Altek - Interim / Quarterly Report 2015

ALTEK CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND REVIEW REPORT OF INDEPENDENT

ACCOUNTANTS JUNE 30, 2015 AND 2014

For the convenience of readers and for information purpose only, the auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. In the event of any discrepancy between the English version and the original Chinese version or any differences in the interpretation of the two versions, the Chinese-language auditors’ report and financial statements shall prevail.

REVIEW REPORT OF INDEPENDENT ACCOUNTANTS TRANSLATED FROM CHINESE

PWCR15000031 (In Thousands of New Taiwan Dollars)

To Altek Corporation

We have reviewed the accompanying consolidated balance sheets of Altek Corporation and subsidiaries as of June 30, 2015 and 2014, and the related consolidated statements of comprehensive income for the three-month and six-month periods then ended, as well as the consolidated statements of changes in equity and of cash flows for the six-month periods then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to issue a conclusion on these financial statements based on our reviews.

Except as discussed in the following paragraph, we conducted our reviews in accordance with the Statement of Auditing Standards No. 36 “ Engagements to Review Financial Statements” in the Republic of China. A review consists primarily of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards in the Republic of China, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

As described in Note 4(3), except for the financial statements of major subsidiaries-Altek International Investment Co., Ltd. and its subsidiary-Altek (Kunshan) Co., Ltd., which were consolidated based on their reviewed financial statements, other insignificant subsidiaries were consolidated based on their unreviewed financial statements as of and for the six-month periods ended June 30, 2015 and 2014. As of June 30, 2015 and 2014, total assets of these insignificant subsidiaries amounted to $2,892,892 and $2,347,704, respectively, representing 19% and 14% of the consolidated total assets, respectively, and total liabilities of these insignificant subsidiaries amounted to $528,719 and $308,550, respectively, respresenting 9% and 5% of the consolidated total liabilities, respectively, and their total comprehensive income (loss) amounted to $78,713, ($30,145), $50,410 and ($100,918), constituting 39%, 49%, 32% and 31% of the consolidated total comprehensive income (loss) for the three-month and six-month periods then ended. In addition, as described in Note 6(6) to the consolidated financial

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statements, the financial statements of investments accounted for under the equity method were not reviewed by independent accountants. Equity investments in these investee companies amounted to $169,943 and $300,491 as of June 30, 2015 and 2014, respectively, and their related investment loss amounted to ($3,550), ($13,680), ($5,084) and ($27,897) for the three-month and six-month periods then ended. These amounts were based solely on their unreviewed financial statements.

Based on our reviews, except for the effect of such adjustments, if any, as might have been determined to be necessary had the financial statements of certain subsidiaries and investee companies been reviewed by independent accountants as described in the preceding paragraph, we are not aware of any material modifications that should be made to the consolidated financial statements referred to in the first paragraph in order for them to be in conformity with the “Rules Governing the Preparation of Financial Statements by Securities Issuers” and IAS 34 “Interim Financial Reporting”, as endorsed by the Financial Supervisory Commission.

PricewaterhouseCoopers, Taiwan Hsinchu, Taiwan Republic of China

August 10, 2015

The accompanying consolidated financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying consolidated financial statements and report of independent accountants are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice.

As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

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ALTEK CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

(Expressed in thousands of New Taiwan dollars)

(The consolidated balance sheets as of June 30, 2015 and 2014 are reviewed, not audited)

Assets	Notes	June 30,2015	December31,2014 AMOUNT % $ 5,441,850 34 362,155 2 73,485 1 2,367,794 15 20,323 - 2,767 - 1,176,361 8 194,519 1 3,801 - 9,643,055 61 151,369 1 179,520 1 5,603,692 35 103,447 1 84,918 - 86,210 1 6,209,156 39 $ 15,852,211 100	June 30,2014
		AMOUNT $ 4,346,740 402,846 63,637 2,412,804 14,157 2,763 1,796,743 193,754 20,867 9,254,311 171,410 169,943 5,355,465 94,473 71,793 83,067 5,946,151 $ 15,200,462	AMOUNT $ 5,441,850 362,155 73,485 2,367,794 20,323 2,767 1,176,361 194,519 3,801 9,643,055 151,369 179,520 5,603,692 103,447 84,918 86,210 6,209,156 $ 15,852,211	AMOUNT $ 4,007,086 558,447 85,443 4,099,616 69,794 2,538 1,148,910 243,047 5,502 10,220,383 156,067 300,491 5,537,319 102,149 63,368 84,504 6,243,898 $ 16,464,281	%
Current assets Cash and cash equivalents Current financial assets at fair value through profit or loss Notes receivable, net Accounts receivable, net Other receivables Current income tax assets Inventories Prepayments Other current assets Current Assets Non-current assets Non-current financial assets at cost Investments accounted for using equity method Property, plant and equipment Intangible assets Deferred income tax assets Other non-current assets Non-current assets Total assets	6(1) 6(2) 6(4) 6(5) 6(3) 6(6) 6(7) 6(8) 6(9)				24 3 1 25 - - 7 2 -
					62
					1 2 34 1 - -
					38
					100

(Continued)

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ALTEK CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Expressed in thousands of New Taiwan dollars)

(The consolidated balance sheets as of June 30, 2015 and 2014 are reviewed, not audited)

Liabilities and Equity	Notes	June 30,2015	% 10 16 5 - - 4 35 1 3 - 4 39 18 12 9 1 19 2 - 61 - 61 100	December31,2014 June 30,2014 AMOUNT % AMOUNT % $ 1,410,000 9 $ 1,000,000 6 2,933,033 19 3,299,219 20 530,190 3 522,368 3 71,778 - 36,721 - 64,373 - 113,354 1 438,251 3 569,851 3 5,447,625 34 5,541,513 33 120,235 1 84,173 1 583,165 4 519,495 3 21,058 - 19,680 - 724,458 5 623,348 4 6,172,083 39 6,164,861 37 2,701,358 17 3,941,583 24 2,063,551 13 2,116,668 13 1,319,477 8 1,319,477 8 142,456 1 142,456 1 2,964,969 19 3,042,899 19 481,868 3 4,511 - - - ( 274,323)( 2) 9,673,679 61 10,293,271 63 6,449 - 6,149 - 9,680,128 61 10,299,420 63 $ 15,852,211 100 $ 16,464,281 100
		AMOUNT $ 1,542,000 2,346,376 741,052 38,294 51,731 532,439 5,251,892 135,637 527,540 21,058 684,235 5,936,127 2,702,538 1,933,054 1,347,010 142,456 2,845,407 287,012 - 9,257,477 6,858 9,264,335 $ 15,200,462		AMOUNT $ 1,410,000 2,933,033 530,190 71,778 64,373 438,251 5,447,625 120,235 583,165 21,058 724,458 6,172,083 2,701,358 2,063,551 1,319,477 142,456 2,964,969 481,868 - 9,673,679 6,449 9,680,128 $ 15,852,211
Current liabilities Short-term borrowings Accounts payable Other payables Current income tax liabilities Provisions for liabilities - current Other current liabilities Current Liabilities Non-current liabilities Provisions for liabilities - noncurrent Deferred income tax liabilities Other non-current liabilities Non-current liabilities Total Liabilities Equity attributable to owners of parent Share capital Common stock Capital surplus Capital surplus Retained earnings Legal reserve Special reserve Unappropriated retained earnings Other equity interest Other equity interest Treasury stocks Equity attributable to owners of the parent Non-controlling interest Total equity Significant contingent liabilities and unrecognised contract Total liabilities and equity	6(10) 12(2) 12(2) 6(13) 6(13) 6(11) 6(14) 6(15) 6(16) 6(17) 6(14) 9

The accompanying notes are an integral part of these consolidated financial statements. See review report of independent accountants dated August 10, 2015.

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ALTEK CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Sales revenue
Operating costs
Net operating margin
Operating expenses
Selling expenses
General & administrative expenses
Research and development expenses
Total operating expenses
Operating profit
Non-operating income and expenses
Other income
Other gains and losses
Finance costs
Share of loss of associates and joint
ventures accounted for under equity
method
Total non-operating income and
expenses
Profit before income tax
Income tax expense
Profit for the period

(Expressed in thousands of New Taiwan dollars, except earnings per share)
(UNAUDITED)
Forthe three-monthperiods ended June 30
Forthe six-monthperiods ended June 30
2015
2014
2015
2014
Notes
AMOUNT
%
AMOUNT
%
AMOUNT
%
AMOUNT
%
$ 3,024,205
100
$ 4,851,525
100
$ 5,603,383
100
$ 8,655,782
100
6(21)(22) and
7
(
2,657,544) (
88) (
4,347,628) (
90) (
4,954,956) (
88) (
7,843,152) (
91)
366,661
12
503,897
10
648,427
12
812,630
9
6(21)(22)
(
16,951) (
1) (
21,223)
- (
29,949) (
1) (
44,529)
-
(
53,136) (
2) (
57,089) (
1) (
101,487) (
2) (
107,990) (
1)
(
252,614) (
8) (
270,773) (
6) (
496,117) (
9) (
485,087) (
6)
(
322,701) (
11) (
349,085) (
7) (
627,553) (
12) (
637,606) (
7)
43,960
1
154,812
3
20,874
-
175,024
2
6(18)
27,017
1
21,976
-
55,846
1
104,388
1
6(19)
(
12,798) (
1) (
3,036)
- (
8,845)
-
9,922
-
6(20)
(
4,627)
- (
3,732)
- (
9,585)
- (
7,115)
-
6(6)
(
3,550)
- (
13,680)
- (
5,084)
- (
27,897)
-
6,042
-
1,528
-
32,332
1
79,298
1
50,002
1
156,340
3
53,206
1
254,322
3
6(23)
(
9,113)
- (
23,139)
- (
9,699)
- (
39,327) (
1)
$ 40,889
1
$ 133,201
3
$ 43,507
1
$ 214,995
2

(Continued)

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ALTEK CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Other comprehensive income Components of other comprehensive income that will not be reclassified to profit or loss Actuarial gain on defined benefit plan Components of other comprehensive income that will be reclassified to profit or loss Currency translation differences of foreign operations Share of other comprehensive loss of associates and joint ventures accounted for uner equity method Income tax relating to the components of other comprehensive income Components of other comprehensive income that will be reclassified to profit or loss Total other comprehensive (loss) income for the period Total comprehensive (loss) income for the period Profit, attributable to: Owners of the parent Non-controlling interest Profit for the period Comprehensive (loss) income attributable to: Owners of the parent Non-controlling interest Total comprehensive (loss) income for the period Basic earnings per share Diluted earnings per share	(Expressed in thousands of New Taiwan dollars, except earnings per share) (UNAUDITED) Forthe three-monthperiods ended June 30 Forthe six-monthperiods ended June 30 2015 2014 2015 2014 Notes AMOUNT % AMOUNT % AMOUNT % AMOUNT % $ - - $ - - $ - - $ 7,322 - ( 101,703) ( 3) ( 194,454) ( 4) ( 229,453) ( 4) ( 26,922) - ( 4,236) - ( 6,534) - ( 5,313) - ( 1,263) - 6(23) 18,009 - 34,168 - 39,910 - 4,792 - ( 87,930) ( 3)( 166,820)( 4) ( 194,856)( 4) ( 23,393) - ($ 87,930) ( 3)($ 166,820) ( 4) ($ 194,856)( 4) ($ 16,071) - ($ 47,041) ( 2)($ 33,619) ( 1) ($ 151,349)( 3) $ 198,924 2 $ 40,617 1 $ 132,944 3 $ 43,098 1 $ 214,640 2 272 - 257 - 409 - 355 - $ 40,889 1 $ 133,201 3 $ 43,507 1 $ 214,995 2 ($ 47,313) ( 2) ($ 33,876) ( 1) ($ 151,758) ( 3) $ 198,569 2 272 - 257 - 409 - 355 - ($ 47,041) ( 2)($ 33,619) ( 1) ($ 151,349)( 3) $ 198,924 2 6(24) $ 0.15 $ 0.34 $ 0.16 $ 0.56 6(24) $ 0.15 $ 0.34 $ 0.16 $ 0.56	(Expressed in thousands of New Taiwan dollars, except earnings per share) (UNAUDITED) Forthe three-monthperiods ended June 30 Forthe six-monthperiods ended June 30 2015 2014 2015 2014 Notes AMOUNT % AMOUNT % AMOUNT % AMOUNT % $ - - $ - - $ - - $ 7,322 - ( 101,703) ( 3) ( 194,454) ( 4) ( 229,453) ( 4) ( 26,922) - ( 4,236) - ( 6,534) - ( 5,313) - ( 1,263) - 6(23) 18,009 - 34,168 - 39,910 - 4,792 - ( 87,930) ( 3)( 166,820)( 4) ( 194,856)( 4) ( 23,393) - ($ 87,930) ( 3)($ 166,820) ( 4) ($ 194,856)( 4) ($ 16,071) - ($ 47,041) ( 2)($ 33,619) ( 1) ($ 151,349)( 3) $ 198,924 2 $ 40,617 1 $ 132,944 3 $ 43,098 1 $ 214,640 2 272 - 257 - 409 - 355 - $ 40,889 1 $ 133,201 3 $ 43,507 1 $ 214,995 2 ($ 47,313) ( 2) ($ 33,876) ( 1) ($ 151,758) ( 3) $ 198,569 2 272 - 257 - 409 - 355 - ($ 47,041) ( 2)($ 33,619) ( 1) ($ 151,349)( 3) $ 198,924 2 6(24) $ 0.15 $ 0.34 $ 0.16 $ 0.56 6(24) $ 0.15 $ 0.34 $ 0.16 $ 0.56
		$ 0.56

The accompanying notes are an integral part of these consolidated financial statements. See review report of independent accountants dated August 10, 2015.

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ALTEK CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2015 AND 2014

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated) (UNAUDITED)

Notes			Equity attributable to owners ofthe parent	Equity attributable to owners ofthe parent	Equity attributable to owners ofthe parent	Equity attributable to owners ofthe parent					Non-controlling interest Totalequity
	Commonstock	Capitalsurplus		RetainedEarnings			Currency translation differences of foreign operations	Treasury stocks		Total
			Legal reserve	Special reserve	Unappropriated retained earnings
6(12)(15)( 16) 6(14)(15) 6(16) 6(17) 6(12)(15)( 16) 6(16) 6(17)	$ 3,902,653 - 88,930 ( 50,000 ) - - - $ 3,941,583 $ 2,701,358 - - 1,180 - - $ 2,702,538	$ 2,028,690 - 112,394 ( 24,416 ) - - - $ 2,116,668 $ 2,063,551 - ( 135,127 ) 4,630 - - $ 1,933,054	$ 1,319,477 - - - - - - $ 1,319,477 $ 1,319,477 27,533 - - - - $ 1,347,010	$ 339,267 ( 196,811 ) - - - - - $ 142,456 $ 142,456 - - - - - $ 142,456	$ 2,715,960 196,811 - ( 91,834 ) - 214,640 7,322 $ 3,042,899 $ 2,964,969 ( 27,533 ) ( 135,127 ) - 43,098 - $ 2,845,407	$ 27,904 - - - - - ( 23,393) $ 4,511 $ 481,868 - - - - ( 194,856) $ 287,012		($ 440,573 ) - - 166,250 - - - ($ 274,323) $ - - - - - - $ -	$ 9,893,378 - 201,324 - - 214,640 ( 16,071) $10,293,271 $ 9,673,679 - ( 270,254 ) 5,810 43,098 ( 194,856) $ 9,257,477		$ 6,530 $ 9,899,908 - - - 201,324 - - ( 736 ) ( 736 ) 355 214,995 - ( 16,071) $ 6,149 $10,299,420 $ 6,449 $ 9,680,128 - - - ( 270,254 ) - 5,810 409 43,507 - ( 194,856) $ 6,858 $ 9,264,335

The accompanying notes are an integral part of these consolidated financial statements. See review report of independent accountants dated August 10, 2015.

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ALTEK CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX-MONTH PERIODS ENDED JUNE 30

(Expressed in thousands of New Taiwan dollars) (UNAUDITED)

CASH FLOWS FROM OPERATING ACTIVITIES
Consolidated profit before tax for the period
Adjustments to reconcile profit before tax to net cash used
in operating activities
Income and expenses having no effect on cash flows
Depreciation expense
Amortisation expense
Net loss on financial assets at fair value through profit
or loss
Interest expense
Interest income
Share-based payment compensation cost
Share of loss of associates and joint ventures accounted
for under equity method
Gain on disposal of property, plant and equipment
Changes in assets/liabilities relating to operating activities
Net changes in assets relating to operating activities
Financial assets at fair value through profit or loss -
current
Notes receivable
Accounts receivable
Other receivables
Inventories
Prepayments
Other current assets
Net changes in liabilities relating to operating
activities
Accounts payable
Other payables
Provisions for liabilities
Other current liabilities
Other non-current liabilities
Cash used in operations
Interest received
Interest paid
Income tax paid
Net cash used in operating activities

Notes
2015
2014
$ 53,206
$ 254,322
6(7)(21)
199,386
184,825
6(8)(21)
7,633
9,515
6(2)(19)
4,232
4,519
6(20)
9,585
7,115
6(18)
(
25,511 ) (
42,392 )
6(12)
1,739
3,952
5,084
27,897
6(19)
-
(
2,079 )
(
47,215 ) (
120,799 )
7,709
16,359
(
60,046 ) (
1,780,396 )
5,564
(
23,460 )
(
653,326 )
193,719
(
3,282 ) (
64,383 )
(
17,266 )
6,327
(
525,640 )
788,113
(
56,147 ) (
109,982 )
3,033
(
77,904 )
96,361
(
32,717 )
-
346
(
994,901 ) (
757,103 )
25,824
54,256
(
9,737 ) (
7,023 )
(
45,768) (
3,919)
(
1,024,582) (
713,789)

(Continued)

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ALTEK CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX-MONTH PERIODS ENDED JUNE 30

(Expressed in thousands of New Taiwan dollars) (UNAUDITED)

CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of financial assets at cost
Acquisition of property, plant and equipment
Proceeds from disposal of property, plant and equipment
Increase in intangible assets
Decrease in deposits received
Net cash used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Increase in short-term borrowings
Decrease in deposits-in
Employee stock options exercised
Net cash provided by financing activities
Effect of exchange rate
Decrease in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

Notes
2015
2014
($ 20,355 )
$ -
6(26)
(
21,275 ) (
91,143 )
-
2,079
6(26)
(
6,591 ) (
4,156 )
1,348
2,736
(
46,873 ) (
90,484 )
132,000
-
-
(
906 )
4,071
197,372
136,071
196,466
(
159,726 ) (
4,519 )
(
1,095,110 ) (
612,326 )
6(1)
5,441,850
4,619,412
6(1)
$ 4,346,740
$ 4,007,086

The accompanying notes are an integral part of these consolidated financial statements. See review report of independent accountants dated August 10, 2015.

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ALTEK CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX-MONTH PERIODS ENDED JUNE 30

(Expressed in thousands of new Taiwan dollars, unless stated otherwise)

(Reviewed, Not Audited)

1. HISTORY AND ORGANIZATION

Altek Corporation (the “Company”) was incorporated as a company limited by shares under the provisions of the Company Law of the Republic of China (R.O.C.). The Company and its subsidiaries (collectively referred herein as the “Group”) are primarily engaged in the development, manufacturing and sale of digital image technology application, related export and import trade.

The Company was listed in the Taiwan Stock Exchange on December 24, 2002, as approved by the Tai-Tz (91) Letter No. 024976 of the former Securities and Futures Commission, Ministry of Finance, R.O.C., dated September 27, 2002.

2. THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL STATEMENTS AND PROCEDURES FOR AUTHORIZATION

These consolidated financial statements were authorized for issuance by the Board of Directors on August 10, 2015.

3. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS

(1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRSs”) as endorsed by the Financial Supervisory Commission (“FSC”)
According to Financial-Supervisory-Securities-Auditing No. 1030010325 issued by FSC on April 3, 2014, commencing 2015, companies with shares listed on the TWSE or traded on the Taipei Exchange or Emerging Stock Market shall adopt the 2013 version of IFRS (not including IFRS 9, ‘Financial instruments’) as endorsed by the FSC and Regulations Governing the Preparation of Financial Reports by Securities Issuers effective January 1, 2015 (collectively referred herein as “the 2013 version of IFRS”) in preparing the consolidated financial statements. The impact of adopting the 2013 version of IFRS is listed below:
A. IAS 19 , ‘Employee benefits’
- The revised standard makes amendments that net interest amount, calculated by applying the discount rate to the net defined benefit asset or liability, replaces the finance charge and expected return on plan assets. The revised standard eliminates the accounting policy choice that the actuarial gains and losses could be recognised based on corridor approach or recognised in profit or loss. The revised standard requires that the actuarial gains and losses can only be recognised immediately in other comprehensive income when incurred. Past service cost will be recognised immediately in the period incurred and will no longer be amortised using

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straight-line basis over the average period until the benefits become vested. An entity is required to recognise termination benefits at the earlier of when the entity can no longer withdraw an offer of those benefits and when it recognises any related restructuring costs, rather than when the entity is demonstrably committed to a termination.

B. IAS 1, ‘Presentation of financial statements’

The amendment requires entities to separate items presented in OCI classified by nature into two groups on the basis of whether they are potentially reclassifiable to profit or loss subsequently when specific conditions are met. If the items are presented before tax then the tax related to each of the two groups of OCI items (those that might be reclassified and those that will not be reclassified) must be shown separately. Accordingly, the Group will adjust its presentation of the statement of comprehensive income.

C. IFRS 12, ‘Disclosure of interests in other entities’

The standard integrates the disclosure requirements for subsidiaries, joint arrangements, associates and unconsolidated structured entities. Also, the Group will disclose additional information about its interests in consolidated entities and unconsolidated entities accordingly.

D. IFRS 13, ‘Fair value measurement’

The standard defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standard sets out a framework for measuring fair value using the assumptions that market participants would use when pricing the asset or liability; for non-financial assets, fair value is determined based on the highest and best use of the asset. Also the standard requires disclosures about fair value measurements. Based on the Group’s assessment, the adoption of the standard has no significant impact on its consolidated financial statements, and the Group will disclose additional information about fair value measurements accordingly.

(2) Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted by

the Group

None.

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(3) IFRSs issued by IASB but not yet endorsed by the FSC

New standards, interpretations and amendments issued by IASB but not yet included in the 2013 version of IFRS as endorsed by the FSC:

version of IFRS as endorsed by the FSC:
New Standards,Interpretations and Amendments	Effective Date by International Accounting Standards Board
IFRS 9, ‘Financial instruments' Sale or contribution of assets between an investor and its associate or joint venture (amendments to IFRS 10 and IAS 28) Investment entities: applying the consolidation exception (amendments to IFRS 10, IFRS 12 and IAS 28) Accounting for acquisition of interests in joint operations (amendments to IFRS 11) IFRS 14, 'Regulatory deferral accounts' IFRS 15, ‘Revenue from contracts with customers' Disclosure initiative (amendments to IAS 1) Clarification of acceptable methods of depreciation and amortisation (amendments to IAS 16 and IAS 38) Agriculture: bearer plants (amendments to IAS 16 and IAS 41) Defined benefit plans: employee contributions (amendments to IAS 19R) Equity method in separate financial statements (amendments to IAS 27) Recoverable amount disclosures for non-financial assets (amendments to IAS 36) Novation of derivatives and continuation of hedge accounting (amendments to IAS 39) IFRIC 21, ‘Levies’ Improvements to IFRSs 2010-2012 Improvements to IFRSs 2011-2013 Improvements to IFRSs 2012-2014	January 1, 2018 January 1, 2016 January 1, 2016 January 1, 2016 January 1, 2016 January 1, 2018 January 1, 2016 January 1, 2016 January 1, 2016 July 1, 2014 January 1, 2016 January 1, 2014 January 1, 2014 January 1, 2014 July 1, 2014 July 1, 2014 January 1, 2016

version of IFRS as endorsed by the FSC:

New Standards,Interpretations and Amendments

Effective Date by
International Accounting
Standards Board

IFRS 9, ‘Financial instruments'
Sale or contribution of assets between an investor and its associate or
joint venture (amendments to IFRS 10 and IAS 28)
Investment entities: applying the consolidation exception (amendments
to IFRS 10, IFRS 12 and IAS 28)
Accounting for acquisition of interests in joint operations
(amendments to IFRS 11)
IFRS 14, 'Regulatory deferral accounts'
IFRS 15, ‘Revenue from contracts with customers'
Disclosure initiative (amendments to IAS 1)
Clarification of acceptable methods of depreciation and amortisation
(amendments to IAS 16 and IAS 38)
Agriculture: bearer plants (amendments to IAS 16 and IAS 41)
Defined benefit plans: employee contributions
(amendments to IAS 19R)
Equity method in separate financial statements (amendments to IAS 27)
Recoverable amount disclosures for non-financial assets
(amendments to IAS 36)
Novation of derivatives and continuation of hedge accounting
(amendments to IAS 39)
IFRIC 21, ‘Levies’
Improvements to IFRSs 2010-2012
Improvements to IFRSs 2011-2013
Improvements to IFRSs 2012-2014

January 1, 2018
January 1, 2016
January 1, 2016
January 1, 2016
January 1, 2016
January 1, 2018
January 1, 2016
January 1, 2016
January 1, 2016
July 1, 2014
January 1, 2016
January 1, 2014
January 1, 2014
January 1, 2014
July 1, 2014
July 1, 2014
January 1, 2016

The Group is assessing the potential impact of the new standards, interpretations and amendments above and has not yet been able to reliably estimate their impact on the consolidated financial statements.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

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(1) Compliance statement

A.The consolidated financial statements of the Group have been prepared in accordance with the “Rules Governing the Preparation of Financial Statements by Securities Issuers” and IAS 34, ‘Interim Financial Reporting’ as endorsed by the FSC.
B.The consolidated financial statements should be read with the consolidated financial statements for the year 2014.

(2) Basis of preparation

A.Except for the following items, the consolidated financial statements have been prepared under the historical cost convention:
a) Financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.
b) Defined benefit liabilities recognised based on the net amount of pension fund assets less present value of defined benefit obligation.
B.The preparation of financial statements in conformity with International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the FSC (collectively referred herein as the “IFRSs”) requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5.

(3) Basis of consolidation

A.Basis for preparation of consolidated financial statements:
Basis for preparation of consolidated financial statements is consistent with the consolidated financial statements for the year 2014.

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B. Subsidiaries included in the consolidated financial statements:

Name of Investor	Name ofSubsidiaries	Main BusinessActivities		Ownership (%)		Note
			June 30,2015	December31,2014	June 30,2014
Altek Corporation " " " " Altek International Investment Co., Ltd. " Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Altek Trading (Shanghai) Limited Note 2	Altek International Investment Co., Ltd. Altek Japan Corporation Altek Investment Co., Ltd. Altek Autotronics Corporation Altek Biotechnology Corporation Altek Lab Inc. Altek Optical (Cayman) Co., Ltd. Altek (Kunshan) Co., ltd. Altek EMS (Kunshan) Co., Ltd. Altek Imaging Technology (Shanghai) Limited Altek Precision (Kunshan) Co., Ltd. Altek Trading (Shanghai) Limited Altek Semiconductor Corporation Beijing Altek Image Communication Technology Co., Ltd. Altek Optical Technology (Kunshan) Co., Ltd.	Investments and general business operations Sales and design of optical instruments Investments Research design, manufacture and sales of car electronic components Research and development, manufacture and sales of biotechnology Design service Investments and general business operations Manufacture and sales of digital still camera and its accessories Manufacture and sales of related engineering services Manufacture and sales of optical components Manufacture and sales of digital camera parts Wholesale, import and export of related electronic and their associated accessories Research design and sales of ASIC Sales of related electronic and their related accessories Manufacture and sales of related electronic services and its accessories and optical components	100% 100% 100% 98.02% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%	100% 100% 100% 98.02% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%	100% 100% 100% 97.96% - 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%	Note 4 Note 4 Note 1 Note 4 Note 3 Note 4 Note 4 Note 4 Note 4 Note 4 Note 4 Note 4 Note 4 Note 4 Note 4

Note 1: Ownership increased due to subsidiary’s continued repurchase of shares of Altek Autotronics Corporation.

Note 2: Altek International Investment Co., Ltd.’s wholly- owned subsidiaries - Leading Tech. Co., Ltd. 、 Toptek Investment Cayman Co., Ltd. 、 Altek Imaging Technology (Cayman) Co., Ltd. 、 Altek Trading (Cayman)

Co., Ltd. 、 Altek Semiconductor (Cayman) Co., Ltd. 、 Altek Optical Technology (Cayman) Co., Ltd. which Altek International Investment Co., Ltd. invests other subsidiaries through.

Note 3: Altek Biotechnology Corporation established on December 11, 2014.

Note 4: As the subsidiaries do not meet the definition of significant subsidiaries, their financial statements as of June 30, 2015 and 2014 were not reviewed by independent accountants.

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C.Subsidiaries not included in the consolidated financial statements: None.
D.Adjustments for subsidiaries with different balance sheet dates: None.
E.Material restrictions: None.
F.Subsidiaries that have non-controlling interests that are material to the Group:None.

(4) Employee benefits

Pension cost for the interim period is calculated on a year-to-date basis by using the pension cost rate derived from the actuarial valuation at the end of the prior financial year, adjusted for significant market fluctuations since that time and for significant curtailments, settlements, or other significant one-off events. Also, the related information is disclosed accordingly.

(5) Income tax

The interim period income tax expense is recognised based on the estimated average annual effective income tax rate expected for the full financial year applied to the pretax income of the interim period, and the related information is disclosed accordingly.

5. CRITICALACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF

ASSUMPTION UNCERTAINTY

The preparation of these consolidated financial statements requires management to make critical judgements in applying the Group’s accounting policies and make critical assumptions and estimates concerning future events. Assumptions and estimates may differ from the actual results and are continually evaluated and adjusted based on historical experience and other factors. Such assumptions and estimates have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year; and the related information is addressed below:

(1) Critical judgements in applying the Group’s accounting policies: None.

(2) Critical accounting estimates and assumptions:

A.Impairment assessment of investments accounted for using equity method
The Group assesses the impairment of an investment accounted for using equity method as soon as there any indication that it might have been impaired and its carrying amount cannot be recoverable. The Group assesses the recoverable amounts of an investment accounted for under the equity method based on the present value of expected cash dividends receivable from the investee and expected future cash flows from the disposal of the investee, and analyses the reasonableness of related assumptions.
As of June 30, 2015, the Group’s investments accounted for under the equity method, net of impairment loss, amounted to $169,943.
B.Evaluation of inventories

As inventories are stated at the lower of cost and net realisable value, the Group must determine the net realisable value of inventories on balance sheet date using judgements and estimates. Due to the rapid technology innovation, the Group evaluates the amounts of normal inventory

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consumption, obsolete inventories or inventories without market selling value on balance sheet date, and writes down the cost of inventories to the net realisable value. Such an evaluation of inventories is principally based on the demand for the products within the specified period in the future. Therefore, there might be material changes to the evaluation. As of June 30, 2015, the carrying amount of inventories was $1,796,743.

6. DETAILS OF SIGNIFICANT ACCOUNTS

(1) Cash

Cash
Cash on hand Checking accounts and demand deposits Time deposits	June 30,2015 1,198 $ 102,606 4,242,936 4,346,740 $	December 31,2014 1,194 $ 126,864 5,313,792 5,441,850 $	June 30,2014
			1,161 $ 200,825 3,805,100
			4,007,086 $

A.The Group transacts with a variety of financial institutions all with high credit quality to disperse credit risk, so it expects that the probability of counterparty default is remote.

B.The Group has no cash and cash equivalents pledged to others.

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

Financial assets at fair value through profit or loss
Items June30,2015 Current items: Financial assets held for trading 406,504 $ Listed stocks - Valuation adjustment 3,658) ( Total 402,846 $	December31,2014 June30,2014 361,658 $ 521,941 $ - 42,411 497 5,905) ( 362,155 $ 558,447 $
		558,447 $

The Group recognized net (loss) of $(10,808) and $(15,920) for the three-month periods ended June 30, 2015 and 2014, respectively, and net (loss) of $(11,995) and $(4,519) for the six-month periods ended June 30, 2015 and 2014, respectively.

(3) Financial assets measured at cost

Financial assets measured at cost
Items			June30,2015	December	31,2014		June30,2014
Non-current items:
Unlisted stocks		$	261,443	$	241,402	$	245,219
Less: Accumulated impairment	(		90,033)	(	90,033)	(	89,152)
Total		$	171,410	$	151,369	$	156,067

A.As the Group’s investment in unlisted stocks are not traded in an active market, and no sufficient industry information of companies similar to these stocks financial information can be obtained, the fair value of the investment in unlisted stocks cannot be measured reliably. The Group classified those stocks as ‘financial assets measured at cost’.

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B. No impairment loss was recognised for the financial assets measured at cost for the three-month or six-month periods ended June 30, 2015 and 2014.
C.As of June 30, 2015, December 31, 2014 and June 30, 2014, no financial assets measured at cost held by the Group were pledged to others.
(4) Accounts receivable

held by the Group were pledged to others. Accounts receivable
June30,2015 December31,2014 Accounts receivable 2,412,841 $ 2,367,831 $ Less: allowance for bad debts 37) ( 37) ( 2,412,804 $ 2,367,794 $	June30,2014
	4,099,616 $ -
	4,099,616 $

A.The credit quality of accounts receivable that were neither past due nor impaired was in the following categories based on the Group’s Credit Quality Control Policy:

Group 1 Group 2	June30,2015 2,376,252 $ 30,568 2,406,820 $	December31,2014 2,357,895 $ 8,784 2,366,679 $	June30,2014
			4,073,957 $ 4,340
			4,078,297 $

Note:

Group 1: Including domestic and foreign listed companies and their affiliated companies. Group 2: Others.

B.The ageing analysis of accounts receivable that were past due but not impaired is as follows:

Up to 30 days 31 to 90 days 91 to 180 days Over 181 days	June30,2015 3,568 $ 2,416 - - 5,984 $	December31,2014 1,077 $ 38 - - 1,115 $	June30,2014
			5,761 $ 14,899 604 55
			21,319 $

The above ageing analysis was based on past due date.

C.Movements on the Group’s provision for impairment of accounts receivable are as follows:

	2015
Individualprovision 37 $	Group provision - $ 2014	Total
		37 $

	Group provision Total - $ 652,675 $ - 652,675) ( - $ - $	Total
		- $

Note: The impaired financial assets refer to receivables from Kodak US which has filed for

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bankruptcy protection. The full amount of the unrecovered receivables was recorded as impaired. The possibility of recovery of receivables was assessed to be low during the second quarter of 2014, thus, the receivables were eliminated.

D.The Group does not hold any collateral as security.

(5) Inventories

nventories
Raw materials Work-in-process Finished goods Total Raw materials Work-in-process Finished goods Total Raw materials Work-in-process Finished goods Total		June30,2015
	Cost 727,697 $ 236,951 946,188 1,910,836 $	Allowance for valuation loss 67,545) ($ 21,831) ( 24,717) ( 114,093) ($ December31,2014	Bookvalue
			660,152 $ 215,120 921,471
			1,796,743 $

	Cost 497,182 $ 236,833 555,805 1,289,820 $		Bookvalue
			426,474 $ 213,676 536,211
			1,176,361 $

	Cost 558,409 $ 158,162 540,995 1,257,566 $		Bookvalue
			490,834 $ 135,715 522,361
			1,148,910 $

The cost of inventories recognised as expense for the three-month periods ended June 30, 2015 and 2014 was $2,657,544 and $4,347,627, respectively, and for the six-month periods ended June 30, 2015 and 2014 was $4,954,956 and $7,843,151, respectively, including the amount of $133, ($5,406), $3,999 and ($4,976), respectively, that the Group wrote down from cost to net realizable value accounted for as ‘cost of goods sold’ or that the Group reversed from a previous inventory write-down and accounted for as reduction of ‘cost of goods sold’.

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(6) Investments accounted for under the equity method

		June 30,2015	December	31,2014		June 30,2014
JinJing Optical Technology Co., Ltd.	$	55,065	$	61,214	$	58,877
Phoenix Optical (Shanghai) Co., Ltd.		151,679		155,107		265,201
		206,744		216,321		324,078
Less: accumulated impairment loss	(	36,801)	(	36,801)	(	23,587)
	$	169,943	$	179,520	$	300,491

The carrying amount of the Group’s interests in all individually immaterial associates and the Group’s share of the operating results are summarized below:

As of June 30, 2015, December 31, 2014 and June 30, 2014, the carrying amount of the Group’s individually immaterial associates amounted to $169,943, $179,520 and $300,491, respectively.

Loss for the period from continuing operations Other comprehensive income- net of tax Total comprehensive loss	Six-month period ended June 30,2015	Six-month period ended June 30,2014
	42,048) ($ 398 41,650) ($	72,747) ($ - 72,747) ($

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(7) Property, plant and equipment

At January 1, 2015 Cost Accumulated depreciation For the six-month period ended June 30, 2015 Opening net book amount Additions Disposals Reclassifications Depreciation charge Net exchange differences Closing net book amount At June 30, 2015 Cost Accumulated depreciation	Land Buildings 1,042,216 $ 3,774,021 $ - 496,859) ( 1,042,216 $ 3,277,162 $ 1,042,216 $ 3,277,162 $ - - - - - - - 47,772) ( - 51,574) ( 1,042,216 $ 3,177,816 $ 1,042,216 $ 3,714,093 $ - 536,277) ( 1,042,216 $ 3,177,816 $	Machinery	Test equipment
		1,914,467 $ 920,394) ( 994,073 $ 994,073 $ 127 - 240 87,237) ( 23,251) ( 883,952 $ 1,868,456 $ 984,504) ( 883,952 $	221,421 $ 178,466) ( 42,955 $ 42,955 $ 1,395 - - 12,329) ( 821) ( 31,200 $ 219,321 $ 188,121) ( 31,200 $

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At January 1, 2014 Cost Accumulated depreciation For the six-month period ended June 30, 2014 Opening net book amount Additions Disposals Reclassifications Depreciation charge Net exchange differences Closing net book amount At June 30, 2014 Cost Accumulated depreciation	Land Buildings 1,042,216 $ 3,637,511 $ - 384,930) ( 1,042,216 $ 3,252,581 $ 1,042,216 $ 3,252,581 $ - - - - - - - 46,863) ( - 14,395) ( 1,042,216 $ 3,191,323 $ 1,042,216 $ 3,620,885 $ - 429,562) ( 1,042,216 $ 3,191,323 $	Machinery	Test equipment
		2,297,655 $ 1,223,233) ( 1,074,422 $ 1,074,422 $ 8,641 - 3,670 75,980) ( 6,715) ( 1,004,038 $ 2,293,458 $ 1,289,420) ( 1,004,038 $	211,774 $ 144,247) ( 67,527 $ 67,527 $ 1,494 - 1,200 14,851) ( 204) ( 55,166 $ 213,072 $ 157,906) ( 55,166 $

For the six-month periods ended June 30, 2015 and 2014, there was no capitalisation of borrowing interests attributable to the property, plant and equipment and the Group did not pledge any fixed asset as collateral.

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(8) Intangible assets

(8)	Intangible assets	Intangible assets	Intangible assets
(9)	A. Details of amortisation on intangible assets are as follows: B.The Group has no intangible assets pledged to others. Long-term prepaid rents ( shown as‘Other non-current assets’) 2015 2014 At January 1 Cost 138,662 $ 141,213 $ Accumulated amortisation and impairment 35,215) ( 30,800) ( 103,447 $ 110,413 $ For the six-month period ended June 30 Opening net book amount 103,447 $ 110,413 $ Additions 428 787 Amortisation charge 7,118) ( 9,017) ( Net exchange differences 2,284) ( 34) ( Closing net book amount 94,473 $ 102,149 $ At June 30 Cost 124,155 $ 127,915 $ Accumulated amortisation and impairment 29,682) ( 25,766) ( 94,473 $ 102,149 $ Three-month period endedJune30,2015 Three-month period endedJune30,2014 Operating costs 1,902 $ 1,848 $ Operating expense 1,636 2,548 3,538 $ 4,396 $ Six-month period endedJune30,2015 Six-month period endedJune30,2014 Operating costs 3,841 $ 3,723 $ Operating expense 3,277 5,294 7,118 $ 9,017 $ June 30,2015 December 31,2014 June 30,2014 Land-use right 39,459 $ 40,957 $ 38,927 $			2014 141,213 $ 30,800) ( 110,413 $ 110,413 $ 787 9,017) ( 34) ( 102,149 $ 127,915 $ 25,766) ( 102,149 $ Three-month period endedJune30,2014
			1,902 $ 1,636 3,538 $ Six-month period endedJune30,2015		1,848 $ 2,548 4,396 $ Six-month period endedJune30,2014
					$	3,723 5,294 9,017 June 30,2014 38,927 $
					$
	Land-use right	June 30,2015 39,459 $

The Group recognized amortisation expenses for the three-month periods ended June 30, 2015 and 2014 amounting to $255 and $248, and for the six-month periods ended June 30, 2015 and 2014 amounting to $515 and $498 respectively.

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(10) Short-term borrowings

Short-term borrowings
Type ofborrowings Bank borrowings Unsecured borrowings Type of borrowings Bank borrowings Unsecured borrowings Type ofborrowings Bank borrowings Unsecured borrowings	June 30,2015 1,542,000 $ December 31,2014 1,410,000 $ June 30,2014 1,000,000 $	Interestraterange 1.21%~1.32% Interest rate range 1.21%~1.36% Interestraterange 1.19%~1.32%	Collateral
			None Collateral
			None Collateral
			None

(11) Pensions

A. a)The Company and its domestic subsidiaries have a defined benefit pension plan in accordance with the Labor Standards Law, covering all regular employees’ service years prior to the enforcement of the Labor Pension Act on July 1, 2005 and service years thereafter of employees who chose to continue to be subject to the pension mechanism under the Law. Under the defined benefit pension plan, two units are accrued for each year of service for the first 15 years and one unit for each additional year thereafter, subject to a maximum of 45 units. Pension benefits are based on the number of units accrued and the average monthly salaries and wages of the last 6 months prior to retirement. The Company contributes monthly an amount equal to 2% of the employees’ monthly salaries and wages to the retirement fund deposited with Bank of Taiwan, the trustee, under the name of the independent retirement fund committee.
b) For the aforementioned pension plan, the Group recognised pension costs of $3 and $3 for the three-month periods ended June 30, 2015 and 2014, and of $6 and $352 for the six-month periods ended June 30, 2015 and 2014, respectively.
c) Expected contributions to the defined benefit pension plans of the Group for the year ended December 31, 2016 amounts to $12.
B. a) Effective July 1, 2005, the Company and its domestic subsidiaries have established a defined contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular employees with R.O.C. nationality. Under the New Plan, the Company and its domestic subsidiaries contribute monthly an amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment. For the three-month periods ended June 30, 2015 and 2014, the Group had recognized pension costs of $8,835and $8,907, and for the six-month periods ended June 30, 2015 and 2014, the Group had recognized pension costs of $17,669 and$17,688, respectively,

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under the above pension scheme.

b) The subsidiaries provided defined contribution plans for its employees. Pursuant to local regulations, such employees and the subsidiaries each make contributions based on a certain percentage based of the salaries and wages to the pension funds. The subsidiaries had recognised pension costs of $15,313 and $14,252 for the three-month periods ended June 30, 2015 and 2014, respectively, and of $24,343 and $25,314 for the six-month periods ended June 30, 2015 and 2014, respectively.

(12) Share-based payments

A.As of June 30, 2015 and 2014, the Company’s share-based payment arrangements were as follows:

			Quantity	Quantity	Quantity	Contract	Vesting	Vesting
Type of arrangement		Grant date	granted			period	conditions
Employee stock options		June 13, 2008			8,000	9.6 years	Note
"		October 31, 2008			1,000	9.2 years	Note
"		March 23, 2009			3,000	8.8 years	Note
"		October 28, 2011			3,000	9.2 years	Note
"		March 21, 2012			3,000	8.9 years	Note
Note: 2 years’ service vest	40%, 3 years’ service vest 70%,			4	years’	service vest	100%.
Details of the share-based payment arrangements are as			follows:
		For the six-month period				For the six-month period
		June 30,2015				June 30,	2014
		Weighted-average				Weighted-average
		exercise price					exercise	price
		No. of options (in dollars)(Note)			No.	of options	(in dollars)(Note)
Options outstanding at
beginning of the period		6,561 $	33.60			15,708	$	22.60
Options forfeited		-		-	(	254)		-
Options exercised	(	118)	34.50		(	8,893)		22.19
Optical expired	(	1,288)		-		-		-
Options outstanding at end of
the period		5,155	34.50			6,561		23.30
Options exercisable at end of
the period		3,637	34.10			3,201		22.60
Approved and not yet issued
options at the end of the
period		-				-

Note: 2 years’ service vest 40%, 3 years’ service vest 70%, 4 years’ service vest 100%. B.Details of the share-based payment arrangements are as follows:

Note: The exercise price of stock options was adjusted based on the cash dividends, stock

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dividends and cash capital reduction per share distributed.

C.The weighted-average stock price of stock options at exercise dates for the three-month periods ended June 30, 2014 was $31.21 (in dollars), and for the six-month periods ended June 30, 2015 and 2014 was $37.48 and $30.39 (in dollars), respectively. The stock options have not been exercised during the three-month period ended June 30, 2015.
D.The expiry date and exercise price of stock options outstanding at balance sheet date are as follows:

follows:
Issue date approved Expirydate June 13, 2008 December 31, 2017 October 31, 2008 December 31, 2017 March 23, 2009 December 31, 2017 October 28, 2011 December 31, 2020 March 21, 2012 December 31, 2020	June 30,2015		December 31,2014	June 30,2014
	No. of shares (inthousands) 1,400 30 - 2,320 1,405	Exercise price (Note)(indollars) 33.40 $ 28.00 - 34.70 34.50	No. of shares Exercise price (inthousands) (Note)(indollars) 1,555 33.40 $ 256 28.00 366 26.40 2,320 34.70 2,064 34.50	No. of shares Exercise price (inthousands) (Note)(indollars) 1,555 23.20 $ 256 19.40 366 18.30 2,320 24.10 2,064 23.90

Note: The exercise price of stock options was adjusted based on the cash dividends, stock dividends and cash capital reduction per share distributed.
E.The fair value of stock options granted after January 1, 2008 is measured using the Black-Scholes option-pricing model. Relevant information is as follows:

Type of arrangement	Grant date	Stock price (in dollars)	Exercise price (Note 1) (in dollars)	Expected price volatility	Expected option life	Expected dividends 1.5% 1.5% 1.5% 1.4% 1.4%	Risk-free interest rate	Fair value per unit (in dollars)
Employee stock options " " " "	June 13, 2008 October 31, 2008 March 23, 2009 October 28, 2011 March 21, 2012	$ 45.50 32.60 30.90 30.65 27.85	$ 33.40 28.00 26.40 34.70 34.50	24.45% 22.11% 22.63% 30.27% 33.54%	6 years 6 years 6 years 5 years 4.9 years		2.40% 1.88% 0.96% 1.18% 1.08%	10.56 6.54 5.73 7.42 7.35

Note 1: The exercise price of stock options was adjusted based on the cash dividends, stock dividends and cash capital reduction per share distributed.
Note 2: Given that the exercise was close to the grant date, the fair value per unit was estimated using the intrinsic value method.
F.Expenses incurred on share-based payment transactions are shown below:

For the three-month period For the three-month period ended June 30, 2015 ended June 30, 2014 Equity-settled $ 713 $ 1,662

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(13)	Provisions Equity-settled At January 1, 2015 Additional provisions Exchange differences At June 30, 2015 Current Non-current		For the six-month ended June 30,	period For the six-month period 2015 ended June 30,2014 1,739 3,952 $ 184,608 $ 3,033 273) ( 187,368 $ December31,2014 June30,2014 64,373 $ 113,354 $ 120,235 $ 84,173 $
			$

The Group gives warranties on digital image technology application products sold. Provision for warranty is estimated based on historical warranty data of digital image technology application products.

(14) Share capital

A.As of June 30, 2015, the Company’s authorized capital was $5,000,000, consisting of 500,000 thousand shares of ordinary stock, and the paid-in capital was $2,702,538 with a par value of $10 (in dollars) per share. All proceeds from shares issued have been collected.

Movements in the number of the Company’s ordinary shares outstanding are as follows:

(Expressed in thousands of shares)

At January 1 Employee stock options exercised At June 30	2015 270,136 118 270,254	2014
		377,015 8,893
		385,908

B.Treasury shares

a) Reason for share reacquisition and movements in the number of the Company’s treasury shares are as follows:

June 30, 2015 and December 31, 2014 ： None.

June 30, 2014

		June 30, 2014	June 30, 2014
Shares held by	Reason for reacquisition	(in thousands of shares)
		Number of shares 8,250	BookValue 274,323 $
Altek Corporation	To be reissued to employees

b) Pursuant to the R.O.C. Securities and Exchange Law, the number of shares bought back as treasury share should not exceed 10% of the number of the Company’s issued and

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outstanding shares and the amount bought back should not exceed the sum of retained earnings, paid-in capital in excess of par value and realised capital surplus.

c) Pursuant to the R.O.C. Securities and Exchange Law, treasury shares should not be pledged as collateral and is not entitled to dividends before it is reissued.
d) Pursuant to the R.O.C. Securities and Exchange Law, treasury shares should be reissued to the employees within three years from the reacquisition date and shares not reissued within the three-year period are to be retired. Treasury shares to enhance the Company’s credit rating and the stockholders’ equity should be retired within six months of acquisition.
e) The cancellation of treasury shares was approved by the Board of Directors’ resolution dated November 4, 2013, amounting to $166,250 consisting of 5,000 thousand shares. The capital reduction date was on February 11, 2014, and the registration for cancellation of treasury shares had been completed.
f) The cancellation of treasury shares was approved by the Board of Directors’ resolution on September 22, 2014, amounting to $192,026 consisting of 5,775 thousand shares. The capital reduction date was on October 7, 2014, and the registration for cancellation of treasury shares had been completed.
C. On June 19, 2014, the stockholders have resolved to reduce capital by $1,182,475. The expectation is elimination of 118,247,496 shares (including elimination of 2,475,000 treasury shares as a result of the cash capital reduction) and 300 shares out of every thousand shares. The capital reduction ratio is approximately 30% and $3 (in dollars) is returned for each share. The amount of the Company's issued shares is expected to be 275,910,825 shares with a par value of $10 (in dollars), and the paid-in capital will be $2,759,108 after the capital reduction. The capital reduction date was set on September 4, 2014, and the registration for the capital reduction had been completed. The amount of share capital that should be refunded was $1,157,725. On September 22, 2014, the Board of Directors has resolved the distribution date of return of share capital as October 24, 2014.
D. For the six-month period ended June 30, 2015, the Company issued of 118 thousand shares for employee stock options exercised and the registration for issuance had been completed.
E. Under the Enterprise Merger and Acquisition Act, in consideration of business strategies and division of services to increase competitiveness and operational performance, the Company decided to spin-off its medical electronics segment (including assets or liabilities) to its –
wholly-owned subsidiary Altek Biotechnology Corporation. On April 20, 2015, the Board of Directors has proposed to set the spin-off date as September 30, 2015. The Company used the assets of the electromedical equipment segment amounting to $400,000 to swap for common shares of Altek Biotechnology Corporation at $10 per share and obtained 40,000 thousand shares. The split is to be resolved by the shareholders on June 2, 2015 and approved by Taiwan

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Stock Exchange that after the split the Altek Corporation will still go public.

(15) Capital surplus

Pursuant to the R.O.C. Company Law, capital surplus arising from paid-in capital in excess of par value on issuance of common stocks and donations can be used to cover accumulated deficit or to issue new stocks or cash to shareholders in proportion to their share ownership, provided that the Company has no accumulated deficit. Further, the R.O.C. Securities and Exchange Law requires that the amount of capital surplus to be capitalised mentioned above should not exceed 10% of the paid-in capital each year. Capital surplus should not be used to cover accumulated deficit unless the legal reserve is insufficient.

the legal reserve is insufficient.
Sharepremium At January 1, 2015 2,012,075 $ Employee stock options expenses - Employee stock options exercised 3,758 Cash dividends from capital surplus 135,127) ( At June 30, 2015 1,880,706 $ Sharepremium At January 1, 2014 1,903,779 $ Employee stock options expenses - Employee stock options exercised 188,687 Cancellation of treasury shares 24,391) ( At June 30, 2014 2,068,075 $	Employee stock options	Difference between proceeds from disposal of subsidiaryand book value Total 958 $ 2,063,551 $ - 1,739 - 2,891 - 135,127) ( 958 $ 1,933,054 $ Difference between proceeds from disposal of subsidiaryand book value Total 958 $ 2,028,690 $ - 3,952 - 108,442 - 24,416) ( 958 $ 2,116,668 $
	50,518 $ 1,739 867) ( - 51,390 $ Employee stock options
	123,953 $ 3,952 80,245) ( 25) ( 47,635 $

(16) Retained earnings

A. According to the Company’s Articles of Incorporation, the annual earnings, if any, shall first be used to pay all taxes and offset prior years’ operating losses and then 10% of the remaining amount shall be set aside as legal reserve. Special reserve shall be set aside in accordance with the rules set forth in the Securities and Exchange Law, and remaining amount shall be distributed in the following order:
(a) allocating 10% to 20% as employees’ bonus;
(b)allocating 2% as directors’ and supervisors’ remuneration; and
(c)distributing the remaining amount as common stockholders’ dividends in accordance with the resolution adopted by the Board of Directors and approved at the stockholders’ meeting. Employees who are entitled to stock bonus include employees of subsidiaries of companies which the Company holds more than 50% of shares.

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B. The amount of dividends appropriated is based on the Company’s current year’s net income and prior years’ retained earnings, taking into account the Company’s financial structure and future operating plans. The distribution ratio of cash dividends to stock dividends is based on the Company’s funding status, diluted earnings per share and other factors. According to the dividend policy adopted by the Board of Directors, cash dividends shall account for at least 20% of the total dividends distributed. Dividends appropriation shall be resolved by the stockholders at the stockholders’ meeting.
C. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in proportion to their share ownership, the legal reserve shall not be used for any other purpose. The use of legal reserve for the issuance of stocks or cash to shareholders in proportion to their share ownership is permitted, provided that the balance of the reserve exceeds 25% of the Company’s paid-in capital.
D. a) In accordance with the regulations, the Company shall set aside special reserve from the debit balance on other equity items at the balance sheet date before distributing earnings. When debit balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings.
b) The amounts previously set aside by the Company as special reserve on initial application of IFRSs in accordance with Jin-Guan-Zheng-Fa-Zi Letter No. 1010012865, dated April 6, 2012, shall be reversed proportionately when the relevant assets are used, disposed of or reclassified subsequently. Such amounts are reversed upon disposal or reclassified if the assets are investment property of land, and reversed over the use period if the assets are investment property other than land.
E. The appropriation of 2014 earnings had been resolved at the stockholders’ meeting on June 2, 2015. The appropriation of 2013 losses had been resolved at the stockholders’ meeting on June 19, 2014. Details are summarized below:

Legal reserve Special reserve Cash dividends	Dividends per share Dividends per share Amount (in NT dollars) Amount (in NT dollars) 27,533 $ - - $ - - - 196,811) ( - 135,127 0.5 - - 162,660 $ 196,811) ($ 2014 2013		2013
	Amount 27,533 $ - 135,127 162,660 $

The appropriation of 2014 earning was the same as that approved by the Board of Directors on April 20, 2015. The deficit compensation of 2013 was the same at that approved by the Board of Directors on March 21, 2014. The additional paid-in capital was returned to stockholders as

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resolved at the stockholders’ meeting on June 2, 2015. Furthermore, on June 2, 2015, the shareholders resolved to return capital surplus $135,127 (approximately $0.5 per share) to shareholders on the nature of capital contribution.
F. The information relating to employee’s remuneration (bonuses) and director’s and supervisor’s remuneration please refer to note 6(22).

(17) Other equity items

Other equity items
		2015				2014
At January 1		$	481,868		$		27,904
Currency translation differences:
Group	(		190,446)	(			22,345)
Associates	(		4,410)	(			1,048)
At June 30		$	287,012			$	4,511
Other income
		For the three-month period		For the three-month period
		endedJune30,	2015			endedJune30,	2014
Rental revenue	$		2,912	$			4,277
Interest income:
Interest income from bank deposits			11,484				17,680
Others			16				19
Other income - others			12,605				-
Total	$		27,017		$		21,976
		For the six-month period				For the six-month period
		endedJune30,	2015			endedJune30,	2014
Rental revenue	$		5,822	$			8,837
Interest income:
Interest income from bank deposits			25,478				42,352
Others			33				40
Other income - others (Note)			24,513				53,159
Total	$		55,846		$		104,388

(18) Other income

Note: The Company was allotted shares and warrants of Kodak US, due to the property distribution plan of Kodak US. The Company recognized this transaction as other income for the six-month periods ended June 30, 2015 and 2014.

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(19) Other gains and losses

Other gains and losses	Other gains and losses	Other gains and losses
Finance costs Expenses by nature For the three-month period For the three-month period endedJune30,2015 endedJune30,2014 Net losses on financial assets at fair value through profit or loss 10,808) ($ 15,920) ($ Net currency exchange (loss) gains 1,990) ( 13,571 Gain on disposal of property, plant and equipment - 186 Other expenses - 873) ( Total 12,798) ($ 3,036) ($ For the six-month period For the six-month period endedJune30,2015 endedJune30,2014 Net losses on financial assets at fair value through profit or loss 11,995) ($ 4,519) ($ Net currency exchange gains 3,231 13,987 Gain on disposal of property, plant and equipment - 2,079 Other expenses 81) ( 1,625) ( Total 8,845) ($ 9,922 $ For the three-month period For the three-month period ended June 30,2015 ended June 30,2014 Interest expense: Bank borrowings 4,627 $ 3,732 $ For the six-month period For the six-month period ended June 30,2015 ended June 30,2014 Interest expense: Bank borrowings 9,585 $ 7,115 $ For the three-month period For the three-month period ended June 30,2015 ended June 30,2014 Employee benefit expenses 409,447 $ 461,026 $ Depreciation charges on property, plant and equipment 97,961 92,283 Amortisation charges on intangible assets 3,538 4,396 Total 510,946 $ 557,705 $

		461,026 $ 92,283 4,396
		557,705 $

(20) Finance costs

Bank borrowings
(21) Expenses by nature

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Employee benefit expenses Employee benefit expenses Depreciation charges on property, plant and equipment Amortisation charges on intangible assets Total Wages and salaries Employee stock options Labor and health insurance fees Pension costs Other personnel expenses Total Wages and salaries Employee stock options Labor and health insurance fees Pension costs Other personnel expenses Total	For the six-month period ended June 30,2015 787,742 $ 199,386 7,118 994,246 $ For the three-month period ended June 30,2015 350,014 $ 713 20,276 24,151 14,293 409,447 $ For the six-month period ended June 30,2015 676,263 $ 1,739 39,589 42,018 28,133 787,742 $	For the six-month period ended June 30,2014 857,900 $ 184,825 9,017 1,051,742 $ For the three-month period ended June 30,2014 397,063 $ 1,662 21,844 23,162 17,295 461,026 $ For the six-month period ended June 30,2014 734,869 $ 3,952 41,860 43,354 33,865 857,900 $	For the six-month period ended June 30,2014 857,900 $ 184,825 9,017 1,051,742 $ For the three-month period ended June 30,2014 397,063 $ 1,662 21,844 23,162 17,295 461,026 $ For the six-month period ended June 30,2014 734,869 $ 3,952 41,860 43,354 33,865 857,900 $

			397,063 $ 1,662 21,844 23,162 17,295
			461,026 $
			For the six-month period ended June 30,2014
			734,869 $ 3,952 41,860 43,354 33,865
			857,900 $

(22) Employee benefit expenses

A.According to the Articles of Incorporation of the Company, when distributing earnings, the Company shall distribute bonus to the employees and pay remuneration to the directors and supervisors that account for 10%~20% and 2%, respectively, of the total distributed amount. However, in accordance with the Company Act amended on May 20, 2015, a company shall distribute employee remuneration, based on the current year's profit condition, in a fixed amount or a proportion of profits. If a company has accumulated deficit, earnings should be channeled to cover losses. Aforementioned employee remuneration could be paid by cash or stocks. Specifics of the compensation are to be determined in a board meeting that registers two-thirds of directors in attendance, and the resolution must receive support from half of participating members. The resolution should be reported to the shareholders' meeting. Qualification requirements of employees, including the employees of subsidiaries of the

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company meeting certain specific requirements, entitled to receive aforementioned stock or cash may be specified in the Articles of Incorporation.

B.For the three-month and six-month periods ended June 30, 2015 and 2014, employees’ remuneration (bonus) was accrued at $5,504, $17,947, $5,839 and $28,976, respectively; directors’ and supervisors’ remuneration was accrued at $734, $2,393, $779 and $3,864, respectively. The aforementioned amounts were recognized in salary expenses. The expenses recognised for the year of 2015 were accrued based on the earnings of current year; the expenses recognised for the year of 2014 were accrued based on the net income of 2014 and the percentage specified in the Articles of Incorporation of the Company, taking into account other factors such as legal reserve.
C.The 2013 directors’ and supervisors’ remuneration and employees’ cash bonus as appropriated during the stockholders’ meeting on June 2, 2015 were $4,956 and $37,170, respectively. Employees’ bonus and directors’ and supervisor’ remuneration of 2014 as resolved by the stockholders were in agreement with those amounts recognised in the 2014 financial statements.
Information about the appropriation of employees’ bonus and directors’ and supervisors’ remuneration by the Company as proposed by the Board of Directors and resolved by the stockholders will be posted in the “ Market Observation Post System ” at the website of the Taiwan Stock Exchange.

(23) Income tax

A.Income tax expense
a) Components of income tax expense:

	For the three-month period	For the three-month period	For the three-month period	For the three-month period	For the three-month period	For the three-month period
			endedJune30,2015			endedJune30,2014
Current tax:
Current tax on profits for the
period		$	21,395	$		25,571
Adjustments in respect of prior
years	(		8,195)			5
Total current tax			13,200			25,576
Deferred tax:
Origination and reversal of
temporary differences	(		4,087)	(		2,437)
Total deferred tax	(		4,087)	(		2,437)
Income tax expense		$	9,113		$	23,139

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		For the six-month period	For the six-month period	For the six-month period	For the six-month period
			endedJune30,2015		endedJune30,2014
	Current tax:
	Current tax on profits for the
	period	$	23,594	$	27,594
	Adjustments in respect of prior
	years	(	7,344)	(	1,267)
	Total current tax		16,250		26,327
	Deferred tax:
	Origination and reversal of
	temporary differences	(	6,551)		13,000
	Total deferred tax	(	6,551)		13,000
	Income tax expense	$	9,699	$	39,327
b)	The income tax charged to equity	during the period is as follows:
		For the three-month period		For the three-month period
			endedJune30,2015		endedJune30,2014
	Translation differences of
	foreign operations	($	18,009)	($	34,168)
		For the six-month period		For the six-month period
			endedJune30,2015		endedJune30,2014
	Translation differences of
	foreign operations	($	39,910)	($	4,792)

B. As of June 30, 2015, the Company’s income tax returns through 2012 have been assessed and approved by the Tax Authority.

	approved by the Tax Authority.
C.	Unappropriated retained earnings:
		June	30,2015	December31,2014			June 30,2014
	Earnings generated in and
	after 1998 $		2,845,407	$	2,964,969	$	3,042,899
	As of June 30, 2015, December 31,	2014	and June 30,	2014,	the balance of	the imputation tax
	credit account was $273,873, $240,479 and $223,882,			respectively. The creditable tax rate was
	8.26% for 2014 and was 9.63% for 2015.

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(24) Earnings per share

Earnings per share
Basic earnings per share Profit attributable to ordinary shareholders of the parent Diluted earnings per share Profit attributable to ordinary shareholders of the parent Assumed conversion of all dilutive potential ordinary shares Employee stock options Employees’ bonus Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares Basic earnings per share Profit attributable to ordinary shareholders of the parent Diluted earnings per share Profit attributable to ordinary shareholders of the parent Assumed conversion of all dilutive potential ordinary shares Employee stock options Employees’ bonus Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares	For the three-monthperiod ended June 30,2015
	Weighted average number of ordinary shares outstanding Earnings per share Amount after tax (share in thousands) (in dollars) 40,617 $ 270,254 0.15 $ 40,617 $ - 4 - 1,314 40,617 $ 271,572 0.15 $ For the three-monthperiod ended June 30,2014		Earnings per share (in dollars)
			0.15 $
			0.15 $
	Amount after tax 132,944 $ 132,944 $ - - 132,944 $	Weighted average number of ordinary shares outstanding (share in thousands) 385,804 - 1,068 1,040 387,912	Earnings per share (in dollars)
			0.34 $
			0.34 $

~35~

For the six-monthperiod ended June 30,2015	For the six-monthperiod ended June 30,2015	For the six-monthperiod ended June 30,2015
Weighted average number of ordinary shares outstanding Amount after tax (share in thousands) 43,098 $ 270,197 43,098 $ - 46 - 1,314 43,098 $ 271,557 For the six-monthperiod ended June 30,		Earnings per share (in dollars)
		0.16 $
		0.16 $
	Weighted average number of ordinary shares outstanding (share in thousands) 381,502 899 1,040 383,441

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(25) Operating leases

The Group acquired a Taipei building for operating use. However, this building is still under a certain unexpired lease agreement. Contingent rents of $5,735, $7,101, $11,471 and $14,490 were recognized for these leases in profit or loss for the three-month and six-month periods ended June 30, 2015 and 2014, respectively. The future aggregate minimum lease payments receivable under non-cancellable operating leases are as follows:

Not more than 1 year	June 30,2015 - $	December 31,2014 12,045 $	June 30,2014
			25,046 $

The Group leases office buildings for operational needs under non-cancellable operating lease agreements. These lease terms are between 2015 and 2027. Most of the lease agreements are renewable at the market price at the end of the lease period. The future aggregate minimum lease payments receivable under non-cancellable operating leases are as follows:

Not more than 1 year More than 1 year but not more than 5 years Over 5 years Total	June 30,2015 19,149 $ 19,683 27,722 66,554 $	December31,2014 20,573 $ 27,083 29,570 77,226 $	June 30,2014
			12,262 $ 15,275 31,418
			58,955 $

(26) Supplemental cash flow information

A.Investing activities with partial cash payments

Acquisitions of property, plant, and equipment Add:property and equipment and construction billings payable at beginning of period Less: property and equipment and construction billings payable at end of period Cash paid	For the six-month period endedJune30,2015	For the six-month period endedJune30,2014
	30,989 $ 8,332 18,046) ( 21,275 $	88,363 $ 8,848 6,068) ( 91,143 $

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Acquisitions of intangible assets Add: intangible billings payable at beginning of period Less: intangible billings payable at end of period Cash paid		For the six-month period ended June 30,2015	For the six-month period ended June 30,2014
		428 $ 6,163 - 6,591 $	787 $ 6,738 3,369) ( 4,156 $

B.Financing activities with no cash flow effects

Cash dividend declared Additional paid-in capital returned to stockholders		For the six-month period endedJune30,2015		For the six-month period endedJune30,2014
		135,127 $ 135,127 270,254 $		- $ - - $

7. RELATED PARTY TRANSACTIONS

(1)Significant transactions and balances with related parties:

No significant related party transactions.

(2)Key management compensation

Key management compensation
Salaries and other short-term employee benefits Post-employment benefits Share-based payments Total Salaries and other short-term employee benefits Post-employment benefits Share-based payments Total	For the three-month period ended June 30,2015		For the three-month period ended June 30,2014 4,846 $ 108 363 5,317 $ For the six-month period ended June 30,2014
	6,391 $ 216 255 6,862 $ For the six-month period ended June 30,2015

		17,399 $ 432 546		9,991 $ 216 726 10,933 $
		18,377 $

8. PLEDGED ASSETS

None.

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9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNISED CONTRACT COMMITMENTS

(1) Contingencies

The GUC (General Unsecured Creditor Trustee) of Eastman Kodak Company (hereunder ‘Kodak’) filed a lawsuit against the Company in the United States Bankruptcy Court for the Southern District of New York, asserting certain payments in 49.2 million transactions prior to Kodak’s bankruptcy were out of ordinary course of business. The Company vigorously disputed GUC’s claim, and insists that the transactions had always been made in the ordinary course of business with Kodak. According to the press release, GUC has sued over 700 of Kodak’s suppliers, trying to require marginal settlement fees from the suppliers, as it is a regular ploy of US bankruptcy lawyers in bankruptcy cases. For the protection of shareholders’ interests, the Company did not accept GUC’s settlement proposal. The GUC’s assertion has now been heard by the court, and this case does not have a significants impact on the Company’s business and financial performance.

10. SIGNIFICANT DISASTER LOSS

None.

11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE

None.

12. OTHERS

(1) Capital risk management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure. The Group may adjust the amount of dividends, return capital or issue new shares to achieve the optimal capital structure.

(2) Financial instruments

A. Fair value information of financial instruments
The carrying amounts of financial instruments (including cash and cash equivalents, notes receivable, accounts receivable, other receivables, refundable deposits (shown as non-current assets), short-term borrowings, notes payable, accounts payable, other payables, and guarantee deposits received (shown as non-current liabilities)) are approximate to their fair value. The fair value information of financial instruments measured at fair value is provided in Note 12(3).
B.Financial risk management policies
a) The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk, interest rate risk and price risk), credit risk and liquidity risk. The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial position and financial

~39~

performance.

b) Risk management is carried out by a central treasury department (Group treasury) under policies approved by the Board of Directors. Group treasury identifies, evaluates and hedges financial risks in close co-operation with the Group’s operating units, as well as provides written principles for overall risk management and policies covering specific areas and matters, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity.
C.Significant financial risks and degrees of financial risks
a) Market risk

Foreign exchange risk

i.The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the USD. Foreign exchange risk arises from future commercial transactions, recognised assets and liabilities and net investments in foreign operations.
ii.Management has set up a policy to require that group companies hedge their entire foreign exchange risk exposure with Group treasury. Foreign exchange risk arises when future commercial transactions or recognised assets or liabilities are denominated in a currency that is not the entity’s functional currency.
iii.The Group has certain investments in foreign operations, whose net assets are exposed to foreign currency translation risk. Currency exposure arising from the net assets of the Group’s foreign operations is managed primarily through transactions denominated in the relevant foreign currencies.
iv.The information on assets and liabilities denominated in foreign currencies whose values would be materially affected by the exchange rate fluctuations is as follows:

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June 30, 2015

			June30,	2015	2015	2015
(Foreign currency: functional currency) Financial assets Monetary items USD:NTD USD:RMB Non-monetary items USD:NTD Financial liabilities Monetary items USD:NTD USD:RMB (Foreign currency: functional currency) Financial assets Monetary items USD:NTD USD:RMB Non-monetary items USD:NTD Financial liabilities Monetary items USD:NTD USD:RMB	Foreign Currency Amount (In thousands)	Exchange Rate	Book Value (NTD)	SensitivityAnalysis
				Extent of Variation	Effect on Profit or (Loss)	Effect on Other Comprehensive Income(loss)
	USD 103,804 USD 60,075 USD 5,507 USD 101,032 USD 69,141				32,034 $ 18,539 - $ 31,178) ($ 21,337) (	- $ - 1,699 $ - $ -
	Foreign Currency Amount (In thousands)	Exchange Rate	Book Value (NTD)	SensitivityAnalysis
				Extent of Variation	Effect on Profit or (Loss)	Effect on Other Comprehensive Income(loss)
	USD 116,490 USD 108,490 USD 5,672 USD 119,272 USD 96,893	31.65 6.119 31.65 31.65 6.119	3,686,909 $ 3,433,709 179,520 $ 3,774,959 $ 3,066,663	1% 1% 1% 1% 1%	36,869 $ 34,337 - $ 37,750) ($ 30,667) (	- $ - 1,795 $ - $ -

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June 30, 2014

			June30,	2014	2014	2014
(Foreign currency: functional currency) Financial assets Monetary items USD:NTD USD:RMB Non-monetary items USD:NTD Financial liabilities Monetary items USD:NTD USD:RMB	Foreign Currency Amount (In thousands)	Exchange Rate	Book Value (NTD)	SensitivityAnalysis
				Extent of Variation	Effect on Profit or (Loss)	Effect on Other Comprehensive Income(loss)
	USD 196,319 USD 122,749 USD 10,062 USD 191,879 USD 113,252	29.865 6.1528 29.865 29.865 6.1528	5,863,067 $ 755,250 300,491 $ 5,730,466 $ 696,817	1% 1% 1% 1% 1%	58,631 $ 7,553 - $ 57,305) ($ 6,968) (	- $ - 3,005 $ - $ -

v.Total exchange gain (loss), including realised and unrealised arising from significant foreign exchange variation on the monetary items held by the Group for the three-month and six-month periods ended June 30, 2015 and 2014 amounted to ($1,990), $13,571, $3,231 and $13,987, respectively.

Interest rate risk

Interest risk arises from the changes of market interest rate causing fluctuation in financial instruments’ fair value or cash received and paid in the future.

The Group obtained short-term borrowings at fixed rates during the six-month period ended June 30, 2015, and thus had no significant cash flow interest rate risk.

Price risk

The Group is exposed to price risk because of investments held by the Group. The Group sets limits to control the transaction volume and stop-loss amount to reduce it’s market risk. b) Credit risk

i. Credit risk refers to the risk of financial loss to the Group arising from default by the clients or counterparties of financial instruments on the contract obligations. According to the Group’s credit policy, each local entity in the Group is responsible for managing and analyzing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. Internal risk control assesses the credit quality of the customers, taking into account their financial position, past experience and other factors. Individual risk limits are set based on internal or external

~42~

ratings, the utilization of credit limits is regularly monitored. Credit risk arises from cash and cash equivalents and deposits with banks and financial institutions, as well as credit exposures to customers, including outstanding receivables and committed transactions.

ii No credit limits were exceeded during the reporting periods, and management does not expect any significant losses from non-performance by these counterparties for the six-month periods ended June 30, 2015 and 2014.
iii.The individual analysis of financial assets that had been impaired is provided in the statement for each type of financial assets in Note 6.
iv.The credit quality information of financial assets that are neither past due nor impaired is provided in the statement in Note 6(4).
c) Liquidity risk
i. Cash flow forecasting is performed in the operating entities of the Group and aggregated by Group treasury. Group treasury monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities. Such forecasting takes into consideration the Group’s debt financing plans, and compliance with internal balance sheet ratio targets.
ii. Surplus cash held by the operating entities over and above the balance required for working capital management are transferred to the Group treasury. Group treasury invests surplus cash in interest bearing current accounts, time deposits and marketable securities, choosing instruments with appropriate maturities or sufficient liquidity to provide sufficient head-room as determined by the above-mentioned forecasts.
iii. The table below analyses the Group’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date for non-derivative financial liabilities. The amounts disclosed in the table are the contractual undiscounted cash flows.

Non-derivative financial liabilities:

Non-derivative financial liabilities:
June 30, 2015 Short-term borrowings Accounts payable Other payables Guarantee deposits received	Less than 1year 1,542,000 $ 2,346,376 741,052 6,023	Over 1year
		- $ - - -

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Non-derivative financial liabilities:

Non-derivative financial liabilities:
December 31, 2014 Short-term borrowings Accounts payable Other payables Guarantee deposits received Non-derivative financial liabilities: June 30, 2014 Short-term borrowings Accounts payable Other payables Guarantee deposits received	Less than 1year 1,410,000 $ 2,933,033 530,190 6,023 Less than 1year 1,000,000 $ 3,299,219 522,368 -	Over 1year
		- $ - - - Over 1year
		- $ - - 7,456

(3) Fair value estimation

A.The different levels that the inputs to valuation techniques are used to measure fair value of financial and non-financial instruments have been defined as follows:
Level 1:Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. A market is regarded as active where a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. The fair value of the Group’s investment in listed beneficiary certificates, on-the-run derivative instruments with quoted market prices is included in Level 1.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3:Unobservable inputs for the asset or liability. The fair value of the Group’s investment in equity investment without active market is included in Level 3.
B. The related information of financial and non-financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets and liabilities at June 30, 2015, December 31, 2014 and June 30, 2014 is as follows:

June 30, 2015 Assets Recurring fair value measurements Beneficiary Certificate	Level 1 402,846 $	Level 2 - $	Level3 - $	Total
				402,846 $

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December 31, 2014 Assets Recurring fair value measurements Financial assets at fair value through profit or loss Beneficiary Certificate June 30, 2014 Assets Recurring fair value measurements Financial assets at fair value through profit or loss Beneficiary Certificate	Level 1 362,155 $ Level 1 558,447 $	Level 2 - $ Level 2 - $	Level3 - $ Level3 - $	Total
				362,155 $
				Total
				558,447 $

C. The methods and assumptions the Group used to measure fair value are as follows:
(a)The instruments the Group used market quoted prices as their fair values (that is, Level 1) are listed below by characteristics:

Open-end fund

Net asset Market quoted price value

13. SUPPLEMENTARY DISCLOSURES

(1) Significant transactions information

A. Loans to others: None.
B. Provision of endorsements and guarantees to others: None.
C. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures) :Please refer to table 1.
D. Aggregate purchases or sales of the same securities reaching NT$300 million or 20% of paid-in capital or more: None.
E. Acquisition of real estate reaching NT$300 million or 20% of paid-in capital or more: None.
F. Disposal of real estate reaching NT$300 million or 20% of paid-in capital or more: None.
G. Purchases or sales of goods from or to related parties reaching NT100 million or 20% of paid-in capital or more:Please refer to table 2.
H. Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more: Please refer to table 3.

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I. Derivative financial instruments undertaken for the six-month period ended June 30, 2015: None.
J. Significant inter-company transactions for the six-month period ended June 30, 2015: Please refer to table 4.

(2) Information on investees

Names, locations and other information of investee companies (not including investees in Mainland China ): Please refer to table 5.

(3) Information on investments in Mainland China

A.The related information of investments in Mainland China: Please refer to table 6.
B.Significant transactions, either directly or indirectly throught a third area, with investee companies in the Mainland Area:
For the significant purchases, sales, accounts payable and accounts receivable transactions between the Company and the investee companies in Mainland China through its subsidiaries, please refer to Note 13(1) G 、 H and J.

14. SEGMENT INFORMATION

(1) General information

The Group mainly operates in one segment. The chief operating decision-maker reviews the Group’s reporting to assess performance and allocate resources. The Group mainly has a single reportable segment.

(2) Segment information

The Group has a single reportable segment. The revenue from external customers, the related gain or loss, and the assets correspond with the consolidated revenue, consolidated operating income, and consolidated assets.

(3) Reconciliation for segment income (loss), assets and liabilities

None.

~46~

Altek Corporation

Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures)

June 30, 2015

			June 30, 2015
Table 1 Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account		As ofJune	30,2015 Expressed in thousands of NTD (Except as otherwise indicated)
				Number of shares	Bookvalue	Ownership (%)	Fairvalue
Altek Corporation " " " Altek International Investment Co., Ltd. Altek (Kunshan) Co., Ltd. " Altek Investment Co., Ltd. Altek Autotronics Corporation Altek Biotechnology Corporation	Gianta Co., Ltd. - Common stock Pac-line Opportunity Fund - Common stock Yung Li Investments Inc. - Common stock Hua-chuang Automobile Information Technical Center Co., Ltd. - Common stock Money Market Fund Guangdong Kingding Optical Machine Co., Ltd. CPEC Huachuang Private Equity (Kunshan) Enterprise (Limited Partnership) Money Market Fund Money Market Fund Money Market Fund	Director Supervisor None None None None None None None None	Financial assets carried at cost - non-current " " " Financial assets at fair value through profit or loss-current Financial assets carried at cost - non-current " Financial assets at fair value through profit or loss-current " "	762,876 9,908,257 2,580,000 10,000,000 2,941 N/A N/A 434,074 23,381,984 56,051	10,312 $ 21,646 19,754 93,450 86,807 6,057 20,191 6,900 308,238 901	14.98% 7.06% 4.84% 2.00% N/A (Note 1) (Note 2) N/A N/A N/A	10,312 $ 21,646 19,754 93,450 86,807 6,057 20,191 6,900 308,238 901

Note 1: 8% of Guangdong kingding Optical Machine Co.,Ltd.’s capital contribution. Note 2: 1% of CPEC Huachuang Private Equity (Kunshan) Enterprise (Limited Partnership)’s capital contribution.

Table 1, Page 1

Altek Corporation

Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of paid-in capital or more

For the six-month period ended June 30, 2015

Table 2

Expressed in thousands of NTD (Except as otherwise indicated)

Purchaser/seller	Counterparty	Relationship with the counterparty		Transaction	Transaction		Differences in transaction terms compared to third party transactions	Differences in transaction terms compared to third party transactions	Notes/accounts receivable(payable)	Notes/accounts receivable(payable)
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unitprice	Credit term	Balance	Percentage of total notes/accounts receivable(payable)
Altek Corporation Altek International Investment Co., Ltd.	Altek International Investment Co., Ltd. Altek (Kunshan) Co., Ltd.	Parent and affiliated company "	Purchases Purchases	3,668,952 $ 3,886,872	99% 99%	Net 120 days Net 75 days	Approximately the same price with third parties "	Note "	3,047,323) ($ 495,545) (	99% 86%

Note: The payment term with third parties was net 60~120 days.

Table 2, Page 1

Altek Corporation

Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more

June 30, 2015

Table 3 Creditor	Counterparty	Relationship with the counterparty	Balance as atJune30,2015	Turnover rate	Overdue receivables	Overdue receivables	Amount collected subsequent to the balance sheet date Allowance for doubtful accounts Expressed in thousands of NTD (Except as otherwise indicated)	Amount collected subsequent to the balance sheet date Allowance for doubtful accounts Expressed in thousands of NTD (Except as otherwise indicated)
					Amount	Action taken
Altek International Investment Co., Ltd. Altek (Kunshan) Co., Ltd.	Altek Corporation Alteck International Investment Co., Ltd.	Parent company Parent company	3,047,323 $ 495,545	2.18 6.06	- $ -	N/A N/A	534,425 $ 495,545	- $ -

Table 3, Page 1

Altek Corporation

Table 4

Significant inter-company transactions during the reporting periods

For the six-month period ended June 30, 2015

Expressed in thousands of NTD

(Except as otherwise indicated)

Transaction

					Transaction
Companyname	Counterparty	Relationship (Note 1)	General ledger account	Amount	Transaction terms	Percentage of consolidated total operating revenues or total assets(Note 2)
Altek Corporation " Altek International Investment Co., Ltd. "	Altek International Investment Co., Ltd. " Altek (Kunshan) Co., Ltd. "	(1) (1) (3) (3)	Purchases Accounts payable Purchases Accounts payable	3,668,952 $ 3,047,323 3,886,872 495,545	Net 120 days " Net 75 days "	65% 20% 69% 3%

Note 1: Relationship between transaction and counterparty is classified into the following categories:

(1) Parent company to subsidiary.
(2) Subsidiary to parent company.
(3) Subsidiary to subsidiary.

Note 2: Regarding percentage of transaction amount to consolidated total operating revenues or total assets, it is computed based on period-end balance of transaction to consolidated total assets for balance sheet accounts and based on accumulated transaction amount for the period to consolidated total operating revenues for income statement accounts.

Note 3: The Company may decide to disclose or not to disclose transaction details in this table based on the Materiality Principle.

Table 4, Page 1

Company Name

Information on investees

Table 5

Expressed in thousands of NTD (Except as otherwise indicated)

For the six-month period ended June 30, 2015

Investor	Investee	Location	Main business activities	Initial invest	ment amount	Shares	held as at June 30,2015	held as at June 30,2015	Net profit (loss) of the investee for the six-month period ended June 30,2015	Investment income(loss) recognised by the Company for the six-month period ended June 30,2015	Footnote
				Balance as at June 30,2015	Balance as at December 31,2014	Number of shares	Ownership (%)	Book value
Altek Corporation " " " " Altek International Investment Co., Ltd. " Altek Semiconductor (Cayman) Co., Ltd.	Altek International Investment Co., Ltd. Altek Japan Corporation Altek Investment Co., Ltd. Altek Autotronics Corporation Altek Biotechnology Corporation Altek Lab Inc. JinJing Optical Technology Co., ltd. Altek Semiconductor Corporation	British Virgin Islands Japan Republic of China Republic of China Republic of China U.S.A. Samoa Republic of China	Investment and general business operations Sale and design of optical instruments Investment Research design, manufacture and sales of car electronic components Research and development, manufacture and sales of biotechnology Design service Investment and general business operations Research design and sales of ASIC	3,086,363 $ 2,869 50,000 177,500 1,000 113,557 108,010 200,000	3,086,363 $ 2,869 50,000 177,500 1,000 113,557 108,010 200,000	94,333,839 1,000 5,000,000 21,300,000 100,000 11,311,875 3,500,000 20,000,000	100% 100% 100% 98.02% 100% 100% 23.33% 100%	9,493,687 $ 11,214 26,309 320,159 956 57,052 31,478 191,729	5,542) ($ 186 31) ( 20,701 44) ( 973 31,133) ( 74,328	5,542) ($ 186 31) ( 20,291 44) ( 973 5,084) ( 74,328	Note 1 Note 2

Note 1: Ownership (%) on Altek Autotronics Corporation held by Altek Corporation and Altek Investment Co., Ltd. are 88.75% and 9.27%, respectively. Note 2: Common stock of 9,311,875 shares and preferred stock of 2,000,000 shares.

Table 5, Page 1

Company Name

Table 6

Information on investments in Mainland China

For the six-month period ended June 30, 2015

Expressed in thousands of NTD (Except as otherwise indicated)

Investee in Mainland China	Main business activities	Paid-in capital	Investment method `（`Note 1`）`	Accumulated amount of remittance from Taiwan to Mainland China as of January1,2015	Amount remitted from Taiwan to Mainland China/Amount remitted back to Taiwan for the Six-monthperiod ended June 30,2015	Amount remitted from Taiwan to Mainland China/Amount remitted back to Taiwan for the Six-monthperiod ended June 30,2015	Accumulated amount of remittance from Taiwan toMainland China as of June 30,2015	Net profit (loss) of investee for the six- month period ended Juen 30,2015	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the Six-month period ended June 30, 2015	Book value of investments in Mainland China as of June 30, 2015	Accumulated amount of investment income remitted back to Taiwan as of June 30,2015
					Remitted to Mainland China	Remitted back to Taiwan
Altek (Kunshan) Co., Ltd. (Note 2) Altek EMS (Kunshan) Co., Ltd. (Note 3) Altek Imaging Technology (Shanghai) Limited Altek Trading (Shanghai) Limited Kinko Optical (Suzhou) Co., Ltd. Phoenix Optical (Shanghai) Co., Ltd. Beijing Altek Image Communication Technology Co., Ltd.	Manufacture and sale of digital still cameras and its accessories Manufacture and sale of related engineering services Manufacture and sale of optical components Wholesale, import and export of related electronic and their associated accessories Manufacture and sale of optical components Manufacturing and marketing of digital cameras and its key components, photo sensor and optoelectronic equipment Sales of related electronic and their related accessories	1,530,656 $ 154,300 89,494 262,310 462,900 488,298 31,632	2 2 2 2 2 2 2	1,388,700 $ 280,301 89,494 262,310 108,010 273,556 -	- $ - - - - - -	- $ - - - - - -	1,388,700 $ 280,301 89,494 262,310 108,010 273,556 -	6,481 $ 7,837 134 7,741 ( 29,594) ( 10,915) -	100% 100% 100% 100% 23.33% 40% 100%	6,481 $ 7,837 134 7,741 ( 6,904) - -	4,231,516 $ 801,843 50,027 324,517 47,044 138,465 7	- $ - - - - - -

Table 6, Page 1

Company Name

Table 6

Information on investments in Mainland China

For the six-month period ended June 30, 2015

Expressed in thousands of NTD (Except as otherwise indicated)

Investee in Mainland China	Main business activities	Paid-in capital	Investment method `（`Note 1`）`	Accumulated amount of remittance from Taiwan to Mainland China as of January1,2015	Amount remitted from Taiwan to Mainland China/Amount remitted back to Taiwan for the Six-monthperiod ended June 30,2015	Amount remitted from Taiwan to Mainland China/Amount remitted back to Taiwan for the Six-monthperiod ended June 30,2015	Accumulated amount of remittance from Taiwan toMainland China as of June 30,2015	Net profit (loss) of investee for the six- month period ended Juen 30,2015	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the Six-month period ended June 30, 2015	Book value of investments in Mainland China as of June 30, 2015	Accumulated amount of investment income remitted back to Taiwan as of June 30,2015
					Remitted to Mainland China	Remitted back to Taiwan
Altek Precision (Kunshan) Co., Ltd. Altek Optical Technology (Kunshan) Co., Ltd.	Design, manufacture and sales of digital camera parts Manufacture and sales of related electronic services and its accessories and optical components	425,868 462,900	2 2	425,868 462,900	- -	- -	425,868 462,900	( 3,280) ( 49,818)	100% 100%	( 3,280) ( 49,818)	168,539 170,636	- -

Note 1:Investment methods are classified into the following three categories; fill in the number of category each case belongs to:

(1)Directly invest in a company in Mainland China.

(2)Through investing in an existing company in the third area, which then invested in the investee in Mainland China.

(3)Others.

Note 2: Including retained earnings capitalized of US$4,600 (In thousand of US dollars).

Note 3: Including retained earnings capitalized of US$3,600 (In thousand of US dollars).

Companyname	Accumulated amount of remittance from Taiwan to Mainland China as of June 30,2015	Investment amount approved by the Investment Commission of the Ministryof Economic Affairs(MOEA)	Ceiling on investments in Mainland China imposed bythe Investment Commission of MOEA
Altek Corporation	3,291,126 $	4,411,560 $	- $

Note:According to “REGULATIONS COVERNING THE APPROVAL OF INVESTMENT OR TECHNICAL IN MAINLAND CHINA”on August 29, 2008, Altek Corporation obtained the approval

from the Industrial Development Bureau of Ministry of Economics Affairs issued to Headquarters,so there is no need to compute the ceiling amount of the Company.

Table 6, Page 2

AI assistant

Altek — Interim / Quarterly Report 2015

52290_rns_2015-11-16_e1307a98-02b0-4806-a0c1-fb62ad2cc372.pdf

ALTEK CORPORATION AND SUBSIDIARIES

REVIEW REPORT OF INDEPENDENT ACCOUNTANTS TRANSLATED FROM CHINESE

To Altek Corporation

ALTEK CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

ALTEK CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

ALTEK CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

ALTEK CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

ALTEK CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2015 AND 2014

ALTEK CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX-MONTH PERIODS ENDED JUNE 30

ALTEK CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX-MONTH PERIODS ENDED JUNE 30

ALTEK CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX-MONTH PERIODS ENDED JUNE 30

1. HISTORY AND ORGANIZATION

2. THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL STATEMENTS AND PROCEDURES FOR AUTHORIZATION

3. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS

(3) IFRSs issued by IASB but not yet endorsed by the FSC

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(1) Compliance statement

(2) Basis of preparation

(3) Basis of consolidation

B. Subsidiaries included in the consolidated financial statements:

(4) Employee benefits

(5) Income tax

5. CRITICALACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF

ASSUMPTION UNCERTAINTY

(2) Critical accounting estimates and assumptions:

6. DETAILS OF SIGNIFICANT ACCOUNTS

(1) Cash

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

(3) Financial assets measured at cost

(5) Inventories

(6) Investments accounted for under the equity method

(7) Property, plant and equipment

(8) Intangible assets

(10) Short-term borrowings

(11) Pensions

(12) Share-based payments

(14) Share capital

B.Treasury shares

(15) Capital surplus

(16) Retained earnings

(17) Other equity items

(18) Other income

(19) Other gains and losses

(20) Finance costs

(22) Employee benefit expenses

(23) Income tax

(24) Earnings per share

(25) Operating leases

(26) Supplemental cash flow information

7. RELATED PARTY TRANSACTIONS

8. PLEDGED ASSETS

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNISED CONTRACT COMMITMENTS

(1) Contingencies

10. SIGNIFICANT DISASTER LOSS

11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE

12. OTHERS

(1) Capital risk management

(2) Financial instruments

Foreign exchange risk

Interest rate risk

Price risk

(3) Fair value estimation

Open-end fund

13. SUPPLEMENTARY DISCLOSURES

(1) Significant transactions information

(2) Information on investees

(3) Information on investments in Mainland China

14. SEGMENT INFORMATION

(1) General information

(2) Segment information

(3) Reconciliation for segment income (loss), assets and liabilities

Altek Corporation

Altek Interim / Quarterly Report 2015