Non-controlling interests EARNINGS PER SHARE (Note 34) Basic Diluted		2019 Amount % $ 1,193,292 1 486,711 1 1,778,252 2 3,458,255 4 (2,635,629) (3) - - (1,439,930) (2) (4,075,559) (5) (617,304) (1) $ 21,626,649 24 $ 17,459,673 20 4,784,280 5 $ 22,243,953 25 $ 17,652,536 20 3,974,113 4 $ 21,626,649 24 $ 5.56 $ 5.25		2018
				Amount % $ 707,605 1 265,511 - 723,519 1 1,696,635 2 (894,761) (1) (2,434) - 636,733 1 (260,462) - 1,436,173 2 $ 16,325,370 20 $ 11,117,094 13 3,772,103 5 $ 14,889,197 18 $ 12,811,353 16 3,514,017 4 $ 16,325,370 20 $ 3.54 $ 3.49

The accompanying notes are an integral part of the consolidated financial statements.

(With Deloitte & Touche auditors’ report dated March 25, 2020)

(Concluded)

128

ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

		Equity Attributable to O	rs of the Corporation
Share Capital	Issued Amount Capital Surplus $ 33,614,472 $ 1,168,692 - - - - - - - 185,411 - 8,451 - - - - - - - - - - 33,614,472 1,362,554 - - 33,614,472 1,362,554 - - - - - - - 93,500 - - - - - - - - - - $ 33,614,472 $ 1,456,054	Retained Earnings Unappropriated Legal Reserve Special Reserve Earnings $ 15,068,480 $ 63,001,957 $ 17,839,296 546,900 - (546,900 ) - 943,188 (943,188 ) - - (4,033,736 ) - - - - - - - - 11,117,094 - - 351,764 - - - - - (3,408,697 ) - - (17,172) 15,615,380 63,945,145 20,358,461 - - (143,100) 15,615,380 63,945,145 20,215,361 1,111,709 - (1,111,709 ) - 518,281 (518,281 ) - - (9,412,052 ) - - - - - 17,459,673 - - 676,889 - - - - - 79,711 - - (15,752) $ 16,727,089 $ 64,463,426 $ 27,373,840		Other Equity		Total Other Equity $ (1,754,978 ) - - - - - - 1,342,495 - 3,408,697 - 2,996,214 - 2,996,214 - - - - - (484,026 ) - (79,711 ) - $ 2,432,477
			Exchange Differences on Unrealized Gain (Loss) on Translating the Financial Financial Assets at Fair Value Statements of Through Other Foreign Comprehensive Operations Income $ (2,638,153 ) $ 516,962 - - - - - - - - - - - - (3,211 ) 1,343,257 - - - 3,408,697 - - (2,641,364 ) 5,268,916 - - (2,641,364 ) 5,268,916 - - - - - - - - - - (3,271,837 ) 2,719,118 - - - (79,711 ) - - $ (5,913,201) $ 7,908,323	Gains on Property Revaluation $ 307,728 - - - - - - - - - - 307,728 - 307,728 - - - - - 77,486 - - - $ 385,214	Cash Flow Hedges $ 58,485 - - - - - - 2,449 - - - 60,934 - 60,934 - - - - - (8,793 ) - - - $ 52,141

Shares 3,361,447 - - - - - - - - - - 3,361,447 - 3,361,447 - - - - - - - - - 3,361,447

The accompanying notes are an integral part of the consolidated financial statements.

(With Deloitte & Touche auditors’ report dated March 25, 2020)

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ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM OPERATING ACTIVITIES
Income before income tax

Adjustments for:
Share of loss of associates and joint ventures
Depreciation expenses
Finance costs
Amortization expenses
Net (gain) loss on fair value changes of financial assets and
liabilities designated as at fair value through profit or loss
Interest income
Dividend income
Gain on disposal of financial assets
Unrealized gain on foreign exchange
Gain on changes in fair value of investment properties
Expected credit loss recognized on trade receivables
(Reversal of) write-downs of inventories
Loss on disposal of property, plant and equipment
Loss on disposal of investments accounted for using equity method
Impairment loss recognized on investments accounted for using
equity method
Impairment loss recognized on goodwill
Impairment loss on property, plant and equipment
Gain on disposal of subsidiaries
Effect of changes in exchange rate of bonds payable
Other items
Changes in operating assets and liabilities
Financial assets mandatorily classified as at fair value through
profit or loss
Contract assets
Notes receivable
Trade receivables
Other receivables
Inventories
Prepayments
Other current assets
Contract liabilities
Accounts payable and accrued expenses
Provisions
Net defined benefit liabilities
Deferred revenue

Cash generated from operations
Interests received
Dividends received

2019
2018
$ 28,393,182 $ 20,370,118
(5,490,375)
(4,144,156)
4,827,418
4,649,561
1,820,623
1,673,185
1,292,725
269,631
(1,129,040)
256,294
(1,126,001)
(370,571)
(761,309)
(770,314)
(365,192)
(251,859)
(295,492)
(15,575)
(197,647)
(98,015)
191,031
142,553
(18,619)
315,353
44,225
33,455

5,761
-
-
200,245
-
630,631
-
51,888
-
(40,440)
-
300
-
(755)
5,660,259
(3,051,110)
79,116
(44,533)
1,351,524
(4,805,502)
273,510
525,258
1,769,088
(487,332)
1,857,463
(3,566,055)
(408,758)
(31,307)
(34,246)
(74,718)
256,481
(20,934)
697,124
806,044
35,916
176,021
(5,682)
(12,254)

(75,912)

(68,085)
38,647,173
12,247,022
1,161,528
254,393
4,062,869
3,172,662
(Continued)

130

ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

Interests paid

Income tax paid

Net cash generated from operating activities

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of financial assets at amortized cost
Payments for property, plant and equipment
Acquisition of associates
Decrease (increase) in refundable deposits
Purchase of financial assets at fair value through other comprehensive
income
Increase in long-term prepayments for investment
Net cash inflow on disposal of associates
Payments for intangible assets
Proceeds from disposal of property, plant and equipment
Payments for investment properties
Decrease in other non-current assets
Net cash inflow on disposal of subsidiaries

Net cash used in investing activities

CASH FLOWS FROM FINANCING ACTIVITIES
Repayments of long-term borrowings

Proceeds from long-term borrowings
Proceeds from issuance of bonds
Dividends paid
Repayments of bonds
Dividends paid to non-controlling interests
(Decrease) increase in short-term borrowings
Increase in short-term bills payable
Repayment of the principal portion of lease liabilities
Increase (decrease) in other non-current liabilities
(Decrease) increase in guarantee deposits received

Net cash (used in) generated from financing activities

EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE
OF CASH AND CASH EQUIVALENTS HELD IN FOREIGN
CURRENCIES

2019
2018
$ (1,803,500) $ (1,658,691)

(4,796,169)

(3,304,318)

37,271,901

10,711,068
(8,715,533)
(9,537,968)
(3,754,851)
(4,274,600)
(3,326,114)
(123,120)
596,780
(9,678)
(275,281)
(556,016)
(11,224)
(83,721)
63,008
-
(58,941)
(13,037)
37,708
90,395
(27,224)
(1,269)
5,300
1,559

-

48,391
(15,466,372)
(14,459,064)
(92,064,122) (30,396,615)
86,653,202
34,819,996
10,000,000
6,574,843
(9,412,164)
(4,033,715)
(4,000,000)
(4,089,430)
(1,748,520)
(723,504)
(704,248)
6,445,333
369,075
2,439,125
(267,792)
-
21,680
(59,096)

(10,073)

14,691
(11,162,962)

10,991,628

(836,483)

(53,713)
(Continued)

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ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

(In Thousands of New Taiwan Dollars)

2019 NET INCREASE IN CASH AND CASH EQUIVALENTS $ 9,806,084 CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR 14,929,411 CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR $ 24,735,495 The accompanying notes are an integral part of the consolidated financial statements. (With Deloitte & Touche auditors’ report dated March 25, 2020)	2018 $ 7,189,919 7,739,492 $ 14,929,411 (Concluded)

132

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders Asia Cement Corporation

Opinion

We have audited the accompanying financial statements of Asia Cement Corporation (the “Corporation”), which comprise the balance sheets as of December 31, 2019 and 2018, and the statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the financial statements, including a summary of significant accounting policies (collectively referred to as the “financial statements”).

In our opinion, based on our audits and the reports of other auditors (refer to Other Matter section), the accompanying financial statements present fairly, in all material respects, the financial position of the Corporation as of December 31, 2019 and 2018, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Corporation in accordance with The Norm of Professional Ethics for Certified Public Accountant of the Republic of China, 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 financial statements for the year ended December 31, 2019. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

The key audit matters identified in the Corporation’s financial statements for the year ended December 31, 2019 are stated as follows:

Estimated Impairment of Trade Receivables of Subsidiaries

The estimated provision for impairment of trade receivables is based on the assumptions of defaults and expected loss rates. The assumptions and selection of inputs for impairment calculation are based on the historical experience, existing market conditions as well as forward looking estimates of the Corporation’s subsidiaries. When the actual future cash flows are less than expected, a material impairment loss may arise. Because key assumptions and inputs used for measuring expected credit losses on trade receivables involve significant judgments and uncertainties, we considered the estimated impairment of trade receivables as one of the key audit matters.

The corresponding audit procedures that we performed for the estimated impairment of trade receivables of the subsidiaries are as follows:

We obtained an understanding of the internal control procedures with respect to management’s allowance for impairment loss of trade receivables.
We evaluated the reasonableness of allowance for impairment loss by testing the aging of trade receivables and by quantifying the potential risk of trade receivables that were overdue at the balance sheet date.

133

We tested the recoverability of the trade receivables by vouching cash receipts after the balance sheet date.
For the estimated impairment of accounts receivable, we evaluated the adequacy of management’s provision for impairment based on customers’ past default experience, current financial position, any collateral pledged, existing market conditions as well as forward looking estimates.

Fair Value Measurement of Investment Properties

The Corporation’s and its subsidiaries’ investment properties are subsequently measured using the fair value model and valued by an independent qualified professional appraiser, a member of the ROC certified real estate appraisers, refer to Notes 5 and 15 to the financial statements. Because the valuation of investment properties involves significant judgments and uncertainties, we considered the fair value measurement of investment properties as one of the key audit matters.

The corresponding audit procedures that we performed for the fair value measurement of investment properties are as follows:

We assessed the professional competence and independence of the appraiser engaged by management and we obtained an understanding of the appraiser’s scope of work and process of engagement to confirm that no circumstances affect the appraiser’s independence and limit the scope of his work.
We obtained an understanding of and assessed the reasonableness of management’s assumptions and methods used in the valuation.
We sample-tested items from management’s supporting documents, which include the effective gross income, expenses, and property rights of land and buildings to verify the valuation process used by management and recalculated the fair value of investment properties to assess the reasonableness of management’s calculation.

Other Matter

The financial statements of China Shanshui Cement Group Limited (CSCGL), an associate accounted for using equity method, were audited by other auditors as of December 31, 2019 and 2018. Our opinion, insofar as it relates to the amounts included in the accompanying financial statements for CSCGL, is based solely on the reports of other auditors. As of December 31, 2019 and 2018, the aggregate carrying value of the equity-method investments in CSCGL was NT$12,022,105 thousand and NT$10,215,045 thousand, respectively, representing 6% and 5%, respectively, of the total assets. For the years ended December 31, 2019 and 2018, the share of profit or loss of CSCGL was NT$2,211,060 thousand and NT$376,472 thousand, respectively, representing 12% and 3%, respectively, of the profit before income tax

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

Management is responsible for the preparation and fair presentation of the financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Corporation’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 Corporation or to cease operations, or has no realistic alternative but to do so.

Those charged with governance, including the audit committee, are responsible for overseeing the Corporation’s financial reporting process.

134

Auditors’ Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, 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 the auditing standards generally accepted in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Identify and assess the risks of material misstatement of the 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, but not for the purpose of expressing an opinion on the effectiveness of the Corporation’s internal control.
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 Corporation’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the 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 Corporation to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of entities or business activities within the Corporation to express an opinion on the financial statements. We are responsible for the direction, supervision, and performance of the company audit. We remain solely responsible for our audit opinion.

135

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 partners on the audit resulting in this independent auditors’ report are Tai, Xin Wei and Fan, Yu Wei.

Deloitte & Touche Taipei, Taiwan Republic of China March 25, 2020

Notice to Readers

The accompanying financial statements are intended only to present the financial position, financial performance and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such financial statements are those generally applied in the Republic of China.

For the convenience of readers, the independent auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language independent auditors’ report and financial statements shall prevail.

136

ASIA CEMENT CORPORATION

BALANCE SHEETS DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 6 and 30) Financial assets at fair value through profit or loss - current (Note 7) Financial assets at fair value through other comprehensive income - current (Notes 8 and 31) Financial assets at amortized cost (Notes 6, 11 and 30) Notes receivable Third parties Trade receivables Third parties (Note 10) Related parties (Notes 10 and 30) Other receivables (Note 30) Current tax assets (Note 26) Inventories (Note 11) Prepayments (Note 17) Other current assets Total current assets NON-CURRENT ASSETS Investments accounted for using equity method (Notes 12 and 31) Financial assets at fair value through other comprehensive income - non-current (Note 8) Property, plant and equipment (Notes 13 and 31) Right-of-use assets (Note 14) Investment properties (Notes 15, 30 and 31) Intangible assets (Note 16) Deferred tax assets (Note 26) Long-term prepayments for leases (Note 17) Other non-current assets (Notes 18, 22 and 30) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term bills payable (Note 19) Financial liabilities at fair value through profit or loss - current (Note 7) Contract liabilities - current (Note 24) Accounts payable and accrued expenses Third parties Related parties (Note 30) Dividends and bonuses payable Current tax liabilities (Note 26) Lease liabilities - current (Note 14) Deferred revenue - current (Note 21) Current portion of long-term liabilities (Note 20) Total current liabilities NON-CURRENT LIABILITIES Bonds payable (Note 20) Long-term borrowings (Note 20) Provisions - non-current (Note 23) Deferred tax liabilities (Note 26) Lease liabilities - non-current (Note 14) Deferred revenue - non-current (Note 21) Other non-current liabilities Total non-current liabilities Total liabilities EQUITY (Notes 23) Ordinary shares Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Total retained earnings Other equity Total equity TOTAL		2019 Amount % $ 2,475,739 1 1,690,528 1 2,237,578 1 1,763,189 1 80,634 - 513,070 - 447,234 - 75,865 - - - 1,545,309 1 45,581 - 6,234 - 10,880,961 5 135,143,849 67 6,588,692 3 4,234,288 2 441,661 - 42,114,210 21 4,957 - 16,463 - - - 4,515,418 2 193,059,538 95 $ 203,940,499 100 $ 10,757,906 5 112,070 - 83,726 - 1,478,744 1 201,804 - 224,335 - 298,368 - 40,370 - 75,912 - 3,000,000 2 16,273,235 8 19,280,807 9 11,795,000 6 98,000 - 9,503,629 5 44,787 - 847,893 - 29,790 - 41,599,906 20 57,873,141 28 33,614,472 17 1,456,054 1 16,727,089 8 64,463,426 32 27,373,840 13 108,564,355 53 2,432,477 1 146,067,358 72 $ 203,940,499 100		2018
				Amount % $ 3,165,795 2 1,172,826 1 2,371,026 1 462,275 - 95,212 - 474,070 - 520,982 - 29,495 - 9,022 - 1,663,395 1 188,456 - 12,125 - 10,164,679 5 125,632,890 65 5,386,142 3 4,374,050 2 - - 41,689,694 22 8,344 - 12,603 - 369,801 - 5,192,895 3 182,666,419 95 $ 192,831,098 100 $ 11,437,104 6 268,218 - 40,661 - 1,415,215 1 188,104 - 214,593 - 8,477 - - - 75,912 - 4,000,000 2 17,648,284 9 12,192,567 6 15,025,011 8 98,000 - 9,020,630 5 - - 923,805 - 30,575 - 37,290,588 19 54,938,872 28 33,614,472 17 1,362,554 1 15,615,380 8 63,945,145 33 20,358,461 11 99,918,986 52 2,996,214 2 137,892,226 72 $ 192,831,098 100

The accompanying notes are an integral part of the financial statements.

(With Deloitte & Touche auditors’ report dated March 25, 2020)

137

ASIA CEMENT CORPORATION

STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OPERATING REVENUE (Notes 24 and 30) OPERATING COSTS (Notes 11, 24, 25 and 30) GROSS PROFIT (UNREALIZED) REALIZED GAIN ON TRANSACTIONS WITH SUBSIDIARIES AND ASSOCIATES REALIZED GROSS PROFIT OPERATING EXPENSES Administrative expenses (Notes 25 and 30) Expected credit loss (Note 10) Total operating expenses OPERATING LOSS NON-OPERATING INCOME AND EXPENSES Other income (Note 25) Other gains and losses (Note 25) Finance costs (Note 25) Share of profit of subsidiaries and associates Total non-operating income and expenses PROFIT BEFORE INCOME TAX INCOME TAX EXPENSE (Note 26) NET INCOME FOR THE YEAR		2019 Amount % $ 8,985,917 100 8,507,992 95 477,925 5 (8,442) - 469,483 5 678,405 7 3,753 - 682,158 7 (212,675) (2) 812,795 9 814,110 9 (369,349) (4) 17,111,219 190 18,368,775 204 18,156,100 202 696,427 8 17,459,673 194		2018
				Amount % $ 8,732,236 100 8,479,146 97 253,090 3 3,444 - 256,534 3 649,813 8 694 - 650,507 8 (393,973) (5) 592,445 7 (641,800) (7) (331,984) (4) 12,970,044 148 12,588,705 144 12,194,732 139 1,077,638 12 11,117,094 127 (Continued)

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ASIA CEMENT CORPORATION

STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OTHER COMPREHENSIVE INCOME, NET Items that will not be reclassified subsequently to profit or loss: Unrealized gain (loss) on investments in equity instruments at fair value through other comprehensive income Remeasurement of defined benefit plans Share of other comprehensive (loss) income of subsidiaries and associates Items that may be reclassified subsequently to profit or loss: Share of other comprehensive (loss) income of subsidiaries and associates Other comprehensive income for the year, net of income tax TOTAL COMPREHENSIVE INCOME FOR THE YEAR EARNINGS PER SHARE (Note 27) Basic Diluted		2019 Amount % $ 329,435 4 467,246 5 2,650,225 29 3,446,906 38 (3,254,043) (36) 192,863 2 $ 17,652,536 196 $ 5.56 $ 5.25		2018
				Amount % $ (9) - 265,965 3 1,426,545 17 1,692,501 20 1,758 - 1,694,259 20 $ 12,811,353 147 $ 3.54 $ 3.49

The accompanying notes are an integral part of the financial statements. (With Deloitte & Touche auditors’ report dated March 25, 2020) (Concluded)

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ASIA CEMENT CORPORATION

STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

Share Capital Issued Shares Amount Capital Surplus 3,361,447 $ 33,614,472 $ 1,168,692 - - - - - - - - - - - 185,411 - - 8,451 - - - - - - - - - - - - 3,361,447 33,614,472 1,362,554 - - - 3,361,447 33,614,472 1,362,554 - - - - - - - - - - - 93,500 - - - - - - - - - - - - 3,361,447 $ 33,614,472 $ 1,456,054	Retained Earnings		Other Equity
		Exchange Differences on Translating the Unrealized Gain (Loss) on Financial Assets Financial at Fair Value Statements of Through Other Foreign Comprehensive Operations Income $ (2,638,153 ) $ 516,962 - - - - - - - - - - - - (3,211 ) 1,343,257 - 3,408,697 - - (2,641,364 ) 5,268,916 - - (2,641,364 ) 5,268,916 - - - - - - - - - - (3,271,837 ) 2,719,118 - (79,711 ) - - $ (5,913,201) $ 7,908,323	Gains on Property Revaluation $ 307,728 - - - - - - - - - 307,728 - 307,728 - - - - - 77,486 - - $ 385,214	Cash Flow Hedge $ 58,485 - - - - - - 2,449 - - 60,934 - 60,934 - - - - - (8,793 ) - - $ 52,141
	Legal Reserve Special Reserve $ 15,068,480 $ 63,001,957 546,900 - - 943,188 - - - - - - - - - - - - - - 15,615,380 63,945,145 - - 15,615,380 63,945,145 1,111,709 - - 518,281 - - - - - - - - - - - - $ 16,727,089 $ 64,463,426
Shares 3,361,447 - - - - - - - - - 3,361,447 - 3,361,447 - - - - - - - - 3,361,447

The accompanying notes are an integral part of the financial statements.

(With Deloitte & Touche auditors’ report dated March 25, 2020)

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ASIA CEMENT CORPORATION

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM OPERATING ACTIVITIES
Income before income tax

Adjustments for:
Share of profit of subsidiaries and associates

Net gain on fair value changes of financial assets and liabilities
designated as at fair value through profit or loss
Depreciation expenses
Dividend income
(Gain) loss on changes in fair value of investment properties
Finance costs
Interest income
Unrealized loss on foreign exchange
Unrealized (realized) gain on transactions with subsidiaries and
associates
Expected credit loss recognized on trade receivables
Amortization expenses
Gain on disposal of property, plant and equipment
Write-downs of inventories
Effect of changes in exchange rate of bonds payable
Changes in operating assets and liabilities:
Notes receivable
Trade receivables
Other receivables
Inventories
Prepayments
Other current assets
Net defined benefit assets
Contract liabilities
Accounts payable and accrued expenses
Provisions
Deferred revenue

Cash generated from (used in) operations
Interest received
Dividend received
Interest paid
Income tax paid

Net cash generated from operating activities

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of financial assets at amortized cost
Increase (decrease) in refundable deposits
Payments for property, plant and equipment
Purchase of financial assets at fair value through other comprehensive
income

2019
2018
$ 18,156,100 $ 12,194,732
(17,111,219) (12,970,044)
(673,850)
(171,737)
523,626
464,781
(422,860)
(405,773)
(399,682)
331,211
369,349
331,984
(299,327)
(114,003)
143,442
44,425
8,442
(3,444)
3,753
694
3,589
3,297
(40)
(4,053)
-
52,791
-
300
14,578
7,091
27,930
(238,962)
(35,221)
1,322
67,546
(396,116)
107,544
(52,997)
5,891
(3,798)
(48,810)
(37,657)
43,065
(9,040)
57,642
189,552
-
48,000

(75,912)

(68,085)
465,576
(805,529)
288,178
112,952
7,345,508
4,296,112
(257,528)
(336,387)

(35,186)

(11,234)

7,806,548

3,255,914
(1,365,160)
-
679,526
(33,377)
(183,122)
(194,754)
(123,395)
-
(Continued)

141 -

ASIA CEMENT CORPORATION

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

Payments for investment properties Payments for intangible assets Proceeds from disposal of property, plant and equipment Proceeds from sale of financial assets at amortized cost Net cash (used in) generated from investing activities CASH FLOWS FROM FINANCING ACTIVITIES Repayments of long-term borrowings Proceeds from long-term borrowings Proceeds from issuance of bonds Dividends paid Repayments of bonds (Decrease) increase in short-term bills payable Repayment of the principal portion of lease liabilities Decrease in guarantee deposits received Net cash used in financing activities EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE OF CASH AND CASH EQUIVALENTS HELD IN FOREIGN CURRENCIES NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR The accompanying notes are an integral part of the financial statements. (With Deloitte & Touche auditors’ report dated March 25, 2020)	2019 $ (24,834) (202) 46 - (1,017,141) (61,746,000) 58,508,000 10,000,000 (9,412,164) (4,000,000) (680,000) (86,929) (785) (7,417,878) (61,585) (690,056) 3,165,795 $ 2,475,739	2018 $ (1,269) (2,693) 4,059 2,096,122 1,868,088 (18,588,000) 15,033,000 6,574,843 (4,033,715) (4,089,430) 2,310,000 - (1,010) (2,794,312) 20,179 2,349,869 815,926 $ 3,165,795 (Concluded)

※The Company and its affiliates have not experienced financial difficulties in the most recent fiscal year or during the current fiscal year up to the printing date of the annual report.

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VII Analysis of Financial Status, Operating Result, and Risk Management

7.1 Analysis of Financial Status

UNIT: NT$1,000

			UNIT: NT$1,000	UNIT: NT$1,000
Year Item	2018	2019	Variance
			Amount	%
Current Assets	80,358,506	89,242,066	8,883,560	11
Property, Plant and Equipment	52,549,341	50,681,281	(1,868,060)	(4)
Intangible Assets	3,694,783	7,000,317	3,305,534	89
Other Assets	142,585,368	150,354,848	7,769,480	5
Total Assets	279,187,998	297,278,512	18,090,514	6
Current Liabilities	62,804,294	74,335,619	11,531,325	18
Non-Current Liabilities	57,335,358	53,493,855	(3,841,503)	(7)
Total Liabilities	120,139,652	127,829,474	7,689,822	6
Equity Attributable To Owners Of The Corporation	137,892,226	146,067,358	8,175,132	6
Share Capital	33,614,472	33,614,472	-	-
Capital Surplus	1,362,554	1,456,054	93,500	7
Retained Earnings	99,918,986	108,564,355	8,645,369	9
Other Equity	2,996,214	2,432,477	(563,737)	(19)
Non-Controlling Interests	21,156,120	23,381,680	2,225,560	11
Total Equity	159,048,346	169,449,038	10,400,692	7
Analysis of deviation over 20%: 1. The increase of Intangible assets was mainlydue to the increase ofquarryright.

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7.2 Analysis of Financial Performance

UNIT: NT$1,000

			UNIT: NT$1,000	UNIT: NT$1,000
Year Item	2018	2019	Variance
			Amount	%
Operating Revenue	82,741,004	89,347,637	6,606,633	8
Operating Costs	61,584,690	63,746,928	2,162,238	4
Gross Profit	21,156,314	25,600,709	4,444,395	21
Realized (Unrealized) Gross Profit	15,147	(14,392)	(29,539)	(195)
Realized Gross Profit	21,171,461	25,586,317	4,414,856	21
Operating Expenses	3,018,351	3,523,141	504,790	17
Profit From Operations	18,153,110	22,063,176	3,910,066	22
Non-operating Income And Expenses	2,217,008	6,330,006	4,112,998	186
Income Before Income Tax	20,370,118	28,393,182	8,023,064	39
Income Tax Expense	5,480,921	6,149,229	668,308	12
Net Profit For The Year	14,889,197	22,243,953	7,354,756	49
Other Comprehensive Income , Net	1,436,173	(617,304)	(2,053,477)	(143)
Total Comprehensive Income For The Year	16,325,370	21,626,649	5,301,279	32
Net Profit Attributable To Owner Of The Company	11,117,094	17,459,673	6,342,579	57
Net Profit Attributable To Non-ControllingInterests	3,772,103	4,784,280	1,012,177	27
Total Comprehensive Income Attributable To Owner Of The Company	12,811,353	17,652,536	4,841,183	38
Total Comprehensive Income Attributable To Non-ControllingInterests	3,514,017	3,974,113	460,096	13
1. Analysis of deviation over 20%: (1).The increase of gross profit, realized gross profit and profit from operations were mainly due to the increase of average selling price of cement in mainland China in 2019. (2).The decrease of the realized gross profit resulted from the transactions with affiliated companies in 2019. (3).The increase of non-operating income was mainly due to the increase of investment income recognized under equity method, gain on fair value changes of financial assets and the decrease of net interest expense in 2019. (4).The increase of the income before income tax and net profit for the year were mainly due to the profit increase of business in mainland China, investment income recognized under equity method, gain on fair value changes of financial assets in 2019. (5).The decrease of net other comprehensive income was mainly due to the increase of exchange loss on translating the financial statements of foreign operations in 2019. 2. Expected sales volume in next one year and the reason for such expectation. The impact of such expectation on the Company’s financial situation and operational performances, and the Company’splan: Please refer to the “Letter to Shareholders”.

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7.3 Analysis of Cash Flow

(1)The Analysis for Changing of Cash Flow for 2019

3 Analysis of Cash Flow )The Analysis for Changing of Cash Flow for 2019	3 Analysis of Cash Flow )The Analysis for Changing of Cash Flow for 2019	3 Analysis of Cash Flow )The Analysis for Changing of Cash Flow for 2019	3 Analysis of Cash Flow )The Analysis for Changing of Cash Flow for 2019
				Unit: NT$1,000
Cash Balance in the Beginning	Net Cash Inflows from Operating Activities	Total Cash Outflows	The Cash Surplus	Source of Funding for Negative Cash Balance
				Investing Plans	Financing Plans
14,929,411	37,271,901	27,465,817	24,735,495	-	-

Operating Activities: Mainly generated from operations NT$38,647,173 thousand and dividends received NT$4,062,869 thousand .
Investing Activities: Mostly for net increase in financial assets NT$8,990,814 thousand and net increase in property, plant and equipment NT$3,717,143 thousand.
Financing activities: Mostly for cash dividends paid NT$9,412,164 thousand.
(2)Remedy plans for insufficient liquidity for 2019 ： Not Applicable.
(3)Liquidity Analysis for the Coming Year

Unit: NT$1,000

Cash Balance in the Beginning	Expected Net Cash Inflows from Operating Activities	Expected Total Cash Outflows	Expected Cash Surplus	Expected Source of Funding for Negative Cash Balance	Expected Source of Funding for Negative Cash Balance
				Investing Plans	Financing Plans
24,735,495	20,455,140	26,683,732	18,506,903	-	-

Operating Activities ： Mainly from operating income and cash dividends received.
Investing Activities ： Primarily for investment in capital expenditures.
Financing activities: Mostly for net increase in short-term and long-term loans and payout of cash dividends.

7.4 Impacts of Major Capital Expenditures on Finance and Operation

7.4.1 Major Capital Expenditures and Funding Sources

UNIT: NT$1,000

				UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000	UNIT: NT$1,000
Projects	Actual or Expected Source of Capital	Actual or Expected Date of Completion	Total Capital	Capital Expenditures
				Actual		Expected
				2012~2018	2019	2020	2021	2022	2023
Installation constructions of new indoor coal bunker , stacker reclaimer and material conveyor system in Hualien plant	Self-owned capital	Dec. 2023	556,160	9,164	75	11,500	140,000	100,000	295,421
Chiahui Power natural gas fueled combined cycle power plant (Phase II Expansion)	Syndicated loan	Dec. 2020	10,527,736	2,874,902	2,295,186	5,357,648	-	-	-

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7.4.2 Expected Benefit to Finance and Operation from the Major Capital Expenditure

Installation constructions of new indoor coal bunker, stacker reclaimer and material conveyor system in Hualien plant
(1) To prevent coal heaps from collapsing due to heavy rain, and the corresponding cost from the damage to the machine and from rebuilding the coal heaps, and to ensure the water discharge during the period is in compliance with the environmental regulations.
(2) To prevent coal from absorbing excessive water during the heavy rain, which could cause some loss due to the reduction or interruption of clinker production.
After the completion of the natural gas fueled combined cycle power plant (Phase II Expansion) of Chiahui Power, it will increase the stable profit every year.

7.5 Investment Strategies in the Most Recent Year, the Major Reasons for its

Gain or Loss and Improvement Plan and Investment Plans for Next Year

The majority of the Company’s investments were for long-term strategic purposes. In 2019, the total gain through equity method by the company was NT$ 5,490,375 (on consolidated basis). In the future, the Company will continue to focus on strategic purposes through prudent assessment.

7.6 Analysis and Evaluation of Risk Management

7.6.1 The Impact of Fluctuation of Foreign Exchange, Interest Rates, and Inflation on the Company’s Profit and Loss and Its Countermeasures

※ Foreign exchange impact:

The percentage of foreign exchange gains/losses over operating revenue and operating income in 2019 are as follows:

Unit ： NT$1,000

	Unit：NT$1,000
Item\Year	2019
Foreign Exchange Gains(Losses) (A)	(260,069)
OperatingRevenue(B)	89,347,637
% of OperatingRevenue(A)/(B)	(0.3%)
OperatingIncome(C)	22,063,176
% of OperatingIncome(A)/(C)	(1.2%)

Foreign exchange rate fluctuates constantly because of the variation in market demand and supply. Thus, the risk of foreign exchange may occur to the Company by means of various trading. For the Company, most of the procurements of raw materials were disbursed in USD; foreign sales were collected in USD. Currently, the revenue mostly

146 -

equals to the disbursement, which led to the effect of natural hedge, minimizing the impact of fluctuation of foreign exchange on the Company’s profit and loss.

Besides natural hedge, in order to minimize the risk of foreign exchange, the Company

and subsidiaries had adopted such risk management policies against the uncertainty.

Monitoring the impact to foreign exchange rate from global macro-economic change and building up a necessary hedge mechanism.
Planning future’s demand for currencies and establishing the foreign currency position from relatively lower level to reduce overall cost. Convert weak currencies to strong currencies.

※ Interest rate impact:

The percentage of interest revenue/losses over operating revenue and operating income in 2019 are as follows:

in 2019 are as follows:
	Unit：NT$1,000
Item\Year	2019
Interest Revenue(Losses) (A)	(694,622)
OperatingRevenue(B)	89,347,637
% of OperatingRevenue(A)/(B)	(0.8%)
OperatingIncome(C)	22,063,176
% of OperatingIncome(A)/(C)	(3.1%)

If market interest rates had been 0.01% higher/lower, the group’s pretax profit for the year ended December 31, 2019 would have decreased/increased by NT$2,238 thousand, mainly due to the Group’s exposure to interest rates on its floating-rate bank borrowings and bank deposits’ interest revenue and expenses.

The Company primarily utilizes short-term bank loans and issues long-term debt instruments to finance its short, mid, and long term funding demands.

According to the terms and conditions of agreements entered with banks, short-term bank loan, subject to floating interest rate basis, can be utilized in revolving method within the duration of the agreements. Since the Company has been maintaining stable status operationally and financially, it is capable of obtaining relatively lower interest rate with aggressive negotiations with banks. Besides, the duration of utilizing short-term loan is less than one year. In a whole, the impact of the fluctuation of interest rates on the Company’s short-term loans is limited. In order to minimize the risk of interest rate, the Company and subsidiaries had adopted such risk management policies against the uncertainty:

The Company mainly issues long-term and fixed interest rate debt instruments to lock relatively lower funding cost, which can reduce interest expense and impact of interest fluctuation, spare banks’ credit lines for temporary funding demand, replenish working

147 -

capital, and improve financial structure to comply with the principle for long-term sustainable operation.

※ Inflation rate impact:

Taiwan inflation rate was about 0.56% in 2019. This inflation rate did not have substantial effect on the Company’s operation and profit. In order to minimize the risk of inflation rate, the Company and subsidiaries maintained stable and long-term cooperative relationships with our major suppliers.

7.6.2 The Impact of Highly Risky Investments, Highly Leveraged Transaction, Loaning to Others, Endorsement and Guarantee for Others, and Derivatives

The Company has no highly risky and highly leveraged investments or loaning to others.

The Company provided endorsement and guarantee for its subsidiaries according to “Procedures for Endorsement and Guarantee”. Its balance was NT$25,561,342,000 and NT$ 26,333,392,000 by the end of 2019 and the end of March 2020 respectively. Based on conservative operating policy, the operations of its subsidiaries bring considerable income to the Company. Besides that, the Company supervises its subsidiaries regularly and controls related risks.

The financial transactions with “derivative” nature which the Company entered into were strictly for hedging purposes and not for any trading or speculative purposes. To control various types of financial trading risks, the Company has established internal policies and procedures based on sound financial and business practices, and in compliance with the relevant rules and regulations issued by the Taiwan Securities and Futures Bureau. The Company entered into USD/TWD CCS transactions and its balance was NT$6,634,450,000 (fair value was NT$6,604,104,000) by the end of 2019, and NT$ 6,634,450,000 (fair value was NT$6,664,717,000) by the end of March 2020.

7.6.3 The Prevention of Legal Risks

In view of current company’s operations, in addition to compliance with laws and regulations, there are many different areas involved in the legal norms, such as dealing with other companies, government agency, stakeholders, employees, and other foreign-related cases. Preventing legal risks shall be the first priority in today’s business operators

In response to this situation, the Company asks those who majored in law to be in charge of the Secretarial Department. Besides, the Company teaches and requires every employee to comply with every regulation in daily operations. The Company also cooperates with the Group’s legal department to handle labor, general affairs, sales, factory management, taxation and other issues. Lawyers and accountants would be consulted if necessary. These could ensure legal risks reduced to maintain the Company's interests.

◎R&D project and estimated expenditures in the future:

Unit: NT$1,000

148 -

Item	Item	Amount
1	Development of WeighingSystem in Hualien Plant	800
2	Industry 4.0 Phase 3 Project: Smart Occupational Safety, Data Analysis Applied to Production, QualityControl,and Segment Cost Analysis	9,000
3	Establish a systematic observation and analysis method of cement and clinker to introduce routine control	1,500
4	Technology for improving the ability of using alternative materials for circular economy	50,400
5	ReplacingNo. 2 kiln PLC system equipment	6,000
6	Renewal of PLC system equipment forpackagingand shipping	2,800
	Total	70,500

◎Effect on the Company’s finance and operation from any changes in major policies and laws at home and abroad in the most recent fiscal year: None.
◎Effect on the Company's finance and operation due to the technological improvement and the change of industrial environment in the most recent fiscal year: None.
◎Events influencing the Company's corporate image in the most recent fiscal year: None.
◎Merger or acquisition plan in the most recent fiscal year: None.
◎Plan of expanding capacity in the most recent fiscal year: None.
◎Supply and sale of the Company in the most recent fiscal year: Normal and steady.
◎Large volume shares transferred or changed by directors, supervisors, or shareholders with more than 10% shareholdings in the most recent fiscal year: None.
◎Change of the Company’s management in the most recent fiscal year: None.
◎Litigation, non-litigation incidents or administrative disputes of directors, supervisors, president, shareholders with more than 10% shareholdings, or subsidiaries which could materially affect shareholders' equity or the prices of the Company's securities: None.
◎Other major risks: None.

7.7 Other Mentionable Issues : None.

149 -

VIII Special Disclosure

==> picture [718 x 639] intentionally omitted <==

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8.1 Organizational Chart of Affiliated Companies
0.03%
0.02%
FU MING TRANSPORTATION CO., 99.87%
99.82% LTD. FU DA TRANSPORTATION CO., LTD. 100.00% RUICHANG YADONG NEW
MATERIAL CO, LTD.
100.00%
YUAN LONG STAINLESS STEEL
CORP. 100.00% NANCHANG YALI CONCRETE
PRODUCE LTD.
100.00% SUNRISE INDUSTRIAL HOLDINGS LTD. 100.00% ASIA CONTINENT INVESTMENT HOLDINGS PTE. LTD. 85.00% JIANGXI YADONG CEMENT CO.,LTD. 51.99% JIANGXI YALI TRANSPORT CO., LTD.
10.00%
99.94% 50.00%
0.02% NAN HWA CEMENT CORP . NANCHANG YADONG CEMENT CO., LTD.
25.00%
98.23% ASIA ENGINEERING ENTERPRISE 90.00% HUANGGANG YADONG CEMENT
0.07% CORP. CO., LTD. 10.00%
0.20% 90.00% WUHAN YADONG CEMENT CO., LTD. 100.00% WUHAN YALI CEMENT PRODUCTS CO., LTD.
ASIA 67.73% ASIA CEMENT (CHINA) HOLDINGS CO. 100.00% PERFECT INDUSTRIAL HOLDINGS PTE. LTD. 100.00% 10.00% 48.00%
CEMENT ORIENTAL HOLDINGS CO., LTD.
CORP. 4.07% 100.00%
TAIZHOU YADONG BUILDING
99.96% 100.00% 51.22% CHENGDU YALI CEMENT MATERIAL CO., LTD.
ASIA CEMENT(SINGAPORE)PTE. LTD. ORIENTAL CONCRETE PTE.LTD. PRODUCTS CO.,LTD. 48.78%
ORIENTAL INDUSTRIAL
HOLDINGS PTE. LTD.
0.39% 99.56% FU SHAN MINERAL STONE CO.,LTD. 99.99% 50.00% SHANGHAI YAFU CEMENT PRODUCTS CO., LTD.(Note) 15.00%
49.00% KOWLOON CEMENT CORP. LTD. 100.00% KOWLOON CONCRETE CORP. 90.00% 35.00%
99.99% 100.00% LTD. SHANGHAI YALI CEMENT 10.00%
0.001% DER CHING INVESTMENT CORP. AC MEGA INVESTMENT LTD. PRODUCTS CO., LTD.
100.00% AC LEAP INVESTMENT LTD. 100.00% JOIN FORTUNE TRADING LTD. 90.00% SICHUAN YALI CONCRETE 10.00%
100.00% PRODUCE CO., LTD.
51.00% YA LI TRANSPORTATION CORP. 100.00% AC MEGA II INVESTMENT LTD. 90.00% SICHUAN YALI TRANSPORT CO., LTD. 10.00%
AC MEGA III INVESTMENT LTD.
100.00% AC MEGA IV INVESTMENT LTD. 90.00% YANGZHOU YADONG CEMENT CO., LTD. 10.00% SICHUAN LANFENG BUILDING MATERIALS CO., LTD.
99.99% 100.00%
83.81% YA LI PRECAST ANDPRESTRESSED CONCRETE INDUSTRIES CORP. YA LI PRECAST PVT. LTD. CONCRETE INDIA 90.00% SICHUAN YADONG CEMENT CO., LTD. 10.00% SICHUAN LANFENG CEMENT CO.,LTD.
100.00%
PT YATUNG CONCRETE INTERNATIONAL CORP.99% 1% 95.04% 4.96% ASIA ORIENTAL (GUAM) L.L.C. 71.68% ASIA ORIENTAL CONCRETE, LLC 90.00% HUBEI YADONG CEMENT CO.,LTD. 10.00%100.00% HUBEI YALI TRANSPORT CO., LTD.
99.99% YA TUNG READY-MIXED 100.00% YATUNG VIETNAM CO., LTD.
CONCRETE CORP. 90.00%
WUHAN YAXIN CEMENT CORP.
0.004% 69.93% YA SING READY-MIXED LTD.
CONCRETE CORP.
0.05%
100.00% ASIA CEMENT EXPLORER
INVESTMENT LTD.
100.00%
ASIA INVESTMENT CORP. 100.00% ASIA CEMENT PIONEER
INVESTMENT LTD.
0.01%
100.00%
ASIA CEMENT PIONEER II
INVESTMENT LTD.
59.59%
CHIAHUI POWER CORP. 100.00%
ASIA CEMENT PIONEER III
INVESTMENT LTD.
100.00% ASIA CEMENT PIONEER IV
INVESTMENT LTD.
Note : The Group established RUICHANG YADONG NEW MATERIAL CO, LTD. on Jan 29, 2019.
----- End of picture text -----

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8.2 Basic Information of Affiliated Companies

Currency: NT$ (except otherwise specified) Unit: $1,000

		Unit: $1,000	Unit: $1,000
		As of December 31,2019
Company Name	Establishing	Paid-in	Main business or
	Date	Capital	Production Item
FU MING TRANSPORTATION CO., LTD.	Feb. 1980	295,695	Transportation
Address: 23F., No.16-1, Xinzhan Rd., Banqiao Dist.,
NewTaipeiCity
YUAN LONG STAINLESS STEEL CORP.	Dec. 2005	2,000,000	Stainless steel
Address: No.28, Daye S. Rd., Xiaogang Dist.,
Kaohsiung City
SUNRISE INDUSTRIAL HOLDINGS LTD.	Apr. 1996	USD	Investment
Address: Portcullis Chambers, 4th Floor, Ellen		90
Skelton Building, 3076 Sir Francis Drake
Highway, Road Town, Tortola, VG1110,
BritishVirgin Islands
NAN HWA CEMENT CORP.	May. 1979	261,440	Cement,
Address: No.90, Sec. 2, Linkong. Rd., Longchin			Blast-Furnace Slag,
Dist., Taichung City			Limestone Slag
ASIA ENGINEERING ENTERPRISE CORP.	Nov. 1982	81,144	Engineering
Address: No.125, Xinxing Rd., Xincheng Township,
HualienCounty
ASIA CEMENT (CHINA) HOLDINGS CO.	Apr. 2004	HKD	Investment
Address: Century Yard, Cricket Square, Hutchins		156,685
Drive, P.O. Box 2681GT, George Town,
Grand Cayman,BritishWestIndies
ASIA CEMENT (SINGAPORE) PTE. LTD.	Apr. 1964	SGD	Cement
Address: 5 Little Road #09-01 Cemtex Industrial		10,500
Building Singapore 536983
DER CHING INVESTMENT CORP.	Dec. 1988	5,956,218	Investment
Address: 31F., No.207, Sec. 2, Dunhua S. Rd., Da’an
Dist.,TaipeiCity
YA LI TRANSPORTATION CORP.	Oct. 1980	100,000	Transportation
Address: No.125, Xinxing Rd., Xincheng Township,
HualienCounty
YA LI PRECAST AND PRESTRESSED	Nov. 1990	193,776	Cement products
CONCRETE INDUSTRIES CORP.
Address: No.3, Sec. 2, Jiayuan Rd., Shulin Dist.,
NewTaipeiCity
YA TUNG READY-MIXED CONCRETE CORP.	Jan. 1999	1,590,750	Ready-mixed
Address: No.139, Sec. 1, Datong Rd., Xizhi Dist.,			concrete, Cement
New Taipei City			products
ASIA INVESTMENT CORP.	Oct. 1998	2,220,396	Investment
Address: 31F., No.207, Sec. 2, Dunhua S. Rd., Da’an
Dist.,TaipeiCity
CHIAHUI POWER CORP.	Apr. 1996	4,700,000	Power plant
Address: No.688, Songzijiao, Minxiong Township,
ChiayiCounty
FU DA TRANSPORTATION CO., LTD.	Feb. 1989	279,279	Transportation
Address: 23F., No.16-1, Xinzhan Rd., Banqiao Dist.,
NewTaipeiCity
PERFECT INDUSTRIAL HOLDINGS PTE. LTD.	May. 1997	USD	Investment
Address: Portcullis Chambers, 4th Floor, Ellen		9,720
Skelton Building, 3076 Sir Francis Drake
Highway, Road Town, Tortola, VG1110,
BritishVirgin Islands
ORIENTAL CONCRETE PTE. LTD.	Oct. 1980	SGD	Ready-mixed
Address: 5 Little Road #09-01 Cemtex Industrial		17,000	concrete, Leasing
BuildingSingapore 536983

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Company Name	Establishing	Paid-in	Main business or
	Date	Capital	Production Item
FU SHAN MINERAL STONE CO., LTD.	Dec. 1970	13,000	Mining excavation,
Address: No.125, Xinxing Rd., Xincheng Township,			mineral processing
HualienCounty			and sales
KOWLOON CEMENT CORP. LTD.	Sep. 1986	HKD	Cement
Address: 11/F Lippo Leighton Tower, 103 Leighton		23,000
Road, CausewayBay,HongKong
AC MEGA INVESTMENT. LTD.	Nov. 2010	USD	Investment
Address: Portcullis Chambers, 4th Floor, Ellen		27,700
Skelton Building, 3076 Sir Francis Drake
Highway, Road Town, Tortola, VG1110,
BritishVirgin Islands
AC LEAP INVESTMENT. LTD.	Nov. 2010	USD	Investment
Address: Portcullis Chambers, 4th Floor, Ellen		28,300
Skelton Building, 3076 Sir Francis Drake
Highway, Road Town, Tortola, VG1110,
BritishVirgin Islands
AC MEGA II INVESTMENT. LTD.	Jun. 2011	USD	Investment
Address: Portcullis Chambers, 4th Floor, Ellen		10,000
Skelton Building, 3076 Sir Francis Drake
Highway, Road Town, Tortola, VG1110,
BritishVirgin Islands
AC MEGA III INVESTMENT. LTD.	Jun. 2011	USD	Investment
Address: Portcullis Chambers, 4th Floor, Ellen		10,000
Skelton Building, 3076 Sir Francis Drake
Highway, Road Town, Tortola, VG1110,
BritishVirgin Islands
AC MEGA IV INVESTMENT. LTD.	Jun. 2011	USD	Investment
Address: Portcullis Chambers, 4th Floor, Ellen		26,100
Skelton Building, 3076 Sir Francis Drake
Highway, Road Town, Tortola, VG1110,
BritishVirgin Islands
YA LI PRECAST CONCRETE INDIA PVT. LTD.	Jun. 2007	INR	Cement products
Address: 7/241,2nd Floor, Sunder Vihar, Paschim		16,000
Vihar, NewDelhi-110087
ASIA ORIENTAL (GUAM) L.L.C	Aug. 2010	USD	Investment
Address: 136 Adrian Sanchez Street Tamuning, GU		10,000
96913
PT YATUNG CONCRETE INTERNATIONAL	Sep. 2018	USD	Ready-mixed
Address: Jl.Cipendawa Baru Rt. 004 Rw. 004 kel.		4,700	concrete, Cement
Bojong Menteng Kec. Rawalumbu Kota Bekasi			products
YATUNG VIETNAM CO. LTD.	Feb. 2010	VND	Ready-mixed
Address: Supporting Industrial Zone, Vung Ang		141,348,502	concrete
Economic Zone, Ky Phuong Ward, Ky Anh
town,HaTinh Province, Viet Nam
YA SING READY-MIXED CONCRETE CORP.	Apr. 2000	100,000	Ready-mixed
Address: No.350, Niupu S. Rd., Xiangshan Dist.,			concrete
Hsinchu City
ASIA CEMENT EXPLORER INVESTMENT. LTD.	Aug. 2008	USD	Investment
Address: Portcullis Chambers, 4th Floor, Ellen		20,915
Skelton Building, 3076 Sir Francis Drake
Highway, Road Town, Tortola, VG1110,
BritishVirgin Islands
ASIA CEMENT PIONEER INVESTMENT. LTD.	Aug. 2008	USD	Investment
Address: Portcullis Chambers, 4th Floor, Ellen		68,550
Skelton Building, 3076 Sir Francis Drake
Highway, Road Town, Tortola, VG1110,
British Virgin Islands

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Company Name	Establishing	Paid-in	Main business or
	Date	Capital	Production Item
ASIA CEMENT PIONEER II INVESTMENT. LTD.	Jun. 2011	USD	Investment
Address: Portcullis Chambers, 4th Floor, Ellen		28,000
Skelton Building, 3076 Sir Francis Drake
Highway, Road Town, Tortola, VG1110,
BritishVirgin Islands
ASIA CEMENT PIONEER III INVESTMENT. LTD.	Jun. 2011	USD	Investment
Address: Portcullis Chambers, 4th Floor, Ellen		19,500
Skelton Building, 3076 Sir Francis Drake
Highway, Road Town, Tortola, VG1110,
BritishVirgin Islands
ASIA CEMENT PIONEER IV INVESTMENT. LTD.	Jun. 2011	USD	Investment
Address: Portcullis Chambers, 4th Floor, Ellen		19,010
Skelton Building, 3076 Sir Francis Drake
Highway, Road Town, Tortola, VG1110,
BritishVirgin Islands
ASIA CONTINENT INVESTMENT HOLDINGS	Apr. 1995	USD	Investment
PTE. LTD.		288,847
Address: 5 Little Road #09-01 Cemtex Industrial
Building Singapore 536983
ORIENTAL INDUSTRIAL HOLDINGS PTE. LTD	May. 1994	USD	Investment
Address: 5 Little Road #09-01 Cemtex Industrial		837,744
Building Singapore 536983
KOWLOON CONCRETE CORP. LTD.	Mar. 1992	HKD	Ready-mixed
Address: 11/F Lippo Leighton Tower, 103 Leighton		10	concrete, Barges
Road, CausewayBay,HongKong
JOIN FORTUNE TRADING LTD	Jul. 2012	USD	Investment
Address: 263 MAIN STREET, ROAD TOWN,		2,980
TORTOLA,BRITISHVIRGINISLANDS
ASIA ORIENTAL CONCRETE,LLC	Mar. 2011	USD	Ready-mixed
Address: 136 Adrian Sanchez Street Tamuning,		11,600	concrete, Cement
GU 96913			products
JIANGXI YADONG CEMENT CO., LTD.	Oct. 1997	USD	Cement, Clinker,
Address: No.6, Yadong Road, Ma-Tou Town, Rui		356,104	Blast-Furnace Slag,
Chang City, Jiangxi Province, China			Cement products
HUANGGANG YADONG CEMENT CO., LTD.	Aug. 2006	USD	Cement, Clinker,
Address: 5 Tiyu Avenue,Huangzhou Zone，		86,170	Blast-Furnace Slag,
Huanggang City,Hubei Province, China			Cement products
WUHAN YADONG CEMENT CO., LTD.	Nov. 1999	USD	Cement Grinding,
Address: Cihui Avenue, Wujiashan Taiwan Business		36,140	Blast-Furnace Slag
InvestmentZone,Dongxihu, Wuhan, China
ORIENTAL HOLDINGS CO., LTD.	Jul. 2003	USD	Investment
Address: Room 305A,No 2875,South Yanggao Rd,		204,188
Pudong NewArea, Shanghai
CHENGDU YALI CEMENT PRODUCTS CO.,	Dec. 2004	USD	Ready-mixed
LTD.		4,100	concrete,
Address: No.68 AnPeng Road, Tianpeng Town,			Cement products
Pengzhou, Chengdu City, Sichuan, China
SHANGHAI YALI CEMENT PRODUCTS CO.,	Nov. 1995	USD	Ready-mixed
LTD.		15,000	concrete,
Address: No.3000 Longwu Road Minhang			Cement products
ShanghaiChina
SICHUAN YALI CONCRETE PRODUCE CO.,	Nov. 2005	USD	Ready-mixed
LTD.		3,300	concrete,
Address: No.268,Three Passage,Wenquan Road			Cement products
Wenjiang District,Chendu
City,Sichuan,China
SICHUAN YALI TRANSPORT CO., LTD.	May. 2006	USD	Transportation
Address: No.68 AnPeng Road, Tianpeng Town,		3,500
Pengzhou,Chengdu City,Sichuan,China

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Company Name	Establishing	Paid-in	Main business or
	Date	Capital	Production Item
YANGZHOU YADONG CEMENT CO., LTD.	Jul. 2006	USD	Cement Grinding,
Address: No.7 Gudu Road BaliTown, Yangzhou		35,530	Blast-Furnace Slag,
Economic Development Zone Yangzhou			Ready-mixed
City Jiangsu Province China			concrete, Cement
			products
SICHUAN YADONG CEMENT CO., LTD.	Nov. 2004	USD	Cement, Clinker,
Address: No.66 AnPeng Road, Tianpeng Town,		368,340	Blast-Furnace Slag,
Pengzhou, Chengdu City, Sichuan, China			Cement products
HUBEI YADONG CEMENT CO., LTD.	Jun. 2005	USD	Cement, Clinker,
Address: No.66 Ya Dong Avenue, Pingjiang West		154,800	Blast-Furnace Slag,
Road, Yangluo Economic Development			Cement products
Zone, WuhanCity,Hubei Province, China
NANCHANG YALI CONCRETE PRODUCE LTD.	Dec. 2003	RMB	Ready-mixed
Address: Melin AVE Bashuihu Industries Zone		60,000	concrete,
NanchangETDZJiangxi Province			Cement products
JIANGXI YALI TRANSPORT CO., LTD.	Apr. 2005	RMB	Transportation
Address: No.8, Yadong Road, Ma-Tou Town, Rui		12,500
Chang City, Jiangxi Province, China
NANCHANG YADONG CEMENT CO., LTD.	Jan. 2004	RMB	Cement Grinding,
Address: Industrial 2nd Rd, Changdong Industrial		90,000	Blast-Furnace Slag
Park, Nanchang Jiangxi, China
WUHAN YALI CEMENT PRODUCTS CO., LTD.	Dec. 2007	RMB	Ready-mixed
Address: No.66 Ya Dong Avenue, Pingjiang Went		60,000	concrete,
Road, Yangluo Economic Development			Cement products
Zone, WuhanCity,Hubei Province, China
TAIZHOU YADONG BUILDING MATERIAL CO.,	Sep. 2013	USD	Cement
LTD.		16,000	warehousing and
Address: Central Village of Yong anzhou Town,			wholesale
Gaogang District, Thaizhou, Jiangsu
Province, China
RUICHANG YADONG NEW MATERIAL CO.,	Jan. 2019	RMB	construction
LTD.		2,000	material and product
Address: No.6, Yadong Road, Ma-Tou Town, Rui
Chang City, Jiangxi Province, China
SICHUAN LANFENG BUILDING MATERIALS	Nov. 2010	RMB	Cement products,
CO., LTD.		20,000	Construction
Address: Middle, Qinggui Road, Guihua Town,
Pengzhou, Chengdu City, Sichuan, China
SICHUAN LANFENG CEMENT CO., LTD.	Sep. 2008	RMB	Cement, Clinker,
Address: Middle, Qinggui Road, Guihua Town,		600,000	Blast-Furnace Slag,
Pengzhou, Chengdu City, Sichuan, China			Cement products
HUBEI YALI TRANSPORT CO., LTD.	Oct. 2006	RMB	Transportation
Address: Cihui Avenue, Wujiashan Taiwan Business		13,000
Investment Zone, Dongxihu, Wuhan, Hubei
Province, China
WUHAN YAXIN CEMENT CO., LTD.	Aug. 2003	RMB	Cement, Clinker,
Address: Jiangjun mountain, Jiangxia District,		90,000	Blast-Furnace Slag,
Wuhan,Hubei Province,China			Cementproducts

8.3 Main Business of Affiliated Companies

Please Refer to Above List.

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8.4 Information of the Directors, Supervisors, and Presidents of Affiliated Companies

Companies
			As of December 31,2019
Company Name	Title	Name or Representative	Shareholding
			Shares	%
FU MING TRANSPOR- TATION CO., LTD.	Chairman	Johnny Shih(ACCRepresentative)	29,517,188	99.82
	Director/President	W.T.Hsu (ACCRepresentative)	29,517,188	99.82
	Director	K.Y.Lee (ACCRepresentative)	29,517,188	99.82
	Director	Y.F. Chang (ACCRepresentative)	29,517,188	99.82
	Director	C.M. Chen (ACC Representative)	29,517,188	99.82
	Director	C.H. Chung (ACC Representative)	29,517,188	99.82
	Director	R.K. Tsai (ACC Representative)	29,517,188	99.82
	Supervisor	T.L. Yu (Asia Investment Corp. Representative)	5,000	0.02
	Supervisor	Humphrey Cheng (Asia Investment Corp. Representative)	5,000	0.02
YUAN LONG STAINLESS STEEL CORP.	Chairman	K.Y.Lee (ACCRepresentative)	200,000,000	100.00
	Director/President	B.R. Cheng (ACCRepresentative)	200,000,000	100.00
	Director	Peter Hsu (ACCRepresentative)	200,000,000	100.00
	Director	C.F. Cheng (ACCRepresentative)	200,000,000	100.00
	Director	C.M. Chen(ACCRepresentative)	200,000,000	100.00
	Supervisor	Doris Wu (ACC Representative)	200,000,000	100.00
	Supervisor	T.M. Chen (ACC Representative)	200,000,000	100.00
SUNRISE INDUSTRIAL HOLDINGS LTD.	Director	Douglas Tong Hsu (ACC Representative)	90,000	100.00
	Director	Peter Hsu (ACC Representative)	90,000	100.00
	Director	K.Y. Lee (ACC Representative)	90,000	100.00
	Director	R.H. Shao (ACC Representative)	90,000	100.00
	Director	Doris Wu (ACCRepresentative)	90,000	100.00
NAN HWA CEMENT CORP.	Chairman/President	Y.F. Chang (ACCRepresentative)	26,128,171	99.94
	Director	Peter Hsu (ACCRepresentative)	26,128,171	99.94
	Director	Doris Wu (ACCRepresentative)	26,128,171	99.94
	Director	T.M. Chen(ACCRepresentative)	26,128,171	99.94
	Director	C.H. Chen (ACC Representative)	26,128,171	99.94
	Supervisor	W.H. Yeh (Asia Investment Corp. Representative)	5,000	0.02
ASIA ENGINEERING ENTERPRISE CORP.	Chairman	Y.F. Chang (ACC Representative)	7,970,703	98.23
	Director / President	Z.P. Chang (ACC Representative)	7,970,703	98.23
	Director	Peter Hsu	6,817	0.08
	Director	K.Y. Lee (ACC Representative)	7,970,703	98.23
	Director	C.H. Chen(ACCRepresentative)	7,970,703	98.23
	Supervisor	H.Y. Kao (Asia Investment Corp. Representative)	6,000	0.07
ASIA CEMENT (CHINA) HOLDINGS CO.	Chairman / Non-Executive Director	Douglas Tong Hsu	3,000,000	0.19
	Vice Chairman / Executive Director	Peter Hsu	200,000	0.01
	Executive Director	T.H. Chang	429,500	0.03
	Executive Director	Doris Wu	20,000	0.00
	Executive Director	Z.L. Wu	258,000	0.02
	Executive Director	C.K. Chang	462,500	0.03
	Executive Director	S.J. Lin	290,000	0.02
	Independent Non - Executive Director	D.L. Zhan	0	0.00
	Independent Non - Executive Director	K.C. Lee	0	0.00
	Independent Non - ExecutiveDirector	K.M. Wang	0	0.00

-155-

Company Name	Title	Name or Representative	Shareholding	Shareholding
			Shares	%
	Independent Non - Executive Director	Wei Wang	0	0.00
ASIA CEMENT (SINGAPORE) PTE. LTD.	Chairman / Managing Director	Douglas Tong Hsu	2	0.00
	Vice Managing Director	J.H. Lin (ACC Representative)	10,495,495	99.96
	Director	Peter Hsu (ACC Representative)	10,495,495	99.96
	Director	K.Y. Lee (ACC Representative)	10,495,495	99.96
	Director	Y.F. Chang (ACC Representative)	10,495,495	99.96
	Director	R.H. Shao (ACC Representative)	10,495,495	99.96
	Director	Doris Wu (ACC Representative)	10,495,495	99.96
	Director	Gary Lee (ACC Representative)	10,495,495	99.96
DER CHING INVESTMENT CORP.	Chairman	Peter Hsu (ACC Representative)	595,576,603	99.99
	Director	Doris Wu (ACC Representative)	595,576,603	99.99
	Director	T.M. Chen (ACC Representative)	595,576,603	99.99
	Director	H.Y. Kao (ACC Representative)	595,576,603	99.99
	Director	H.T. Peng (ACC Representative)	595,576,603	99.99
	Supervisor	Karen Yang (Asia Investment Corp. Representative)	5,401	0.00
YA LI TRANSPORTATION CORP.	Chairman	Y.F. Chang (Yu Yuan Investment Corp. Representative)	4,839,183	48.39
	Director	Z.P. Chang (Yu Yuan Investment Corp. Representative)	4,839,183	48.39
	Director	C.H. Chung (Yu Yuan Investment Corp. Representative)	4,839,183	48.39
	Director	C.H. Chen (Yu Yuan Investment Corp. Representative)	4,839,183	48.39
	Director	W.T. Hsu (Yu Yuan Investment Corp. Representative)	4,839,183	48.39
	Supervisor	Dana Lee (ACC Representative)	5,100,000	51.00
YA LI PRECAST AND PRESTRESSED CONCRETE INDUSTRIES CORP.	Chairman	C.F. Cheng (ACC Representative)	16,241,083	83.81
	Director	Peter Hsu(ACC Representative)	16,241,083	83.81
	Director	Lin Kuo(ACC Representative)	16,241,083	83.81
	Director	T.L. Yu(ACC Representative)	16,241,083	83.81
	Director	C.H. Chen(ACC Representative)	16,241,083	83.81
	Supervisor	Dana Lee(FEGC Representative)	3,105,647	16.03
YA TUNG READY-MIXED CONCRETE CORP.	Chairman	K.Y. Lee(ACC Representative)	159,067,779	99.99
	President	C.P. Chen	0	0.00
	Director	Peter Hsu	156	0.00
	Director	Y.F. Chang (ACC Representative)	159,067,779	99.99
	Director	W.K. Chou(ACC Representative)	159,067,779	99.99
	Director	C.M. Chen(ACC Representative)	159,067,779	99.99
	Supervisor	Doris Wu (Asia Investment Corp. Representative)	5,782	0.00
	Supervisor	H.Y. Kao (Asia Investment Corp. Representative)	5,782	0.00
ASIA INVESTMENT CORP.	Chairman	Peter Hsu(ACC Representative)	222,039,596	100.00
	Director	Doris Wu(ACC Representative)	222,039,596	100.00
	Director	H.T. Peng (ACC Representative)	222,039,596	100.00
	Director	H.Y. Kao(ACC Representative)	222,039,596	100.00
	Director	T.M. Chen(ACC Representative)	222,039,596	100.00
	Supervisor	Karen Yang (ACC Representative)	222,039,596	100.00
CHIAHUI POWER CORP.	Chairman	Douglas Tong Hsu (ACC Representative)	280,093,521	59.59
	President	C.L. Chen	0	0.00
	Director	Peter Hsu (ACC Representative)	280,093,521	59.59

-156-

Company Name	Title	Name or Representative	Shareholding	Shareholding
			Shares	%
	Director	K.Y. Lee (ACC Representative)	280,093,521	59.59
	Director	Michihide Kita (J-Power Investment Netherlands B.V. Representative)	187,854,807	39.97
	Director	Takashi Jahana (J-Power Investment Netherlands B.V. Representative)	187,854,807	39.97
	Independent Director	S.Y. Su	0	0.00
	Independent Director	M.Z. Jiang	0	0.00
	Supervisor	Doris Wu (Asia Investment Corp. Representative)	37,574	0.01
	Supervisor	W.H. Yeh (Asia Investment Corp. Representative)	37,574	0.01
FU DA TRANSPORTATION CO., LTD.	Chairman	Johnny Shih (Fu Ming Transportation Co., Ltd. Representative)	27,892,834	99.87
	Director / President	W.T. Hsu (Fu Ming Transportation Co., Ltd. Representative)	27,892,834	99.87
	Director	K.Y. Lee (Fu Ming Transportation Co., Ltd. Representative)	27,892,834	99.87
	Director	Y.F. Chang (Fu Ming Transportation Co., Ltd. Representative)	27,892,834	99.87
	Director	Y.X. Wu (Fu Ming Transportation Co., Ltd. Representative)	27,892,834	99.87
	Director	Humphrey Cheng (Fu Ming Transportation Co., Ltd. Representative)	27,892,834	99.87
	Supervisor	R.K. Tsai (Asia Investment Corp. Representative)	7,145	0.03
	Supervisor	C.M. Shi (Asia Investment Corp. Representative)	7,145	0.03
PERFECT INDUSTRIAL HOLDINGS PTE. LTD.	Director	Douglas TongHsu	0	0.00
	Director	Doris Wu	0	0.00
ORIENTAL CONCRETE PTE. LTD.	Chairman	Douglas Tong Hsu (Asia Cement (Singapore) Pte. Ltd. Representative)	17,000,000	100.00
	Director / Managing Director	J.H. Lin (Asia Cement (Singapore) Pte. Ltd. Representative)	17,000,000	100.00
	Director	Peter Hsu (Asia Cement (Singapore) Pte. Ltd. Representative)	17,000,000	100.00
	Director	K.Y. Lee (Asia Cement (Singapore) Pte. Ltd. Representative)	17,000,000	100.00
	Director	Gary Lee (Asia Cement (Singapore) Pte. Ltd. Representative)	17,000,000	100.00
FU SHAN MINERAL STONE CO., LTD.	Chairman	Y.F. Chang (Der Ching Investment Corp.Representative)	1,294,270	99.56
	Director / President	Z.P. Chang (Der Ching Investment Corp.Representative)	1,294,270	99.56
	Director	Peter Hsu (Der Ching Investment Corp.Representative)	1,294,270	99.56
	Director	C.M. Chen (Der Ching Investment Corp. Representative)	1,294,270	99.56

-157-

Company Name	Title	Name or Representative	Shareholding	Shareholding
			Shares	%
	Director	Manfred Wang (Der Ching Investment Corp. Representative)	1,294,270	99.56
	Supervisor	W.H. Yeh (Asia Investment Corp. Representative)	5,000	0.38
KOWLOON CEMENT CORP. LTD.	Chairman	Douglas Tong Hsu	0	0.00
	Director	Johnny Shih	0	0.00
	Director	K.Y. Lee	0	0.00
	Director	Y.F. Chang	0	0.00
	Director	R.H. Shao	0	0.00
	Director	Gary Lee	0	0.00
AC MEGA INVESTMENT LTD.	Director	C.M. Chen (Der Ching Investment Corp. Representative)	27,700,000	100.00
	Director	Doris Wu (Der Ching Investment Corp. Representative)	27,700,000	100.00
	Director	H.Y. Kao (Der Ching Investment Corp. Representative)	27,700,000	100.00
AC LEAP INVESTMENT LTD.	Director	C.M. Chen (Der Ching Investment Corp. Representative)	28,300,000	100.00
	Director	Doris Wu (Der Ching Investment Corp. Representative)	28,300,000	100.00
	Director	H.Y. Kao (Der Ching Investment Corp. Representative)	28,300,000	100.00
AC MEGA II INVESTMENT LTD.	Director	C.M. Chen (Der Ching Investment Corp. Representative)	10,000,000	100.00
	Director	Doris Wu (Der Ching Investment Corp. Representative)	10,000,000	100.00
	Director	H.Y. Kao Doris Wu (Der Ching Investment Corp. Representative)	10,000,000	100.00
AC MEGA III INVESTMENT LTD.	Director	C.M. Chen (Der Ching Investment Corp. Representative)	10,000,000	100.00
	Director	Doris Wu (Der Ching Investment Corp. Representative)	10,000,000	100.00
	Director	H.Y. Kao Doris Wu (Der Ching Investment Corp. Representative)	10,000,000	100.00
AC MEGA IV INVESTMENT LTD.	Director	C.M. Chen (Der Ching Investment Corp. Representative)	26,100,000	100.00
	Director	Doris Wu (Der Ching Investment Corp. Representative)	26,100,000	100.00
	Director	H.Y. Kao (Der Ching Investment Corp. Representative)	26,100,000	100.00
YA LI PRECAST CONCRETE INDIA PVT. LTD.	Chairman	X.M. He (Ya Li Precast And Prestressed Concrete Industries Corp. Representative)	*INR 1,599,990	99.99
	Director	W.H. Yeh (Ya Li Precast And Prestressed Concrete Industries Corp. Representative)	*INR 1,599,990	99.99
	Director	H.Y. Kao (Ya Li Precast And Prestressed Concrete Industries Corp. Representative)	*INR 1,599,990	99.99
	Director	Gary Lee (Ya Li Precast And Prestressed Concrete Industries Corp. Representative)	*INR 1,599,990	99.99

-158-

Company Name	Title	Name or Representative	Shareholding	Shareholding
			Shares	%
	Director	H.C. Lee (Ya Li Precast And Prestressed Concrete Industries Corp. Representative)	*INR 1,599,990	99.99
ASIA ORIENTAL (GUAM) L.L.C	Manager	C.P. Chen	0	0.00
PT YATUNG CONCRETE INTERNATIONAL	Chairman	C.P. Chen (Ya Tung Ready-Mixed Concrete Corp. Representative)	*USD 1,980	99.00
	Director	P.R. Chen (Ya Tung Ready-Mixed Concrete Corp. Representative)	*USD 1,980	99.00
	Director	Karen Yang (Ya Tung Ready-Mixed Concrete Corp. Representative)	*USD 1,980	99.00
	Supervisor	H.Y. Kao (Ya Li Precast And Prestressed Concrete Industries Corp. Representative)	*USD 20	1.00
YATUNG VIETNAM CO. LTD.	Manager	C.P. Chen	0	0.00
YA SING READY-MIXED CONCRETE CORP.	Chairman	C.P. Chen (Ya Tung Ready-Mixed Concrete Corp. Representative)	6,993,000	69.93
	Director / President	Z.G. He (Ya Tung Ready-Mixed Concrete Corp. Representative)	6,993,000	69.93
	Director	C.H. Chung (Ya Tung Ready-Mixed Concrete Corp. Representative)	6,993,000	69.93
	Director	P.R. Chen (Ya Tung Ready-Mixed Concrete Corp. Representative)	6,993,000	69.93
	Director	W.B. Lin (Ya Tung Ready-Mixed Concrete Corp. Representative)	6,993,000	69.93
	Director	W.S. Tsai (Ya Tung Ready-Mixed Concrete Corp. Representative)	6,993,000	69.93
	Director	J.F. Tsai (Nan Kung Enterprise Corp.Ltd. Representative)	1,000,000	10.00
	Director	J.B. Zhuo (Lien Fang Enterprise Corp.Ltd. Representative)	500,000	5.00
	Director	T.Y. Huang (Chu Chiang Enterprise Corp.Ltd. Representative)	1,000,000	10.00
	Supervisor	F.C. Wu (Ho Hwei Enterprise Corp.Ltd. Representative)	500,000	5.00
	Supervisor	W.K. Chou (Asia Investment Corp. Representative)	5,000	0.05

-159-

Company Name	Title	Name or Representative	Shareholding	Shareholding
			Shares	%
	Supervisor	H.Y. Kao (Asia Investment Corp. Representative)	5,000	0.05
ASIA CEMENT EXPLORER INVESTMENT LTD.	Director	C.M. Chen (Asia Investment Corp. Representative)	20,915,000	100.00
	Director	Doris Wu (Asia Investment Corp. Representative)	20,915,000	100.00
	Director	H.Y. Kao (Asia Investment Corp. Representative)	20,915,000	100.00
ASIA CEMENT PIONEER INVESTMENT LTD.	Director	C.M. Chen (Asia Investment Corp. Representative)	68,550,000	100.00
	Director	Doris Wu (Asia Investment Corp. Representative)	68,550,000	100.00
	Director	H.Y. Kao (Asia Investment Corp. Representative)	68,550,000	100.00
ASIA CEMENT PIONEER II INVESTMENT LTD.	Director	C.M. Chen (Asia Investment Corp. Representative)	28,000,000	100.00
	Director	Doris Wu (Asia Investment Corp. Representative)	28,000,000	100.00
	Director	H.Y. Kao (Asia Investment Corp. Representative)	28,000,000	100.00
ASIA CEMENT PIONEER III INVESTMENT LTD.	Director	C.M. Chen (Asia Investment Corp. Representative)	19,500,000	100.00
	Director	Doris Wu (Asia Investment Corp. Representative)	19,500,000	100.00
	Director	H.Y. Kao (Asia Investment Corp. Representative)	19,500,000	100.00
ASIA CEMENT PIONEER IV INVESTMENT LTD.	Director	C.M. Chen (Asia Investment Corp. Representative)	19,010,000	100.00
	Director	Doris Wu (Asia Investment Corp. Representative)	19,010,000	100.00
	Director	H.Y. Kao (Asia Investment Corp. Representative)	19,010,000	100.00
ASIA CONTINENT INVESTMENT HOLDINGS PTE. LTD.	Chairman	Douglas Tong Hsu	0	0.00
	Director	Peter Hsu	0	0.00
	Director	K.Y. Lee	0	0.00
	Director	Doris Wu	0	0.00
	Director	Soon Heng Leong	0	0.00
ORIENTAL INDUSTRIAL HOLDINGS PTE. LTD.	Chairman	Douglas Tong Hsu	4,000	0.00
	Director	Peter Hsu	0	0.00

-160-

Company Name	Title	Name or Representative	Shareholding	Shareholding
			Shares	%
	Director	R.H. Shao	1,000	0.00
	Director	Doris Wu	0	0.00
	Director	Soon Heng Leong	0	0.00
KOWLOON CONCRETE CORP. LTD.	Chairman	Douglas Tong Hsu	0	0.00
	Director	K.Y. Lee	0	0.00
	Director	L.H. Fang	0	0.00
	Director	Doris Wu	0	0.00
	Director	Gary Lee	0	0.00
JOIN FORTUNE TRADING LTD	Manager	Gary Lee	0	0.00
ASIA ORIENTAL CONCRETE,LLC	Manager	C.L. Lai	0	0.00
JIANGXI YADONG CEMENT CO., LTD.	Chairman	Z.L. Wu (Asia Continent Investment Holdings Pte. Ltd. Representative)	*USD 302,689	85.00
	President	J.B. Yu	*USD 0	0.00
	Director	H.He (Oriental Holdings Co., Ltd. Representative)	*USD 35,610	10.00
	Director	Ping Shen (Jiangxi Provincial Investment Group Corp. Representative)	*USD 17,805	5.00
	Supervisor	T.Z. Wu (Asia Continent Investment Holdings Pte. Ltd. Representative)	*USD 302,689	85.00
HUANGGANG YADONG CEMENT CO., LTD.	Chairman	L.H. Fang (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 77,553	90.00
	President	W.F. Hsu	0	0.00
	Director	L.M. Ou Yang (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 77,553	90.00
	Director	S.S. Wu (Oriental Holdings Co., Ltd. Representative)	*USD 8,617	10.00
	Supervisor	Michael Ting (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 77,553	90.00
WUHAN YADONG CEMENT CO., LTD.	Chairman	J.B. Yu (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 32,526	90.00
	President	J.F. Jiang	*USD 0	0.00
	Director	H.Q. Zhang (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 32,526	90.00
	Director	G Chen (Oriental Holdings Co., Ltd. Representative)	*USD 3,614	10.00
	Supervisor	W.Y. Liu (Oriental Industrial Holdings Pte. Ltd.Representative)	*USD 32,526	90.00

-161-

Company Name	Title	Name or Representative	Shareholding	Shareholding
			Shares	%
ORIENTAL HOLDINGS CO., LTD.	Chairman / President	Doris Wu (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 204,188	100.00
	Director	Dana Lee (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 204,188	100.00
	Director	Karen Yang (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 204,188	100.00
	Supervisor	J.H. Wu (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 204,188	100.00
CHENGDU YALI CEMENT PRODUCTS CO., LTD.	Chairman	L. Tian (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 2,100	51.22
	President	L.C. Lee	*USD 0	0.00
	Director	G.W. Ciou (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 2,100	51.22
	Director	L.J. Zeng (Oriental Holdings Co., Ltd. Representative)	*USD 2,000	48.78
	Supervisor	Y. Chen (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 2,100	51.22
SHANGHAI YALI CEMENT PRODUCTS CO., LTD.	Chairman	L.H. Fang (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 13,500	90.00
	President	H.He	*USD 0	0.00
	Director	Y.G. Zhang (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 13,500	90.00
	Director	X.W. Xiao (Oriental Holdings Co., Ltd. Representative)	*USD 1,500	10.00
	Supervisor	R.F. Huang (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 13,500	90.00

-162-

Company Name	Title	Name or Representative	Shareholding	Shareholding
			Shares	%
SICHUAN YALI CONCRETE PRODUCE CO., LTD.	Chairman	L. Tian (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 2,970	90.00
	President	L.C. Lee	*USD 0	0.00
	Director	Y.H. Lu (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 2,970	90.00
	Director	X.T. Kao (Oriental Holdings Co., Ltd. Representative)	*USD 330	10.00
	Supervisor	Q.P. Zhou (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 2,970	90.00
SICHUAN YALI TRANSPORT CO., LTD.	Chairman	L. Tian (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 3,150	90.00
	President	Y.H. Lu	*USD 0	0.00
	Director	G.C. Wang (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 3,150	90.00
	Director	C.H. Xiang (Oriental Holdings Co., Ltd. Representative)	*USD 350	10.00
	Supervisor	H.B. Feng (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 3,150	90.00
YANGZHOU YADONG CEMENT CO., LTD.	Chairman	L.H. Fang (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 31,977	90.00
	President	H.He	*USD 0	0.00
	Director	Y.T. Li (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 31,977	90.00
	Director	T.M. Jiang (Oriental Holdings Co., Ltd. Representative)	*USD 3,553	10.00
	Supervisor	J. Chen (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 31,977	90.00
SICHUAN YADONG CEMENT CO., LTD.	Chairman	L. Tian (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 331,506	90.00
	President	L.H. Fang	*USD 0	0.00
	Director	L.C. Lee (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 331,506	90.00
	Director	H.C Wang (Oriental Holdings Co., Ltd. Representative)	*USD 36,834	10.00

-163-

Company Name	Title	Name or Representative	Shareholding	Shareholding
			Shares	%
	Supervisor	J.X. Shen (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 331,506	90.00
HUBEI YADONG CEMENT CO., LTD.	Chairman	J.B. Yu (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 139,320	90.00
	President	L. Tian	*USD 0	0.00
	Director	L.C Guo (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 139,320	90.00
	Director	Z.Y Jing (Oriental Holdings Co., Ltd. Representative)	*USD 15,480	10.00
	Supervisor	N.B. Gan (Oriental Industrial Holdings Pte. Ltd. Representative)	*USD 139,320	90.00
NANCHANG YALI CONCRETE PRODUCE LTD.	Chairman	L.H. Fang (Jiangxi Yadong Cement Co., Ltd. Representative)	*RMB 60,000	100.00
	President	S.M. Chang	*RMB 0	0.00
	Director	Y.M. Dai (Jiangxi Yadong Cement Co., Ltd. Representative)	*RMB 60,000	100.00
	Director	J.X. Li (Jiangxi Yadong Cement Co., Ltd. Representative)	*RMB 60,000	100.00
	Supervisor	S.P. Hu (Jiangxi Yadong Cement Co., Ltd. Representative)	*RMB 60,000	100.00
JIANGXI YALI TRANSPORT CO., LTD.	Chairman	L.H. Fang (Jiangxi Yadong Cement Co., Ltd. Representative)	*RMB 6,499	51.99
	President	X.W. Xiao	*RMB 0	0.00
	Director	S.H Wang (Oriental Holdings Co., Ltd. Representative)	*RMB 6,000	48.00
	Director	D.L. Hsu (A.K. Fu Representative)	*RMB 1	0.01
	Supervisor	K.X. Li (Jiangxi Yadong Cement Co., Ltd. Representative)	*RMB 6,499	51.99
NANCHANG YADONG CEMENT CO., LTD.	Chairman	L.H. Fang (Jiangxi Yadong Cement Co., Ltd. Representative)	*RMB 45,000	50.00
	President	A.K. Fu	*RMB 0	0.00
	Director	Y.G. Yao (Oriental Holdings Co., Ltd. Representative)	*RMB 22,500	25.00

-164-

Company Name	Title	Name or Representative	Shareholding	Shareholding
			Shares	%
	Director	Y.S. Yao (Fangda Special Steel Technology Co., Ltd. Representative)	*RMB 22,500	25.00
	Supervisor	D.B. Wang (Jiangxi Yadong Cement Co., Ltd. Representative)	*RMB 45,000	50.00
WUHAN YALI CEMENT PRODUCTS CO., LTD.	Chairman	J.B. Yu (Wuhan Yadong Cement Co., Ltd. Representative)	*RMB 60,000	100.00
	President	X.L. Yu	*RMB 0	0.00
	Director	A.C. Hsu (Wuhan Yadong Cement Co., Ltd. Representative)	*RMB 60,000	100.00
	Director	G.F. He (Wuhan Yadong Cement Co., Ltd. Representative)	*RMB 60,000	100.00
	Supervisor	J.F. Jiang (Wuhan Yadong Cement Co., Ltd. Representative)	*RMB 60,000	100.00
TAIZHOU YADONG BUILDING MATERIAL CO., LTD.	Chairman	L.H. Fang (Oriental Holdings Co., Ltd. Representative)	*USD 16,000	100.00
	President	H.He	*USD 0	0.00
	Director	G.J. Shen (Oriental Holdings Co., Ltd. Representative)	*USD 16,000	100.00
	Director	D.M. Yi (Oriental Holdings Co., Ltd. Representative)	*USD 16,000	100.00
	Supervisor	M. Zhang (Oriental Holdings Co., Ltd. Representative)	*USD 16,000	100.00
Ruichang Yadong New Material Co., Ltd.	Chairman	L.H. Fang (Jiangxi Yadong Cement Co., Ltd. Representative)	*RMB 2,000	100.00
	President	J.B. Yu	*RMB 0	0.00
	Director	W.T. Chang (Jiangxi Yadong Cement Co., Ltd. Representative)	*RMB 2,000	100.00
	Director	W.Y. Wang (Jiangxi Yadong Cement Co., Ltd. Representative)	*RMB 2,000	100.00
	Supervisor	B. Dai (Jiangxi Yadong Cement Co., Ltd. Representative)	*RMB 2,000	100.00
SICHUAN LANFENG BUILDING MATERIALS CO., LTD.	Chairman	L. Tian (Sichuan Lanfeng Cement Co., Ltd. Representative)	*RMB 20,000	100.00
	President	X.M. Guo	*RMB 0	0.00

-165-

Company Name	Title	Name or Representative	Shareholding	Shareholding
			Shares	%
	Director	J.S. Lee (Sichuan Lanfeng Cement Co., Ltd. Representative)	*RMB 20,000	100.00
	Director	C. Liu (Sichuan Lanfeng Cement Co., Ltd. Representative)	*RMB 20,000	100.00
	Supervisor	Y.P. Xie (Sichuan Lanfeng Cement Co., Ltd. Representative)	*RMB 20,000	100.00
SICHUAN LANFENG CEMENT CO., LTD.	Chairman	L. Tian (Sichuan Yadong Cement Co., Ltd. Representative)	*RMB 600,000	100.00
	President	X.M. Guo	*RMB 0	0.00
	Director	J.S. Lee (Sichuan Yadong Cement Co., Ltd. Representative)	*RMB 600,000	100.00
	Director	C. Liu (Sichuan Yadong Cement Co., Ltd. Representative)	*RMB 600,000	100.00
	Supervisor	Y.P. Xie (Sichuan Yadong Cement Co., Ltd. Representative)	*RMB 600,000	100.00
HUBEI YALI TRANSPORT CO., LTD.	Chairman	J.B. Yu (Hubei Yadong Cement Co., Ltd. Representative)	*RMB 13,000	100.00
	President	H.Q. Zhang	*RMB 0	0.00
	Director	Z.H. Ye (Hubei Yadong Cement Co., Ltd. Representative)	*RMB 13,000	100.00
	Director	B.Y. Zhao (Hubei Yadong Cement Co., Ltd. Representative)	*RMB 13,000	100.00
	Supervisor	S.Y. Cheng (Hubei Yadong Cement Co., Ltd. Representative)	*RMB 13,000	100.00
WUHAN YAXIN CEMENT CO., LTD.	Chairman	J.B. Yu (Hubei Yadong Cement Co., Ltd. Representative)	*RMB 81,000	90.00
	President	W.Y. Liu	*RMB 0	0.00
	Director	X.L. Yu (Hubei Yadong Cement Co., Ltd. Representative)	*RMB 81,000	90.00
	Director	C.C. Cheng	*RMB 9,000	10.00
	Supervisor	C.H. He (Hubei Yadong Cement Co., Ltd. Representative)	*RMB 81,000	90.00

The above companies marked with the “” sign are not incorporated companies. Therefore the shareholding are shown in capital (Unit: INR, USD, VND and RMB $1,000) instead of shown in numbers of shares.

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8.5 Operating Condition of Affiliated Companies

8.5 Operating Condition of Affiliated Companies	8.5 Operating Condition of Affiliated Companies	8.5 Operating Condition of Affiliated Companies	8.5 Operating Condition of Affiliated Companies	8.5 Operating Condition of Affiliated Companies	8.5 Operating Condition of Affiliated Companies	8.5 Operating Condition of Affiliated Companies	8.5 Operating Condition of Affiliated Companies	8.5 Operating Condition of Affiliated Companies	8.5 Operating Condition of Affiliated Companies
Unit: NT$1,000 Book closure date: 31 December 2019
No.	Company Name	Capital	Total Assets	Total Liabilities	Net Value	Net Sales	Operating Income (Loss)	Income (Loss) After Income Tax	Earnings (Loss) per Share (After Income Tax)
1	FU MING TRANSPORTATION CO., LTD.	295,695	1,827,649	414,647	1,413,002	1,082,244	97,625	213,189	7.21
2	YUAN LONG STAINLESS STEEL CORP.	2,000,000	5,767,420	3,963,111	1,804,309	5,438,907	84,752	1,347	0.01
3	SUNRISE INDUSTRIAL HOLDINGS LTD.	2,909	131,287	76,365	54,922	0	(96)	3,038	33.75
4	NAN HWA CEMENT CORP.	261,440	746,513	484,983	261,530	375,711	20,873	52,531	2.01
5	ASIA ENGINEERING ENTERPRISE CORP.	81,144	350,356	164,798	185,558	71,586	10,410	59,946	7.39
6	ASIA CEMENT (CHINA) HOLDINGS CO.	634,911	92,909,406	31,640,052	61,269,354	0	(512,748)	14,106,889	9.08
7	ASIA CEMENT (SINGAPORE) PTE. LTD.	250,425	5,074,964	931,295	4,143,669	821,802	(35,512)	693,709	66.07
8	DER CHING INVESTMENT CORP.	5,956,218	20,198,633	6,541,067	13,657,566	333,742	330,583	1,262,905	2.12
9	YA LI TRANSPORTATION CORP.	100,000	497,048	17,883	479,165	179,498	(2,463)	22,796	2.28
10	YA LI PRECAST AND PRESTRESSED CONCRETE INDUSTRIES CORP.	193,776	329,681	239,484	90,197	176,332	7,110	1,040	0.05
11	YA TUNG READY-MIXED CONCRETE CORP.	1,590,750	5,130,833	3,329,063	1,801,770	9,072,752	312,414	146,801	0.92
12	ASIA INVESTMENT CORP.	2,220,396	10,232,880	6,976,681	3,256,199	289,257	288,423	977,016	4.40
13	CHIAHUI POWER CORP.	4,700,000	16,863,247	7,241,999	9,621,248	7,115,116	1,382,268	1,097,061	2.33
14	FU DA TRANSPORTATION CO., LTD.	279,279	1,262,659	521,049	741,610	881,218	87,835	109,850	3.93
15	PERFECT INDUSTRIAL HOLDINGS PTE. LTD.	290,905	74,365,545	0	74,365,545	0	(80)	15,638,825	1,609.01
16	ORIENTAL CONCRETE PTE. LTD.	377,230	261,152	908	260,244	12,440	4,947	3,400	0.20
17	FU SHAN MINERAL STONE CO.,LTD.	13,000	77,478	49,617	27,861	1,897	(6,357)	(6,936)	(5.34)
18	KOWLOON CEMENT CORP. LTD.	93,150	929,482	18,964	910,518	12,070	(4,748)	40,881	17.77
19	AC MEGA INVESTMENT LTD.	828,313	774,004	0	774,004	1,787	1,635	86,138	3.11
20	AC LEAP INVESTMENT LTD.	846,224	855,589	0	855,589	1,787	1,635	100,918	3.57
21	AC MEGA II INVESTMENT LTD.	289,050	281,337	0	281,337	0	(85)	46,877	4.69
22	AC MEGA III INVESTMENT LTD.	289,050	319,223	0	319,223	0	(85)	52,787	5.28

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No.	Company Name	Capital	Total Assets	Total Liabilities	Net Value	Net Sales	Operating Income (Loss)	Income (Loss) After Income Tax	Earnings (Loss) per Share (After Income Tax)
23	AC MEGA IV INVESTMENT LTD.	780,510	888,698	0	888,698	1,787	1,638	106,605	4.08
24	YA LI PRECAST CONCRETE INDIA PVT. LTD.	8,338	4,927	3,011	1,916	0	(219)	(219)	Note 1
25	ASIA ORIENTAL (GUAM) L.L.C	242,046	68,628	18	68,610	804	(893)	(43,552)	Note 1
26	PT YATUNG CONCRETE INTERNATIONAL CORP.	62,060	211,374	142,092	69,282	116,547	(46,897)	(72,481)	Note 1
27	YATUNG VIETNAM CO., LTD.	201,823	338,251	47,005	291,246	130,085	2,500	7,838	Note 1
28	YA SING READY-MIXED CONCRETE CORP.	100,000	269,305	143,912	125,393	720,312	42,125	27,530	2.75
29	ASIA CEMENT EXPLORER INVESTMENT LTD.	623,340	442,420	0	442,420	0	(89)	14,774	0.71
30	ASIA CEMENT PIONEER INVESTMENT LTD.	2,100,779	2,121,134	56,808	2,064,326	0	(89)	306,888	4.48
31	ASIA CEMENT PIONEER II INVESTMENT LTD.	833,410	891,935	0	891,935	0	(85)	101,257	3.62
32	ASIA CEMENT PIONEER III INVESTMENT LTD.	578,325	542,204	0	542,204	0	(85)	36,662	1.88
33	ASIA CEMENT PIONEER IV INVESTMENT LTD.	575,538	588,459	0	588,459	0	(85)	48,009	2.53
34	ASIA CONTINENT INVESTMENT HOLDINGS PTE. LTD.	8,645,188	21,926,906	93	21,926,813	0	(151)	5,472,063	16.50
35	ORIENTAL INDUSTRIAL HOLDINGS PTE. LTD.	25,073,666	52,420,077	142	52,419,935	0	(324)	9,991,482	14.26
36	KOWLOON CONCRETE CORP. LTD.	38	138,999	410	138,589	2,852	(663)	13,198	1,319.76
37	JOIN FORTUNE TRADING LTD.	88,372	36,282	17,325	18,957	0	(99)	584	0.20
38	ASIA ORINTAL CONCRETE,LLC	347,188	191,177	178,188	12,989	188,063	(62,093)	(66,247)	Note 1
39	JIANGXI YADONG CEMENT CO., LTD.	10,658,193	30,117,749	4,322,780	25,794,969	23,344,232	8,290,223	6,675,264	Note 1
40	HUANGGANG YADONG CEMENT CO., LTD.	2,579,068	6,046,607	593,413	5,453,194	3,754,736	1,476,295	1,191,577	Note 1
41	WUHAN YADONG CEMENT CO., LTD.	1,081,670	2,947,858	334,690	2,613,168	1,652,541	46,766	130,126	Note 1
42	ORIENTAL HOLDINGS CO., LTD.	3,903,082	12,389,715	8,250	12,381,465	0	(676)	1,730,872	Note 1
43	CHENGDU YA LI CEMENT PRODUCTS CO., LTD.	122,713	432,973	79,986	352,987	465,699	32,364	63,381	Note 1
44	SHANGHAI YALI CEMENT PRODUCTS CO., LTD.	448,950	262,643	200,640	62,003	37,712	(15,057)	63,986	Note 1
45	SICHUAN YALI CONCRETE PRODUCE CO., LTD.	98,769	837,133	606,879	230,254	1,323,776	135,524	79,571	Note 1

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No.	Company Name	Capital	Total Assets	Total Liabilities	Net Value	Net Sales	Operating Income (Loss)	Income (Loss) After Income Tax	Earnings (Loss) per Share (After Income Tax)
46	SICHUAN YALI TRANSPORT CO., LTD.	104,755	219,717	33,473	186,244	346,637	15,020	18,323	Note 1
47	YANGZHOU YADONG CEMENT CO., LTD.	1,063,413	2,250,627	357,114	1,893,513	4,078,292	357,732	226,061	Note 1
48	SICHUAN YADONG CEMENT CO., LTD.	11,024,416	24,155,190	1,667,157	22,488,033	9,998,218	3,728,794	5,671,266	Note 1
49	HUBEI YADONG CEMENT CO., LTD.	4,633,164	12,389,945	1,157,575	11,232,370	7,452,467	2,214,273	1,930,247	Note 1
50	RUICHANG YADONG NEW MATERIAL CO., LTD.	8,581	321,015	107,909	213,106	389,316	284,687	213,741	Note 1
51	NANCHANG YALI CONCRETE PRODUCE LTD.	257,419	827,186	122,826	704,360	756,225	57,858	(29,379)	Note 1
52	JIANGXI YALI TRANSPORT CO., LTD.	53,629	232,954	75,225	157,729	368,861	37,972	28,680	Note 1
53	NANCHANG YADONG CEMENT CO., LTD.	386,128	882,611	154,880	727,731	1,319,721	78,909	69,883	Note 1
54	WUHAN YALI CEMENT PRODUCTS CO., LTD.	257,419	548,026	160,476	387,550	843,423	101,453	103,702	Note 1
55	TAIZHOU YADONG BUILDING MATERIAL CO., LTD.	478,880	1,026,493	493,388	533,105	1,459,198	83,177	58,875	Note 1
56	SICHUAN LANFENG BUILDING MATERIALS CO., LTD.	85,806	54,416	143,879	(89,463)	0	(1,992)	(2,254)	Note 1
57	SICHUAN LANFENG CEMENT CO., LTD.	2,574,190	8,135,637	1,682,006	6,453,631	6,990,157	3,061,142	2,550,570	Note 1
58	HUBEI YALI TRANSPORT CO., LTD.	55,774	91,286	11,939	79,347	109,194	568	501	Note 1
59	WUHAN YAXIN CEMENT CORP. LTD.	386,128	1,870,672	251,454	1,619,218	1,783,301	232,266	202,157	Note 1

Note 1: The subsidiaries in China or overseas are limited liability companies; therefore it’s not able to count earnings per share.

Note 2: The data in Balance Sheet are converted according to the exchange rate at the end of 2019( USD：29.93；SGD：22.19；RMB：4.290316； HKD：3.819；INR：0.42；VND：0.001293；IDR：0.002153 ); the data in Income Statement are converted according to the 2019 average exchange rate ( USD ： 30.9119 ； SGD ： 22.6642 ； RMB ： 4.483617 ； HKD ： 3.9449 ； INR ： 0.4387 ； VND ： 0.00134 ； IDR ： 0.002188 ).

Consolidated Financial Reports: Please read section 6.4 for details.

◎ Relationship Report: Not applicable.

◎ Private placement: None.

◎ The shares held or disposed by subsidiaries in the most recent fiscal year and the current fiscal year up to the date of printing of the annual report : None.

In the most recent fiscal year and the current fiscal year up to the date of printing of the annual report, any event which has a material impact on shareholders' equity or securities prices: About the information of the Company's investment in China Shanshui Cement Group Ltd., please refer to the Note 7,18,24, 41 in consolidated financial report.
Any other matters listed in Article 36, paragraph 3, subparagraph 2 of the Securities and

Exchange Act which might materially affect shareholders' equity or the price of the company's securities, occurred during the most recent fiscal year or during the current fiscal year up to the date of printing of the annual report: None.

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Asia Cement Corporation and Subsidiaries

Consolidated Financial Statements for the Years Ended December 31, 2019 and 2018 and Independent Auditors’ Report

DECLARATION OF CONSOLIDATION OF FINANCIAL STATEMENTS OF AFFILIATES

The companies required to be included in the consolidated financial statements of affiliates in accordance with the “Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises” for the year ended December 31, 2019 are all the same as the companies required to be included in the consolidated financial statements of parent and subsidiary companies as provided in International Financial Reporting Standard 10 “Consolidated Financial Statements”. Relevant information that should be disclosed in the consolidated financial statements of affiliates has all been disclosed in the consolidated financial statements of parent and subsidiary companies. Hence, we did not prepare a separate set of consolidated financial statements of affiliates.

Very truly yours,

ASIA CEMENT CORPORATION

DOUGLAS TONG HSU Chairman March 25, 2020

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders Asia Cement Corporation

Opinion

Basis for Opinion

Key Audit Matters

The key audit matters identified in the Group’s consolidated financial statements for the year ended December 31, 2019 are stated as follows:

Estimated Impairment of Trade Receivables

The corresponding audit procedures that we performed for the estimated impairment of trade receivables are as follows:

We obtained an understanding of the internal control procedures with respect to management’s allowance for impairment loss of trade receivables.
We evaluated the reasonableness of allowance for impairment loss by testing the aging of trade receivables and by quantifying the potential risk of trade receivables that were overdue at the balance sheet date.
We tested the recoverability of the trade receivables by vouching cash receipts after the balance sheet date.
For the estimated impairment of accounts receivable, we evaluated the adequacy of management’s provision for impairment based on customers’ past default experience, current financial position, any collateral pledged, existing market conditions as well as forward looking estimates.

Fair Value Measurement of Investment Properties

The corresponding audit procedures that we performed for the fair value measurement of investment properties are as follows:

We assessed the professional competence and independence of the appraiser engaged by management and we obtained an understanding of the appraiser’s scope of work and process of engagement to confirm that no circumstances affect the appraiser’s independence and limit the scope of his work.
We obtained an understanding of and assessed the reasonableness of management’s assumptions and methods used in the valuation.
3 -
We sample-tested items from management’s supporting documents, which include the effective gross income, expenses, and property rights of land and buildings to verify the valuation process used by management and recalculated the fair value of investment properties to assess the reasonableness of management’s calculation.

Other Matter

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

Those charged with governance, including the audit committee, are responsible for overseeing the Group’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

Identify and assess the risks of material misstatement of the consolidated 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, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
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 Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated 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 Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision, and performance of the group audit. We remain solely responsible for our audit opinion.

The engagement partners on the audit resulting in this independent auditors’ report are Tai, Xin Wei and Fan, Yu Wei.

Deloitte & Touche Taipei, Taiwan Republic of China March 25, 2020

Notice to Readers

ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 6 and 37) Financial assets at fair value through profit or loss - current (Notes 7 and 36) Financial assets at fair value through other comprehensive income - current (Notes 8 and 38) Financial assets at amortized cost - current (Notes 6, 9, 36 and 38) Contract assets - current (Notes 31 and 37) Notes receivable Third parties Trade receivables Third parties (Notes 10 and 11) Related parties (Notes 10 and 37) Other receivables (Notes 12 and 37) Current tax assets (Note 33) Inventories (Note 13) Prepayments (Notes 21 and 37) Other current assets (Note 22) Total current assets NON-CURRENT ASSETS Investments accounted for using equity method (Notes 15, 37 and 38) Financial assets at fair value through other comprehensive income - non-current (Notes 8 and 38) Financial assets at amortized cost - non-current (Notes 6, 9, 37 and 38) Property, plant and equipment (Notes 16 and 38) Right-of-use assets (Notes 17 and 37) Investment properties (Notes 18 and 38) Intangible assets (Notes 19 and 20) Deferred tax assets (Note 33) Lease receivables - non-current (Note 11) Finance lease receivables - non-current (Note 11) Long-term prepayments for leases (Note 21) Other non-current assets (Notes 22 ,29 and 37) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Notes 23 and 37) Short-term bills payable (Note 24) Financial liabilities at fair value through profit or loss - current (Note 7) Contract liabilities - current (Notes 31 and 37) Accounts payable and accrued expenses Third parties (Note 20) Related parties (Note 37) Dividends and bonuses payable Other payables - others (Note 25) Current tax liabilities (Note 33) Provisions - current (Note 28) Lease liabilities - current (Note 17) Deferred revenue - current (Note 27) Current portion of long-term liabilities (Notes 26 and 37) Total current liabilities NON-CURRENT LIABILITIES Bonds payable (Note 26) Long-term borrowings (Notes 26 and 37) Provisions - non-current (Notes 22, 28 and 39) Lease liabilities - non-current (Note 17) Deferred tax liabilities (Note 33) Net defined benefit liabilities - non-current (Note 29) Deferred revenue - non-current (Note 27) Other non-current liabilities Total non-current liabilities Total liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE CORPORATION (Note 30) Share capital Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Total retained earnings Other equity Total equity attributable to owners of the Corporation NON-CONTROLLING INTERESTS (Note 30) Total equity TOTAL		2019 Amount % $ 24,735,495 8 4,728,223 2 3,978,366 1 23,016,985 8 68,412 - 11,159,687 4 10,159,263 3 803,340 - 481,800 - 6,785 - 7,789,794 3 1,812,789 1 501,127 - 89,242,066 30 84,412,240 28 11,692,138 4 36,064 - 50,681,281 17 5,080,287 2 36,176,439 12 7,000,317 2 474,929 - - - 8,170,867 3 - - 4,311,884 2 208,036,446 70 $ 297,278,512 100 $ 23,811,603 8 18,932,294 6 112,070 - 987,496 - 13,266,966 5 256,803 - 230,151 - 312,069 - 2,957,672 1 50,661 - 190,607 - 75,912 - 13,151,315 5 74,335,619 25 19,280,807 7 20,820,990 7 715,432 - 1,264,765 1 9,991,422 3 164,208 - 847,893 - 408,338 - 53,493,855 18 127,829,474 43 33,614,472 11 1,456,054 - 16,727,089 6 64,463,426 22 27,373,840 9 108,564,355 37 2,432,477 1 146,067,358 49 23,381,680 8 169,449,038 57 $ 297,278,512 100		2018
				Amount % $ 14,929,411 5 9,046,583 3 3,800,923 2 14,322,874 5 147,528 - 12,928,203 5 9,251,854 3 976,266 - 2,964,751 1 15,901 - 9,804,276 4 1,684,612 1 485,324 - 80,358,506 29 78,846,276 28 9,784,743 4 14,642 - 52,549,341 19 - - 35,965,203 13 3,694,783 1 436,238 - 8,894,355 3 - - 3,779,353 1 4,864,558 2 198,829,492 71 $ 279,187,998 100 $ 24,805,239 9 18,564,469 7 268,218 - 731,015 - 8,028,077 3 250,857 - 231,722 - 334,305 - 2,181,268 1 48,200 - - - 75,912 - 7,285,012 2 62,804,294 22 12,192,567 5 33,593,896 12 679,377 - - - 9,365,429 4 185,107 - 923,805 - 395,177 - 57,335,358 21 120,139,652 43 33,614,472 12 1,362,554 - 15,615,380 6 63,945,145 23 20,358,461 7 99,918,986 36 2,996,214 1 137,892,226 49 21,156,120 8 159,048,346 57 $ 279,187,998 100

The accompanying notes are an integral part of the consolidated financial statements.

(With Deloitte & Touche auditors’ report dated March 25, 2020)

ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OPERATING REVENUE (Notes 31 and 37) OPERATING COSTS (Notes 13, 31 and 37) GROSS PROFIT UNREALIZED GAIN ON TRANSACTIONS WITH ASSOCIATES REALIZED GAIN ON TRANSACTIONS WITH ASSOCIATES REALIZED GROSS PROFIT OPERATING EXPENSES Administrative expenses (Notes 32 and 37) Expected credit loss (Note 10) Total operating expenses OPERATING INCOME NON-OPERATING INCOME AND EXPENSES Other income (Note 32) Other gains and losses (Note 32) Finance costs (Note 32) Share of profit of associates and joint ventures Total non-operating income and expenses PROFIT BEFORE INCOME TAX INCOME TAX EXPENSE (Note 33) NET INCOME FOR THE YEAR		2019 Amount % $ 89,347,637 100 63,746,928 71 25,600,709 29 14,392 - - - 25,586,317 29 3,332,110 4 191,031 - 3,523,141 4 22,063,176 25 1,998,600 2 661,654 1 (1,820,623) (2) 5,490,375 6 6,330,006 7 28,393,182 32 6,149,229 7 22,243,953 25		2018
				Amount % $ 82,741,004 100 61,584,690 74 21,156,314 26 - - 15,147 - 21,171,461 26 2,875,798 4 142,553 - 3,018,351 4 18,153,110 22 1,479,803 2 (1,733,766) (2) (1,673,185) (2) 4,144,156 5 2,217,008 3 20,370,118 25 5,480,921 7 14,889,197 18 (Continued)

ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OTHER COMPREHENSIVE INCOME, NET Items that will not be reclassified subsequently to profit or loss: Unrealized gain on investments in equity instruments at fair value through other comprehensive income Remeasurement of defined benefit plans Share of other comprehensive income of associates and joint ventures Items that may be reclassified subsequently to profit or loss: Exchange differences on translating the financial statements of foreign operations Cash flow hedges Share of other comprehensive (loss) income of associates and joint ventures Other comprehensive (loss) income for the year, net of income tax TOTAL COMPREHENSIVE INCOME FOR THE YEAR NET PROFIT ATTRIBUTABLE TO: Owners of the Corporation Non-controlling interests TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO: Owners of the Corporation Non-controlling interests EARNINGS PER SHARE (Note 34) Basic Diluted		2019 Amount % $ 1,193,292 1 486,711 1 1,778,252 2 3,458,255 4 (2,635,629) (3) - - (1,439,930) (2) (4,075,559) (5) (617,304) (1) $ 21,626,649 24 $ 17,459,673 20 4,784,280 5 $ 22,243,953 25 $ 17,652,536 20 3,974,113 4 $ 21,626,649 24 $ 5.56 $ 5.25		2018
				Amount % $ 707,605 1 265,511 - 723,519 1 1,696,635 2 (894,761) (1) (2,434) - 636,733 1 (260,462) - 1,436,173 2 $ 16,325,370 20 $ 11,117,094 13 3,772,103 5 $ 14,889,197 18 $ 12,811,353 16 3,514,017 4 $ 16,325,370 20 $ 3.54 $ 3.49

The accompanying notes are an integral part of the consolidated financial statements.

(With Deloitte & Touche auditors’ report dated March 25, 2020)

(Concluded)

ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

		Equity Attributable to O	rs of the Corporation
Share Capital	Issued Amount Capital Surplus $ 33,614,472 $ 1,168,692 - - - - - - - 185,411 - 8,451 - - - - - - - - - - 33,614,472 1,362,554 - - 33,614,472 1,362,554 - - - - - - - 93,500 - - - - - - - - - - $ 33,614,472 $ 1,456,054	Retained Earnings Unappropriated Legal Reserve Special Reserve Earnings $ 15,068,480 $ 63,001,957 $ 17,839,296 546,900 - (546,900 ) - 943,188 (943,188 ) - - (4,033,736 ) - - - - - - - - 11,117,094 - - 351,764 - - - - - (3,408,697 ) - - (17,172) 15,615,380 63,945,145 20,358,461 - - (143,100) 15,615,380 63,945,145 20,215,361 1,111,709 - (1,111,709 ) - 518,281 (518,281 ) - - (9,412,052 ) - - - - - 17,459,673 - - 676,889 - - - - - 79,711 - - (15,752) $ 16,727,089 $ 64,463,426 $ 27,373,840		Other Equity		Total Other Equity $ (1,754,978 ) - - - - - - 1,342,495 - 3,408,697 - 2,996,214 - 2,996,214 - - - - - (484,026 ) - (79,711 ) - $ 2,432,477
			Exchange Differences on Unrealized Gain (Loss) on Translating the Financial Financial Assets at Fair Value Statements of Through Other Foreign Comprehensive Operations Income $ (2,638,153 ) $ 516,962 - - - - - - - - - - - - (3,211 ) 1,343,257 - - - 3,408,697 - - (2,641,364 ) 5,268,916 - - (2,641,364 ) 5,268,916 - - - - - - - - - - (3,271,837 ) 2,719,118 - - - (79,711 ) - - $ (5,913,201) $ 7,908,323	Gains on Property Revaluation $ 307,728 - - - - - - - - - - 307,728 - 307,728 - - - - - 77,486 - - - $ 385,214	Cash Flow Hedges $ 58,485 - - - - - - 2,449 - - - 60,934 - 60,934 - - - - - (8,793 ) - - - $ 52,141

Shares 3,361,447 - - - - - - - - - - 3,361,447 - 3,361,447 - - - - - - - - - 3,361,447

The accompanying notes are an integral part of the consolidated financial statements.

(With Deloitte & Touche auditors’ report dated March 25, 2020)

10 -

ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments for: Share of loss of associates and joint ventures Depreciation expenses Finance costs Amortization expenses Net (gain) loss on fair value changes of financial assets and liabilities designated as at fair value through profit or loss Interest income Dividend income Gain on disposal of financial assets Unrealized gain on foreign exchange Gain on changes in fair value of investment properties Expected credit loss recognized on trade receivables (Reversal of) write-downs of inventories Loss on disposal of property, plant and equipment Loss on disposal of investments accounted for using equity method Impairment loss recognized on investments accounted for using equity method Impairment loss recognized on goodwill Impairment loss on property, plant and equipment Gain on disposal of subsidiaries Effect of changes in exchange rate of bonds payable Other items Changes in operating assets and liabilities Financial assets mandatorily classified as at fair value through profit or loss Contract assets Notes receivable Trade receivables Other receivables Inventories Prepayments Other current assets Contract liabilities Accounts payable and accrued expenses Provisions Net defined benefit liabilities Deferred revenue Cash generated from operations Interests received Dividends received	2019 $ 28,393,182 (5,490,375) 4,827,418 1,820,623 1,292,725 (1,129,040) (1,126,001) (761,309) (365,192) (295,492) (197,647) 191,031 (18,619) 44,225 5,761 - - - - - - 5,660,259 79,116 1,351,524 273,510 1,769,088 1,857,463 (408,758) (34,246) 256,481 697,124 35,916 (5,682) (75,912) 38,647,173 1,161,528 4,062,869	2018 $ 20,370,118 (4,144,156) 4,649,561 1,673,185 269,631 256,294 (370,571) (770,314) (251,859) (15,575) (98,015) 142,553 315,353 33,455 - 200,245 630,631 51,888 (40,440) 300 (755) (3,051,110) (44,533) (4,805,502) 525,258 (487,332) (3,566,055) (31,307) (74,718) (20,934) 806,044 176,021 (12,254) (68,085) 12,247,022 254,393 3,172,662 (Continued)

11 -

ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

Interests paid Income tax paid Net cash generated from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Purchase of financial assets at amortized cost Payments for property, plant and equipment Acquisition of associates Decrease (increase) in refundable deposits Purchase of financial assets at fair value through other comprehensive income Increase in long-term prepayments for investment Net cash inflow on disposal of associates Payments for intangible assets Proceeds from disposal of property, plant and equipment Payments for investment properties Decrease in other non-current assets Net cash inflow on disposal of subsidiaries Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Repayments of long-term borrowings Proceeds from long-term borrowings Proceeds from issuance of bonds Dividends paid Repayments of bonds Dividends paid to non-controlling interests (Decrease) increase in short-term borrowings Increase in short-term bills payable Repayment of the principal portion of lease liabilities Increase (decrease) in other non-current liabilities (Decrease) increase in guarantee deposits received Net cash (used in) generated from financing activities EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE OF CASH AND CASH EQUIVALENTS HELD IN FOREIGN CURRENCIES	2019 $ (1,803,500) (4,796,169) 37,271,901 (8,715,533) (3,754,851) (3,326,114) 596,780 (275,281) (11,224) 63,008 (58,941) 37,708 (27,224) 5,300 - (15,466,372) (92,064,122) 86,653,202 10,000,000 (9,412,164) (4,000,000) (1,748,520) (704,248) 369,075 (267,792) 21,680 (10,073) (11,162,962) (836,483)	2018 $ (1,658,691) (3,304,318) 10,711,068 (9,537,968) (4,274,600) (123,120) (9,678) (556,016) (83,721) - (13,037) 90,395 (1,269) 1,559 48,391 (14,459,064) (30,396,615) 34,819,996 6,574,843 (4,033,715) (4,089,430) (723,504) 6,445,333 2,439,125 - (59,096) 14,691 10,991,628 (53,713) (Continued)

12 -

ASIA CEMENT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

2019 NET INCREASE IN CASH AND CASH EQUIVALENTS $ 9,806,084 CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR 14,929,411 CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR $ 24,735,495 The accompanying notes are an integral part of the consolidated financial statements. (With Deloitte & Touche auditors’ report dated March 25, 2020)	2018 $ 7,189,919 7,739,492 $ 14,929,411 (Concluded)

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

ASIA CEMENT CORPORATION AND SUBSIDIARIES

1. ORGANIZATION AND OPERATIONS

Asia Cement Corporation (the “Corporation”) was incorporated in March 1957. It manufactures and sells cement, clinker, cement-related products and ready-mixed concrete, and engages in leasing activities. The Corporation is also required to undertake reforestation activities in designated areas. The Corporation’s shares have been listed on the Taiwan Stock Exchange since June 1962.

In June 1992 and September 1996, certain shares of the Corporation were sold by Far Eastern New Century Corporation (FENC) in the form of global depositary shares (GDSs). Such GDSs have been quoted through the SEAQ system of the London Stock Exchange and traded through the portal system of the National Association of Securities Dealers, Inc. As of December 31, 2019, the issued and outstanding GDSs aggregated 17,049 units, representing 170,487 shares of the Corporation.

The consolidated financial statements are presented in the Corporation’s functional currency, New Taiwan dollar.

2. APPROVAL OF FINANCIAL STATEMENTS

The consolidated financial statements were approved by the Corporation’s board of directors and authorized for issue on March 25, 2020.

3. APPLICATION OF NEW, AMENDED AND REVISED STANDARDS AND INTERPRETATIONS

a. Initial application of the amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) (collectively, the “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC)

Except for the following, the initial application of the amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the IFRSs endorsed and issued into effect by the FSC did not have any material impact on the Group’s accounting policies:

IFRS 16 “Leases”

IFRS 16 provides a comprehensive model for the identification of lease arrangements and their treatment in the financial statements of both lessee and lessor. It supersedes IAS 17 “Leases”, IFRIC 4 “Determining whether an Arrangement contains a Lease”, and a number of related interpretations. Refer to Note 4 for information relating to the relevant accounting policies.

Definition of a lease

The Group elects to apply the guidance of IFRS 16 in determining whether contracts are, or contain, a lease only to contracts entered into (or changed) on or after January 1, 2019. Contracts identified as containing a lease under IAS 17 and IFRIC 4 are not reassessed and are accounted for in accordance with the transitional provisions under IFRS 16.

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The Group as lessee

The Group recognizes right-of-use assets and lease liabilities for all leases on the consolidated balance sheets except for those whose payments under low-value asset and short-term leases are recognized as expenses on a straight-line basis. On the consolidated statements of comprehensive income, the Group presents the depreciation expense charged on right-of-use assets separately from the interest expense accrued on lease liabilities; interest is computed using the effective interest method. On the consolidated statements of cash flows, cash payments for the principal portion of lease liabilities are classified within financing activities; cash payments for the interest portion are classified within operating activities. Prior to the application of IFRS 16, payments under operating lease contracts were recognized as expenses on a straight-line basis. Prepaid lease payments for land use rights of land located in mainland China, Hong Kong, Singapore and Vietnam are recognized as prepayments for leases. Cash flows for operating leases were classified within operating activities on the consolidated statements of cash flows.

The Group elects to apply IFRS 16 retrospectively with the cumulative effect of the initial application of this standard recognized in retained earnings on January 1, 2019. Comparative information is not restated.

Lease liabilities were recognized on January 1, 2019 for leases previously classified as operating leases under IAS 17. Lease liabilities were measured at the present value of the remaining lease payments, discounted using the lessee’s incremental borrowing rate on January 1, 2019. Right-of-use assets are measured at an amount equal to the lease liabilities, adjusted by the amount of any prepaid or accrued lease payments. The Group applies IAS 36 to all right-of-use assets.

The Group also applies the following practical expedients:

1) The Group applies a single discount rate to a portfolio of leases with reasonably similar characteristics to measure lease liabilities.
2) The Group accounts for those leases for which the lease term ends on or before December 31, 2019 as short-term leases.
3) The Group uses hindsight, such as in determining lease terms, to measure lease liabilities.

For leases previously classified as finance leases under IAS 17, the carrying amounts of right-of-use assets and lease liabilities on January 1, 2019 are determined as at the carrying amounts of the respective leased assets and finance lease payables on December 31, 2018.

The lessee’s incremental borrowing rate applied to lease liabilities recognized on January 1, 2019 is 1.06%-3.79%. The difference between the lease liabilities recognized and operating lease commitments disclosed under IAS 17 on December 31, 2018 is explained as follows:

The future minimum lease payments of non-cancellable operating lease commitments on December 31, 2018 Less: Recognition exemption for short-term leases and low-value assets leases Less: Adjustments relating to changes in the index or rate affecting variable payments Undiscounted amounts on January 1, 2019 Lease liabilities recognized on January 1, 2019	$ 3,765,752 (217,813) (1,786,274) $ 1,761,665 $ 1,260,607

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The Group as lessor

The Group does not make any adjustments for leases in which it is a lessor, and it accounts for those leases with the application of IFRS 16 starting from January 1, 2019.

The impact on assets, liabilities and equity as of January 1, 2019 from the initial application of IFRS 16 is set out as follows:

As Originally
Stated on
January 1, 2019
Lease receivables - current
$ 672,230
Lease receivables - non-current

8,894,355
Finance lease receivables - current

-
Finance lease receivables - non-current

-
Prepayments

1,684,612
Prepayments for leases - non-current

3,779,353
Right-of-use assets

-
Investments accounted for using equity
method

78,846,276

Total effect on assets
$ 93,876,826

Lease liabilities - current
$ -
Lease liabilities - non-current

-

Total effect on liabilities
$ -

Retained earnings
$ 99,918,986
Non-controlling interests

21,156,120

Total effect on equity
$ 121,075,106

Adjustments
Arising from
Initial
Application
Restated on
January 1, 2019
$ (672,230) $ -

(8,894,355)
-

672,230
672,230

8,894,355
8,894,355

(126,825)
1,557,787

(3,779,353)
-

5,166,785
5,166,785

(143,104)

78,703,172
$ 1,117,503
$ 94,994,329
$ 199,578 $ 199,578

1,061,029

1,061,029
$ 1,260,607
$ 1,260,607
$ (143,100) $ 99,775,886

(4)

21,156,116
$ (143,104)
$ 120,932,002

b. The IFRSs endorsed by the FSC for application starting from 2020

Effective Date New IFRSs Announced by IASB Amendments to IFRS 3 “Definition of a Business” January 1, 2020 (Note 1) Amendments to IFRS 9, IAS 39 and IFRS 7 “Interest Rate Benchmark January 1, 2020 (Note 2) Reform” Amendments to IAS 1 and IAS 8 “Definition of Material” January 1, 2020 (Note 3)

Note 1: The Group shall apply these amendments to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after January 1, 2020 and to asset acquisitions that occur on or after the beginning of that period.
Note 2: The Group shall apply these amendments retrospectively for annual reporting periods beginning on or after January 1, 2020.
Note 3: The Group shall apply these amendments prospectively for annual reporting periods beginning on or after January 1, 2020.
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As of the date the consolidated financial statements were authorized for issue, the Group is continuously assessing the possible impact that the application of the above standards and interpretations will have on the Group’s financial position and financial performance and will disclose the relevant impact when the assessment is completed.

c. New IFRSs in issue but not yet endorsed and issued into effect by the FSC

New IFRSs Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and its Associate or Joint Venture” IFRS 17 “Insurance Contracts” Amendments to IAS 1 “Classification of Liabilities as Current or Non-current”	Effective Date Announced by IASB (Note)
	To be determined by IASB January 1, 2021 January 1, 2022

Note: Unless stated otherwise, the above New IFRSs are effective for annual reporting periods beginning on or after their respective effective dates.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a. Statement of compliance

The consolidated financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and IFRSs as endorsed and issued into effect by the FSC.

b. Basis of preparation

The consolidated financial statements have been prepared on the historical cost basis except for financial instruments, investment properties which are measured at fair value, and net defined benefit assets (liabilities) which are measured at the present value of the defined benefit obligation less the fair value of plan assets.

The fair value measurements, which are grouped into Levels 1 to 3 based on the degree to which the fair value measurement inputs are observable and based on the significance of the inputs to the fair value measurement in its entirety, are described as follows:

1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;
2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for an asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and
3) Level 3 inputs are unobservable inputs for an asset or liability.
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Classification of Current and Non-current Assets and Liabilities

Current assets include:

a. Assets held primarily for the purpose of trading;
b. Assets expected to be realized within 12 months after the reporting period; and
c. Cash and cash equivalents unless the asset is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period.

Current liabilities include:

a. Liabilities held primarily for the purpose of trading;
b. Liabilities due to be settled within 12 months after the reporting period, even if an agreement to refinance, or to reschedule payments, on a long-term basis is completed after the reporting period and before the consolidated financial statements are authorized for issue; and
c. Liabilities for which the Group does not have an unconditional right to defer settlement for at least 12 months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

Assets and liabilities that are not classified as current are classified as non-current.

Ya Li Precast and Prestressed Concrete Industries Corp., Asia Engineering Enterprise Corp. and Ya Li Precast Concrete India Pvt. Ltd. engage in construction related businesses, which have operating cycles of over one year. The assets and liabilities of the aforementioned companies related to the construction contracts are classified as current or non-current according to the length of their operating cycles.

Basis of Consolidation

Principles for preparing consolidated financial statements

The consolidated financial statements incorporate the financial statements of the Corporation and the entities controlled by the Corporation (i.e., its subsidiaries).

Income and expenses of subsidiaries acquired or disposed of during the period are included in the consolidated statement of profit or loss and other comprehensive income from the effective dates of acquisitions up to the effective dates of disposals, as appropriate.

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

All intra-group transactions, balances, income and expenses are eliminated in full upon consolidation.

Total comprehensive income of subsidiaries is attributed to the owners of the Corporation and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

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

18 -

Refer to Note 14, Tables 7 and 8 for detailed information on subsidiaries (including percentages of ownership and main businesses).

Foreign Currencies

In preparing the financial statements of each individual entity, transactions in currencies other than the entity’s functional currency (i.e., foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions.

At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Exchange differences on monetary items arising from settlement or translation are recognized in profit or loss in the period in which they arise.

Non-monetary items measured at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Exchange differences arising from the retranslation of non-monetary items are included in profit or loss for the period except for exchange differences arising from the retranslation of non-monetary items in respect of which gains and losses are recognized directly in other comprehensive income, in which cases, the exchange differences are also recognized directly in other comprehensive income.

Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.

For the purpose of presenting consolidated financial statements, the functional currencies of the Group (including subsidiaries, associates, joint ventures and branches in other countries that use currencies which are different from the currency of the Corporation) are translated into the presentation currency, the New Taiwan dollar, as follows: Assets and liabilities are translated at the exchange rates prevailing at the end of the reporting period; and income and expense items are translated at the average exchange rates for the period. The resulting currency translation differences are recognized in other comprehensive income (attributed to the owners of the Corporation and non-controlling interests as appropriate).

On the disposal of a foreign operation, all of the exchange differences accumulated in equity in respect of that operation attributable to the owners of the Corporation are reclassified to profit or loss.

Inventories

Inventories consist of raw materials, supplies, finished goods and work-in-process and are stated at the lower of cost or net realizable value. Inventory write-downs are made by item, except where it may be appropriate to group similar or related items. The net realizable value is the estimated selling price of inventories less all estimated costs of completion and costs necessary to make the sale. Inventories are recorded at the weighted-average cost on the balance sheet date.

Investments in Associates and Joint Ventures

An associate is an entity over which the Group has significant influence and which is neither a subsidiary nor an interest in a joint venture. A joint venture is a joint arrangement whereby the Group and other parties that have joint control of the arrangement have rights to the net assets of the arrangement.

The Group uses the equity method to account for its investments in associates and joint ventures.

Under the equity method, investments in an associate and a joint venture are initially recognized at cost and adjusted thereafter to recognize the Group’s share of profit or loss and other comprehensive income of the associate and joint venture. The Group also recognizes the changes in the Group’s share of equity of associates and joint ventures attributable to the Group.

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Any excess of the cost of acquisition over the Group’s share of net fair value of the identifiable assets and liabilities of an associate or a joint venture at the date of acquisition is recognized as goodwill, which is included within the carrying amount of the investment and is not amortized. Any excess of the Group’s share of net fair value of the identifiable assets and liabilities over the cost of acquisition, after reassessment, is recognized immediately in profit or loss.

If the measurement of the fair values of the identifiable net assets and liabilities of an associate acquired in stage is incomplete by the end of the reporting period, the Group reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted retrospectively during the measurement period. Measurement period adjustments are adjustments that arise from additional information obtained during the measurement period about facts and circumstances that existed as of the acquisition date. The measurement period does not exceed 1 year from the acquisition date.

When the Group subscribes for additional new shares of an associate and joint venture at a percentage different from its existing ownership percentage, the resulting carrying amount of the investment differs from the amount of the Group’s proportionate interest in the associate and joint venture. The Group records such a difference as an adjustment to investments with the corresponding amount charged or credited to capital surplus - changes in capital surplus from investments in associates and joint ventures accounted for using equity method. If the Group’s ownership interest is reduced due to its additional subscription of the new shares of the associate and joint venture, the proportionate amount of the gains or losses previously recognized in other comprehensive income in relation to that associate and joint venture is reclassified to profit or loss on the same basis as would be required if the investee had directly disposed of the related assets or liabilities. When the adjustment should be debited to capital surplus, but the capital surplus recognized from investments accounted for using equity method is insufficient, the shortage is debited to retained earnings.

The entire carrying amount of an investment (including goodwill) is tested for impairment as a single asset by comparing its recoverable amount with its carrying amount. Any impairment loss recognized is deducted from the carrying amount of the investment. Any reversal of that impairment loss is recognized to the extent that the recoverable amount of the investment subsequently increases.

The Group discontinues the use of the equity method from the date on which its investment ceases to be an associate and a joint venture. Any retained investment is measured at fair value at that date, and the fair value is regarded as the investment’s fair value on initial recognition as a financial asset. The difference between the previous carrying amount of the associate and joint venture attributable to the retained interest and its fair value is included in the determination of the gain or loss on disposal of the associate and the joint venture. The Group accounts for all amounts previously recognized in other comprehensive income in relation to that associate and joint venture on the same basis as would be required if that associate had directly disposed of the related assets or liabilities. If an investment in an associate becomes an investment in a joint venture or an investment in a joint venture becomes an investment in an associate, the Group continues to apply the equity method and does not remeasure the retained interest.

When the Group transacts with its associate and joint venture, profits and losses resulting from the transactions with the associate and joint venture are recognized in the Group’s consolidated financial statements only to the extent of unrelated parties’ interests in the associate and joint venture.

The Group’s share of comprehensive income of associates or joint ventures is recognized using the treasury share method if there are reciprocal holdings between investors and investees. The reciprocally held shares of the Group are treated as treasury shares and are deducted from the outstanding shares in computing basic earnings per share.

20 -

Property, Plant and Equipment

Property, plant and equipment are stated at cost, less accumulated depreciation and accumulated impairment loss. Major renewals and betterments are capitalized, while maintenance and repairs are expensed currently. Properties in the course of construction are depreciated and classified to the appropriate categories of property, plant and equipment when completed and ready for intended use.

Depreciation is recognized using the fixed-percentage-on-declining-balance method or the straight-line method. Each significant part is depreciated separately. The estimated useful lives, residual values and depreciation methods are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis.

On derecognition of an item of property, plant and equipment, the difference between the sales proceeds and the carrying amount of the asset is recognized in profit or loss.

Investment Properties

Investment properties are properties held to earn rentals and/or for capital appreciation. Investment properties also include land held for a currently undetermined future use.

Freehold investment properties are initially measured at cost, including transaction costs, and are subsequently measured using the fair value model. Changes in the fair value of investment properties are included in profit or loss for the period in which they arise.

For a transfer from property, plant and equipment to investment property at the end of owner-occupation, any difference between the fair value and the carrying amount of the property at the date of transfer is recognized in other comprehensive income.

On derecognition of an investment property, the difference between the net disposal proceeds and the carrying amount of the asset is included in profit or loss.

Goodwill

Goodwill arising from the acquisition of a business is measured at cost as established at the date of acquisition of the business less accumulated impairment loss.

For the purposes of impairment testing, goodwill is allocated to each of the Group’s cash-generating units or groups of cash-generating units (referred to as “cash-generating units”) that is expected to benefit from the synergies of the combination.

A cash-generating unit to which goodwill has been allocated is tested for impairment annually or more frequently when there is an indication that the unit may be impaired, by comparing its carrying amount, including the attributed goodwill, with its recoverable amount. However, if the goodwill allocated to a cash-generating unit was acquired in a business combination during the current annual period, that unit is tested for impairment before the end of the current annual period. If the recoverable amount of the cash-generating unit is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then pro rata to the other assets of the unit based on the carrying amount of each asset in the unit. Any impairment loss is recognized directly in profit or loss. Any impairment loss recognized for goodwill is not reversed in subsequent periods.

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Intangible Assets

Intangible assets with finite useful lives that are acquired separately are initially measured at cost and subsequently measured at cost less accumulated amortization and accumulated impairment loss. Amortization is recognized on a straight-line basis. The estimated useful life, residual value, and amortization method are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis.

Intangible assets acquired in a business combination and recognized separately from goodwill are initially recognized at their fair value at the acquisition date (which is regarded as their cost). Subsequent to initial recognition, they are measured on the same basis as intangible assets that are acquired separately.

On derecognition of an intangible asset, the difference between the net disposal proceeds and the carrying amount of the asset is recognized in profit or loss.

Impairment of Tangible and Intangible Assets Other than Goodwill

At the end of each reporting period, the Group reviews the carrying amounts of its tangible and intangible assets, excluding goodwill, to determine whether there is any indication that those assets have suffered any impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. When it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. Corporate assets are allocated to the smallest group of cash-generating units on a reasonable and consistent basis of allocation.

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

The recoverable amount is the higher of fair value less costs to sell and value in use. If the recoverable amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying amount of the asset or cash-generating unit is reduced to its recoverable amount, with the resulting impairment loss recognized in profit or loss.

When an impairment loss is subsequently reversed, the carrying amount of the corresponding asset or cash-generating unit is increased to the revised estimate of its recoverable amount, but only to the extent of the carrying amount that would have been determined had no impairment loss been recognized for the asset or cash-generating unit in prior years. A reversal of an impairment loss is recognized in profit or loss.

Financial Instruments

Financial assets and financial liabilities are recognized when the Group becomes a party to the contractual provisions of the instruments.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to an acquisition or issuance of financial assets and financial liabilities (other than financial assets and financial liabilities at FVTPL) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at FVTPL are recognized immediately in profit or loss.

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Financial assets

All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis.

a. Measurement category

Financial assets are classified into the following categories: Financial assets at FVTPL, financial assets at amortized cost, and investments in equity instruments at FVTOCI.

1) Financial assets at FVTPL

Financial asset is classified as at FVTPL when the financial asset is mandatorily classified as at FVTPL. Financial assets mandatorily classified as at FVTPL include investments in equity instruments which are not designated as at FVTOCI and debt instruments that do not meet the amortized cost criteria or the FVTOCI criteria.

Financial assets at FVTPL are subsequently measured at fair value, with any gains or losses arising on remeasurement recognized in profit or loss. The net gain or loss recognized in profit or loss does not incorporate any dividend or interest earned on the financial asset. Fair value is determined in the manner described in Note 36.

2) Financial assets at amortized cost

Financial assets that meet the following conditions are subsequently measured at amortized cost:

a) The financial asset is held within a business model whose objective is to hold financial asset in order to collect contractual cash flows; and
b) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Subsequent to initial recognition, financial assets at amortized cost, including cash and cash equivalents, trade receivables, other receivables and debt instruments at amortized cost, are measured at amortized cost, which is the gross carrying amount determined by the effective interest method less any impairment loss. Exchange differences are recognized in profit or loss.

Interest income is calculated by applying the effective interest rate to the gross carrying amount of the financial asset.

Cash equivalents include time deposits, bonds sold under repurchase agreements and commercial papers with original maturities within 3 months from the date of acquisition, which are highly liquid, readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value. These cash equivalents are held for the purpose of meeting short-term cash commitments.

3) Investments in equity instruments at FVTOCI

On initial recognition, the Group may make an irrevocable election to designate investments in equity instruments as at FVTOCI. Designation at FVTOCI is not permitted if the equity investment is held for trading or if it is contingent consideration recognized by an acquirer in a business combination.

Investments in equity instruments at FVTOCI are subsequently measured at fair value with gains and losses arising from changes in fair value recognized in other comprehensive income and accumulated in other equity. The cumulative gain or loss will not be reclassified to profit or loss on disposal of the equity investments, instead, they will be transferred to retained earnings.

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Dividends on these investments in equity instruments are recognized in profit or loss when the Group’s right to receive the dividends is established, unless the dividends clearly represent a recovery of part of the cost of the investment.

b. Impairment of financial assets

The Group recognizes a loss allowance for expected credit loss (ECLs) on financial assets at amortized cost (including trade receivables) as well as finance lease receivables at the end of each reporting period.

The Group always recognizes lifetime ECLs for trade receivables. For all other financial instruments and finance lease receivables, the Group recognizes lifetime ECLs when there has been a significant increase in credit risk since initial recognition. If, on the other hand, the credit risk on the financial instrument has not increased significantly since initial recognition, the Group measures the loss allowance for that financial instrument at an amount equal to 12-month ECLs.

ECLs reflect the weighted average of credit losses with the respective risks of default occurring as the weights. Lifetime ECLs represent the expected credit losses that will result from all possible default events over the expected life of a financial instrument. In contrast, 12-month ECLs represent the portion of lifetime ECLs that is expected to result from default events on a financial instrument that are possible within 12 months after the reporting date.

Impairment loss on all financial instruments is recognized with a corresponding adjustment to their carrying amount through a loss allowance account.

c. Derecognition of financial assets

The Group derecognizes a financial asset only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party.

On derecognition of a financial asset at amortized cost in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable is recognized in profit or loss. On derecognition of an investment in an equity instrument at FVTOCI, the cumulative gain or loss which had been recognized in other comprehensive income is transferred directly to retained earnings, without recycling through profit or loss.

Financial liabilities

a. Subsequent measurement

Except the following situation, all financial liabilities are measured at amortized cost using the effective interest method:

Financial liabilities are held for trading and are stated at fair value, and any interest paid on such financial liabilities is recognized in finance costs; any remeasurement gains or losses on such financial liabilities are recognized in other gains or losses. Fair value is determined in the manner described in Note 36.

b. Derecognition of financial liabilities

The difference between the carrying amount of the financial liability derecognized and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognized in profit or loss.

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Convertible bonds

The component parts of convertible bonds issued by the Group are classified separately as financial liabilities and equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

On initial recognition, the fair value of the liability component is estimated using the prevailing market interest rate for similar non-convertible instruments. This amount is recorded as a liability on an amortized cost basis using the effective interest method until extinguished upon conversion or upon the instrument’s maturity date. Any embedded derivative liability is measured at fair value.

The conversion option classified as equity is determined by deducting the amount of the liability component from the fair value of the compound instrument as a whole. This is recognized and included in equity, net of income tax effects, and is not subsequently remeasured. In addition, the conversion option classified as equity will remain in equity until the conversion option is exercised; in which case, the balance recognized in equity will be transferred to capital surplus - share premiums. When the conversion option remains unexercised at maturity, the balance recognized in equity will be transferred to capital surplus - share premiums.

Transaction costs that relate to the issuance of the convertible notes are allocated to the liability and equity components in proportion to the allocation of the gross proceeds. Transaction costs relating to the liability component are included in the carrying amount of the liability component. Transaction costs relating to the equity component are recognized directly in equity.

Derivative financial instruments

The Group enters into cross-currency swap contracts to manage its exposure to interest rate and foreign exchange rate risks.

Derivatives are initially recognized at fair value at the date on which the derivative contracts are entered into and are subsequently remeasured to their fair value at the end of each reporting period. The resulting gain or loss is recognized in profit or loss immediately. When the fair value of a derivative financial instrument is positive, the derivative is recognized as a financial asset; when the fair value of a derivative financial instrument is negative, the derivative is recognized as a financial liability.

Derivatives embedded in hybrid contracts that contain financial asset hosts that is within the scope of IFRS 9 are not separated; instead, the classification is determined in accordance with the entire hybrid contract. Derivatives embedded in non-derivative host contracts that are not financial assets that is within the scope of IFRS 9 (e.g., financial liabilities) are treated as separate derivatives when they meet the definition of a derivative; their risks and characteristics are not closely related to those of the host contracts; and the mixed contracts are not measured at FVTPL.

Provisions

Provisions are measured at the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

Revenue Recognition

The Group identifies the contract with the customers, identifies the performance obligations in the contract, allocates the transaction price to the performance obligations, and recognizes revenue when performance obligations are satisfied.

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When another party is involved in providing goods or services to a customer, the Group is a principal if it controls the specified good or service before that good or service is transferred to a customer; otherwise, the Group is acting as an agent. The principal recognizes revenues and costs associated with providing the goods or services at the gross amount, while an agent recognizes revenue at the net amount. When a specified good or service is a distinct good or service, the Group determines whether it is a principal or an agent for each specified good or service.

The Group is a principal if it obtains control of any one of the following:

a. Before the good or another asset transfers to the customer, the Group acquire the good or the control of asset from another party.
b. The right to a service to be performed by another party which gives the Group the ability to direct that party to provide the service to the customer on its behalf.
c. A good or service from another party that it then combines with other goods or services in providing a specified good or service to the customer.

Indicators to support the Group’s assessment of whether it controls a specified good or service include, but are not limited to, the following:

a. The Group is primarily responsible for fulfilling the promise to provide the specified good or service.
b. The Group has inventory risk before or after the specified good or service is transferred to the customer.
c. The Group has discretion in establishing the price of the specified good or service.

Leases

2019

At the inception of a contract, the Group assesses whether the contract is, or contains, a lease.

For a contract that contains a lease component and non-lease components, the Group allocates the consideration in the contract to each component on the basis of the relative stand-alone price and accounts for each component separately.

a. The Group as lessor

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

Under finance leases, the lease payments comprise fixed payments, variable lease payments which depend on an index or a rate, and residual value guarantees. The net investment in a lease is measured at (a) the present value of the sum of the lease payments receivable by a lessor and any unguaranteed residual value accrued to the lessor plus (b) initial direct costs and is presented as a finance lease receivable. Finance lease income is allocated to the relevant accounting periods so as to reflect a constant, periodic rate of return on the Group’s net investment outstanding in respect of leases.

Lease payments from operating leases are recognized as income on a straight-line basis over the terms of the relevant leases. Initial direct costs incurred in obtaining operating leases are added to the carrying amounts of the underlying assets and recognized as expenses on a straight-line basis over the lease terms.

Variable lease payments that do not depend on an index or a rate are recognized as income in the periods in which they are incurred.

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When a lease includes both land and building elements, the Group assesses the classification of each element separately as a finance or an operating lease based on the assessment as to whether substantially all the risks and rewards incidental to ownership of each element have been transferred to the lessee. The lease payments are allocated between the land and the building elements in proportion to the relative fair values of the leasehold interests in the land element and building element of the lease at the inception of a contract. If the allocation of the lease payments can be made reliably, each element is accounted for separately in accordance with its lease classification. When the lease payments cannot be allocated reliably between the land and building elements, the entire lease is generally classified as a finance lease unless it is clear that both elements are operating leases; in which case, the entire lease is classified as an operating lease.

b. The Group as lessee

The Group recognizes right-of-use assets and lease liabilities for all leases at the commencement date of a lease, except for short-term leases and low-value asset leases accounted for applying a recognition exemption where lease payments are recognized as expenses on a straight-line basis over the lease terms.

Right-of-use assets are initially measured at cost, which comprises the initial measurement of lease liabilities adjusted for lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs needed to restore the underlying assets, and less any lease incentives received. Right-of-use assets are subsequently measured at cost less accumulated depreciation and impairment losses and adjusted for any remeasurement of the lease liabilities. Right-of-use assets are presented on a separate line in the consolidated balance sheets.

Right-of-use assets are depreciated using the straight-line method from the commencement dates to the earlier of the end of the useful lives of the right-of-use assets or the end of the lease terms.

Lease liabilities are initially measured at the present value of the lease payments, which comprise fixed payments and variable lease payments which depend on an index or a rate. The lease payments are discounted using the interest rate implicit in a lease, if that rate can be readily determined. If that rate cannot be readily determined, the Group uses the lessee’s incremental borrowing rate.

Subsequently, lease liabilities are measured at amortized cost using the effective interest method, with interest expense recognized over the lease terms. When there is a change in a lease term or a change in future lease payments resulting from a change in an index or a rate used to determine those payments, the Group remeasures the lease liabilities with a corresponding adjustment to the right-of-use-assets. However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount of the remeasurement is recognized in profit or loss. Lease liabilities are presented on a separate line in the consolidated balance sheets.

Variable lease payments that do not depend on an index or a rate are recognized as expenses in the periods in which they are incurred.

2018

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

a. The Group as lessor

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

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

b. The Group as lessee

Operating lease payments are recognized as expenses on a straight-line basis over the lease term.

c. Leasehold land for own use

If the allocation of the lease payments can be made reliably, each element is accounted for separately in accordance with its lease classification. When the lease payments cannot be allocated reliably between the land and building elements, the entire lease is generally classified as a finance lease unless it is clear that both elements are operating leases; in which case, the entire lease is classified as an operating lease.

Government Grants

Government grants are not recognized until there is reasonable assurance that the Group will comply with the conditions attaching to them and that the grants will be received.

Government grants are recognized in profit or loss on a systematic basis over the periods in which the Group recognizes as expenses the related costs for which the grants are intended to compensate. Specifically, government grants whose primary condition is that the Group should purchase, construct or otherwise acquire non-current assets are recognized as deferred revenue transferred to profit or loss on a systematic and rational basis over the useful lives of the related assets.

Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the Group with no future related costs are recognized in profit or loss in the period in which they become receivable.

Employee Benefits

a. Short-term employee benefits

Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for the related services.

b. Retirement benefits

Payments to defined contribution retirement benefit plans are recognized as expenses when employees have rendered services entitling them to the contributions.

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Defined benefit costs (including service cost, net interest and remeasurement) under defined benefit retirement benefit plans are determined using the projected unit credit method. Service cost (including current service cost, past service cost, as well as gains and losses on settlements) and net interest on the net defined benefit liabilities (assets) are recognized as employee benefits expense in the period in which they occur. Remeasurement, comprising actuarial gains and losses and the return on plan assets (excluding interest), is recognized in other comprehensive income in the period in which it occurs. Remeasurement recognized in other comprehensive income is reflected immediately in retained earnings and will not be reclassified to profit or loss.

Net defined benefit liabilities (assets) represent the actual deficit (surplus) in the Group’s defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any refunds from the plans or reductions in future contributions to the plans.

c. Termination benefits

A liability for a termination benefit is recognized at the earlier of when the Group can no longer withdraw the offer of the termination benefit and when the Group recognizes any related restructuring costs.

Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax.

a. Current tax

According to the Income Tax Law, an additional tax of unappropriated earnings is provided for as income tax in the year the shareholders approve to retain earnings.

Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax provision.

b. Deferred tax

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the consolidated financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences and unused loss carry forward to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.

Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates, and interests in joint ventures, except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments and interests are only recognized to the extent that it is probable that there will be sufficient taxable profits against which to utilize the benefits of the temporary differences and they are expected to reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. A previously unrecognized deferred tax asset is also reviewed at the end of each reporting period and recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

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Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realized, 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 assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. If investment properties measured using the fair value model are non-depreciable assets, or are held under a business model whose objective is not to consume substantially all of the economic benefits embodied in the assets over time, the carrying amounts of such assets are presumed to be recovered entirely through sale.

c. Current tax and deferred tax for the year

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

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the Group’s accounting policies, management is required to make judgments, estimations and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered relevant. Actual results may differ from these estimates.

The 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 if the revisions affect only that period or in the period of the revisions and future periods if the revisions affect both current and future periods.

Estimated Impairment of Trade Receivables

The provision for impairment of trade receivables is based on assumptions about risk of default and expected loss rates. The Group uses judgment in making these assumptions and in selecting the inputs to the impairment calculation, based on the Group’s historical experience, existing market conditions as well as forward looking estimates as of the end of each reporting period. For details of the key assumptions and inputs used, see Note 10.

Fair Value Measurements and Valuation Process

If some of the Group’s assets and liabilities measured at fair value have no quoted prices in active markets, the Group determines whether to engage third party qualified appraisers for the application of appropriate valuation techniques for fair value measurements in accordance with related regulations or professional standards.

Where Level 1 inputs are not available, the engaged appraisers would determine appropriate inputs by referring to the existing lease contracts and rentals of similar properties in the vicinity of the Group’s investment properties. If the actual changes of inputs in the future differ from expectation, fair value might vary accordingly.

Information about the valuation techniques and inputs used in determining the fair value of various assets and liabilities is disclosed in Notes 18.

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6. CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS
Checking accounts and demand deposits Petty cash Cash on hand Cash equivalents (investments with original maturities of less than 3 months) Time deposits Repurchase agreements collateralized by bonds		December 31
		2019 $ 7,579,735 4,070 746 15,689,128 1,461,816 $ 24,735,495	2018 $ 6,003,398 3,706 3,843 8,745,170 173,294 $ 14,929,411

The market rate intervals of time deposits and repurchase agreements collateralized by bonds at the end of the reporting period were as follows:

Time deposits Repurchase agreements collateralized by bonds	December 31
	2019 2018 0.52%-5.50% 1.00%-4.80% 0.45%-2.36% 0.52%-2.52%

As of December 31, 2019 and 2018, the Group’s bank deposits in the amounts of $419,742 thousand and $169,139 thousand, respectively, are restricted as collaterals for bank loans and classified as financial assets at amortized cost in the balance sheets. Time deposits with original maturities of more than 3 months in the amounts of $22,633,007 thousand and $14,168,377 thousand, respectively, are also classified as financial assets at amortized cost in the balance sheets as of December 31, 2019 and 2018. Refer to Note 9.

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS - CURRENT

Financial assets at FVTPL Financial assets mandatorily classified as at FVTPL Non-derivative financial assets Beneficiary certificates Listed shares Financial liabilities at FVTPL Financial liabilities held for trading Derivative financial liabilities (not under hedge accounting) Bond options (Note 26) Cross-currency swap contracts		December 31	December 31
		2019 $ 1,253,617 3,474,606 $ 4,728,223 $ 81,724 30,346 $ 112,070	2018 $ 5,543,595 3,502,988 $ 9,046,583 $ 223,501 44,717 $ 268,218

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The Group entered into cross-currency swap contracts to manage exposures to exchange rate fluctuations. The Group’s financial hedging strategy is to avoid most of the cash flow risk exposure. As of December 31, 2019 and 2018, outstanding cross-currency swap contracts not under hedge accounting were as follows:

Notional Amounts		Range of Interest	Range of Interest
(In Thousands)	Maturity Date	Rates Paid	Rates Received
US$215,000	2021.09.15	-	2.68%-2.80%

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

December 31

Domestic investments Listed shares Unlisted shares Foreign investments Listed shares Unlisted shares		2019 Current Non-current $ 3,765,869 $ 9,472,552 - 1,614,601 3,765,869 11,087,153 212,497 - - 604,985 212,497 604,985 $ 3,978,366 $ 11,692,138		2018	2018
		Current $ 3,765,869 - 3,765,869 212,497 - 212,497 $ 3,978,366		Current $ 3,648,586 - 3,648,586 152,337 - 152,337 $ 3,800,923	Non-current $ 8,125,426 1,537,291 9,662,717 - 122,026 122,026 $ 9,784,743

a. These investments in equity instruments are not held for trading. Instead, they are held for medium to long-term strategic purposes. Accordingly, the management elected to designate these investments in equity instruments as at FVTOCI as they believe that recognizing short-term fluctuations in these investments’ fair value in profit or loss would not be consistent with the Group’s strategy of holding these investments for long-term purposes.
b. The board of directors of China Shanshui Cement Group Limited (CSCGL) announced on April 16, 2015 that the percentage of CSCGL’s securities held by the public fell below the prescribed minimum requirement of 25% according to the Main Board Listing Rules 8.08 of Hong Kong Exchanges and Clearing Limited (the “Exchange”). Therefore, the Exchange suspended the trading of CSCGL’s securities until the percentage of securities in public hands satisfies the minimum requirement.

On October 30, 2018, CSCGL’s shareholders resolved to restore the minimum public float requirement of 25% by issuing new shares of 974,825,988 at HK$4.2 per share. Then CSCGL resumed its trading on the Exchange effective on October 31, 2018.

The Group originally held 22.50% equity interest in CSCGL but the shareholding was reduced to 17.46% after the subscription mentioned above. However, Mrs. Wu Ling-Ling, the Corporation’s chief financial officer, was elected to be the executive director of CSCGL on May 23, 2018. As CSCGL already addressed the audit issues raised by the Exchange and confirmed the potential dilution of shareholding in the Group’s interests in CSCGL, the Group objectively demonstrated that it was able to exercise significant influence over CSCGL although the Group only held less than 20% of the voting power. Accordingly, the Group’s investment in CSCGL was reclassified from financial assets at fair value through other comprehensive income to investments accounted for using the equity method at the closing price of the Exchange on October 31, 2018. Refer to Note 15.

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c. Asia Cement Pioneer Investment Ltd. (ACP) acquired the shares of Cementon Micronesia LLC for US$3,900 thousand in September 2010. As of December 31, 2019, 50% of the investment consideration was not paid and accounted for as accounts payable and accrued expenses - third parties. The consideration will be paid once the counterparty asks for payment.
d. Refer to Note 38 for information relating to financial assets at fair value through other comprehensive income pledged as collaterals.

9. FINANCIAL ASSETS AT AMORTIZED COST

Time deposits with original maturities of more than 3 months Restricted assets Current Non-current		December 31	December 31
		2019 $ 22,633,307 419,742 $ 23,053,049 $ 23,016,985 $ 36,064	2018 $ 14,168,377 169,139 $ 14,337,516 $ 14,322,874 $ 14,642

Based on the Group’s assessment, the credit risk of these financial assets is not expected to be high and has not increased since initial recognition.

Refer to Note 38 for information relating to financial assets at amortized cost pledged as collaterals.

10. TRADE RECEIVABLES

At amortized cost Trade receivables - sales Finance lease receivable - current (Note 11) Construction receivable Operating lease receivable Less: Allowance for impairment loss - sales Less: Allowance for impairment loss - construction	2019 $ 11,145,513 723,487 114,242 23,119 (1,042,840) (918) $ 10,962,603	2018 $ 10,322,875 672,230 105,262 12,438 (884,685) - $ 10,228,120

Trade Receivables - Sales

The average credit period of receivables from sales of goods was 30-90 days. Specific customers with good credit records were given longer credit period occasionally. The average credit period for customers of concrete products was 180-365 days after construction of building was finished.

The Group reviews the recoverable amount of each individual trade debt at the end of the reporting period to ensure that adequate allowance is made for possible irrecoverable amounts. The Group obtains sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults.

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The Group applies the simplified approach to providing for expected credit losses prescribed by IFRS 9, which permits the use of lifetime expected loss provision for all trade receivables. The expected credit losses on trade receivables are estimated by reference to past default experience of the debtor and an analysis of the debtor’s current financial position, adjusted for general economic conditions of the industry in which the debtors operate and an assessment of both the current as well as the forecast direction of economic conditions at the reporting date.

The Group writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery. For trade receivables that have been written off, the Group continues to engage in enforcement activity to attempt to recover the receivables due. Where recoveries are made, these are recognized in profit or loss.

December 31, 2019

Gross carrying amount Loss allowance (lifetime ECLs) Amortized cost December 31, 2018 Gross carrying amount Loss allowance (lifetime ECLs) Amortized cost	Less than 90 Days 91 to 180 Days $ 6,690,351 $ 2,202,629 (51,582) (79,468) $ 6,638,769 $ 2,123,161 Less than 90 Days 91 to 180 Days $ 6,595,347 $ 1,864,201 (109,335) (73,046) $ 6,486,012 $ 1,791,155	181 to 365 Days Over 366 Days $ 885,134 $ 1,367,399 (112,300) (799,490) $ 772,834 $ 567,909 181 to 365 Days Over 366 Days $ 553,258 $ 1,310,069 (119,917) (582,387) $ 433,341 $ 727,682	Total $ 11,145,513 (1,042,840)
			$ 10,102,673
			Total $ 10,322,875 (884,685)
			$ 9,438,190

The above aging schedule was based on the invoice date.

The movements of the loss allowance of trade receivables were as follows:

Balance at January 1 Add: Impairment losses recognized on receivables Add: Amounts recovered from the prior year write-offs Less: Amounts written off Effect of foreign currency exchange differences Balance at December 31	2019 $ 884,685 191,031 32,035 (21,687) (42,306) $ 1,043,758	2018 $ 761,114 142,553 2,318 (6,845) (14,455) $ 884,685

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11. FINANCE LEASE RECEIVABLES

2019
Undiscounted lease payments
Year 1

Year 2
Year 3
Year 4
Year 5
Year 6 onwards

Less: Unearned finance income

Net investment in leases presented as finance lease receivables

Current

Non-current

2018
Minimum lease payments
Not later than 1 year

Later than 1 year and not later than 5 years
Later than 5 years

Less: Unearned finance income

Present value of minimum lease payments

Lease receivables
Not later than 1 year

Later than 1 year and not later than 5 years
Later than 5 years

Present value of minimum lease payments

Current

Non-current

December 31,
2019
$ 1,401,682
1,401,682
1,401,682
1,401,682
1,401,682

5,606,728
12,615,138

(3,720,784)
$ 8,894,354
$ 723,487

8,170,867
$ 8,894,354
December 31,
2018
$ 1,401,682
5,606,728

7,008,410
14,016,820

4,450,235
$ 9,566,585
$ 672,230
3,242,092

5,652,263
$ 9,566,585
$ 672,230

8,894,355
$ 9,566,585

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Chiahui Power Corp. (CHP) entered into a 25-year purchase and sale agreement with Taiwan Power Company (TPC). According to the agreement, all electricity generated by CHP is sold to TPC. CHP started its operation on December 15, 2003. Because the nature of the agreement is considered as conveyance of rights to use asset, the agreement is regarded as finance lease.

The Group measures the loss allowance for finance lease receivables at an amount equal to lifetime ECLs. As of December 31, 2019, no finance lease receivable was past due. The Group has not recognized a loss allowance for finance lease receivables after taking into consideration the historical default experience and the future prospects of the industries in which the lessees operate.

12. OTHER RECEIVABLES

Asia Cement (China) Holdings Corp. (ACCHC), Far Eastern Polytex (Holding) Limited (FEPHL) and FEDS Development (BVI) Ltd. (FEDSBVI) intend to invest in Yuan Ding Enterprise (Shanghai) Limited (YDES) and acquire 40%, 40% and 20% equity, respectively. Through this investment, ACCHC can join projects on land development and commercial building construction in the World Exposition district in Shanghai.

YDES was initially established with registered capital of RMB500,000 thousand by Far Eastern New Century (China) Corporation (FENCC), a wholly owned subsidiary of FEPHL. When the completion of the construction process of the commercial building reaches 25%, ACCHC will subscribe to new shares issued by YDES, and ACCHC’s ultimate ownership is expected to be 40%. ACCHC has signed related investment contracts with FEPHL and FEDSBVI.

YDES’s board of directors resolved to issue new shares for cash on February 18, 2019 and June 30, 2019, respectively. After the capital increase, YDES’s registered capital increased to RMB1,763,425 thousand. ACCHC subscribed for cash capital increase of YDES through Oriental Holdings Co., Ltd., its indirect subsidiary, for RMB714,190 thousand. The investment was accounted for using equity method. Refer to Note 15.

As of December 31, 2018, ACCHC agreed to grant one-year interest-free credit loan to FENCC (a subsidiary of FENC) and YDES in the amount of RMB431,900 thousand and RMB230,000 thousand, respectively. The borrower can use the loan during the loan period. As of December 31, 2018, the loan amounts drawn by FENCC and YDES were RMB431,900 thousand and RMB114,699 thousand, respectively. The aforementioned amounts were accounted for as other receivables.

The Group believes that potential benefit from the investment will exceed potential interest income if interest is charged on the loan. The Group did not consider the loan an independent transaction but took it as part of a more beneficial investment strategy. Accordingly, the borrowers were not required to pay any interest unless the development project failed to be implemented. In addition, FENC is FENCC’s and YDES’s ultimate parent company, so the Group believes that the borrowers have sufficient financial resources to repay the loan and thus did not take any collateral. As of December 31, 2019, the loans receivable have been fully recovered.

36 -

13. INVENTORIES

INVENTORIES
Finished goods Work in progress Raw materials Supplies		December 31
		2019 $ 2,597,488 928,473 2,236,836 2,026,997 $ 7,789,794	2018 $ 3,095,204 1,176,038 3,519,927 2,013,107 $ 9,804,276

The cost of inventories recognized as cost of goods sold for the years ended December 31, 2019 and 2018 was $56,533,839 thousand and $54,480,379 thousand, respectively. The cost of goods sold included reversals of inventory write-downs of $18,619 thousand and inventory write-downs of $315,353 thousand.

14. SUBSIDIARIES

a. Subsidiaries included in the consolidated financial statements

Investor
Subsidiary
The Corporation
Der Ching Investment Corp. (DCI)
Ya Tung Ready-Mixed Concrete Corp. (YTRMC)
Nan Hwa Cement Corp. (NHC)
Chiahui Power Corp. (CHP)
Asia Cement (Singapore) Pte. Ltd. (ACSPL)
ACCHC
Ya Li Precast and Prestressed Concrete Industries Corp.
(YLPPC)
Asia Investment Corp. (AIC)
Fu Ming Transport Corp. (FMT)
Asia Engineering Enterprise Corp. (AEE)
Sunrise Industrial Holdings Ltd. (SIHL)
Yuan Long Stainless Steel Corp. (YLSS)
Yali Transportation Corp. (YLT)
DCI
Kowloon Cement Corp. Ltd. (KCC)
Fu Shan Mineral Stone Co., Ltd. (FSMS)
AC Mega Investment Ltd. (ACM)
AC Mega II Investment Ltd. (ACM II)
AC Mega III Investment Ltd. (ACM III)
AC Mega IV Investment Ltd. (ACM IV)
AC Leap Investment Ltd. (ACL)
YTRMC
Ya Sing Ready-Mixed Concrete Corp. (YSRMC)
Ya Tung Vietnam Co., Ltd. (YTV)
PT Yatung Concrete International (PYCI)
Asia Oriental (Guam) LLC (AOG)
AOG
Asia Oriental Concrete, LLC (AOC)
FMT
Fu Da Transportation Corp. (FDT)
AEE
ACCHC
AIC
CHP
DCI
NHC
FMT
FSMS
FDT
YSRMC

Proportion of Ownership
and Voting Rights
December 31
2019
2018
Remark
99.99
99.99
99.99
99.99
99.94
99.94
59.59
59.59
Note 1
99.96
99.96
67.73
67.73
Note 1
83.81
83.81
100.00
100.00
99.82
99.82
98.23
98.23
100.00
100.00
100.00
100.00
51.00
51.00
49.00
49.00
99.56
99.56
100.00
100.00
Note 6
100.00
100.00
Note 6
100.00
100.00
100.00
100.00
100.00
100.00
Note 6
69.93
69.93
100.00
100.00
99.00
99.00
Note 2
95.04
77.69
Note 5
71.70
64.50
Note 5
99.87
99.87
0.20
0.20
0.01
0.01
-
-
0.02
0.02
0.02
0.02
0.39
0.39
0.03
0.03
0.05
0.05
(Continued)

37 -

Investor
Subsidiary
AEE
YTRMC
Asia Cement Explorer Investment Ltd. (ACE)
Asia Cement Pioneer Investment Ltd. (ACP)
Asia Cement Pioneer II Investment Ltd. (ACP II)
Asia Cement Pioneer III Investment Ltd. (ACP III)
Asia Cement Pioneer IV Investment Ltd. (ACP IV)
YLPPC
PYCI
Ya Li Precast Concrete India Pvt. Ltd. (YLPCIP)
AOG
ACSPL
Oriental Concrete Pte. Ltd. (OCPL)
ACCHC
ACCHC
Perfect Industrial Holdings Pte. Ltd. (PIHPL)
PIHPL
Asia Continent Investment Holdings Pte. Ltd. (ACIHPL)
Oriental Industrial Holdings Pte. Ltd. (OIHPL)
ACIHPL
Jiangxi Yadong Cement Co., Ltd. (JYDC)
OIHPL
Wuhan Yadong Cement Co., Ltd. (WYDC)
Oriental Holdings Co., Ltd. (OHC)
Shanghai Yafu Cement Products Co., Ltd. (SHYFCP)
Shanghai Yali Cement Products Co., Ltd. (SHYLCP)
Hubei Yadong Cement Co., Ltd. (HYDCCL)
Sichuan Yali Concrete Produce Co., Ltd. (SYCPCL)
Sichuan Yali Transport Co., Ltd. (SYTCL)
Yangzhou Yadong Cement Co., Ltd. (YYDCCL)
Sichuan Yadong Cement Co., Ltd. (SIYDCCL)
Chengdu Yali Cement Products Co., Ltd. (CYCPCL)
Huanggang Yadong Cement Co., Ltd. (HGYDC)
JYDC
Jiangxi Yali Transport Co., Ltd. (JYLTC)
Nanchang Yadong Cement Co., Ltd. (NYDC)
Nanchang Yali Concrete Produce Ltd. (NYLC)
Ruichang Yadong New Material Co., Ltd. (RYNM)
OHC
JYDC
WYDC
SHYFCP
NYDC
JYLTC
SHYLCP
SYTCL
SIYDCCL
HGYDC
YYDCCL
CYCPCL
HYDCCL
SYCPCL
Tai Zhou Oriental Construction Co., Ltd. (TZOCCL)
WYDC
Wuhan Yali Cement Products Co., Ltd. (WYCPCL)
SIYDCCL
Sichuan Lanfeng Cement Co., Ltd. (SLCL)
SLCL
Sichuan Lanfeng Construction Co., Ltd. (SLCCL)
HYDCCL
Hubei Yali Transport Co., Ltd. (HYTCL)
Wuhan Yaxin Cement Co., Ltd. (WYXC)
KCC
Kowloon Concrete Corporation Limited (KCCL)
Join Fortune Trading Ltd. (JFTL)
SHYLCP
SHYFCP

Proportion of Ownership
and Voting Rights
December 31
2019
2018
Remark
0.07
0.07
-
-
100.00
100.00
Note 7
100.00
100.00
Note 7
100.00
100.00
Note 7
100.00
100.00
Note 7
100.00
100.00
Note 7
1.00
1.00
Note 2
99.99
99.99
4.96
22.31
Note 5
100.00
100.00
4.07
4.07
100.00
100.00
100.00
100.00
99.99
99.99
85.00
85.00
90.00
90.00
100.00
100.00
-
-
Note 3
90.00
90.00
90.00
90.00
90.00
90.00
90.00
90.00
90.00
90.00
90.00
90.00
51.22
51.22
90.00
90.00
51.99
51.99
50.00
50.00
100.00
100.00
100.00
-
Note 4
10.00
10.00
10.00
10.00
-
-
Note 3
25.00
25.00
48.00
48.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
48.78
48.78
10.00
10.00
10.00
10.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
90.00
90.00
100.00
100.00
100.00
100.00
-
-
Note 3
(Concluded)

Remarks:

Note 1: Subsidiaries that have material non-controlling interests. See Tables 7 and 8 for the information on the places of incorporation and principal places of business.

38 -
Note 2: On October 30, 2018, YTRMC and YLPPC entered into an agreement to jointly establish PYCI and held 99% and 1% interests in PYCI, respectively. As of December 31, 2019, total investments accumulated amounted to US$2,000 thousand. PYCI manufactures and sells ready-mixed concrete.
Note 3: On July 26, 2018, the Group disposed of SHYFCP. The proceeds from disposal and net gain on disposal of subsidiary amounted to RMB29,421 thousand and RMB9,051 thousand, respectively.
Note 4: On January 29, 2019, JYDC established a 100% owned subsidiary, RYNM. As of December 31, 2019, accumulated investments amounted to RMB2,000 thousand. RYNM mainly manufactures new building materials products and construction waste.
Note 5: On December 2, 2019, YTRMC subscribed for additional new shares of AOC through AOG for US$2,000 at a percentage different from its existing ownership percentage, increasing its continuing interest in AOG from 77.69% to 95.04%. After the subscription, AOG’s interest in AOC increased from 64.5% to 71.7%. YLPPC’s percentage of ownership in AOG decreased from 22.31% to 4.96% accordingly since it did not participate in this subscription.
Note 6: In January 2019, the Corporation’s subsidiary, DCI, fully subscribed for cash capital increase of its subsidiaries, ACL, ACM and ACM II, for US$8,700 thousand, US$8,100 thousand and US$6,700 thousand, respectively.
Note 7: In December 2019, the Corporation’s subsidiary, AIC, fully subscribed for cash capital increase of its subsidiaries, ACE, ACP, ACP II, ACP III and ACP IV for US$9,500 thousand, US$2,000 thousand, US$9,500 thousand, US$9,500 thousand and US$9,500 thousand, respectively.
b. Subsidiaries excluded from the consolidated financial statements: None.
c. Details of subsidiaries that have material non-controlling interests

Principal Place of Business Refer to Table 7 Refer to Tables 7 and 8 Profit (Loss) Allocated to Non-controlling Interests For the Year Ended December 31 2019 2018 $ 4,321,381 $ 3,443,947 443,213 352,011 19,686 (23,855) $ 4,784,280 $ 3,772,103	Proportion of Ownership and Voting Rights Held by Non-controlling Interests	Proportion of Ownership and Voting Rights Held by Non-controlling Interests
	December 31
	2019 2018 40.40% 40.40% 28.00% 28.00% Accumulated Non-controlling Interests

	December 31
2019 $ 4,321,381 443,213 19,686 $ 4,784,280	2019 $ 18,753,394 3,886,984 741,302 $ 23,381,680	2018 $ 16,698,351 3,728,503 729,266 $ 21,156,120

39 -

Summarized financial information in respect of each of the Group’s subsidiaries that has material non-controlling interests is set out below. The summarized financial information below represents amounts before intragroup eliminations.

CHP:

Current assets Non-current assets Current liabilities Non-current liabilities Equity Equity attributable to: Owners of the Corporation Non-controlling interests of CHP Revenue Profit for the year Other comprehensive income (loss) for the year Total comprehensive income for the year Profit attributable to: Owners of the Corporation Non-controlling interests of CHP Total comprehensive income attributable to: Owners of the Corporation Non-controlling interests of CHP Dividends paid to non-controlling interest CHP		December 31	December 31
	2019 2018 $ 3,143,217 $ 1,981,089 13,720,031 11,948,216 3,506,027 3,843,336 3,735,973 857,002 $ 9,621,248 $ 9,228,967 $ 5,734,264 $ 5,500,464 3,886,984 3,728,503 $ 9,621,248 $ 9,228,967 For the Year Ended December 31
		2019 $ 7,115,116 $ 1,097,061 220 $ 1,097,281 $ 653,848 443,213 $ 1,097,061 $ 653,980 443,301 $ 1,097,281 $ 284,820	2018 $ 6,682,384 $ 871,315 (1,109) $ 870,206 $ 519,304 352,011 $ 871,315 $ 518,643 351,563 $ 870,206 $ 284,860

40 -

ACCHC and its subsidiaries:

Current assets Non-current assets Current liabilities Non-current liabilities Equity Equity attributable to: Owners of the Corporation Non-controlling interests of ACCHC Non-controlling interests of ACCHC’s subsidiaries Revenue Profit for the year Other comprehensive loss for the year Total comprehensive income for the year Profit attributable to: Owners of the Corporation Non-controlling interests of ACCHC Non-controlling interests of ACCHC’s subsidiaries Total comprehensive income attributable to: Owners of the Corporation Non-controlling interests of ACCHC Non-controlling interests of ACCHC’s subsidiaries Dividends paid to non-controlling interest ACCHC ACCHC’s subsidiaries		December 31	December 31
	2019 2018 $ 54,137,126 $ 46,700,020 48,712,010 45,832,407 33,015,509 18,119,166 7,057,620 18,865,216 $ 62,776,007 $ 55,548,045 $ 44,022,613 $ 38,849,694 17,119,905 15,108,214 1,633,489 1,590,137 $ 62,776,007 $ 55,548,045 For the Year Ended December 31
		2019 $ 56,622,141 $ 14,478,342 (2,606,473) $ 11,871,869 $ 10,156,961 3,949,929 371,452 $ 14,478,342 $ 8,280,300 3,220,117 371,452 $ 11,871,869 $ 1,208,421 $ 248,835	2018 $ 51,612,506 $ 11,364,401 (898,139) $ 10,466,262 $ 7,920,454 3,080,176 363,771 $ 11,364,401 $ 7,273,794 2,828,698 363,770 $ 10,466,262 $ 319,715 $ 116,017

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15. INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD

Investments in associates Investments in joint ventures a. Investments in associates Material associates Listed shares FENC U-Ming Marine Transport Corp. (U-Ming) CSCGL Associates that are not individually material Unlisted shares Yuan Ding Co., Ltd. (YDC) Far Eastern Construction Co., Ltd. (FEC) Yuan Ding Enterprise (Shanghai) (YDES) Yue Yuan Investment Corp. (YYI) Oriental Securities Corp. (OSC) Yue Ding Enterprise Corp. (YDEC) FEDS Development Ltd. (FEDSDL) Yuan Ding Leasing Corp. (YDLC) Drive Catalyst SPC - SP Tranche One (Catalyst Tranche One) Drive Catalyst SPC - SP Tranche Three (Catalyst Tranche Three) Everstrong Iron & Steel Foundry Ltd. (EISF) Hubei Zhongjian Yadong Concrete Co., Ltd. (HZYCCL) Pao-Good Industry Co., Ltd. (PGIC) Opas Fund Segregated Portfolio Company (OFSPC) Drive Catalyst SPC (Catalyst) Perez-Mtec-ACC, LLC (PMA) Shih Hsin Storage & Transportation Co., Ltd. (SHSTC)		December 31	December 31
		2019 2018 $ 83,943,246 $ 78,499,814 468,994 346,462 $ 84,412,240 $ 78,846,276 December 31
		2019 $ 42,414,539 10,899,366 12,024,837 65,338,742 4,538,927 4,398,357 3,031,722 2,560,533 1,921,049 669,788 640,867 373,481 120,649 118,975 97,282 79,282 51,455 1,607 488 42 - 18,604,504 $ 83,943,246	2018 $ 43,204,676 10,394,553 10,217,370 63,816,599 4,602,067 4,200,160 - 1,939,588 1,877,359 648,674 617,872 368,032 122,662 - 99,473 74,013 60,232 1,610 493 43 70,937 14,683,215 $ 78,499,814

42 -

At the end of the reporting period, the percentages of owners’ voting rights in associates held by the Group were as follows:

Name of Associate FENC U-Ming CSCGL YDC FEC YDES YYI OSC YDEC FEDSDL YDLC Catalyst Tranche One Catalyst Tranche Three EISF HZYCCL PGIC OFSPC Catalyst PMA SHSTC	December 31
	2019 2018 25.74% 25.74% 41.41% 41.41% 17.46% 17.46% 49.99% 49.99% 33.76% 33.76% 40.00% - 29.92% 29.92% 18.93% 18.93% 30.84% 30.84% 25.00% 25.00% 43.60% 43.60% 25.00% 25.00% 25.00% - 48.73% 48.73% 40.00% 40.00% 31.00% 31.00% 33.00% 33.00% 33.00% 33.00% 33.00% 33.33% - 28.91%

DCI, the Corporation’s subsidiary, subscribed for 4,000 shares of Catalyst Tranche One for US$4,000 thousand in December 2018. After the subscription, DCI owned 25% of the shares of Catalyst Tranche One.

DCI, the Corporation’s subsidiary, subscribed for 4,000 shares of Catalyst Tranche Three for US$4,000 thousand in October 2019. After the subscription, DCI owned 25% of the shares of Catalyst Tranche Three.

Due to the liquidation of SHSTC in 2019, DCI and NHC, the Corporation’s subsidiary, recovered its investments and recognized losses from disposal of $63,008 thousand and $5,761 thousand, respectively.

As described in Note 12, ACCHC, the Corporation’s subsidiary, subscribed for YDES’s cash capital increase for RMB714,190 thousand YDES’s new shares through its subsidiary OHC; after the subscription, ACCHC’s percentage of ownership in YDES was 40%.

As of December 31, 2019 and 2018, the information of associates was as follows:

1) Fair values (Level 1) of investments in associates with available published price quotation are summarized as follows:

Name of Associate FENC U-Ming CSCGL		December 31	December 31
		2019 $ 41,124,212 $ 11,757,137 $ 8,855,602	2018 $ 38,437,706 $ 11,284,752 $ 6,241,835

43 -
2) The summarized financial information in respect of the Group’s material associates is set out below:

FENC:

	December 31	December 31
2019 2018 $ 31,823,888 $ 31,423,092 297,297,715 285,607,062 24,007,226 23,339,671 100,592,089 90,155,346 204,522,288 203,535,137 25.74% 25.74% 52,644,037 52,389,944 (10,229,498) (9,185,268) $ 42,414,539 $ 43,204,676 For the Year Ended December 31
	2019 2018 $ 46,477,960 $ 54,063,801 $ 10,732,669 $ 12,028,294 (186,100) 855,093 $ 10,546,569 $ 12,883,387 $ 2,479,866 $ 1,653,235 December 31
	2019 $ 2,225,116 49,594,962 11,281,141 13,694,378 26,844,559 41.41% 11,116,333 (87,524) (129,443) $ 10,899,366	2018 $ 1,985,037 50,008,362 17,453,879 8,913,985 25,625,535 41.41% 10,611,534 (87,523) (129,458) $ 10,394,553

44 -

For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
	2019 2018 $ 1,062,972 $ 1,080,444 $ 1,621,695 $ 1,668,840 1,118,819 2,007,257 $ 2,740,514 $ 3,676,097 $ 618,330 $ 419,898 December 31
2019 2018 $ 26,673,504 $ 26,174,052 88,426,257 90,319,977 47,973,181 59,104,108 13,066,715 14,557,750 442,928 286,348 53,616,937 42,545,823 17.46% 17.46% 9,416,541 7,427,489 1,856,015 1,856,015 752,281 933,866 $ 12,024,837 $ 10,217,370 For the Year Ended December 31
	2019 $ 96,302,852 $ 13,578,105 8,286 $ 13,586,391	2018 $ 80,162,793 $ 9,856,967 (1,082,166) $ 8,774,801

As described in Note 8, the Group’s investments in CSCGL were reclassified from financial assets at fair value through other comprehensive income to investments accounted for using equity method in 2018.

3) Aggregate information of associates that are not individually material:

The Group’s share of: Profit for the year Other comprehensive income Total comprehensive income for the year	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 687,961 365,142 $ 1,053,103	2018 $ 520,731 220,999 $ 741,730

45 -
4) The amounts of investments in associates pledged as collateral for bank borrowings are disclosed in Note 38.
b. Investments in joint ventures that are not individually material:

Investments in joint ventures that are not individually material:
Unlisted companies Alliance Concrete Singapore Pte. Ltd. (Alliance) Wuhan Asia Marine Transport Co., Ltd. (WAMTC) Hubei Xinlongyuan Mining Co., Ltd. (HXMC) Empire Success Corp. Ltd. (ESC) Profit Enterprises Int’l Ltd. (PEI)		December 31
		2019 $ 206,833 201,735 40,629 16,508 3,289 $ 468,994	2018 $ 107,842 195,115 24,020 17,371 2,114 $ 346,462

At the end of the reporting period, the percentages of owners’ voting rights in joint ventures held by the Group were as follows:

Name of Joint Ventures Alliance WAMTC HXMC ESC PEI	December 31
	2019 2018 50.00% 50.00% 50.00% 50.00% 40.00% 40.00% 50.00% 50.00% 50.00% 50.00%

Aggregate information of joint ventures that are not individually material:

The Group’s share of: Income for the year Other comprehensive income Total comprehensive income for the year	For the Year Ended	For the Year Ended	December 31
		2019 $ 145,736 - $ 145,736	2018 $ 19,089 - $ 19,089

All the associates and joint ventures are accounted for using equity method.

For the years ended December 31, 2018, impairment loss on individually not material joint ventures amounted to $200,245 thousand, was recognized in profit or loss.

Refer to Table 7 “Information on Investees” and Table 8 “Information on Investments in Mainland China” for the nature of activities, principal place of business and country of incorporation of the associates and joint ventures.

46 -

16. PROPERTY, PLANT AND EQUIPMENT

a. Assets used by the Group - 2019

Cost Balance at January 1, 2019 Additions Disposals Transferred from supplies Transferred to intangible assets Transferred from completed construction Transferred from prepayments for leases Effect of foreign currency exchange differences Balance at December 31, 2019 Accumulated depreciation and impairment Balance at January 1, 2019 Depreciation expense Disposals Transferred from supplies Effect of foreign currency exchange differences Balance at December 31, 2019 Carrying amounts at December 31, 2019	Land $ 6,592,017 - - - - - - - 6,592,017 12,595 - - - - 12,595 $ 6,579,422	Buildings $ 24,647,228 6,315 (61,376 ) - - 310,159 - (740,764) 24,161,562 9,710,242 635,628 (33,166 ) - (217,059) 10,095,645 $ 14,065,917	Equipment O $ 75,252,256 87,409 (468,773 ) 16,141 - 725,892 - (2,125,141) 73,487,784 49,670,369 3,146,778 (431,123 ) 16,141 (1,296,585) 51,105,580 $ 22,382,204	ther Equipment Property Under Construction $ 12,233,576 $ 3,260,791 272,718 3,614,732 (376,656 ) - 56,531 - - (2,363 ) 258,817 (1,294,868 ) 27,626 - (125,566) (8,920) 12,347,046 5,569,372 10,043,321 - 660,987 - (360,583 ) - - - (81,045) - 10,262,680 - $ 2,084,366 $ 5,569,372	Total $ 121,985,868 3,981,174 (906,805 ) 72,672 (2,363 ) - 27,626 (3,000,391) 122,157,781 69,436,527 4,443,393 (824,872 ) 16,141 (1,594,689 ) 71,476,500 $ 50,681,281

The above items of property, plant and equipment are depreciated on a fixed-percentage-on-decliningbalance basis or on a straight-line basis over the estimated useful life of the asset taken apart into major component elements:

Building Main buildings 15-60 years Other facilities 2-15 years Equipment 2-20 years Other equipment 2-20 years

As of December 31, 2019, the titles of land with carrying value of $88,718 thousand were temporarily registered in the name of trustees who had either signed an agreement or had pledged the land to the Corporation or to the subsidiaries.

Refer to Note 38 for the carrying amount of property, plant and equipment pledged by the Group as collaterals for borrowings.

47 -

b. 2018

Cost Balance at January 1, 2018 Additions Disposals Disposal of subsidiary Transferred to supplies Transferred to intangible assets Transferred to other assets Transferred from investment properties to property, plant and equipment Transferred from completed construction Reclassifications Others Effect of foreign currency exchange differences Balance at December 31, 2018 Accumulated depreciation and impairment Balance at January 1, 2018 Depreciation expense Disposals Disposal of subsidiary Impairment loss recognized Transferred to intangible assets Transferred to other assets Reclassifications Effect of foreign currency exchange differences Balance at December 31, 2018 Carrying amounts at December 31, 2018	Land $ 6,591,954 63 - - - - - - - - - - 6,592,017 12,595 - - - - - - - - 12,595 $ 6,579,422	Buildings $ 24,940,297 11,061 (137,449 ) (17,215 ) - - - 22,270 153,845 - - (325,581) 24,647,228 9,247,376 640,439 (97,604 ) (14,074 ) 18,365 - - - (84,260) 9,710,242 $ 14,936,986	Equipment O $ 76,074,327 324,480 (360,313 ) (45,449 ) - - - - 131,726 57,159 - (929,674) 75,252,256 47,223,741 3,308,785 (317,576 ) (40,833 ) 32,341 - - (15,680 ) (520,409) 49,670,369 $ 25,581,887	ther Equipment Property Under Construction $ 12,716,754 $ 191,440 493,934 3,499,440 (956,539 ) - (617 ) - (37,670 ) - (577 ) (1,333 ) (15,622 ) - - - 138,943 (424,514 ) (57,159 ) - - (156 ) (47,871) (4,086) 12,233,576 3,260,791 10,292,222 - 700,337 - (915,271 ) - (555 ) - 1,182 - (577 ) - (15,622 ) - 15,680 - (34,075) - 10,043,321 - $ 2,190,255 $ 3,260,791	Total $ 120,514,772 4,328,978 (1,454,301 ) (63,281 ) (37,670 ) (1,910 ) (15,622 ) 22,270 - - (156 ) (1,307,212) 121,985,868 66,775,934 4,649,561 (1,330,451 ) (55,462 ) 51,888 (577 ) (15,622 ) - (638,744) 69,436,527 $ 52,549,341

Building Main buildings 15-60 years Other facilities 2-15 years Equipment 2-20 years Other equipment 2-20 years

As of December 31, 2018, the titles of land with carrying value of $88,655 thousand were temporarily registered in the name of trustees who had either signed an agreement or had pledged the land to the Corporation or to the subsidiaries.

Refer to Note 38 for the carrying amount of property, plant and equipment pledged by the Group as collaterals for borrowings.

48 -

17. LEASE ARRANGEMENTS

a. Right-of-use assets - 2019

Right-of-use assets - 2019
	December 31,
		2019
Carrying amounts
Land	$	3,585,342
Buildings		890,167
Equipment		604,778
	$	5,080,287
	For the Year
		Ended
	December 31,
		2019
Additions to right-of-use assets	$	434,029
Depreciation charge for right-of-use assets
Land	$	141,027
Buildings		95,394
Equipment		147,604
	$	384,025
Lease liabilities - 2019
	December 31,
		2019
Carrying amounts
Current	$	190,607
Non-current	$	1,264,765
Range of discount rate for lease liabilities was as follows:
	December 31,
		2019
Land	1.06%-3.50%
Buildings	1.30%-4.90%
Equipment	1.17%-13.50%

b. Lease liabilities - 2019
c. Material lease-in activities and terms

The Group leases harbors, land, buildings and equipment for the use in business operations and has obtained land use rights in mainland China, Hong Kong, Singapore and Vietnam. Certain lease contracts specify that lease payment will be adjusted on the basis of changes in market rental rates or announced land value prices. The Group does not have bargain purchase options to acquire the leasehold assets at the end of the lease terms.

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d. Other lease information

Lease arrangements under operating leases for the leasing out of investment properties are set out in Note 18. Lease arrangements for the leasing out of assets under finance leases are set out in Note 11.

2019

2019
	For the Year
		Ended
	December 31,
		2019
Expenses relating to short-term leases	$	269,676
Expenses relating to low-value asset leases	$	890
Expenses relating to variable lease payments not included in the measurement of
lease liabilities	$	148,475
Total cash outflow for leases	$	(686,833)

The Group has elected to apply the recognition exemption and, thus, did not recognize right-of-use assets and lease liabilities for these leases.

2018

The future minimum lease payments of non-cancellable operating lease commitments are as follows:

	December 31,	December 31,
		2018
Not later than 1 year	$	355,724
Later than 1 year and not later than 5 years		805,922
Later than 5 years		2,604,106
	$	3,765,752

The Group’s rent expenses on the above operating lease contracts were $408,049 thousand for the year ended December 31, 2018.

18. INVESTMENT PROPERTIES

INVESTMENT PROPERTIES
Measured at fair value Leased investment property Undeveloped investment property		December 31
		2019 $ 29,867,028 6,309,411 $ 36,176,439	2018 $ 29,481,076 6,484,127 $ 35,965,203

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Balance at January 1, 2018 Additions Accounts receivable write-offs Transferred to property, plant and equipment Changes in fair value of investment properties Effect of foreign currency exchange difference Balance at December 31, 2018 Balance at January 1, 2019 Additions Changes in fair value of investment properties Effect of foreign currency exchange difference Balance at December 31, 2019	Leased Investment Property $ 29,352,403 1,269 - - 128,575 (1,171) $ 29,481,076 $ 29,481,076 24,834 363,361 (2,243) $ 29,867,028	Undeveloped Investment Property $ 6,393,008 - 149,528 (22,270) (30,560) (5,579) $ 6,484,127 $ 6,484,127 2,390 (165,714) (11,392) $ 6,309,411	Total $ 35,745,411 1,269 149,528 (22,270) 98,015 (6,750) $ 35,965,203 $ 35,965,203 27,224 197,647 (13,635) $ 36,176,439

The investment properties for lease were as follows:

a. On January 1, 1998, the Corporation granted FEDSDL the right to construct a shopping center on a parcel of land it owned with an area of 6,976 square meters located in Lin-Ya, Kaohsiung. As consideration for the right to construct and the continued use of the land for fifty years, FEDSDL shall pay the following: (a) land use rights in the amount of $1,073,000 thousand and (b) annual rental at 5% of the reference price of such land announced by the local government. The proceeds of the land use rights were recorded as long-term deferred revenue and recognized as rental revenue on a periodic basis.
b. The Corporation and Far Eastern Resources Development Co. (FERD) equally owned a parcel of land located at Tun Hwa South Road, Taipei City. Under an agreement entered into with YDC, the Corporation and FERD had agreed on the following: (a) construction of a twin tower building (Taipei Metro) by YDC on the said land, (b) continued use of the land without additional compensation for 30 years starting from the date of the completion of the building, (c) transfer to each of the Corporation and FERD 12% of the usable area of the building, and (d) transfer to FERD and the Corporation the remaining usable area of the building after the end of 30 years in exchange for the carrying amount of the property. In view of the foregoing agreement, the Corporation recorded the 12% of the building construction cost or $1,402,753 thousand as building acquired and as long-term deferred revenue, and recognized as revenue on a periodic basis.
c. SYDCCL signed a contract with Mie Business Services Co., Ltd. (Mie Business). The contract fully authorized Mie Business to manage and operate SYDCCL’s store located in area A of Guosetianxiang Second-Stage in Wenjiang District of Chengdu City, with an area of 932.49 square meters. The contract started from May 1, 2017 and will end on March 31, 2022.
d. The Corporation also has lease contract for Asia-Cement Building and Pao-Ching Building, as well as land and building located in Chiayi City and Wuhan. These investment properties are leased out for 1 to 10 years with monthly lease payments.

The Group’s undeveloped investment properties included a parcel of land located in Lin-Ya, Kaohsiung, as well as stores, apartments, and office buildings acquired by SIYDCCL and HYDCCL as collaterals for overdue balances from customers.

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The fair values of investment properties were valued by independent qualified professional appraisers. According to local requirements, entities are required to have independent appraisal for the investment properties with individual carrying amount of $300 million or higher. The fair values of investment properties as of December 31, 2019 and 2018 were determined by qualified professional appraisers, Mr. Chang from Savills (Taiwan) Limited and Mr. Tsai from DTZ real estate appraisers firm on March 4, 2020 and March 4, 2019, respectively.

The fair value of investment properties was estimated using unobservable inputs (Level 3). The movements in the fair value were as follows:

Balance at January 1, 2018 Recognized in profit or loss (gain or loss from changes in fair value of investment property) Recognized in other comprehensive income Exchange differences on translating the financial statements of foreign operations Purchases Transfers into Level 3 Transfers out of Level 3 Balance at December 31, 2018 Balance at January 1, 2019 Recognized in profit or loss (gain or loss from changes in fair value of investment property) Recognized in other comprehensive income Exchange differences on translating the financial statements of foreign operations Purchases Balance at December 31, 2019	Completed Investment Property Investment Property under Construction $ 29,352,403 $ 6,393,008 128,575 (30,560) (1,171) (5,579) 1,269 - - 149,528 - (22,270) $ 29,481,076 $ 6,484,127 $ 29,481,076 $ 6,484,127 363,361 (165,714) (2,243) (11,392) 24,834 2,390 $ 29,867,028 $ 6,309,411	Total $ 35,745,411 98,015 (6,750) 1,269 149,528 (22,270) $ 35,965,203 $ 35,965,203 197,647 (13,635) 27,224 $ 36,176,439

The fair value measurement of undeveloped land located in Lin-Ya, Kaohsiung, was measured by land development analysis. The increase in estimated total selling price, the increase in rate of return, or the decrease in overall capital interest rate would result in an increase in the fair value. The significant assumptions used were as follows:

Estimated total selling price Rate of return Overall capital interest rate		December 31	December 31
		2019 $ 19,379,643 22% 5.99%	2018 $ 18,991,547 22% 6.08%

The total selling price is estimated on the basis of the most effective use of the land or property available for sale after development is completed, taking into account the related regulations, domestic macroeconomic prospects, local land use, and market rates.

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The fair value of investment properties, except for undeveloped land, was measured using the income approach. The significant assumptions used were stated below. The increase in estimated future net cash inflows or the decrease in discount rates would result in increase in the fair value.

Expected future cash inflows Expected future cash outflows Expected future cash inflows, net Discount rate		December 31	December 31
		2019 $ 36,224,173 1,517,032 $ 34,707,141 2.07%-6.25%	2018 $ 35,860,267 1,499,390 $ 34,360,877 2.07%-6.25%

The market rentals in the area where the investment property is located were between $1 thousand and $5 thousand per ping (i.e., per 3.3 square meters).

The rental income generated for the years ended December 31, 2019 and 2018 was $352,671 thousand and $342,591 thousand, respectively.

The expected future cash inflows to be generated by investment properties include rental income, interest income on rental deposits and disposal value. The rental income was extrapolated using the Group’s current rental contract, regional and market quotation, taking into account the annual rental growth rate; the income analysis covers a 10-year period, the interest income on rental deposits was extrapolated using the interest rate for one-year central bank-announced demand deposit interest rate; the disposal value was determined using the direct capitalization method under the income approach. The expected future cash outflows to be incurred by investment properties include expenditure such as land value taxes, house taxes, insurance premium, maintenance costs and others. This expenditure was extrapolated on the basis of the current level of expenditure, taking into account the future adjustment to the government-announced land value, and the tax rate promulgated under the House Tax Act.

The discount rate was determined by reference to the interest rate for two-year time deposits as posted by Chunghwa Post Co., Ltd., plus 0.75%, or estimated income capitalization rate, whichever is higher, as well as any asset-specific risk premiums. As of December 31, 2019 and 2018, the risk premiums were both 0.225%-4.50%.

Refer to Note 38 for the carrying amount of investment properties pledged by the Group as collaterals for borrowings.

19. INTANGIBLE ASSETS - GOODWILL

Cost Balance at January 1 Impairment losses recognized Effect of foreign currency exchange differences Balance at December 31	2019 $ 2,497,148 - (98,504) $ 2,398,644	2018 $ 3,171,735 (630,631) (43,956) $ 2,497,148

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The goodwill comprised of the following:

a. In July 2010, HYDCCL acquired 70% ownership of WYXC. The investment cost in excess of the fair value of net identifiable assets of the investee was the amount of goodwill, which was RMB138,759 thousand. The recoverable amount of the cash generating unit were lower than the related carrying amount, and impairment loss of RMB138,759 thousand were recognized for the year ended December 31, 2018.
b. In April 2014, SYDCCL acquired 100% ownership of SLCL. The investment cost in excess of the fair value of net identifiable assets of the investee was the amount of goodwill, which was RMB554,241 thousand.
c. On December 31, 2014, the Corporation acquired control power over YLT. The investment cost in excess of the fair value of net identifiable assets of the investee was the amount of goodwill, which was $20,780 thousand.

As of December 31, 2019, the Group assessed that there was no indication of impairment on the cash-generating units including the goodwill listed above.

20. INTANGIBLE ASSETS - OTHERS

Quarry Right Cost Balance at January 1, 2018 $ 1,734,896 Additions - Disposals - Transferred from completed construction - Effect of foreign currency exchange differences (28,227) Balance at December 31, 2018 1,706,669 Accumulated amortization and impairment Balance at January 1, 2018 711,637 Amortization expense 171,621 Disposals - Effect of foreign currency exchange differences (15,232) Balance at December 31, 2018 868,026 Carrying amounts at December 31, 2018 $ 838,643	Computer Software $ 246,703 13,037 (379) 1,333 (1,346) 259,348 217,219 11,292 (379) (1,036) 227,096 $ 32,252	Others $ 419,776 - - - (1,619) 418,157 91,693 1,336 - (1,612) 91,417 $ 326,740	Total $ 2,401,375 13,037 (379) 1,333 (31,192) 2,384,174 1,020,549 184,249 (379) (17,880) 1,186,539 $ 1,197,635

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Quarry Right Cost Balance at January 1, 2019 $ 1,706,669 Additions 49,836 Disposals - Accruals 4,820,027 Transferred from completed construction - Effect of foreign currency exchange differences (273,628) Balance at December 31, 2019 6,302,904 Accumulated amortization and impairment Balance at January 1, 2019 868,026 Amortization expense 1,279,440 Disposals - Effect of foreign currency exchange differences (89,688) Balance at December 31, 2019 2,057,778 Carrying amounts at December 31, 2019 $ 4,245,126	Computer Software $ 259,348 9,105 (937) - 2,363 (3,174) 266,705 227,096 12,846 (937) (2,546) 236,459 $ 30,246	Others $ 418,157 - - - - (3,655) 414,502 91,417 439 - (3,655) 88,201 $ 326,301	Total $ 2,384,174 58,941 (937) 4,820,027 2,363 (280,457) 6,984,111 1,186,539 1,292,725 (937) (95,889) 2,382,438 $ 4,601,673

The above items of other intangible assets with finite useful lives are amortized on a straight-line basis. Quarry rights are amortized over 40 to 47 years and the computer software and others are amortized over 2 to 6 years. The other items with indefinite useful lives will not be amortized until their useful lives are determined to be finite. Instead, they will be tested for impairment annually and whenever there is an indication that they may be impaired.

According to the Plan for the Reform of the Mineral Resource Royalty System issued by the State Council of the People's Republic of China, proceeds from prospecting and mining rights shall be changed into proceeds from assignment of mining rights and shall be determined according to valuation and benchmark market prices under similar conditions, whichever is higher. The proceeds from the transfer of mining rights shall be determined at one time and paid in the form of monetary funds. The specific measures for payment shall be developed separately by the Ministry of Finance in conjunction with the Ministry of Land and Resources.

In 2019, the Group finalized the independent valuer report in accordance with the aforementioned reform plans on the mine reserves and the estimated amount of the provision of mine reserve fund was RMB1,075,031 thousand, which was capitalized into the cost of quarry. In addition, the Group was required to accrue an amount of RMB275,076 thousand as cost of production of mine, which represented the amount of mine excavated times the agreed amount of unit cost for the current and past years, and such amount was charged to the cost of sales of the Group for the year ended December 31, 2019. As of the balance sheet date, the mine reserve fund of RMB1,075,031 thousand was accounted for as accounts payable and accrued expenses - third parties since the actual payment date and amounts have not yet been finalized with the local government.

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21. PREPAYMENTS FOR LEASES

PREPAYMENTS FOR LEASES
	December 31,
		2018
Current assets (included in prepayments line item)	$	142,246
Non-current assets		3,779,353
	$	3,921,599

The above prepayments for leases include land use rights in mainland China, Hong Kong, Singapore and Vietnam. The amortization expense is $85,382 thousand for the year ended December 31, 2018.

22. OTHER NON-CURRENT ASSETS

OTHER NON-CURRENT ASSETS
Prepaid investments Net defined benefit assets Refundable deposits Others Refundable deposits Current (accounted for as other current assets) Non-current		December 31
		2019 $ 1,437,673 2,536,388 328,403 9,420 $ 4,311,884 $ 71,424 $ 328,403	2018 $ 2,042,722 1,898,029 914,114 9,693 $ 4,864,558 $ 82,493 $ 914,114

The prepaid investments comprised of the following:

a. On March 23, 2017, the Corporation acquired 155 thousand issued shares of China Shanshui Investment Company Limited (CSI) in the amount of HK$577,662 thousand from six shareholders of CSI under a share purchase agreement. The Corporation already obtained the physical share certificates of the acquired CSI shares. Pursuant to the Articles of Association of CSI, the share ownership can only be recorded on the register of shareholders if the board of directors of CSI approves the share transfer. The Corporation submitted all necessary documents to CSI for registration of the share transfer. However, CSCGL and its subsidiaries obtained from the High Court of Hong Kong an injunction order by way of an ex-parte application on April 11, 2017. Pursuant to the injunction order, four out of the abovementioned six shareholders, Mi Jingtian, Zhao Liping, Li Maohuan and Yu Yuchuan, are prohibited from removing any of their assets in Hong Kong. Each of their assets’ value is up to RMB142 million (or its Hong Kong dollar equivalent), in particular, their shares in CSI and/or any proceeds from sales of any such CSI shares. The Corporation is neither a plaintiff nor a defendant in the aforesaid proceedings. But, for the purpose of securing and exercising the rights and interests of the acquired shares of CSI, the Corporation provided a bank guarantee of RMB142 million to the High Court of Hong Kong according to the High Court’s ruling on April 21, 2017. On the same day, the High Court of Hong Kong lifted the injunction order on the shares of CSI acquired by the Corporation. Since the payment liability event as agreed in the bank guarantee did not occur before due date and the bank guarantee expired on April 21, 2019, the Corporation’s obligations were terminated on the same day.
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In addition, Chan Hongqing, a PRC individual, claimed that the CSI shares which the Corporation acquired from the abovementioned four shareholders were pledged as collaterals under a loan contract signed on August 17, 2015 with him and thus applied for arbitration with China International Economic and Trade Arbitration Commission in Beijing. Later, by an order of the High Court of Hong Kong on June 27, 2017, it requested the appointment of interim receivers in respect of the CSI shares held by the four shareholders until the end of the arbitral proceedings. On May 17, 2018, the High Court of Hong Kong set aside the order before the final award of the arbitration. The arbitral proceeding was therefore terminated on June 12, 2018.

On October 2, 2018, Chan Hongqing applied to the High Court of Hong Kong for interlocutory relief in another proceedings against the Corporation to prohibit the Corporation and the abovementioned four CSI shareholders from transferring and registering their CSI shares. Then his application for interlocutory relief was dismissed by the High Court of Hong Kong. The Corporation engaged lawyers to proactively liaise with the board of directors of CSI in connection with the registration of the share transfer.

As for the shares acquired from the other two CSI shareholders, Dong Chengtian and Wang Yongping, Chan Hongqing also claimed that the CSI shares held by the two shareholders were pledged as collaterals under the same loan contract mentioned above. As a result, the board of directors of CSI refused to approve the share transfer. Later, as the Corporation filed a lawsuit to the High Court of Hong Kong against CSI, the board of directors of CSI finally approved the share transfer. The registration of the CSI shares acquired from the two shareholders, Dong Chengtian and Wang Yongping, were completed and the prepaid investments in the balance sheets was therefore reclassified to financial assets at fair value through other comprehensive income - non-current. Refer to Note 8.

b. Chu Feng Power Corporation, Preparatory Office (Chu Feng), founded in October 2016, was created by DCI, the Corporation’s subsidiary, for the development of offshore wind power in Taiwan. As of December 31, 2019 and 2018, the accumulated prepaid investments were $142,768 thousand and $131,544 thousand, respectively. In March 2018, Chu Feng submitted an application to the Bureau of Energy, Ministry of Economic Affairs, ROC, for the offshore wind power project’s selection. However, Chu Feng did not pass the selection according to the announcement on April 30, 2018. In June 2018, Chu Feng joined the second stage auction and its bid failed again. Later, on March 25, 2020, DCI’s board of directors resolved to enter into a bidding contract (including the final version of the joint venture contract) with Innogy Renewables Beteiligungs GmbH Company. As of the balance sheet date, the Group recognized the amounts paid within the preparatory period as other receivables or prepaid investments. The Group also recognized full amounts of provisions based on the preparatory loss of Chu Feng. Refer to Note 28.

23. SHORT-TERM BORROWINGS

SHORT-TERM BORROWINGS
Unsecured Secured Interest rate (%) Final repayment date: Unsecured Secured		December 31
		2019 $ 22,211,603 1,600,000 $ 23,811,603 0.95-3.79 2020.12.24 2020.2.19	2018 $ 23,099,239 1,706,000 $ 24,805,239 1.04-5.30 2019.10.31 2019.3.26

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24. SHORT-TERM BILLS PAYABLE

SHORT-TERM BILLS PAYABLE
Commercial paper Less: Unamortized discounts on bills payable Interest rate (%)		December 31
		2019 $ 18,938,500 6,206 $ 18,932,294 0.38%-1.3%	2018 $ 18,569,425 4,956 $ 18,564,469 0.36%-1.26%

Short-term bills payable were issued under guarantee obtained from financial institutions.

25. OTHER PAYABLES

OTHER PAYABLES
Payable on investment		December 31
		2019 $ 312,069	2018 $ 334,305

Payable on investment is the unpaid consideration for SIYDCCL’s acquisition of SLCL, which amounted to RMB72,738 thousand.

26. LONG-TERM LIABILITIES

LONG-TERM LIABILITIES
Bank loans Long-term commercial paper Less: Unamortized discounts Bonds Domestic bonds 1stunsecured bonds issued in 2014 1stunsecured bonds issued in 2016 1stunsecured bonds issued in 2019 2ndunsecured bonds issued in 2019 Overseas bonds 3rdEuro convertible bonds issued in 2018 - US$215,000 thousand Less: Current portion		December 31
		2019 $ 30,972,304 - - 30,972,304 - 6,000,000 6,500,000 3,500,000 16,000,000 6,280,808 53,253,112 13,151,315 $ 40,101,797	2018 $ 31,886,897 5,000,000 7,989 36,878,908 4,000,000 6,000,000 - - 10,000,000 6,192,567 53,071,475 7,285,012 $ 45,786,463

a. Bank loans are repayable in installments at varying amounts or in one lump-sum payment prior to April 3, 2039. The Group has signed long-term revolving credit facilities with banks. As of December 31, 2019 and 2018, interest rates were 0.89%-6.75% and 0.89%-5.58%, respectively.
b. Long-term commercial paper was issued by contract. As of December 31, 2018, interest rates were 0.83%-0.84%. The maturity date of the contract is December 19, 2020.
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c. Domestic bonds are repayable in installments at varying amounts or in one lump-sum on maturity prior to August 16, 2024. As of December 31, 2019 and 2018, interest rates were 0.79%-0.88% and 0.80%-1.36%, respectively.
d. In order to redeem bonds and pay interest expenses, on May 13, 2013, the Corporation issued 2[nd] US$220,000 thousand (equivalent to NT$6,551,380 thousand) zero coupon Euro convertible bonds due 2018.

The terms of the zero coupon Euro convertible bonds included the following:

1) Final redemption

Unless previously redeemed, repurchased and cancelled, or converted, the bonds will be redeemed on the maturity date at a redemption price equal to 100% of the unpaid principal amount thereof.

2) The bonds are convertible into the Corporation’s ordinary shares (“Shares”) at any time on or after June 23, 2013 and prior to the close of business on April 13, 2018. The initial conversion price was NT$48 per Share, determined on the basis of a fixed exchange rate of NT$29.53=US$1.00.
3) Redemption at the option of the Corporation

At any time on or after May 13, 2016, the Corporation may redeem the bonds in whole, or from time to time in part, at the early redemption amount, if the closing price of the Shares, translated into U.S. dollars at the prevailing rate, during a period of 30 consecutive trading days, is at least 130% of the quotient of the early redemption amount divided by the number of Shares to be issued upon conversion of US$200,000 principal amount of bonds on the applicable trading day based on the conversion price then in effect, translated into U.S. dollars at a fixed exchange rate of NT$29.53=US$1.00. Notwithstanding the foregoing, at any time, the Corporation may redeem the bonds in whole, but not in part, at the early redemption amount in U.S. dollars if at least 90% in principal amount of the bonds has already been redeemed, repurchased and cancelled, or converted.

4) Redemption at the option of the bondholders

Unless previously redeemed, repurchased and cancelled or converted, each holder will have the right to require the Corporation to redeem in whole or in part of the bonds held by such holder on May 13, 2016 at a redemption price equal to 100% of the principal amount thereof. (Refer to item 6 below for information on the redemption of bonds.)

5) The conversion price shall be subject to adjustment when there is occurrence of, including (but not limited to), the following:
a) Declaration of dividend in Shares or free distribution or bonus issue of Shares.
b) Subdivision, consolidation and reclassification of Shares.
c) Rights issues to shareholders.
d) Employee share bonus.
e) Warrants issued to holders of Shares.
f) Issues of rights or warrants for equity-related securities to holders of Shares.
g) Capital distributions, other distributions to shareholders.
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- h) Issue of convertible or exchangeable securities other than to holders of Shares or on exercise of warrants.
- i) Other issues of Shares.
- j) Issue of equity related securities.
- k) Capital reduction.
- l) Tender or exchange offer.
- m) Any other event or circumstance which would have an effect analogous to any of the events in a) to l) above.
6) As bondholders exercised the put option, the Corporation had redeemed the principal amount of US$217,000 thousand on May 11, 2016. After the redemption, the bonds outstanding in the amount of US$3,000 thousand had been paid on May 10, 2018.
e. In order to repay the debt, save interest expenses, and strengthen the Corporation’s financial structure, on September 21, 2018, the Corporation issued US$215,000 thousand (equivalent to NT$6,620,710 thousand), which is the third zero coupon Euro convertible bond due on 2023.

The terms of the zero coupon Euro convertible bonds included the following:

1) Final redemption

Unless previously redeemed, repurchased and canceled, or converted, the Bonds will be redeemed on the maturity date at the settlement equivalent of 103.04% of the unpaid principal amount thereof.

2) The bonds are convertible into the Corporation’s ordinary shares (“Shares”) at any time on or after December 21, 2018 and prior to the close of business on August 22, 2023. The initial conversion price was NT$42.24 per Share, determined on the basis of a fixed exchange rate of NT$30.794=US$1.00.
3) Redemption at the option of the Corporation

At any time on or after September 21, 2021, the Corporation may redeem the bonds in whole, or from time to time in part, at the early redemption amount, if the closing price of the Shares, translated into U.S. dollars at the prevailing rate, during a period of 30 consecutive trading days, is at least 130% of the quotient of the early redemption amount divided by the number of Shares to be issued upon conversion of US$200,000 principal amount of the bonds on the applicable trading day based on the conversion price then in effect, translated into U.S. dollars at a fixed exchange rate of NT$30.794=US$1.00. Notwithstanding the foregoing, at any time, the Corporation may redeem the bonds in whole, but not in part, at the early redemption amount in U.S. dollars if at least 90% in principal amount of the bonds has already been redeemed, repurchased and cancelled, or converted.

4) Redemption at the option of the bondholders

Unless previously redeemed, repurchased and cancelled or converted, each holder will have the right to require the Corporation to redeem in whole or in part of the bonds held by such holder on September 21, 2021 at a redemption price equal to the settlement equivalent of 101.81% of the principal amount in U.S. dollars. Any U.S. dollar denominated amount payable in respect of the bonds will be converted into NT dollars using a fixed exchange rate and then converted back to a U.S. dollar amount using the applicable prevailing rate at the time of redemption.

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5) The conversion price shall be subject to adjustment when there is occurrence of, including (but not limited to), the following:
- a) Declaration of dividend in Shares or free distribution or bonus issue of Shares.
- b) Subdivision, consolidation and reclassification of Shares.
- c) Rights issues to shareholders.
- d) Employee share bonus.
- e) Warrants issued to holders of Shares.
- f) Issues of rights or warrants for equity-related securities to holders of Shares.
- g) Capital distributions, other distributions to shareholders.
- h) Issue of convertible or exchangeable securities other than to holders of Shares or on exercise of warrants.
- i) Other issues of Shares.
- j) Issue of equity related securities.
- k) Capital reduction.
- l) Tender or exchange offer.
- m) Any other event or circumstance which would have an effect analogous to any of the events in a) to l) above. The conversion price was NT$39.7 as of December 31, 2019.
f. As of December 31, 2019, CHP had used its credit lines as follows:

		Amount		Contract
Loan Item	Category	(In Thousands)	Interest Rate	Period
A	Loan	NT$ 2,850,000	1.797	20 years

The financial commitment that should be maintained by CHP under the payment terms are as follows:

1) Debt ratio as of year-end (total debt divided by total equity);
a) Under 200% from 2019 to 2023.
b) Under 150% from 2024 to 2039.
2) Interest coverage ratio should be at least 150% from 2019 to 2039.

The above financial ratios are based on audited financial statements. Debt ratio and interest coverage ratio should be reviewed at least on annual basis.

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g. As of December 31, 2019, CHP had used its credit lines as follows:

	Amount	Interest Rate/
Bank	(In Thousands)	Guarantee Fee Rate (%)	Contract Period
Mizuho	NT$ 184,252	0.45	2019.09.18-2020.09.18
Mizuho	NT$ 275,000	0.45	2019.09.18-2020.09.18
Mizuho	US$ 4,470	0.45	2020.09.18-2020.09.18

27. DEFERRED REVENUE

DEFERRED REVENUE
Land use right Others Current Non-current		December 31
		2019 $ 790,753 133,052 $ 923,805 $ 75,912 847,893 $ 923,805	2018 $ 858,838 140,879 $ 999,717 $ 75,912 923,805 $ 999,717

a. The deferred revenue on land use rights in Lin-Ya, Kaohsiung granted to FEDSDL (Note 18) is amortized to income over 50 years on a straight-line basis.
b. The deferred revenue on land use rights of Taipei Metro granted to YDC (Note 18) is amortized to income over 30 years on a straight-line basis.

28. OTHER LIABILITIES

OTHER LIABILITIES
Preparatory costs provisions (Note 22) Decommissioning of electric factory provisions Accrued reward provisions Compensation of traffic accident provisions Other provisions (Note 39) Current Non-current		December 31
		2019 $ 263,015 217,942 130,172 134,324 20,640 $ 766,093 $ 50,661 715,432 $ 766,093	2018 $ 222,729 217,942 140,572 127,894 18,440 $ 727,577 $ 48,200 679,377 $ 727,577

62 -

29. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

The Corporation and the subsidiaries in the ROC adopted a pension plan under the Labor Pension Act (LPA), which is a state-managed defined contribution plan. Under the LPA, an entity makes monthly contributions to employees’ individual pension accounts at specific rate of monthly salaries and wages.

b. Defined benefit plans

The defined benefit plan adopted by the Corporation and domestic subsidiaries in accordance with the Labor Standards Law is operated by the government of the ROC. Pension benefits are calculated on the basis of the length of service and average monthly salaries of the six months or last month before retirement. The Corporation and domestic subsidiaries contribute amounts equal to 2%-15% of total monthly salaries and wages to a pension fund administered by the pension fund monitoring committee. Pension contributions are deposited in the Bank of Taiwan in the committee’s name. Before the end of each year, the Group assesses the balance in the pension fund. If the amount of the balance in the pension fund is inadequate to pay retirement benefits for employees who conform to retirement requirements in the next year, the Group is required to fund the difference in one appropriation that should be made before the end of March of the next year. The pension fund is managed by the Bureau of Labor Funds, Ministry of Labor (the “Bureau”); the Group has no right to influence the investment policy and strategy.

The amounts included in the consolidated balance sheets in respect of the Group’s defined benefit plans were as follows:

Present value of defined benefit obligation Fair value of plan assets Deficit (surplus) Net defined benefit liabilities (asset)		December 31	December 31
		2019 $ 1,296,487 (3,668,667) (2,372,180) $ (2,372,180)	2018 $ 1,322,473 (3,035,395) (1,712,922) $ (1,712,922)

Movements in net defined benefit liabilities (assets) were as follows:

	Present Value
	of the Defined		Net Defined
	Benefit	Fair Value of	Benefit
	Obligation	the Plan Assets	Liability (Asset)
Balance at January 1, 2018	$ 1,527,968	$ (2,860,286)	$ (1,332,318)
Service cost
Current service cost	19,607	-	19,607
Net interest expense (income)	17,492	(33,798)	(16,306)
Recognized in profit or loss	37,099	(33,798)	3,301
Remeasurement
Return on plan assets (excluding amounts
included in net interest)	-	(303,940)	(303,940)
Actuarial loss - changes in demographic
assumptions	259	-	259
			(Continued)

63 -

	Present Value	Present Value
	of	the Defined			Net Defined
		Benefit	Fair Value of			Benefit
	Obligation		the	Plan Assets	Liability (Asset)
Actuarial loss - changes in financial
assumptions	$	20,848	$	-	$	20,848
Actuarial loss - experience adjustments		(46,872)		-		(46,872)
Recognized in other comprehensive income		(25,765)		(303,940)		(329,705)
Contributions from the employer		-		(25,085)		(25,085)
Benefits paid		(216,873)		183,077		(33,796)
Others		44		4,637		4,681
Balance at December 31, 2018	$	1,322,473	$	(3,035,395)	$	(1,712,922)
Balance at January 1, 2019	$	1,322,473	$	(3,035,395)	$	(1,712,922)
Service cost
Current service cost		15,773		-		15,773
Net interest expense (income)		13,951		(32,999)		(19,048)
Recognized in profit or loss		29,724		(32,999)		(3,275)
Remeasurement
Return on plan assets (excluding amounts
included in net interest)		-		(674,330)		(674,330)
Actuarial loss - changes in demographic
assumptions		125		-		125
Actuarial loss - changes in financial
assumptions		17,531		-		17,531
Actuarial loss - experience adjustments		52,335		-		52,335
Recognized in other comprehensive income		69,991		(674,330)		(604,339)
Contributions from the employer		-		(18,447)		(18,447)
Benefits paid		(125,701)		91,676		(34,025)
Liabilities extinguished on settlement		-		828		828
Balance at December 31, 2019	$	1,296,487	$	(3,668,667)	$	(2,372,180)
						(Concluded)

Through the defined benefit plans under the Labor Standards Law, the Group is exposed to the following risks:

1) Investment risk: The plan assets are invested in domestic and foreign equity and debt securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau or under the mandated management. However, in accordance with relevant regulations, the return generated by plan assets should not be below the interest rate for a 2-year time deposit with local banks.
2) Interest risk: A decrease in the corporate bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the plan’s debt investments.
3) Salary risk: The present value of the defined benefit obligation is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the present value of the defined benefit obligation.
64 -

The actuarial valuations of the present value of the defined benefit obligation were carried out by qualified actuaries. The significant assumptions used for the purposes of the actuarial valuations were as follows:

follows:
Discount rate(s) Expected rate(s) of salary increase	December 31
	2019 2018 0.65%-1.15% 0.75%-1.40% 2.00%-2.50% 2.00%-2.50%

If possible reasonable change in each of the significant actuarial assumptions will occur and all other assumptions will remain constant, the present value of the defined benefit obligation would increase (decrease) as follows:

Discount rate(s) 0.25% increase 0.25% decrease Expected rate(s) of salary increase 1% increase 1% decrease		December 31	December 31
		2019 $ (27,702) $ 28,636 $ 126,052 $ (116,810)	2018 $ (30,402) $ 31,476 $ 139,268 $ (128,585)

The major categories of plan assets at the end of the reporting period are disclosed based on the information announced by the Bureau:

Equity instruments Deposited in financial institutions Others		December 31	December 31
		2019 82.07 9.86 8.07 100.00	2018 84.40 6.75 8.85 100.00

The sensitivity analysis presented above may not be representative of the actual change in the present value of the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

The expected contributions to the plan for the next year The average duration of the defined benefit obligation		December	31
	2019 2018 $ 10,954 $ 14,925 6.6-11.5 years 7-12.5 years

65 -

30. EQUITY

a. Share capital

Share capital
Number of shares authorized (in thousands) Shares authorized Number of shares issued and fully paid (in thousands) Shares issued		December 31
		2019 4,000,000 $ 40,000,000 3,361,447 $ 33,614,472	2018 4,000,000 $ 40,000,000 3,361,447 $ 33,614,472

Fully paid ordinary shares, which have a par value of $10, carry one vote per share and carry a right to dividends.

The total of 350,000 thousand and 10,000 thousand shares of the Corporation’s authorized shares are reserved for the issuance of convertible bonds and employee share option, respectively.

b. Capital surplus

May be used to offset a deficit, distributed as cash dividends, or transferred to share capital (1) Donation The difference between consideration received or paid and the carrying amount of the subsidiaries’ net assets during actual disposal or acquisition Change of capital surplus of associates and joint ventures accounted for using equity method (2) May be used to offset a deficit only Change of capital surplus of associates and joint ventures accounted for using equity method (3) May not be used for any purpose Share warrants Change of capital surplus of associates and joint ventures accounted for using equity method		December 31	December 31
		2019 $ 41,790 54,907 992,530 1,089,227 128,141 185,411 53,275 238,686 $ 1,456,054	2018 $ 41,790 54,907 992,530 1,089,227 38,085 185,411 49,831 235,242 $ 1,362,554

1) Such capital surplus may be used to offset a deficit; in addition, when the Corporation has no deficit, such capital surplus may be distributed as cash dividends or transferred to share capital (limited to a certain percentage of the Corporation’s capital surplus and to once a year).
2) Such capital surplus from the effect of changes in associate’s ownership interest in its subsidiary that resulted from actual acquisition and disposal of equity may be used to offset a deficit or distributed as cash dividends or share dividends under Article 241-1 of Company Act.
66 -
3) Such capital surplus from the effect of changes in associate’s ownership interest in its subsidiary that resulted from equity transactions other than actual acquisition and disposal may be used to offset a deficit under Article 239-1 of Company Act.
c. Retained earnings and dividends policy

Under the dividend policy, where the Corporation has a profit at the end of a fiscal year, the Corporation shall first pay business income taxes based on law and then offset losses of previous years, and if there is any remaining profit, 10% of the balance shall be appropriated as legal reserve. In addition, appropriation for special reserve shall be made based on provisions of law. Any remaining amount of profit together with the accumulated undistributed earnings of the previous year shall be allocated for distribution to shareholders. However, depending on the condition of the business, part of the profit may be retained. In case of an increase in the capital of the Corporation, the shareholders’ bonus for the new shares in the year of issue shall be decided in the shareholders’ meeting. For the policies on distribution of employees’ compensation and remuneration of directors, refer to employees’ compensation and remuneration of directors in Note 32 (f).

The distribution of shareholders’ dividend shall take into consideration the changes in the outlook of the Corporation’s businesses, the lifespan of the various products or services that have an impact on future capital needs and taxation. Shareholders’ dividend shall be distributed with the aim of maintaining stable shareholders’ dividend distributions. Save for the purposes of improving the financial structure, reinvestments, production expansion or other capital expenditures in which capital is required, when distributing shareholders’ dividend, the dividend payout ratio each fiscal year shall be no less than 50% of the final surplus which is the sum of after-tax profit of the fiscal year to withhold previous loss, if any, legal reserve and special reserve as required by law; the cash dividend shall not be less than 10% of the total shareholders’ dividend distributed in the same year.

These appropriations shall be resolved by the shareholders in the following year and given effect to in the financial statements of that year.

The legal reserve may be used to offset deficits. If the Corporation has no deficit and the legal reserve has exceeded 25% of the Corporation’s paid-in capital, the excess may be transferred to capital or distributed in cash.

The Corporation is required to appropriate to or reverse from special reserve amounts that pertains to items referred to under Rule No. 1010012865, Rule No. 1010047490 and Rule No. 1030006415 issued by the FSC and the directive titled “Questions and Answers for Special Reserves Appropriated Following Adoption of IFRSs”.

The appropriation of earnings and dividends per share for 2018 and 2017 were approved in the shareholders’ meetings on June 24, 2019 and June 26, 2018, respectively, were as follows:

Legal reserve Special reserve Cash dividends Cash dividends per share (NT$)	Appropriation of Earnings	Appropriation of Earnings	Appropriation of Earnings
	For the Year Ended December 31
		2018 $ 1,111,709 $ 518,281 $ 9,412,052 $ 2.8	2017 $ 546,900 $ 943,188 $ 4,033,737 $ 1.2

67 -

The appropriation of earnings for 2019 had been proposed by the Corporation’s board of directors on March 25, 2020. The proposed appropriation of earnings and dividend per share were as follows:

Legal reserve Special reserve Cash dividends Cash dividends per share (NT$)	For the Year Ended December 31, 2019 $ 1,745,967 $ 804,347 $ 10,084,341 $ 3.0

Assuming that the shares reciprocally held by associates were not treated as treasury shares and not deducted from weighted average number of shares outstanding, the basic EPS would be NT$5.19 for the year ended December 31, 2019.

The appropriations of earnings for 2019 are subject to the resolution of the shareholders’ meeting to be held on June 23, 2020.

d. Special reserve recognized at the date of transition

In the first-time adoption of IFRSs, the amounts of adjusted unrealized revaluation increments, cumulative translation adjustments and unappropriated earnings recognized from the investment properties of associates which used fair value as deemed cost were $10,715,430 thousand, $3,163,258 thousand and $52,494 thousand, respectively; the Corporation appropriated the amounts to special reserve.

In addition, on the initial application of the fair value model to investment properties, the Corporation appropriated to special reserve the amount of the net increase in fair value of investment properties and transferred it to retained earnings. Additional special reserve should be appropriated for subsequent net increases in fair value. The amount appropriated may be reversed to the extent that the cumulative net increases in fair value decrease or on the disposal of investment properties.

The Group and its associates used and disposed of some of the related assets; accordingly, special reserve reversed to unappropriated earnings amounted to $548,152 thousand as of December 31, 2019.

e. Other equity items
1) Exchange differences on translating the financial statements of foreign operations

Balance at January 1 Exchange differences on translating the financial statements of foreign operations Share of exchange difference of associates and joint ventures accounted for using equity method Balance at December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ (2,641,364) (1,818,030) (1,453,807) $ (5,913,201)	2018 $ (2,638,153) (627,348) 624,137 $ (2,641,364)

68 -

2) Unrealized gain (loss) on financial assets at FVTOCI

For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
2019 2018 $ 5,268,916 $ 516,962 1,190,260 926,188 - (219,554) 1,502,271 634,103 26,587 2,520 (79,711) 3,408,697 $ 7,908,323 $ 5,268,916 For the Year Ended December 31
2019 $ 60,934 - (8,793) $ 52,141 For the Year Ended			2018 $ 58,485 (2,434) 4,883 $ 60,934 December 31
2019 $ 307,728 77,486 $ 385,214 For the Year Ended			2018 $ 307,728 - $ 307,728 December 31
	2019 $ 21,156,120 (4) 21,156,116 4,784,280 (817,599) 3,032 -	2018 $ 18,365,609 - 18,365,609 3,772,103 (267,413) 1,497 (526) (Continued)

69 -

Remeasurement on defined benefit plans Related income tax Share of other comprehensive income of associates and joint ventures accounted for using equity method Share of other changes in equity of associates and joint ventures accounted for using equity method Cash dividends from subsidiaries Balance at December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 736 (118) 3,782 (29) (1,748,520) $ 23,381,680	2018 $ (309) 3 8,662 (2) (723,504) $ 21,156,120 (Concluded)

31. OPERATING REVENUE

a. Revenue from contracts with customers

Operating revenue Sales of goods Electric power revenue Transportation revenue Rental revenue Engineering revenue Income from investments Sale of investments Cost of investments sold Gain on sale of investments, net Dividends Total income from investments Less: Sales returns and discounts Total operating revenue, net	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 79,348,234 6,385,664 1,751,490 1,110,758 183,836 5,969,730 5,651,384 318,346 310,015 628,361 60,706 $ 89,347,637	2018 $ 73,071,313 5,905,306 1,803,059 1,142,218 286,691 3,135,587 2,883,728 251,859 335,416 587,275 54,858 $ 82,741,004

b. Contract balances

Contract balances
Contract assets Contract liabilities	For the Year Ended		December 31
		2019 $ 68,412 $ 987,496	2018 $ 147,528 $ 731,015

The changes in the balance of contract assets and contract liabilities primarily result from the timing difference between the Group’s performance and the respective customer’s payment

70 -

32. NET PROFIT

Net profit was as follows:

a. Other income

Interest income Dividends Government grants Rental income Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 1,126,001 451,294 219,549 15,826 185,930 $ 1,998,600	2018 $ 370,571 434,898 430,015 51,105 193,214 $ 1,479,803

b. Other gains and losses

Net gain (loss) gain on financial assets and liabilities designated as at FVTPL Net foreign exchange (losses) gains Gain on changes in fair value of investment properties (Note 18) Bank charges Gain on disposal of investments Loss on disposal of property, plant and equipment Preparatory costs (Note 22) Loss on disposal of investments accounted for using equity method Impairment losses of goodwill Impairment losses recognized on investments accounted for using equity method Gain on disposal of subsidiaries Miscellaneous expenses	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 1,129,040 (260,069) 197,647 (129,895) 46,846 (44,225) (40,286) (5,761) - - - (231,643) $ 661,654	2018 $ (256,294) 90,672 98,015 (142,401) - (33,455) (159,275) - (630,631) (200,245) 40,440 (540,592) $ (1,733,766)

c. Finance costs

Interest on bank loans Interest on lease liabilities Amortization of discount on bonds payable Other interest expense Less: Amounts included in the cost of qualifying assets (capitalized interest)	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 1,745,355 38,518 88,240 5,842 (57,332) $ 1,820,623	2018 $ 1,645,742 - 24,567 3,103 (227) $ 1,673,185

71 -

Information about capitalized interest was as follows:

Capitalized interest Capitalization rate

For the Year Ended December 31
2019 2018
$ 57,332 $ 227
0.758%-1.797% 0.726%-1.139%

d. Depreciation and amortization

An analysis of depreciation by function Operating costs Operating expenses Non-operating expenses An analysis of amortization by function Operating costs Operating expenses	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 4,614,621 207,601 5,196 $ 4,827,418 $ 1,281,762 10,963 $ 1,292,725	2018 $ 4,524,970 115,507 9,084 $ 4,649,561 $ 172,655 11,594 $ 184,249

e. Employee benefits expense

Post-employment benefits (Note 29) Defined contribution plans Defined benefit plans Short-term benefits Salary Remuneration of directors Labor and health insurance Other employees - related expenses Termination benefits Other employee benefits Total employee benefits expense Post-employment benefits (Note 29) Defined contribution plans Defined benefit plans Short-term benefits Salary Remuneration of directors Labor and health insurance Other employees - related expenses Termination benefits Other employee benefits Total employee benefits expense	For the Year Ended December 31, 2019	For the Year Ended December 31, 2019
	Operating Costs Operating Expenses Non-operating Expenses $ 153,661 $ 36,735 $ - (457) (2,818) - 3,115,692 1,062,143 9,492 - 246,812 - 173,266 48,568 (1) 95,147 84,028 6 174 - 1,235 - 180,062 - $ 3,537,483 $ 1,655,530 $ 10,732 For the Year Ended December 31, 2018		Total $ 190,396 (3,275) 4,187,327 246,812 221,833 179,181 1,409 180,062 $ 5,203,745
	Operating Costs $ 160,404 3,743 2,869,723 - 176,539 86,654 - - $ 3,297,063	Operating Expenses Non-operating Expenses $ 41,020 $ 80 (442) - 932,725 3,200 250,692 - 50,966 153 12,285 70 - 3,270 71,340 432 $ 1,358,586 $ 7,205	Total $ 201,504 3,301 3,805,648 250,692 227,658 99,009 3,270 71,772 $ 4,662,854

72 -
f. Employees’ compensation and remuneration of directors

The Corporation accrued employees’ compensation and remuneration of directors at the rates between 1% and 4% and no higher than 2.5%, respectively, of net profit before income tax, employees’ compensation, and remuneration of directors. The employees’ compensation and remuneration of directors for the years ended December 31, 2019 and 2018, which have been approved by the Corporation’s board of directors on March 25, 2020 and March 21, 2019, respectively, were as follows:

Employees’ compensation Remuneration of directors	For the Year Ended December 31	For the Year Ended December 31
	2019 Cash Shares $ 261,064 $ - 230,296 -	2018
		Cash Shares $ 253,436 $ - 223,658 -

If there is a change in the amounts after the annual consolidated financial statements are authorized for issue, the differences are recorded as a change in the accounting estimate.

There is no difference between the actual amounts of employees’ compensation and remuneration of directors paid and the amounts recognized in the consolidated financial statements for the years ended December 31, 2018 and 2017.

Information on the employees’ compensation and remuneration of directors resolved by the Corporation’s board of directors in 2020 and 2019 is available at the Market Observation Post System website of the Taiwan Stock Exchange.

33. INCOME TAXES RELATING TO CONTINUING OPERATIONS

a. Major components of tax expense recognized in profit or loss

Current tax In respect of the current year Income tax on unappropriated earnings Withholding tax on dividend Adjustments for prior years Deferred tax In respect of the current year Adjustments to deferred tax attributable to changes in tax rates and laws Income tax expense recognized in profit or loss	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 5,286,839 4,049 357,160 33,997 5,682,045 467,184 - 467,184 $ 6,149,229	2018 $ 4,205,378 22,260 143,261 3,608 4,374,507 974,372 132,042 1,106,414 $ 5,480,921

73 -

A reconciliation of accounting profit and income tax expenses is as follows:

Profit before tax from continuing operations Income tax expense calculated at the statutory rate Nondeductible expenses in determining taxable income Tax-exempt income Unrecognized deductible temporary differences Tax on changes in fair value of investment properties Unrecognized (deductible) loss carryforwards Investment credits Effect of tax rate changes Effect of different tax rate of the Group operating in other jurisdictions Income tax on unappropriated earnings Additional income tax under the Alternative Minimum Tax Act Withholding tax on dividend Adjustments for prior years’ tax Tax credit - income from sources in Mainland China Income tax expense recognized in profit or loss	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 28,393,182 $ 5,678,636 394,782 (984,792) 1,495,799 (4,024) 44,197 (671,516) - 12,260 4,049 - 357,160 33,997 (211,319) $ 6,149,229	2018 $ 20,370,118 $ 4,074,024 646,250 (1,047,109) 2,022,562 (19,411) (82,852) (441,247) 132,042 14,167 22,260 13,366 143,261 3,608 - $ 5,480,921

The Income Tax Act in the ROC was amended in 2018, and the corporate income tax rate was adjusted from 17% to 20%. In addition, the rate of the corporate surtax applicable to the 2018 unappropriated earnings was reduced from 10% to 5%. The applicable tax rate used by subsidiaries in China is 15%-25%. Tax rates used by other entities in the Group operating in other jurisdictions are based on the tax laws in those jurisdictions.

b. Income tax recognized in other comprehensive income

Income tax recognized in other comprehensive income
Deferred tax In respect of the current year Fair value changes of financial assets at FVTOCI Remeasurement on defined benefit plans Total income tax recognized in other comprehensive income	For the Year Ended		December 31
		2019 $ - (117,626) $ (117,626)	2018 $ (220,107) (64,194) $ (284,301)

c. Current tax assets and liabilities

Current tax assets Tax refund receivable Current tax liabilities Income tax payable		December 31	December 31
		2019 $ 6,785 $ 2,957,672	2018 $ 15,901 $ 2,181,268

74 -

d. Deferred tax assets and liabilities

The movements of deferred tax assets and deferred tax liabilities were as follows:

For the year ended December 31, 2019

Opening
Balance
Recognized in
Profit or Loss
Recognized in
Other
Comprehensive
Income
Deferred tax assets
Temporary differences
Allowance for impairment
loss
$ 203,417
$ 58,283
$ -

Defined benefit obligation
25,341
-
182
Other financial assets and
liabilities
8,943
3,804
-
Investment properties
4,173
1,534
-
Property, plant and
equipment
3,940
235
-
Others

127,364

(23,081)

-

373,178
40,775
182
Tax losses

63,060

12,853

-

$ 436,238
$ 53,628
$ 182

Deferred tax liabilities
Temporary differences
Land value increment tax $ 3,449,871
$ -
$ -

Investment properties
3,089,623
(2,490)
-
Unappropriated earnings
of subsidiaries and
associates
1,763,029
541,424
-
Finance leases
616,363
(17,337)
-
Defined benefit obligation
338,363
9,762
117,808
Associates
61,168
(3,219)
-
Property, plant and
equipment
32,877
6,807
-
Unrealized foreign
exchange gain
11,372
(11,372)
-
Allowance for impairment
loss
296
(296)
-
Others

2,467

(2,467)

-

$ 9,365,429
$ 520,812
$ 117,808

For the year ended December 31, 2018
Opening
Balance
Recognized in
Profit or Loss
Recognized in
Other
Comprehensive
Income
Deferred tax assets
Temporary differences
Allowance for impairment
loss
$ 167,788
$ 39,199
$ -

Defined benefit obligation
23,027
-
2,314
Other financial assets and
liabilities
-
8,943
-

Exchange
Differences
Closing Balance
$ (10,605) $ 251,095
(7)
25,516
-
12,747
(243)
5,464
30
4,205

(4,163)

100,120
(14,988)
399,147

(131)

75,782
$ (15,119)
$ 474,929
$ -
$ 3,449,871
-
3,087,133
(10,330) 2,294,123
-
599,026
-
465,933
(2,297)
55,652
-
39,684
-
-
-
-

-

-
$ (12,627)
$ 9,991,422
Exchange
Differences
Closing Balance
$ (3,570) $ 203,417
-
25,341
-
8,943
(Continued)

75 -

Investment properties Property, plant and equipment FVTOCI financial assets Others Tax losses Deferred tax liabilities Temporary differences Land value increment tax Investment properties Unappropriated earnings of subsidiaries Finance leases Defined benefit obligation Associates Property, plant and equipment Other financial assets and liabilities Allowance for impairment loss Others	Opening Balance Recognized in Profit or Loss Recognized in Other Comprehensive Income $ 4,124 $ 112 $ - 21,526 (17,647) - 220,113 - (220,113) 75,217 53,746 - 511,795 84,353 (217,799) 52,390 10,839 - $ 564,185 $ 95,192 $ (217,799) $ 3,449,871 $ - $ - 3,109,538 (19,915) - 654,553 1,110,236 - 547,736 68,627 - 245,265 26,596 66,502 65,639 (3,390) - 22,033 10,844 - 4,671 6,701 - 84 212 - 772 1,695 - $ 8,100,162 $ 1,201,606 $ 66,502	Exchange Differences Closing Balance $ (63) $ 4,173 61 3,940 - - (1,599) 127,364 (5,171) 373,178 (169) 63,060 $ (5,340) $ 436,238 $ - $ 3,449,871 - 3,089,623 (1,760) 1,763,029 - 616,363 - 338,363 (1,081 ) 61,168 - 32,877 - 11,372 - 296 - 2,467 $ (2,841) $ 9,365,429 (Concluded)

e. Unused loss carryforwards for which no deferred tax assets have been recognized in the consolidated balance sheets

Loss carryforwards Expire in 2018 Expire in 2019 Expire in 2020 Expire in 2021 Expire in 2022 Expire in 2023 Expire in 2024 Expire in 2025 Expire in 2026 Expire in 2027 Expire in 2029 No expiration		December 31	December 31
		2019 $ - - 65 222,751 247,214 27,810 58,219 299,401 - - 4,312 7,522 $ 867,294	2018 $ 1,635 561,999 - 222,721 247,162 27,752 58,219 299,401 156,574 23,022 - - $ 1,598,485

76 -
f. Information about unused loss carryforwards

Loss carryforwards as of December 31, 2019 comprised the following:

Unused Amount	Unused Amount	Expiry Year
$	65	2020
	222,751	2021
	247,214	2022
	27,810	2023
	58,219	2024
	299,401	2025
	229,335	2029
	188,566	No expiration
$	1,273,361

g. The aggregate amount of temporary differences associated with investments for which deferred tax liabilities have not been recognized

As of December 31, 2019 and 2018, the taxable temporary differences associated with investments in subsidiaries for which no deferred tax liabilities have been recognized were $5,750,255 thousand and $5,104,939 thousand, respectively.

h. The latest years of income tax returns which had been examined and cleared by the tax authorities were as follows:

Company The Corporation DCI YTRMC YSRMC FMT AEE AIC FDT YLPPC FSMS NHC CHP YLSS YLT	Year
	2017 2017 2017 2017 2017 2017 2017 2017 2017 2017 2017 2017 2017 2017

34. EARNINGS PER SHARE

Unit: NT$ Per Share

	Unit: NT$ Per Share	Unit: NT$ Per Share	Unit: NT$ Per Share
Basic earnings per share Diluted earnings per share	For the Year Ended December 31
		2019 $ 5.56 $ 5.25	2018 $ 3.54 $ 3.49

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The earnings and weighted average number of ordinary shares outstanding used for the earnings per share computation were as follows:

Net Profit for the Year

computation were as follows: Net Profit for the Year
Profit for the period attributable to owners of the Corporation Effect of potentially dilutive ordinary shares: Convertible bonds Earnings used in the computation of diluted earnings per share	For the Year Ended December 31
		2019 $ 17,459,673 (55,373) $ 17,404,300	2018 $ 11,117,094 26,638 $ 11,143,732

Weighted average number of ordinary shares outstanding (in thousand shares):

Weighted average number of ordinary shares outstanding (in thousand	shares):	shares):
Weighted average number of ordinary shares in computation of basic earnings per share Effect of potentially dilutive ordinary shares: Employees’ compensation Convertible bonds Weighted average number of ordinary shares used in the computation of diluted earnings per share	For the Year Ended		December 31
		2019 3,138,664 6,888 166,769 3,312,321	2018 3,139,152 8,585 44,656 3,192,393

The weighted average number of ordinary shares used in the computation of basic earnings per share is the weighted average outstanding shares after subtracting the shares of the Corporation held by the associates treated as treasury shares.

When an entity pays employee compensation that may be settled in shares or cash at the entity’s option, the entity shall presume that the employee compensation will be settled in shares, and the resulting potential shares shall be included in diluted earnings per share if the effect is dilutive. The number of shares is estimated by dividing the entire amount of the compensation by the closing price of the shares at the balance sheet date. Such dilutive effect of the potential shares is included in the computation of diluted earnings per share until the number of shares to be distributed to employees is resolved in the following year.

35. CAPITAL MANAGEMENT

The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns while maximizing the return to shareholders through the optimization of the debt and equity balance.

The capital structure of the Group consists of net debt (borrowings offset by cash and cash equivalents) and equity of the Group (comprising issued capital, reserves, retained earnings and other equity).

The Group is not subject to any externally imposed capital requirements.

Key management personnel of the Group review the capital structure on an annual basis. As part of this review, the key management personnel consider the cost of capital and the risks associated with each class of capital. Based on recommendations of the key management personnel, in order to balance the overall capital structure, the Group may adjust the amount of dividends paid to shareholders and the amount of new debt issued or existing debt redeemed.

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36. FINANCIAL INSTRUMENTS

a. Fair value of financial instruments not measured at fair value

December 31, 2019

Carrying Amount Financial liabilities Financial liabilities measured at amortized cost Bonds payable (include current portion) $ 22,280,807 December 31, 2018 Carrying Amount Financial liabilities Financial liabilities measured at amortized cost Bonds payable (include current portion) $ 16,192,567	FairValue
	Level 1 Level 2 Level 3 Total $ 24,156,832 $ - $ - $ 24,156,832 Fair Value
	Level 1 Level 2 Level 3 Total $ 16,719,158 $ - $ - $ 16,719,158

b. Fair values of financial instruments measured at fair value on a recurring basis
1) Fair value hierarchy

December 31, 2019

Financial assets at FVTPL Listed shares Beneficiary certificates Financial assets at FVTOCI Domestic listed shares Domestic unlisted shares Overseas listed shares Overseas unlisted shares Financial liabilities at FVTPL Convertible options Cross-currency swap contracts	Level 1 $ 3,474,606 752,751 $ 4,227,357 $ 13,238,421 - 212,497 - $ 13,450,918 $ - - $ -	Level 2 $ - 500,866 $ 500,866 $ - - - - $ - $ - - $ -	Level 3 $ - - $ - $ - 1,614,601 - 604,985 $ 2,219,586 $ 81,724 30,346 $ 112,070	Total $ 3,474,606 1,253,617 $ 4,728,223 $ 13,238,421 1,614,601 212,497 604,985 $ 15,670,504 $ 81,724 30,346 $ 112,070

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December 31, 2018

Financial assets at FVTPL Listed shares Beneficiary certificates Financial assets at FVTOCI Domestic listed shares Domestic unlisted shares Overseas listed shares Overseas unlisted shares Financial liabilities at FVTPL Convertible options Cross-currency swap contracts	Level 1 $ 3,502,988 1,390,765 $ 4,893,753 $ 11,774,012 - 152,337 - $ 11,926,349 $ - - $ -	Level 2 $ - 4,152,830 $ 4,152,830 $ - - - - $ - $ - - $ -	Level 3 $ - - $ - $ - 1,537,291 - 122,026 $ 1,659,317 $ 223,501 44,717 $ 268,218	Total $ 3,502,988 5,543,595 $ 9,046,583 $ 11,774,012 1,537,291 152,337 122,026 $ 13,585,666 $ 223,501 44,717 $ 268,218

There were no transfers between Levels 1 and 2 for the years ended December 31, 2019 and 2018.

2) Reconciliation of Level 3 fair value measurements of financial instruments

Balance at January 1, 2019 Recognized in profit or loss Net gain (loss) on financial liabilities at FVTPL Recognized in other comprehensive income Unrealized gain (loss) on financial assets at FVTOCI Exchange differences on translation of foreign financial statements Purchases Settlements Transfers into Level 3 Balance at December 31, 2019	Financial Liabilities at Financial Assets at FVTOCI FVTPL Equity Derivatives Instruments $ (268,218) $ 1,659,317 156,148 - - (173,946) - 1 - 118,055 - (113) - 616,272 $ (112,070) $ 2,219,586

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Balance at January 1, 2018 Recognized in profit or loss Net gain (loss) on financial liabilities at FVTPL Recognized in other comprehensive income Unrealized gain (loss) on financial assets at FVTOCI Purchases Transfers out of Level 3 Balance at December 31, 2018	Financial Liabilities at Financial Assets at FVTOCI FVTPL Equity Derivatives Instruments $ - $ 10,090,195 (47,303) - - 1,361,674 (220,915) - - (9,792,552) $ (268,218) $ 1,659,317

3) Valuation techniques and inputs applied for Level 2 fair value measurement

Financial Instruments Valuation Techniques and Inputs

Mutual funds The Group uses net asset value as the basis to determine the fair value as the Group has determined that the net asset value of the mutual fund represents fair value at the end of the reporting period.

4) Valuation techniques and inputs applied for Level 3 fair value measurement
a) The fair values of convertible bond options are determined using the information available from the counterparty for valuation based on the option pricing model. The option pricing model incorporates the present value techniques and reflects both the time value and the intrinsic value of options.
b) The fair value of cross currency swap contracts is determined using the information available from the counterparty for valuation. The counterparty measures the fair value of a cross currency swap contracts using the discounted cash flows model. Future cash flows are estimated based on observable forward exchange rates at balance sheet dates and contract forward rates and discounted at rates that reflect the credit risk of various counterparties.
c) The fair value of equity securities suspended for trading and therefore without quoted price was determined by using the weighted average of values calculated under market-based approach. In market-based approach, the fair value of the investee is measured by weighted average multiple value of (i) EV/sales, (ii) EV/EBITDA, and (iii) P/B of other comparable listed companies. Liquidity risk parameters need to be taken into account when using this approach.
- i. EV/Sales: Enterprise value ÷ Sales.
- ii. EV/EBITDA: Enterprise value ÷ Earnings before interest, taxes, depreciation and amortization.

iii. P/B: Price ÷ Book value.

d) The fair values of unlisted shares are determined by using the asset approach or the market approach. In the asset approach, the fair values are estimated by using the net asset value measured at fair value based on the unlisted investees’ latest financial statements, while taking into account the liquidity discount and non-controlling interest discount. In the market approach, the fair values are estimated based on the market transaction prices of comparable companies with similar industrial and business characteristics and liquidity discount are considered.
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c. Categories of financial instruments

Categories of financial instruments
Financial assets Financial assets at FVTPL Financial assets at amortized cost (1) Financial assets at FVTOCI Financial liabilities Financial liabilities at FVTPL Financial liabilities at amortized cost (2)	December 31
	2019 2018 $ 4,728,223 $ 9,046,583 70,392,634 55,388,001 15,670,504 13,585,666 112,070 268,218 109,832,847 105,054,422

1) The balances include financial assets at amortized cost, which comprise cash and cash equivalents, debt investments, notes receivable, trade receivables and other receivables.
2) The balances include financial liabilities measured at amortized cost, which comprise short-term and long-term loans, short-term and long-term bills payable, trade and other payables, and bonds issued.
d. Financial risk management objectives and policies

The Group’s major financial instruments include equity and debt investments, trade receivables, trade payables, bonds payable, borrowings and lease liabilities. The Group’s Corporate Treasury function provides services to the business, coordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the Group through internal risk reports which analyze exposures by degree and magnitude of risks. These risks include market risk (including foreign currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

The Group mitigates the effects of these risks by using derivative financial instruments to hedge risk exposures. The use of financial derivatives is governed by the Group’s policies approved by the Corporation’s board of directors, which provides written principles on foreign currency risk, interest rate risk, credit risk, the use of financial derivatives and non-derivative financial instruments, and the investment of excess liquidity. Compliance with policies and exposure limits is reviewed by the internal auditors on a continuous basis.

1) Market risk

The Group’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates. The Group enters into cross-currency swap contracts to mitigate its exposure to foreign currency risk and interest risk.

a) Foreign currency risk

Several subsidiaries of the Corporation have foreign currency sales and purchases and foreign currency financing activities, which expose the Group to foreign currency risk.

The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities (including those eliminated on consolidation) and derivatives exposed to foreign currency risk at the end of the reporting period are set out in Note 41.

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Sensitivity analysis

The Group was mainly exposed to the RMB and USD.

The following table details the Group’s sensitivity to a 5% increase and decrease in the functional currency against the relevant foreign currencies. The sensitivity rate of 5% is used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis included only outstanding foreign currency denominated monetary items less notional amounts of cross-currency swap. The analysis assumed a 5% change in foreign currency rates at the end of the reporting period. A positive number below indicates an increase in pre-tax profit assuming the New Taiwan dollars weakened by 5% against the relevant currency. For a 5% strengthening of New Taiwan dollars against the relevant currency, there would be an equal and opposite impact on pre-tax profit and the balances shown below would be negative.

Increase (decrease) in pre-tax profit	RMB Impact For the Year Ended December 31 2019 2018 $ 46,002 $ 69,060	USD Impact
		For the Year Ended December 31
		2019 2018 $ 709,830 $ 145,181

b) Interest rate risk

The Group is exposed to interest rate risk because entities in the Group borrows funds at both fixed and floating interest rates. The risk is managed by the Group by maintaining an appropriate mix of fixed and floating rate borrowings and using cross currency swap contracts.

The carrying amounts of the Group’s financial assets and financial liabilities with exposure to changes in interest rates at the end of the reporting period were as follows:

Fair value interest rate risk Financial assets Financial liabilities Cash flow interest rate risk Financial assets Financial liabilities	December 31
	2019 2018 $ 27,512,074 $ 17,727,715 71,427,610 45,872,001 19,745,430 12,084,642 26,024,771 50,569,182

Sensitivity analysis

The sensitivity analysis below is based on the Group’s exposure to changes in interest rates of non-derivative instruments at the end of the reporting period.

If interest rates had been 0.01% higher/lower and all other variables were held constant, the Group’s pre-tax profit for the years ended December 31, 2019 and 2018 would have decreased/increased by $2,238 thousand and $3,698 thousand, respectively, mainly due to the Group’s exposure to changes in interest rates of its variable-rate bank borrowings and bank deposits.

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c) Other price risk

The Group is exposed to price risk through its investments in listed equity securities, corporate bonds and beneficiary certificates of funds.

Sensitivity analysis

The sensitivity analysis below is based on the exposure to investment position price risks at the end of the reporting period.

If investment position prices had been 1% higher/lower, pre-tax profit for the years ended December 31, 2019 and 2018 would have increased/decreased by $47,282 thousand and $90,466 thousand, respectively, as a result of the changes in fair value of financial assets at fair value through profit or loss, and the pre-tax other comprehensive income for the years ended December 31, 2019 and 2018 would have increased/decreased by $134,509 thousand and $119,263 thousand, respectively, as a result of the changes in fair value of financial assets at fair value through other comprehensive income.

2) Credit risk

Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in financial loss to the Group. As at the end of the reporting period, the Group’s maximum exposure to credit risk which would cause a financial loss to the Group due to the failure of counterparties to discharge an obligation and financial guarantees provided by the Group is equal to the carrying amount of the financial assets as stated in the balance sheets. The Group adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. The Group only transacts with entities that are rated the equivalent of investment grade and above. The Group uses publicly available financial information and its own trading records to rate its major customers. The Group’s exposure and the credit ratings of its counterparties are continuously monitored.

The counterparties in trade receivables consist of a large number of clients in different industries and regions. The Group evaluates clients’ financial condition continuously.

Credit risk represents the potential negative impact on the financial assets of the Group if counterparties or third parties breach the contracts. The Group evaluates credit risk exposure on contracts with positive carrying value. The Group evaluated the credit risk exposure as immaterial because all counterparties are reputable financial institutions and companies with good credit ratings.

3) Liquidity risk

The Group manages liquidity risk by monitoring and maintaining a level of cash and cash equivalents deemed adequate to finance the Group’s operations and mitigate the effects of fluctuations in cash flows. In addition, management monitors the utilization of bank borrowings and ensures compliance with loan covenants.

a) Liquidity and interest rate tables for non-derivative financial liabilities

The following tables detail the Group’s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The tables had been drawn up based on the undiscounted cash flows of financial liabilities from the earliest date on which the Group can be required to pay. The tables included both interest and principal cash flows.

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December 31, 2019

On Demand or Less than 1 Month Non-derivative financial liabilities Non-interest bearing $ 4,071,572 Lease liabilities 19,520 Variable interest rate liabilities 4,170,000 Fixed interest rate liabilities 5,110,435 $ 13,371,527 Additional information about the maturity	1-3 Months 3 Months to 1 Year $ 6,763,068 $ 2,249,956 39,041 175,682 3,402,589 1,701,775 38,322,937 3,187,476 $ 48,527,635 $ 7,314,889 analysis for lease liabilities:	1-3 Months 3 Months to 1 Year $ 6,763,068 $ 2,249,956 39,041 175,682 3,402,589 1,701,775 38,322,937 3,187,476 $ 48,527,635 $ 7,314,889 analysis for lease liabilities:	5+ Years $ 88,917 1,091,089 2,377,541 -
			$ 3,557,547
			20+ Years $ 348,028
Lease liabilities December 31,	5-10 Years $ 372,944 1-3 Months $ 2,662,290 6,725,614 6,213,450 $ 15,601,354	10-15 Years $ 207,887 3 Months to 1 Year $ 866,745 8,508,552 4,725,303 $ 14,100,600
			5+ Years $ 70,309 - -
			$ 70,309

The amounts above of variable interest rate non-derivative financial assets and liabilities are subject to change if actual variable interest rates differ from those estimates of interest rates at the end of the reporting period.

b) Liquidity and interest rate tables for derivative financial liabilities

The following table details the Group’s liquidity analysis of its derivative financial instruments. The table is based on the undiscounted contractual net cash inflows and outflows on derivative instruments that settle on a net basis. When the amount payable or receivable is not fixed, the amount disclosed is determined by reference to the projected interest rates as illustrated by the yield curves at the end of the reporting period.

December 31, 2019

On Demand or Less than 1 Month 1-3 Months 3 Months to 1 Year Net settled Cross-currency swap contracts $ - $ (44,872) $ (135,109)	1-5 Years $ (135,109)	5+ Years $

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December 31, 2018

On Demand or Less than 1 Month 1-3 Months 3 Months to 1 Year Net settled Cross-currency swap contracts $ - $ (39,911) $ (139,437)	1-5 Years $ (322,827)	5+ Years $ -

e. Transfers of financial assets. None.
f. Offsetting financial assets and financial liabilities. None.
g. Reclassifications. None.

37. TRANSACTIONS WITH RELATED PARTIES

Balances and transactions between the Corporation and its subsidiaries, which are related parties of the Corporation, have been eliminated on consolidation and are not disclosed in this note. Besides information disclosed elsewhere in the other notes, details of transactions between the Group and other related parties are disclosed below.

Transactions with related parties are conducted under normal terms.

Balances and transactions between the Group and single related party are disclosed separately except when the amount is less than 10% of the total balances or transactions; otherwise, the amounts are lumped together as others.

a. Related party name and category

Related Party Name FENC U-Ming SHSTC EISF PGIC YDC OSC HZYCCL FEDSDL YDLC FEC YDES YYI YDEC Alliance PEI HXMC WAMTC	Related Party Category
	Associate Associate Associate Associate Associate Associate Associate Associate Associate Associate Associate Associate Associate Associate Joint venture Joint venture Joint venture Joint venture (Continued)

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Related Party Name
Malaysia Garment Manufacturers Private Limited
U-Ming Transport (Singapore) Private Limited
CHC Resources Corporation
Far Eastern Department Store Ltd.
Chu Chiang Enterprise Corp. Ltd.
Chu Feng
Air Liquide Far Eastern Co.
Oriental Petrochemical (Taiwan) Corporation
Far Eastern Memorial Hospital
Ya Tung Department Store Ltd.
Yuan Ze University
Oriental Resources Development Co., Ltd.
Far Eastern Leasing Corporation
Ho Hwei Enterprise Corp. Ltd.
Far Eastern Apparel Co., Ltd.
Oriental Union Chemical Corp.
NanKung Enterprise Ltd.
New Century InfoComm Tech Co., Ltd.
Ding & Ding Management Consultants Co., Ltd.
Far Eastern Fibertech Co., Ltd.
Far Eastern Technical Consultants Co., Ltd.
Far Eastern International Bank (FEIB)
FENCC
Far Eastern New Apparel (Vietnam) Ltd.
Far Eastern Polytex (Vietnam) Ltd.
FERD
Far Eastern General Construction Inc.
Far EasTone Telecommunications Co., Ltd.
Far Eastern Property Insurance Agency Co., Ltd.
Far Eastern International Leasing Corporation
Lien Fang Enterprise Corp. Ltd.
Chubei New Century Shopping Mall Co., Ltd.
Far Eastern Electronic Toll Collection Co., Ltd.
Mr. Xu Yuanzhi Memorial Foundation
YDT Technology International Corporation
J-Power Investment Netherlands
Pan Asia Engineers & Constructors Corp.

Related Party Category

Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
Other
(Concluded)

Note: Other related party relationships mainly include associates’ subsidiaries, legal person in which the chairman is the same as the Corporation’s chairman and the director is also the Corporation’s chairman.

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b. Operating Transactions

Operating revenue Associates Others Joint ventures Operating cost Associates Others Joint ventures	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 702,196 1,723,085 649,054 $ 3,074,335 $ 612,418 851,858 784,217 $ 2,248,493	2018 $ 694,540 1,766,679 497,486 $ 2,958,705 $ 601,236 907,989 653,781 $ 2,163,006

Receivables from related parties (including notes receivable, trade receivables, other receivables and contract assets):

Associates Others FENCC Others Joint ventures		December 31	December 31
		2019 $ 127,197 - 569,063 569,063 182,808 $ 879,068	2018 $ 120,926 1,929,748 1,243,535 3,173,283 268,741 $ 3,562,950

Accounts payable and accrued expenses to related parties:

Accounts payable and accrued expenses to related parties:
Associates Others Joint ventures		December 31
		2019 $ 114,231 95,151 47,421 $ 256,803	2018 $ 98,574 83,694 68,588 $ 250,856

The outstanding trade payables and receivables from related parties are unsecured. For the years ended December 31, 2019 and 2018, no impairment losses were recognized for trade receivables from related parties.

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Prepayments:

Associates Others Joint ventures		December 31	December 31
		2019 $ 15,000 834 83,592 $ 99,426	2018 $ 15,000 77 - $ 15,077

c. Transactions with FEIB

Transactions with FEIB
Bank deposits (Note) Bank loans Cross-currency swap contracts		December 31
		2019 $ 5,137,217 $ 1,400,000 $ (1,415)	2018 $ 3,361,915 $ 2,106,000 $ 2,358)

As of December 31, 2019 and 2018, the notional principal of the above outstanding cross-currency swap contracts were both US$15,000 thousands.

Note: The balances included amounts recognized as financial assets measured at amortized cost, and other non-current assets (refundable deposits).

d. Compensation of key management personnel

The amounts of the compensation of directors and other key management personnel for the years ended December 31, 2019 and 2018 were as follows:

December 31, 2019 and 2018 were as follows:
Short-term employee benefits Post-employment benefits	For the Year Ended December 31
		2019 $ 307,050 864 $ 307,914	2018 $ 282,998 756 $ 283,754

The remuneration of directors and key executives is determined by the remuneration committee based on the performance of individuals and market trends.

e. Other transactions with related parties
1) Operating expense - rental

Associates Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 48,480 11,707 $ 60,187	2018 $ 50,433 19,073 $ 69,506

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2) Acquisitions of property, plant and equipment

Others 3) Acquisitions of investment properties Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
	2019 2018 $ - $ 34 For the Year Ended December 31
		2019 $ -	2018 $ 337

4) Lease agreement

Lease agreement
Others Others	Right-of-use Assets
	For the Year Ended December 31
		2019 2018 $ 154,800 $ - Lease Liabilities
	For the Year Ended December 31
		2019 $ 140,015	2018 $ -

5) The nature of the Group’s transaction with OFSPC is acquisition or disposal of OPAS Fund Segregated Portfolio’s overseas fund through OFSPC’s platform. The portfolio’s decision is made and managed by the investment committee which is composed of the Group and other investors. The Group’s investment activities through OFSPC’s platform for the years ended December 31, 2019 and 2018 included acquisition of $885,727 thousand and $4,065,473 thousand, respectively. For the year ended December 31, 2019, disposal and gain on disposal were $5,553,672 thousand and $263,631 thousand, respectively.
6) The Corporation’s subsidiary, DCI, subscribed shares of Catalyst Tranche Three for $123,960 thousand in 2019 and subscribed shares of Catalyst Tranche One for $123,120 thousand in 2018.

38. ASSETS PLEDGED AS COLLATERAL

The following assets are provided as collaterals for short-term and long-term bank borrowings or for purchases from suppliers.

Investment properties Investments accounted for using equity method Property, plant and equipment Financial assets at fair value through other comprehensive income Financial assets at amortized cost		December 31	December 31
		2019 $ 13,855,572 13,299,701 2,393,116 1,543,666 419,742 $ 31,511,797	2018 $ 13,840,249 13,374,748 2,830,624 1,241,250 169,139 $ 31,456,010

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39. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

As of December 31, 2019, the Corporation and its subsidiaries had the following significant commitments and contingencies:

a. Unused letters of credit of US$9,796 thousand and EUR9,177 thousand.
b. Guarantee notes issued for related parties:

The Corporation

AIC DCI NHC YTRMC YLPPC AEE YSRMC FSMS YLSS YLSS DCI FSMS YTRMC AOC AOG AOC	December 31, 2019 $ 12,195,800 9,848,950 1,509,020 1,000,000 497,642 329,930 150,000 30,000 $ 25,561,342 $ 100,000 $ 50,000 $ 14,965 $ 14,965

c. CHP entered into agreements on the following transactions:
1) Purchase of natural gas from Chinese Petroleum Corporation.
2) Power Plant (base load unit) Purchase and Sale Contract, Power Plant (medium-load unit) Purchase and Sale Contract and Electricity Purchase and Sale Contract for Gas Recirculation with Taiwan Power Company.
3) Contractual Service Agreement with General Electric Global Services GmbH.
4) Contract of Engineering, Procurement and Construction with General Electric Global Services GmbH. and GE Global Parts & Products, GmbH.
d. The estimated payments for construction of plants and acquisition of land use rights and equipment of JYDC, SIYDCCL, and SLCL in the future amount to RMB36,138 thousand.
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e. YSRMC supplied ready-mixed concrete to Da Cin Construction Co., Ltd. (“Da Cin”) during 2003. The owner of the project under construction demanded Da Cin to take responsibility to repair the construction flaws. Da Cin requested YSRMC to compensate the loss and damage on the construction. However, they did not reach an agreement from year 2006 to 2009. Da Cin filed an appeal and requested YSRMC to indemnify $22,881 thousand in April 2010. In July 2014, the local court concluded that YSRMC has to pay indemnity in the amount of $17,642 thousand. In years 2010 and 2014, YSRMC had estimated related compensation loss, accounted for as provisions, of $13,800 thousand and $3,840 thousand, respectively. YSRMC had also filed an appeal against the court’s decision in October 2014. Later, Da Cin requested additional compensation of $137,544 thousand in the second instance and the total damage compensation claimed was $160,425 thousand together with the amount in the first instance. As of the date the financial statements were authorized for issue, the case is in the process of examination by the Supreme Court so YSRMC cannot make reasonable estimate about the judgment. YSRMC did not recognize additional compensation loss up to the auditors’ report date.
f. On March 13, 2013, the No. 1114 Commissioners’ Meeting of Fair Trade Commission resolved that independent power producers violated Article 14, Paragraph 1 of Fair Trade Act due to the rejection of power purchase rate adjustment with TPC and fined CHP $400,000 thousand. Accordingly, CHP recognized penalty expenses, which is included in other losses in the consolidated financial statements for the year ended December 31, 2013. The penalty is payable in 60 monthly installments and covered by a long-term note payable. CHP had filed an appeal on April 17, 2013.

On September 12, 2013, the Petitions and Appeals Committee of the Executive Yuan rescinded the imposition of penalty (the “Penalty Disposition”) and advised the Fair Trade Commission to impose more appropriate disposition with refund of penalty paid by CHP. However, CHP’s appeal against the imposition of illegal concerted action among independent power producers (the “Act Disposition”) was dismissed.

Regarding the Penalty Disposition, the Fair Trade Commission resolved a penalty of $370,000 thousand on November 13, 2013. CHP thus adjusted the penalty expenses in other gains and losses for the year ended December 31, 2013. The disposition was revoked again by the Petitions and Appeals Committee on May 9, 2014. Then the Fair Trade Commission imposed a penalty of $364,000 thousand on July 9, 2014. CHP recognized a reversal gain of $6,000 thousand in other income for the year ended December 31, 2014 and issued a long-term note payable in 60 installments for the penalty in accordance with the disposition. In addition, CHP also filed an appeal to defend its interest on August 11, 2014.

On December 11, 2014, Letter from the Petitions and Appeals Committee indicates that the filing of appeal against the Penalty Disposition is suspended until the administrative court makes the final judgment on the Act Disposition.

Regarding the Act Disposition, on November 7, 2013, CHP filed an administrative litigation at the Taipei High Administrative Court against the dispositions of the Fair Trade Commission. The Taipei High Administrative Court entered a final judgment in favor of CHP on October 29, 2014. Nevertheless, the Fair Trade Commission filed an appeal with the Supreme Administrative Court. The Supreme Administrative Court dismissed the judgment made by the Taipei High Administrative Court on July 2, 2015. The Taipei High Administrative Court remanded the judgement on May 25, 2017 and still revoked the administrative disciplinary action and the judgement of the appeal. The Fair Trade Commission filed an appeal with the Supreme Administrative Court and the Taipei High Administrative Court filed an appeal to the Supreme Administrative Court on September 27, 2018. This case is currently heard by the Taipei High Administrative Court.

92 -
g. On March 15, 2013, Letter No. 102035 from the Fair Trade Commission indicated concerted action among CHP and other independent power producers due to the rejection of power purchase rate adjustment with TPC. Accordingly, in August 2015, TPC filed at the Taipei District Court a civil mediation which requests CHP to compensate $2.35 billion plus interest from November 1, 2007 to the settlement date for the damage caused. Later, in September 2015, TPC filed at the Taipei District Court a civil litigation appeal which requests CHP to compensate $2.349 billion plus interest from November 1, 2007 to the settlement date as well as an apology published in major newspapers. TPC also filed at the Taipei High Administrative Court an administrative litigation which requests CHP to compensate the damage caused which amounted to $1.4 billion plus interest from November 1, 2007 to the settlement date with a 5% annual interest rate.

CHP and TPC did not reach an agreement in the civil mediation council meeting held on October 7, 2015. Later, TPC included the damage compensation claimed in the civil mediation in the administrative litigation appeal and the total compensation claimed in the statement of the administrative litigation amounted to $3.75 billion plus interest from November 1, 2007 to the settlement date with a 5% annual interest rate. On November 27, 2015, the administrative court ruled that the litigation proceedings are suspended until the administrative court makes the final judgment on the Act Disposition. However, on July 12, 2016, Taipei High Administrative Court notified that the power purchase and sales contracts between independent power producers and TPC are subject to the performance of obligation under the Civil Code. Therefore, the abovementioned ruling for suspension was revoked and the administrative litigation for compensation would be transferred to the Taipei District Court. TPC filed counter appeal against the ruling; however, the appeal was dismissed by the Supreme Administrative Court on December 30, 2016. This case has been transferred to the Taipei District Court on January 25, 2017 and dismissed by Taipei District Court on April 12, 2019.

In light of the civil proceedings, on March 1, 2016, TPC added posterior statement which requests the capital expenditure it paid to CHP from October 9, 2007 to November 30, 2012 according to the power purchase and sales contracts to be recalculated relying on CHP’s capital ratio. Accordingly, CHP would compensate at least $2.349 billion to TPC. The Taipei District Court dismissed the appeal on November 1, 2018, and CHP filed an appeal subsequently. This case is currently heard by the Taiwan High Court.

CHP considered the payment of the indemnity is not possible unless TPC can provide proof that the damage was caused by CHP and their appeal is filed within the statute of limitation. As of the date the financial statements were authorized for issue, the amount of the compensation cannot be reasonably estimated. Therefore, CHP could not assess the possible impact on its financial position and did not recognize any contingent liabilities.

h. On December 4, 2015 and December 17, 2015, CSCGL, China Shanshui Cement Group (Hong Kong) Company Limited and China Pioneer Cement (Hong Kong) Company Limited (collectively referred as “Shanshui Cement Group”) commenced legal proceedings against former directors of CSCGL in respect of alleged dishonest breaches of fiduciary duty or alleged conspiracy to injure CSCGL during their tenures. The proceedings arose from disputes between CSCGL’s present and former board of directors over the changes in management and the takeover of the headquarters of CSCGL. On April 7, 2016, the Corporation was added as the 10th defendant. The Corporation engaged lawyers to take legal actions in connection with the unqualified claim to defend its reputation and interests. Up to the date of the auditors’ report, the trial was set to take place from April to June in 2021. The Corporation considered it premature to evaluate at this stage the likely outcome of the proceedings and therefore did not recognize any contingent liabilities.
93 -
i. Tianrui Group Company Limited and Tianrui (International) Holding Company Limited (collectively referred as “Tianrui Group”), CSI and former directors of CSCGL, in breach of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, the Codes on Takeovers and Mergers and share Buy-backs issued by the Hong Kong Securities and Futures Commission and the fiduciary duties, have engaged in unfair prejudicial conducts in favor of Tianrui directly and indirectly through CSCGL which are detrimental to the interests of the shareholders including the Corporation. The Corporation filed a writ of summons to the High Court of Hong Kong in June 2017 and has been seeking legal advice in relation to the legal proceedings. As the respondents’ applications to strike out the petition for technical reasons, the Corporation amended the applications accordingly. Up to the date of the auditors’ report, no decision has been rendered down yet. The Corporation’s appointed attorney has been actively following up on the legal proceedings.
j. On April 17, 2019, CSCGL announced the result of winding-up petition at the news website of the Hong Kong Exchanges and Clearing Limited. According to the announcement, the Court of Appeal of the Cayman Islands declined to grant CSCGL’s application to set aside its decision. As a result, the winding-up petition against CSCGL will be reinstated and returned to the Grand Court of the Cayman Islands. As CSCGL and its legal counsel are considering all available options, the result of the winding-up petition remains uncertain. Considering that CSCGL is a listed company on the Hong Kong Exchanges and Clearing Limited and makes announcements to the public pursuant to the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited, the Corporation did not notice anything unusual in its operation according to its recent announcements. In addition, since no further decision has been rendered down yet, the Corporation considered it premature to evaluate at this stage the likely outcome of the proceedings. Therefore, the Corporation assessed that the winding-up petition did not have any material impact on its investments in CSCGL.

40. SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD

Since the outbreak of the Coronavirus Disease 2019 (COVID-19) epidemic in January 2020, the pandemic caused by the COVID-19 has certain impacts on the business operation and overall economy in different region and industries in the world. The Group will stay alert on the development and situation of the COVID-19 and take necessary action to mitigate the business risk.

41. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The Group’s significant financial assets and liabilities denominated in foreign currencies were as follows:

December 31, 2019

December 31, 2019
		Foreign		New Taiwan
	Currencies		Exchange Rate	Dollars
Financial assets
Monetary items
USD	$	905,675	29.93	$ 27,106,867
HKD		522,870	3.819	1,996,840
RMB		214,452	4.290	920,066
EUR		10,966	33.39	366,146
AUD		2,909	20.89	60,762
Non-monetary item
HKD		583,911	3.819	2,229,956
USD		21,138	29.93	632,669
RMB		48,665	4.290	208,787
				(Continued)

94 -

		Foreign		New Taiwan	New Taiwan
	Currencies		Exchange Rate		Dollars
Financial liabilities
Monetary items
USD		646,349	29.93		19,345,224
Non-monetary item
USD		3,744	29.93		112,070
					(Concluded)
December 31, 2018
		Foreign		New Taiwan
	Currencies		Exchange Rate		Dollars
Financial assets
Monetary items
RMB	$	309,127	4.468	$	1,381,194
USD		591,160	30.665		18,127,926
EUR		10,002	35		350,055
AUD		2,873	21.55		61,912
HKD		2,015	3.891		7,839
Non-monetary item
RMB		37,516	4.468		167,621
USD		804,287	30.665		24,663,454
HKD		618,269	3.891		2,405,686
Financial liabilities
Monetary items
USD		496,687	30.665		15,230,907
Non-monetary item
USD		8,747	30.665		268,218

For the years ended December 31, 2019 and 2018, the total amounts of realized and unrealized net foreign exchange (losses) gains were $(260,069) thousand and $90,672 thousand, respectively. It is impractical to disclose net foreign exchange losses by each significant foreign currency because of the variety of the foreign currency transactions and functional currencies of the Group.

42. SEPARATELY DISCLOSED ITEMS

a. Information about significant transactions and investees:
1) Financing provided to others (attached).
2) Endorsements/guarantees provided (Table 2) (attached).
3) Marketable securities held (excluding investments in subsidiaries, associates and joint ventures) (Table 3) (attached).
4) Marketable securities acquired or disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital (Table 4) (attached).
95 -
5)Acquisition of individual real estate at costs of at least NT$300 million or 20% of the paid-in capital: None.
6) Disposal of individual real estate at prices of at least NT$300 million or 20% of the paid-in capital: None.
7) Total purchases from or sales to related parties amounting to at least NT$100 million or 20% of the paid-in capital (Table 5) (attached).
8) Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital (Table 6) (attached).
9) Names, locations, and related information of investees on which the Corporation exercises significant influence (excluding investee companies in Mainland China): Table 7 (attached).
10) Trading in derivative instruments: Note 7.
b. Information on investments in mainland China
1) Information on any investee company in mainland China, showing the name, principal business activities, paid-in capital, method of investment, inward and outward remittance of funds, ownership percentage, net income of investees, investment income or loss, carrying amount of the investment at the end of the year, repatriations of investment income, and limit on the amount of investment in the mainland China area. (Table 8)
2) Any of the following significant transactions with investee companies in mainland China, either directly or indirectly through a third party, and their prices, payment terms, and unrealized gains or losses: Table 8.
- a) The amount and percentage of purchases and the balance and percentage of the related payables at the end of the year.
- b) The amount and percentage of sales and the balance and percentage of the related receivables at the end of the year.
- c) The amount of property transactions and the amount of the resultant gains or losses.
- d) The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the end of the year and the purposes.
- e) The highest balance, the ending balance, the interest rate range, and total current period interest with respect to the financing of funds.
- f) Other transactions that have a material effect on the profit or loss for the year or on the financial position, such as the rendering or receipt of services.
c. Business relationships and significant intercompany transactions: Table 9 (attached).
96 -

43. SEGMENT INFORMATION

Information reported to the chief operating decision maker for the purpose of resource allocation and assessment of segment performance focuses on the types of goods or services delivered or provided. The Group’s reportable segments were as follows: Cement, electric power, investment, engineering, transportation, stainless steel and leasing.

a. Segment revenue and results

Cement Electric power Investment Engineering Transportation Stainless steel Leasing Non-operating income and expenses Profit before income tax		Segment Revenue	Segment Revenue		Segment Profit	Segment Profit
		For the Year Ended December 31			For the Year Ended December 31
		2019 $ 73,848,951 7,115,116 628,361 183,836 1,751,160 5,438,907 381,306 $ 89,347,637	2018 $ 67,339,927 6,682,384 587,275 286,691 1,802,744 5,676,843 365,140 $ 82,741,004		2019 $ 19,974,112 1,382,268 135,767 14,266 268,969 84,752 203,042 22,063,176 6,330,006 $ 28,393,182	2018 $ 15,951,898 1,205,596 253,553 55,836 381,152 119,963 185,112 18,153,110 2,217,008 $ 20,370,118

Segment revenue reported above represents revenue generated from external customers.

b. Segment assets and liabilities, and other segment information

The Group does not report segment assets and liabilities or other segment information to the chief operating decision maker. Therefore, no information is disclosed here.

c. Geographical information

The Group operates principally in Taiwan and China.

The Groups’ revenue from external customers and information about its non-current assets by geographical location are detailed below.

China Taiwan Others	Revenue from External Customers For the Year Ended December 31 2019 2018 $ 56,614,196 $ 51,366,180 29,479,025 27,647,571 3,254,416 3,727,253 $ 89,347,637 $ 82,741,004	Revenue from External Customers For the Year Ended December 31 2019 2018 $ 56,614,196 $ 51,366,180 29,479,025 27,647,571 3,254,416 3,727,253 $ 89,347,637 $ 82,741,004		Non-current Assets	Non-current Assets
				December 31
		2019 $ 56,614,196 29,479,025 3,254,416 $ 89,347,637		2019 $ 41,506,113 53,160,799 4,280,703 $ 98,947,615	2018 $ 45,206,253 50,299,590 623,944 $ 96,129,787

Revenue is categorized according to customers’ location. Non-current assets exclude those classified as financial instruments, deferred tax assets and post-employment benefit assets.

97 -
d. Information of major customers

Information of major customers
Taiwan Power Company	Revenue
	For the Year Ended December 31
	2019 Amount % $ 7,115,116 8	2018
		Amount % $ 6,682,384 8

98 -

TABLE 1

ASIA CEMENT CORPORATION AND SUBSIDIARIES

FINANCING PROVIDED TO OTHERS YEAR ENDED DECEMBER 31, 2019

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

No.	Lender	Borrower	Financial Statement Account	Related Parties	Highest Balance for the Period	Ending Balance (Note 2)	Actual Borrowing Amount	Interest Rate (Note 3)	Nature of Financing	Business Transaction Amounts	Reasons for Short-term Financing	Allowance for Impairment Loss	Collateral	Collateral	Financing Limit for Each Borrower (Note 1)	Aggregate Financing Limits (Note 1)
													Item	Value
1	ACCHC	FENCC YDES	Other receivables Other receivables	Y Y	RMB431,900 thousand (equivalent to NT$1,852,987 thousand) RMB230,000 thousand (equivalent to NT$986,773 thousand)	$ - -	$ - -	- -	Necessary for short-term financing Necessary for short-term financing	$ - -	Operating capital Operating capital	$ - -	- -	$ - -	20% of net worth RMB2,852,760 thousand (equivalent to NT$12,239,242 thousand) Same as above	50% of net worth RMB7,131,901 thousand (equivalent to NT$30,598,109 thousand) Same as above
2	OIHPL	ACCHC	Other receivables	Y	RMB44,000 thousand (equivalent to NT$188,774 thousand)	RMB44,000 thousand (equivalent to NT$188,774 thousand)	RMB44,000 thousand (equivalent to NT$188,774 thousand)	4.14%	Necessary for short-term financing	-	Operating capital	-	-	-	20% of net worth RMB2,443,648 thousand (equivalent to NT$10,484,022 thousand)	50% of net worth RMB6,109,120 thousand (equivalent to NT$26,210,055 thousand)
3	OHC	SIYDCCL SLCL	Other receivables Other receivables	Y Y	RMB200,000 thousand (equivalent to NT$858,063 thousand) RMB350,000 thousand (equivalent to NT$1,501,611 thousand)	RMB200,000 thousand (equivalent to NT$858,063 thousand) RMB350,000 thousand (equivalent to NT$1,501,611 thousand)	- RMB190,000 thousand (equivalent to NT$815,160 thousand)	- 4.09%	Necessary for short-term financing Necessary for short-term financing	- -	Operating capital Operating capital	- -	- -	- -	20% of net worth RMB577,182 thousand (equivalent to NT$2,476,293 thousand) Same as above	50% of net worth RMB1,442,955 thousand (equivalent to NT$6,190,733 thousand) Same as above
4	JYDC	YYDCCL TZOCCL SIYDCCL SLCL SLCCL	Other receivables Other receivables Other receivables Other receivables Other receivables	Y Y Y Y Y	RMB160,000 thousand (equivalent to NT$686,451 thousand) RMB145,000 thousand (equivalent to NT$622,096 thousand) RMB100,000 thousand (equivalent to NT$429,032 thousand) RMB400,000 thousand (equivalent to NT$1,716,126 thousand) RMB35,000 thousand (equivalent to NT$150,161 thousand)	RMB140,000 thousand (equivalent to NT$600,644 thousand) RMB140,000 thousand (equivalent to NT$600,644 thousand) RMB50,000 thousand (equivalent to NT$214,516 thousand) RMB200,000 thousand (equivalent to NT$858,063 thousand) -	- RMB70,000 thousand (equivalent to NT$300,322 thousand) - - -	- 4.09% - - -	Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing	- - - - -	Operating capital Operating capital Operating capital Operating capital Operating capital	- - - - -	- - - - -	- - - - -	20% of net worth RMB1,202,402 thousand (equivalent to NT$5,158,685 thousand) Same as above Same as above Same as above Same as above	50% of net worth RMB3,006,005 thousand (equivalent to NT$12,896,711 thousand) Same as above Same as above Same as above Same as above
																(Continued)

99 -

No.	Lender	Borrower	Financial Statement Account	Related Parties	Highest Balance for the Period	Ending Balance (Note 2)	Actual Borrowing Amount	Interest Rate (Note 3)	Nature of Financing	Business Transaction Amounts	Reasons for Short-term Financing	Allowance for Impairment Loss	Collateral	Financing Limit for Each Borrower (Note 1)	Aggregate Financing Limits (Note 1)	No.
4	JYDC	SHYLCP ACCHC	Other receivables Other receivables	Y Y	RMB100,000 thousand (equivalent to NT$429,032 thousand) RMB700,000 thousand (equivalent to NT$3,003,221 thousand)	RMB90,000 thousand (equivalent to NT$386,128 thousand) RMB700,000 thousand (equivalent to NT$3,003,221 thousand)	RMB45,000 thousand (equivalent to NT$193,064 thousand) RMB700,000 thousand (equivalent to NT$3,003,221 thousand)	4.09% 2.94%	Necessary for short-term financing Necessary for short-term financing	$ - -	Operating capital Operating capital	$ - -	- -	$ - -	20% of net worth RMB1,202,402 thousand (equivalent to NT$5,158,685 thousand) Same as above	50% of net worth RMB3,006,005 thousand (equivalent to NT$12,896,711 thousand) Same as above
5	NYDC	SIYDCCL SLCL	Other receivables Other receivables	Y Y	RMB20,000 thousand (equivalent to NT$85,806 thousand) RMB30,000 thousand (equivalent to NT$128,709 thousand)	RMB20,000 thousand (equivalent to NT$85,806 thousand) RMB30,000 thousand (equivalent to NT$128,709 thousand)	- -	- -	Necessary for short-term financing Necessary for short-term financing	- -	Operating capital Operating capital	- -	- -	- -	20% of net worth RMB33,924 thousand (equivalent to NT$145,545 thousand) Same as above	50% of net worth RMB84,811 thousand (equivalent to NT$363,866 thousand) Same as above
6	HYDCCL	WYXC HXMC WYCPCL SLCL SYCPCL SIYDCCL ACCHC	Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables	Y Y Y Y Y Y Y	RMB60,000 thousand (equivalent to NT$257,419 thousand) RMB40,000 thousand (equivalent to NT$171,613 thousand) RMB35,000 thousand (equivalent to NT$150,161 thousand) RMB150,000 thousand (equivalent to NT$643,547 thousand) RMB50,000 thousand (equivalent to NT$214,516 thousand) RMB80,000 thousand (equivalent to NT$343,225 thousand) RMB400,000 thousand (equivalent to NT$1,716,126 thousand)	RMB20,000 thousand (equivalent to NT$85,806 thousand) RMB24,500 thousand (equivalent to NT$105,113 thousand) RMB20,000 thousand (equivalent to NT$85,806 thousand) RMB100,000 thousand (equivalent to NT$429,032 thousand) RMB20,000 thousand (equivalent to NT$85,806 thousand) - RMB400,000 thousand (equivalent to NT$1,716,126 thousand)	- RMB10,000 thousand (equivalent to NT$42,903 thousand) - - - - RMB400,000 thousand (equivalent to NT$1,716,126 thousand)	- 4.68% - - - - 2.94%	Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing	- - - - - - -	Operating capital Operating capital Operating capital Operating capital Operating capital Operating capital Operating capital	- - - - - - -	- - - - - - -	- - - - - - -	20% of net worth RMB523,594 thousand (equivalent to NT$2,246,384 thousand) Same as above Same as above Same as above Same as above Same as above Same as above	50% of net worth RMB1,308,985 thousand (equivalent to NT$5,615,959 thousand) Same as above Same as above Same as above Same as above Same as above Same as above
7	WYDC	WYXC WYCPCL	Other receivables Other receivables	Y Y	RMB70,000 thousand (equivalent to NT$300,322 thousand) RMB35,000 thousand (equivalent to NT$150,161 thousand)	RMB70,000 thousand (equivalent to NT$300,322 thousand) RMB25,000 thousand (equivalent to NT$107,258 thousand)	- -	- -	Necessary for short-term financing Necessary for short-term financing	- -	Operating capital Operating capital	- -	- -	- -	20% of net worth RMB121,817 thousand (equivalent to NT$522,633 thousand) Same as above	50% of net worth RMB304,543 thousand (equivalent to NT$1,306,586 thousand) Same as above

(Continued)

100 -

No.	Lender	Borrower	Financial Statement Account	Related Parties	Highest Balance for the Period	Ending Balance (Note 2)	Actual Borrowing Amount	Interest Rate (Note 3)	Nature of Financing	Business Transaction Amounts	Reasons for Short-term Financing	Allowance for Impairment Loss	Collateral	Collateral	Financing Limit for Each Borrower (Note 1)	Aggregate Financing Limits (Note 1)
													Item	Value
		SYCPCL SLCL	Other receivables Other receivables	Y Y	RMB40,000 thousand (equivalent to NT$171,613 thousand) RMB90,000 thousand (equivalent to NT$386,128 thousand)	RMB40,000 thousand (equivalent to NT$171,613 thousand) RMB90,000 thousand (equivalent to NT$386,128 thousand)	RMB40,000 thousand (equivalent to NT$171,613 thousand) -	4.09% -	Necessary for short-term financing Necessary for short-term financing	$ - -	Operating capital Operating capital	$ - -	- -	$ - -	20% of net worth RMB121,817 thousand (equivalent to NT$522,633 thousand) Same as above	50% of net worth RMB304,543 thousand (equivalent to NT$1,306,586 thousand) Same as above
8	CYCPCL	SIYDCCL SLCL	Other receivables Other receivables	Y Y	RMB12,000 thousand (equivalent to NT$51,484 thousand) RMB12,000 thousand (equivalent to NT$51,484 thousand)	RMB12,000 thousand (equivalent to NT$51,484 thousand) RMB12,000 thousand (equivalent to NT$51,484 thousand)	- -	- -	Necessary for short-term financing Necessary for short-term financing	- -	Operating capital Operating capital	- -	- -	- -	20% of net worth RMB16,455 thousand (equivalent to NT$70,597 thousand) Same as above	50% of net worth RMB41,138 thousand (equivalent to NT$176,495 thousand) Same as above
9	HGYDC	SIYDCCL SLCL	Other receivables Other receivables	Y Y	RMB50,000 thousand (equivalent to NT$214,516 thousand) RMB70,000 thousand (equivalent to NT$300,322 thousand)	RMB35,000 thousand (equivalent to NT$150,161 thousand) RMB70,000 thousand (equivalent to NT$300,322 thousand)	- -	- -	Necessary for short-term financing Necessary for short-term financing	- -	Operating capital Operating capital	- -	- -	- -	20% of net worth RMB254,209 thousand (equivalent to NT$1,090,637 thousand) Same as above	50% of net worth RMB635,524 thousand (equivalent to NT$2,726,599 thousand) Same as above
10	NYLC	SIYDCCL SLCL	Other receivables Other receivables	Y Y	RMB16,000 thousand (equivalent to NT$68,645 thousand) RMB16,000 thousand (equivalent to NT$68,645 thousand)	- -	- -	- -	Necessary for short-term financing Necessary for short-term financing	- -	Operating capital Operating capital	- -	- -	- -	20% of net worth RMB32,835 thousand (equivalent to NT$140,873 thousand) Same as above	50% of net worth RMB82,087 thousand (equivalent to NT$352,179 thousand) Same as above
11	SLCL	SLCCL	Other receivables	Y	RMB40,000 thousand (equivalent to NT$171,613 thousand)	RMB40,000 thousand (equivalent to NT$171,613 thousand)	RMB33,000 thousand (equivalent to NT$141,580 thousand)	4.09%	Necessary for short-term financing	-	Operating capital	-	-	-	20% of net worth RMB300,846 thousand (equivalent to NT$1,290,724 thousand)	50% of net worth RMB752,116 thousand (equivalent to NT$3,226,815 thousand)

Note 1: The net value was calculated based on audited financial statements as of December 31, 2019.

Note 2: The ending balance is the financing credit lines to the respective borrowers approved by the board of directors of lenders.

Note 3: The interest rate was for the year ended December 31, 2019.

Note 4: The foreign currency amounts are expressed in New Taiwan dollars at exchange rate as of December 31, 2019.

(Concluded)

101 -

TABLE 2

ASIA CEMENT CORPORATION AND SUBSIDIARIES

ENDORSEMENTS/GUARANTEES PROVIDED YEAR ENDED DECEMBER 31, 2019 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

No.	Endorser/ Guarantor	Endorsee/Guarantee	Endorsee/Guarantee	Limits on Each Endorsement/ Guarantee Given on Behalf of Each Party (Note 1)	Maximum Amount Endorsed/ Guaranteed During the Period	Outstanding Endorsement/ Guarantee at the End of the Period	Actual Borrowing Amount	Amount Endorsed/ Guaranteed by Collaterals	Ratio of Accumulated Endorsement/ Guarantee to Net Equity in Latest Financial Statements (%)	Aggregate Endorsement/ Guarantee Limit (Note 1)	Endorsement/ Guarantee Given by Parent on Behalf of Subsidiaries	Endorsement/ Guarantee Given by Subsidiaries on Behalf of Parent	Endorsement/ Guarantee Given on Behalf of Companies in Mainland China
		Name	Relationship (Note 3)
0	The Corporation	AIC DCI FSMS NHC AEE YLPPC YSRMC YTRMC	b b b b b b b b	50% of net worth ($73,033,679 thousand) Same as above Same as above Same as above Same as above Same as above Same as above Same as above	$ 12,227,000 9,856,750 30,000 1,516,300 422,880 497,642 150,000 1,000,000	$ 12,195,800 9,848,950 30,000 1,509,020 329,930 497,642 150,000 1,000,000	$ 6,890,000 4,952,000 30,000 420,000 150,000 137,757 - -	None None None None None None None None	8.35 6.74 0.02 1.03 0.23 0.34 0.10 0.68	100% of net worth ($146,067,358 thousand) Same as above Same as above Same as above Same as above Same as above Same as above Same as above	Y Y Y Y Y Y Y Y	- - - - - - - -	- - - - - - - -
1	DCI	FSMS	b	50% of net worth ($6,828,783 thousand)	50,000	50,000	10,000	None	0.37	100% of net worth ($13,657,566 thousand)	Y	-	-
2	AOG	AOC	b	50% of net worth (US$1,146 thousand) (equivalent to NT$34,305 thousand)	15,775	14,965	-	None	21.81	100% of net worth (US$2,292 thousand) (equivalent to NT$68,610 thousand)	Y	-	-
3	YLSS	YLSS	-	50% of net worth ($902,155 thousand)	100,000	100,000	30,000	100,000	5.54	100% of net worth ($1,804,309 thousand)	-	-	-
4	YTRMC	AOC	b	50% of net worth ($900,885 thousand)	15,775	14,965	-	None	0.83	100% of net worth ($1,801,770 thousand)	Y	-	-

Note 1: The net value was calculated based on audited financial statements as of December 31, 2019.

Note 2: The foreign currency amounts are expressed in New Taiwan dollars at exchange rate as of December 31, 2019.

Note 3: The relationship between guarantor and guarantee are as follows:

a. Firms that do business with the Corporation.
b. Firms of which the Corporation holds, directly or indirectly, over 50% of the voting shares.
102 -

TABLE 3

ASIA CEMENT CORPORATION AND SUBSIDIARIES

MARKETABLE SECURITIES HELD DECEMBER 31, 2019 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account		December 31, 2019	December 31, 2019		Note
				Shares or Units	Carrying Amount	Percentage of Ownership (%)	Fair Value
The Corporation DCI	Beneficiary certificates Deutsche Far Eastern DWS Taiwan Flagship Security Investment Trust Fund Ordinary shares China Conch Venture Holding Far EasTone Far Eastern Department Stores Ltd. Oriental Union Chemical Corp. CHC Resources Corporation Far Eastern International Bank Kaohsiung Rapid Transit Taiwan Stock Exchange Corp. Ding Ding Hotel Corp. L’ Hotel de Chine Hotel China Trade & Development Corp. Pan Asia Engineers & Constructors Corp. Linkou Recreation Corporation China Shanshui Investment Corp Beneficiary certificates Polaris Taiwan Top 50 Tracker Fund Mega Target Return Strategy Fund of ETF Funds ChinaAMC CSI 300 Index ETF Opas Fund Segregated Portfolio Tranche A Ordinary shares Industrial and Commercial Bank of China, A share China Mobile Communications Corporation Haitong Securities Co., Ltd. Taiwan Cement Co., Ltd. Hsing Ta Cement Co., Ltd. Chunghwa Picture Tubes, Ltd. Innolux Corporation Pegatron Corporation Tong Yang Industry Co., Ltd E Ink Holdings corporation Hiwin Technologies Corporation Accton Technology Corporation Casetek Holdings Limited China Life Insurance Company Limited, H share	- - The same chairman The same chairman The same chairman The Corporation is its director The chairman of the Corporation is its vice-chairman - - Related party in substance - - The Corporation is its director - - - - - Related party in substance - - - - - - - - - - - - - -	Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - noncurrent Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Financial assets at fair value through profit or loss - current Same as above Same as above Same as above Financial assets at fair value through profit or loss - current Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Financial assets at fair value through other comprehensive income - current Same as above	10,000,000 11,443,000 31,034,372 80,052,950 63,766,522 22,801,185 78,878,582 15,873,243 8,430,368 555,638 598,121 250,003 1,551,395 5 49,928 400,000 1,000,811 540,000 8,000 2,000,000 210,000 1,800,000 8,796,722 6,504,854 275,223 9,200,000 1,242,000 1,732,000 1,130,000 60,000 150,000 1,050,000 607,000	$ 204,700 1,485,828 2,237,578 2,085,379 1,339,097 1,146,900 942,599 78,630 466,199 5,340 14,469 3,902 17,919 - 488,258 38,780 10,620 95,689 273,741 50,454 52,530 63,311 384,417 130,748 - 76,636 84,953 80,798 35,313 16,860 25,200 49,718 50,188	- 0.63 0.95 5.65 7.20 9.17 2.35 5.70 1.16 0.53 0.31 0.38 1.36 0.50 4.99 - - 0.20 - - - 0.02 0.16 1.90 - 0.09 0.05 0.29 0.10 0.02 0.03 0.25 -	$ 204,700 1,485,828 2,237,578 2,085,379 1,339,097 1,146,900 942,599 78,630 466,199 5,340 14,469 3,902 17,919 - 488,258 38,780 10,620 95,689 273,741 50,454 52,530 63,311 384,417 130,748 - 76,636 84,953 80,798 35,313 16,860 25,200 49,718 50,188	Note 4

(Continued)

103 -

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account		December 31, 2019	December 31, 2019		Note
				Shares or Units	Carrying Amount	Percentage of Ownership (%)	Fair Value
NHC YTRMC FMT FDT AEE YLPPC AIC	Far Eastern International Bank Oriental Union Chemical Corp. Far EasTone Mega Financial Holding Co., Ltd. Lite-On Technology Corporation Tripod Technology Corporation WPG Holdings Limited Far Eastern International Bank Far Eastern Department Stores Ltd. Oriental Union Chemical Corp. CHC Resources Corporation Picvue Electronics Co., Ltd. Ding Ding Hotel Corp. Far Eastern International Leasing Corporation Ordinary shares Far EasTone Ordinary shares Far EasTone Ordinary shares Everest Textile Co., Ltd. Oriental Union Chemical Corp. Far Eastern Department Store Ltd. Yi Tong Fiber Co., Ltd. Ordinary shares Far Eastern International Bank Far Eastern Department Store Ltd. Oriental Union Chemical Corp. Ding & Ding Management Consultants Co., Ltd. Ordinary shares Far EasTone Ding & Ding Management Consultants Co., Ltd. Ordinary shares Far EasTone Yamay International Development Corp. Beneficiary certificates Opas Fund Segregated Portfolio Tranche E ChinaAMC CSI 300 Index ETF	The chairman of the Corporation’s major shareholder is its vice-chairman Same chairman with the major shareholder Same chairman with the major shareholder - - - - The chairman of the Corporation’s major shareholder is its vice-chairman The same chairman The same chairman The Corporation is its director - Same chairman with the major shareholder The Corporation is its director Same chairman with the major shareholder Same chairman with the major shareholder The chairman of the Corporation is its chairman The chairman of the Corporation is its director Same chairman with the major shareholder - The chairman of the Corporation is its vice-chairman by the ultimate parent company The chairman of the Corporation is its vice-chairman Same chairman with the ultimate parent company - Same chairman with the major shareholder - The director of the Corporation is its chairman - Related party in substance -	Financial assets at fair value through other comprehensive income - current Same as above Same as above Same as above Same as above Same as above Same as above Financial assets at fair value through other comprehensive income - noncurrent Same as above Same as above Same as above Same as above Same as above Same as above Financial assets at fair value through profit or loss - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - noncurrent Same as above Same as above Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - noncurrent Same as above Same as above Financial assets at fair value through profit or loss - current Financial assets at fair value through other comprehensive income - noncurrent Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - noncurrent Financial assets at fair value through profit or loss - current Same as above	37,693,157 41,246 215,000 9,958,000 299,000 261,000 340,000 97,439,707 13,630,966 10,506,792 4,812,514 161,700 213,442 45,258,938 50,000 230,000 13,279,219 2,256,782 1,185,713 5,256,454 296,017 935,029 3,254,125 866,730 120,000 273,024 105,000 15 3,973 1,000,000	$ 450,433 866 15,502 304,715 14,756 32,756 13,294 1,164,404 355,087 220,643 242,069 - 2,051 602,813 3,605 16,583 121,372 47,392 30,888 41,691 3,537 24,358 68,337 8,376 8,652 900 7,571 - 156,299 177,202	1.12 - 0.01 0.07 0.01 0.05 0.02 2.90 0.96 1.19 1.94 0.06 0.21 10.14 - - 2.60 0.25 0.08 5.94 0.01 0.07 0.37 16.00 - 5.04 - - - 0.37	$ 450,433 866 15,502 304,715 14,756 32,756 13,294 1,164,404 355,087 220,643 242,069 - 2,051 602,813 3,605 16,583 121,372 47,392 30,888 41,691 3,537 24,358 68,337 8,376 8,652 900 7,571 - 156,299 177,202	Note 5

(Continued)

104 -

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account		December 31, 2019	December 31, 2019		Note
				Shares or Units	Carrying Amount	Percentage of Ownership (%)	Fair Value
Asia Cement Pioneer Investment Ltd. FSMS YLT YLSS KCC KCCL	Ordinary shares Hsing Ta Cement Co., Ltd Foxconn Technology Co., Ltd Taiwan Cement Co., Ltd. Quanta Computer Inc. Pegatron Corporation Hon Hai Precision Industry Co., Ltd. China Construction Bank Corporation, A share China Life Insurance Company Limited, H share China Mobile Communications Corporation Hiwin Technologies Corporation Accton Technology Corporation Far EasTone Casetek Holdings Limited Nan Ya Plastics Corporation Inventec Corporation China Life Insurance Company Limited, A share China Life Insurance Company Limited, H share Lite-On Technology Corporation Tripod Technology Corporation WPG Holdings Limited Far Eastern International Bank Oriental Union Chemical Corp. Far Eastern Department Store Ltd. Ding Shen Investment Co., Ltd. Hsin Nsn Construction Co., Ltd. Ordinary shares Cementon Micronesia L.L.C. Ordinary shares Stone Industry Resource System Corp Beneficiary certificates Polaris Taiwan Top 50 Tracker Fund Ordinary shares Far Eastern International Bank Far EasTone Ordinary shares Far EasTone Beneficiary certificates CSOP FTSE China A50 ETF Beneficiary certificates Allianz US High Yield Fund Opas Fund Segregated Portfolio Tranche C	- - - - - - - - - - - Same chairman with the major shareholder - - - - - - - - The chairman of the Corporation’s major shareholder is its vice-chairman Same chairman with the major shareholder Same chairman with the major shareholder The Corporation is its director - - - - The chairman of the Corporation’s major shareholder is its vice-chairman Same chairman with the major shareholder Same chairman with the major shareholder - - Related party in substance	Financial assets at fair value through profit or loss - current Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Financial assets at fair value through other comprehensive income - current Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Financial assets at fair value through other comprehensive income - noncurrent Same as above Same as above Same as above Same as above Financial assets at fair value through other comprehensive income - noncurrent Financial assets at fair value through other comprehensive income - noncurrent Financial assets at fair value through profit or loss - current Financial assets at fair value through other comprehensive income - noncurrent Same as above Financial assets at fair value through other comprehensive income - current Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current Same as above	10,834,650 2,043,000 389,519 525,000 825,000 1,720,000 2,500,000 1,350,000 448,000 38,000 150,000 1,426,303 1,000,000 3,286,000 2,882,000 540,000 986,000 136,000 100,000 340,000 135,149,123 1,552,156 4,473,972 39,600,000 2,696 (Note 1) 10,000 350,000 3,020,872 71,099 130,000 300,000 97,741 1,606	$ 217,776 135,247 17,022 33,758 56,430 156,176 77,548 111,620 112,065 10,678 25,200 102,836 47,350 239,221 65,854 80,786 81,524 6,712 12,550 13,294 1,615,032 32,595 116,547 372,240 - 116,727 70 33,933 36,099 5,126 9,373 17,438 21,147 70,827	3.17 0.14 0.01 0.01 0.03 0.01 - - - 0.01 0.03 0.04 0.24 0.04 0.08 - - 0.01 0.02 0.02 4.03 0.18 0.32 18.00 - 10.00 0.15 - 0.09 - - - - -	$ 217,776 135,247 17,022 33,758 56,430 156,176 77,548 111,620 112,065 10,678 25,200 102,836 47,350 239,221 65,854 80,786 81,524 6,712 12,550 13,294 1,615,032 32,595 116,547 372,240 - 116,727 70 33,933 36,099 5,126 9,373 17,438 21,147 70,827	Note 6

(Continued)

105 -

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account		December 31, 2019	December 31, 2019		Note
				Shares or Units	Carrying Amount	Percentage of Ownership (%)	Fair Value
ACSPL OCPL	Beneficiary certificates United Emerging Markets Bond Funds United Growth Fund Ordinary shares DBS Group Guocoland Ltd. Hong Leong Asia INTRACO Engro Corp Ltd. Ordinary shares Hiap Hoe Ltd.	- - - - - - - -	Financial assets at fair value through profit or loss - current Same as above Financial assets at fair value through profit or loss - current Same as above Same as above Same as above Same as above Financial assets at fair value through profit or loss - current	3,232,758 745,068 33,436 26,666 20,000 46,875 2,000 44,260	$ 93,112 60,131 19,202 1,160 297 296 43 786	- - - - - - - -	$ 93,112 60,131 19,202 1,160 297 296 43 786

Note 1: This is not a company limited by shares.

Note 2: Marketable securities in this table are shares, bonds, beneficiary certificates and securities derived from these items under IFRS 9 “Financial Instruments: Recognition and Measurement”.

Note 3: The carrying amounts of financial instruments measured at fair values are adjusted for fair value less accumulated impairment loss; the carrying amounts of financial instruments not measured at fair values are the original cost or amortized cost less accumulated impairment loss.

Note 4: 14,500 thousand shares ($1,045,450 thousand) of the securities are pledged as collaterals for bank loans of the Corporation.

Note 5: 5,000 thousand shares ($130,250 thousand) of the securities are pledged as collaterals for bank loans of DCI.

Note 6: 3,500 thousand shares ($91,175 thousand) of the securities are pledged as collaterals for bank loans of AIC.

(Concluded)

106 -

TABLE 4

ASIA CEMENT CORPORATION AND SUBSIDIARIES

MARKETABLE SECURITIES ACQUIRED AND DISPOSED OF AT COSTS OR PRICES OF AT LEAST NT$300 MILLION OR 20% OF THE PAID-IN CAPITAL YEAR ENDED DECEMBER 31, 2019

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Company Name	Type and Name of Marketable Securities (Note 1)	Financial Statement Account	Counterparty (Note 2)	Relationship (Note 2)	Beginning Balance	Beginning Balance	Acquisition (Note 3)	Acquisition (Note 3)		Disposal (Note 3)	Disposal (Note 3)		Ending	Balance
					Shares/Units	Amount	Shares/Units	Amount	Shares/Units	Amount	Carrying Value	Gain (Loss) on Disposal	Shares/Units	Amount
ACCHC PIHPL OIH OHC ACSPL DCI AIC Mega Mega IV Leap	Ordinary shares PIHPL Ordinary shares OIH Ordinary shares OHC Ordinary shares YDES Beneficiary certificates Opas Fund Segregated Portfolio Tranche D Beneficiary certificates Opas Fund Segregated Portfolio Tranche D Beneficiary certificates Opas Fund Segregated Portfolio Tranche D Beneficiary certificates Opas Fund Segregated Portfolio Tranche D Beneficiary certificates Opas Fund Segregated Portfolio Tranche D Beneficiary certificates Opas Fund Segregated Portfolio Tranche D	Investments in subsidiaries Investments in subsidiaries Investments in subsidiaries Investments accounted for using the equity method Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current	Proceeds from issuance of ordinary shares Proceeds from issuance of ordinary shares Proceeds from issuance of ordinary shares Proceeds from issuance of ordinary shares - - - - - -	Subsidiaries Subsidiaries Subsidiaries Associates - - - - - -	9,379,303 700,709,352 (Note 1) (Note 1) 19,000 56,000 58,000 - - -	US$ 2,165,969 thousand US$ 1,473,705 thousand RMB 813,357 thousand - 580,194 1,716,669 1,777,798 - - -	340,232 (Note 2) - - - 94 - 9,601 9,601 9,601	US$ 73,781 thousand US$ 73,781 thousand RMB 500,000 thousand RMB 714,190 thousand - 2,869 - 294,286 294,286 294,286	- - - - 19,000 56,094 58,000 9,601 9,601 9,601	$ - - - - 612,797 1,805,004 1,863,752 296,073 296,073 296,073	$ - - - - 583,562 1,716,469 1,774,800 294,286 294,286 294,286	$ - - - - 29,235 88,536 88,952 1,787 1,787 1,787	9,719,535 (Note 2) 700,709,352 (Note 2) (Note 1) (Note 1) - - - - - -	US$ 2,484,649 thousand US$ 1,751,418 thousand RMB 2,885,909 thousand RMB 706,643 thousand - - - - - -

Note 1: This is not a company limited by shares.

Note 2: The cash capital increment was not registered yet.

107 -

TABLE 5

ASIA CEMENT CORPORATION AND SUBSIDIARIES

TOTAL PURCHASE FROM OR SALE TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL YEAR ENDED DECEMBER 31, 2019

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Purchasing or (Selling) Company Name	Related Party	Relationship		Transaction Details	Transaction Details	Transaction Details	Abnormal Transaction	Abnormal Transaction	Notes/Accounts (Payable) or Receivable	Notes/Accounts (Payable) or Receivable	Note
			Purchase (Sale)	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
The Corporation ACSPL YTRMC FMT FDT YSRMC YLPPC NHC YLT YTV JYDC	YTRMC ACSPL YSRMC U-Ming U-Ming Singapore YLT NHC Alliance Concrete Singapore Pte. Ltd. The Corporation Far Eastern General Construction Inc. Far Eastern Resources Development Co. The Corporation CHC Resources Corporation Air Liquide Far Eastern Co. FENC OUCC Oriental Petrochemical (Taiwan) Co., Ltd. Chubei New Century Shopping Mall Co., Ltd. The Corporation Far Eastern General Construction Inc. The Corporation The Corporation Far Eastern Polytex Vietnam Ltd. TZOCCL WYDC YYDCCL NYDC	A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation An investee accounted for by equity method A subsidiary of an investee accounted for by equity method A subsidiary of the Corporation A subsidiary of the Corporation An investee accounted for by equity method Parent company Related party in substance Related party in substance Parent company Related party in substance Related party in substance An investee accounted for by equity method Related party in substance Related party in substance Related party in substance Parent company Related party in substance Parent company Parent company A subsidiary of an investee accounted for by equity method The same ultimate parent company The same ultimate parent company The same ultimate parent company A subsidiary of the Corporation	Sales Sales Sales Sales freight expense Sales freight expense Sales freight expense Purchase Sales Purchase Sales Sales Purchase Purchase Sales Sales Sales Sales Sales Purchase Sales Sales Sales Sales Sales Sales Sales Sales	$ (1,805,262) (522,223) (163,476) 551,952 186,958 176,539 151,293 SGD (28,215) thousand SGD 23,042 thousand (430,434) (104,551) 1,805,262 466,075 (156,034) (207,509) (133,627) (176,300) (104,908) 163,476 (116,783) (151,293) (176,539) VND (79,774,106) thousand RMB (240,626) thousand RMB (212,481) thousand RMB (552,419) thousand RMB (92,202) thousand	(20) (6) (2) 6 2 2 2 (78) 63 (5) (1) 21 5 (14) (19) (12) (20) (15) 25 (66) (40) (98) (82) (5) (4) (11) (2)	Purchase 45 days after monthly closing Average 30 days Purchase 45 days after monthly closing Average 60 days Average 10 days Average 30 days Purchase 45 days after monthly closing Average 60 days Average 30 days Average 90 days Average 90 days Purchase 45 days after monthly closing Purchase 45 days after monthly closing Purchase 120 days after monthly closing Purchase 60 days after monthly closing Purchase 75 days after monthly closing 110 days Average 60 days Purchase 45 days after monthly closing Average 90 days Purchase 45 days after monthly closing 30 days Within 45 days Within 90 days Average 30 days Within 90 days Average 30 days	$ - - - - - - - - - - - - - - - - - - - - - - - - - - -	- - - - - - - - - - - - - - - - - - - - - - - - - - -	$ 348,664 38,621 34,114 (66,176) - (31,883) (28,431) SGD 6,247 thousand SGD (1,740) thousand 213,416 76,481 (348,664) (64,488) 52,734 27,527 23,895 55,066 19,648 (34,114) 35,542 28,431 31,883 VND 26,936,744 thousand RMB 34,873 thousand RMB 37,902 thousand RMB 31,765 thousand RMB 16,285 thousand	33 4 3 (4) - (2) (2) 83 (28) 6 2 (24) (4) 25 13 11 46 8 (30) 34 33 99 87 4 5 4 2

(Continued)

108 -

Purchasing or (Selling) Company Name	Related Party	Relationship		Transaction Details	Transaction Details	Transaction Details	Abnormal Transaction	Abnormal Transaction	Notes/Accounts (Payable) or Receivable	Notes/Accounts (Payable) or Receivable	Note
			Purchase (Sale)	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
NYDC NYLC TZOCCL WYDC YYDCCL HYDCCL	NYLC HYDCCL RYNM JYLTC WAMTC NYDC NYLC HGYDC JYDC JYDC JYDC JYDC JYDC YYDCCL JYDC HYDCCL TZOCCL JYDC WAMTC WYDC WYCPCL HZYCCL JYDC HGYDC WAMTC HXMC	A subsidiary of the Corporation The same ultimate parent company A subsidiary of the Corporation A subsidiary of the Corporation An investee accounted for by equity method A subsidiary of the Corporation A subsidiary of the Corporation The same ultimate parent company Parent company Parent company Parent company Parent company The same ultimate parent company The same ultimate parent company The same ultimate parent company The same ultimate parent company The same ultimate parent company The same ultimate parent company An investee accounted for by equity method The same ultimate parent company The same ultimate parent company An investee accounted for by equity method The same ultimate parent company The same ultimate parent company An investee accounted for by equity method An investee accounted for by equity method	Sales Sales Sales Sales freight expense Sales freight expense Purchase Purchase Purchase Sales Purchase Sales Purchase Purchase Purchase Purchase Purchase Sales Purchase Sales freight expense Sales Sales Sales Purchase Purchase Sales freight expense Purchase	RMB (33,435) thousand RMB (49,612) thousand RMB (23,366) thousand RMB 52,041 thousand RMB 76,408 thousand RMB 294,343 thousand RMB 28,776 thousand RMB 24,880 thousand RMB (294,343) thousand RMB 92,202 thousand RMB (28,776) thousand RMB 33,435 thousand RMB 240,626 thousand RMB 29,860 thousand RMB 212,481 thousand RMB 25,704 thousand RMB (29,860) thousand RMB 552,419 thousand RMB 25,879 thousand RMB (25,704) thousand RMB (44,639) thousand RMB (32,231) thousand RMB 49,612 thousand RMB 86,691 thousand RMB 33,759 thousand RMB 22,650 thousand	(1) (1) - 2 2 10 1 1 (100) 35 (17) 23 85 11 63 8 (3) 70 3 (2) (3) (2) 5 8 3 2	Average 30 days Within 90 days Average 30 days Within 90 days Within 90 days Average 30 days Average 30 days Average 30 days Average 30 days Average 30 days Average 30 days Average 30 days Within 90 days Within 90 days Average 30 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days	$ - - - - - - - - - - - - - - - - - - - - - - - - - -	- - - - - - - - - - - - - - - - - - - - - - - - - -	RMB 6,503 thousand RMB 12,304 thousand RMB 3,856 thousand RMB (14,608) thousand RMB (19,484) thousand RMB (45,705) thousand RMB (2,475) thousand RMB (7,370) thousand RMB 45,705 thousand RMB (16,285) thousand RMB 2,475 thousand RMB (6,503) thousand RMB (34,873) thousand RMB (912) thousand RMB (37,902) thousand RMB (280) thousand RMB 912 thousand RMB (31,765) thousand RMB (2,885) thousand RMB 280 thousand RMB 14,085 thousand RMB 14,906 thousand RMB (12,304) thousand RMB (9,658) thousand - RMB (1,856) thousand	1 1 - (8) 11 (25) (1) (4) 100 (58) 2 (31) (92) (2) (59) - 1 (64) (6) - 4 4 (14) (11) - (2)

(Continued)

109 -

Purchasing or (Selling) Company Name	Related Party	Relationship		Transaction Details	Transaction Details	Transaction Details	Abnormal Transaction	Abnormal Transaction	Notes/Accounts (Payable) or Receivable	Notes/Accounts (Payable) or Receivable	Note
			Purchase (Sale)	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
WYCPCL SIYDCCL HGYDC SLCL SYCPCL JYLTC SYTCL RYNM	HYDCCL SLCL SYCPCL HYDCCL JYDC SYCPCL SIYDCCL SYTCL SLCL SIYDCCL JYDC SLCL JYDC	The same ultimate parent company A subsidiary of the Corporation The same ultimate parent company The same ultimate parent company The same ultimate parent company The same ultimate parent company Parent company The same ultimate parent company The same ultimate parent company The same ultimate parent company Parent company The same ultimate parent company Parent company	Purchase Sales Sales Sales Sales Sales Purchase Purchase Purchase Purchase Sales Sales Purchase	RMB 44,639 thousand RMB (81,058) thousand RMB (27,616) thousand RMB (86,691) thousand RMB (24,880) thousand RMB (23,395) thousand RMB 81,058 thousand RMB 43,424 thousand RMB 23,395 thousand RMB 27,616 thousand RMB (52,041) thousand RMB (43,424) thousand RMB 23,366 thousand	30 (4) (1) (10) (3) (2) 10 5 9 11 (63) (56) 100	Within 90 days Within 90 days Within 90 days Within 90 days Average 30 days Within 90 days Within 90 days Within 90 days Average 30 days Within 90 days Within 90 days Within 90 days Average 30 days	$ - - - - - - - - - - - - -	- - - - - - - - - - - - -	RMB (14,085) thousand RMB 7,306 thousand RMB 8,710 thousand RMB 9,658 thousand RMB 7,370 thousand RMB 22,603 thousand RMB (7,306) thousand RMB (6,162) thousand RMB (22,603) thousand RMB (8,710) thousand RMB 14,608 thousand RMB 6,162 thousand RMB (3,856) thousand	(43) 1 1 18 14 3 (15) (12) (24) (9) 62 24 (99)

(Concluded)

110 -

TABLE 6

ASIA CEMENT CORPORATION AND SUBSIDIARIES

RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL YEAR ENDED DECEMBER 31, 2019

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Company Name	Related Party	Relationship	Ending Balance	Turnover Rate	Overdue	Overdue	Amounts Received in Subsequent Period	Allowance for Impairment Loss
					Amount	Action Taken
The Corporation ACSPL YTRMC JYDC NYDC OIH OHC SLCL WYDC HYDCCL	YTRMC Alliance Concrete Singapore Pte. Ltd. Far Eastern General Construction Inc. TZDC WYDC YYDCCL ACCHC SHYLCP TZOCCL JYDC ACCHC SLCL SLCCL SYCPCL ACCHC	A subsidiary of the Corporation An investee accounted for by equity method Related party in substance The same ultimate parent company The same ultimate parent company The same ultimate parent company Parent company The same ultimate parent company The same ultimate parent company Parent company Parent company The same ultimate parent company A subsidiary of the Corporation The same ultimate parent company Parent company	$ 348,664 SGD 6,247 thousand 213,416 RMB 34,873 thousand RMB 37,902 thousand RMB 31,765 thousand RMB 700,000 thousand RMB 45,000 thousand RMB 70,000 thousand RMB 45,705 thousand RMB 44,000 thousand RMB 190,000 thousand RMB 33,000 thousand RMB 40,000 thousand RMB 400,000 thousand	5.02 times 4.25 times 1.75 times 6.92 times 6.71 times 16.52 times Note 1 Note 1 Note 1 6.77 times Note 1 Note 1 Note 1 Note 1 Note 1	$ - - - - - - - - - - - - - - -	- - - - - - - - - - - - - - -	$ 5,386 SGD 6,247 thousand 121,620 RMB 30,032 thousand - RMB 23,692 thousand - - - RMB 45,705 thousand - RMB 90,000 thousand - - -	$ - - - - - - - - - - - - - - -

Note 1: The accounts receivable from financing.

111 -

TABLE 7

ASIA CEMENT CORPORATION AND SUBSIDIARIES

NAMES, LOCATIONS, AND OTHER INFORMATION OF INVESTEES ON WHICH THE CORPORATION EXERCISES SIGNIFICANT INFLUENCE (EXCLUDING INVESTMENT IN MAINLAND CHINA) YEAR ENDED DECEMBER 31, 2019

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Investor Company	Investee Company	Location	Main Businesses and Products	Investment Amount	Investment Amount	Balance	as of December 31, 2019	as of December 31, 2019	Net Income (Loss) of the Investee	Share of Profits (Loss)	Note
				December 31, 2019	December 31, 2018	Shares	Percentage of Ownership	Carrying Value
The Corporation DCI	ACCHC FENC U-Ming DCI CHP YDC YYI ACSPL OSC AIC YTRMC YLSS FMT FEDSDL NHC YDLC YLT AEE EISF YLPPC SIHL CSCGL YDC FEC FENC KCC SHSTC FSMS U-Ming AC Mega Investment Ltd. AC Leap Investment Ltd. AC Mega II Investment Ltd.	Cayman Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Singapore Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan B.V.I. Cayman Taiwan Taiwan Taiwan Hong Kong Taiwan Taiwan Taiwan B.V.I. B.V.I. B.V.I.	Investment Textile Marine transportation Investment Power plant Investment Investment Cement Broker Investment Ready-mixed concrete, cement - related products Stainless steel Transportation Retails Cement, granulated blast-furnace slag Leasing Transportation Engineering Iron and steel Cement - related products Investment Investment Investment Construction Textile Cement Storage and transportation Mining excavation, mineral processing and sales Marine transportation Investment Investment Investment	$ 13,660,636 3,459,787 510,236 2,555,255 3,119,492 2,232,220 911,058 186,958 154,207 1,212,679 1,042,252 2,661,240 68,416 500,000 410,994 309,049 22,110 5,136 31,463 144,961 2,898 4,821,008 289,982 140,138 1,263,385 36,024 - 112,096 27,619 828,313 846,224 289,050	$ 13,660,636 3,459,787 510,236 2,555,255 3,119,492 2,232,220 911,058 186,958 154,207 1,212,679 1,042,252 2,661,240 68,416 500,000 410,994 309,049 22,110 5,136 31,463 144,961 2,898 4,821,008 289,982 140,138 1,263,385 36,024 143,516 112,096 27,619 579,926 579,439 289,050	1,061,209,202 1,272,277,085 331,701,152 595,576,603 280,093,521 178,707,648 155,000,803 10,495,495 135,092,154 222,039,596 159,067,779 200,000,000 29,517,188 53,250,000 26,128,171 34,640,189 5,100,000 7,970,703 3,199,823 16,241,083 90,000 331,878,315 72,989,090 115,882,928 82,812,887 1,127,000 - 1,294,270 468,486 27,700,000 28,300,000 10,000,000	67.73 23.77 39.25 99.99 59.59 35.50 29.92 99.96 18.93 100.00 99.99 100.00 99.82 25.00 99.94 43.60 51.00 98.23 40.40 83.81 100.00 7.62 14.50 33.76 1.55 49.00 - 99.56 0.06 100.00 100.00 100.00	$ 41,411,828 39,074,139 10,462,271 13,656,200 6,059,603 3,218,379 2,560,533 4,142,011 1,921,049 3,256,199 1,801,770 1,969,817 1,410,458 640,867 261,372 373,481 265,154 182,274 80,652 75,594 54,922 5,248,933 1,320,548 4,402,354 2,509,521 446,154 - 133,735 30,967 774,004 855,589 281,337	$ 14,106,889 10,732,669 1,621,695 1,262,905 1,097,061 214,541 811,808 693,709 250,003 977,016 146,801 1,347 213,189 152,284 52,531 12,144 22,796 59,946 14,020 1,040 3,038 13,578,105 214,541 725,256 10,732,669 40,881 - (6,936) 1,621,695 86,138 100,918 46,877	$ 9,554,596 1,637,898 636,545 1,262,788 653,769 67,561 242,893 693,431 47,326 977,016 146,801 (6,939) 213,363 56,887 52,499 5,295 11,626 58,885 5,664 871 3,038 965,182 Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable	A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation

(Continued)

112 -

Investor Company	Investee Company	Location	Main Businesses and Products	Investment Amount	Investment Amount	Balance	as of December 31, 2019	as of December 31, 2019	Net Income (Loss) of the Investee	Share of Profits (Loss)	Note
				December 31, 2019	December 31, 2018	Shares	Percentage of Ownership	Carrying Value
NHC YTRMC FMT FDT AEE YLPPC AIC	AC Mega III Investment Ltd. AC Mega IV Investment Ltd. Drive Catalyst SPC - SP Tranche One Drive Catalyst SPC - SP Tranche Three CSCGL SHSTC PGIC FENC U-Ming CSCGL YSRMC YTV PYCI AOG FDT FENC YDEC U-Ming FENC ACCHC U-Ming CSCGL YDEC PYCI YLPCIP AOG FENC U-Ming CHP Asia Cement Pioneer Investment Ltd. Asia Cement Pioneer II Investment Ltd. Asia Cement Pioneer III Investment Ltd. Asia Cement Pioneer IV Investment Ltd. Asia Cement Explorer Investment Ltd. DCI	B.V.I. B.V.I. B.V.I. B.V.I. Cayman Taiwan Taiwan Taiwan Taiwan Cayman Taiwan Vietnam Indonesia Guam Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Cayman Taiwan Cayman Taiwan Indonesia India Guam Taiwan Taiwan Taiwan B.V.I. B.V.I. B.V.I. B.V.I. B.V.I. Taiwan	Investment Investment Investment Investment Investment Storage and transportation Granulated blast-furnace slag Textile Marine transportation Investment Ready-mixed concrete Ready-mixed concrete Ready-mixed concrete Investment Transportation Textile Retail Marine transportation Textile Investment Marine transportation Investment Retail Ready-mixed concrete Tunnel lining segments Investment Textile Marine transportation Power plant Investment Investment Investment Investment Investment Investment	$ 289,050 780,510 123,120 123,960 872,619 - 36,771 15,240 1,027 282,957 69,930 201,823 144,369 236,240 30,373 40,263 160,424 1,891 31,322 50,541 38,931 266,942 20,776 1,448 8,338 66,816 405,473 77,446 376 2,100,779 833,410 578,325 575,538 623,340 76	$ 289,050 780,510 123,120 - 872,619 333,309 36,771 15,240 1,027 282,957 69,930 201,823 61,439 175,230 30,373 40,263 160,424 1,891 31,322 50,541 38,931 266,942 20,776 621 8,338 66,816 405,473 77,446 376 2,039,879 544,135 289,050 286,263 334,065 76	10,000,000 26,100,000 4,000 4,000 56,297,000 - 3,287,550 1,739,978 64,143 9,250,000 6,993,000 (Note 1) (Note 1) (Note 1) 27,892,834 4,415,299 30,557,900 50,000 1,020,000 3,161,500 3,485,997 8,368,000 4,411,559 (Note 1) (Note 1) (Note 1) 15,430,293 7,796,914 37,574 68,550,000 28,000,000 19,500,000 19,010,000 20,915,000 5,401	100.00 100.00 25.00 25.00 1.29 - 31.00 0.03 0.01 0.21 69.93 100.00 99.00 95.04 99.87 0.08 26.95 0.01 0.02 0.20 0.41 0.19 3.89 1.00 99.99 4.96 0.29 0.92 0.01 100.00 100.00 100.00 100.00 100.00 -	$ 319,223 888,698 120,649 118,975 890,053 - 51,455 40,356 941 145,992 87,687 291,247 68,599 65,207 740,647 109,949 585,374 1,805 31,091 84,246 35,455 132,075 84,414 693 1,915 3,403 649,483 72,456 850 2,064,326 891,935 542,204 588,459 442,420 76	$ 52,787 106,605 3,831 (3,076) 13,578,105 - 8,847 10,732,669 1,621,695 13,578,105 27,530 7,838 (72,481) (43,552) 109,850 10,732,669 117,812 1,621,695 10,732,669 14,106,889 1,621,695 13,578,105 117,812 (72,481) (219) (43,552) 10,732,669 1,621,695 1,097,061 306,888 101,257 36,662 48,009 14,774 1,262,905	Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable	A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation

(Continued)

113 -

Investor Company	Investee Company	Location	Main Businesses and Products	Investment Amount	Investment Amount	Balance	as of December 31, 2019	as of December 31, 2019	Net Income (Loss) of the Investee	Share of Profits (Loss)	Note
				December 31, 2019	December 31, 2018	Shares	Percentage of Ownership	Carrying Value
YLT ACE ACP ACP II ACP III ACP IV Leap Mega Mega II Mega III Mega IV KCC JFTL AOG	FMT NHC AEE FSMS FDT YSRMC EISF YTRMC CSCGL U-Ming CSCGL Opas Fund Segregated Portfolio Company Drive Catalyst SPC CSCGL CSCGL CSCGL CSCGL CSCGL CSCGL CSCGL CSCGL CSCGL KCCL Join Fortune Trading Ltd. Empire Success Corp Ltd. Profit Enterprises Int'l Ltd. Asia Oriental Concrete, LLC Perez-Mtec-ACC, L.L.C.	Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Cayman Taiwan Cayman Cayman Cayman Cayman Cayman Cayman Cayman Cayman Cayman Cayman Cayman Cayman Hong Kong B.V.I. Hong Kong Hong Kong Guam Guam	Transportation Cement, granulated blast-furnace slag Engineering Mining excavation, mineral processing and sales Transportation Ready-mixed concrete Iron and steel Ready-mixed concrete, cement - related products Investment Marine transportation Investment Investment Investment Investment Investment Investment Investment Investment Investment Investment Investment Investment Ready-mixed concrete Investment Storage and transportation Barge transportation Ready-mixed concrete Ready-mixed concrete	$ 176 78 116 119 110 37 15,649 53 556,895 58,840 266,882 1,531 494 1,959,250 544,689 290,967 292,032 567,556 554,533 293,393 292,743 504,078 38 88,372 65,076 23,296 237,944 8,979	$ 176 78 116 119 110 37 15,649 53 556,895 58,840 266,882 1,531 494 1,959,250 544,689 290,967 292,032 567,556 554,533 293,393 292,743 504,078 38 88,372 65,076 23,296 178,084 8,979	5,000 5,000 6,000 5,000 7,145 5,000 660,000 5,782 31,528,000 6,348,103 7,480,000 33 33 107,536,000 36,865,000 14,790,000 18,514,000 35,569,000 30,251,000 16,058,000 18,477,000 37,410,000 10,000 2,979,721 17,040,000 6,100,000 (Note 1) (Note 1)	0.02 0.02 0.07 0.38 0.03 0.05 8.33 - 0.72 0.75 0.17 33.00 33.00 2.47 0.85 0.34 0.43 0.82 0.70 0.37 0.42 0.86 100.00 100.00 50.00 50.00 71.70 33.33	$ 272 80 120 125 199 44 16,630 53 498,144 308,774 118,080 1,607 488 1,700,893 583,507 233,970 293,443 562,979 479,139 254,137 291,688 591,806 138,589 18,957 16,508 3,289 22,269 42	$ 213,189 52,531 59,946 (6,936) 109,850 27,530 14,020 146,801 13,578,105 1,621,695 13,578,105 113 20 13,578,105 13,578,105 13,578,105 13,578,105 13,578,105 13,578,105 13,578,105 13,578,105 13,578,105 13,198 584 (559) 1,253 (66,247) -	Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable	A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation

(Continued)

114 -

Investor Company	Investee Company	Location	Main Businesses and Products	Investment Amount	Investment Amount	Balance	as of December 31, 2019	as of December 31, 2019	Net Income (Loss) of the Investee	Share of Profits (Loss)	Note
				December 31, 2019	December 31, 2018	Shares	Percentage of Ownership	Carrying Value
ACSPL ACCHC	OCPL ACCHC Alliance Concrete Singapore Pte. Ltd. PIHPL	Singapore Cayman Singapore B.V.I.	Ready-mixed concrete, leasing Investment Ready-mixed concrete Investment	$ 377,230 598,600 155,330 26,356,747	$ 377,230 598,600 155,330 26,356,747	17,000,000 63,790,798 6,000,000 9,379,303	100.00 4.07 50.00 100.00	$ 260,244 2,488,498 206,833 74,365,545	$ 3,400 14,106,889 204,204 15,638,825	Not applicable Not applicable Not applicable Not applicable	A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation

Note 1: This is not a company limited by shares.

(Concluded)

115 -

TABLE 8

ASIA CEMENT CORPORATION AND SUBSIDIARIES

INVESTMENT IN MAINLAND CHINA YEAR ENDED DECEMBER 31, 2019 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Investee Company	Main Businesses and Products	Paid-in Capital	Method of Investment (Note 2)	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2019	Remittance of Funds	Remittance of Funds	Accumulated Outward Remittance for Investment from Taiwan as of December 31, 2019	Net Income (Loss) of the Investee	% Ownership of Direct or Indirect Investment	Investment Gain (Loss) (Note 1)	Carrying Amount as of December 31, 2019	Accumulated Repatriation of Investment Income as of December 31, 2019
					Outward	Inward
SHYLCP JYDC WYDC SHYFCP OHC NYLC NYDC SIYDCCL CYCPCL JYLTC	It manufactures and sells ready-mixed concrete and cement - related products It manufactures and sells cement, clinker and ready-mixed concrete (including cement - related products). It manufactures and sells cement, slag powder and slag cement. It manufactures and sells ready-mixed concrete and cement - related products Investment It manufactures and sells ready-mixed concrete and cement - related products It manufactures and sells cement, slag powder and slag cement. Cement, clinker, slag powder and ready-mixed concrete (including cement - related products) It manufactures and sells ready-mixed concrete and cement - related products Transportation	US$15,000 (equivalent to NT$448,950 thousand) US$356,104 (equivalent to NT$10,658,193 thousand) US$36,140 (equivalent to NT$1,081,670 thousand) - US$130,407 (equivalent to NT$3,903,082 thousand) RMB60,000 (equivalent to NT$257,419 thousand) RMB90,000 (equivalent to NT$386,128 thousand) US$368,340 (equivalent to NT$11,024,416 thousand) US$4,100 (equivalent to NT$122,713 thousand) RMB12,500 (equivalent to NT$53,629 thousand)	(2) (2) (2) - (2) (2) (2) (2) (2) (2)	US$11,200 (equivalent to NT$335,216 thousand) US$93,035 (equivalent to NT$2,784,538 thousand) RMB(126,758) (equivalent to NT$(543,832) thousand) US$22,081 (equivalent to NT$660,884 thousand) RMB(3,533) (equivalent to NT$(15,158) thousand) US$1,270 (equivalent to NT$38,011 thousand) US$54,191 (equivalent to NT$1,621,937 thousand) - - US$67,585 (equivalent to NT$2,022,819 thousand) RMB(4,091) (equivalent to NT$(17,552) thousand) US$2,023 (equivalent to NT$60,548 thousand) -	$ - - - - - - - - - -	$ - RMB(380,367) (equivalent to NT$(1,631,895) thousand) - - - - - RMB(136,094) (equivalent to NT$(583,886) thousand) - -	US$11,200 (equivalent to NT$335,216 thousand) US$93,035 (equivalent to NT$2,784,538 thousand) RMB(507,125) (equivalent to NT$(2,175,727) thousand) US$22,081 (equivalent to NT$660,884 thousand) RMB(3,533) (equivalent to NT$(15,158) thousand) US$1,270 (equivalent to NT$38,011 thousand) US$54,191 (equivalent to NT$1,621,937 thousand) - - US$67,585 (equivalent to NT$2,022,819 thousand) RMB(140,185) (equivalent to NT$(601,438) thousand) US$2,023 (equivalent to NT$60,548 thousand) -	RMB14,271 (equivalent to NT$63,986 thousand) RMB1,488,812 (equivalent to NT$6,675,264 thousand) RMB29,023 (equivalent to NT$130,126 thousand) - RMB386,044 (equivalent to NT$1,730,872 thousand) RMB(6,553) (equivalent to NT$(29,379) thousand) RMB15,586 (equivalent to NT$69,883 thousand) RMB1,264,886 (equivalent to NT$5,671,266 thousand) RMB14,136 (equivalent to NT$63,381 thousand) RMB6,397 (equivalent to NT$28,680 thousand)	72.00 68.40 72.00 - 72.00 68.40 52.20 72.00 72.00 70.12	RMB10,275 (equivalent to NT$46,070 thousand) RMB1,018,348 (equivalent to NT$4,565,881 thousand) RMB20,896 (equivalent to NT$93,691 thousand) - RMB277,951 (equivalent to NT$1,246,228 thousand) RMB(4,482) (equivalent to NT$(20,096) thousand) RMB8,136 (equivalent to NT$36,479 thousand) RMB910,718 (equivalent to NT$4,083,312 thousand) RMB10,178 (equivalent to NT$45,634 thousand) RMB4,485 (equivalent to NT$20,111 thousand)	RMB10,405 (equivalent to NT$44,643 thousand) RMB4,112,215 (equivalent to NT$17,642,702 thousand) RMB438,541 (equivalent to NT$1,881,481 thousand) - RMB2,077,855 (equivalent to NT$8,914,653 thousand) RMB112,989 (equivalent to NT$484,760 thousand) RMB88,543 (equivalent to NT$379,876 thousand) RMB3,773,937 (equivalent to NT$16,191,384 thousand) RMB59,238 (equivalent to NT$254,151 thousand) RMB25,780 (equivalent to NT$110,602 thousand)	US$800 (equivalent to NT$23,944 thousand) US$50,781 (equivalent to NT$1,519,875 thousand) RMB507,125 (equivalent to NT$2,175,727 thousand) US$4,469 (equivalent to NT$133,757 thousand) RMB3,533 (equivalent to NT$15,158 thousand) - US$809 (equivalent to NT$24,213 thousand) - - US$27,009 (equivalent to NT$808,379 thousand) RMB140,185 (equivalent to NT$601,438 thousand) US$77 (equivalent to NT$2,305 thousand) -
												(Continued)

116 -

Investee Company	Main Businesses and Products	Paid-in Capital	Method of Investment (Note 2)	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2019	Remittance of Funds	Remittance of Funds	Accumulated Outward Remittance for Investment from Taiwan as of December 31, 2019	Net Income (Loss) of the Investee	% Ownership of Direct or Indirect Investment	Investment Gain (Loss) (Note 1)	Carrying Amount as of December 31, 2019	Accumulated Repatriation of Investment Income as of December 31, 2019
					Outward	Inward
HYDCCL CYSPC SYCPCL SYTCL YYDCCL HGYDC HYTCL WYCPCL WYXC HZYCCL HXMC WAMTC TZOCCL	Cement, clinker, slag powder and ready-mixed concrete (including cement - related products) Slag powder It manufactures and sells ready-mixed concrete and cement - related products Transportation Cement, slag powder and ready-mixed concrete (including cement - related products) Cement, clinker, slag powder and ready-mixed concrete (including cement - related products) Transportation It manufactures and sells ready-mixed concrete and cement - related products Cement, clinker, slag powder and ready-mixed concrete (including cement - related products) It manufactures and sells ready-mixed concrete and cement - related products Production and sales of limestone Marine transportation Cement - related products	US$154,800 (equivalent to NT$4,633,164 thousand) - US$3,300 (equivalent to NT$98,769 thousand) US$3,500 (equivalent to NT$104,755 thousand) US$35,530 (equivalent to NT$1,063,413 thousand) US$86,170 (equivalent to NT$2,579,068 thousand) RMB13,000 (equivalent to NT$55,774 thousand) RMB60,000 (equivalent to NT$257,419 thousand) RMB90,000 (equivalent to NT$386,128 thousand) RMB30,000 (equivalent to NT$128,709 thousand) RMB10,000 (equivalent to NT$42,903 thousand) RMB35,500 (equivalent to NT$152,306 thousand) US$16,000 (equivalent to NT$478,880 thousand)	(2) - (2) (2) (2) (2) (2) (2) (2) (2) (2) (2) (2)	US$44,610 (equivalent to NT$1,335,177 thousand) RMB(36,155) (equivalent to NT$(155,116) thousand) US$980 (equivalent to NT$29,331 thousand) US$2,970 (equivalent to NT$88,892 thousand) US$2,158 (equivalent to NT$64,589 thousand) US$14,833 (equivalent to NT$443,952 thousand) US$13,513 (equivalent to NT$404,444 thousand) RMB(24,078) (equivalent to NT$(103,302) thousand) - - - - - - -	$ - - - - - - - - - - - - -	RMB(87,753) (equivalent to NT$(376,488) thousand) - - - - RMB(67,959) (equivalent to NT$(291,566) thousand) - - - - - - -	US$44,610 (equivalent to NT$1,335,177 thousand) RMB(123,908) (equivalent to NT$(531,604) thousand) US$980 (equivalent to NT$29,331 thousand) US$2,970 (equivalent to NT$88,892 thousand) US$2,158 (equivalent to NT$64,589 thousand) US$14,833 (equivalent to NT$443,952 thousand) US$13,513 (equivalent to NT$404,444 thousand) RMB(92,037) (equivalent to NT$(394,868) thousand) - - - - - - -	RMB430,511 (equivalent to NT$1,930,247 thousand) - RMB17,747 (equivalent to NT$79,571 thousand) RMB4,087 (equivalent to NT$18,323 thousand) RMB50,419 (equivalent to NT$226,061 thousand) RMB265,762 (equivalent to NT$1,191,577 thousand) RMB112 (equivalent to NT$501 thousand) RMB23,129 (equivalent to NT$103,702 thousand) RMB45,088 (equivalent to NT$202,157 thousand) RMB6,787 (equivalent to NT$30,430 thousand) RMB10,800 (equivalent to NT$48,425 thousand) RMB10,804 (equivalent to NT$48,439 thousand) RMB13,131 (equivalent to NT$58,875 thousand)	72.00 - 72.00 72.00 72.00 72.00 72.00 72.00 64.79 28.80 28.80 34.20 72.00	RMB309,968 (equivalent to NT$1,389,778 thousand) - RMB12,778 (equivalent to NT$57,291 thousand) RMB2,942 (equivalent to NT$13,193 thousand) RMB36,302 (equivalent to NT$162,764 thousand) RMB191,349 (equivalent to NT$857,936 thousand) RMB80 (equivalent to NT$360 thousand) RMB16,653 (equivalent to NT$74,665 thousand) RMB28,758 (equivalent to NT$128,941 thousand) RMB1,955 (equivalent to NT$8,764 thousand) RMB2,948 (equivalent to NT$13,217 thousand) RMB3,751 (equivalent to NT$16,820 thousand) RMB8,982 (equivalent to NT$40,271 thousand)	RMB1,884,938 (equivalent to NT$8,086,981 thousand) - RMB38,641 (equivalent to NT$165,782 thousand) RMB31,255 (equivalent to NT$134,095 thousand) RMB300,302 (equivalent to NT$1,288,390 thousand) RMB915,154 (equivalent to NT$3,926,300 thousand) RMB13,316 (equivalent to NT$57,130 thousand) RMB65,039 (equivalent to NT$279,036 thousand) RMB256,172 (equivalent to NT$1,099,058 thousand) RMB13,305 (equivalent to NT$57,084 thousand) RMB6,819 (equivalent to NT$29,255 thousand) RMB32,162 (equivalent to NT$137,985 thousand) RMB60,949 (equivalent to NT$261,493 thousand)	US$12,990 (equivalent to NT$388,791 thousand) RMB123,908 (equivalent to NT$531,604 thousand) - - US$992 (equivalent to NT$29,691 thousand) US$1,016 (equivalent to NT$30,409 thousand) US$1,837 (equivalent to NT$54,981 thousand) RMB92,037 (equivalent to NT$394,868 thousand) - - - - - - -
												(Continued)

117 -

Investee Company	Main Businesses and Products	Main Businesses and Products	Paid-in Capital	Method of Investment (Note 2)	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2019	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2019	Remittance of Funds	Remittance of Funds	Accumulated Outward Remittance for Investment from Taiwan as of December 31, 2019	Net Income (Loss) of the Investee	% Ownership of Direct or Indirect Investment	Investment Gain (Loss) (Note 1)	Carrying Amount as of December 31, 2019	Accumulated Repatriation of Investment Income as of December 31, 2019
							Outward	Inward
SLCL SLCCL YDES RYNM	Cement, clinker, slag powder and ready-mixed concrete (including cement - related products) Cement - related products Wholesale of chemical products and machinery equipment, design and development of computer software and network technology Building materials, products and construction waste		RMB600,000 (equivalent to NT$2,574,190 thousand) RMB20,000 (equivalent to NT$85,806 thousand) RMB1,763,425 (equivalent to NT$7,565,650 thousand) RMB2,000 (equivalent to NT$8,581 thousand)	(2) (2) (2) (2)	$	- - - -	$ - - - -	$ - - - -	$ - - - -	RMB568,864 (equivalent to NT$2,550,570 thousand) RMB(503) (equivalent to NT$((2,254) thousand) RMB(22,262) (equivalent to NT$(99,813) thousand) RMB47,672 (equivalent to NT$213,741 thousand)	72.00 72.00 28.80 68.40	RMB407,522 (equivalent to NT$1,827,173 thousand) RMB(362) (equivalent to NT$(1,623) thousand) RMB(5,434) (equivalent to NT$(24,364) thousand) RMB32,607 (equivalent to NT$146,199 thousand)	RMB1,512,948 (equivalent to NT$6,491,023 thousand) RMB(15,014) (equivalent to NT$(64,413) thousand) RMB508,783 (equivalent to NT$2,182,839 thousand) RMB33,975 (equivalent to NT$145,765 thousand)	$ - - - -

Accumulated Outward Remittance for Investment in Mainland China as of December 31, 2019		Investment Amounts Authorized by Investment Commission, MOEA				Upper Limit on the Amount of Investment Stipulated by Investment Commission, MOEA
US$481,069 (Note 3) (equivalent to NT$14,398,395 thousand) RMB(866,788) (equivalent to NT$(3,718,794) thousand)		US$2,284,279 (equivalent to NT$68,368,470 thousand)				(Note 4)

Note 1: The accrual is based on the financial statements audited by independent auditors.

Note 2: The investor companies were incorporated in Mainland China by a company (2) (ACCHC) which was incorporated in the area other than Taiwan and Mainland China in order to invest in Mainland China.

Note 3: As of December 31, 2019 accumulated investment in China Shanshui Cement Group Ltd which listed at HKEx for managing finance purpose was US$150,620 thousand included in Accumulated Outward Remittance for Investment in Mainland China.

Note 4: The Corporation obtained certificate No. 10620435220 from Industrial Development Bureau, Ministry of Economic Affairs, according to the “Regulations Governing the Approval of Investment or Technical Cooperation in Mainland China”, the accumulation of fund is not limited.

Note 5: The foreign currency amounts of original investment amount and carrying value are expressed in New Taiwan dollars at exchange rate as of December 31, 2019 the foreign currency amount of net income is expressed in New Taiwan dollars at average exchange rate for the year ended December 31, 2019.

(Concluded)

118 -

TABLE 9

ASIA CEMENT CORPORATION AND SUBSIDIARIES

BUSINESS RELATIONSHIP AND SIGNIFICANT INTERCOMPANY TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 2019 (In Thousands of New Taiwan Dollars)

Number	Company Name	Counterparty	Relationship (Note)	Transaction Details	Transaction Details		% to Total Revenue or Assets
				Financial Statement Account	Amount	Transaction Terms
0	The Corporation	YTRMC ACSPL AIC YSRMC DCI	1 1 1 1 1 1 1 1 1 1	Accounts receivable Sales Other revenue Guarantee deposits Accounts receivable Sales Other revenue Accounts receivable Sales Other revenue	$ 348,664 1,805,262 12,423 576,643 38,621 522,223 27,598 34,114 163,476 18,189	Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- 2 - - - - - - - -
1	YTRMC	YTV	1	Other receivables	33,288	Based on regular terms	-
2	AEE	The Corporation YLT NHC	2 2 3 3	Accounts receivable Sales Sales Sales	11,087 10,866 30,297 13,552	Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - -
3	NHC	The Corporation	2 2	Accounts receivable Sales	28,431 151,293	Based on regular terms Based on regular terms	- -
4	YLT	The Corporation	2 2	Accounts receivable Sales	31,883 176,539	Based on regular terms Based on regular terms	- -
5	FMT	The Corporation YTRMC NHC FDT	2 2 3 3 3 1 1	Accounts receivable Sales Accounts receivable Sales Sales Sales Other revenue	14,930 86,230 10,483 49,011 13,766 66,082 18,786	Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - - - - -
6	FDT	FMT YLSS	2 2 3	Other receivables Sales Sales	10,027 67,601 19,486	Based on regular terms Based on regular terms Based on regular terms	- - -
7	OC	ACCHC	2	Other receivables	193,187	Based on regular terms	-
							(Continued)

119 -

Number	Company Name	Counterparty	Relationship (Note)	Transaction Details	Transaction Details		% to Total Revenue or Assets
				Financial Statement Account	Amount	Transaction Terms
8	SHYLCP	JYDC	3	Sales	$ 40,950	Based on regular terms	-
9	OHC	SLCL	3 3	Other receivables Interest revenue	816,179 41,576	Based on regular terms Based on regular terms	- -
10	SYTCL	SYCPCL SIYDCCL SLCL	3 3 3 3 3	Sales Accounts receivable Sales Accounts receivable Sales	20,344 11,646 83,829 26,438 194,697	Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - - -
11	SIYDCCL	SYCPCL SLCL CYCPCL	3 3 1 1 3 3	Accounts receivable Sales Accounts receivable Sales Accounts receivable Sales	37,367 123,821 31,346 363,433 16,925 95,363	Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - - - -
12	SLCL	SYCPCL SIYDCCL SLCCL	3 3 2 2 1	Accounts receivable Sales Sales Other receivables Other receivables	96,972 104,895 29,403 171,827 141,757	Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - - -
13	CYCPCL	SYCPCL SIYDCCL SLCL	3 3 3 3	Accounts receivable Sales Sales Sales	50,241 62,680 12,150 21,489	Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - -
14	JYLTC	JYDC NYDC HGYDC	2 2 3 3 3	Accounts receivable Sales Accounts receivable Sales Sales	62,673 233,332 30,867 85,317 32,807	Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - - -
15	JYDC	The Corporation SHYLCP SIYDCCL SLCL ACCHC WYDC NYLC	2 3 3 3 3 2 2 3 3 1 1	Sales Other receivables Other receivables Other revenue Other revenue Other receivables Interest revenue Accounts receivable Sales Accounts receivable Sales	67,211 193,553 13,482 23,793 11,308 3,014,013 11,278 162,610 952,682 27,901 149,911	Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - - - 1 - - 1 - -
							(Continued)

120 -

Number	Company Name	Counterparty	Relationship (Note)	Transaction Details	Transaction Details		% to Total Revenue or Assets
				Financial Statement Account	Amount	Transaction Terms
		NYDC TZOCCL YYDCCL HYDCCL RYNM	1 1 3 3 3 3 3 3 3 3 3	Accounts receivable Sales Accounts receivable Other receivables Sales Interest revenue Accounts receivable Sales Accounts receivable Sales Sales	$ 69,869 413,400 149,616 301,665 1,078,874 15,618 136,281 2,476,837 52,787 222,443 104,764	Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - - 1 - - 3 - - -
16	WYCPCL	HYDCCL	3	Sales	28,540	Based on regular terms	-
17	WYDC	SLCL SYCPCL	3 3	Interest revenue Other receivables	12,408 171,827	Based on regular terms Based on regular terms	- -
18	WYXC	WYDC	3 3	Accounts receivable Sales	28,367 39,374	Based on regular terms Based on regular terms	- -
19	NYLC	JYDC	2 2	Accounts receivable Sales	10,616 129,021	Based on regular terms Based on regular terms	- -
20	NYDC	JYDC	2 2	Accounts receivable Sales	196,087 1,319,721	Based on regular terms Based on regular terms	- 1
21	YYDCCL	TZOCCL	3	Sales	133,883	Based on regular terms	-
22	HYTCL	WYDC HYDCCL	3 2 2	Sales Accounts receivable Sales	14,271 10,066 53,369	Based on regular terms Based on regular terms Based on regular terms	- - -
23	HYDCCL	SIYDCCL SLCL JYDC ACCHC WYCPCL WYDC WYXC HGYDC	3 3 3 3 3 3 2 2 3 3 3 3 1 3	Accounts receivable Sales Accounts receivable Sales Interest revenue Sales Other receivables Interest revenue Accounts receivable Sales Sales Other revenue Sales Sales	10,992 61,346 10,430 64,074 11,324 86,603 1,732,944 16,581 60,428 200,144 115,249 10,371 20,284 12,487	Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - - - - - - - - - - - -
							(Continued)

121 -

Number	Company Name	Counterparty	Relationship (Note)	Transaction Details	Transaction Details		% to Total Revenue or Assets
				Financial Statement Account	Amount	Transaction Terms
24	HGYDC	JYDC WYCPCL WYXC HYDCCL YYDCCL	3 3 3 3 3 3 3	Accounts receivable Sales Sales Sales Accounts receivable Sales Sales	$ 31,619 111,553 21,367 17,064 41,434 388,690 42,056	Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - - - - -
25	RYNM	JYDC YYDCCL HYDCCL	2 3 3 3 3	Prepayment for purchases Accounts receivable Sales Accounts receivable Sales	73,317 10,092 23,773 21,613 22,584	Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - - -
26	AOG	AOC	1 1	Long-term lease receivable Accounts receivable	10,118 23,835	Based on regular terms Based on regular terms	- -

Note: 1. Parent to subsidiary.
Subsidiary to parent.
Between subsidiaries.

(Concluded)

122 -

Asia Cement Corporation

Financial Statements for the Years Ended December 31, 2019 and 2018 and Independent Auditors’ Report

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders Asia Cement Corporation

Opinion

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Corporation in accordance with The Norm of Professional Ethics for Certified Public Accountant of the Republic of China, 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

The key audit matters identified in the Corporation’s financial statements for the year ended December 31, 2019 are stated as follows:

Estimated Impairment of Trade Receivables of Subsidiaries

The estimated provision for impairment of trade receivables is based on the assumptions of defaults and expected loss rates. The assumptions and selection of inputs for impairment calculation are based on the historical experience, existing market conditions as well as forward looking estimates of the Corporation’s subsidiaries. When the actual future cash flows are less than expected, a material impairment loss may arise. Because key assumptions and inputs used for measuring expected credit losses on trade receivables involve significant judgments and uncertainties, we considered the estimated impairment of trade receivables as one of the key audit matters.

The corresponding audit procedures that we performed for the estimated impairment of trade receivables of the subsidiaries are as follows:

We obtained an understanding of the internal control procedures with respect to management’s allowance for impairment loss of trade receivables.
We evaluated the reasonableness of allowance for impairment loss by testing the aging of trade receivables and by quantifying the potential risk of trade receivables that were overdue at the balance sheet date.
We tested the recoverability of the trade receivables by vouching cash receipts after the balance sheet date.
For the estimated impairment of accounts receivable, we evaluated the adequacy of management’s provision for impairment based on customers’ past default experience, current financial position, any collateral pledged, existing market conditions as well as forward looking estimates.

Fair Value Measurement of Investment Properties

The corresponding audit procedures that we performed for the fair value measurement of investment properties are as follows:

We assessed the professional competence and independence of the appraiser engaged by management and we obtained an understanding of the appraiser’s scope of work and process of engagement to confirm that no circumstances affect the appraiser’s independence and limit the scope of his work.
We obtained an understanding of and assessed the reasonableness of management’s assumptions and methods used in the valuation.
We sample-tested items from management’s supporting documents, which include the effective gross income, expenses, and property rights of land and buildings to verify the valuation process used by management and recalculated the fair value of investment properties to assess the reasonableness of management’s calculation.

Other Matter

The financial statements of China Shanshui Cement Group Limited (CSCGL), an associate accounted for using equity method, were audited by other auditors as of December 31, 2019 and 2018. Our opinion, insofar as it relates to the amounts included in the accompanying financial statements for CSCGL, is based solely on the reports of other auditors. As of December 31, 2019 and 2018, the aggregate carrying value of the equity-method investments in CSCGL was NT$12,022,105 thousand and NT$10,215,045 thousand, respectively, representing 6% and 5%, respectively, of the total assets. For the years ended December 31, 2019 and 2018, the share of profit or loss of CSCGL was NT$2,211,060 thousand and NT$376,472 thousand, respectively, representing 12% and 3%, respectively, of the profit before income tax

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

Those charged with governance, including the audit committee, are responsible for overseeing the Corporation’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Financial Statements

Identify and assess the risks of material misstatement of the 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, but not for the purpose of expressing an opinion on the effectiveness of the Corporation’s internal control.
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 Corporation’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the 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 Corporation to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of entities or business activities within the Corporation to express an opinion on the financial statements. We are responsible for the direction, supervision, and performance of the company audit. We remain solely responsible for our audit opinion.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements for the year ended December 31, 2019 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 partners on the audit resulting in this independent auditors’ report are Tai, Xin Wei and Fan, Yu Wei.

Deloitte & Touche Taipei, Taiwan Republic of China

March 25, 2020

Notice to Readers

ASIA CEMENT CORPORATION

BALANCE SHEETS DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 6 and 30) Financial assets at fair value through profit or loss - current (Note 7) Financial assets at fair value through other comprehensive income - current (Notes 8 and 31) Financial assets at amortized cost (Notes 6, 11 and 30) Notes receivable Third parties Trade receivables Third parties (Note 10) Related parties (Notes 10 and 30) Other receivables (Note 30) Current tax assets (Note 26) Inventories (Note 11) Prepayments (Note 17) Other current assets Total current assets NON-CURRENT ASSETS Investments accounted for using equity method (Notes 12 and 31) Financial assets at fair value through other comprehensive income - non-current (Note 8) Property, plant and equipment (Notes 13 and 31) Right-of-use assets (Note 14) Investment properties (Notes 15, 30 and 31) Intangible assets (Note 16) Deferred tax assets (Note 26) Long-term prepayments for leases (Note 17) Other non-current assets (Notes 18, 22 and 30) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term bills payable (Note 19) Financial liabilities at fair value through profit or loss - current (Note 7) Contract liabilities - current (Note 24) Accounts payable and accrued expenses Third parties Related parties (Note 30) Dividends and bonuses payable Current tax liabilities (Note 26) Lease liabilities - current (Note 14) Deferred revenue - current (Note 21) Current portion of long-term liabilities (Note 20) Total current liabilities NON-CURRENT LIABILITIES Bonds payable (Note 20) Long-term borrowings (Note 20) Provisions - non-current (Note 23) Deferred tax liabilities (Note 26) Lease liabilities - non-current (Note 14) Deferred revenue - non-current (Note 21) Other non-current liabilities Total non-current liabilities Total liabilities EQUITY (Notes 23) Ordinary shares Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Total retained earnings Other equity Total equity TOTAL		2019 Amount % $ 2,475,739 1 1,690,528 1 2,237,578 1 1,763,189 1 80,634 - 513,070 - 447,234 - 75,865 - - - 1,545,309 1 45,581 - 6,234 - 10,880,961 5 135,143,849 67 6,588,692 3 4,234,288 2 441,661 - 42,114,210 21 4,957 - 16,463 - - - 4,515,418 2 193,059,538 95 $ 203,940,499 100 $ 10,757,906 5 112,070 - 83,726 - 1,478,744 1 201,804 - 224,335 - 298,368 - 40,370 - 75,912 - 3,000,000 2 16,273,235 8 19,280,807 9 11,795,000 6 98,000 - 9,503,629 5 44,787 - 847,893 - 29,790 - 41,599,906 20 57,873,141 28 33,614,472 17 1,456,054 1 16,727,089 8 64,463,426 32 27,373,840 13 108,564,355 53 2,432,477 1 146,067,358 72 $ 203,940,499 100		2018
				Amount % $ 3,165,795 2 1,172,826 1 2,371,026 1 462,275 - 95,212 - 474,070 - 520,982 - 29,495 - 9,022 - 1,663,395 1 188,456 - 12,125 - 10,164,679 5 125,632,890 65 5,386,142 3 4,374,050 2 - - 41,689,694 22 8,344 - 12,603 - 369,801 - 5,192,895 3 182,666,419 95 $ 192,831,098 100 $ 11,437,104 6 268,218 - 40,661 - 1,415,215 1 188,104 - 214,593 - 8,477 - - - 75,912 - 4,000,000 2 17,648,284 9 12,192,567 6 15,025,011 8 98,000 - 9,020,630 5 - - 923,805 - 30,575 - 37,290,588 19 54,938,872 28 33,614,472 17 1,362,554 1 15,615,380 8 63,945,145 33 20,358,461 11 99,918,986 52 2,996,214 2 137,892,226 72 $ 192,831,098 100

The accompanying notes are an integral part of the financial statements.

(With Deloitte & Touche auditors’ report dated March 25, 2020)

ASIA CEMENT CORPORATION

STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OPERATING REVENUE (Notes 24 and 30) OPERATING COSTS (Notes 11, 24, 25 and 30) GROSS PROFIT (UNREALIZED) REALIZED GAIN ON TRANSACTIONS WITH SUBSIDIARIES AND ASSOCIATES REALIZED GROSS PROFIT OPERATING EXPENSES Administrative expenses (Notes 25 and 30) Expected credit loss (Note 10) Total operating expenses OPERATING LOSS NON-OPERATING INCOME AND EXPENSES Other income (Note 25) Other gains and losses (Note 25) Finance costs (Note 25) Share of profit of subsidiaries and associates Total non-operating income and expenses PROFIT BEFORE INCOME TAX INCOME TAX EXPENSE (Note 26) NET INCOME FOR THE YEAR		2019 Amount % $ 8,985,917 100 8,507,992 95 477,925 5 (8,442) - 469,483 5 678,405 7 3,753 - 682,158 7 (212,675) (2) 812,795 9 814,110 9 (369,349) (4) 17,111,219 190 18,368,775 204 18,156,100 202 696,427 8 17,459,673 194		2018
				Amount % $ 8,732,236 100 8,479,146 97 253,090 3 3,444 - 256,534 3 649,813 8 694 - 650,507 8 (393,973) (5) 592,445 7 (641,800) (7) (331,984) (4) 12,970,044 148 12,588,705 144 12,194,732 139 1,077,638 12 11,117,094 127 (Continued)

ASIA CEMENT CORPORATION

STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OTHER COMPREHENSIVE INCOME, NET Items that will not be reclassified subsequently to profit or loss: Unrealized gain (loss) on investments in equity instruments at fair value through other comprehensive income Remeasurement of defined benefit plans Share of other comprehensive (loss) income of subsidiaries and associates Items that may be reclassified subsequently to profit or loss: Share of other comprehensive (loss) income of subsidiaries and associates Other comprehensive income for the year, net of income tax TOTAL COMPREHENSIVE INCOME FOR THE YEAR EARNINGS PER SHARE (Note 27) Basic Diluted		2019 Amount % $ 329,435 4 467,246 5 2,650,225 29 3,446,906 38 (3,254,043) (36) 192,863 2 $ 17,652,536 196 $ 5.56 $ 5.25		2018
				Amount % $ (9) - 265,965 3 1,426,545 17 1,692,501 20 1,758 - 1,694,259 20 $ 12,811,353 147 $ 3.54 $ 3.49

The accompanying notes are an integral part of the financial statements. (With Deloitte & Touche auditors’ report dated March 25, 2020) (Concluded)

ASIA CEMENT CORPORATION

STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

Share Capital Issued Shares Amount Capital Surplus 3,361,447 $ 33,614,472 $ 1,168,692 - - - - - - - - - - - 185,411 - - 8,451 - - - - - - - - - - - - 3,361,447 33,614,472 1,362,554 - - - 3,361,447 33,614,472 1,362,554 - - - - - - - - - - - 93,500 - - - - - - - - - - - - 3,361,447 $ 33,614,472 $ 1,456,054	Retained Earnings		Other Equity
		Exchange Differences on Translating the Unrealized Gain (Loss) on Financial Assets Financial at Fair Value Statements of Through Other Foreign Comprehensive Operations Income $ (2,638,153 ) $ 516,962 - - - - - - - - - - - - (3,211 ) 1,343,257 - 3,408,697 - - (2,641,364 ) 5,268,916 - - (2,641,364 ) 5,268,916 - - - - - - - - - - (3,271,837 ) 2,719,118 - (79,711 ) - - $ (5,913,201) $ 7,908,323	Gains on Property Revaluation $ 307,728 - - - - - - - - - 307,728 - 307,728 - - - - - 77,486 - - $ 385,214	Cash Flow Hedge $ 58,485 - - - - - - 2,449 - - 60,934 - 60,934 - - - - - (8,793 ) - - $ 52,141
	Legal Reserve Special Reserve $ 15,068,480 $ 63,001,957 546,900 - - 943,188 - - - - - - - - - - - - - - 15,615,380 63,945,145 - - 15,615,380 63,945,145 1,111,709 - - 518,281 - - - - - - - - - - - - $ 16,727,089 $ 64,463,426
Shares 3,361,447 - - - - - - - - - 3,361,447 - 3,361,447 - - - - - - - - 3,361,447

The accompanying notes are an integral part of the financial statements.

(With Deloitte & Touche auditors’ report dated March 25, 2020)

ASIA CEMENT CORPORATION

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments for: Share of profit of subsidiaries and associates Net gain on fair value changes of financial assets and liabilities designated as at fair value through profit or loss Depreciation expenses Dividend income (Gain) loss on changes in fair value of investment properties Finance costs Interest income Unrealized loss on foreign exchange Unrealized (realized) gain on transactions with subsidiaries and associates Expected credit loss recognized on trade receivables Amortization expenses Gain on disposal of property, plant and equipment Write-downs of inventories Effect of changes in exchange rate of bonds payable Changes in operating assets and liabilities: Notes receivable Trade receivables Other receivables Inventories Prepayments Other current assets Net defined benefit assets Contract liabilities Accounts payable and accrued expenses Provisions Deferred revenue Cash generated from (used in) operations Interest received Dividend received Interest paid Income tax paid Net cash generated from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Purchase of financial assets at amortized cost Increase (decrease) in refundable deposits Payments for property, plant and equipment Purchase of financial assets at fair value through other comprehensive income	2019 $ 18,156,100 (17,111,219) (673,850) 523,626 (422,860) (399,682) 369,349 (299,327) 143,442 8,442 3,753 3,589 (40) - - 14,578 27,930 (35,221) 67,546 107,544 5,891 (48,810) 43,065 57,642 - (75,912) 465,576 288,178 7,345,508 (257,528) (35,186) 7,806,548 (1,365,160) 679,526 (183,122) (123,395)	2018 $ 12,194,732 (12,970,044) (171,737) 464,781 (405,773) 331,211 331,984 (114,003) 44,425 (3,444) 694 3,297 (4,053) 52,791 300 7,091 (238,962) 1,322 (396,116) (52,997) (3,798) (37,657) (9,040) 189,552 48,000 (68,085) (805,529) 112,952 4,296,112 (336,387) (11,234) 3,255,914 - (33,377) (194,754) - (Continued)

ASIA CEMENT CORPORATION

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars)

Payments for investment properties Payments for intangible assets Proceeds from disposal of property, plant and equipment Proceeds from sale of financial assets at amortized cost Net cash (used in) generated from investing activities CASH FLOWS FROM FINANCING ACTIVITIES Repayments of long-term borrowings Proceeds from long-term borrowings Proceeds from issuance of bonds Dividends paid Repayments of bonds (Decrease) increase in short-term bills payable Repayment of the principal portion of lease liabilities Decrease in guarantee deposits received Net cash used in financing activities EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE OF CASH AND CASH EQUIVALENTS HELD IN FOREIGN CURRENCIES NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR	2019 $ (24,834) (202) 46 - (1,017,141) (61,746,000) 58,508,000 10,000,000 (9,412,164) (4,000,000) (680,000) (86,929) (785) (7,417,878) (61,585) (690,056) 3,165,795 $ 2,475,739	2018 $ (1,269) (2,693) 4,059 2,096,122 1,868,088 (18,588,000) 15,033,000 6,574,843 (4,033,715) (4,089,430) 2,310,000 - (1,010) (2,794,312) 20,179 2,349,869 815,926 $ 3,165,795

The accompanying notes are an integral part of the financial statements. (With Deloitte & Touche auditors’ report dated March 25, 2020) (Concluded)

10 -

NOTES TO FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

ASIA CEMENT CORPORATION

1. ORGANIZATION AND OPERATIONS

Asia Cement Corporation (the “Corporation”) was incorporated in March 1957. It manufactures and sells cement, clinker, cement-related products and ready-mixed concrete, and engages in leasing activities. The Corporation is also required to undertake reforestation activities in designated areas. The Corporation’s stock have been listed on the Taiwan Stock Exchange since June 1962.

The financial statements are presented in the Corporation’s functional currency, New Taiwan dollar.

2. APPROVAL OF FINANCIAL STATEMENTS

The financial statements were approved by the Corporation’s board of directors and authorized for issue on March 25, 2020.

3. APPLICATION OF NEW, AMENDED AND REVISED STANDARDS AND INTERPRETATIONS

a. Initial application of the amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) (collectively, the “IFRSs”) endorsed and issued into effect by the Financial Supervisory Commission (FSC)

IFRS 16 “Leases”

Definition of a lease

The Corporation elects to apply the guidance of IFRS 16 in determining whether contracts are, or contain, a lease only to contracts entered into (or changed) on or after January 1, 2019. Contracts identified as containing a lease under IAS 17 and IFRIC 4 are not reassessed and are accounted for in accordance with the transitional provisions under IFRS 16.

11 -

The Corporation as lessee

The Corporation recognizes right-of-use assets and lease liabilities for all leases on the balance sheets except for those whose payments under low-value asset and short-term leases are recognized as expenses on a straight-line basis. On the statements of comprehensive income, the Corporation presents the depreciation expense charged on right-of-use assets separately from the interest expense accrued on lease liabilities; interest is computed using the effective interest method. On the statements of cash flows, cash payments for the principal portion of lease liabilities are classified within financing activities; cash payments for the interest portion are classified within operating activities. Prior to the application of IFRS 16, payments under operating lease contracts were recognized as expenses on a straight-line basis. Cash flows for operating leases were classified within operating activities on the statements of cash flows.

The Corporation elects to apply IFRS 16 retrospectively with the cumulative effect of the initial application of this standard recognized in retained earnings on January 1, 2019. Comparative information is not restated.

The Corporation also applies the following practical expedients:

1) The Corporation applies a single discount rate to a portfolio of leases with reasonably similar characteristics to measure lease liabilities.
2) The Corporation accounts for those leases for which the lease term ends on or before December 31, 2019 as short-term leases.
3) The Corporation uses hindsight, such as in determining lease terms, to measure lease liabilities.

The lessee’s weighted average incremental borrowing rate applied to lease liabilities recognized on January 1, 2019 is 1.3%. The difference between the lease liabilities recognized and operating lease commitments disclosed under IAS 17 on December 31, 2018 is explained as follows:

The future minimum lease payments of non-cancellable operating lease commitments on December 31, 2018 Less: Recognition exemption for short-term leases and low-value asset leases Undiscounted amounts on January 1, 2019 Lease liabilities recognized on January 1, 2019 The Corporation as lessor	$ 270,318 (89,632) $ 180,686 $ 176,204

The Corporation does not make any adjustments for leases in which it is a lessor, and it accounts for those leases with the application of IFRS 16 starting from January 1, 2019.

12 -

The impact on assets, liabilities and equity as of January 1, 2019 from the initial application of IFRS 16 is set out as follows:

As Originally
Stated on
January 1, 2019
Prepayments for leases - current
$ 188,456
Prepayments for leases - non-current

369,801
Right-of-use assets

-
Investments accounted for using equity
method
125,632,890

Total effect on assets
$ 126,191,147

Lease liabilities - current
$ -
Lease liabilities - non-current

-

Total effect on liabilities
$ -

Retained earnings
$ 99,918,986

Total effect on equity
$ 99,918,986

Adjustments
Arising from
Initial
Application
Restated on
January 1, 2019
$ (7,763) $ 180,693
(369,801)
-
553,768
553,768

(143,100)
125,489,790
$ 33,104
$ 126,224,251
$ 81,737 $ 81,737

94,467

94,467
$ 176,204
$ 176,204
$ (143,100)
$ 99,775,886
$ (143,100)
$ 99,775,886

b. The IFRSs endorsed by the FSC for application starting from 2020

New IFRSs Amendments to IFRS 3 “Definition of a Business” Amendments to IFRS 9, IAS 39 and IFRS 7 “Interest Rate Benchmark Reform” Amendments to IAS 1 and IAS 8 “Definition of Material”	Effective Date Announced by IASB
	January 1, 2020 (Note 1) January 1, 2020 (Note 2) January 1, 2020 (Note 3)

Note 1: The Corporation shall apply these amendments to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after January 1, 2020 and to asset acquisitions that occur on or after the beginning of that period.
Note 2: The Corporation shall apply these amendments retrospectively for annual reporting periods beginning on or after January 1, 2020.
Note 3: The Corporation shall apply these amendments prospectively for annual reporting periods beginning on or after January 1, 2020.

As of the date the financial statements were authorized for issue, the Corporation is continuously assessing the possible impact that the application of the above standards and interpretations will have on the Corporation’s financial position and financial performance, and will disclose the relevant impact when the assessment is completed.

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c. New IFRSs in issue but not yet endorsed and issued into effect by the FSC

New IFRSs Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and its Associate or Joint Venture” IFRS 17 “Insurance Contracts” Amendments to IAS 1 “Classification of Liabilities as Current or Non-current”	Effective Date Announced by IASB (Note)
	To be determined by IASB January 1, 2021 January 1, 2022

Note: Unless stated otherwise, the above New IFRSs are effective for annual reporting periods beginning on or after their respective effective dates.

As of the date the financial statements were authorized for issue, the Corporation is continuously assessing the possible impact that the application of above standards and interpretations will have on the Corporation’s financial position and financial performance, and will disclose the relevant impact when the assessment is completed.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a. Statement of compliance

The parent company only financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

b. Basis of preparation

The parent company only financial statements have been prepared on the historical cost basis except for financial instruments, investment properties which are measured at fair value and net defined benefit assets which are measured at the present value of the defined benefit obligation less the fair value of plan assets.

1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;
2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for an asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and
3) Level 3 inputs are unobservable inputs for an asset or liability.

When preparing its parent company only financial statements, the Corporation used equity method to account for its investment in subsidiaries and associates. In order for the amounts of the net profit for the year, other comprehensive income for the year and total equity in the parent company only financial statements to be the same with the amounts attributable to the owner of the Corporation in its consolidated financial statements, adjustments arising from the differences in accounting treatment between parent company only basis and consolidated basis were made to investments accounted for using equity method, share of profit or loss of subsidiaries and associates, share of other comprehensive income or loss of subsidiaries and associates and related equity items, as appropriate, in the parent company only financial statements.

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The properties were leased out to subsidiaries for their operation, and are classified as property plant and equipment in consolidated financial statements. Under IFRSs, these properties are classified as investment properties in parent company only financial statements. In 2014, the subsequent measurement of investment properties were changed from cost less accumulated depreciation model to fair value model.

In order for the amounts of the net profit for the year and total equity in the parent company only financial statements to be the same with the amounts attributable to the owners of the Corporation in its consolidated financial statements, the investment properties leased out to entities were measured at fair value model with the decrease in total equity and net profit for the year recorded in “investments accounted for using equity method” and “share of profit or loss of subsidiaries and associates”.

Classification of Current and Non-current Assets and Liabilities

Current assets include:

a. Assets held primarily for the purpose of trading;
b. Assets expected to be realized within twelve months after the reporting period; and
c. Cash and cash equivalents unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

Current liabilities include:

a. Liabilities held primarily for the purpose of trading;
b. Liabilities due to be settled within 12 months after the reporting period, even if an agreement to refinance, or to reschedule payments, on a long-term basis is completed after the reporting period and before the parent company only financial statements are authorized for issue; and
c. Liabilities for which the Corporation does not have an unconditional right to defer settlement for at least 12 months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

Assets and liabilities that are not classified as current are classified as non-current.

Foreign Currencies

In preparing the parent company only financial statements, transactions in currencies other than the Corporation’s functional currency (i.e., foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions.

Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.

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For the purpose of presenting parent company only financial statements, the assets and liabilities of the Corporation’s foreign operations (including subsidiaries and associates in other countries that use currencies which are different from the currency of the Corporation) are translated into the presentation currency, the New Taiwan dollar, as follows: Assets and liabilities are translated at the exchange rates prevailing at the end of the reporting period; and income and expense items are translated at the average exchange rates for the period. The resulting currency translation differences are recognized in other comprehensive income.

Inventories

Investment in Subsidiaries

The Corporation uses the equity method to account for its investments in subsidiaries.

A subsidiary is an entity that is controlled by the Corporation.

Under the equity method, an investment in a subsidiary is initially recognized at cost and adjusted thereafter to recognize the Corporation’s share of profit or loss and other comprehensive income (loss) of the subsidiary. The Corporation also recognizes the changes in the Corporation’s share of equity of subsidiaries.

Changes in the Corporation’s ownership interest in a subsidiary that do not result in the Corporation losing control of the subsidiary are equity transactions. The Corporation recognizes directly in equity any difference between the carrying amount of the investment and the fair value of the consideration paid or received.

Any excess of the cost of acquisition over the Corporation’s share of net fair value of the identifiable assets and liabilities of a subsidiary at the date of acquisition is recognized as goodwill, which is included within the carrying amount of the investment and is not amortized. Any excess of the Corporation’s share of net fair value of the identifiable assets and liabilities over the cost of acquisition is recognized immediately in profit or loss.

The Corporation assesses its investment for any impairment by comparing the carrying amount with the estimated recoverable amount as assessed based on the entire financial statements of the invested company. Impairment loss is recognized when the carrying amount exceeds the recoverable amount. If the recoverable amount of the investment subsequently increases, the Corporation recognizes the reversal of the impairment loss; the adjusted post-reversal carrying amount should not exceed the carrying amount that would have been recognized (net of amortization or depreciation) had no impairment loss been recognized in prior years. An impairment loss recognized on goodwill cannot be reversed in a subsequent period.

When the Corporation loses control of a subsidiary, it recognizes the investment retained in the former subsidiary at its fair value at the date when control is lost. The difference between the fair value of the retained investment plus any consideration received and the carrying amount of the previous investment at the date when control is lost is recognized as a gain or loss in profit or loss. Besides, the Corporation accounts for all amounts previously recognized in other comprehensive income in relation to that subsidiary on the same basis as would be required if the Corporation had directly disposed of the related assets or liabilities.

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Profits or losses resulting from downstream transactions are eliminated in full only in the parent company only financial statements. Profits and losses resulting from upstream transactions and transactions between subsidiaries are recognized only in the parent company only financial statements only to the extent of interests in the subsidiaries that are not related to the Corporation.

Investment in Associates

An associate is an entity over which the Corporation has significant influence and which is neither a subsidiary nor an interest in a joint venture.

The Corporation uses the equity method to account for its investments in associates.

Under the equity method, investments in an associate are initially recognized at cost and adjusted thereafter to recognize the Corporation’s share of profit or loss and other comprehensive income of the associate. The Corporation also recognizes the changes in the Corporation’s share of equity of associates.

Any excess of the cost of acquisition over the Corporation’s share of net fair value of the identifiable assets and liabilities of an associate at the date of acquisition is recognized as goodwill, which is included within the carrying amount of the investment and is not amortized. Any excess of the Corporation’s share of net fair value of the identifiable assets and liabilities over the cost of acquisition, after reassessment, is recognized immediately in profit or loss.

When the Corporation subscribes for additional new shares of an associate at a percentage different from its existing ownership percentage, the resulting carrying amount of the investment differs from the amount of the Corporation’s proportionate interest in the associate. The Corporation records such a difference as an adjustment to investments with the corresponding amount charged or credited to capital surplus - changes in capital surplus from investments in associates accounted for using equity method. If the Corporation’s ownership interest is reduced due to its additional subscription of the new shares of the associate, the proportionate amount of the gains or losses previously recognized in other comprehensive income in relation to that associate is reclassified to profit or loss on the same basis as would be required if the investee had directly disposed of the related assets or liabilities. When the adjustment should be debited to capital surplus, but the capital surplus recognized from investments accounted for using equity method is insufficient, the shortage is debited to retained earnings.

When the Corporation transacts with its associate, profits and losses resulting from the transactions with the associate are recognized in the parent company only financial statements only to the extent of unrelated parties’ interests in the associate.

The Corporation’s share of comprehensive income of associates is recognized using the treasury stock method if there are reciprocal holdings between investors and investees. The reciprocally held shares of the Corporation are treated as treasury stocks and are deducted from the outstanding shares in computing basic earnings per share.

Property, Plant and Equipment

17 -

Properties in the course of construction are depreciated and classified to the appropriate categories of property, plant and equipment when completed and ready for intended use.

On derecognition of an item of property, plant and equipment, the difference between the sales proceeds and the carrying amount of the asset is recognized in profit or loss.

Investment Properties

Investment properties are properties held to earn rentals and/or for capital appreciation. Investment properties also include land held for a currently undetermined future use.

On derecognition of an investment property, the difference between the net disposal proceeds and the carrying amount of the asset is included in profit or loss.

Intangible Assets

On derecognition of an intangible asset, the difference between the net disposal proceeds and the carrying amount of the asset is recognized in profit or loss.

Impairment of Tangible and Intangible Assets

At the end of each reporting period, the Corporation reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered any impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. When it is not possible to estimate the recoverable amount of an individual asset, the Corporation estimates the recoverable amount of the cash-generating unit to which the asset belongs. Corporate assets are allocated to the smallest group of cash-generating units on a reasonable and consistent basis of allocation.

18 -

When an impairment loss is subsequently reversed, the carrying amount of the corresponding asset or cash-generating unit is increased to the revised estimate of its recoverable amount, but only to the extent of the carrying amount that would have been determined had no impairment loss been recognized on the asset or cash-generating unit in prior years. A reversal of an impairment loss is recognized in profit or loss.

Financial Instruments

Financial assets and financial liabilities are recognized when the Corporation becomes a party to the contractual provisions of the instruments.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to an acquisition or issuance of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

Financial assets

All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis.

a. Measurement category

Financial assets are classified into the following categories: Financial assets at FVTPL, financial assets at amortized cost, and investments in equity instruments at FVTOCI.

1) Financial assets at FVTPL

2) Financial assets at amortized cost

Financial assets that meet the following conditions are subsequently measured at amortized cost:

a) The financial asset is held within a business model whose objective is to hold financial asset in order to collect contractual cash flows; and
b) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Interest income is calculated by applying the effective interest rate to the gross carrying amount of the financial asset.

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3) Investments in equity instruments at FVTOCI

On initial recognition, the Corporation may make an irrevocable election to designate investments in equity instruments as at FVTOCI. Designation at FVTOCI is not permitted if the equity investment is held for trading or if it is contingent consideration recognized by an acquirer in a business combination.

Dividends on these investments in equity instruments are recognized in profit or loss when the Corporation’s right to receive the dividends is established, unless the dividends clearly represent a recovery of part of the cost of the investment.

b. Impairment of financial assets

The Corporation recognizes a loss allowance for expected credit losses (ECLs) on financial assets at amortized cost (including trade receivables) as well as finance lease receivables at the end of each reporting period.

The Corporation always recognizes lifetime ECLs for trade receivables. For all other financial instruments and finance lease receivables, the Corporation recognizes lifetime ECLs when there has been a significant increase in credit risk since initial recognition. If, on the other hand, the credit risk on the financial instrument has not increased significantly since initial recognition, the Corporation measures the loss allowance for that financial instrument at an amount equal to 12-month ECLs.

Impairment loss on all financial instruments is recognized with a corresponding adjustment to their carrying amount through a loss allowance account.

c. Derecognition of financial assets

The Corporation derecognizes a financial asset only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party.

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Financial liabilities

a. Subsequent measurement

Except the following situation, all financial liabilities are measured at amortized cost using the effective interest method:

Financial liabilities are held for trading and are stated at fair value, with any gain or loss arising on remeasurement recognized in profit or loss and any interest paid on such liabilities is recognized in finance costs. The net gain or loss recognized in profit or loss does not incorporate any interest or dividends paid on the financial liability. Fair value is determined in the manner described in Note 29.

b. Derecognition of financial liabilities

Convertible bonds

The component parts of convertible bonds issued by the Corporation are classified separately as financial liabilities and equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

Derivative financial instruments

The Corporation enters into cross-currency swap contracts to manage its exposure to interest rate and foreign exchange rate risks.

Derivatives are initially recognized at fair value at the date the derivative contracts are entered into and are subsequently remeasured to their fair value at the end of each reporting period. The resulting gain or loss is recognized in profit or loss immediately. When the fair value of a derivative financial instrument is positive, the derivative is recognized as a financial asset; when the fair value of a derivative financial instrument is negative, the derivative is recognized as a financial liability.

21 -

Derivatives embedded in hybrid contracts that contain financial asset hosts that is within the scope of IFRS 9 are not separated; instead, the classification is determined in accordance with the entire hybrid contract. Derivatives embedded in non-derivative host contracts that are not financial assets that is within the scope of IFRS 9 (e.g. financial liabilities) are treated as separate derivatives when they meet the definition of a derivative; their risks and characteristics are not closely related to those of the host contracts; and the mixed contracts are not measured at FVTPL.

Provisions

Revenue Recognition

The Corporation identifies the contract with the customers, identifies the performance obligations in the contract, allocates the transaction price to the performance obligations, and recognizes revenue when performance obligations are satisfied.

When another party is involved in providing goods or services to a customer, the Corporation is a principal if it controls the specified good or service before that good or service is transferred to a customer; otherwise, the Corporation is acting as an agent. The principal recognizes revenues and costs associated with providing the goods or services at the gross amount, while an agent recognizes revenue at the net amount. When a specified good or service is a distinct good or service, the Corporation determines whether it is a principal or an agent for each specified good or service.

The Corporation is a principal if it obtains control of any one of the following:

a. Before the good or another asset transfers to the customer, the Corporation acquire the good or the control of asset from another party.
b. The right to a service to be performed by another party which gives the Corporation the ability to direct that party to provide the service to the customer on its behalf.
c. A good or service from another party that it then combines with other goods or services in providing a specified good or service to the customer.

Indicators to support the Corporation’s assessment of whether it controls a specified good or service include, but are not limited to, the following:

a. The Corporation is primarily responsible for fulfilling the promise to provide the specified good or service.
b. The Corporation has inventory risk before or after the specified good or service is transferred to the customer.
c. The Corporation has discretion in establishing the price of the specified good or service.

Leases

2019

At the inception of a contract, the Corporation assesses whether the contract is, or contains, a lease.

22 -

For a contract that contains a lease component and non-lease components, the Corporation allocates the consideration in the contract to each component on the basis of the relative stand-alone price and accounts for each component separately.

a. The Corporation as lessor

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

Under finance leases, the lease payments comprise fixed payments, variable lease payments which depend on an index or a rate, and residual value guarantees. The net investment in a lease is measured at (a) the present value of the sum of the lease payments receivable by a lessor and any unguaranteed residual value accrued to the lessor plus (b) initial direct costs and is presented as a finance lease receivable. Finance lease income is allocated to the relevant accounting periods so as to reflect a constant, periodic rate of return on the Corporation’s net investment outstanding in respect of leases.

Variable lease payments that do not depend on an index or a rate are recognized as income in the periods in which they are incurred.

When a lease includes both land and building elements, the Corporation assesses the classification of each element separately as a finance or an operating lease based on the assessment as to whether substantially all the risks and rewards incidental to ownership of each element have been transferred to the lessee. The lease payments are allocated between the land and the building elements in proportion to the relative fair values of the leasehold interests in the land element and building element of the lease at the inception of a contract. If the allocation of the lease payments can be made reliably, each element is accounted for separately in accordance with its lease classification. When the lease payments cannot be allocated reliably between the land and building elements, the entire lease is generally classified as a finance lease unless it is clear that both elements are operating leases; in which case, the entire lease is classified as an operating lease.

b. The Corporation as lessee

The Corporation recognizes right-of-use assets and lease liabilities for all leases at the commencement date of a lease, except for short-term leases and low-value asset leases accounted for applying a recognition exemption where lease payments are recognized as expenses on a straight-line basis over the lease terms.

Right-of-use assets are depreciated using the straight-line method from the commencement dates to the earlier of the end of the useful lives of the right-of-use assets or the end of the lease terms.

Lease liabilities are initially measured at the present value of the lease payments, which comprise fixed payments and variable lease payments which depend on an index or a rate. The lease payments are discounted using the interest rate implicit in a lease, if that rate can be readily determined. If that rate cannot be readily determined, the Corporation uses the lessee’s incremental borrowing rate.

23 -

Subsequently, lease liabilities are measured at amortized cost using the effective interest method, with interest expense recognized over the lease terms. When there is a change in a lease term or a change in future lease payments resulting from a change in an index or a rate used to determine those payments, the Corporation remeasures the lease liabilities with a corresponding adjustment to the right-of-use-assets. However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount of the remeasurement is recognized in profit or loss. Lease liabilities are presented on a separate line in the balance sheets.

Variable lease payments that do not depend on an index or a rate are recognized as expenses in the periods in which they are incurred.

2018

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

a. The Corporation as lessor

b. The Corporation as lessee

Operating lease payments are recognized as expenses on a straight-line basis over the lease term.

c. Leasehold land for own use

Employee Benefits

a. Short-term employee benefits

Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for the related services.

b. Retirement benefits

Payments to defined contribution retirement benefit plans are recognized as expenses when employees have rendered services entitling them to the contributions.

24 -

Net defined benefit liabilities (assets) represent the actual deficit (surplus) in the Corporation’s defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any refunds from the plans or reductions in future contributions to the plans.

c. Termination benefits

A liability for a termination benefit is recognized at the earlier of when the Corporation can no longer withdraw the offer of the termination benefit and when the Corporation recognizes any related restructuring costs.

Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax.

a. Current tax

According to the Income Tax Law, an additional tax of unappropriated earnings is provided for as income tax in the year the shareholders approve to retain earnings.

Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax provision.

b. Deferred tax

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the parent company only financial statements and the corresponding tax bases used in the computation of taxable profit.

Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.

Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates, except where the Corporation is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments and interests are only recognized to the extent that it is probable that there will be sufficient taxable profits against which to utilize the benefits of the temporary differences and they are expected to reverse in the foreseeable future.

25 -

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realized, 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 assets reflects the tax consequences that would follow from the manner in which the Corporation expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. If investment properties measured using the fair value model are non-depreciable assets, or are held under a business model whose objective is not to consume substantially all of the economic benefits embodied in the assets over time, the carrying amounts of such assets are presumed to be recovered entirely through sale.

c. Current tax and deferred tax for the year

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the Corporation’s accounting policies, management is required to make judgments, estimations and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered relevant. Actual results may differ from these estimates.

Fair Value Measurements and Valuation Process

If some of the Corporation’s assets and liabilities measured at fair value have no quoted prices in active markets, the Corporation determines whether to engage third party qualified appraisers for the application of appropriate valuation techniques for fair value measurements in accordance with related regulations or professional standards.

Where Level 1 inputs are not available, the engaged appraisers would determine appropriate inputs by referring to the existing lease contracts and rentals of similar properties in the vicinity of the Corporation’s investment properties. If the actual changes of inputs in the future differ from expectation, fair value might vary accordingly.

Information about the valuation techniques and inputs used in determining the fair value of various assets and liabilities is disclosed in Note 15.

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6. CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS
Checking accounts and demand deposits Petty cash Cash on hand Cash equivalents (investments with original maturities of less than 3 months) Time deposits Repurchase agreements collateralized by bonds		December 31
		2019 $ 778,468 815 345 1,346,850 349,261 $ 2,475,739	2018 $ 848,592 915 355 2,162,608 153,325 $ 3,165,795

The market rate intervals of time deposits and repurchase agreements collateralized by bonds at the end of the reporting period were as follows:

Time deposits Repurchase agreements collateralized by bonds	December 31
	2019 2018 2.33%-2.40% 2.80%-3.35% 0.53%-2.36% 2.52%

Time deposits with original maturities of more than 3 months in the amounts of $1,763,189 thousand and $462,275 thousand as of December 31, 2019 and 2018, respectively, are classified as financial assets at amortized cost in the balance sheets. Refer to Note 9.

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS - CURRENT

Financial assets at FVTPL Financial assets mandatorily classified as at FVTPL Non-derivative financial assets Beneficiary certificates Listed stocks Financial liabilities at FVTPL Financial liabilities held for trading Derivative financial liabilities (not under hedge accounting) Bond options (Note 20) Cross-currency swap contracts		December 31	December 31
		2019 $ 204,700 1,485,828 $ 1,690,528 $ 81,724 30,346 $ 112,070	2018 $ 135,400 1,037,426 $ 1,172,826 $ 223,501 44,717 $ 268,218

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The Corporation entered into cross-currency swap contracts to manage exposures to exchange rate fluctuations. The Corporation’s financial hedging strategy is to avoid most of the cash flow risk exposure. As of December 31, 2019 and 2018, outstanding cross-currency swap contracts not under hedge accounting were as follows:

were as follows:
Notional Amounts			Range of Interest
(In Thousands)	Maturity Date	Range of Interest Rates Paid	Rates Received
US$215,000	2021.9.15	-	2.68%-2.80%

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

Domestic investments Listed stocks Unlisted stocks Foreign investments Unlisted stocks		December 31	December 31	December 31	December 31
		2019 Current Non-current $ 2,237,578 $ 5,513,975 - 586,459 2,237,578 6,100,434 - 488,258 $ 2,237,578 $ 6,588,692		2018
		Current $ 2,237,578 - 2,237,578 - $ 2,237,578		Current $ 2,371,026 - 2,371,026 - $ 2,371,026	Non-current $ 4,812,769 573,373 5,386,142 - $ 5,386,142

These investments in equity instruments are not held for trading. Instead, they are held for medium to long-term strategic purposes. Accordingly, the management elected to designate these investments in equity instruments as at FVTOCI as they believe that recognizing short-term fluctuations in these investments’ fair value in profit or loss would not be consistent with the Corporation’s strategy of holding these investments for long-term purposes.

The board of directors of China Shanshui Cement Group Limited (CSCGL) announced on April 16, 2015 that the percentage of CSCGL’s securities held by the public fell below the prescribed minimum requirement of 25% according to the Main Board Listing Rules 8.08 of Hong Kong Exchanges and Clearing Limited (the “Exchange”). Therefore, the Exchange suspended the trading of CSCGL’s securities until the percentage of securities in public hands satisfies the minimum requirement.

The Corporation and its subsidiaries originally held 22.50% equity interest in CSCGL but the shareholding was reduced to 17.46% after the subscription mentioned above. However, Mrs. Wu Ling-Ling, the Corporation’s chief financial officer, was elected to be the executive director of CSCGL on May 23, 2018. As CSCGL already addressed the audit issues raised by the Exchange and the confirmed the potential dilution of shareholding in the Corporation’s interests in CSCGL, the Corporation objectively demonstrated that it was able to exercise significant influence over CSCGL although the Corporation only held less than 20% of the voting power. Accordingly, the Corporation’s investment in CSCGL was reclassified from financial assets at fair value through other comprehensive income to investments accounted for using the equity method at the closing price of the Exchange on October 31, 2018. Refer to Note 12.

Refer to Note 31 for information relating to financial assets at fair value through other comprehensive income pledged as collaterals.

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9. FINANCIAL ASSETS AT AMORTIZED COST

Time deposits with original maturities of more than 3 months		December 31	December 31
		2019 $ 1,763,189	2018 $ 462,275

Based on the Corporation’s assessment, the credit risk of these financial assets is not expected to be high and has not increased since initial recognition.

10. TRADE RECEIVABLES

TRADE RECEIVABLES
Trade receivables - sales Operating lease receivable Less: Allowance for impairment loss - sales		December 31
		2019 $ 947,444 23,119 (10,259) $ 960,304	2018 $ 983,780 17,778 (6,506) $ 995,052

Trade Receivables - Sales

The average credit period of receivables from sales of goods was 30-150 days. The Corporation reviews the recoverable amount of each individual trade debt at the end of the reporting period to ensure that adequate allowance is made for possible irrecoverable amounts. The Corporation obtains sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults.

The Corporation applies the simplified approach to providing for expected credit losses prescribed by IFRS 9, which permits the use of lifetime expected loss provision for all trade receivables. The expected credit losses on trade receivables are estimated by reference to past default experience of the debtor and an analysis of the debtor’s current financial position, adjusted for general economic conditions of the industry in which the debtors operate and an assessment of both the current as well as the forecast direction of economic conditions at the reporting date.

The Corporation writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery. For trade receivables that have been written off, the Corporation continues to engage in enforcement activity to attempt to recover the receivables due. Where recoveries are made, these are recognized in profit or loss.

December 31, 2019

Gross carrying amount Loss allowance (lifetime ECLs) Amortized cost	Less than 90 Days $ 887,685 - $ 887,685	91 to 180 Days $ 26,783 (10,259) $ 16,524	181 to 365 Days $ 29,518 - $ 29,518	Over 366 Days $ 3,458 - $ 3,458	Total $ 947,444 (10,259) $ 937,185

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December 31, 2018

Gross carrying amount Loss allowance (lifetime ECLs) Amortized cost	Less than 90 Days $ 960,363 - $ 960,363	91 to 180 Days $ 23,417 (6,506) $ 16,911	181 to 365 Days $ - - $ -	Over 366 Days $ - - $ -	Total $ 983,780 (6,506) $ 977,274

The above aging schedule was based on the invoice date.

The movements of the loss allowance of trade receivables were as follows:

Balance at January 1 Add: Impairment losses recognized on receivables Balance at December 31	2019 $ 6,506 3,753 $ 10,259	2018 $ 5,812 694 $ 6,506

11. INVENTORIES

INVENTORIES
Finished goods Work in progress Raw materials Supplies		December 31
		2019 $ 167,759 421,293 644,380 311,877 $ 1,545,309	2018 $ 248,752 471,871 757,790 184,982 $ 1,663,395

The cost of inventories recognized as cost of goods sold for the years ended December 31, 2019 and 2018 were $8,339,743 thousand and $8,309,912 thousand, respectively. The cost of goods sold included inventory write-downs of $52,791 thousand for the year ended December 31, 2018.

12. INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD

Investments in subsidiaries Investments in associates Less: Effect of investment properties at fair value method		December 31	December 31
		2019 $ 74,533,619 63,580,304 138,113,923 2,970,074 $ 135,143,849	2018 $ 66,031,029 62,396,158 128,427,187 2,794,297 $ 125,632,890

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a. Investments in subsidiaries

Listed stocks Asia Cement (China) Holdings Corp. (ACCHC) Unlisted stocks Der Ching Investment Corp. (DCI) Chiahui Power Corp. (CHP) Asia Cement (Singapore) Pte. Ltd. (ACSPL) Asia Investment Corp. (AIC) Yuan Long Stainless Steel Corp. (YLSS) Ya Tung Ready-Mixed Concrete Corp. (YTRMC) Fu Ming Transport Corp. (FMT) Yali Transport Corp. (YLT) Nan Hwa Cement Corp. (NHC) Asia Engineering Enterprise Corp. (AEE) Ya Li Precast and Prestressed Concrete Industries Corp. (YLPPC) Sunrise Industrial Holdings Ltd. (SIHL)		December 31	December 31
		2019 $ 41,411,828 13,656,200 6,059,603 4,141,226 3,243,862 1,969,817 1,801,331 1,410,458 265,154 261,372 182,274 75,572 54,922 33,121,791 $ 74,533,619	2018 $ 36,545,690 12,471,554 5,825,842 3,578,207 1,934,281 1,977,315 1,556,879 1,418,575 251,861 214,201 128,288 76,452 51,884 29,485,339 $ 66,031,029

At the end of the reporting period, the percentages of owners’ voting rights in subsidiaries held by the Corporation were as follows:

Corporation were as follows:
Name of Subsidiary ACCHC DCI CHP ACSPL AIC YLSS YTRMC FMT YLT NHC AEE YLPPC SIHL	December 31
	2019 2018 67.73% 67.73% 99.99% 99.99% 59.59% 59.59% 99.96% 99.96% 100.00% 100.00% 100.00% 100.00% 99.99% 99.99% 99.82% 99.82% 51.00% 51.00% 99.94% 99.94% 98.23% 98.23% 83.81% 83.81% 100.00% 100.00%

Fair values (Level 1) of investments in subsidiaries with available published price quotation are summarized as follows:

Name of Subsidiary ACCHC		December 31	December 31
		2019 $ 47,174,102	2018 $ 22,669,116

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b. Investment in associates

Material associates Listed stocks Far Eastern New Century Corporation (FENC) U-Ming Marine Transport Corp. (U-Ming) CSCGL Associates that are not individually material Unlisted stocks Yuan Ding Leasing Corp. (YDC) Yue Yuan Investment Corp. (YYI) Oriental Securities Corp. (OSC) FEDS Development Ltd. (FEDSDL) Yuan Ding Leasing Corp. (YDLC) Everstrong Iron & Steel Foundry Ltd. (EISF)		December 31	December 31
		2019 $ 39,074,139 10,462,271 5,248,933 54,785,343 3,218,379 2,560,533 1,921,049 640,867 373,481 80,652 8,794,961 $ 63,580,304	2018 $ 39,803,907 9,983,803 4,460,107 54,247,817 3,263,209 1,939,588 1,877,359 617,872 368,032 82,281 8,148,341 $ 62,396,158

At the end of the reporting period, the percentages of owners’ voting rights in associates held by the Corporation were as follows:

Corporation were as follows:
Name of Associate FENC U-Ming CSCGL YDC YYI OSC FEDSDL YDLC EISF	December 31
	2019 2018 23.77% 23.77% 39.25% 39.25% 7.62% 7.62% 35.50% 35.50% 29.92% 29.92% 18.93% 18.93% 25.00% 25.00% 43.60% 43.60% 40.40% 40.40%

1) Fair values (Level 1) of investments in associates with available published price quotation are summarized as follows:

summarized as follows:
Name of Associate FENC U-Ming CSCGL		December 31
		2019 $ 37,977,471 $ 11,145,159 $ 3,865,702	2018 $ 35,496,531 $ 10,697,362 $ 2,724,722

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2) The summarized financial information in respect of the Corporation’s material associates is set out below:

FENC:

Current assets Non-current assets Current liabilities Non-current liabilities Equity Proportion of the Corporation’s ownership Equity attributable to the Corporation Cross shareholdings Carrying amount Operating revenue Net profit for the year Other comprehensive (loss) income Total comprehensive income for the year Dividends received from FENC U-Ming:		December 31	December 31
	2019 2018 $ 31,823,888 $ 31,423,092 297,297,715 285,607,062 24,007,226 23,339,671 100,592,089 90,155,346 204,522,288 203,535,137 23.77% 23.77% 48,614,948 48,380,302 (9,540,809) (8,576,395) $ 39,074,139 $ 39,803,907 For the Year Ended December 31
		2019 $ 46,477,960 $ 10,732,669 (186,100) $ 10,546,569 $ 2,290,099	2018 $ 54,063,801 $ 12,028,294 855,093 $ 12,883,387 $ 1,526,733

Current assets Non-current assets Current liabilities Non-current liabilities Equity Proportion of the Corporation’s ownership Equity attributable to the Corporation Unrealized gain or loss with associates Carrying amount		December 31	December 31
		2019 $ 2,225,116 49,594,962 11,281,141 13,694,378 26,844,559 39.25% 10,536,490 (74,219) $ 10,462,271	2018 $ 1,985,037 50,008,362 17,453,879 8,913,985 25,625,535 39.25% 10,058,022 (74,219) $ 9,983,803

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Operating revenue Net profit for the year Other comprehensive income Total comprehensive income for the year Dividends received from U-Ming CSCGL:	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 1,062,972 $ 1,621,695 1,118,819 $ 2,740,514 $ 597,062	2018 $ 1,080,444 $ 1,668,840 2,007,257 $ 3,676,097 $ 398,041

Current assets Non-current assets Current liabilities Non-current liabilities Non-controlling interests Equity attributable to CSCGL Proportion of the Corporation’s ownership Equity attributable to the Corporation Goodwill Quarry right Carrying amount Operating revenue Net profit for the year Other comprehensive income (loss) Total comprehensive income for the year		December 31	December 31
	2019 2018 $ 26,673,504 $ 26,174,052 88,426,257 90,319,977 47,973,181 59,104,108 13,066,715 14,557,750 442,928 286,348 53,616,937 42,545,823 7.62% 7.62% 4,109,625 3,241,551 810,993 810,993 328,315 407,563 $ 5,248,933 $ 4,460,107 For the Year Ended December 31
		2019 $ 96,302,852 $ 13,578,105 8,286 $ 13,586,391	2018 $ 80,162,793 $ 9,856,967 (1,082,166) $ 8,774,801

As described in Note 8, the Corporation’s investments in CSCGL was reclassified from financial assets at fair value through other comprehensive income to investments accounted for using equity method in 2018.

3) Aggregate information of associates that are not individually material

The Corporation’s share of: Profit for the year Other comprehensive income Total comprehensive income for the year	For the Year Ended	For the Year Ended	December 31
		2019 $ 425,625 377,763 $ 803,388	2018 $ 211,771 184,884 $ 396,655

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4) The amounts of investments in associates pledged as collateral for bank borrowings are disclosed in Note 31.

All the subsidiaries and associates are accounted for using equity method.

The investments accounted for using equity method and the share of profit or loss and other comprehensive income of those investments for the years ended December 31, 2019 and 2018 were based on the subsidiaries’ and associates’ financial statements which have been audited for the same years.

13. PROPERTY, PLANT AND EQUIPMENT

a. Assets used by the Corporation - 2019

Cost Balance at January 1, 2019 Additions Disposals Transferred from completed construction Transferred from prepayments for leases Balance at December 31, 2019 Accumulated depreciation and impairment Balance at January 1, 2019 Disposals Depreciation expense Balance at December 31, 2019 Carrying amounts at December 31, 2019	Land $ 2,779,088 - - - - 2,779,088 - - - - $ 2,779,088	Buildings $ 4,217,415 837 (9,560 ) - - 4,208,692 3,662,692 (9,560 ) 53,764 3,706,896 $ 501,796	Equipment $ 16,780,128 95 (12,051 ) 15,279 - 16,783,451 16,435,209 (12,051 ) 115,881 16,539,039 $ 244,412	Other Equipment $ 5,758,416 126,077 (101,418 ) 70,554 27,568 5,881,197 5,193,447 (101,412 ) 247,609 5,339,644 $ 541,553	Property Under Construction $ 130,351 122,921 - (85,833 ) - 167,439 - - - - $ 167,439	Total $ 29,665,398 249,930 (123,029 ) - 27,568 29,819,867 25,291,348 (123,023 ) 417,254 25,585,579 $ 4,234,288

No impairment assessment was performed for the year ended December 31, 2019 as there was no indication of impairment.

The above items of property, plant and equipment are depreciated on a fixed-percentage-ondeclining-balance basis or on a straight-line basis over the estimated useful life of the asset taken apart into major component elements:

Building Main buildings 15-55 years Other facilities 2-15 years Equipment 2-20 years Other equipment 3-15 years

Refer to Note 31 for the carrying amount of property, plant and equipment pledged by the Corporation as collaterals for borrowings.

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b. 2018

Cost Balance at January 1, 2018 Additions Disposals Transferred from completed construction Reclassifications Transferred to other assets Balance at December 31, 2018 Accumulated depreciation and impairment Balance at January 1, 2018 Disposals Depreciation expense Reclassifications Transferred to other assets Balance at December 31, 2018 Carrying amounts at December 31, 2018	Land $ 2,779,025 63 - - - - 2,779,088 - - - - - - $ 2,779,088	Buildings $ 4,216,748 1,085 (418 ) - - - 4,217,415 3,605,414 (418 ) 57,696 - - 3,662,692 $ 554,723	Equipment $ 16,963,794 12,439 (177,648 ) 3,049 (21,506 ) - 16,780,128 16,483,956 (177,648 ) 150,407 (21,506 ) - 16,435,209 $ 344,919	Other Equipment $ 6,226,547 71,357 (618,597 ) 73,225 21,506 (15,622 ) 5,758,416 5,549,477 (618,592 ) 256,678 21,506 (15,622 ) 5,193,447 $ 564,969	Property Under Construction $ 118,126 88,499 - (76,274 ) - - 130,351 - - - - - - $ 130,351	Total $ 30,304,240 173,443 (796,663 ) - - (15,622 ) 29,665,398 25,638,847 (796,658 ) 464,781 - (15,622 ) 25,291,348 $ 4,374,050

No impairment assessment was performed for the year ended December 31, 2018 as there was no indication of impairment.

Building Main buildings 15-55 years Other facilities 3-15 years Equipment 2-20 years Other equipment 3-15 years

Refer to Note 31 for the carrying amount of property, plant and equipment pledged by the Corporation as collaterals for borrowings.

14. LEASE ARRANGEMENTS

a. Right-of-use assets - 2019

Right-of-use assets - 2019
	December 31,
		2019
Carrying amounts
Land	$	19,429
Buildings		376,924
Equipment		45,308
	$	441,661

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	For the Year	For the Year	For the Year
		Ended
	December		31,
		2019
Additions to right-of-use assets	$		-
Depreciation charge for right-of-use assets
Land	$	4,425
Buildings		40,337
Equipment		61,610
	$	106,372
Lease liabilities - 2019
	December		31,
		2019
Carrying amounts
Current	$	40,370
Non-current	$	44,787
Range of discount rate for lease liabilities was as follows:
	December		31,
		2019
Land		1.30%
Buildings		1.30%
Equipment		1.30%

b. Lease liabilities - 2019
c. Material lease-in activities and terms

The Corporation leases harbors, land, buildings and equipment for the use in business operations. Certain lease contracts specifies that lease payment will be adjusted on the basis of changes in market rental rates or announced land value prices. The Corporation does not have bargain purchase options to acquire the leasehold assets at the end of the lease terms.

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d. Other lease information

Lease arrangements under operating leases for the leasing out of investment properties are set out in Note 15.

2019

2019
	For the Year
		Ended
	December 31,
		2019
Expenses relating to short-term leases	$	84,817
Expenses relating to low-value asset leases	$	50
Expenses relating to variable lease payments not included in the measurement of
lease liabilities	$	9,643
Total cash outflow for leases	$	(181,439)

The Group has elected to apply the recognition exemption and, thus, did not recognize right-of-use assets and lease liabilities for these leases.

2018

Operating leases relate to leases of office spaces. The refundable deposit paid under operating lease contracts as of December 31, 2017 was $10,811 thousand.

The future minimum lease payments of non-cancellable operating lease commitments are as follows:

	December 31,
	2018
Not later than 1 year	$ 139,712
Later than 1 year and not later than 5 years	115,477
Later than 5 years	15,129
	$ 270,318

The rent expense on the above operating lease contracts was $132,541 thousand for the year ended December 31, 2018.

15. INVESTMENT PROPERTIES

INVESTMENT PROPERTIES
Leased investment properties Undeveloped investment properties		December 31
		2019 $ 36,082,384 6,031,826 $ 42,114,210	2018 $ 35,525,301 6,164,393 $ 41,689,694

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The movements of investment property were as follows:

		Leased	Undeveloped	Undeveloped	Undeveloped
		Investment		Investment
		Property			Property	Total
Balance at January 1, 2018	$	35,822,102	$		6,197,535	$ 42,019,637
Changes in fair value of investment properties		(298,069)			(33,142)	(331,211)
Additions		1,269			-	1,269
Disposals		(1)			-	(1)
Balance at December 31, 2018	$ 35,525,301		$		6,164,393	$ 41,689,694
Balance at January 1, 2019	$	35,525,301	$		6,164,393	$ 41,689,694
Changes in fair value of investment properties		532,249			(132,567)	399,682
Additions		24,834			-	24,834
Balance at December 31, 2019	$ 36,082,384		$		6,031,826	$ 42,114,210

The investment properties for lease were as follows:

a. On January 1, 1998, the Corporation granted FEDSDL the right to construct a shopping center on a parcel of land it owned with an area of 6,976 square meters located in Lin-Ya, Kaohsiung. As consideration for the right to construct and the continued use of the land for fifty years, FEDSDL shall pay the following: (a) land use right in the amount of $1,073,000 thousand and (b) annual rental at 5% of the reference price of such land announced by the local government. The proceeds of the land use rights were recorded as long-term deferred revenue, and recognized as rental revenue on a periodic basis.
b. The Corporation and Far Eastern Resources Development Co. (FERD) equally owned a parcel of land located at Tun Hwa South Road, Taipei City. Under an agreement entered into with YDC, the Corporation and FERD had agreed on the following: (a) construction of a twin tower building (Taipei Metro) by YDC on the said land, (b) continued use of the land without additional compensation for 30 years starting from the date of the completion of the building, (c) transfer to each of the Corporation and FERD 12% of the usable area of the building, and (d) transfer to FERD and the Corporation the remaining usable area of the building after the end of 30 years in exchange for the carrying amount of the property. In view of the foregoing agreement, the Corporation recorded the 12% of the building construction cost or $1,402,753 thousand as building acquired and as long-term deferred revenue, and recognized as revenue on a periodic basis.
c. Others mainly included the following:
1) Land in Shu-Lin - leased to YLPPC;
2) Land in Taichung Guan-Lien Industrial Zone - leased to NHC;
3) Land and buildings in Lin-Ko, Taichung and Hsi-Chih - leased to YTRMC;
4) Asia-Cement Building - leased to FEDS;
5) Pao-Ching Building - leased to Sofiva Genomics;
6) Land and building in Chayi City; and
7) Land and building in Hwalien - leased to YLT;
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The lease terms of the above are 1-10 years and the rents are paid monthly.

The Corporation’s undeveloped investment properties included a parcel of land located in Lin-Ya, Kaohsiung.

The fair value of investment properties was estimated using unobservable inputs (Level 3). The movements in the fair value were as follows:

Balance at January 1, 2018 Recognized in profit or loss (gain or loss from changes in fair value of investment property) Purchases Disposals Balance at December 31, 2018 Balance at January 1, 2019 Recognized in profit or loss (gain or loss from changes in fair value of investment property) Purchases Balance at December 31, 2019	Leased Investment Property $ 35,822,102 (298,069) 1,269 (1) $ 35,525,301 $ 35,525,301 532,249 24,834 $ 36,082,384	Undeveloped Investment Property $ 6,197,535 (33,142) - - $ 6,164,393 $ 6,164,393 (132,567) - $ 6,031,826	Total $ 42,019,637 (331,211) 1,269 (1) $ 41,689,694 $ 41,689,694 399,682 24,834 $ 42,114,210

assumptions used were as follows:
Estimated total selling price Rate of return Overall capital interest rate		December 31
		2019 $ 19,379,643 22% 5.99%	2018 $ 18,991,547 22% 6.08%

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The fair value of investment properties, except for undeveloped land, was measured using the income approach. The significant assumptions used were stated below. The increase in estimated future net cash inflows, or the decrease in discount rates would result in increase in the fair value.

Expected future cash inflows Expected future cash outflows Expected future cash inflows, net Discount rate		December 31	December 31
		2019 $ 45,637,919 1,936,955 $ 43,700,964 2.07%-4.50%	2018 $ 44,926,855 1,986,947 $ 42,939,908 2.07%-4.50%

The market rentals in the area where the investment property is located were between $1 thousand and $5 thousand per ping (i.e., per 3.3 square meters).

The rental income generated for the years ended December 31, 2019 and 2018 was $371,120 thousand and $356,365 thousand, respectively.

The expected future cash inflows to be generated by investment properties include rental income, interest income on rental deposits and disposal value. The rental income was extrapolated using the Corporation’s current rental contract, regional and market quotation, taking into account the annual rental growth rate; the income analysis covers a 10-year period, the interest income on rental deposits was extrapolated using the interest rate for one-year central bank-announced demand deposit interest rate; the disposal value was determined using the direct capitalization method under the income approach. The expected future cash outflows to be incurred by investment properties include expenditure such as land value taxes, house taxes, insurance premium, maintenance costs and others. This expenditure was extrapolated on the basis of the current level of expenditure, taking into account the future adjustment to the government-announced land value, and the tax rate promulgated under the House Tax Act.

Refer to Note 31 for the carrying amount of investment properties pledged by the Corporation as collaterals for borrowings.

16. INTANGIBLE ASSETS

Cost Balance at January 1, 2018 Additions Balance at December 31, 2018	Computer Software $ 159,611 2,693 162,304 (Continued)

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Accumulated amortization and impairment Balance at January 1, 2018 Amortization expense Balance at December 31, 2018 Carrying amounts at December 31, 2018 Cost Balance at January 1, 2019 Additions Balance at December 31, 2019 Accumulated amortization and impairment Balance at January 1, 2019 Amortization expense Balance at December 31, 2019 Carrying amounts at December 31, 2019	Computer Software $ 150,663 3,297 153,960 $ 8,344 $ 162,304 202 162,506 153,960 3,589 157,549 $ 4,957 (Concluded)

The above items of intangible assets are amortized on a straight-line basis over the estimated useful life of the asset. The estimated useful life of computer software is from 2 to 5 years.

17. PREPAYMENTS FOR LEASES

PREPAYMENTS FOR LEASES
Current asset (included in prepayments line item) Non-current asset OTHER ASSETS-NON-CURRENT Net defined benefit assets (Note 22) Prepaid investments Refundable deposits Others		December 31, 2018 $ 35,331 369,801 $ 405,132 December 31
		2019 $ 2,519,601 1,294,905 700,781 131 $ 4,515,418	2018 $ 1,886,734 1,911,179 1,394,853 129 $ 5,192,895

18. OTHER ASSETS-NON-CURRENT

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On March 23, 2017, the Corporation acquired 155 thousand issued shares of China Shanshui Investment Company Limited (CSI) in the amount of HK$577,662 thousand from six shareholders of CSI under a share purchase agreement. The Corporation already obtained the physical share certificates of the acquired CSI shares. Pursuant to the Articles of Association of CSI, the share ownership can only be recorded on the register of shareholders if the board of directors of CSI approves the share transfer. The Corporation submitted all necessary documents to CSI for registration of the share transfer. However, CSCGL and its subsidiaries obtained from the High Court of Hong Kong an injunction order by way of an ex-parte application on April 11, 2017. Pursuant to the injunction order, four out of the abovementioned six shareholders, Mi Jingtian, Zhao Liping, Li Maohuan and Yu Yuchuan, are prohibited from removing any of their assets in Hong Kong. Each of their assets’ value is up to RMB142 million (or its Hong Kong dollar equivalent), in particular, their shares in CSI and/or any proceeds from sales of any such CSI shares. The Corporation is neither a plaintiff nor a defendant in the aforesaid proceedings. But, for the purpose of securing and exercising the rights and interests of the acquired shares of CSI, the Corporation provided a bank guarantee of RMB142 million to the High Court of Hong Kong according to the High Court’s ruling on April 21, 2017. On the same day, the High Court of Hong Kong lifted the injunction order on the shares of CSI acquired by the Corporation. Since the payment liability event as agreed in the bank guarantee did not occur before due date and the bank guarantee expired on April 21, 2019, the Corporation’s obligations were terminated on the same day.

19. SHORT-TERM BILLS PAYABLE

SHORT-TERM BILLS PAYABLE
Commercial paper Less: Unamortized discounts on bills payable Interest rate (%)		December 31
		2019 $ 10,760,000 2,094 $ 10,757,906 0.38%-0.68%	2018 $ 11,440,000 2,896 $ 11,437,104 0.36%-0.80%

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Short-term bills payable were issued under guarantee obtained from financial institutions.

20. LONG-TERM LIABILITIES

LONG-TERM LIABILITIES
Bank loans Long-term commercial paper Less: Unamortized discounts Bonds Domestic bonds 1stunsecured bonds issued in 2014 1stunsecured bonds issued in 2016 1stunsecured bonds issued in 2019 2ndunsecured bonds issued in 2019 Overseas bonds 3rdEuro convertible bonds issued in 2018 - US$215,000 thousand Less: Current portion		December 31
		2019 $ 11,795,000 - - 11,795,000 - 6,000,000 6,500,000 3,500,000 16,000,000 6,280,807 34,075,807 3,000,000 $ 31,075,807	2018 $ 10,033,000 5,000,000 7,989 15,025,011 4,000,000 6,000,000 - - 10,000,000 6,192,567 31,217,578 4,000,000 $ 27,217,578

a. Bank loans are repayable in installments at varying amounts or in one lump-sum payment prior to January 22, 2022. The Corporation has signed long-term revolving credit facilities with banks. As of December 31, 2019 and 2018, interest rates were 0.89%-1.75% and 0.89%-1.70%, respectively.
b. Long-term commercial paper was issued by contract. As of December 31, 2018, interest rates were 0.83%-0.84%. The maturity date of the contract is December 19, 2020.
c. Domestic bonds are repayable in installments at varying amounts or in one lump-sum on maturity prior to August 16, 2024. As of December 31, 2019 and 2018, interest rates were 0.79%-0.88% and 0.80%-1.36%, respectively.
d. In order to redeem bonds to save interest expenses, on May 13, 2013, the Corporation issued 2[nd] US$220,000 thousand (equivalent to NT$6,551,380 thousand) zero coupon Euro convertible bonds due 2018.

The terms of the zero coupon Euro convertible bonds included the following:

1) Final redemption

Unless previously redeemed, repurchased and cancelled, or converted, the bonds will be redeemed on the maturity date at a redemption price equal to 100% of the unpaid principal amount thereof.

2) The bonds are convertible into the Corporation’s ordinary shares (“Shares”) at any time on or after June 23, 2013 and prior to the close of business on April 13, 2018. The initial conversion price was NT$48 per Share, determined on the basis of a fixed exchange rate of NT$29.53=US$1.00.
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3) Redemption at the option of the Corporation

4) Redemption at the option of the bondholders

Unless previously redeemed, repurchased and cancelled or converted, each holder will have the right to require the Corporation to redeem in whole or in part of the bonds held by such holder on May 13, 2016 at a redemption price equal to 100% of the principal amount thereof. (Refer to item 6 below for information on the redemption of bonds.)

5) The conversion price shall be subject to adjustment when there is occurrence of, including (but not limited to), the following:
a) Declaration of dividend in Shares or free distribution or bonus issue of Shares.
b) Subdivision, consolidation and reclassification of Shares.
c) Rights issues to shareholders.
d) Employee stock bonus.
e) Warrants issued to holders of Shares.
f) Issues of rights or warrants for equity-related securities to holders of Shares.
g) Capital distributions, other distributions to shareholders.
h) Issue of convertible or exchangeable securities other than to holders of Shares or on exercise of warrants.
i) Other issues of Shares.
j) Issue of equity related securities.
k) Capital reduction.
l) Tender or exchange offer.
m) Any other event or circumstance which would have an effect analogous to any of the events in a) to l) above.
6) As bondholders exercised the put option, the Corporation had redeemed the principal amount of US$217,000 thousand on May 11, 2016. After the redemption, the bonds outstanding in the amount of US$3,000 thousand had been paid on May 10, 2018.
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e. In order to repay debt, save interest expenses, and strengthen the Corporation’s financial structure, on September 21, 2018, the Corporation issued 3[rd] US$215,000 thousand (equivalent to NT$6,620,710 thousand) zero coupon Euro convertible bonds due 2023.

The terms of the zero coupon Euro convertible bonds included the following:

1) Final redemption

Unless previously redeemed, repurchased and canceled, or converted, the Bonds will be redeemed on the maturity date at the settlement equivalent of 103.04% of the unpaid principal amount thereof.

2) The bonds are convertible into the Corporation’s common shares (“Shares”) at any time on or after December 21, 2018 and prior to the close of business on August 22, 2023. The initial conversion price was NT$42.24 per Share, determined on the basis of a fixed exchange rate of NT$30.794=US$1.00.
3) Redemption at the option of the Corporation

4) Redemption at the option of the bondholders

Unless previously redeemed, repurchased and cancelled or converted, each holder will have the right to require the Corporation to redeem in whole or in part of the bonds held by such holder on September 21, 2021 at a redemption price equal to the settlement equivalent of 101.81% of the principal amount in U.S. dollars. Any U.S. dollar denominated amount payable in respect of the bonds will be converted into NT dollars using a fixed exchange rate and then converted back to a U.S. dollar amount using the applicable prevailing rate at the time of redemption.

5) The conversion price shall be subject to adjustment when there is occurrence of, including (but not limited to), the following:
a) Declaration of dividend in Shares or free distribution or bonus issue of Shares.
b) Subdivision, consolidation and reclassification of Shares.
c) Rights issues to shareholders.
d) Employee stock bonus.
e) Warrants issued to holders of Shares.
f) Issues of rights or warrants for equity-related securities to holders of Shares.
g) Capital distributions, other distributions to shareholders.
h) Issue of convertible or exchangeable securities other than to holders of Shares or on exercise of warrants.
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i) Other issues of Shares.
j) Issue of equity related securities.
k) Capital reduction.
l) Tender or exchange offer.
m) Any other event or circumstance which would have an effect analogous to any of the events in a) to l) above. The conversion price was NT$39.7 as of December 31, 2019.

21. DEFERRED REVENUE

Land use right Others Current Non-current		December 31	December 31
		2019 $ 790,753 133,052 $ 923,805 $ 75,912 $ 847,893	2018 $ 858,838 140,879 $ 999,717 $ 75,912 $ 923,805

a. The deferred revenue on land use rights in Lin-Ya, Kaohsiung granted to FEDSDL (Note 15) is amortized to income over 50 years on a straight-line basis.
b. The deferred revenue on land use rights of Taipei Metro granted to YDC (Note 15) is amortized to income over 30 years on a straight-line basis.

22. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

The Corporation adopted a pension plan under the Labor Pension Act (LPA), which is a state-managed defined contribution plan. Under the LPA, an entity makes monthly contributions to employees’ individual pension accounts at specified percentage of monthly salaries and wages.

b. Defined benefit plans

The defined benefit plan adopted by the Corporation in accordance with the Labor Standards Law is operated by the government. Pension benefits are calculated on the basis of the length of service and average monthly salaries of the six months before retirement. The Corporation contributes amounts equal to 8% of total monthly salaries and wages to a pension fund administered by the pension fund monitoring committee. Pension contributions are deposited in the Bank of Taiwan in the committee’s name. Before the end of each year, the Corporation assesses the balance in the pension fund. If the amount of the balance in the pension fund is inadequate to pay retirement benefits for employees who conform to retirement requirements in the next year, the Corporation is required to fund the difference in one appropriation that should be made before the end of March of the next year. The pension fund is managed by the Bureau of Labor Funds, Ministry of Labor (the “Bureau”); the Corporation has no right to influence the investment policy and strategy.

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The amounts included in the balance sheets in respect of the Corporation’s defined benefit plans were as follows:

as follows:
Present value of defined benefit obligation Fair value of plan assets Surplus Net defined benefit asset		December 31
		2019 $ 803,450 (3,323,051) (2,519,601) $ (2,519,601)	2018 $ 804,119 (2,690,853) (1,886,734) $ (1,886,734)

Movements in net defined benefit assets were as follows:

	Present Value	Present Value
	of	the Defined		Net Defined
		Benefit	Fair Value of	Benefit
	Obligation		the Plan Assets	Liability (Asset)
Balance at January 1, 2018	$	1,006,401	$ (2,523,022)	$ (1,516,621)
Service cost
Current service cost		9,207	-	9,207
Net interest expense (income)		12,077	(30,276)	(18,199)
Recognized in profit or loss		21,284	(30,276)	(8,992)
Remeasurement
Return on plan assets (excluding amounts
included in net interest)		-	(293,637)	(293,637)
Actuarial loss - changes in financial
assumptions		6,943	-	6,943
Actuarial loss - experience adjustments		(45,762)	-	(45,762)
Recognized in other comprehensive income		(38,819)	(293,637)	(332,456)
Benefits paid		(184,747)	156,082	(28,665)
Balance at December 31, 2018	$	804,119	$ (2,690,853)	$ (1,886,734)
Balance at January 1, 2019	$	804,119	$ (2,690,853)	$ (1,886,734)
Service cost
Current service cost		5,970	-	5,970
Net interest expense (income)		8,845	(29,599)	(20,754)
Recognized in profit or loss		14,815	(29,599)	(14,784)
Remeasurement
Return on plan assets (excluding amounts
included in net interest)		-	(661,669)	(661,669)
Actuarial loss - changes in financial
assumptions		6,530	-	6,530
Actuarial loss - experience adjustments		71,081	-	71,081
Recognized in other comprehensive income		77,611	(661,669)	(584,058)
Benefits paid		(93,095)	59,070	(34,025)
Balance at December 31, 2019	$	803,450	$ (3,323,051)	$ (2,519,601)

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Through the defined benefit plans under the Labor Standards Law, the Corporation is exposed to the following risks:

1) Investment risk: The plan assets are invested in domestic and foreign equity and debt securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau or under the mandated management. However, in accordance with relevant regulations, the return generated by plan assets should not be below the interest rate for a 2-year time deposit with local banks.
2) Interest risk: A decrease in the corporate bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the plan’s debt investments.
3) Salary risk: The present value of the defined benefit obligation is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the present value of the defined benefit obligation.

Discount rate(s) Expected rate(s) of salary increase	December 31
	2019 2018 1.00% 1.10% 2.00% 2.00%

Discount rate(s) 0.25% increase 0.25% decrease Expected rate(s) of salary increase 1% increase 1% decrease		December	31
		2019 $ (16,169) $ 16,697 $ 68,726 $ (61,703)	2018 $ (17,187) $ 17,768 $ 73,337 $ (65,545)

The major categories of plan assets at the end of the reporting period are disclosed based on the information announced by the Bureau:

information announced by the Bureau:
Equity instruments Deposited in financial institutions Others		December 31
		2019 86.82 8.26 4.92 100.00	2018 88.73 5.85 5.42 100.00

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The expected contributions to the plan for the next year The average duration of the defined benefit obligation		December	31
		2019 $ - 9.3 years	2018 $ - 10 years

23. EQUITY

a. Share capital

Share capital
Number of shares authorized (in thousands) Shares authorized Number of shares issued and fully paid (in thousands) Shares issued		December 31
		2019 4,000,000 $ 40,000,000 3,361,447 $ 33,614,472	2018 4,000,000 $ 40,000,000 3,361,447 $ 33,614,472

Fully paid ordinary shares, which have a par value of $10, carry one vote per share and carry a right to dividends.

The total of 350,000 thousand and 10,000 thousand shares of the Corporation’s authorized shares are reserved for the issuance of convertible bonds and employee share option, respectively.

b. Capital surplus

May be used to offset a deficit, distributed as cash dividends, or transferred to share capital (1) Donation The difference between consideration received or paid and the carrying amount of the subsidiaries’ net assets during actual acquisition or disposal Change of capital surplus of subsidiaries and associates accounted for using equity method (2) May be used to offset a deficit only Change of capital surplus of subsidiaries and associates accounted for using equity method (3) May not be used for any purpose Share warrants Change of capital surplus of subsidiaries and associates accounted for using equity method		December 31	December 31
		2019 $ 41,790 54,907 992,530 1,089,227 128,141 185,411 53,275 238,686 $ 1,465,054	2018 $ 41,790 54,907 992,530 1,089,227 38,085 185,411 49,831 235,242 $ 1,362,554

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1) Such capital surplus may be used to offset a deficit; in addition, when the Corporation has no deficit, such capital surplus may be distributed as cash dividends or transferred to share capital (limited to a certain percentage of the Corporation’s capital surplus and to once a year).
2) Such capital surplus from the effect of changes in associate’s ownership interest in its subsidiary that resulted from actual acquisition and disposal of equity may be used to offset a deficit or distributed as cash dividends or share dividends under Article 241-1 of Company Act.
3) Such capital surplus from the effect of changes in associate’s ownership interest in its subsidiary that resulted from equity transactions other than actual acquisition and disposal may be used to offset a deficit under Article 239-1 of Company Act.
c. Retained earnings and dividends policy

Under the Corporation’s dividends policy, where the Corporation has a profit at the end of a fiscal year, the Corporation shall first pay business income taxes based on law and then offset losses of previous years, and if there is any remaining profit, 10% of the balance shall be appropriated as legal reserve. In addition, appropriation for special reserve shall be made based on provisions of law. Any remaining amount of profit together with the accumulated undistributed earnings of the previous year shall be allocated for distribution to shareholders. However, depending on the condition of the business, part of the profit may be retained. In case of an increase in the capital of the Corporation, the shareholders’ bonus for the new shares in the year of issue shall be decided in the shareholders’ meeting. For the policies on distribution of employees’ compensation and remuneration of directors, refer to employees’ compensation and remuneration of directors in Note 25(f).

These appropriations shall be resolved by the shareholders in the following year and given effect to in the financial statements of that year.

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The appropriation of earnings and dividends per share for 2018 and 2017 approved in the shareholders’ meetings on June 24, 2019 and June 26, 2018, respectively, were as follows:

Legal reserve Special reserve Cash dividends Cash dividends per share (NT$)	Appropriation of Earnings	Appropriation of Earnings	Appropriation of Earnings
	For the Year Ended December 31
		2018 $ 1,111,709 $ 518,281 $ 9,412,052 $ 2.8	2017 $ 546,900 $ 943,188 $ 4,033,737 $ 1.2

The appropriation of earnings for 2019 had been proposed by the Corporation’s board of directors on March 25, 2020. The proposed appropriation of earnings and dividend per share were as follows:

Legal reserve Special reserve Cash dividends Cash dividends per share (NT$)	For the Year Ended December 31, 2019 $ 1,745,967 $ 804,347 $ 10,084,341 $ 3.0

Assuming that the shares reciprocally held by associates were not treated as treasury stock and not deducted from weighted average number of shares outstanding, the basic EPS would be NT$5.19 for the year ended December 31, 2019.

The appropriations of earnings for 2019 are subject to the resolution of the shareholders’ meeting to be held on June 23, 2020.

d. Special reserve recognized at the date of transition

The Corporation and its associates used and disposed of some of the related assets; accordingly, special reserve reversed to unappropriated earnings amounted to $548,152 thousand as of December 31, 2019.

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e. Other equity items

1) Exchange differences on translating the financial statements of foreign operations

Balance at January 1 Share of exchange difference of subsidiaries and associates accounted for using equity method Balance at December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ (2,641,364) (3,271,837) $ (5,913,201)	2018 $ (2,638,153) (3,211) $ (2,641,364)

2) Unrealized gain (loss) on financial assets at FVTOCI

For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
2019 2018 $ 5,268,916 $ 516,962 329,435 158,517 - (158,526) 2,363,096 1,340,746 26,587 2,520 (79,711) 3,408,697 $ 7,908,323 $ 5,268,916 For the Year Ended December 31
2019 $ 60,934 (8,793) $ 52,141 For the Year Ended		2018 $ 58,485 2,449 $ 60,934 December 31
	2019 $ 307,728 77,486 $ 385,214	2018 $ 307,728 - $ 307,728

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24. OPERATING REVENUE AND COSTS

a. Detail of client revenues contract

Operating revenues Sales of goods Rental revenue Total operating revenue, net Operating costs Cost of goods sold Rental cost Total operating cost Gross profit Contract balances Contract liabilities	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
	2019 2018 $ 8,612,328 $ 8,368,027 373,589 364,209 8,985,917 8,732,236 8,339,743 8,309,912 168,249 169,234 8,507,992 8,479,146 $ 477,925 $ 253,090 For the Year Ended December 31
		2019 $ 83,726	2018 $ 40,661

b. Contract balances

The changes in the balance of contract liabilities primarily result from the timing difference between the Corporation’s performance and the respective customer’s payment.

25. NET PROFIT

Net profit was as follows:

a. Other income

Other income
Dividends Interest income Others	For the Year Ended		December 31
		2019 $ 422,860 299,327 90,608 $ 812,795	2018 $ 405,773 114,003 72,669 $ 592,445

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b. Other gains and losses

For the Year Ended	For the Year Ended	December 31
2019 $ 673,850 399,682 (69,940) (56,435) 40 (133,087) $ 814,110 For the Year Ended		2018 $ 171,737 (331,211) 36,987 (61,313) 4,053 (462,053) $ (641,800) December 31
2019 $ 367,573 1,618 388 (230) $ 369,349 For the Year Ended		2018 $ 332,211 - - (227) $ 331,984 December 31
2019 2018 $ 230 $ 227 0.758%-0.988% 0.726%-1.139% For the Year Ended December 31
	2019 $ 521,270 1,380 976 $ 523,626 $ 3,589	2018 $ 462,524 1,783 474 $ 464,781 $ 3,297

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e. Employee benefits expense

Post-employment benefits (Note 22) Defined contribution plans Defined benefit plans Short-term benefits Salary Remuneration of directors Labor and health insurance Other employees-related expenses Total employee benefits expense		For the Year Ended December 31, 2019	For the Year Ended December 31, 2019
		Operating Costs $ 10,018 (8,885) 391,835 - 31,264 9,946 $ 434,178	Operating Expenses Non-operating Expenses $ 3,987 $ - (5,899) - 232,757 9,492 231,712 - 11,290 (1) 4,350 6 $ 478,197 $ 9,497	Total $ 14,005 (14,784) 634,084 231,712 42,553 14,302 $ 921,872

Post-employment benefits (Note 22) Defined contribution plans Defined benefit plans Short-term benefits Salary Remuneration of directors Labor and health insurance Other employees-related expenses Total employee benefits expense		For the Year Ended December 31, 2018	For the Year Ended December 31, 2018
		Operating Costs $ 10,268 (5,211) 495,567 - 31,453 12,551 $ 544,628	Operating Expenses Non-operating Expenses $ 4,450 $ 80 (3,781) - 142,661 3,200 225,074 - 11,001 153 4,564 70 $ 383,969 $ 3,503	Total $ 14,798 (8,992) 641,428 225,074 42,607 17,185 $ 932,100

For the year of 2019 and 2018, the Corporation had average 495 and 529 employees, respectively, which included both 12 non-employee directors for both years.

The Corporation’s average labor cost were $1,429 thousand and $1,368 thousand, respectively, for the years ended 2019 and 2018. Average salary and bonus were $1,313 thousand and $1,241 thousand, respectively, for the years ended 2019 and 2018. The Corporation’s average salary and bonus increased by 5.80% year over year.

f. Employees’ compensation and remuneration of directors

The Corporation accrued employees’ compensation and remuneration of directors at the rates between 1% and 4% and no higher than 2.5%, respectively, of net profit before income tax, employees’ compensation, and remuneration of directors. The employees’ compensation and remuneration of directors for the years ended December 31, 2019 and 2018 which have been approved by the Corporation’s board of directors on March 25, 2020 and March 21, 2019, respectively, were as follows:

Employees’ compensation Remuneration of directors	For the Year Ended December 31	For the Year Ended December 31
	2019 Cash Share $ 261,064 $ - 230,296 -	2018
		Cash Share $ 253,436 $ - 223,658 -

If there is a change in the amounts after the annual financial statements are authorized for issue, the differences are recorded as a change in the accounting estimate.

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There is no difference between the actual amounts of employees’ compensation and remuneration of directors paid and the amounts recognized in the financial statements for the years ended December 31, 2018 and 2017.

26. INCOME TAXES RELATING TO CONTINUING OPERATIONS

a. Major components of tax expense (income) recognized in profit or loss:

For the Year Ended December 31 2019 2018 Current tax In respect of the current year $ 308,961 $ - Income tax on unappropriated earnings - 19,711 Adjustments for prior years 25,138 (9) 334,099 19,702 Deferred tax In respect of the current year 362,328 1,022,598 Adjustments to deferred tax attributable to changes in tax rates and laws - 35,338 362,328 1,057,936 Income tax expense recognized in profit or loss $ 696,427 $ 1,077,638 A reconciliation of accounting profit and income tax expenses is as follows: For the Year Ended December 31 2019 2018 Profit before tax from continuing operations $ 18,156,100 $ 12,194,732 Income tax expense calculated at the statutory rate $ 3,631,220 $ 2,438,946 Nondeductible expenses in determining taxable income 20,062 44,394 Tax-exempt income (1,477,601) (1,114,646) Unrecognized temporary differences (1,274,745) (301,182) Tax on changes in fair value of investment properties (16,328) (32,651) Unrecognized loss carryforwards - 23,075 Income tax on unappropriated earnings - 19,711 Adjustments for prior years’ tax 25,138 (9) Tax credit - income from sources in Mainland China (211,319) - Income tax expense recognized in profit or loss $ 696,427 $ 1,077,638	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 18,156,100 $ 3,631,220 20,062 (1,477,601) (1,274,745) (16,328) - - 25,138 (211,319) $ 696,427	2018 $ 12,194,732 $ 2,438,946 44,394 (1,114,646) (301,182) (32,651) 23,075 19,711 (9) - $ 1,077,638

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b. Income tax recognized in other comprehensive income

Income tax recognized in other comprehensive income
Deferred tax In respect of the current year: Fair value changes of financial assets at FVTOCI Remeasurement on defined benefit plans Total income tax recognized in other comprehensive income	For the Year Ended		December 31
		2019 $ - (116,811) $ (116,811)	2018 $ (158,526) (66,491) $ (225,017)

c. Current tax assets and liabilities

Current tax assets and liabilities
Current tax assets Tax refund receivable Current tax liabilities Income tax payable		December 31
		2019 $ - $ 298,368	2018 $ 9,022 $ 8,477

d. Deferred tax assets and liabilities

The movements of deferred tax assets and deferred tax liabilities were as follows:

For the year ended December 31, 2019

Deferred tax assets Temporary differences Other financial assets and liabilities Property, plant and equipment Others Deferred tax liabilities Temporary differences Investment properties Land value increment tax Unappropriated earnings of subsidiaries and associates Defined benefit obligation Property, plant and equipment Other financial assets and liabilities Allowance for impairment loss Others	Opening Balance Recognized in Profit or Loss Recognized in Other Comprehensive Income $ 8,944 $ 3,804 $ - 3,659 (2,492) - - 2,548 - $ 12,603 $ 3,860 $ - $ 3,598,284 $ (16,328) $ - 3,427,438 - - 1,610,261 380,083 - 337,636 9,762 116,811 32,876 6,806 - 11,371 (11,371) - 296 (296) - 2,468 (2,468) - $ 9,020,630 $ 366,188 $ 116,811	Closing Balance $ 12,748 1,167 2,548 $ 16,463 $ 3,581,956 3,427,438 1,990,344 464,209 39,682 - - - $ 9,503,629

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For the year ended December 31, 2018

Deferred tax assets Temporary differences FVTOCI financial assets FVTPL financial assets and liabilities Property, plant and equipment Deferred tax liabilities Temporary differences Investment properties Land value increment tax Unappropriated earnings of subsidiaries Defined benefit obligation Property, plant and equipment Other financial assets and liabilities Allowance for impairment loss Others	Opening Balance Recognized in Profit or Loss Recognized in Other Comprehensive Income $ 158,526 $ - $ (158,526) - 8,944 - 10,460 (6,801) - $ 168,986 $ 2,143 $ (158,526) $ 3,630,935 $ (32,651) $ - 3,427,438 - - 563,866 1,046,395 - 244,549 26,596 66,491 21,746 11,130 - 4,670 6,701 - 84 212 - 772 1,696 - $ 7,894,060 $ 1,060,079 $ 66,491	Closing Balance $ - 8,944 3,659
		$ 12,603
		$ 3,598,284 3,427,438 1,610,261 337,636 32,876 11,371 296 2,468
		$ 9,020,630

e. The aggregate amount of temporary differences associated with investments for which deferred tax liabilities have not been recognized:

f. The income tax returns through 2017, have been assessed by the tax authorities.

27. EARNINGS PER SHARE

Unit: NT$ Per Share

		Unit: NT$ Per Share	Unit: NT$ Per Share
Basic earnings per share Diluted earnings per share	For	the Year Ended December 31
		2019 $ 5.56 $ 5.25	2018 $ 3.54 $ 3.49

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The earnings and weighted average number of ordinary shares outstanding used for the earnings per share computation were as follows:

Net Profit for the Year

Net Profit for the Year
Profit for the period attributable to owners of the Corporation Effect of potentially dilutive ordinary shares: Convertible bonds Earnings used in the computation of diluted earnings per share	For the Year Ended December 31
		2019 $ 17,459,673 (55,373) $ 17,404,300	2018 $ 11,117,094 26,638 $ 11,143,732

Weighted average number of ordinary shares outstanding (in thousand shares):

Weighted average number of ordinary shares outstanding (in thousand	shares):	shares):
Weighted average number of ordinary shares in computation of basic earnings per share Effect of potentially dilutive ordinary shares: Employees’ compensation Convertible bonds Weighted average number of ordinary shares used in the computation of diluted earnings per share	For the Year Ended		December 31
		2019 3,138,664 6,888 166,769 3,312,321	2018 3,139,152 8,585 44,656 3,192,393

28. CAPITAL MANAGEMENT

The Corporation manages its capital to ensure that it will be able to continue as a going concern while maximizing the return to stakeholders through the optimization of the debt and equity balance.

The capital structure of the Corporation consists of net debt (borrowings offset by cash and cash equivalents) and equity of the Corporation (comprising issued capital, reserves, retained earnings, other equity).

The Corporation is not subject to any externally imposed capital requirements.

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Key management personnel of the Corporation review the capital structure on an annual basis. As part of this review, the key management personnel consider the cost of capital and the risks associated with each class of capital. Based on recommendations of the key management personnel, in order to balance the overall capital structure, the Corporation may adjust the amount of dividends paid to shareholders and the amount of new debt issued or existing debt redeemed.

29. FINANCIAL INSTRUMENTS

a. Fair value of financial instruments not measured at fair value

December 31, 2019

Carrying Fair Value Amount Level 1 Level 2 Level 3 Financial liabilities Financial liabilities measured at amortized cost Bonds payable (included current portion) $ 22,280,807 $ 24,156,832 $ - $ - December 31, 2018 Carrying Fair Value Amount Level 1 Level 2 Level 3 Financial liabilities Financial liabilities measured at amortized cost Bonds payable (included current portion) $ 16,192,567 $ 16,719,158 $ - $ - Fair values of financial instruments measured at fair value on a recurring basis 1) Fair value hierarchy December 31, 2019 Level 1 Level 2 Level 3 Financial assets at FVTPL Overseas listed stocks $ 1,485,828 $ - $ - Beneficiary certificates 204,700 - - $ 1,690,528 $ - $ -	Fair Value
	Level 1 Level 2 Level 3 $ 24,156,832 $ - $ - Fair Value	Total $ 24,156,832
		Total $ 16,719,158 Total $ 1,485,828 204,700 $ 1,690,528 (Continued)

b. Fair values of financial instruments measured at fair value on a recurring basis
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Financial assets at FVTOCI Investments in equity instruments at FVTOCI Domestic listed stocks Domestic unlisted stocks Overseas unlisted shares Bond options Cross-currency swap contracts December 31, 2018 Financial assets at FVTPL Overseas listed stocks Beneficiary certificates Financial assets at FVTOCI Investments in equity instruments at FVTOCI Domestic listed stocks Domestic unlisted stocks Financial liabilities at FVTPL Cross-currency swap contracts Bond options	Level 1 $ 7,751,553 - - $ 7,751,553 $ - - $ - Level 1 $ 1,037,426 135,400 $ 1,172,826 $ 7,183,796 - $ 7,183,796 $ - - $ -	Level 2 $ - - - $ - $ - - $ - Level 2 $ - - $ - $ - - $ - $ - - $ -	Level 3 $ - 586,459 488,258 $ 1,074,717 $ 81,724 30,346 $ 112,070 Level 3 $ - - $ - $ - 573,372 $ 573,372 $ 44,717 223,501 $ 268,218	Total $ 7,751,553 586,459 488,258 $ 8,826,270 $ 81,724 30,346 $ 112,070 (Concluded) Total $ 1,037,426 135,400 $ 1,172,826 $ 7,183,796 573,372 $ 7,757,168 $ 44,717 223,501 $ 268,218

There were no transfers between Levels 1 and 2 for the years ended December 31, 2019 and 2018.

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2) Reconciliation of Level 3 fair value measurements of financial instruments

Balance at January 1, 2019

Recognized in profit or loss
Net gain on financial liabilities at FVTPL
Recognized in other comprehensive income
Unrealized loss on financial assets at FVTOCI
Purchases
Transfers into Level 3

Balance at December 31, 2019

Balance at January 1, 2018

Recognized in profit or loss
Net loss on financial liabilities at FVTPL

Recognized in other comprehensive income
Unrealized gain on financial assets at FVTOCI
Purchases

Transfers out of Level 3

Balance at December 31, 2018

Financial
Liabilities at
Financial Assets
at FVTOCI
FVTPL
Equity
Derivatives
Instruments
$ (268,218) $ 573,372
156,148
-
-
(232,982)
-
118,055
-

616,272
$ (112,070)
$ 1,074,717
$ -
$ 4,436,621

(47,303)
-
-
411,456

(220,915)
-
-
(4,274,705)
$ (268,218)
$ 573,372

3) Valuation techniques and inputs applied for Level 3 fair value measurement
a) The fair values of convertible bond options are determined using the information available from the counterparty for valuation based on the option pricing model. The option pricing model incorporates the present value techniques and reflects both the time value and the intrinsic value of options.
b) The fair value of cross currency swap contracts is determined using the information available from the counterparty for valuation. The counterparty measures the fair value of a cross currency swap contracts using the discounted cash flows model. Future cash flows are estimated based on observable forward exchange rates at balance sheet dates and contract forward rates and discounted at rates that reflect the credit risk of various counterparties.
c) The fair value of equity securities suspended for trading and therefore without quoted price was determined by using the weighted average of values calculated under market-based approach. In market-based approach, the fair value of the investee is measured by weighted average multiple value of (i) EV/sales, (ii) EV/EBITDA, and (iii) P/B of other comparable listed companies. Liquidity risk parameters need to be taken into account when using this approach.
- i. EV/Sales: Enterprise value ÷ Sales.
- ii. EV/EBITDA: Enterprise value ÷ Earnings before interest, taxes, depreciation and amortization.

iii. P/B: Price ÷ Book value.

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d) The fair values of unlisted stocks are determined by using the asset approach or the market approach. In the asset approach, the fair values are estimated by using the net asset value measured at fair value based on the unlisted investees’ latest financial statements, while taking into account the liquidity discount and non-controlling interest discount. In the market approach, the fair values are estimated based on the market transaction prices of comparable companies with similar industrial and business characteristics and liquidity discount are considered.
c. Categories of financial instruments

Financial assets Fair value through profit or loss Financial assets at amortized cost (1) Financial assets at FVTOCI Financial liabilities Financial liabilities at FVTPL Financial liabilities at amortized cost (2)	December 31 2019 2018 $ 1,690,528 $ 1,172,826 5,355,731 4,747,829 8,826,270 7,757,168 112,070 268,218 46,514,261 44,258,001

1) The balances include financial assets at amortized cost, which comprise cash and cash equivalents, notes receivable, trade receivables and other receivables.
2) The balances include financial liabilities at amortized cost, which comprise short-term bills payable, trade and other payables, bonds issued and long-term loans.
d. Financial risk management objectives and policies

The Corporation’s major financial instruments include equity and debt investments, trade receivables, trade payables, bonds payable, borrowings and lease liabilities. The Corporation’s Corporate Treasury function provides services to the business, coordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the Corporation through internal risk reports which analyze exposures by degree and magnitude of risks. These risks include market risk (including foreign currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

The Corporation mitigates the effects of these risks by using derivative financial instruments to hedge risk exposures. The use of financial derivatives is governed by the Corporation’s policies approved by the board of directors, which provides written principles on foreign currency risk, interest rate risk, credit risk, the use of financial derivatives and non-derivative financial instruments, and the investment of excess liquidity. Compliance with policies and exposure limits is reviewed by the internal auditors on a continuous basis.

1) Market risk

The Corporation’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates (see (a) below) and interest rates (see (b) below). The Corporation enters into cross-currency swap contracts to mitigate its exposure to foreign currency risk and interest risk.

a) Foreign currency risk

The Corporation have foreign currency sales and purchases and foreign currency financing activities, which expose the Corporation to foreign currency risk.

64 -

The carrying amounts of the Corporation’s foreign currency denominated monetary assets and monetary liabilities and derivatives exposed to foreign currency risk at the end of the reporting period are set out in Note 34.

Sensitivity analysis

The Corporation was mainly exposed to the RMB and USD.

The following table details the Corporation’s sensitivity to a 5% increase and decrease in the functional currency against the relevant foreign currencies. The sensitivity rate of 5% is used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis included only outstanding foreign currency denominated monetary items less notional amounts of cross-currency swap. The analysis assumed a 5% change in foreign currency rates at the end of the reporting period. A positive number below indicates an increase in pre-tax profit assuming the New Taiwan dollars weakened by 5% against the relevant currency. For a 5% strengthening of New Taiwan dollars against the relevant currency, there would be an equal and opposite impact on pre-tax profit and the balances shown below would be negative.

be negative.
Increase (decrease) in pre-tax profit	RMB Impact For the Year Ended December 31 2019 2018 $ 41,450 $ 42,224	USD Impact
		For the Year Ended December 31
		2019 2018 $ 186,176 $ 161,809

b) Interest rate risk

The Corporation is exposed to interest rate risk because the Corporation borrows funds at both fixed and floating interest rates. The risk is managed by the Corporation by maintaining an appropriate mix of fixed and floating rate borrowings and using cross-currency swap contracts.

The carrying amounts of the Corporation’s financial assets and financial liabilities with exposure to changes in interest rates at the end of the reporting period were as follows:

Fair value interest rate risk Financial assets Financial liabilities Cash flow interest rate risk Financial assets Financial liabilities	December 31
	2019 2018 $ 3,474,879 $ 2,793,778 33,235,940 32,621,682 743,930 1,536,461 11,795,000 10,033,000

Sensitivity analysis

The sensitivity analysis below is based on the Corporation’s exposure to changes in interest rates of non-derivative instruments at the end of the reporting period.

65 -

If interest rates had been 0.01% higher/lower and all other variables were held constant, the Corporation’s pre-tax profit for the years ended December 31, 2019 and 2018 would have decreased/increased by $977 thousand and $1,049 thousand, respectively, mainly due to the Corporation’s exposure to changes in interest rates of its variable-rate bank borrowings and bank deposits.

c) Other price risk

The Corporation is exposed to price risk through its investments in listed equity securities and beneficiary certificates of funds.

Sensitivity analysis

The sensitivity analysis below is based on the exposure to investment position price risks at the end of the reporting period.

If investment position prices had been 1% higher/lower, pre-tax profit for the year ended December 31, 2019 and 2018 would have increased/decreased by $16,905 thousand and $11,728 thousand, respectively, as a result of the changes in fair value of financial assets at fair value through profit or loss, and the pre-tax other comprehensive income for the year ended December 31, 2019 and 2018 would have increased/decreased by $77,516 thousand and $71,838 thousand, respectively, as a result of the changes in fair value of financial assets at fair value through other comprehensive income.

2) Credit risk

Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in financial loss to the Corporation. As at the end of the reporting period, the Corporation’s maximum exposure to credit risk which would cause a financial loss to the Corporation due to the failure of counterparties to discharge an obligation and financial guarantees provided by the Corporation is equal to the carrying amount of the financial assets as stated in the balance sheets. The Corporation adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. The Corporation only transacts with entities that are rated the equivalent of investment grade and above. The Corporation uses publicly available financial information and its own trading records to rate its major customers. The Corporation’s exposure and the credit ratings of its counterparties are continuously monitored.

The counterparties in trade receivables consist of a large number of clients in different industries and regions. The Corporation evaluates clients’ financial condition continuously.

Credit risk represents the potential negative impact on the financial assets of the Corporation if counterparties or third parties breach the contracts. The Corporation evaluates credit risk exposure on contracts with positive carrying value. The Corporation evaluated the credit risk exposure as immaterial because all counterparties are reputable financial institutions and companies with good credit ratings.

3) Liquidity risk

The Corporation manages liquidity risk by monitoring and maintaining a level of cash and cash equivalents deemed adequate to finance the Corporation’s operations and mitigate the effects of fluctuations in cash flows. In addition, management monitors the utilization of bank borrowings and ensures compliance with loan covenants.

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a) Liquidity and interest rate tables for non-derivative financial liabilities

The following tables detail the Corporation’s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The tables had been drawn up based on the undiscounted cash flows of financial liabilities from the earliest date on which the Corporation can be required to pay. The tables included both interest and principal cash flows.

December 31, 2019

December 31, 2019
On Demand or Less than 1 Month Non-derivative financial liabilities Non-interest bearing $ 492,858 Lease liabilities 3,427 Variable interest rate liabilities - Fixed interest rate liabilities - $ 496,285	1-3 Months $ 534,475 6,854 - 10,757,906 $ 11,299,235	3 Months to 1 Year $ 551,707 30,844 - 3,000,000 $ 3,582,551	1-5 Years $ 101,508 32,865 11,795,000 19,280,807 $ 31,210,180	5+ Years $ - 13,966 - -
				$ 13,966

Additional information about the maturity analysis for lease liabilities

Less than 1 Year 1-5 Years 5-10 Years 10-15 Years Lease liabilities $ 41,125 $ 32,865 $ 5,819 $ 5,819 December 31, 2018 On Demand or Less than 1 Month 1-3 Months 3 Months to 1 Year Non-derivative financial liabilities Non-interest bearing $ 396,962 $ 568,442 $ 585,020 Variable interest rate liabilities - - - Fixed interest rate liabilities 11,437,104 - 4,000,000 Finance guarantee contracts - - 23,249,487 $ 11,834,066 $ 568,442 $ 27,834,507	15-20 Years $ 2,328 1-5 Years $ 52,895 10,033,000 17,184,578 - $ 27,270,473	$	20+ Years $ - 5+ Years - - - -
		$	-

b) Liquidity and interest rate risk table for derivative financial liabilities

The following table details the Corporation’s liquidity analysis of its derivative financial instruments. The table is based on the undiscounted contractual net cash inflows and outflows on derivative instruments that settle on a net basis. When the amount payable or receivable is not fixed, the amount disclosed is determined by reference to the projected interest rates as illustrated by the yield curves at the end of the reporting period.

December 31, 2019

On Demand or Less than 1 Month 1-3 Months 3 Months to 1 Year Net settled Cross-currency swap contracts $ - $ (44,872) $ (135,109)	1-5 Years $ (135,109)	5+ Years $ -

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December 31, 2018

On Demand or Less than 1 Month 1-3 Months 3 Months to 1 Year Net settled Cross-currency swap contracts $ - $ (39,911) $ (139,437)	1-5 Years $ (322,827)	5+ Years $ -

e. Transfers of financial assets. None.
f. Offsetting financial assets and financial liabilities. None.
g. Reclassifications. None.

30. TRANSACTIONS WITH RELATED PARTIES

Details of transactions between the Corporation and other related parties are disclosed below.

Transactions with related parties are conducted under normal terms.

Balances and transactions between the Corporation and single related party are disclosed separately except when the amount is less than 10% of the total balances or transactions; otherwise, the amounts are lumped together as others.

a. Related party name and category

Related Party Name FMT DCI YLPPC ACSPL NHC AEE AIC YTRMC ACCHC YLT Ya Sing Ready-Mixed Concrete Corp. (YSRMC) Fu Shan Mineral Stone Co., Ltd. (FSMS) Fu Da Transportation Corp. (FDT) Jiangxi Yadong Cement Co., Ltd. (JYDC) Kowloon Cement Corp. Ltd. (KCC) Asia Oriental Concrete, LLC (AOC) FENC U-Ming YDC OSC FEDSDL EISF	Related Party Category
	Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Sub-subsidiary Sub-subsidiary Sub-subsidiary Sub-subsidiary Sub-subsidiary Sub-subsidiary Associate Associate Associate Associate Associate Associate (Continued)

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Related Party Name Related Party Category

Shih Hsin Storage & Transportation Co., Ltd. (SHSTC)	Associate
Pao-Good Industry Co., Ltd. (PGIC)	Associate
Far EasTone Telecommunications Co., Ltd.	Other
Far Eastern Department Store Ltd.	Other
Chu Feng Power Corporation, Preparatory Office	Other
Oriental Union Chemical Corp.	Other
Mr. Xu Yuanzhi Memorial Foundation	Other
Yuan Ze University	Other
New Century InfoComm Tech Co., Ltd.	Other
CHC Resources Corporation	Other
Far Eastern Resources Development Co.	Other
Far Eastern General Construction Inc.	Other
Far Eastern International Leasing Corporation	Other
U-Ming Transport (Singapore) Private Limited	Other
Ding Hotel Co., Ltd.	Other
Ding & Ding Management Consultants Co., Ltd.	Other
Ya Tung Department Store Ltd.	Other
Far Eastern Apparel Co., Ltd.	Other
Far Eastern Leasing Corporation	Other
Far Eastern Technical Consultants Co., Ltd.	Other
Far Eastern International Bank (FEIB)	Other
Far Eastern New Century (China) Corporation	Other

(Concluded)

b. Operating transactions

Operating transactions
Operating revenues Subsidiaries Associates Others Operating cost Subsidiaries Associates Others	For the Year Ended December 31
		2019 $ 2,519,628 250,841 130,451 $ 2,900,920 $ 501,149 612,257 237,420 $ 1,350,826	2018 $ 2,582,709 253,840 139,159 $ 2,975,708 $ 726,082 592,083 370,105 $ 1,688,270

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Receivables from related parties (including notes receivable, trade receivables and other receivables):

Subsidiaries YTRMC Others Associates Others		December 31	December 31
		2019 $ 348,763 93,564 442,327 12,012 9,485 $ 463,824	2018 $ 370,183 152,353 522,536 11,772 6,692 $ 541,000

Accounts payable and accrued expenses to related parties:

Subsidiaries Associates Others		December 31	December 31
		2019 $ 82,820 113,621 5,363 $ 201,804	2018 $ 84,014 97,764 6,326 $ 188,104

Prepayments:

Associates c. Transactions with FEIB Bank deposits (Note) Bank Loans Cross-currency swap contracts		December 31	December 31
		2019 2018 $ 15,000 $ 15,000 December 31
		2019 $ 930,024 $ - $ (1,415)	2018 $ 1,167,742 $ 400,000 $ (2,358)

As of December 31, 2019 and 2018, the notional principal of the above outstanding cross-currency swap contracts were both US$15,000 thousands.

Note: The balances included amounts recognized as financial assets measured at amortized cost, and other non-current assets (refundable deposits).

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d. Compensation of key management personnel

The amounts of the compensation of directors and other key management personnel for the years ended December 31, 2019 and 2018 were as follows:

December 31, 2019 and 2018 were as follows:
Short-term employee benefits Post-employment benefits	For the Year Ended December 31
		2019 $ 291,657 864 $ 292,521	2018 $ 268,538 756 $ 269,294

The remuneration of directors and key executives is determined by the remuneration committee based on the performance of individuals and market trends.

e. Other transactions with related parties

1) Operating expense - rental

Associates Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2019 $ 44,924 5,597 $ 50,521	2018 $ 44,912 6,084 $ 50,996

2) Acquisitions of property, plant and equipment

Others 3) Acquisitions of investment properties Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
	2019 2018 $ - $ 34 For the Year Ended December 31
		2019 $ -	2018 $ 337

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31. ASSETS PLEDGED AS COLLATERAL

The following assets are provided as collaterals for short-term and long-term bank borrowings:

Investment properties Investments accounted for using equity method Financial assets at fair value through other comprehensive income - current Property, plant and equipment, net		December 31	December 31
		2019 $ 13,855,572 11,287,882 1,045,450 857,003 $ 27,045,907	2018 $ 13,840,249 11,388,997 1,107,800 886,829 $ 27,223,875

32. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

As of December 31, 2019, the Corporation had the following significant commitments and contingencies: a. Unused letters of credit of EUR145 thousand.

b. Guarantee notes issued for related parties:

The Corporation AIC DCI NHC YTRMC YLPPC AEE YSRMC FSMS	$ 12,195,800 9,848,950 1,509,020 1,000,000 497,642 329,930 150,000 30,000 $ 25,561,342

c. On December 4, 2015 and December 17, 2015, CSCGL, China Shanshui Cement Group (Hong Kong) Company Limited and China Pioneer Cement (Hong Kong) Company Limited (collectively referred as “Shanshui Cement Group”) commenced legal proceedings against former directors of CSCGL in respect of alleged dishonest breaches of fiduciary duty or alleged conspiracy to injure CSCGL during their tenures. The proceedings arose from disputes between CSCGL’s present and former board of directors over the changes in management and the takeover of the headquarters of CSCGL. On April 7, 2016, the Corporation was added as the 10th defendant. The Corporation engaged lawyers to take legal actions in connection with the unqualified claim to defend its reputation and interests. Up to the date of the auditors’ report, the trial was set to take place from April to June in 2021. The Corporation considered it premature to evaluate at this stage the likely outcome of the proceedings and therefore did not recognize any contingent liabilities.
d. Tianrui Group Company Limited and Tianrui (International) Holding Company Limited (collectively referred as “Tianrui Group”), CSI and former directors of CSCGL, in breach of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, the Codes on Takeovers and Mergers and share Buy-backs issued by the Hong Kong Securities and Futures Commission and the fiduciary duties, have engaged in unfair prejudicial conducts in favor of Tianrui directly and indirectly through CSCGL which are detrimental to the interests of the shareholders including the Corporation. The Corporation filed a writ of summons to the High Court of Hong Kong in June 2017 and has been seeking legal advice in relation to the legal proceedings. As the respondents’ applications to strike out the petition for technical reasons, the Corporation amended the applications accordingly. Up to the date
72 -

of the auditors’ report, no decision has been rendered down yet. The Corporation’s appointed attorney has been actively following up on the legal proceedings.

e. On April 17, 2019, CSCGL announced the result of winding-up petition at the news website of the Hong Kong Exchanges and Clearing Limited. According to the announcement, the Court of Appeal of the Cayman Islands declined to grant CSCGL’s application to set aside its decision. As a result, the winding-up petition against CSCGL will be reinstated and returned to the Grand Court of the Cayman Islands. As CSCGL and its legal counsel are considering all available options, the result of the winding-up petition remains uncertain. Considering that CSCGL is a listed company on the Hong Kong Exchanges and Clearing Limited and makes announcements to the public pursuant to the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited, the Corporation did not notice anything unusual in its operation according to its recent announcements. In addition, since no further decision has been rendered down yet, the Corporation considered it premature to evaluate at this stage the likely outcome of the proceedings. Therefore, the Corporation assessed that the winding-up petition did not have any material impact on its investments in CSCGL.

33. SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD

Since the outbreak of the Coronavirus Disease 2019 (COVID-19) epidemic in January 2020, the pandemic caused by the COVID-19 has certain impacts on the business operation and overall economy in different region and industries in the world. The Corporation will stay alert on the development and situation of the COVID-19 and take necessary action to mitigate the business risk.

34. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The significant financial assets and liabilities denominated in foreign currencies were as follows:

December 31, 2019

December 31, 2019
		Foreign		New Taiwan
	Currencies		Exchange Rate		Dollars
Financial assets
Monetary items
RMB	$	193,225	4.29032	$	828,996
USD		124,408	29.93		3,723,523
Non-monetary items
HKD		389,062	3.819		1,485,828
Financial liabilities
Non-monetary items
USD		3,744	29.93		112,070

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December 31, 2018

December 31, 2018
		Foreign		New Taiwan
	Currencies		Exchange Rate		Dollars
Financial assets
Monetary items
RMB	$	189,004	4.46804	$	844,478
USD		105,534	30.665		3,236,187
Non-monetary items
HKD		266,622	3.891		1,037,426
Financial liabilities
Monetary items
USD		8,747	30.665		268,218

For the years ended December 31, 2019 and 2018, the total amounts of realized and unrealized net foreign exchange (losses) gains were ($69,940) thousand and $36,987 thousand, respectively. It is impractical to disclose net foreign exchange gains (losses) by each significant foreign currency because of the variety of the foreign currency transactions and functional currencies of the entities.

35. SEPARATELY DISCLOSED ITEMS

Following are the additional disclosures required by the Securities and Futures Bureau for the Corporation and investees:

a. Financing provided to others: Table 1 (attached).
b. Endorsement/guarantee provided: Table 2 (attached).
c. Marketable securities held (excluding investments in subsidiaries, associates and joint ventures): Table 3 (attached).
d. Marketable securities acquired and disposed of at costs or prices at least $300 million or 20% of the paid-in capital: Table 4 (attached).
e. Acquisition of individual real estate at costs of at least $300 million or 20% of the paid-in capital: None.
f. Disposal of individual real estate at prices of at least $300 million or 20% of the paid-in capital: None.
g. Total purchase from or sale to related parties amounting to at least $100 million or 20% of the paid-in capital: Table 5 (attached).
h. Receivables from related parties amounting to at least $100 million or 20% of the paid-in capital: Table 6 (attached).
i. Names, locations, and related information of investees on which the Corporation exercises significant influence (excluding investee companies in Mainland China): Table 7 (attached).
j. Derivative financial instrument transactions: Note 7.
74 -
k. Information on investments in Mainland China
1) Information on any investee company in mainland China, showing the name, principal business activities, paid-in capital, method of investment, inward and outward remittance of funds, ownership percentage, net income of investees, investment income or loss, carrying amount of the investment at the end of the period, repatriations of investment income, and limit on the amount of investment in the mainland China area. (Table 8)
2) Any of the following significant transactions with investee companies in mainland China, either directly or indirectly through a third party, and their prices, payment terms, and unrealized gains or losses: Table 8.
- a) The amount and percentage of purchases and the balance and percentage of the related payables at the end of the period.
- b) The amount and percentage of sales and the balance and percentage of the related receivables at the end of the period.
- c) The amount of property transactions and the amount of the resultant gains or losses.
- d) The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the end of the period and the purposes.
- e) The highest balance, the end of period balance, the interest rate range, and total current period interest with respect to financing of funds.
- f) Other transactions that have a material effect on the profit or loss for the period or on the financial position, such as the rendering or receiving of services.
75 -

TABLE 1

ASIA CEMENT CORPORATION

FINANCING PROVIDED TO OTHERS YEAR ENDED DECEMBER 31, 2019 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

No.	Lender	Borrower	Financial Statement Account	Related Parties	Highest Balance for the Period	Ending Balance (Note 2)	Actual Borrowing Amount	Interest Rate (Note 3)	Nature of Financing	Business Transaction Amounts	Reasons for Short-term Financing	Allowance for Impairment Loss	Collateral	Collateral	Financing Limit for Each Borrower (Note 1)	Aggregate Financing Limits (Note 1)
													Item	Value
1	ACCHC	FENCC YDES	Other receivables Other receivables	Y Y	RMB431,900 thousand (equivalent to NT$1,852,987 thousand) RMB230,000 thousand (equivalent to NT$986,773 thousand)	- -	- -	- -	Necessary for short-term financing Necessary for short-term financing	$ - -	Operating capital Operating capital	$ - -	- -	$ - -	20% of net worth RMB2,852,760 thousand (equivalent to NT$12,239,242 thousand) Same as above	50% of net worth RMB7,131,901 thousand (equivalent to NT$30,598,109 thousand) Same as above
2	OIHPL	ACCHC	Other receivables	Y	RMB44,000 thousand (equivalent to NT$188,774 thousand)	RMB44,000 thousand (equivalent to NT$188,774 thousand)	RMB44,000 thousand (equivalent to NT$188,774 thousand)	4.14%	Necessary for short-term financing	-	Operating capital	-	-	-	20% of net worth RMB2,443,648 thousand (equivalent to NT$10,484,022 thousand)	50% of net worth RMB6,109,120 thousand (equivalent to NT$26,210,055 thousand)
3	OHC	SIYDCCL SLCL	Other receivables Other receivables	Y Y	RMB200,000 thousand (equivalent to NT$858,063 thousand) RMB350,000 thousand (equivalent to NT$1,501,611 thousand)	RMB200,000 thousand (equivalent to NT$858,063 thousand) RMB350,000 thousand (equivalent to NT$1,501,611 thousand)	- RMB190,000 thousand (equivalent to NT$815,160 thousand)	- 4.09%	Necessary for short-term financing Necessary for short-term financing	- -	Operating capital Operating capital	- -	- -	- -	20% of net worth RMB577,182 thousand (equivalent to NT$2,476,293 thousand) Same as above	50% of net worth RMB1,442,955 thousand (equivalent to NT$6,190,733 thousand) Same as above
4	JYDC	YYDCCL TZOCCL SIYDCCL SLCL SLCCL	Other receivables Other receivables Other receivables Other receivables Other receivables	Y Y Y Y Y	RMB160,000 thousand (equivalent to NT$686,451 thousand) RMB145,000 thousand (equivalent to NT$622,096 thousand) RMB100,000 thousand (equivalent to NT$429,032 thousand) RMB400,000 thousand (equivalent to NT$1,716,126 thousand) RMB35,000 thousand (equivalent to NT$150,161 thousand)	RMB140,000 thousand (equivalent to NT$600,644 thousand) RMB140,000 thousand (equivalent to NT$600,644 thousand) RMB50,000 thousand (equivalent to NT$214,516 thousand) RMB200,000 thousand (equivalent to NT$858,063 thousand) -	- RMB70,000 thousand (equivalent to NT$300,322 thousand) - - -	- 4.09% - - -	Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing	- - - - -	Operating capital Operating capital Operating capital Operating capital Operating capital	- - - - -	- - - - -	- - - - -	20% of net worth RMB1,202,402 thousand (equivalent to NT$5,158,685 thousand) Same as above Same as above Same as above Same as above	50% of net worth RMB3,006,005 thousand (equivalent to NT$12,896,711 thousand) Same as above Same as above Same as above Same as above

(Continued)

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No.	Lender	Borrower	Financial Statement Account	Related Parties	Highest Balance for the Period	Ending Balance (Note 2)	Actual Borrowing Amount	Interest Rate (Note 3)	Nature of Financing	Business Transaction Amounts	Reasons for Short-term Financing	Allowance for Impairment Loss	Collateral	Financing Limit for Each Borrower (Note 1)	Aggregate Financing Limits (Note 1)	No.
		SHYLCP ACCHC	Other receivables Other receivables	Y Y	RMB100,000 thousand (equivalent to NT$429,032 thousand) RMB700,000 thousand (equivalent to NT$3,003,221 thousand)	RMB90,000 thousand (equivalent to NT$386,128 thousand) RMB700,000 thousand (equivalent to NT$3,003,221 thousand)	RMB45,000 thousand (equivalent to NT$193,064 thousand) RMB700,000 thousand (equivalent to NT$3,003,221 thousand)	4.09% 2.94%	Necessary for short-term financing Necessary for short-term financing	$ - -	Operating capital Operating capital	$ - -	- -	$ - -	20% of net worth RMB1,202,402 thousand (equivalent to NT$5,158,685 thousand) Same as above	50% of net worth RMB3,006,005 thousand (equivalent to NT$12,896,711 thousand) Same as above
5	NYDC	SIYDCCL SLCL	Other receivables Other receivables	Y Y	RMB20,000 thousand (equivalent to NT$85,806 thousand) RMB30,000thousand (equivalent to NT$128,709 thousand)	RMB20,000 thousand (equivalent to NT$85,806 thousand) RMB30,000thousand (equivalent to NT$128,709 thousand)	- -	- -	Necessary for short-term financing Necessary for short-term financing	- -	Operating capital Operating capital	- -	- -	- -	20% of net worth RMB33,924 thousand (equivalent to NT$145,545 thousand) Same as above	50% of net worth RMB84,811 thousand (equivalent to NT$363,866 thousand) Same as above
6	HYDCCL	WYXC HXMC WYCPCL SLCL SYCPCL SIYDCCL ACCHC	Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables	Y Y Y Y Y Y Y	RMB60,000 thousand (equivalent to NT$257,419 thousand) RMB40,000 thousand (equivalent to NT$171,613 thousand) RMB35,000 thousand (equivalent to NT$150,161 thousand) RMB150,000 thousand (equivalent to NT$643,547 thousand) RMB50,000 thousand (equivalent to NT$214,516 thousand) RMB80,000 thousand (equivalent to NT$343,225 thousand) RMB400,000 thousand (equivalent to NT$1,716,126 thousand)	RMB20,000 thousand (equivalent to NT$85,806 thousand) RMB24,500 thousand (equivalent to NT$105,113 thousand) RMB20,000 thousand (equivalent to NT$85,806 thousand) RMB100,000 thousand (equivalent to NT$429,032 thousand) RMB20,000 thousand (equivalent to NT$85,806 thousand) - RMB400,000 thousand (equivalent to NT$1,716,126 thousand)	- RMB10,000 thousand (equivalent to NT$42,903 thousand) - - - - RMB400,000 thousand (equivalent to NT$1,716,126 thousand)	- 4.68% - - - - 2.94%	Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing Necessary for short-term financing	- - - - - - -	Operating capital Operating capital Operating capital Operating capital Operating capital Operating capital Operating capital	- - - - - - -	- - - - - - -	- - - - - - -	20% of net worth RMB523,594 thousand (equivalent to NT$2,246,384 thousand) Same as above Same as above Same as above Same as above Same as above Same as above	50% of net worth RMB1,308,985 thousand (equivalent to NT$5,615,959 thousand) Same as above Same as above Same as above Same as above Same as above Same as above
7	WYDC	WYXC WYCPCL	Other receivables Other receivables	Y Y	RMB70,000 thousand (equivalent to NT$300,322 thousand) RMB35,000 thousand (equivalent to NT$150,161 thousand)	RMB70,000 thousand (equivalent to NT$300,322 thousand) RMB25,000 thousand (equivalent to NT$107,258 thousand)	- -	- -	Necessary for short-term financing Necessary for short-term financing	- -	Operating capital Operating capital	- -	- -	- -	20% of net worth RMB121,817 thousand (equivalent to NT$522,633 thousand) Same as above	50% of net worth RMB304,543 thousand (equivalent to NT$1,306,586 thousand) Same as above

(Continued)

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No.	Lender	Borrower	Financial Statement Account	Related Parties	Highest Balance for the Period	Ending Balance (Note 2)	Actual Borrowing Amount	Interest Rate (Note 3)	Nature of Financing	Business Transaction Amounts	Reasons for Short-term Financing	Allowance for Impairment Loss	Collateral	Collateral	Financing Limit for Each Borrower (Note 1)	Aggregate Financing Limits (Note 1)
													Item	Value
		SYCPCL SLCL	Other receivables Other receivables	Y Y	RMB40,000 thousand (equivalent to NT$171,613 thousand) RMB90,000 thousand (equivalent to NT$386,128 thousand)	RMB40,000 thousand (equivalent to NT$171,613 thousand) RMB90,000 thousand (equivalent to NT$386,128 thousand)	RMB40,000 thousand (equivalent to NT$171,613 thousand) -	4.09% -	Necessary for short-term financing Necessary for short-term financing	$ - -	Operating capital Operating capital	$ - -	- -	$ - -	20% of net worth RMB121,817 thousand (equivalent to NT$522,633 thousand) Same as above	50% of net worth RMB304,543 thousand (equivalent to NT$1,306,586 thousand) Same as above
8	CYCPCL	SIYDCCL SLCL	Other receivables Other receivables	Y Y	RMB12,000 thousand (equivalent to NT$51,484 thousand) RMB12,000 thousand (equivalent to NT$51,484 thousand)	RMB12,000 thousand (equivalent to NT$51,484 thousand) RMB12,000 thousand (equivalent to NT$51,484 thousand)	- -	- -	Necessary for short-term financing Necessary for short-term financing	- -	Operating capital Operating capital	- -	- -	- -	20% of net worth RMB16,455 thousand (equivalent to NT$70,597 thousand) Same as above	50% of net worth RMB41,138 thousand (equivalent to NT$176,495 thousand) Same as above
9	HGYDC	SIYDCCL SLCL	Other receivables Other receivables	Y Y	RMB50,000 thousand (equivalent to NT$214,516 thousand) RMB70,000 thousand (equivalent to NT$300,322 thousand)	RMB35,000 thousand (equivalent to NT$150,161 thousand) RMB70,000 thousand (equivalent to NT$300,322 thousand)	- -	- -	Necessary for short-term financing Necessary for short-term financing	- -	Operating capital Operating capital	- -	- -	- -	20% of net worth RMB254,209 thousand (equivalent to NT$1,090,637 thousand) Same as above	50% of net worth RMB635,524 thousand (equivalent to NT$2,726,599 thousand) Same as above
10	NYLC	SIYDCCL SLCL	Other receivables Other receivables	Y Y	RMB16,000 thousand (equivalent to NT$68,645 thousand) RMB16,000 thousand (equivalent to NT$68,645 thousand)	- -	- -	- -	Necessary for short-term financing Necessary for short-term financing	- -	Operating capital Operating capital	- -	- -	- -	20% of net worth RMB32,835 thousand (equivalent to NT$140,873 thousand) Same as above	50% of net worth RMB82,087 thousand (equivalent to NT$352,179 thousand) Same as above
11	SLCL	SLCCL	Other receivables	Y	RMB40,000 thousand (equivalent to NT$171,613 thousand)	RMB40,000 thousand (equivalent to NT$171,613 thousand)	RMB33,000 thousand (equivalent to NT$141,580 thousand)	4.09%	Necessary for short-term financing	-	Operating capital	-	-	-	20% of net worth RMB300,846 thousand (equivalent to NT$1,290,724 thousand)	50% of net worth RMB752,116 thousand (equivalent to NT$3,226,815 thousand)

Note 1: The net value was calculated based on audited financial statements as of December 31, 2019.

Note 2: The ending balance is the financing credit lines to the respective borrowers approved by the board of directors of lenders.

Note 3: The interest rate was for the year ended December 31, 2019.

Note 4: The foreign currency amounts are expressed in New Taiwan dollars at exchange rate as of December 31, 2019.

(Concluded)

78 -

TABLE 2

ASIA CEMENT CORPORATION

ENDORSEMENTS/GUARANTEES PROVIDED YEAR ENDED DECEMBER 31, 2019 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

No.	Endorser/ Guarantor	Endorsee/Guarantee	Endorsee/Guarantee	Limits on Each Endorsement/ Guarantee Given on Behalf of Each Party (Note 1)	Maximum Amount Endorsed/ Guaranteed During the Period	Outstanding Endorsement/ Guarantee at the End of the Period	Actual Borrowing Amount	Amount Endorsed/ Guaranteed by Collaterals	Ratio of Accumulated Endorsement/ Guarantee to Net Equity in Latest Financial Statements (%)	Aggregate Endorsement/ Guarantee Limit (Note 1)	Endorsement/ Guarantee Given by Parent on Behalf of Subsidiaries	Endorsement/ Guarantee Given by Subsidiaries on Behalf of Parent	Endorsement/ Guarantee Given on Behalf of Companies in Mainland China
		Name	Relationship (Note 3)
0	The Corporation	AIC DCI FSMS NHC AEE YLPPC YSRMC YTRMC	b b b b b b b b	50% of net worth ($73,033,679 thousand) Same as above Same as above Same as above Same as above Same as above Same as above Same as above	$ 12,227,000 9,856,750 30,000 1,516,300 422,880 497,642 150,000 1,000,000	$ 12,195,800 9,848,950 30,000 1,509,020 329,930 497,642 150,000 1,000,000	$ 6,890,000 4,952,000 30,000 420,000 150,000 137,757 - -	None None None None None None None None	8.35 6.74 0.02 1.03 0.23 0.34 0.10 0.68	100% of net worth ($146,067,358 thousand) Same as above Same as above Same as above Same as above Same as above Same as above Same as above	Y Y Y Y Y Y Y Y	- - - - - - - -	- - - - - - - -
1	DCI	FSMS	b	50% of net worth ($6,828,783 thousand)	50,000	50,000	10,000	None	0.37	100% of net worth ($13,657,566 thousand)	Y	-	-
2	AOG	AOC	b	50% of net worth (US$1,146 thousand) (equivalent to NT$34,305 thousand)	15,775	14,965	-	None	21.81	100% of net worth (US$2,292 thousand) (equivalent to NT$68,610 thousand)	Y	-	-
3	YLSS	YLSS	-	50% of net worth ($902,155 thousand)	100,000	100,000	30,000	100,000	5.54	100% of net worth ($1,804,309 thousand)	-	-	-
4	YTRMC	AOC	b	50% of net worth ($900,885 thousand)	15,775	14,965	-	None	0.83	100% of net worth ($1,801,770 thousand)	Y	-	-

Note 1: The net value was calculated based on audited financial statements as of December 31, 2019.

Note 2: The foreign currency amounts are expressed in New Taiwan dollars at exchange rate as of December 31, 2019.

Note 3: The relationship between guarantor and guarantee are as follows:

a. Firms that do business with the Corporation.
b. Firms of which the Corporation holds, directly or indirectly, over 50% of the voting shares.
79 -

TABLE 3

ASIA CEMENT CORPORATION

MARKETABLE SECURITIES HELD DECEMBER 31, 2019 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account		December 31, 2019	December 31, 2019		Note
				Shares or Units	Carrying Amount	Percentage of Ownership (%)	Fair Value
The Corporation DCI	Beneficiary certificates Deutsche Far Eastern DWS Taiwan Flagship Security Investment Trust Fund Ordinary shares China Conch Venture Holding Far EasTone Far Eastern Department Stores Ltd. Oriental Union Chemical Corp. CHC Resources Corporation Far Eastern International Bank Kaohsiung Rapid Transit Taiwan Stock Exchange Corp. Ding Ding Hotel Corp. L’ Hotel de Chine Hotel China Trade & Development Corp. Pan Asia Engineers & Constructors Corp. Linkou Recreation Corporation China Shanshui Investment Corp Beneficiary certificates Polaris Taiwan Top 50 Tracker Fund Mega Target Return Strategy Fund of ETF Funds ChinaAMC CSI 300 Index ETF Opas Fund Segregated Portfolio Tranche A Ordinary shares Industrial and Commercial Bank of China, A share China Mobile Communications Corporation Haitong Securities Co., Ltd. Taiwan Cement Co., Ltd. Hsing Ta Cement Co., Ltd. Chunghwa Picture Tubes, Ltd. Innolux Corporation Pegatron Corporation Tong Yang Industry Co., Ltd E Ink Holdings corporation Hiwin Technologies Corporation Accton Technology Corporation Casetek Holdings Limited China Life Insurance Company Limited, H share	- - The same chairman The same chairman The same chairman The Corporation is its director The chairman of the Corporation is its vice-chairman - - Related party in substance - - The Corporation is its director - - - - - Related party in substance - - - - - - - - - - - - - -	Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - noncurrent Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Financial assets at fair value through profit or loss - current Same as above Same as above Same as above Financial assets at fair value through profit or loss - current Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Financial assets at fair value through other comprehensive income - current Same as above	10,000,000 11,443,000 31,034,372 80,052,950 63,766,522 22,801,185 78,878,582 15,873,243 8,430,368 555,638 598,121 250,003 1,551,395 5 49,928 400,000 1,000,811 540,000 8,000 2,000,000 210,000 1,800,000 8,796,722 6,504,854 275,223 9,200,000 1,242,000 1,732,000 1,130,000 60,000 150,000 1,050,000 607,000	$ 204,700 1,485,828 2,237,578 2,085,379 1,339,097 1,146,900 942,599 78,630 466,199 5,340 14,469 3,902 17,919 - 488,258 38,780 10,620 95,689 273,741 50,454 52,530 63,311 384,417 130,748 - 76,636 84,953 80,798 35,313 16,860 25,200 49,718 50,188	- 0.63 0.95 5.65 7.20 9.17 2.35 5.70 1.16 0.53 0.31 0.38 1.36 0.50 4.99 - - 0.20 - - - 0.02 0.16 1.90 - 0.09 0.05 0.29 0.10 0.02 0.03 0.25 -	$ 204,700 1,485,828 2,237,578 2,085,379 1,339,097 1,146,900 942,599 78,630 466,199 5,340 14,469 3,902 17,919 - 488,258 38,780 10,620 95,689 273,741 50,454 52,530 63,311 384,417 130,748 - 76,636 84,953 80,798 35,313 16,860 25,200 49,718 50,188	Note 4

(Continued)

80 -

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account		December 31, 2019	December 31, 2019		Note
				Shares or Units	Carrying Amount	Percentage of Ownership (%)	Fair Value
NHC YTRMC FMT FDT AEE YLPPC AIC	Far Eastern International Bank Oriental Union Chemical Corp. Far EasTone Mega Financial Holding Co., Ltd. Lite-On Technology Corporation Tripod Technology Corporation WPG Holdings Limited Far Eastern International Bank Far Eastern Department Stores Ltd. Oriental Union Chemical Corp. CHC Resources Corporation Picvue Electronics Co., Ltd. Ding Ding Hotel Corp. Far Eastern International Leasing Corporation Ordinary shares Far EasTone Ordinary shares Far EasTone Ordinary shares Everest Textile Co., Ltd. Oriental Union Chemical Corp. Far Eastern Department Store Ltd. Yi Tong Fiber Co., Ltd. Ordinary shares Far Eastern International Bank Far Eastern Department Store Ltd. Oriental Union Chemical Corp. Ding & Ding Management Consultants Co., Ltd. Ordinary shares Far EasTone Ding & Ding Management Consultants Co., Ltd. Ordinary shares Far EasTone Yamay International Development Corp. Beneficiary certificates Opas Fund Segregated Portfolio Tranche E ChinaAMC CSI 300 Index ETF	The chairman of the Corporation’s major shareholder is its vice-chairman Same chairman with the major shareholder Same chairman with the major shareholder - - - - The chairman of the Corporation’s major shareholder is its vice-chairman The same chairman The same chairman The Corporation is its director - Same chairman with the major shareholder The Corporation is its director Same chairman with the major shareholder Same chairman with the major shareholder The chairman of the Corporation is its chairman The chairman of the Corporation is its director Same chairman with the major shareholder - The chairman of the Corporation is its vice-chairman by the ultimate parent company The chairman of the Corporation is its vice-chairman Same chairman with the ultimate parent company - Same chairman with the major shareholder - The director of the Corporation is its chairman - Related party in substance -	Financial assets at fair value through other comprehensive income - current Same as above Same as above Same as above Same as above Same as above Same as above Financial assets at fair value through other comprehensive income - noncurrent Same as above Same as above Same as above Same as above Same as above Same as above Financial assets at fair value through profit or loss - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - noncurrent Same as above Same as above Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - noncurrent Same as above Same as above Financial assets at fair value through profit or loss - current Financial assets at fair value through other comprehensive income - noncurrent Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - noncurrent Financial assets at fair value through profit or loss - current Same as above	37,693,157 41,246 215,000 9,958,000 299,000 261,000 340,000 97,439,707 13,630,966 10,506,792 4,812,514 161,700 213,442 45,258,938 50,000 230,000 13,279,219 2,256,782 1,185,713 5,256,454 296,017 935,029 3,254,125 866,730 120,000 273,024 105,000 15 3,973 1,000,000	$ 450,433 866 15,502 304,715 14,756 32,756 13,294 1,164,404 355,087 220,643 242,069 - 2,051 602,813 3,605 16,583 121,372 47,392 30,888 41,691 3,537 24,358 68,337 8,376 8,652 900 7,571 - 156,299 177,202	1.12 - 0.01 0.07 0.01 0.05 0.02 2.90 0.96 1.19 1.94 0.06 0.21 10.14 - - 2.60 0.25 0.08 5.94 0.01 0.07 0.37 16.00 - 5.04 - - - 0.37	$ 450,433 866 15,502 304,715 14,756 32,756 13,294 1,164,404 355,087 220,643 242,069 - 2,051 602,813 3,605 16,583 121,372 47,392 30,888 41,691 3,537 24,358 68,337 8,376 8,652 900 7,571 - 156,299 177,202	Note 5

(Continued)

81 -

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account		December 31, 2019	December 31, 2019		Note
				Shares or Units	Carrying Amount	Percentage of Ownership (%)	Fair Value
Asia Cement Pioneer Investment Ltd. FSMS YLT YLSS KCC KCCL	Ordinary shares Hsing Ta Cement Co., Ltd Foxconn Technology Co., Ltd Taiwan Cement Co., Ltd. Quanta Computer Inc. Pegatron Corporation Hon Hai Precision Industry Co., Ltd. China Construction Bank Corporation, A share China Life Insurance Company Limited, H share China Mobile Communications Corporation Hiwin Technologies Corporation Accton Technology Corporation Far EasTone Casetek Holdings Limited Nan Ya Plastics Corporation Inventec Corporation China Life Insurance Company Limited, A share China Life Insurance Company Limited, H share Lite-On Technology Corporation Tripod Technology Corporation WPG Holdings Limited Far Eastern International Bank Oriental Union Chemical Corp. Far Eastern Department Store Ltd. Ding Shen Investment Co., Ltd. Hsin Nsn Construction Co., Ltd. Ordinary shares Cementon Micronesia L.L.C. Ordinary shares Stone Industry Resource System Corp Beneficiary certificates Polaris Taiwan Top 50 Tracker Fund Ordinary shares Far Eastern International Bank Far EasTone Ordinary shares Far EasTone Beneficiary certificates CSOP FTSE China A50 ETF Beneficiary certificates Allianz US High Yield Fund Opas Fund Segregated Portfolio Tranche C	- - - - - - - - - - - Same chairman with the major shareholder - - - - - - - - The chairman of the Corporation’s major shareholder is its vice-chairman Same chairman with the major shareholder Same chairman with the major shareholder The Corporation is its director - - - - The chairman of the Corporation’s major shareholder is its vice-chairman Same chairman with the major shareholder Same chairman with the major shareholder - - Related party in substance	Financial assets at fair value through profit or loss - current Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Financial assets at fair value through other comprehensive income - current Same as above Same as above Same as above Same as above Same as above Same as above Same as above Same as above Financial assets at fair value through other comprehensive income - noncurrent Same as above Same as above Same as above Same as above Financial assets at fair value through other comprehensive income - noncurrent Financial assets at fair value through other comprehensive income - noncurrent Financial assets at fair value through profit or loss - current Financial assets at fair value through other comprehensive income - noncurrent Same as above Financial assets at fair value through other comprehensive income - current Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current Same as above	10,834,650 2,043,000 389,519 525,000 825,000 1,720,000 2,500,000 1,350,000 448,000 38,000 150,000 1,426,303 1,000,000 3,286,000 2,882,000 540,000 986,000 136,000 100,000 340,000 135,149,123 1,552,156 4,473,972 39,600,000 2,696 (Note 1) 10,000 350,000 3,020,872 71,099 130,000 300,000 97,741 1,606	$ 217,776 135,247 17,022 33,758 56,430 156,176 77,548 111,620 112,065 10,678 25,200 102,836 47,350 239,221 65,854 80,786 81,524 6,712 12,550 13,294 1,615,032 32,595 116,547 372,240 - 116,727 70 33,933 36,099 5,126 9,373 17,438 21,147 70,827	3.17 0.14 0.01 0.01 0.03 0.01 - - - 0.01 0.03 0.04 0.24 0.04 0.08 - - 0.01 0.02 0.02 4.03 0.18 0.32 18.00 - 10.00 0.15 - 0.09 - - - - -	$ 217,776 135,247 17,022 33,758 56,430 156,176 77,548 111,620 112,065 10,678 25,200 102,836 47,350 239,221 65,854 80,786 81,524 6,712 12,550 13,294 1,615,032 32,595 116,547 372,240 - 116,727 70 33,933 36,099 5,126 9,373 17,438 21,147 70,827	Note 6

(Continued)

82 -

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account		December 31, 2019	December 31, 2019		Note
				Shares or Units	Carrying Amount	Percentage of Ownership (%)	Fair Value
ACSPL OCPL	Beneficiary certificates United Emerging Markets Bond Funds United Growth Fund Ordinary shares DBS Group Guocoland Ltd. Hong Leong Asia INTRACO Engro Corp Ltd. Ordinary shares Hiap Hoe Ltd.	- - - - - - - -	Financial assets at fair value through profit or loss - current Same as above Financial assets at fair value through profit or loss - current Same as above Same as above Same as above Same as above Financial assets at fair value through profit or loss - current	3,232,758 745,068 33,436 26,666 20,000 46,875 2,000 44,260	$ 93,112 60,131 19,202 1,160 297 296 43 786	- - - - - - - -	$ 93,112 60,131 19,202 1,160 297 296 43 786

Note 1: This is not a company limited by shares.

Note 2: Marketable securities in this table are shares, bonds, beneficiary certificates and securities derived from these items under IFRS 9 “Financial Instruments: Recognition and Measurement”.

Note 4: 14,500 thousand shares ($1,045,450 thousand) of the securities are pledged as collaterals for bank loans of the Corporation.

Note 5: 5,000 thousand shares ($130,250 thousand) of the securities are pledged as collaterals for bank loans of DCI.

Note 6: 3,500 thousand shares ($91,175 thousand) of the securities are pledged as collaterals for bank loans of AIC.

(Concluded)

83 -

TABLE 4

ASIA CEMENT CORPORATION

MARKETABLE SECURITIES ACQUIRED AND DISPOSED OF AT COSTS OR PRICES OF AT LEAST NT$300 MILLION OR 20% OF THE PAID-IN CAPITAL YEAR ENDED DECEMBER 31, 2019

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Company Name	Type and Name of Marketable Securities (Note 1)	Financial Statement Account	Counterparty (Note 2)	Relationship (Note 2)	Beginning Balance	Beginning Balance	Acquisition (Note 3)	Acquisition (Note 3)		Disposal (Note 3)	Disposal (Note 3)		Ending	Balance
					Shares/Units	Amount	Shares/Units	Amount	Shares/Units	Amount	Carrying Value	Gain (Loss) on Disposal	Shares/Units	Amount
ACCHC PIHPL OIH OHC ACSPL DCI AIC Mega Mega IV Leap	Ordinary shares PIHPL Ordinary shares OIH Ordinary shares OHC Ordinary shares YDES Beneficiary certificates Opas Fund Segregated Portfolio Tranche D Beneficiary certificates Opas Fund Segregated Portfolio Tranche D Beneficiary certificates Opas Fund Segregated Portfolio Tranche D Beneficiary certificates Opas Fund Segregated Portfolio Tranche D Beneficiary certificates Opas Fund Segregated Portfolio Tranche D Beneficiary certificates Opas Fund Segregated Portfolio Tranche D	Investments in subsidiaries Investments in subsidiaries Investments in subsidiaries Investments accounted for using the equity method Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current	Proceeds from issuance of ordinary shares Proceeds from issuance of ordinary shares Proceeds from issuance of ordinary shares Proceeds from issuance of ordinary shares - - - - - -	Subsidiaries Subsidiaries Subsidiaries Associates - - - - - -	9,379,303 700,709,352 (Note 1) (Note 1) 19,000 56,000 58,000 - - -	US 2,165,969 thousand US 1,473,705 thousand RMB 813,357 thousand - 580,194 1,716,669 1,777,798 - - -	340,232 (Note 2) - - - 94 - 9,601 9,601 9,601	US 73,781 thousand US 73,781 thousand RMB 500,000 thousand RMB 714,190 Thousand - 2,869 - 294,286 294,286 294,286	- - - - 19,000 56,094 58,000 9,601 9,601 9,601	$ - - - - 612,797 1,805,004 1,863,752 296,073 296,073 296,073	$ - - - - 583,562 1,716,469 1,774,800 294,286 294,286 294,286	$ - - - - 29,235 88,536 88,952 1,787 1,787 1,787	9,719,535 (Note 2) 700,709,352 (Note 2) (Note 1) (Note 1) - - - - - -	US 2,484,649 thousand US 1,751,418 thousand RMB 2,885,909 thousand RMB 706,643 thousand - - - - - -

Note 1: This is not a company limited by shares.

Note 2: The cash capital increment was not registered yet.

84 -

TABLE 5

ASIA CEMENT CORPORATION

TOTAL PURCHASE FROM OR SALE TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL YEAR ENDED DECEMBER 31, 2019

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Purchasing or (Selling) Company Name	Related Party	Relationship		Transaction Details	Transaction Details	Transaction Details	Abnormal Transaction	Abnormal Transaction	Notes/Accounts (Payable) or Receivable	Notes/Accounts (Payable) or Receivable	Note
			Purchase (Sale)	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
The Corporation ACSPL YTRMC FMT FDT YSRMC YLPPC NHC YLT YTV JYDC	YTRMC ACSPL YSRMC U-Ming U-Ming Singapore YLT NHC Alliance Concrete Singapore Pte. Ltd. The Corporation Far Eastern General Construction Inc. Far Eastern Resources Development Co. The Corporation CHC Resources Corporation Air Liquide Far Eastern Co. FENC OUCC Oriental Petrochemical (Taiwan) Co., Ltd. Chubei New Century Shopping Mall Co., Ltd. The Corporation Far Eastern General Construction Inc. The Corporation The Corporation Far Eastern Polytex Vietnam Ltd. TZOCCL WYDC YYDCCL NYDC	A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation An investee accounted for by equity method A subsidiary of an investee accounted for by equity method A subsidiary of the Corporation A subsidiary of the Corporation An investee accounted for by equity method Parent company Related party in substance Related party in substance Parent company Related party in substance Related party in substance An investee accounted for by equity method Related party in substance Related party in substance Related party in substance Parent company Related party in substance Parent company Parent company A subsidiary of an investee accounted for by equity method The same ultimate parent company The same ultimate parent company The same ultimate parent company A subsidiary of the Corporation	Sales Sales Sales Sales freight expense Sales freight expense Sales freight expense Purchase Sales Purchase Sales Sales Purchase Purchase Sales Sales Sales Sales Sales Purchase Sales Sales Sales Sales Sales Sales Sales Sales	$ (1,805,262) (522,223) (163,476) 551,952 186,958 176,539 151,293 SGD (28,215) thousand SGD 23,042 thousand (430,434) (104,551) 1,805,262 466,075 (156,034) (207,509) (133,627) (176,300) (104,908) 163,476 (116,783) (151,293) (176,539) VND (79,774,106) thousand RMB (240,626) thousand RMB (212,481) thousand RMB (552,419) thousand RMB (92,202) thousand	(20) (6) (2) 6 2 2 2 (78) 63 (5) (1) 21 5 (14) (19) (12) (20) (15) 25 (66) (40) (98) (82) (5) (4) (11) (2)	Purchase 45 days after monthly closing Average 30 days Purchase 45 days after monthly closing Average 60 days Average 10 days Average 30 days Purchase 45 days after monthly closing Average 60 days Average 30 days Average 90 days Average 90 days Purchase 45 days after monthly closing Purchase 45 days after monthly closing Purchase 120 days after monthly closing Purchase 60 days after monthly closing Purchase 75 days after monthly closing 110 days Average 60 days Purchase 45 days after monthly closing Average 90 days Purchase 45 days after monthly closing 30 days Within 45 days Within 90 days Average 30 days Within 90 days Average 30 days	$ - - - - - - - - - - - - - - - - - - - - - - - - - - -	- - - - - - - - - - - - - - - - - - - - - - - - - - -	$ 348,664 38,621 34,114 (66,176) - (31,883) (28,431) SGD 6,247 thousand SGD (1,740) thousand 213,416 76,481 (348,664) (64,488) 52,734 27,527 23,895 55,066 19,648 (34,114) 35,542 28,431 31,883 VND 26,936,744 thousand RMB 34,873 thousand RMB 37,902 thousand RMB 31,765 thousand RMB 16,285 thousand	33 4 3 (4) - (2) (2) 83 (28) 6 2 (24) (4) 25 13 11 46 8 (30) 34 33 99 87 4 5 4 2

(Continued)

85 -

Purchasing or (Selling) Company Name	Related Party	Relationship		Transaction Details	Transaction Details	Transaction Details	Abnormal Transaction	Abnormal Transaction	Notes/Accounts (Payable) or Receivable	Notes/Accounts (Payable) or Receivable	Note
			Purchase (Sale)	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
NYDC NYLC TZOCCL WYDC YYDCCL HYDCCL	NYLC HYDCCL RYNM JYLTC WAMTC NYDC NYLC HGYDC JYDC JYDC JYDC JYDC JYDC YYDCCL JYDC HYDCCL TZOCCL JYDC WAMTC WYDC WYCPCL HZYCCL JYDC HGYDC WAMTC HXMC	A subsidiary of the Corporation The same ultimate parent company A subsidiary of the Corporation A subsidiary of the Corporation An investee accounted for by equity method A subsidiary of the Corporation A subsidiary of the Corporation The same ultimate parent company Parent company Parent company Parent company Parent company The same ultimate parent company The same ultimate parent company The same ultimate parent company The same ultimate parent company The same ultimate parent company The same ultimate parent company An investee accounted for by equity method The same ultimate parent company The same ultimate parent company An investee accounted for by equity method The same ultimate parent company The same ultimate parent company An investee accounted for by equity method An investee accounted for by equity method	Sales Sales Sales Sales freight expense Sales freight expense Purchase Purchase Purchase Sales Purchase Sales Purchase Purchase Purchase Purchase Purchase Sales Purchase Sales freight expense Sales Sales Sales Purchase Purchase Sales freight expense Purchase	RMB (33,435) thousand RMB (49,612) thousand RMB (23,366) thousand RMB 52,041 thousand RMB 76,408 thousand RMB 294,343 thousand RMB 28,776 thousand RMB 24,880 thousand RMB (294,343) thousand RMB 92,202 thousand RMB (28,776) thousand RMB 33,435 thousand RMB 240,626 thousand RMB 29,860 thousand RMB 212,481 thousand RMB 25,704 thousand RMB (29,860) thousand RMB 552,419 thousand RMB 25,879 thousand RMB (25,704) thousand RMB (44,639) thousand RMB (32,231) thousand RMB 49,612 thousand RMB 86,691 thousand RMB 33,759 thousand RMB 22,650 thousand	(1) (1) - 2 2 10 1 1 (100) 35 (17) 23 85 11 63 8 (3) 70 3 (2) (3) (2) 5 8 3 2	Average 30 days Within 90 days Average 30 days Within 90 days Within 90 days Average 30 days Average 30 days Average 30 days Average 30 days Average 30 days Average 30 days Average 30 days Within 90 days Within 90 days Average 30 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days Within 90 days	$ - - - - - - - - - - - - - - - - - - - - - - - - - -	- - - - - - - - - - - - - - - - - - - - - - - - - -	RMB 6,503 thousand RMB 12,304 thousand RMB 3,856 thousand RMB (14,608) thousand RMB (19,484) thousand RMB (45,705) thousand RMB (2,475) thousand RMB (7,370) thousand RMB 45,705 thousand RMB (16,285) thousand RMB 2,475 thousand RMB (6,503) thousand RMB (34,873) thousand RMB (912) thousand RMB (37,902) thousand RMB (280) thousand RMB 912 thousand RMB (31,765) Thousand RMB (2,885) thousand RMB 280 thousand RMB 14,085 thousand RMB 14,906 thousand RMB (12,304) thousand RMB (9,658) thousand - RMB (1,856) thousand	1 1 - (8) 11 (25) (1) (4) 100 (58) 2 (31) (92) (2) (59) - 1 (64) (6) - 4 4 (14) (11) - (2)

(Continued)

86 -

Purchasing or (Selling) Company Name	Related Party	Relationship		Transaction Details	Transaction Details	Transaction Details	Abnormal Transaction	Abnormal Transaction	Notes/Accounts (Payable) or Receivable	Notes/Accounts (Payable) or Receivable	Note
			Purchase (Sale)	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
WYCPCL SIYDCCL HGYDC SLCL SYCPCL JYLTC SYTCL RYNM	HYDCCL SLCL SYCPCL HYDCCL JYDC SYCPCL SIYDCCL SYTCL SLCL SIYDCCL JYDC SLCL JYDC	The same ultimate parent company A subsidiary of the Corporation The same ultimate parent company The same ultimate parent company The same ultimate parent company The same ultimate parent company Parent company The same ultimate parent company The same ultimate parent company The same ultimate parent company Parent company The same ultimate parent company Parent company	Purchase Sales Sales Sales Sales Sales Purchase Purchase Purchase Purchase Sales Sales Purchase	RMB 44,639 thousand RMB (81,058) thousand RMB (27,616) thousand RMB (86,691) Thousand RMB (24,880) thousand RMB (23,395) thousand RMB 81,058 thousand RMB 43,424 Thousand RMB 23,395 Thousand RMB 27,616 Thousand RMB (52,041) thousand RMB (43,424) thousand RMB 23,366 thousand	30 (4) (1) (10) (3) (2) 10 5 9 11 (63) (56) 100	Within 90 days Within 90 days Within 90 days Within 90 days Average 30 days Within 90 days Within 90 days Within 90 days Average 30 days Within 90 days Within 90 days Within 90 days Average 30 days	$ - - - - - - - - - - - - -	- - - - - - - - - - - - -	RMB (14,085) thousand RMB 7,306 thousand RMB 8,710 thousand RMB 9,658 thousand RMB 7,370 thousand RMB 22,603 thousand RMB (7,306) thousand RMB (6,162) thousand RMB (22,603) thousand RMB (8,710) thousand RMB 14,608 thousand RMB 6,162 thousand RMB (3,856) thousand	(43) 1 1 18 14 3 (15) (12) (24) (9) 62 24 (99)

(Concluded)

87 -

TABLE 6

ASIA CEMENT CORPORATION

RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL YEAR ENDED DECEMBER 31, 2019

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Company Name	Related Party	Relationship	Ending Balance	Turnover Rate	Overdue	Overdue	Amounts Received in Subsequent Period	Allowance for Impairment Loss
					Amount	Action Taken
The Corporation ACSPL YTRMC JYDC NYDC OIH OHC SLCL WYDC HYDCCL	YTRMC Alliance Concrete Singapore Pte. Ltd. Far Eastern General Construction Inc. TZDC WYDC YYDCCL ACCHC SHYLCP TZOCCL JYDC ACCHC SLCL SLCCL SYCPCL ACCHC	A subsidiary of the Corporation An investee accounted for by equity method Related party in substance The same ultimate parent company The same ultimate parent company The same ultimate parent company Parent company The same ultimate parent company The same ultimate parent company Parent company Parent company The same ultimate parent company A subsidiary of the Corporation The same ultimate parent company Parent company	$ 348,664 SGD 6,247 thousand 213,416 RMB 34,873 thousand RMB 37,902 thousand RMB 31,765 thousand RMB 700,000 thousand RMB 45,000 thousand RMB 70,000 thousand RMB 45,705 thousand RMB 44,000 thousand RMB 190,000 thousand RMB 33,000 thousand RMB 40,000 thousand RMB 400,000 thousand	5.02 times 4.25 times 1.75 times 6.92 times 6.71 times 16.52 times Note 1 Note 1 Note 1 6.77 times Note 1 Note 1 Note 1 Note 1 Note 1	$ - - - - - - - - - - - - - - -	- - - - - - - - - - - - - - -	$ 5,386 SGD 6,247 thousand 121,620 RMB 30,032 thousand - RMB 23,692 thousand - - - RMB 45,705 thousand - RMB 90,000 thousand - - -	$ - - - - - - - - - - - - - - -

Note 1: The accounts receivable from financing.

88 -

TABLE 7

ASIA CEMENT CORPORATION

NAMES, LOCATIONS, AND OTHER INFORMATION OF INVESTEES ON WHICH THE CORPORATION EXERCISES SIGNIFICANT INFLUENCE (EXCLUDING INVESTMENT IN MAINLAND CHINA) YEAR ENDED DECEMBER 31, 2019

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Investor Company	Investee Company	Location	Main Businesses and Products	Investment Amount	Investment Amount	Balance	as of December 31, 2019	as of December 31, 2019	Net Income (Loss) of the Investee	Share of Profits (Loss)	Note
				December 31, 2019	December 31, 2018	Shares	Percentage of Ownership	Carrying Value
The Corporation DCI	ACCHC FENC U-Ming DCI CHP YDC YYI ACSPL OSC AIC YTRMC YLSS FMT FEDSDL NHC YDLC YLT AEE EISF YLPPC SIHL CSCGL YDC FEC FENC KCC SHSTC FSMS U-Ming AC Mega Investment Ltd. AC Leap Investment Ltd. AC Mega II Investment Ltd.	Cayman Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Singapore Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan B.V.I. Cayman Taiwan Taiwan Taiwan Hong Kong Taiwan Taiwan Taiwan B.V.I. B.V.I. B.V.I.	Investment Textile Marine transportation Investment Power plant Investment Investment Cement Broker Investment Ready-mixed concrete, cement - related products Stainless steel Transportation Retails Cement, granulated blast-furnace slag Leasing Transportation Engineering Iron and steel Cement - related products Investment Investment Investment Construction Textile Cement Storage and transportation Mining excavation, mineral processing and sales Marine transportation Investment Investment Investment	$ 13,660,636 3,459,787 510,236 2,555,255 3,119,492 2,232,220 911,058 186,958 154,207 1,212,679 1,042,252 2,661,240 68,416 500,000 410,994 309,049 22,110 5,136 31,463 144,961 2,898 4,821,008 289,982 140,138 1,263,385 36,024 - 112,096 27,619 828,313 846,224 289,050	$ 13,660,636 3,459,787 510,236 2,555,255 3,119,492 2,232,220 911,058 186,958 154,207 1,212,679 1,042,252 2,661,240 68,416 500,000 410,994 309,049 22,110 5,136 31,463 144,961 2,898 4,821,008 289,982 140,138 1,263,385 36,024 143,516 112,096 27,619 579,926 579,439 289,050	1,061,209,202 1,272,277,085 331,701,152 595,576,603 280,093,521 178,707,648 155,000,803 10,495,495 135,092,154 222,039,596 159,067,779 200,000,000 29,517,188 53,250,000 26,128,171 34,640,189 5,100,000 7,970,703 3,199,823 16,241,083 90,000 331,878,315 72,989,090 115,882,928 82,812,887 1,127,000 - 1,294,270 468,486 27,700,000 28,300,000 10,000,000	67.73 23.77 39.25 99.99 59.59 35.50 29.92 99.96 18.93 100.00 99.99 100.00 99.82 25.00 99.94 43.60 51.00 98.23 40.40 83.81 100.00 7.62 14.50 33.76 1.55 49.00 - 99.56 0.06 100.00 100.00 100.00	$ 41,411,828 39,074,139 10,462,271 13,656,200 6,059,603 3,218,379 2,560,533 4,142,011 1,921,049 3,256,199 1,801,770 1,969,817 1,410,458 640,867 261,372 373,481 265,154 182,274 80,652 75,594 54,922 5,248,933 1,320,548 4,402,354 2,509,521 446,154 - 133,735 30,967 774,004 855,589 281,337	$ 14,106,889 10,732,669 1,621,695 1,262,905 1,097,061 214,541 811,808 693,709 250,003 977,016 146,801 1,347 213,189 152,284 52,531 12,144 22,796 59,946 14,020 1,040 3,038 13,578,105 214,541 725,256 10,732,669 40,881 - (6,936) 1,621,695 86,138 100,918 46,877	$ 9,554,596 1,637,898 636,545 1,262,788 653,769 67,561 242,893 693,431 47,326 977,016 146,801 (6,939) 213,363 56,887 52,499 5,295 11,626 58,885 5,664 871 3,038 965,182 Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable	A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation

(Continued)

89 -

Investor Company	Investee Company	Location	Main Businesses and Products	Investment Amount	Investment Amount	Balance	as of December 31, 2019	as of December 31, 2019	Net Income (Loss) of the Investee	Share of Profits (Loss)	Note
				December 31, 2019	December 31, 2018	Shares	Percentage of Ownership	Carrying Value
NHC YTRMC FMT FDT AEE YLPPC AIC	AC Mega III Investment Ltd. AC Mega IV Investment Ltd. Drive Catalyst SPC - SP Tranche One Drive Catalyst SPC - SP Tranche Three CSCGL SHSTC PGIC FENC U-Ming CSCGL YSRMC YTV PYCI AOG FDT FENC YDEC U-Ming FENC ACCHC U-Ming CSCGL YDEC PYCI YLPCIP AOG FENC U-Ming CHP Asia Cement Pioneer Investment Ltd. Asia Cement Pioneer II Investment Ltd. Asia Cement Pioneer III Investment Ltd. Asia Cement Pioneer IV Investment Ltd. Asia Cement Explorer Investment Ltd. DCI	B.V.I. B.V.I. B.V.I. B.V.I. Cayman Taiwan Taiwan Taiwan Taiwan Cayman Taiwan Vietnam Indonesia Guam Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Cayman Taiwan Cayman Taiwan Indonesia India Guam Taiwan Taiwan Taiwan B.V.I. B.V.I. B.V.I. B.V.I. B.V.I. Taiwan	Investment Investment Investment Investment Investment Storage and transportation Granulated blast-furnace slag Textile Marine transportation Investment Ready-mixed concrete Ready-mixed concrete Ready-mixed concrete Investment Transportation Textile Retail Marine transportation Textile Investment Marine transportation Investment Retail Ready-mixed concrete Tunnel lining segments Investment Textile Marine transportation Power plant Investment Investment Investment Investment Investment Investment	$ 289,050 780,510 123,120 123,960 872,619 - 36,771 15,240 1,027 282,957 69,930 201,823 144,369 236,240 30,373 40,263 160,424 1,891 31,322 50,541 38,931 266,942 20,776 1,448 8,338 66,816 405,473 77,446 376 2,100,779 833,410 578,325 575,538 623,340 76	$ 289,050 780,510 123,120 - 872,619 333,309 36,771 15,240 1,027 282,957 69,930 201,823 61,439 175,230 30,373 40,263 160,424 1,891 31,322 50,541 38,931 266,942 20,776 621 8,338 66,816 405,473 77,446 376 2,039,879 544,135 289,050 286,263 334,065 76	10,000,000 26,100,000 4,000 4,000 56,297,000 - 3,287,550 1,739,978 64,143 9,250,000 6,993,000 (Note 1) (Note 1) (Note 1) 27,892,834 4,415,299 30,557,900 50,000 1,020,000 3,161,500 3,485,997 8,368,000 4,411,559 (Note 1) (Note 1) (Note 1) 15,430,293 7,796,914 37,574 68,550,000 28,000,000 19,500,000 19,010,000 20,915,000 5,401	100.00 100.00 25.00 25.00 1.29 - 31.00 0.03 0.01 0.21 69.93 100.00 99.00 95.04 99.87 0.08 26.95 0.01 0.02 0.20 0.41 0.19 3.89 1.00 99.99 4.96 0.29 0.92 0.01 100.00 100.00 100.00 100.00 100.00 -	$ 319,223 888,698 120,649 118,975 890,053 - 51,455 40,356 941 145,992 87,687 291,247 68,599 65,207 740,647 109,949 585,374 1,805 31,091 84,246 35,455 132,075 84,414 693 1,915 3,403 649,483 72,456 850 2,064,326 891,935 542,204 588,459 442,420 76	$ 52,787 106,605 3,831 (3,076) 13,578,105 - 8,847 10,732,669 1,621,695 13,578,105 27,530 7,838 (72,481) (43,552) 109,850 10,732,669 117,812 1,621,695 10,732,669 14,106,889 1,621,695 13,578,105 117,812 (72,481) (219) (43,552) 10,732,669 1,621,695 1,097,061 306,888 101,257 36,662 48,009 14,774 1,262,905	Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable	A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation

(Continued)

90 -

Investor Company	Investee Company	Location	Main Businesses and Products	Investment Amount	Investment Amount	Balance	as of December 31, 2019	as of December 31, 2019	Net Income (Loss) of the Investee	Share of Profits (Loss)	Note
				December 31, 2019	December 31, 2018	Shares	Percentage of Ownership	Carrying Value
YLT ACE ACP ACP II ACP III ACP IV Leap Mega Mega II Mega III Mega IV KCC JFTL AOG	FMT NHC AEE FSMS FDT YSRMC EISF YTRMC CSCGL U-Ming CSCGL Opas Fund Segregated Portfolio Company Drive Catalyst SPC CSCGL CSCGL CSCGL CSCGL CSCGL CSCGL CSCGL CSCGL CSCGL KCCL Join Fortune Trading Ltd. Empire Success Corp Ltd. Profit Enterprises Int'l Ltd. Asia Oriental Concrete, LLC Perez-Mtec-ACC, L.L.C.	Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Cayman Taiwan Cayman Cayman Cayman Cayman Cayman Cayman Cayman Cayman Cayman Cayman Cayman Cayman Hong Kong B.V.I. Hong Kong Hong Kong Guam Guam	Transportation Cement, granulated blast-furnace slag Engineering Mining excavation, mineral processing and sales Transportation Ready-mixed concrete Iron and steel Ready-mixed concrete, cement - related products Investment Marine transportation Investment Investment Investment Investment Investment Investment Investment Investment Investment Investment Investment Investment Ready-mixed concrete Investment Storage and transportation Barge transportation Ready-mixed concrete Ready-mixed concrete	$ 176 78 116 119 110 37 15,649 53 556,895 58,840 266,882 1,531 494 1,959,250 544,689 290,967 292,032 567,556 554,533 293,393 292,743 504,078 38 88,372 65,076 23,296 237,944 8,979	$ 176 78 116 119 110 37 15,649 53 556,895 58,840 266,882 1,531 494 1,959,250 544,689 290,967 292,032 567,556 554,533 293,393 292,743 504,078 38 88,372 65,076 23,296 178,084 8,979	5,000 5,000 6,000 5,000 7,145 5,000 660,000 5,782 31,528,000 6,348,103 7,480,000 33 33 107,536,000 36,865,000 14,790,000 18,514,000 35,569,000 30,251,000 16,058,000 18,477,000 37,410,000 10,000 2,979,721 17,040,000 6,100,000 (Note 1) (Note 1)	0.02 0.02 0.07 0.38 0.03 0.05 8.33 - 0.72 0.75 0.17 33.00 33.00 2.47 0.85 0.34 0.43 0.82 0.70 0.37 0.42 0.86 100.00 100.00 50.00 50.00 71.70 33.33	$ 272 80 120 125 199 44 16,630 53 498,144 308,774 118,080 1,607 488 1,700,893 583,507 233,970 293,443 562,979 479,139 254,137 291,688 591,806 138,589 18,957 16,508 3,289 22,269 42	$ 213,189 52,531 59,946 (6,936) 109,850 27,530 14,020 146,801 13,578,105 1,621,695 13,578,105 113 20 13,578,105 13,578,105 13,578,105 13,578,105 13,578,105 13,578,105 13,578,105 13,578,105 13,578,105 13,198 584 (559) 1,253 (66,247) -	Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable	A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation

(Continued)

91 -

Investor Company	Investee Company	Location	Main Businesses and Products	Investment Amount	Investment Amount	Balance	as of December 31, 2019	as of December 31, 2019	Net Income (Loss) of the Investee	Share of Profits (Loss)	Note
				December 31, 2019	December 31, 2018	Shares	Percentage of Ownership	Carrying Value
ACSPL ACCHC	OCPL ACCHC Alliance Concrete Singapore Pte. Ltd. PIHPL	Singapore Cayman Singapore B.V.I.	Ready-mixed concrete, leasing Investment Ready-mixed concrete Investment	$ 377,230 598,600 155,330 26,356,747	$ 377,230 598,600 155,330 26,356,747	17,000,000 63,790,798 6,000,000 9,379,303	100.00 4.07 50.00 100.00	$ 260,244 2,488,498 206,833 74,365,545	$ 3,400 14,106,889 204,204 15,638,825	Not applicable Not applicable Not applicable Not applicable	A subsidiary of the Corporation A subsidiary of the Corporation A subsidiary of the Corporation

Note 1: This is not a company limited by shares.

(Concluded)

92 -

TABLE 8

ASIA CEMENT CORPORATION

INVESTMENT IN MAINLAND CHINA YEAR ENDED DECEMBER 31, 2019 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Investee Company	Main Businesses and Products	Paid-in Capital	Method of Investment (Note 2)	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2019	Remittance of Funds	Remittance of Funds	Accumulated Outward Remittance for Investment from Taiwan as of December 31, 2019	Net Income (Loss) of the Investee	% Ownership of Direct or Indirect Investment	Investment Gain (Loss) (Note 1)	Carrying Amount as of December 31, 2019	Accumulated Repatriation of Investment Income as of December 31, 2019
					Outward	Inward
SHYLCP JYDC WYDC SHYFCP OHC NYLC NYDC SIYDCCL CYCPCL JYLTC	It manufactures and sells ready-mixed concrete and cement - related products It manufactures and sells cement, clinker and ready-mixed concrete (including cement - related products). It manufactures and sells cement, slag powder and slag cement. It manufactures and sells ready-mixed concrete and cement - related products Investment It manufactures and sells ready-mixed concrete and cement - related products It manufactures and sells cement, slag powder and slag cement. Cement, clinker, slag powder and ready-mixed concrete (including cement - related products) It manufactures and sells ready-mixed concrete and cement - related products Transportation	US$15,000 (equivalent to NT$448,950 thousand) US$356,104 (equivalent to NT$10,658,193 thousand) US$36,140 (equivalent to NT$1,081,670 thousand) - US$130,407 (equivalent to NT$3,903,082 thousand) RMB60,000 (equivalent to NT$257,419 thousand) RMB90,000 (equivalent to NT$386,128 thousand) US$368,340 (equivalent to NT$11,024,416 thousand) US$4,100 (equivalent to NT$122,713 thousand) RMB12,500 (equivalent to NT$53,629 thousand)	(2) (2) (2) - (2) (2) (2) (2) (2) (2)	US$11,200 (equivalent to NT$335,216 thousand) US$93,035 (equivalent to NT$2,784,538 thousand) RMB(126,758) (equivalent to NT$(543,832) thousand) US$22,081 (equivalent to NT$660,884 thousand) RMB(3,533) (equivalent to NT$(15,158) thousand) US$1,270 (equivalent to NT$38,011 thousand) US$54,191 (equivalent to NT$1,621,937 thousand) - - US$67,585 (equivalent to NT$2,022,819 thousand) RMB(4,091) (equivalent to NT$(17,552) thousand) US$2,023 (equivalent to NT$60,548 thousand) -	$ - - - - - - - - - -	$ - RMB(380,367) (equivalent to NT$(1,631,895) thousand) - - - - - RMB(136,094) (equivalent to NT$(583,886) thousand) - -	US$11,200 (equivalent to NT$335,216 thousand) US$93,035 (equivalent to NT$2,784,538 thousand) RMB(507,125) (equivalent to NT$(2,175,727) thousand) US$22,081 (equivalent to NT$660,884 thousand) RMB(3,533) (equivalent to NT$(15,158) thousand) US$1,270 (equivalent to NT$38,011 thousand) US$54,191 (equivalent to NT$1,621,937 thousand) - - US$67,585 (equivalent to NT$2,022,819 thousand) RMB(140,185) (equivalent to NT$(601,438) thousand) US$2,023 (equivalent to NT$60,548 thousand) -	RMB14,271 (equivalent to NT$63,986 thousand) RMB1,488,812 (equivalent to NT$6,675,264 thousand) RMB29,023 (equivalent to NT$130,126 thousand) - RMB386,044 (equivalent to NT$1,730,872 thousand) RMB(6,553) (equivalent to NT$(29,379) thousand) RMB15,586 (equivalent to NT$69,883 thousand) RMB1,264,886 (equivalent to NT$5,671,266 thousand) RMB14,136 (equivalent to NT$63,381 thousand) RMB6,397 (equivalent to NT$28,680 thousand)	72.00 68.40 72.00 - 72.00 68.40 52.20 72.00 72.00 70.12	RMB10,275 (equivalent to NT$46,070 thousand) RMB1,018,348 (equivalent to NT$4,565,881 thousand) RMB20,896 (equivalent to NT$93,691 thousand) - RMB277,951 (equivalent to NT$1,246,228 thousand) RMB(4,482) (equivalent to NT$(20,096) thousand) RMB8,136 (equivalent to NT$36,479 thousand) RMB910,718 (equivalent to NT$4,083,312 thousand) RMB10,178 (equivalent to NT$45,634 thousand) RMB4,485 (equivalent to NT$20,111 thousand)	RMB10,405 (equivalent to NT$44,643 thousand) RMB4,112,215 (equivalent to NT$17,642,702 thousand) RMB438,541 (equivalent to NT$1,881,481 thousand) - RMB2,077,855 (equivalent to NT$8,914,653 thousand) RMB112,989 (equivalent to NT$484,760 thousand) RMB88,543 (equivalent to NT$379,876 thousand) RMB3,773,937 (equivalent to NT$16,191,384 thousand) RMB59,238 (equivalent to NT$254,151 thousand) RMB25,780 (equivalent to NT$110,602 thousand)	US$800 (equivalent to NT$23,944 thousand) US$50,781 (equivalent to NT$1,519,875 thousand) RMB507,125 (equivalent to NT$2,175,727 thousand) US$4,469 (equivalent to NT$133,757 thousand) RMB3,533 (equivalent to NT$15,158 thousand) - US$809 (equivalent to NT$24,213 thousand) - - US$27,009 (equivalent to NT$808,379 thousand) RMB140,185 (equivalent to NT$601,438 thousand) US$77 (equivalent to NT$2,305 thousand) -
												(Continued)

93 -

Investee Company	Main Businesses and Products	Paid-in Capital	Method of Investment (Note 2)	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2019	Remittance of Funds	Remittance of Funds	Accumulated Outward Remittance for Investment from Taiwan as of December 31, 2019	Net Income (Loss) of the Investee	% Ownership of Direct or Indirect Investment	Investment Gain (Loss) (Note 1)	Carrying Amount as of December 31, 2019	Accumulated Repatriation of Investment Income as of December 31, 2019
					Outward	Inward
HYDCCL CYSPC SYCPCL SYTCL YYDCCL HGYDC HYTCL WYCPCL WYXC HZYCCL HXMC WAMTC TZOCCL	Cement, clinker, slag powder and ready-mixed concrete (including cement - related products) Slag powder It manufactures and sells ready-mixed concrete and cement - related products Transportation Cement, slag powder and ready-mixed concrete (including cement - related products) Cement, clinker, slag powder and ready-mixed concrete (including cement - related products) Transportation It manufactures and sells ready-mixed concrete and cement - related products Cement, clinker, slag powder and ready-mixed concrete (including cement - related products) It manufactures and sells ready-mixed concrete and cement - related products Production and sales of limestone Marine transportation Cement - related products	US$154,800 (equivalent to NT$4,633,164 thousand) - US$3,300 (equivalent to NT$98,769 thousand) US$3,500 (equivalent to NT$104,755 thousand) US$35,530 (equivalent to NT$1,063,413 thousand) US$86,170 (equivalent to NT$2,579,068 thousand) RMB13,000 (equivalent to NT$55,774 thousand) RMB60,000 (equivalent to NT$257,419 thousand) RMB90,000 (equivalent to NT$386,128 thousand) RMB30,000 (equivalent to NT$128,709 thousand) RMB10,000 (equivalent to NT$42,903 thousand) RMB35,500 (equivalent to NT$152,306 thousand) US$16,000 (equivalent to NT$478,880 thousand)	(2) - (2) (2) (2) (2) (2) (2) (2) (2) (2) (2) (2)	US$44,610 (equivalent to NT$1,335,177 thousand) RMB(36,155) (equivalent to NT$(155,116) thousand) US$980 (equivalent to NT$29,331 thousand) US$2,970 (equivalent to NT$88,892 thousand) US$2,158 (equivalent to NT$64,589 thousand) US$14,833 (equivalent to NT$443,952 thousand) US$13,513 (equivalent to NT$404,444 thousand) RMB(24,078) (equivalent to NT$(103,302) thousand) - - - - - - -	$ - - - - - - - - - - - - -	RMB(87,753) (equivalent to NT$(376,488) thousand) - - - - RMB(67,959) (equivalent to NT$(291,566) thousand) - - - - - - -	US$44,610 (equivalent to NT$1,335,177 thousand) RMB(123,908) (equivalent to NT$(531,604) thousand) US$980 (equivalent to NT$29,331 thousand) US$2,970 (equivalent to NT$88,892 thousand) US$2,158 (equivalent to NT$64,589 thousand) US$14,833 (equivalent to NT$443,952 thousand) US$13,513 (equivalent to NT$404,444 thousand) RMB(92,037) (equivalent to NT$(394,868) thousand) - - - - - - -	RMB430,511 (equivalent to NT$1,930,247 thousand) - RMB17,747 (equivalent to NT$79,571 thousand) RMB4,087 (equivalent to NT$18,323 thousand) RMB50,419 (equivalent to NT$226,061 thousand) RMB265,762 (equivalent to NT$1,191,577 thousand) RMB112 (equivalent to NT$501 thousand) RMB23,129 (equivalent to NT$103,702 thousand) RMB45,088 (equivalent to NT$202,157 thousand) RMB6,787 (equivalent to NT$30,430 thousand) RMB10,800 (equivalent to NT$48,425 thousand) RMB10,804 (equivalent to NT$48,439 thousand) RMB13,131 (equivalent to NT$58,875 thousand)	72.00 - 72.00 72.00 72.00 72.00 72.00 72.00 64.79 28.80 28.80 34.20 72.00	RMB309,968 (equivalent to NT$1,389,778 thousand) - RMB12,778 (equivalent to NT$57,291 thousand) RMB2,942 (equivalent to NT$13,193 thousand) RMB36,302 (equivalent to NT$162,764 thousand) RMB191,349 (equivalent to NT$857,936 thousand) RMB80 (equivalent to NT$360 thousand) RMB16,653 (equivalent to NT$74,665 thousand) RMB28,758 (equivalent to NT$128,941 thousand) RMB1,955 (equivalent to NT$8,764 thousand) RMB2,948 (equivalent to NT$13,217 thousand) RMB3,751 (equivalent to NT$16,820 thousand) RMB8,982 (equivalent to NT$40,271 thousand)	RMB1,884,938 (equivalent to NT$8,086,981 thousand) - RMB38,641 (equivalent to NT$165,782 thousand) RMB31,255 (equivalent to NT$134,095 thousand) RMB300,302 (equivalent to NT$1,288,390 thousand) RMB915,154 (equivalent to NT$3,926,300 thousand) RMB13,316 (equivalent to NT$57,130 thousand) RMB65,039 (equivalent to NT$279,036 thousand) RMB256,172 (equivalent to NT$1,099,058 thousand) RMB13,305 (equivalent to NT$57,084 thousand) RMB6,819 (equivalent to NT$29,255 thousand) RMB32,162 (equivalent to NT$137,985 thousand) RMB60,949 (equivalent to NT$261,493 thousand)	US$12,990 (equivalent to NT$388,791 thousand) RMB123,908 (equivalent to NT$531,604 thousand) - - US$992 (equivalent to NT$29,691 thousand) US$1,016 (equivalent to NT$30,409 thousand) US$1,837 (equivalent to NT$54,981 thousand) RMB92,037 (equivalent to NT$394,868 thousand) - - - - - - -

(Continued)

94 -

Investee Company	Main Businesses and Products	Main Businesses and Products	Paid-in Capital	Method of Investment (Note 2)	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2019	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2019	Remittance of Funds	Remittance of Funds	Accumulated Outward Remittance for Investment from Taiwan as of December 31, 2019	Net Income (Loss) of the Investee	% Ownership of Direct or Indirect Investment	Investment Gain (Loss) (Note 1)	Carrying Amount as of December 31, 2019	Accumulated Repatriation of Investment Income as of December 31, 2019
							Outward	Inward
SLCL SLCCL YDES RYNM	Cement, clinker, slag powder and ready-mixed concrete (including cement - related products) Cement - related products Wholesale of chemical products and machinery equipment, design and development of computer software and network technology Building materials, products and construction waste		RMB600,000 (equivalent to NT$2,574,190 thousand) RMB20,000 (equivalent to NT$85,806 thousand) RMB1,763,425 (equivalent to NT$7,565,650 thousand) RMB2,000 (equivalent to NT$8,581 thousand)	(2) (2) (2) (2)	$	- - - -	$ - - - -	$ - - - -	$ - - - -	RMB568,864 (equivalent to NT$2,550,570 thousand) RMB(503) (equivalent to NT$((2,254) thousand) RMB(22,262) (equivalent to NT$(99,813) thousand) RMB47,672 (equivalent to NT$213,741 thousand)	72.00 72.00 28.80 68.40	RMB407,522 (equivalent to NT$1,827,173 thousand) RMB(362) (equivalent to NT$(1,623) thousand) RMB(5,434) (equivalent to NT$(24,364) thousand) RMB32,607 (equivalent to NT$146,199 thousand)	RMB1,512,948 (equivalent to NT$6,491,023 thousand) RMB(15,014) (equivalent to NT$(64,413) thousand) RMB508,783 (equivalent to NT$2,182,839 thousand) RMB33,975 (equivalent to NT$145,765 thousand)	$ - - - -

Accumulated Outward Remittance for Investment in Mainland China as of December 31, 2019		Investment Amounts Authorized by Investment Commission, MOEA				Upper Limit on the Amount of Investment Stipulated by Investment Commission, MOEA
US$481,069 (Note 3) (equivalent to NT$14,398,395 thousand) RMB(866,788) (equivalent to NT$(3,718,794) thousand)		US$2,284,279 (equivalent to NT$68,368,470 thousand)				(Note 4)

Note 1: The accrual is based on the financial statements audited by independent auditors.

(Concluded)

95 -

AI assistant

ACC — Annual Report 2019

51736_rns_2020-07-08_ebc66a10-e7f1-4e98-be34-bd3e355c1dc3.pdf

ASIA CEMENT CORPORATION 2019 Annual Report

Notice to readers

Spokesperson

Headquarter and Plants

Headquarter

IR Contact & Deputy Spokesperson

Hsinchu Plant

Stock Transfer Agent

Auditors

Overseas Securities Exchange

Corporate Website

Table of Contents

I Report to Shareholders

2019 Business Report

1. Review of the Year 2019

Review of the international economic situation in 2019

Review of the domestic economic situation in 2019

The Company's business performance in 2019

2. Operating Performance of 2019

＊ key performance indicator:

＊ key performance indicator:

B. Sales

i. Taiwan area:

＊ Key Performance Indicator:

＊ Key Performance Indicator:

3. The Company’s Layout Strategy in China

4. Overview of The Company’s Investments in China

A. Jiangxi Yadong Cement Co., Ltd

B. Sichuan Yadong Cement Co., Ltd

C. Hubei Yadong Cement Co., Ltd

D. Huanggang Yadong Cement Co., Ltd

E. Wuhan Yaxin Cement Co., Ltd

F. Sichuan Lanfeng Cement Corp.

5. Prospects for the Economic Situations in 2020

6. Prospects for the cement industry on both sides across the Taiwan Straits

B. Cement industry in Taiwan

7. Business Outlook of the Company in 2020

8. The Company's Operating Status in the First Quarter of 2020

II Company Profile

2.1 Date of Incorporation: March 21, 1957.

Scope of Business:

2.2 Company History

3.1.2 Major Corporate Functions

Company Organization with Functions of Risk Management

The Company has established an information security risk management framework:

Information security policy:

Specific management plan:

3.2 Directors, Supervisors and Management Team

3.2.1 Directors and Supervisors

The First and Most Recent Date for Institutional Investors Elected as Directors

3.2.2 Major Shareholders of the Institutional Shareholders

3.2.3 Major Shareholders of the Major Shareholders That Are Juridical Persons

3.2.4 Professional Qualifications and Independence Analysis of Directors

3.2.5 Management Team

3.2.6 Remuneration of Directors, Supervisors, President, and Vice Presidents

1. Remuneration of Directors

＊ The succession planning of the Company's Board of Directors and important managers

Member of the Board of Directors:

3. Remuneration of President and Vice Presidents

3.2.7 Employees Remuneration to Management Team

3.2.8 Name and Title of the Top 10 Employees Who Were Distributed Employees Remuneration

3.3 Implementation of Corporate Governance

3.3.1 Board of Directors

3.3.2 Other mentionable items:

1. Board of Directors

Goals :

Implementation Status and Assessment:

3.3.3 Annual priorities of Audit committee

3.3.4 Attendance of Audit committee

Other mentionable items:

1. Items listed in Article 14-5 of the Securities Exchange Act:

None.

3.3.5 Corporate Governance Execution Status and Deviations from “Corporate Governance Best-Practice Principles for TWSE/ TPEx Listed Companies”

3.3.6 The Composition, Duty, and Implementation Status of the Remuneration Committee

1. Professional Qualifications and Independence Analysis of Members of the Remuneration Committee

2. Implementation Status of the Remuneration Committee

3.3.7 Corporate Social Responsibility

ACC Annual Report 2019