ACE - Audit Report / Information 2021

Jinan Acetate Chemical Co., Ltd. and Subsidiaries

Consolidated Financial Statements for the Years Ended December 31, 2021 and 2020 and Independent Auditors’ Report

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders Jinan Acetate Chemical Co., Ltd.

Opinion

We have audited the accompanying consolidated financial statements of Jinan Acetate Chemical Co., Ltd. (the “Company”) and its subsidiaries (collectively referred to as the “Group”), which comprise the consolidated balance sheets as of December 31, 2021 and 2020, 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, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2021 and 2020, 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, 2021. 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.

Key audit matters of the Group’s consolidated financial statements for the year ended December 31, 2021 are stated as follows:

Occurrence of Operating Revenue Recognize in Substantial Growth of Customers Sales

At the year ended December 31, 2021, the Group’s revenue increased compare to the year ended December 31, 2020. In 2021, among part of the Group’s customers have substantial growth in operating revenue than previous year. We, therefore, consider the recognition of operating revenue growth with customers sales, which have substantial growth in operating revenue than previous year as a key audit matter. Please refer to Notes 4 and 23 to the consolidated financial statements for the relevant accounting policy.

The key audit procedures performed in respect of the above area included the following:

We obtained on understanding of the Group’s policies procedures and internal controls for revenue recognition and tested the effectiveness and efficiency of operations of the key controls over the occurrence of revenue recognize.
We analyzed the sales customers, which mentioned above, with the reason for the change in operating revenue.
We selected the sample transactions of the sales customers, which mentioned above, in the sales records for substantive tests and confirmed them with the supporting shipping documents, and verified the collection after the reporting period.

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 the 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 members of 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.

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, 2021 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 Yao-Ling Huang and Suei-Chin Lee.

Deloitte & Touche Taipei, Taiwan Republic of China

March 11, 2022

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.

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 4 and 6) Financial assets at fair value through profit or loss - current (Notes 4 and 7) Financial assets at amortized cost - current (Notes 4, 9 and 30) Notes and accounts receivable, net (Notes 4, 10 and 23) Accounts receivable from related parties (Notes 4, 10, 23 and 29) Other receivables (Note 4) Current tax assets (Notes 4 and 25) Inventories, net (Notes 4 and 11) Prepayments (Notes 17 and 29) Non-current assets held for sale (Notes 4 , 12 and 32) Other current assets (Notes 4, 17, 29 and 30) Total current assets NON-CURRENT ASSETS Financial assets at fair value through other comprehensive income - non-current (Notes 4 and 8) Property, plant and equipment (Notes 4, 14 and 30) Right-of-use assets (Notes 4, 15 and 30) Investment properties, net (Notes 4, 16 and 30) Deferred tax assets (Notes 4 and 25) Other non-current assets (Notes 4 and 17) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Notes 18 and 30) Financial liabilities at fair value through profit or loss - current (Notes 4, 7 and 19) Contract liabilities - current (Note 23) Notes and accounts payable, net Other payables (Notes 20 and 29) Current portion of bonds payable (Notes 4 and 19) Current portion of long-term borrowings (Note 18) Other current liabilities Total current liabilities NON-CURRENT LIABILITIES Long-term borrowings (Note 18) Financial liabilities at fair value through profit or loss - non-current (Notes 4, 7 and 19) Bonds payable (Notes 4 and 19) Deferred tax liabilities (Notes 4 and 25) Total non-current liabilities Total liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY (Notes 4 and 22) Share capital Ordinary Shares Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Total retained earnings Other equity Exchange differences on translating the financial statements of foreign operations Unrealized valuation loss on financial assets at fair value through other comprehensive income Revaluation surplus (Note 12) Total other equity Treasury shares Total equity attributable to owners of the Company NON-CONTROLLING INTERESTS Total equity TOTAL		2021 Amount % $ 646,169 18 697 - 169,309 5 425,429 12 18,589 - 29,782 1 6,141 - 382,732 10 222,937 6 101,128 3 143,312 4 2,146,225 59 24,055 1 1,265,424 35 77,960 2 - - 44,056 1 77,470 2 1,488,965 41 $ 3,635,190 100 $ 489,416 13 2,591 - 126,900 4 140,061 4 216,472 6 349,167 10 41,520 1 6,231 - 1,372,358 38 41,520 1 43,380 1 530,796 15 9,610 - 625,306 17 1,997,664 55 585,756 16 433,575 12 184,044 5 63,211 2 482,010 13 729,265 20 (125,963) (4) (16,882) - 65,146 2 (77,699) (2) (153,986) (4) 1,516,911 42 120,615 3 1,637,526 45 $ 3,635,190 100		2020
				Amount % $ 831,330 27 - - 4,865 - 586,078 19 75,387 3 35,585 1 3,628 - 219,979 7 63,982 2 - - 92,318 3 1,913,152 62 25,829 1 898,321 29 53,811 2 101,897 3 34,080 1 81,977 2 1,195,915 38 $ 3,109,067 100 $ 56,960 2 21,798 1 47,573 1 157,488 5 156,896 5 473,921 15 - - 1,657 - 916,293 29 - - 61,140 2 513,646 17 9,577 - 584,363 19 1,500,656 48 510,767 17 433,575 14 133,588 4 78,601 3 509,525 16 721,714 23 (110,395) (4) (15,619) - 65,146 2 (60,868) (2) (115,905) (4) 1,489,283 48 119,128 4 1,608,411 52 $ 3,109,067 100

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

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OPERATING REVENUE (Notes 4, 23 and 29) OPERATING COSTS (Notes 11, 24 and 29) GROSS PROFIT OPERATING EXPENSES (Notes 24 and 29) Selling and marketing expenses General and administrative expenses Research and development expenses Total operating expenses PROFIT FROM OPERATIONS NON-OPERATING INCOME AND EXPENSES (Note 24) Other income Other gains and losses Finance costs Interest income Net gain on fair value changes of financial liabilities at fair value through profit or loss (Note 19) Total non-operating income and expenses PROFIT BEFORE INCOME TAX INCOME TAX EXPENSE (Notes 4 and 25) NET PROFIT FOR THE YEAR		2021 Amount % $ 2,714,866 100 (1,899,781) (70) 815,085 30 (192,040) (7) (80,306) (3) (190,486) (7) (462,832) (17) 352,253 13 30,989 1 (31,727) (1) (35,073) (2) 2,247 - 46,755 2 13,191 - 365,444 13 (5,245) - 360,199 13		2020
				Amount % $ 2,353,380 100 (1,564,853) (67) 788,527 33 (126,578) (5) (65,306) (3) (97,428) (4) (289,312) (12) 499,215 21 49,077 2 (27,010) (1) (25,860) (1) 1,778 - 55,650 2 53,635 2 552,850 23 (43,269) (2) 509,581 21 (Continued)

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OTHER COMPREHENSIVE INCOME (LOSS) (Note 4) Items that will not be reclassified subsequently to profit or loss Unrealized loss on investments in equity instruments at fair value through other comprehensive income Exchange differences arising on translation to the presentation currency Total other comprehensive (loss) income TOTAL COMPREHENSIVE INCOME FOR THE YEAR NET PROFIT ATTRIBUTABLE TO: Owners of the Company Non-controlling interests TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO: Owners of the Company Non-controlling interests EARNINGS PER SHARE (NT$, Note 26) Basic Diluted		2021 Amount % $ (1,578) - (16,465) - (18,043) - $ 342,156 13 $ 357,500 13 2,699 - $ 360,199 13 $ 340,669 13 1,487 - $ 342,156 13 $ 6.23 $ 5.32		2020
				Amount % $ (6,278) - 22,392 - 16,114 - $ 525,695 21 $ 504,558 21 5,023 - $ 509,581 21 $ 519,947 21 5,748 - $ 525,695 21 $ 8.75 $ 8.67

		$		$
		$		$
		$		$
		$		$
		$		$

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

(Concluded)

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars)

		Equity Attributable toOwners of theCompany	Equity Attributable toOwners of theCompany	Equity Attributable toOwners of theCompany	Equity Attributable toOwners of theCompany
Share Capital Shares (In Thousands) Amount 51,077 $ 510,767 - - - - - - - - - - - - - - - - 51,077 510,767 - - - - - - 7,499 74,989 7,499 74,989 - - - - - - - - 58,576 $ 585,756	Capital Surplus $ 433,575 - - - - - - - - 433,575 - - - - - - - - - $ 433,575	Retained Earnings	Total $ 454,805 - - (237,649) (237,649) 504,558 - 504,558 - 721,714 - - (274,960 ) (74,989) (349,949) 357,500 - 357,500 - $ 729,265	Other Equity		Total $ (76,257) - - - - - 15,389 15,389 - (60,868) - - - - - - (16,831) (16,831) - $ (77,699)	Treasury Shares $ (63,586) - - - - - - - (52,319) (115,905) - - - - - - - - (38,081) $ (153,986)
				Exchange Differences on Translating the Financial Statements of Unrealized Valuation Gain (Loss) on Financial Assets at Fair Value Through Other Foreign Comprehensive Operations Income $ (130,806) $ (10,597) - - - - - - - - - - 20,411 (5,022) 20,411 (5,022) - - (110,395) (15,619) - - - - - - - - - - - - (15,568) (1,263) (15,568) (1,263) - - $ (125,963) $ (16,882)	Gains on Property Revaluation $ 65,146 - - - - - - - - 65,146 - - - - - - - - - $ 65,146
Shares (In Thousands) 51,077 - - - - - - - - 51,077 - - - 7,499 7,499 - - - - 58,576		Unappropriated Legal Reserve Special Reserve Earnings $ 100,620 $ 21,406 $ 332,779 32,968 - (32,968 ) - 57,195 (57,195 ) - - (237,649) 32,968 57,195 (327,812) - - 504,558 - - - - - 504,558 - - - 133,588 78,601 509,525 50,456 - (50,456 ) - (15,390 ) 15,390 - - (274,960 ) - - (74,989) 50,456 (15,390) (385,015) - - 357,500 - - - - - 357,500 - - - $ 184,044 $ 63,211 $ 482,010

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

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments for: Depreciation expenses Net gain on fair value changes of financial liabilities at fair value through profit or loss Finance costs Interest income Loss on disposal of property, plant and equipment Write-downs of inventories Changes in operating assets and liabilities Financial assets at fair value through profit or loss Notes receivable and Accounts receivable Accounts receivable from related parties Other receivables Inventories Prepayments Other current assets Financial liability held for trading Contract liabilities Notes and accounts payable Other payables Other current liabilities Cash generated from operations Interest paid Income taxes paid Net cash generated from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Purchase of financial assets at amortized cost Proceeds from disposal of financial assets at amortized cost Payments for property, plant and equipment Proceeds from disposal of property, plant and equipment Decrease in refundable deposits Decrease in other non-current assets Increase in prepayments for equipment Interest received Net cash used in investing activities	2021 $ 365,444 134,565 (46,755) 35,073 (2,247) 223 559 10,920 160,649 56,798 4,941 (163,312) (158,955) (50,994) 3,557 79,327 (17,427) 59,576 3,916 475,858 (2,892) (17,819) 455,147 (164,444) - (424,779) 39 (26,662) 10 (77,443) 3,109 (690,170)	2020 $ 552,850 105,376 (55,650) 25,860 (1,778) 22 267 - (235,434) 11,862 (8,822) 22,723 (9,663) (25,253) - 31,123 (64,898) (392) (2,682) 345,511 (3,993) (46,796) 294,722 (3,798) 98,680 (141,008) 2 - 1,368 (80,162) 1,143 (123,775) (Continued)

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from (repayments of) short-term borrowings Proceeds from issuance of convertible bonds Repayments of convertible bonds Proceeds from long-term borrowings Proceeds from (refund of) guarantee deposits received Dividends paid to owners of the Company Payments for buy-back of ordinary shares Net cash generated from financing activities EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE OF CASH 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	2021 $ 438,969 - (148,727) 83,040 658 (274,960) (38,081) 60,899 (11,037) (185,161) 831,330 $ 646,169	2020 $ (236,400) 601,416 - - (1,042) (237,649) (52,319) 74,006 (2,884) 242,069 589,261 $ 831,330

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

(Concluded)

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JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

1. GENERAL INFORMATION

Jinan Acetate Chemical Co., Ltd. (the “Company”) was incorporated in Cayman Islands on September 25, 2014. The Company was established mainly for organizational restructuring. In accordance with the equity exchange agreement, the Company has become the holding company of the consolidated entities after the organizational restructuring have been completed on September 25, 2014.

The Company’s shares have been listed on the Taiwan Stock Exchange (TSE) since November 9, 2015.

The Company’s functional currency is Renminbi. However, due to the listing in the TSE, the consolidated financial statements are presented in New Taiwan dollars for greater comparability and consistency of financial reporting.

2. APPROVAL OF FINANCIAL STATEMENTS

The consolidated financial statements were approved by the Company’s board of directors on March 9, 2022.

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), IFRS 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.

b. The IFRSs endorsed by the Financial Supervisory Commission (FSC) for application starting from 2022

New IFRSs “Annual Improvements to IFRS Standards 2018-2020” Amendments to IFRS 3 “Reference to the Conceptual Framework” Amendments to IAS 16 “Property, Plant and Equipment - Proceeds before Intended Use” Amendments to IAS 37 “Onerous Contracts - Cost of Fulfilling a Contract”	Effective Date Announced by International Accounting Standards Board (IASB)
	January 1, 2022 (Note 1) January 1, 2022 (Note 2) January 1, 2022 (Note 3) January 1, 2022 (Note 4)

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Note 1: The amendments to IFRS 9 will be applied prospectively to modifications and exchanges of financial liabilities that occur on or after the annual reporting periods beginning on or after January 1, 2022. The amendments to IAS 41 “Agriculture” will be applied prospectively to the fair value measurements on or after the annual reporting periods beginning on or after January 1, 2022. The amendments to IFRS 1 “First-time Adoptions of IFRSs” will be applied retrospectively for annual reporting periods beginning on or after January 1, 2022.
Note 2: The amendments are applicable to business combinations for which the acquisition date is on or after the beginning of the annual reporting period beginning on or after January 1, 2022.
Note 3: The amendments are applicable to property, plant and equipment that are brought to the location and condition necessary for them to be capable of operating in the manner intended by management on or after January 1, 2021.
Note 4: The amendments are applicable to contracts for which the entity has not yet fulfilled all its obligations on January 1, 2022.

As of the date the consolidated financial statements were authorized for issue, the Group is continuously assessing the possible impact that the application of other 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 IFRS 17 Amendments to IFRS 17 “Initial Application of IFRS 9 and IFRS 17 - Comparative Information” Amendments to IAS 1 “Classification of Liabilities as Current or Non-current” Amendments to IAS 1 “Disclosure of Accounting Policies” Amendments to IAS 8 “Definition of Accounting Estimates” Amendments to IAS 12 “Deferred Tax related to Assets and Liabilities arising from a Single Transaction”	Effective Date Announced by IASB (Note 1)
	To be determined by IASB January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 (Note 2) January 1, 2023 (Note 3) January 1, 2023 (Note 4)

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 IFRS 17

Amendments to IFRS 17 “Initial Application of IFRS 9 and IFRS 17 -
Comparative Information”

Amendments to IAS 1 “Classification of Liabilities as Current or
Non-current”

Amendments to IAS 1 “Disclosure of Accounting Policies”

Amendments to IAS 8 “Definition of Accounting Estimates”

Amendments to IAS 12 “Deferred Tax related to Assets and
Liabilities arising from a Single Transaction”

Effective Date
Announced by IASB (Note 1)

To be determined by IASB
January 1, 2023
January 1, 2023
January 1, 2023
January 1, 2023
January 1, 2023 (Note 2)
January 1, 2023 (Note 3)
January 1, 2023 (Note 4)

Note 1: Unless stated otherwise, the above New IFRSs are effective for annual reporting periods beginning on or after their respective effective dates.
Note 2: The amendments will be applied prospectively for annual reporting periods beginning on or after January 1, 2023.
Note 3: The amendments are applicable to changes in accounting estimates and changes in accounting policies that occur on or after the beginning of the annual reporting period beginning on or after January 1, 2023.
Note 4: Except for deferred taxes that will be recognized on January 1, 2022 for temporary differences associated with leases and decommissioning obligations, the amendments will be applied prospectively to transactions that occur on or after January 1, 2022.
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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 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 the financial instruments and investment properties which are measured at fair value.

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 the 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 the asset or liability.
c. Classification of current and non-current assets and liabilities

Current assets include:

1) Assets held primarily for the purpose of trading;
2) Assets expected to be realized within 12 months after the reporting period; and
3) 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:

1) Liabilities held primarily for the purpose of trading;
2) Liabilities due to be settled within 12 months after the reporting period; and
3) Liabilities for which the Group does not have an unconditional right to defer settlement for at least 12 months after the reporting period.

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

d. Basis of consolidation

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

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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 Company.

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 Company 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 Company.

See Note 13, Tables 7 and 8 for the detailed information of subsidiaries (including percentages of ownership and main businesses).

e. Foreign currencies

In preparing the financial statements of each individual group 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 not retranslated.

For the purpose of presenting consolidated financial statements, the functional currencies of the Company and the other entities in the Group (including subsidiaries and branches in other countries that use currency which are different from the currency of the Company) 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 Company and non-controlling interests as appropriate).

14 -

f. Inventories

Inventories consist of raw materials, supplies, finished goods and work in progress 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.

g. Property, plant and equipment

Property, plant and equipment are initially measured at cost and subsequently measured at cost less accumulated depreciation and accumulated impairment loss.

Property, plant and equipment in the course of construction are measured at cost less any recognized impairment loss. Cost includes professional fees and borrowing costs eligible for capitalization. Such assets are depreciated and classified to the appropriate categories of property, plant and equipment when completed and ready for their intended use.

The depreciation of property, plant and equipment is recognized using 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 effects of any changes in the estimates 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.

h. 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.

Investment properties are measured initially 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.

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.

i. Impairment of property, plant and equipment and right-of-use asset

At the end of each reporting period, the Group reviews the carrying amounts of its property, plant and equipment and right-of-use asset, to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. 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.

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.

15 -

When an impairment loss is subsequently reversed, the carrying amount of the corresponding asset, cash-generating unit or assets related to contract costs 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, cash-generating unit or assets related to contract costs in prior years. A reversal of an impairment loss is recognized in profit or loss.

j. Non-current assets held for sale

Non-current assets are classified as held for sale if their carrying amounts will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the non-current asset is available for immediate sale in its present condition. To meet the criteria for the sale being highly probable, the appropriate level of management must be committed to the sale, and the sale should be expected to qualify for recognition as a completed sale within 1 year from the date of classification.

Non-current assets classified as held for sale are measured at the lower of their previous carrying amount and fair value less costs to sell. Such assets classified as held for sale are not depreciated.

k. 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 the acquisition or issue 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.

1) 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 financial assets at FVTOCI.

i. Financial assets at FVTPL

Financial assets at FVTPL are subsequently measured at fair value, and any remeasurement gains or losses on such financial assets are recognized in other gains or losses.

ii. Financial assets at amortized cost

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

i) The financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and
ii) 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.
16 -

Subsequent to initial recognition, financial assets at amortized cost, including cash and cash equivalents, notes receivable, accounts receivable, other receivables, other current financial assets and refundable deposits, are measured at amortized cost, which equals to gross carrying amount determined using 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 a financial asset, expect for:

i) Purchased or originated credit-impaired financial assets, for which interest income is calculated by applying the credit adjusted effective interest rate to the amortized cost of such financial assets; and
ii) Financial assets that are not credit impaired on purchase or origination but have subsequently become credit impaired, for which interest income is calculated by applying the effective interest rate to the amortized cost of such financial assets in subsequent reporting periods.

Cash equivalents include time deposits 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.

iii. 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 as 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, it will be transferred to retained earnings.

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 losses on financial assets at amortized cost (including trade receivables).

The Group always recognizes lifetime expected credit losses (ECLs) for accounts receivable. For all other financial instruments, 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 a 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.

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Expected credit losses 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.

For internal credit risk management purposes, the Group determines that internal or external information show that the debtor is unlikely to pay its creditors indicate that a financial asset is in default.

The impairment loss of all financial assets is recognized in profit or loss by a reduction in their carrying amounts 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 difference between the asset’s carrying amount and the sum of the consideration received and receivable is recognized in profit or loss, and the cumulative gain or loss which had been recognized in other comprehensive income is transferred directly to retained earnings, without recycling through loss.

2) Equity instruments

Debt and equity instruments issued by the Group are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

Equity instruments issued by the Group are recognized at the proceeds received, net of direct issue costs.

The repurchase of the Company’s own equity instruments is recognized in and deducted directly from equity. No gain or loss is recognized in profit or loss on the purchase, sale, issuance or cancellation of the Company’s own equity instruments.

3) Financial liabilities
a) Subsequent measurement

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

Financial liabilities at FVTPL

Financial liabilities are classified as at FVTPL when such financial liabilities are either held for trading or are designated as at FVTPL. Fair value is determined in the manner described in Note 28.

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b) Derecognition of financial liabilities

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

4) Convertible bonds

The conversion option component of the convertible bonds issued by the Group, which will be settled other than by the exchange of a fixed amount of cash or other financial assets for a fixed number of the Company’s own equity instruments, is classified as a derivative financial liability.

On initial recognition, the derivative financial liability component of the convertible bonds is recognized at fair value, and the initial carrying amount of the non-derivative financial liability component is determined by deducting the amount of the derivative financial liability component from the fair value of the hybrid instrument as a whole. In subsequent periods, the non-derivative financial liability component of the convertible bonds is measured at amortized cost using the effective interest method. The derivative financial liability component is measured at fair value, and the changes in fair value are recognized in profit or loss. Transaction costs that relate to the issuance of the convertible notes are allocated to the derivative financial liability component and the non-derivative financial liability component in proportion to their relative fair values.

l. Revenue recognition

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

Revenue from the sale of goods comes from sales of cellulose acetate tow and cellulose acetate. Sales of cellulose acetate tow and cellulose acetate are recognized as revenue when the goods are shipped because it is the time when the customer has the primary responsibility for sales to future customers and bears the risks of obsolescence. Trade receivables are recognized concurrently.

m. Leasing

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

1) 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.

Lease payments (less any lease incentives payable) 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.

2) 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.

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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.

n. Borrowing costs

Borrowing costs directly attributable to an acquisition, construction or production of qualifying assets are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.

Other than that which is stated above, all other borrowing costs are recognized in profit or loss in the period in which they are incurred.

o. Government grants

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

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.

p. Employee benefits
1) 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.

2) Retirement benefits

The Group participates in the local government pension plans in accordance with local regulations, contributing pension regularly to the government according to a certain percentage of the employee’s salary. Payments to defined contribution retirement benefit plans are recognized as expenses for the current period when employees have rendered services entitling them to the contributions.

q. Taxation

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

1) Current tax

According to the People’s Republic of China (PRC) Enterprise Income Tax Law, the tax rate is 25%. Jinan Acetate Chemical Co., Ltd (China) of the Group and Acetek Material Co., Ltd (China) of the Group have acquired the High-tech Enterprise Certificate in 2018 and 2019. The applicable tax rate for both companies is 15%. Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax provision.

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2) Deferred tax

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities 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 carryforwards to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.

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 assets 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.

Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liabilities are settled or the assets are 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, the carrying amounts of such assets are presumed to be recovered entirely through sale.

3) Current and deferred taxes for the year

Current and deferred taxes are recognized in profit or loss, except when they relate to items that are recognized in other comprehensive income or directly in equity; in which case, the current and deferred taxes are also recognized in other comprehensive income or directly in equity, respectively.

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 on 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 Group considers the possible impact of the recent development of the COVID-19 in Taiwan and its economic environment implications when making its critical accounting estimates on cash flow projections, growth rate, discount rate, profitability, etc. 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.

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6. CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS
December 31 2021 2020 Cash on hand $ 226 $ 147 Demand deposits 512,754 831,183 Cash equivalents (investments with original maturities of less than 3 months) Time deposits 133,189 - $ 646,169 $ 831,330 FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS December 31 2021 2020 Financial assets at fair value through profit or loss (FVTPL)-current Financial assets mandatorily classified as at FVTPL Derivative financial assets (not under hedge accounting) Foreign exchange forward contracts (b) $ 697 $ - Financial liabilities at FVTPL-current Financial liabilities held for trading Derivative financial liabilities Convertible options (Note 19) $ 2,591 $ 21,450 Foreign exchange forward contracts - 348 $ 2,591 $ 21,798 Financial liabilities at FVTPL-non-current Financial liabilities held for trading Derivative financial liabilities Convertible options (Note 19) $ 43,380 $ 61,140	December 31
		2020 $ 147 831,183 - $ 831,330 31
	2021 $ 697 $ 2,591 - $ 2,591 $ 43,380	2020 $ - $ 21,450 348 $ 21,798 $ 61,140

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

At the end of the year, outstanding foreign exchange forward contracts not under hedge accounting were as follows:

follows:
					Notional Amount
			Currency	Maturity Date	(In Thousands)
December	31,	2021
Sell			USD/RMB	2022.1	USD500/RMB3,345
Sell			USD/RMB	2022.3	USD250/RMB1,610
					(Continued)

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					Notional Amount
			Currency	Maturity Date	(In Thousands)
December	31,	2020
Sell			USD/RMB	2021.1	USD1,500/RMB9,800
Sell			USD/RMB	2021.2	USD1,500/RMB9,820
Sell			USD/RMB	2021.3	USD1,500/RMB9,840
Sell			USD/RMB	2021.4	USD1,500/RMB9,857
Sell			USD/RMB	2021.5	USD1,500/RMB9,874
Sell			USD/RMB	2021.6	USD1,500/RMB9,892
					(Concluded)

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

Investments in equity instruments at FVTOCI

Investments in equity instruments at FVTOCI
Non-current Foreign investments Unlisted shares Ordinary shares - ELEUNG LIMITED		December	31
		2021 $ 24,055	2020 $ 25,829

The Group holds 25% of the ordinary shares of ELEUNG LIMITED. However, according to the shareholders’ agreement, the owner shareholders shall have the control in the composition of company’s board of directors, moreover, the Group has no authority to participate in the investee’s financial and operating policy decisions; therefore, the investment is not accounted for as an associated company.

These investments in equity instruments 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.

9. FINANCIAL ASSETS AT AMORTIZED COST

FINANCIAL ASSETS AT AMORTIZED COST
Current Domestic investments Time deposits with original maturities of more than 3 months		December 31
		2021 $ 169,309	2020 $ 4,865

a. The ranges of interest rates for time deposits with original maturities of more than 3 months were approximately 0.22%-0.25% and 0.40%-1.85% per annum as of December 31, 2021 and 2020, respectively.
b. Refer to Note 30 for information relating to investments in financial assets at amortized cost pledged as security.
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10. NOTES RECEIVABLE AND ACCOUNTS RECEIVABLE

NOTES RECEIVABLE AND ACCOUNTS RECEIVABLE
Notes and accounts receivable At amortized cost Gross carrying amount Less: Allowance for impairment loss Accounts receivable from related parties At amortized cost Gross carrying amount Less: Allowance for impairment loss		December 31
		2021 $ 425,429 - $ 425,429 $ 18,589 - $ 18,589	2020 $ 586,078 - $ 586,078 $ 75,387 - $ 75,387

The Group takes advance payments for the sales of goods through letters of credit. The credit period of sales of goods was between 30 and 180 days. No interest was charged on trade and notes receivable. The Group adopted a policy of only dealing with entities that are rated the equivalent of investment grade or higher and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. The Group uses other publicly available financial information or its own trading records to rate its major customers. The Group’s exposure and the credit ratings of its counterparties are continuously monitored and the aggregate value of transactions concluded is spread amongst approved counterparties.

The Group measures the loss allowance for trade receivables at an amount equal to lifetime ECLs. The expected credit losses on accounts receivable are estimated using a provision matrix by reference to the 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 forecasted direction of economic conditions at the reporting date. As the Group’s historical credit loss experience does not show significantly different loss patterns for different customer segments, the provision for loss allowance based on past due status is not further distinguished according to the Group’s different customer base.

The following table details the loss allowance of accounts receivable based on the Group’s provision matrix.

December 31, 2021

1 to 30 Days 31 to 60 Days 61 to 90 Days Expected credit loss rate 0% 0% 0% Gross carrying amount $ 268,848 $ 42,822 $ 31,044 Loss allowance (Lifetime ECL) - - - Amortized cost $ 268,848 $ 42,822 $ 31,044	91 to 120 Days 0% $ 40,318 - $ 40,318	121 to 180 Days 0% $ 60,986 - $ 60,986	181 to 360 Days 0% $ - - $ -	Total $ 444,018 -
				$ 444,018

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December 31, 2020

December 31, 2020
1 to 30 Days 31 to 60 Days 61 to 90 Days Expected credit loss rate 0% 0% 0% Gross carrying amount $ 238,911 $ 153,968 $ 107,272 Loss allowance (Lifetime ECL) - - - Amortized cost $ 238,911 $ 153,968 $ 107,272	91 to 120 Days 0% $ 70,827 - $ 70,827	121 to 180 Days 0% $ 90,487 - $ 90,487	181 to 360 Days 0% $ - - $ -	Total $ 661,465 -
				$ 661,465

Compare to January 1, 2021 and 2020, the group did not recognize allowance for impairment loss on receivables at December 31, 2021 and 2020, respectively; resulted from the decreased/increase in accounts receivables net of those collected of $217,447 thousand and $223,572 thousand, respectively.

11. INVENTORIES

Finished goods Work in progress Raw materials Supplies		December 31	December 31
		2021 $ 129,219 35,943 193,919 23,651 $ 382,732	2020 $ 59,157 20,198 120,712 19,912 $ 219,979

The cost of inventories recognized as cost of goods sold for the years ended December 31, 2021 and 2020 was $1,899,781 thousand and $1,564,853 thousand, respectively. The inventory write-downs was $559 thousand and $267 thousand, respectively.

12. NON-CURRENT ASSETS CLASSIFIED AS HELD FOR SALE

The Group’s subsidiary, Jinan Acetate Chemical, signed the expropriation contract with Jinan Prior Zone For Replacing Old Growth with New Zones Management Committee Construction Management Department on August 17, 2021. The investment properties with the right of use assets and buildings, which located in Qingning area, was reclassified as non-current assets held for sale.

Non-current assets held for sale

Freehold land held for sale Equity directly associated with non-current assets classified as held for sale		December 31	December 31
		2021 $ 101,128 $ 65,146	2020 $ - $ -

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Investment properties measured at fair value

Balance at January 1, 2021 Effects of foreign currency exchange differences Balance at December 31, 2021	Total $ 101,897 (769) $ 101,128

The fair values of investment properties were measured on a recurring basis as follows:

Independent valuation		December 31	December 31
		2021 $ 101,128	2020 $ -

The fair values of a single investment property with a carrying amount at least 20% of the paid-in capital at December 31, 2021 by independent qualified professional valuer, Mr. Ming-Hun Tsai, from Zhan-Mao Real Estate Appraisal Firm in the ROC.

The movements in the fair value of investment properties within Level 3 of the hierarchy were as follows:

Balance at January 1, 2021 Recognized in other comprehensive income (exchange differences on translating the financial statements of foreign operations) Balance at December 31, 2021	Total $ 101,897 (769) $ 101,128

The fair value of investment properties, except for undeveloped land, was measured using the income approach. The significant assumptions used are as follows:

		December 31,
		2021
Expected	future cash inflows	$ 216,904
Expected	future cash outflows	(8,483)
Expected	future cash inflows, net	$ 208,421
Discount	rates	5.44%

The market rentals in the area where the investment property is located were between RMB7.758 per square meter. The market rentals for comparable properties were between RMB7 and RMB9 per square meter.

The investment property has 1 floor above ground level, and the floor had been leased out under operating leases. The rental income generated for the years ended December 31, 2021 was $4,289 thousand.

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The future cash inflows expected 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 rate, 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 time deposit interest rate for 1-year period; there was no disposal value since after the land lease expires, no land owner will be paid back the above-ground houses. The expected future cash outflows incurred by investment properties included the expenditures such as enterprise-establishing brokerage fee, related taxes and management costs, insurance premiums and maintenance costs. These expenditures were extrapolated on the basis of the current level of expenditures, taking into account the future adjustments.

The discount rate of 5.44% was determined using the interest rate for 1-year time deposits as posted by The People’s Bank of China of 1.75% and long-term interest rate of 4.75% for the year ended December 31, 2021. The discount rate was first calculated by using 50% of funds and borrowing for capitalization rate of 3.215%, then calculated by liquidity, risk, appreciation and the difficulty on management.

13. SUBSIDIARIES

a. Entities included in the consolidated financial statements:

Investor Investee Nature of Activities The Company My Parents Living Technology Limited (Hong Kong) (“My Parents”) Investments My Parents Jinan Acetate Chemical Co., Ltd. (China) (“Jinan Acetate Chemical”) Production and sales of cellulose acetate tow Jinan Acetate Chemical Acetek Material Co., Ltd. (China) (“Acetek Material”) Production and sales of cellulose acetate My Parents Acetek Material Co., Ltd. (China) (“Acetek Material”) Production and sales of cellulose acetate My Parents Acetek Chemical Co., Ltd. (China) (“Acetek Chemical”) Investments Jinan Acetate Chemical Acetek Momentun Co., Ltd. (China) (“Acetek Momentun”) Manufacturing and sales of cellulose anhydride My Parents Acetek Momentun Co., Ltd. (China) (“Acetek Momentun”) Manufacturing and sales of cellulose anhydride My Parents Acetate (Shandong) Environmental Fiber Co., Ltd. (China) (“Acetek Environmental”) Manufactruing and sales of cellulose acetate fiber	Proportion of Ownership
	December 31
	2021 2020 100.00 100.00 100.00 100.00 80.00 (Note 2) 52.80 - (Note 2) 27.20 80.00 80.00 71.35 43.01 (Note 1) 28.65 56.99 (Note 1) 100.00 (Note 3)

Investor
Investee
Nature of Activities
The Company
My Parents Living Technology Limited
(Hong Kong) (“My Parents”)
Investments
My Parents
Jinan Acetate Chemical Co., Ltd.
(China) (“Jinan Acetate Chemical”)
Production and sales of
cellulose acetate tow
Jinan Acetate Chemical Acetek Material Co., Ltd. (China)
(“Acetek Material”)
Production and sales of
cellulose acetate
My Parents
Acetek Material Co., Ltd. (China)
(“Acetek Material”)
Production and sales of
cellulose acetate
My Parents
Acetek Chemical Co., Ltd. (China)
(“Acetek Chemical”)
Investments
Jinan Acetate Chemical Acetek Momentun Co., Ltd. (China)
(“Acetek Momentun”)
Manufacturing and sales
of cellulose anhydride
My Parents
Acetek Momentun Co., Ltd. (China)
(“Acetek Momentun”)
Manufacturing and sales
of cellulose anhydride
My Parents
Acetate (Shandong) Environmental
Fiber Co., Ltd. (China)
(“Acetek Environmental”)
Manufactruing and sales
of cellulose acetate
fiber

Proportion of Ownership

**December 31 **

2021
2020
100.00
100.00
100.00
100.00
80.00
(Note 2)
52.80
-
(Note 2)
27.20
80.00
80.00
71.35
43.01
(Note 1)
28.65
56.99
(Note 1)
100.00
(Note 3)

Note 1: The Group invested in Acetek Momentun in July 2020 by Jinan Acetate Chemical and December 2020 by My Parents.
Note 2: My Parents transferred shares of Acetek Material 27.2% to Jinan Acetate Chemical in November 2021.

Note 3: The Group invested in Acetate (Shandong) Environmental Fiber Co., Ltd. in October 2021.

b. Details of subsidiaries that have material non-controlling interests

Details of subsidiaries that have material non-controlling interests
Name of Subsidiary Principal Place of Business Acetek Material Mainland China	Proportion of Ownership and Voting Rights Held by Non-controlling Interests
	December 31
	2021 2020 20.00% 20.00%

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Summarized financial information in respect of Acetek Material that has material non-controlling interests is set out below. The summarized financial information below represents amounts before intragroup eliminations.

Current assets Non-current assets Current liabilities Equity Equity attributable to: Owners of the Company Non-controlling interests of Acetek Material Revenue Profit for the year Other comprehensive income for the year Total comprehensive income for the year Profit attributable to: Owners of the Company Non-controlling interests of Acetek Material Total comprehensive income attributable to: Owners of the Company Non-controlling interests of Acetek Material Net cash inflow from: Operating activities Investing activities Financing activities Effects of exchange rate changes Net cash inflow (outflow)			December 31	December 31
	2021 2020 $ 387,249 $ 329,960 834,030 788,039 (660,045) (562,697) $ 561,234 $ 555,302 $ 448,987 $ 444,242 112,247 111,060 $ 561,234 $ 555,302 For the Year Ended December 31
		2021 $ 1,299,586 $ 10,112 (7,878) $ 2,234 $ 8,090 2,022 $ 10,112 $ 1,787 447 $ 2,234 $ 127,125 (128,979) 2,172 1,395 $ 1,713		2020 $ 1,029,941 $ 23,184 (20,385) $ 2,799 $ 18,547 4,637 $ 23,184 $ 2,239 560 $ 2,799 $ (91,282) (99,775) 175,080 7,861 $ (8,116)

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14. PROPERTY, PLANT AND EQUIPMENT

Cost Balance at January 1, 2020 Additions Disposals Reclassification Effect of foreign currency exchange differences Balance at December 31, 2020 Accumulated depreciation Balance at January 1, 2020 Depreciation expenses Disposals Effect of foreign currency exchange differences Balance at December 31, 2020 Carrying amounts at December 31, 2020 Cost Balance at January 1, 2021 Additions Disposals Reclassification Effect of foreign currency exchange differences Balance at December 31, 2021 Accumulated depreciation Balance at January 1, 2021 Depreciation expenses Disposals Effect of foreign currency exchange differences Balance at December 31, 2021 Carrying amounts at December 31, 2021	Buildings $ 222,273 9,165 - 591 3,934 $ 235,963 $ 56,385 11,598 - 1,200 $ 69,183 $ 166,780 $ 235,963 39,856 - 2,056 (1,750) $ 276,125 $ 69,183 13,646 - (512) $ 82,317 $ 193,808	Equipment Transportation Equipment $ 1,070,574 $ 11,124 50,654 - - (478 ) 30,597 287 19,708 182 $ 1,171,533 $ 11,115 $ 433,248 $ 6,729 88,361 1,752 - (454 ) 9,206 141 $ 530,815 $ 8,168 $ 640,718 $ 2,947 $ 1,171,533 $ 11,115 383,533 1,390 (2,753 ) - 81,772 476 (8,513) (83) $ 1,625,572 $ 12,898 $ 530,815 $ 8,168 115,552 1,420 (2,491 ) - (3,924) (61) $ 639,952 $ 9,527 $ 985,620 $ 3,371	Other Equipment Construction in Progress Equipment $ 7,249 $ 15,229 - 81,189 - - - (12,803 ) 120 1,771 $ 7,369 $ 85,386 $ 3,382 $ - 1,409 - - - 88 - $ 4,879 $ - $ 2,490 $ 85,386 $ 7,369 $ 85,386 - - - - 43 (3,138 ) (56) (702) $ 7,356 $ 81,546 $ 4,879 $ - 1,434 - - - (36) - $ 6,277 $ - $ 1,079 $ 81,546	Total $ 1,326,449 141,008 (478 ) 18,672 25,715 $ 1,511,366 $ 499,744 103,120 (454 ) 10,635 $ 613,045 $ 898,321 $ 1,511,366 424,779 (2,753 ) 81,209 (11,104) $ 2,003,497 $ 613,045 132,052 (2,491 ) (4,533) $ 738,073 $ 1,265,424

The above items of property, plant and equipment are depreciated on a straight-line basis over their estimated useful lives as follows:

Buildings 20 years Equipment 3-10 years Transportation equipment 4-5 years Other equipment 5 years

Property, plant and equipment pledged as collateral for bank borrowings are set out in Note 30.

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15. LEASE ARRANGEMENTS

a. Right-of-use assets

Carrying amount Land Additions to right-of-use assets Depreciation charge for right-of-use assets Land		December	31
	2021 2020 $ 77,960 $ 53,811 For the Year Ended December 31
		2021 $ 26,662 $ 2,513	2020 $ - $ 2,256

b. Material leasing activities and terms

As lessees, Jinan Acetek Chemical Co., Ltd. and Acetek Material Co., Ltd. are leasing certain lands for the use of factory with lease terms of 20 to 30 years. These arrangements do not contain purchase options at the end of the lease terms.

c. Other lease information

Other lease information
Expenses relating to short-term leases Expenses relating to low-value asset leases Total cash outflow for leases	For the Year Ended December 31 2021 2020 $ 707 $ 433 $ 13 $ 14 $ (720) $ (447)
		2021 $ 707 $ 13 $ (720)	2020 $ 433 $ 14 $ (447)

The Group leases of certain office equipment qualify as short-term leases and leases of certain computer equipment which qualify as low-value asset leases. The Group has elected to apply the recognition exemption and thus, did not recognize right-of-use assets and lease liabilities for these leases.

16. INVESTMENT PROPERTIES

INVESTMENT PROPERTIES
Measured at fair value		December 31
		2021 $ -	2020 $ 101,897

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The maturity analysis of lease payments receivable under operating leases of investment properties at December 31, 2020 was as follows:

December 31, 2020 was as follows:
	December 31,
		2020
Year 1	$	4,473
Year 2		4,473
Year 3		4,696
Year 4		4,696
Year 5		4,931
Year 6 onwards		4,931
	$	28,200
Investment properties measured at fair value
		Total
Balance at January 1, 2020	$	100,220
Effects of foreign currency exchange differences		1,677
Balance at December 31, 2020	$	101,897

The fair values of investment properties were measured on a recurring basis as follows:

Independent valuation		December 31	December 31
		2021 $ -	2020 $ 101,897

The fair values of a single investment property with a carrying amount at least 20% of the paid-in capital at December 31, 2020 was based on the valuations carried out on January 28, 2021, respectively, by independent qualified professional valuer, Mr. Ming-Hun Tsai, from Zhan-Mao Real Estate Appraisal Firm in the ROC.

The movements in the fair value of investment properties within Level 3 of the hierarchy were as follows:

Balance at January 1, 2020 Recognized in other comprehensive income (exchange differences on translating the financial statements of foreign operations) Balance at December 31, 2020	Total $ 100,220 1,677
	$ 101,897

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The fair value of investment properties, except for undeveloped land, was measured using the income approach. The significant assumptions used are as follows:

		December 31,
		2020
Expected	future cash inflows	$ 217,877
Expected	future cash outflows	(8,342)
Expected	future cash inflows, net	$ 209,535
Discount	rates	5.38%

The investment property has 1 floor above ground level, and the floor had been leased out under operating leases. The rental income generated for the years ended December 31, 2020 was $4,289 thousand.

The discount rate of 5.38% was determined using the interest rate for 1-year time deposits as posted by The People’s Bank of China of 1.75% and long-term interest rate of 4.75% for the year ended December 31, 2020. The discount rate was first calculated by using 50% of funds and borrowing for capitalization rate of 3.215%, then calculated by liquidity, risk, appreciation and the difficulty on management.

The Group has free hold interests in all of its investment properties. The investment properties pledged as collateral for bank borrowings are set out in Note 30.

17. OTHER ASSETS

OTHER ASSETS
Current Prepayments Advanced payments Prepayment Others		December 31
		2021 $ 72,645 78,289 72,003 $ 222,937	2020 $ 26,384 13,177 24,421 $ 63,982 (Continued)

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Other current assets Pledge deposits Refundable deposits Non-current Other non-current assets Prepayments for equipment Refundable deposits Prepayments for house		December 31	December 31
		2021 $ 142,878 434 $ 143,312 $ 77,443 27 - $ 77,470	2020 $ 91,441 877 $ 92,318 $ 81,940 27 10 $ 81,977 (Concluded)

18. BORROWINGS

Short-term Borrowings

Short-term Borrowings
Secured borrowings Bank loans Unsecured borrowings Line of credit borrowings		December 31
		2021 $ 2,172 487,244 $ 489,416	2020 $ - 56,960 $ 56,960

The range of interest rates on bank loans was 0.95%-4.35% and 0.85%-1.05% per annum at December 31, 2021 and 2020, respectively.

Long-term Borrowings

Long-term Borrowings
Unsecured borrowings Line of credit borrowings Less: Current portion Long-term borrowings		December	31
		2021 $ 83,040 (41,520) $ 41,520	2020 $ - - $ -

The Group obtained a new bank loan of US$3,000 thousands with interest rates 1.56%. The interest was paid monthly and the loan was amortized quarterly.

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19. BONDS PAYABLE

BONDS PAYABLE
First-time unsecured domestic convertible bonds (ROC) Second-time unsecured domestic convertible bonds (ROC) Less: Current portion		December 31
		2021 $ 349,167 530,796 879,963 (349,167) $ 530,796	2020 $ 473,921 513,646 987,567 (473,921) $ 513,646

As of June 9, 2017, the Company issued $500,000 thousand, 0% NTD-denominated unsecured convertible bonds in Taiwan, with a total issue amount of $500,000 thousand.

Each bond entitles the holder to convert it into ordinary shares of the Company at a conversion price of $173. In case of ex-right or ex-dividend, the price should be adjusted according to the conversion price adjustment formula. The conversion price as of December 31, 2021 was $113.6. Conversion may occur at any time between September 10, 2017 and June 9, 2022. If the bonds have not been converted and the closing price of ordinary shares has exceeded 30% of the current conversion price for 30 consecutive business days, the Company may send a copy of “Debt Rebate Notice” with expiration of one month by registered mail within the next 30 business days. The aforementioned period is calculated from the delivery of mail, and the expiration date of the period is determined as the base date for recovery of bonds. The Company redeems the bonds at their par value within 5 business days following the base date.

The convertible bonds shall be resold in advance by bondholders on the date of the issuance of 3 years (June 9, 2020) and the date of the issuance of 4 years (June 9, 2021). The Company should send a copy of “Notice of Put Provision” to the bondholders by registered mail in 40 days before the base date of resale. The bondholders may require the Company to add interest compensation to the par value of the bonds (101.5075% for 3 years and 102.0151% for 4 years) and to redeem the bonds in cash. Upon receiving the request for resale, the Company shall redeem the bonds in cash within 5 business days after the resale date.

Proceeds from issuance (less transaction costs of $4,499 thousand)

Liability component at the date of issue

Liability component at January 1, 2020 (bonds payable of $456,564 thousand and
financial liabilities at fair value through profit or loss - non-current of $46,400
thousand)

Interest charged at an effective interest rate of 3.7371%
Valuation profit on financial investments

Liability component at December 31, 2020 (bonds payable of $473,921 thousand and
financial liabilities at fair value through profit or loss - current of $21,450 thousand)

Liability component at January 1, 2021 (bonds payable of $473,921 thousand and
financial liabilities at fair value through profit or loss - current of 21,450 thousand)

Interest charged at an effective interest rate of 3.7371%
Valuation profit on financial investments
Redeemed convertible bonds

Liability component at December 31, 2021 (bonds payable of $349,167 thousand and
financial liabilities at fair value through profit or loss - current of $2,591 thousand)

$ 500,501
$ 500,501
$ 502,864
17,357

(24,850)
$ 495,371
$ 495,371
15,031
(13,490)
(145,154)
$ 351,758

As of September 25, 2020, the Company issued $600,000 thousand, 0% NTD-denominated unsecured convertible bonds in Taiwan, with a total issue amount of $600,000 thousand.

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Each bond entitles the holder to convert it into ordinary shares of the Company at a conversion price of $130.7. In case of ex-right or ex-dividend, the price should be adjusted according to the conversion price adjustment formula. The conversion price as of December 31, 2021 was $108.4. Conversion may occur at any time between December 26, 2020 and September 25, 2025. If the bonds have not been converted and the closing price of ordinary shares has exceeded 30% of the current conversion price for 30 consecutive business days, the Company may send a copy of “Debt Rebate Notice” with expiration of one month by registered mail within the next 30 business days. The aforementioned period is calculated from the delivery of mail, and the expiration date of the period is determined as the base date for recovery of bonds. The Company redeems the bonds at their par value within 5 business days following the base date.

The convertible bonds shall be resold in advance by bondholders on the date of the issuance of 3 years (September 25, 2023) and the date of the issuance of 4 years (September 25, 2024). The Company should send a copy of “Notice of Put Provision” to the bondholders by registered mail in 40 days before the base date of resale. The bondholders may require the Company to add interest compensation to the par value of the bonds (100.75% for 3 years and 101.00% for 4 years) and to redeem the bonds in cash. Upon receiving the request for resale, the Company shall redeem the bonds in cash within 5 business days after the resale date.

Proceeds from issuance (less transaction costs of $4,584 thousand)

Liability component at the date of issue

Liability component at September 25, 2020 (bonds payable of $509,136 thousand and
financial liabilities at fair value through profit or loss - non-current of $92,280
thousand)

Interest charged at an effective interest rate of 3.2888%
Valuation profit on financial investments

Liability component at December 31, 2020 (bonds payable of $513,646 thousand and
financial liabilities at fair value through profit or loss - non-current of $61,140
thousand)

Liability component at January 1, 2021 (bonds payable of $513,646 thousand and
financial liabilities at fair value through profit or loss - non-current of $61,140
thousand)

Interest charged at an effective interest rate of 3.2888%
Valuation profit on financial investments

Liability component at December 31, 2021 (bonds payable of $530,767 thousand and
financial liabilities at fair value through profit or loss - non-current of $43,380
thousand)

$ 601,416
$ 601,416
$ 601,416
4,510

(31,140)
$ 574,786
$ 574,786
17,150

(17,760)
$ 574,176

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20. OTHER PAYABLES

OTHER PAYABLES
Payables for purchases of equipment Payables for security production fee Payables for steam fee Payables for salaries Payables for commission Payables for freight Accrued remuneration to employees and directors Others		December 31
		2021 $ 89,689 35,034 24,828 18,378 14,719 5,879 5,631 22,314 $ 216,472	2020 $ 34,969 28,553 23,801 19,165 16,327 18,320 6,122 9,639 $ 156,896

21. RETIREMENT BENEFIT PLANS

Jinan Acetate Chemical and Acetek Material of the Group adopted a defined contribution plan. Under the plan, an entity makes contributions to employees’ pension account at percentages of the salary of employees. The pension account is managed by the authorized insurance institution located in China. The employees can withdraw the pension contributed by the Company and by themselves as well as the interest upon retirement.

22. EQUITY

a. Ordinary shares

Ordinary shares
Number of shares authorized (in thousands) Shares authorized Number of shares issued and fully paid (in thousands) Shares issued		December 31
		2021 100,000 $ 1,000,000 58,576 $ 585,756	2020 100,000 $ 1,000,000 51,077 $ 510,767

On April 15, 2021, the Company’s board of directors resolved to issue 7,499 thousand ordinary shares from capital surplus with a par value of $10, of which increased the share capital issued. On April 23, 2021, the Company’s board of director resolved May 29, 2021 as share capital increase base date and fully paid to $585,756 thousand.

On November 11, 2021, the Company’s board of directors resolved to cancel 513 thousand revaluation surplus, which was the overdue portion for the purpose of transfer to employees, will regarded as unissued shares. On January 8, 2022, as share capital reduction base date.

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b. Capital surplus

Capital surplus
May be used to offset a deficit, distributed as cash dividends, or transferred to share capital (1) Issuance of ordinary shares May be used to offset a deficit only Changes in percentage of ownership interest in subsidiary (2)		December 31
		2021 $ 416,034 17,541 $ 433,575	2020 $ 416,034 17,541 $ 433,575

1) Such capital surplus may be used to offset a deficit; in addition, when the Company has no deficit, such capital surplus may be distributed as cash dividends or transferred to share capital (limited to a certain percentage of the Company’s capital surplus and once a year).
2) Such capital surplus arises from the effect of changes in ownership interest in a subsidiary that resulted from equity transactions other than actual acquisition.
c. Retained earnings and dividend policy

The Company is in the growing stage. According to the Articles of Incorporation, the board of directors should propose the distribution of shareholders’ dividends and submit it to the shareholders’ meeting for appropriations of earnings, only after taking into consideration the Company’s earnings, overall development, financial planning, capital requirements, industry outlook and future prospects of the Company for each of the fiscal year.

During the period when the shares are listed or traded in Taipei Exchange or Taiwan Stock Exchange, the board of directors when making proposal for distribution of earnings shall first appropriate the earnings in each fiscal year as follows: (i) reserve for tax of the relevant fiscal year; (ii) amount to offset past losses; (iii) from the remaining amount, 10% for legal reserve; and (iv) special reserve required by the securities authorities of the Republic of China in accordance with the rules of a public company. For the policies on the distribution of employees’ compensation and remuneration of directors and supervisors after the amendment, refer to employees’ compensation and remuneration of directors and supervisors in Note 24-h.

After considering the financial, business and operational factors, according to the Cayman Company Law and the Public Company Rules, all or parts of the unappropriated earnings accumulated in previous years, plus no less than 10% of the after-tax earnings in the current year, can be distributed as shareholders’ dividends according to the shareholding ratio. Shareholders’ dividends are distributed as stock dividends, cash dividends, or both; cash dividends must not be less than 10% of total dividends.

Appropriation of earnings to legal reserve shall be made until the legal reserve equals the Company’s paid-in capital. The legal reserve may be used to offset deficits. If the Company has no deficit and the legal reserve has exceeded 25% of the Company’s paid-in capital, the excess may be transferred to capital or distributed in cash.

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The appropriations of earnings for 2020 and 2019 approved in the shareholders’ meetings on April 15, 2021 and June 23, 2020, respectively, were as follows:

2021 and June 23, 2020, respectively, were as follows:
Legal reserve Special reserve Cash dividends Share dividends Cash dividends per share (NT$) Share dividends per share (NT$)	Appropriation of Earnings
	For the Year Ended		December 31
		2020 $ 50,456 $ (15,390) $ 274,960 $ 74,989 $ 5.5 $ 1.5	2019 $ 32,968 $ 57,195 $ 237,649 $ - $ 4.7 $ -

The issue new shares through capital increase from earning in 2021 has affected the number of outstanding shares. Therefore, the Group adjusted the cash dividends distribution rate in 2020 from 5.5 per share to 4.78 per share.

d. Special reserves

Special reserves
Beginning at January 1 Appropriations in respect of Debits to other equity items Appropriations in respect of Debits to other equity items Balance at December 31	For the Year Ended December 31
		2021 $ 78,601 - (15,390) $ 63,211	2020 $ 21,406 57,195 - $ 78,601

On the initial application of the fair value model to investment properties, the Company appropriated to retained earnings a special reserve in the amount of $2,344 thousand that was the same as the net increase in the fair value. Additional special reserve should be appropriated for the amount equal to the difference between net debit balance reserves and the special reserve appropriated on the first-time adoption of IFRSs. Any special reserve appropriated may be reversed to the extent that the net debit balance reverses and is thereafter distributed.

e. Non-controlling interests

Balance at January 1 Share in profit (loss) for the year Other comprehensive loss during the year Exchange differences on translating the financial statements of foreign entities Unrealized loss on financial assets at FVTOCI Balance at December 31	For the Year Ended	For the Year Ended	December 31
		2021 $ 119,128 2,699 (897) (315) $ 120,615	2020 $ 113,380 5,023 1,981 (1,256) $ 119,128

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f. Treasury shares

Treasury shares
	Shares
	Transferred to
	Employees
	(In Thousands
Purpose of Buy-back	of Shares)
Number of shares at January 1, 2021	1,084
Increase during the year	382
Number of shares at December 31, 2021	1,466
Number of shares at January 1, 2020	513
Increase during the year	571
Number of shares at December 31, 2020	1,084

Under the Securities and Exchange Act, the Company shall neither pledge treasury shares nor exercise shareholders’ rights on these shares, such as the rights to dividends and to vote.

23. REVENUE

REVENUE
Revenue from contracts with customers Revenue from sale of goods	For the Year Ended December 31
		2021 $ 2,714,866	2020 $ 2,353,380

a. Contract information

The goods are sold at the fair value of the consideration received or receivable. The Company eliminates the estimated customer returns, discounts and other similar discounts from the amount of goods sold to determine the revenue from sale of goods.

b. Contract balances

December 31, 2021 December 31, 2020 Accounts receivables (Note 10) $ 444,018 $ 661,465 Contract liabilities - current $ 126,900 $ 47,573	January 1, 2020 $ 437,893 $ 16,450

c. Disaggregation of revenue

Refer to Note 36 for information about disaggregation of revenue.

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24. NET PROFIT

a. Other income

For the Year Ended	For the Year Ended	December 31
2021 $ 25,453 4,480 1,056 $ 30,989 For the Year Ended		2020 $ 17,378 4,289 27,410 $ 49,077 December 31
2021 $ (28,559) (223) (2,945) $ (31,727) For the Year Ended		2020 $ (2,635) (22) (623) $ (27,010) December 31
2021 $ 32,181 2,892 $ 35,073 For the Year Ended		2020 $ 21,867 3,993 $ 25,860 December 31
2021 $ 2,247 For the Year Ended		2020 $ 1,778 December 31
	2021 $ 132,052 2,513 $ 134,565 $ 128,311 6,254 $ 134,565	2020 $ 103,120 2,256 $ 105,376 $ 97,260 8,116 $ 105,376

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f. Operating expenses directly related to investment properties

Direct operating expenses of investment properties generating Rental income Employee benefits expense Short-term benefits Post-employment benefits Other employee benefits Total employee benefits expense An analysis of employee benefits expense by function Operating costs Operating expenses	For the Year Ended	For the Year Ended	December 31
	2021 $ 413 For the Year Ended		2020 $ 539 December 31
		2021 $ 109,385 8,733 4,206 $ 122,324 $ 73,666 48,658 $ 122,324	2020 $ 93,647 826 4,002 $ 98,475 $ 52,954 45,521 $ 98,475

g. Employee benefits expense

h. Employees’ compensation and remuneration of directors and supervisors

According to the Articles of Incorporation of the Company, the Company accrues employees’ compensation at a rate of no less than 1% when the Company earned profits in the year. Employees’ compensation is paid to employees of subordinate companies that meet certain conditions. When the

Company is able to increase the amount of profit, it accrues directors’ remuneration at a rate of no more than 3% of the profit of the year. However, if the Company has accumulated losses, it should first retain the amount to offset the losses before accruing employees’ and directors’ remuneration in accordance with the above-mentioned proportion. The aforementioned profit refers to the Company’s pre-tax net profit. To avoid confusion, the pre-tax net profit refers to the amount before the accrual for employees and directors’ remuneration.

The employees’ compensation and the remuneration of directors for the years ended December 31, 2021 and 2020, which were approved by the Company’s board of directors on March 9, 2022 and March 5, 2021, respectively, were as follows:

Accrual rate

Accrual rate
Employees’ compensation Remuneration of directors	For the Year Ended December 31
	2021 2020 1.00% 1.00% 0.55% 0.20%

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Amount

Amount
Employees’ compensation Remuneration of directors	For the Year Ended December 31
	2021 Cash $ 3,631 2,000	2020
		Cash $ 5,122 1,000

If there is a change in the proposed amounts after the annual consolidated financial statements are authorized for issue, the differences are recorded as a change in accounting estimate in the subsequent period.

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, 2020 and 2019.

Further information on the employees’ compensation and remuneration of directors approved in the meetings of the board of directors is available at the “Market Observation Post System” website of the TSE.

i. Gains or losses on foreign currency exchange

Gains or losses on foreign currency exchange
Foreign exchange gains Foreign exchange losses Net loss	For the Year Ended December 31
		2021 $ 4,357 (32,916) $ (28,559)	2020 $ 43,242 (69,607) $ (26,365)

25. INCOME TAXES

a. Income tax expense recognized in profit or loss

Income tax expense recognized in profit or loss
Current tax In respect of the current year Adjustments for prior year Deferred tax In respect of the current year Adjustments for prior year Income tax expense recognized in profit or loss	For the Year Ended December 31
		2021 $ (24,675) 9,309 12,130 (2,009) $ (5,245)	2020 $ (44,944) (10,247) 6,568 5,354 $ (43,269)

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A reconciliation of accounting profit and income tax expense is as follows:

Profit before income tax Income tax expense calculated at the statutory rate Research and development credits Nondeductible expenses in determining taxable income Tax-exempt income Adjustments for prior years’ tax Others Income tax expense recognized in profit or loss	For the Year Ended	For the Year Ended	December 31
		2021 $ 365,444 $ (55,456) 42,315 (240) 638 7,300 198 $ (5,245)	2020 $ 552,850 $ (75,302) 35,384 (366) 2,310 (4,893) (402) $ (43,269)

b. Current tax assets and liabilities

Current tax assets and liabilities
Current tax assets Tax refund receivable		December	31
		2021 $ 6,141	2020 $ 3,628

c. Deferred tax assets and liabilities

The movements of deferred tax assets and deferred tax liabilities are as follows:

For the year ended December 31, 2021

Deferred tax assets Temporary differences Allowance for inventory valuation and obsolescence loss Unrealized compensation FVTPL financial liabilities Payables for security production fee Tax losses Deferred tax liabilities Temporary differences Unrealized revaluation increments FVTPL financial assets	Opening Balance Recognized in Profit or Loss Exchange Differences $ 72 $ 90 $ - 230 20 (2) 53 (52) (1) 29,450 11,436 (214) 4,275 (1,267) (34) $ 34,080 $ 10,227 $ 251 $ 9,577 $ - $ (72) - 106 (1) $ 9,577 $ 106 $ (73)	Closing Balance $ 162 248 - 40.672 2,974 $ 44,056 $ 9,505 105 $ 9,610

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For the year ended December 31, 2020

Deferred tax assets Temporary differences Allowance for inventory valuation and obsolescence loss Unrealized compensation FVTPL financial assets Payables for security production fee Tax losses Deferred tax liabilities Temporary differences Unrealized revaluation increments	Opening Balance Recognized in Profit or Loss Exchange Differences $ 35 $ 36 $ 1 534 (306) 2 - 51 2 20,964 7,958 528 - 4,183 92 $ 21,533 $ 11,922 $ 625 $ 9,420 $ - $ 157	Closing Balance $ 72 230 53 29,450 4,275 $ 34,080 $ 9,577

d. Income tax declarations

The income tax declarations of Jinan Acetate Chemical and Acetek Material of the Group have been completed within the deadlines set by the local tax collection office.

26. 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
		2021 $ 6.23 $ 5.32	2020 $ 8.75 $ 8.67

The weighted average number of ordinary shares outstanding used for the earning per share computation was adjusted retroactively for issuance of bonus shares on May 29, 2021. The basic and diluted earning per share adjusted retroactively for the year ended December 31, 2020 were as follows.

	Before	After
	Retrospective	Retrospective
	Adjustment	Adjustment
Basic earnings per share	$ 10.07	$ 8.75
Diluted earnings per share	$ 9.87	$ 8.67

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Net Profit for the Year

Profit for the year attributable to owners of the Company Effect of potentially dilutive ordinary shares Interest and evaluation of convertible bonds Earning used in the computation of diluted earnings per share	For the Year Ended	For the Year Ended	December 31
		2021 $ 357,500 930 $ 358,430	2020 $ 504,558 35,650 $ 540,208

Number of Shares

Weighted average number of ordinary shares used in the computation of basic earnings per share Effect of potentially dilutive ordinary shares Convertible bonds Employees’ compensation or bonuses issued to employees Weighted average number of ordinary shares used in the computation of diluted earnings per share	Unit: Thousand Shares For the Year Ended December 31	Unit: Thousand Shares For the Year Ended December 31	Unit: Thousand Shares For the Year Ended December 31
		2021 57,407 9,936 42 67,385	2020 57,640 4,591 42 62,273

If the Group offered to settle the compensation or bonuses paid to employees in cash or shares, then the Group should assume that the entire amount of the compensation or bonuses will be settled in shares, and the resulting potential shares are included in the weighted average number of shares outstanding used in the computation of diluted earnings per share, if the effect is dilutive. 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.

27. CAPITAL MANAGEMENT

The Group manages its capital to ensure that it has the necessary financial resources and operating plans to meet the working capital, capital expenditure and debt repayment requirements for the next 12 months, and that entities in the Group will be able to continue as going concerns while maximizing the return to stakeholders through the optimization of the debt and equity balance.

Key management personnel of the Group review the capital structure on a regular 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, the number of new shares issued or repurchased, and/or the amount of new debt issued or existing debt redeemed.

28. FINANCIAL INSTRUMENTS

a. Fair value of financial instruments that are not measured at fair value

In the management’s opinion, the carrying value of financial instruments that are not measured at fair value approximates the fair value of the financial instruments.

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b. Fair value of financial instruments that are measured at fair value on a recurring basis
1) Fair value hierarchy

December 31, 2021 Level 1 Level 2 Level 3 Financial assets at FVTPL Held for trading $ - $ 697 $ - Financial assets at FVTOCI Investments in equity instruments $ - $ - $ 24,055 Financial liabilities at FVTPL Held for trading $ - $ 45,971 $ - December 31, 2020 Level 1 Level 2 Level 3 Financial assets at FVTOCI Investments in equity instruments $ - $ - $ 25,829 Financial liabilities at FVTPL Held for trading $ - $ 82,938 $ - There were no transfers between Levels 1 and 2 for the years ended December 31, Reconciliation of Level 3 fair value measurements of financial instruments For the year ended December 31, 2021 Financial Assets Balance at January 1, 2021 Recognized in profit or loss (included in other gains and losses) Recognized in other comprehensive income (included in unrealized loss on investments in equity instruments at FVTOCI) Balance at December 31, 2021	Level 3 $ -	Total $ 697 $ 24,055 $ 45,971 Total $ 25,829 $ 82,938 2021 and 2020. Financial Assets at FVTOCI
	$ 24,055
	$ -
	Level 3 $ 25,829
	$ -
		Equity Instruments $ 25,829 (196) (1,578) $ 24,055

2) Reconciliation of Level 3 fair value measurements of financial instruments
46 -

For the year ended December 31, 2020

For the year ended December 31, 2020
Financial Assets Balance at January 1, 2020 Recognized in profit or loss (included in other gains and losses) Recognized in other comprehensive income (included in unrealized loss on investments in equity instruments at FVTOCI) Balance at December 31, 2020	Financial Assets at FVTOCI
	Equity Instruments $ 31,716 391 (6,278) $ 25,829

3) Valuation techniques and inputs applied for Level 2 fair value measurement

Financial Instruments
Convertible bonds
Derivatives - foreign exchange
forward contracts

Valuation Techniques and Inputs

The convertible bonds are assumed to be redeemed on June 9,
2022 and September 25, 2025, and the discount rate is
calculated by the 5-year public bond yield by the differential
method.
Discounted cash flow.
Future cash flows are estimated based on observable forward
exchange rates at the end of the year and contract forward
rates, discounted at a rate that reflects the credit risk of
various counterparties.

4) Valuation techniques and inputs applied for Level 3 fair value measurement

The fair values of unlisted equity securities - ROC were determined using the income approach. In this approach, the discounted cash flow method was used to capture the present value of the expected future economic benefits to be derived from the ownership of these investees.

c. Categories of financial instruments

Financial assets Financial assets at amortized cost (Note 1) Financial assets at FVTOCI Equity instruments Financial assets at FVTPL Financial liabilities Financial liabilities at amortized cost (Note 2) Financial liabilities at FVTPL	December 31
	2021 2020 $ 1,432,617 $ 1,625,587 24,055 25,829 697 - 1,768,956 1,359,777 45,971 82,938

1) The balances include financial assets at amortized cost, which comprise cash and cash equivalents, notes receivable and accounts receivable, accounts receivable for related parties, other receivables, other current assets (pledged deposits) and refundable deposits.
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2) The balances include financial liabilities at amortized cost, which comprise short-term borrowings, notes payable, accounts and other payables, bonds issued, guarantee deposit received, current portion of long-term borrowings and long-term borrowings.
d. Financial risk management objectives and policies

The Group’s major financial instruments include cash and cash equivalents, debt investments, accounts receivable, borrowings, accounts payable and bonds payable. 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 seeks to minimize 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 board of directors, which provided 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. The Group did not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.

1) Market risk

The Group’s activities exposed it primarily to the financial risks of changes in foreign currency exchange rates (see (a) below) and interest rates (see (b) below).

There has been no change to the Group’s exposure to market risks or the manner in which these risks are managed and measured.

a) Foreign currency risk

Several subsidiaries have foreign currency sales and purchases, which exposes the Group to foreign currency risk. Exchange rate exposures are managed within approved policy parameters utilizing foreign exchange forward contracts.

The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities (including those eliminated on consolidation) and of the derivatives exposed to foreign currency risk at the end of the reporting period are set out in Notes 7 and 34.

Sensitivity analysis

The Group is mainly exposed to the USD.

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The following table details the Group’s sensitivity to a 1% increase and decrease in the RMB (i.e. the functional currency) against the relevant foreign currencies. The sensitivity rate used when reporting foreign currency risk internally to key management personnel and representing management’s assessment of the reasonably possible change in foreign exchange rates is 1%. The sensitivity analysis included only outstanding foreign currency denominated monetary items and adjusts their translation at the end of the reporting period for a 1% change in foreign currency rates. A positive number below indicates a decrease in pre-tax profit and other equity associated with the RMB strengthening 1% against the relevant currency. For a 1% weakening of the RMB against the relevant currency, there would be an equal and opposite impact on pre-tax profit and the balances below would be negative.

pre-tax profit and the balances below would be negative.
Profit or loss	USD Impact
	For the Year Ended December 31
	2021 2020 $ 2,549 $ 8,609

The above impact was mainly attributable to the exposure on outstanding receivables and payables in USD which were not hedged at the end of the reporting period.

In the management’s opinion, the sensitivity analysis is not representative of the inherent foreign currency risk because the exposure at the end of the reporting period does not reflect the exposure during the period.

b) Interest rate risk

The Group is exposed to interest rate risk because entities in the Group borrow funds at both fixed and floating interest rates.

The carrying amounts of the Group’s financial assets and financial liabilities with exposure to 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
	2021 2020 $ 302,496 $ 4,865 1,134,099 987,567 655,632 922,624 318,320 56,960

Sensitivity analysis

The sensitivity analysis below was based on the Group’s exposure to interest rates for both derivative and non-derivative instruments at the end of the reporting period. For floating rate liabilities, the analysis was prepared assuming the amount of each liability outstanding at the end of the reporting period was outstanding for the whole year. A 100 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates.

If interest rates had been 100 basis points higher/lower and all other variables were held constant, the Group’s pre-tax profit for the years ended December 31, 2021 and 2020 would have increased/decreased by $3,373 thousand and $9,226 thousand, which was mainly attributable to the Group’s exposure to interest rates of its variable-rate bank deposits and borrowings.

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c) Price risk

The Group was exposed to equity price risk through its investments in equity securities. Equity investments are held for strategic rather than for trading purposes, the Group does not actively trade these investments.

Sensitivity analysis

The sensitivity analysis below was determined based on the exposure to equity price risks at the end of the year. If equity prices had been 1% higher/lower, the pre-tax other comprehensive income for the year ended December 31, 2021 and for the year ended December 31, 2020 would have increased/decreased by $241 thousand and $258 thousand, as a result of the changes in fair value of financial assets at FVTOCI.

2) Credit risk

Credit risk refers to the risk that the 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 the counterparty to discharge its obligation, could be equal to the carrying amount of the respective recognized financial assets as stated in the balance sheets.

In order to mitigate credit risk, the management of the Group assigns a team responsible for credit facilities, credit approvals and other monitoring procedures to ensure that appropriate actions are taken for the recovery of overdue receivables. In addition, the Group reviews the recoverable amount of the receivables on the date of the financial statements to ensure that receivables that cannot be recovered have been provided with allowance for impairment loss. Accordingly, the management reckons that the credit risk of the Group has been significantly reduced.

Accounts receivable cover a wide range of customers and are spread across different industries and geographic regions. The Company continuously evaluates the financial position of customers.

In addition, since the counterparty of current funds are financial institutions and companies with good credit ratings, the credit risk is limited.

The Group transacts with a large number of unrelated customers and, thus, no concentration of credit risk was observed.

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.

The Group relies on bank borrowings as a significant source of liquidity. As of December 31, 2021 and 2020, the Group had available unutilized short-term bank loan facilities as set out in (c) below.

a) Liquidity and interest rate risk tables for non-derivative financial liabilities

The following table details the Group’s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The table has 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 table included both interest and principal cash flows. Specifically, bank loans with a repayment on demand clause were included in the earliest time band regardless of

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the probability of the banks choosing to exercise their rights. The maturity dates for other non-derivative financial liabilities were based on the agreed repayment dates.

To the extent that interest flows are at floating rates, the undiscounted amount was derived from the interest rate curve at the end of the reporting period.

December 31, 2021

On Demand or
Less than
1 Month
1-3 Months
3 Months to
1 Year
Non-derivative
financial liabilities
Non-interest bearing
$ 151,552
$ 44,473
$ 107,863

Fixed interest rate
liabilities

562,106

138,425

144,108

$ 713,658
$ 182,898
$ 251,971

December 31, 2020
On Demand or
Less than
1 Month
1-3 Months
3 Months to
1 Year
Non-derivative
financial liabilities
Non-interest bearing
$ 84,862
$ 53,781
$ 141,465

Fixed interest rate
liabilities

557,004

-

-

$ 641,866
$ 53,781
$ 141,465

1-5 Years
$ 58,557

600,000
$ 658,557
1-5 Years
$ 35,889

600,000
$ 635,889

The amount of the variable interest rate liabilities will vary depending on the floating interest rate and the interest rate estimated on the reporting date.

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b) Liquidity risk table 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, and the undiscounted gross inflows and outflows on those derivatives that require gross settlement. 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 year.

December 31, 2021

c)	On Demand or Less than 1 Month 1-3 Months Net settled Foreign exchange forward contracts Inflow $ 7,033 $ 15,184 December 31, 2020 On Demand or Less than 1 Month 1-3 Months Net settled Foreign exchange forward contracts Inflow $ 899 $ 1,762 Outflow (952) (1,833) $ (53) $ (121) Financing facilities Unsecured bank loan facilities which may be extended by mutual agreement: Amount used Amount unused Secured bank loan facilities which may be extended by mutual agreement: Amount used Amount unused		3 Months to 1 Year 1-5 Years $ - $ - 3 Months to 1 Year 1-5 Years $ 2,644 $ - (2,818) - $ (174) $ - December 31	3 Months to 1 Year 1-5 Years $ - $ - 3 Months to 1 Year 1-5 Years $ 2,644 $ - (2,818) - $ (174) $ - December 31
			$	2020 $ 56,960 872,722 $ 929,682 $ - 122,556 $ 122,556

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29. TRANSACTIONS WITH RELATED PARTIES

The Company’s ultimate parent is Jinan Acetate Chemical Co., Ltd.

Balances and transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and are not disclosed in this note. In addition to those disclosed in other notes, transactions between the Group and its related parties are disclosed below:

a. Related party and relationship with the Group

Relationship with the Group Related Party Name and Other Related Parties

Global Filter S.A (GF) Substantive related party Tabacalera Hernandarias S.A. (TH) Substantive related party SAF - INDUSTRIA E COMERCIO DE FILTEROS LTDA Substantive related party (SAF) Yan Kuangmeihua Supply And Marketing Limited Company Substantive related party (Yankuang Kuangmeihua) Yankuang Lunan Chemical Co., Ltd. (Yankuang Lunan Substantive related party Chemical) (shareholder of a subsidiary) Wang, Ke-Chang Key management

b. Operating revenue

Line Item Related Party Category/Name Sales Substantive related party GF Others	For the Year Ended	For the Year Ended	December 31
		2021 $ 164,763 51,507 $ 216,270	2020 $ 272,358 100,099 $ 372,457

The selling prices and payment period in related-party transactions were not significantly different from those for transactions with third parties.

c. Purchases of goods

Related Party Category Substantive related party/Yankuang Kuangmeihua Substantive related party/Yankuang Lunan Chemical	For the Year Ended	For the Year Ended	December 31
		2021 $ 664,746 - $ 664,746	2020 $ 194,255 36,892 $ 231,147

The purchase prices in related-party transactions were not significantly different from those for transactions with third parties.

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d. Receivables from related parties

Line Item Related Party Category/Name Accounts receivable Substantive related party GF TH SAF		December 31	December 31
		2021 $ 9,463 9,126 - $ 18,589	2020 $ 27,728 3,054 44,605 $ 75,387

The outstanding receivables from related parties were unsecured. For the years ended December 31, 2021 and 2020, no impairment loss was recognized on accounts receivable from related parties.

e. Payables to related parties

Line Item Related Party Category/Name Other payables Substantive related party/ Yankuang Lunan Chemical		December 31	December 31
		2021 $ 24,828	2020 $ 23,801

The outstanding payables to related parties were unsecured.

f. Prepayments

Related Party Category/Name Substantive related party/Yankuang Lunan Chemical Substantive related party/Yankuang Kuangmeihua		December 31	December 31
		2021 $ 30,234 6,385 $ 36,619	2020 $ - 25,592 $ 25,592

g. Refundable deposits (other current assets)

Related Party Category Substantive related party/Yankuang Lunan Chemical h. Other transactions with related parties Line Item Related Party Category/Name Manufacturing expense - steam fee Substantive related party/ Yankuang Lunan Chemical Research and development expense - steam fee Substantive related party/ Yankuang Lunan Chemical Operating expense - rental Key management Operating expense - rental Substantive related party/ Yankuang Lunan Chemical		December 31	December 31
	2021 $ 434 For the Year Ended		2020 $ 438 December 31
		2021 $ 198,555 6,362 360 347 $ 205,624	2020 $ 203,639 8,729 360 77 $ 212,805

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The substantive related party provides steam to the Company for use in production and provides rental service.

The key management provides rental service to the Company.

i. Compensation of key management personnel

Compensation of key management personnel
Short-term employee benefits Post-employment benefits	For the Year Ended		December 31
		2021 $ 14,063 118 $ 14,181	2020 $ 8,173 14 $ 8,187

The remunerations of directors and key executives were determined by the remuneration committee on the basis of individual performance and market trends.

30. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

The following assets were provided as collateral for bank borrowings, letters of credit and bank’s acceptance bills:

Financial assets at amortized cost Pledge deposits (classified as other current assets) Property, plant and equipment, net Right-of-use assets Investment properties, net		December 31	December 31
		2021 $ 5,154 142,878 47,418 77,960 - $ 273,410	2020 $ 4,865 91,441 52,492 53,811 74,887 $ 277,496

31. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

In addition to those disclosed in other notes, significant commitments and contingencies of the Group were as follows:

As of December 31, 2021 and 2020, unused letters of credit for purchases of raw materials and machinery and equipment amounted to approximately $207,989 thousand and $196,466 thousand, respectively.

Unrecognized commitments were as follows:

Unrecognized commitments were as follows:
Payments for property, plant and equipment		December	31
		2021 $ 80,642	2020 $ 38,055

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32. SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD

The Groups’ subsidary, Jinan Acetate Chemical, signed the expropritaion contract with Jinan Prior Zone For Replacing Old Growth Drivers with New Zones Management Committee Construction Management Department. The first installment of the investment properties with the right of-use assets and buildings, which located in Qingning areas. Has collected and proceeded in January 13, 2022.

33. OTHER ITEMS

The Group evaluated the economic impact caused by the COVID-19 epidemic. The Group had no significant influence by the epidemic at the date of consolidated financial report announced. The Group will continue to observe and to evaluate the impact on this relevant epidemic.

34. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The Group entities’ significant financial assets and liabilities denominated in foreign currencies aggregated by the foreign currencies other than functional currencies and the related exchange rates between foreign currencies and respective functional currencies were as follows:

		Foreign		Carrying
	Currencies		Exchange Rate	Amount
December 31, 2021
Financial assets
Monetary items
USD	$	21,390	6.380 (USD:RMB) $	609,632
Financial liabilities
Monetary items
USD		12,752	6.380 (USD:RMB)	354,726
December 31, 2020
Financial assets
Monetary items
USD		35,360	6.525 (USD:RMB)	1,009,789
Financial liabilities
Monetary items
USD		5,218	6.525 (USD:RMB)	148,856

56 -

The significant (realized and unrealized) foreign exchange gain (losses) were as follows:

Functional Currency USD Other	For the Year Ended December 31	For the Year Ended December 31
	2021 Exchange Rate Net Foreign Exchange Losses 6.4512 (USD:RMB) $ (26,700) - (1,859) $ (28,559)	2020
		Exchange Rate Net Foreign Exchange Losses 6.8996 (USD:RMB) $ (26,220) - (165) $ (26,365)

35. SEPARATELY DISCLOSED ITEMS

a. Information on significant transactions and investees:
1) Financing provided to others. (Table 1)
2) Endorsements/guarantees provided. (Table 2)
3) Marketable securities held (excluding investment in subsidiaries, associates and joint ventures). (Table 3)
4) Marketable securities acquired and disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital. (None)
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 4)
8) Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital. (Table 5)
9) Trading in derivative instruments. (Note 7)
10) Intercompany relationships and significant intercompany transactions. (Table 6)
b. Information on investees. (Table 7)
c. 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)
57 -
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: (None)
- 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.
d. Information of major shareholders: List all shareholders with ownership of 5% or greater showing the name of the shareholder, the number of shares owned, and percentage of ownership of each shareholder (Table 9)

36. SEGMENT INFORMATION

a. Financial information of the operating segment

Information reported to the chief operating decision maker for resource allocation and assessment of segment performance focuses on the types of goods and services to be delivered. The Group focuses its business mainly on the manufacturing and sales of cellulose acetate products. According to IFRS 8, the Group has organized management and resource allocation in a single department. The operating activities are related to R&D and manufacturing of acetate products, and the operating income of the operating activities accounts for more than 90% of the total revenue.

b. Revenue from major products and services

The following is an analysis of the Group’s revenue from continuing operations from its major products and services.

and services.
Cellulose acetate tow Cellulose acetate Cellulose anhydride	For the Year Ended December 31
		2021 $ 1,772,342 904,111 38,413 $ 2,714,866	2020 $ 1,689,914 663,466 - $ 2,353,380

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c. Geographical information

The Group operates in four principal geographical areas - Asia, Africa, America and Europe.

The Group’s revenue from continuing operations from external customers by location of operations and information about its non-current assets by location of assets are detailed below.

Asia America Europe Africa	Revenue from External Customers	Revenue from External Customers	Revenue from External Customers
	For the Year Ended December 31
		2021 $ 1,933,246 435,481 263,419 82,720 $ 2,714,866	2020 $ 1,508,612 609,740 176,988 58,040 $ 2,353,380

d. Information about major customers

Single customers contributing 10% or more to the Group’s revenue were as follows:

Customer A	For the Year Ended	For the Year Ended	December 31
		2021 $ 164,763	2020 $ 272,358

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TABLE 1

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

FINANCING PROVIDED TO OTHERS FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

No.	Lender	Borrower	Financial Statement Account	Related Party	Highest Balance for the Period (Note 1)	Ending Balance (Note 1)	Actual Borrowing Amount	Interest Rate (%)	Nature of Financing	Business Transaction Amount	Reasons for Short-term Financing	Allowance for Impairment Loss	Collateral	Collateral	Financing Limit for Each Borrower	Aggregate Financing Limit	Note
													Item	Value
1	My Parents	Acetek Momentum	-	Y	$ 27,680 (US$ 1,000 thousand )	$ 27,680 (US$ 1,000 thousand )	-	3.5	Short-term financing	$ -	Operation turnover	$ -	-	$ -	$ 897,300	$ 1,196,400	Note 3
2	Jinan Acetate Chemical	Acetek Material	-	Y	173,760 (RMB 40,000 thousand )	173,760 (RMB 40,000 thousand )	173,760 (RMB 40,000 thousand )	5.0	Short-term financing	-	Operation turnover	-	-	-	697,681	930,241	Note 3

Note 1: The maximum balance for the period and ending balance represent the amounts approved by the board of directors.

Note 2: For foreign subsidiaries whose voting shares are 100% owned, directly or indirectly, by the Company, when the funds are used for financing, the total amount shall not exceed 100% of the net worth of the lender. The total amount for lending to a company for funding shall not exceed 30% of the net worth of the Company.

Note 3: For companies with short-term funding needs, the amount for lending to a company shall not exceed 30% of the net worth of the lender. The total amount for lending shall not exceed 40% of the net worth of the Company.

Note 4: The limit on the amount for lending is calculated according to the recent financial statements audited by the Company’s independent accountants.

Note 5: Spot buy/sell average exchange rates of Bank of Taiwan on December 31, 2021 are used to estimate the amount in New Taiwan dollar.

Note 6: All transactions listed in the table have been eliminated in the preparation of the consolidated statements.

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TABLE 2

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

ENDORSEMENTS/GUARANTEES PROVIDED FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

No. (Note 1)	Endorser/ Guarantor	Endorsee/Guarantee Receiver	Endorsee/Guarantee Receiver	Limit on Endorsement/ Guarantee Given on Behalf of Each Party (Note 3)	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 3)	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	Note
		Name	Relationship (Note 2)
0	Jinan Acetate Chemical Co., Ltd.	Jinan Acetate Chemical Acetek Material	b b	$ 3,792,278 455,073	$ 337,920 43,440	$ 337,920 43,440	$ 56,505 -	$ - -	22.28 2.86	$ 3,792,278 1,516,911	Y Y	N N	Y Y	- Note 4
1	Jinan Acetate Chemical	Jinan Acetate Chemical Co., Ltd. Acetek Momentum Acetek Material	c b b	465,120 465,120 465,120	138,400 86,880 43,440	138,400 86,880 43,440	55,360 - -	58,128 - -	5.95 3.74 1.87	1,162,801 1,162,801 1,162,801	N Y Y	Y N N	N Y Y	- - Note 4

Note 1: Significant transactions between the Company and its subsidiaries or among subsidiaries are numbered as follows:
a. “0” for the Company.
b. Subsidiaries are numbered from “1”
Note 2: Relationships between the endorser/guarantor and the endorsee/guarantee receiver:
a. The Company in relation to business.
b. The Company which holds, directly or indirectly, over 50% of the voting shares.
c. The Company which holds, directly or indirectly, over 50% of the shares.
d. The Company which holds, directly or indirectly, over 90% of the voting shares.
e. Based on contract projects among their peers in accordance with contract provisions which need mutual insurance company.
f. Owing to the joint venture funded by the shareholders on its endorsement of its holding company.
g. Compliance guarantees for the performance of the sales contracts of pre-sold homes within the same industry in accordance with the Consumer Protection Law.

Note 3: The calculation for the amount of endorsement is as follows:

a. The total amount of guarantee provided by the Company to any entity whose voting shares are 100% owned, directly and indirectly, shall not exceed two-hundred-and-fifty percent (250%) of the Company’s net worth.
b. The total amount of guarantee provided by the Company to any individual entity shall not exceed ten percent (30%) of the Company’s net worth. Except for the guarantee provided to any entity whose voting shares are 100% owned, the total balance of guarantee shall not exceed the Company’s total net worth.
c. The total amount of guarantee provided by Jinan Acetate Chemical shall not exceed fifty percent (50%) of its net worth. The total amount of guarantee provided to any individual entity shall not exceed twenty percent (20%) of its net worth.
Note 4: The Company and Jinan Acetate Chemical provide guarantees for Acetek Material. The balance is RMB10,000,000.
Note 5: The limit on the amount for lending is calculated according to the recent financial statements audited by the Company’s independent accountants.
Note 6: Spot buy/sell average exchange rates of Bank of Taiwan on December 31, 2021 are used to estimate the amount in New Taiwan dollar.
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TABLE 3

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

MARKETABLE SECURITIES HELD DECEMBER 31, 2021

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Holding Company Name	Type and Name of Marketable Securities (Note 1)	Relationship with the Holding Company (Note 2)	Financial Statement Account	December 31, 2021	December 31, 2021	December 31, 2021	December 31, 2021	Note (Note 4)
				Number of Shares	Carrying Amount (Note 3)	Percentage of Ownership (%)	Fair Value
Acetek Chemical	Stock ELEUNG LIMITED	-	Financial assets at fair value through other comprehensive income - non-current	333	$ 24,055	25	$ 24,055	-

Note 1: The marketable securities in this table are stocks, bonds and short-term investments accounted for under of “IFRS 9 Financial Instruments”.

Note 2: The parties in the transactions are not significant related parties so the space is empty.

Note 3: Carrying amounts is fair value adjusted for deduction of accumulated impairment loss; otherwise, original carrying amounts at amortized cost after deduction of accumulated impairment loss.

Note 4: Amounts pledged should be noted on the table.

Note 5: The information about subsidiaries, associates and joint ventures is provided in Tables 7 and 8.

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TABLE 4

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE YEAR ENDED DECEMBER 31, 2021

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Buyer	Related Party	Relationship		Transaction Details	Transaction Details	Transaction Details	Abnormal Transaction (Note 1)	Abnormal Transaction (Note 1)	Notes/Accounts Receivable (Payable)	Notes/Accounts Receivable (Payable)	Notes
			Purchase/ Sales	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
Jinan Acetate Chemical Acetek Material Jinan Acetate Chemical Acetek Material	Acetek Material Jinan Acetate Chemical Global Filters S.A. Yan Kuangmeihua Supply And Marketing Limited Company	Subsidiary Parent company Substantive related party Substantive related party	Purchase Sales Sales Purchase	$ 990,202 (990,202) (164,763) 664,746	37 (26) (4) 25	Same as those for unrelated parties Same as those for unrelated parties Same as those for unrelated parties Same as those for unrelated parties	No significant difference No significant difference No significant difference No significant difference	No significant difference No significant difference No significant difference No significant difference	$ - - 9,463 -	- - 2.13 -	Note 2 Note 3 - Note 4

Note 1: Differences in the condition of transactions between related parties and general customers should be noted on the table.

Note 2: The prepayment of $248,066 thousand; purchase prices have no significant difference from general customers.

Note 3: The advance receipt of $248,066 thousand; sales prices have no significant difference from general customers.

Note 4: The prepayment of $6,385 thousand; purchase prices have no significant difference from general customers.

Note 5: Actual capital amount is the actual amount from the parent company, issuer of no par stock or par value stock less than $10 New Taiwan dollar shall follow the actual capital amount as 20% of transaction amount rule; equity is calculated at 10% of the equity in the parent company’s balance sheet.
Note 6: The transactions between the Company and investee companies, except Yan Kuangmeihua Supply And Marketing Limited Company and Global Filters S.A., have been already been eliminated in the preparation of the consolidated financial statements.
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TABLE 5

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL DECEMBER 31, 2021

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Company Name	Related Party	Relationship	Ending Balance (Note 1)	Ending Balance (Note 1)	Turnover Rate	Overdue	Overdue	Amount Received in Subsequent Period	Allowance for Impairment Loss	Note
						Amount	Actions Taken
Jinan Acetate Chemical	Acetek Material	Subsidiary	Account receivables Other receivables	$ 158,006 174,450 $ 332,455	0.75	$ - - $ -		$ - - $ -	$ - - $ -	Note 1 Notes 1 and 2

Note 1: All transactions listed in the table have been eliminated in the preparation of the consolidated statements.

Note 2: The Account Financing of $173,760 thousand and the Interest receivable of $690 thousand.

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TABLE 6

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

INTERCOMPANY RELATIONSHIPS AND SIGNIFICANT TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

No. (Note 1)	Investee Company	Counterparty	Relationship (Note 2)		Transaction Details	Transaction Details
				Financial Statement Account	Amount	Payment Terms	% to Total Sales or Assets (Note 3)
0	Jinan Acetate Chemical Co., Ltd.	Jinan Acetate Chemical	1	Other non-current liabilities	$ 46,872	In accordance with mutual contracts	1
1	My Parents	Jinan Acetate Chemical	3	Other non-current liabilities	19,923	In accordance with mutual contracts	1
2	Jinan Acetate Chemical	Acetek Material Acetek Material Acetek Material Acetek Material Acetek Material	3 3 3 3 3	Account receivables Other receivables Prepayments Sales Purchases	158,005 174,450 248,066 82,586 990,202	In accordance with mutual contracts In accordance with mutual contracts In accordance with mutual contracts In accordance with mutual contracts In accordance with mutual contracts	4 5 7 3 36
3	Acetek Material	Acetek Momentum	3	Prepayments	54,589	In accordance with mutual contracts	2
4	Acetek Momentum	Acetek Material	3	Sales	62,019	In accordance with mutual contracts	2

Note 1: Companies are identified by number, as follows:

a. “0” represents the parent company.
b. “1” represents the subsidiary.

Note 2: The flow of transactions is as follows:

a. 1 - from the parent company to the subsidiary.
b. 2 - from the subsidiary to the parent company.
c. 3 - between subsidiaries.
Note 3: Percentage of consolidated operating revenues or consolidated total assets: If the account is in the balance sheet, it was calculated by dividing the ending balance by the consolidated total assets; if the account is in the income statement, it was calculated by dividing the interim cumulative balance by the consolidated operating revenue.
Note 4: The important transactions listed accord with the materiality principle of the Company.

Note 5: All transactions listed in the table have been eliminated in the preparation of the consolidated statements.

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TABLE 7

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

INFORMATION ON INVESTEES FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Investor Company	Investee Company	Location	Main Business and Product	Original Investment Amount	Original Investment Amount	As of December 31, 2021	As of December 31, 2021	As of December 31, 2021	Net Income (Loss) of the Investee	Share of Profit (Loss) (Note 1)	Note
				December 31, 2021	December 31, 2020	Shares	%	Carrying Amount
Jinan Acetate Chemical Co., Ltd. My Parents	My Parents Living Acetek Chemical	Hong Kong Hong Kong	Investments Investments	$ 974,921 39,196	$ 947,115 39,196	Note 3 Note 3	100 80	$ 2,990,999 20,322	$ 354,615 (106)	$ 354,615 (85)	- -

Note 1: The amount was calculated according to the investee company’s financial statement reviewed by accountants and the Company’s shareholding ratio.

Note 2: The share of profit or loss among investee companies and the net worth between investor and investee companies under the equity method are all eliminated at the time the consolidated financial statements are prepared.

Note 3: The investee company is limited and has no shares.

Note 4: Information on investments in Mainland China, please refer to Table 8.

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TABLE 8

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

INFORMATION ON INVESTMENTS IN MAINLAND CHINA FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Investee Company	Main Businesses and Products	Main Businesses and Products	Paid-in Capital	Method of Investment (Note 1)	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2021	Remittance of Funds	Remittance of Funds	Accumulated Outward Remittance for Investment from Taiwan as of December 31, 2021	Net Income (Loss) of the Investee	Ownership of Direct or Indirect Investment	Investment Gain (Loss) (Note 2)	Carrying Amount as of December 31, 2021	Accumulated Repatriation of Investment Income as of December 31, 2021	Note
						Outward	Inward
Jinan Acetate Chemical Acetek Material Acetek Momentun Acetek Environmental	Manufacturing and sales of cellulose acetate tow Manufacturing and sales of cellulose acetate Manufacturing and sales of cellulose anhydride Manufacturing and sales of cellulose acetate fiber		$ 403,146 (RMB 94,490 thousand) 581,452 (RMB 125,000 thousand) 394,799 (RMB 91,103 thousand) 155,578 (RMB 32,000 thousand)	c c c c	$ - - - -	$ - - - -	$ - - - -	$ - - - -	$ 354,351 10,112 (6,167) (293)	100 80 100 100	$ 354,351 (Note 2 b (2)) 10,881 (Note 2 b (2)) (6,167) (Note 2 b (2)) (293) (Note 2 b (2))	$ 2,195,282 462,137 389,375 139,301	$ - - - -	- Note 3 - -

Accumulated Outward Remittance for Investment in Mainland China as of December 31, 2021		Investment Amounts Authorized by Investment Commission, MOEA		Upper Limit on the Amount of Investment Stipulated by Investment Commission, MOEA
$ -		$ -		$ -

Note 1: Investment is divided into the following three categories which can be marked:

a. Direct investment in mainland China.

b. Reinvestment in mainland China companies through the third region (please indicated the third area of investment company).

c. Others.

Note 2: The investment income (loss) recognized in current period:

a. No investment income (loss) has been recognized due to the investment is still in development stage.

b. The investment income (loss) was determined on the following basis:

1) The financial report was audited and certified by an international accounting firm in cooperation with accounting firm in the ROC.

2) The financial statements were audited by the CPA of the parent company in Taiwan.

3) Others.

Note 3: The realized and unrealized profits and losses among the companies were considered.

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TABLE 9

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

INFORMATION OF MAJOR SHAREHOLDERS DECEMBER 31, 2021

Name of Major Shareholder	Shares	Shares
	Number of Shares	Percentage of Ownership (%)
BRIGHT PEARL ENTERPRISES LTD. MACRIFER TRADING SOCIEDAD ANONIMA AMACRON TRADING LIMITED	20,711,845 9,945,430 4,319,515	36.36 16.98 7.37

Note 1: The information of major shareholders presented in this table is provided by the Taiwan Depository & Clearing Corporation based on the number of ordinary shares and preferred shares held by shareholders with ownership of 5% or greater, that have been issued without physical registration (including treasury shares) by the Company as of the last business day for the current quarter. The share capital in the consolidated financial statements may differ from the actual number of shares that have been issued without physical registration because of different preparation basis.
Note 2: If a shareholder delivers the shareholdings to the trust, the above information will be disclosed by the individual truster who opened the trust account. For shareholders who declare insider shareholdings with ownership greater than 10% in accordance with the Security and Exchange Act, the shareholdings include shares held by shareholders and those delivered to the trust over which shareholders have rights to determine the use of trust property. For information relating to insider shareholding declaration, please refer to Market Observation Post System.
68 -

AI assistant

ACE — Audit Report / Information 2021

52427_rns_2021-11-11_786bdf0a-0bb9-42a4-905d-f12e2ae5def1.pdf

Jinan Acetate Chemical Co., Ltd. and Subsidiaries

INDEPENDENT AUDITORS’ REPORT

Opinion

Basis for Opinion

Key Audit Matters

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

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

Notice to Readers

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars)

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars)

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars)

JINAN ACETATE CHEMICAL CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars)

1. GENERAL INFORMATION

2. APPROVAL OF FINANCIAL STATEMENTS

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

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

e. Foreign currencies

f. Inventories

g. Property, plant and equipment

1) Financial assets

2) Equity instruments

Financial liabilities at FVTPL

b) Derecognition of financial liabilities

4) Convertible bonds

l. Revenue recognition

m. Leasing

1) The Group as lessor

2) The Group as lessee

n. Borrowing costs

q. Taxation

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

6. CASH AND CASH EQUIVALENTS

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

9. FINANCIAL ASSETS AT AMORTIZED COST

10. NOTES RECEIVABLE AND ACCOUNTS RECEIVABLE

December 31, 2021

December 31, 2020

11. INVENTORIES

12. NON-CURRENT ASSETS CLASSIFIED AS HELD FOR SALE

Investment properties measured at fair value

13. SUBSIDIARIES

14. PROPERTY, PLANT AND EQUIPMENT

15. LEASE ARRANGEMENTS

a. Right-of-use assets

16. INVESTMENT PROPERTIES

17. OTHER ASSETS

18. BORROWINGS

Short-term Borrowings

Long-term Borrowings

19. BONDS PAYABLE

20. OTHER PAYABLES

21. RETIREMENT BENEFIT PLANS

22. EQUITY

b. Capital surplus

d. Special reserves

e. Non-controlling interests

f. Treasury shares

23. REVENUE

a. Contract information

c. Disaggregation of revenue

24. NET PROFIT

a. Other income

Accrual rate

Amount

25. INCOME TAXES

c. Deferred tax assets and liabilities

For the year ended December 31, 2020

26. EARNINGS PER SHARE

ACE Audit Report / Information 2021