ANDERSON — Annual Report 2021

Nov 9, 2021

Anderson Industrial Corporation and Subsidiaries

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

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DECLARATION OF CONSOLIDATION OF FINANCIAL STATEMENTS OF AFFILIATES

The entities that are required to be included in the consolidated financial statements of Anderson Industrial Corporation as of and for the year ended December 31, 2021 under the “Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises” are the same as those included in the consolidated financial statements prepared in conformity with the International Financial Reporting Standards No. 10 “Consolidated Financial Statements”. In addition, the information required to be disclosed in the consolidated financial statements is included in the consolidated financial statements. Consequently, Anderson Industrial Corporation and subsidiaries did not prepare a separate set of consolidated financial statements.

Very truly yours,

ANDERSON INDUSTRIAL CORPORATION

By

WEN JIA LIAO Chairman March 8, 2022

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INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Stockholders Anderson Industrial Corporation

Opinion

We have audited the accompanying consolidated financial statements of Anderson Industrial Corporation (the “Company”) and its subsidiaries (collectively referred to as the “Group”) which comprise the consolidated balance sheets as of December 31, 2021 and 2020, and the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the consolidated financial statements, including a summary of significant accounting policies (collectively referred to as the “consolidated financial statements”).

In our opinion, based on our audits and the report of other auditors (refer to the other matter paragraph), the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2021 and 2020, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with The Norm of Professional Ethics for Certified Public Accountant of the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements for the year ended December 31, 2021. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

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The key audit matters identified in the Group’s consolidated financial statements for the year ended December 31, 2021 are stated as follows:

Revenue Recognition

For the year ended December 31, 2021, the amount of the Group’s sales revenue from machineries was $2,379,896 thousand, which represented 66% of the total revenue. The terms of sales revenue from machineries may vary depending on individual customer, and a portion of the sales revenue from machineries is recognized at the time of completion of acceptance based on the terms of the transactions. Sales revenue from machineries may be recognized before the criteria of sales revenue recognition of machineries are met; therefore, we identified revenue recognition as a key audit matter. Refer to Notes 4 and 18 to the consolidated financial statements.

The main audit procedures that we performed in respect of revenue recognition included understanding the appropriateness of internal controls, testing the operating effectiveness of design and implementation’s effectiveness by inspecting sales contracts, confirming the consistency of transactions for revenue recognition, sampling of subsidiary ledgers, inspecting shipping invoices, clients’ receipts and export documentations, and verifying the accuracy of revenue recognition.

Estimated Impairment of Accounts Receivable

As of December 31, 2021, the balance of accounts receivable held by the Group was $667,023 thousand, which was significant and represented 13% of the total assets. The management applies the use of lifetime expected credit losses for all accounts receivable. The expected credit losses on accounts receivable are estimated by considering past default experience of the debtor, an analysis of the debtor’s current financial position and an assessment of both the current as well as the forecast direction of economic conditions at the reporting date. The evaluation of allowance for loss of accounts receivable, credit risk and appropriateness of provisioning policy involves significant judgments; therefore, we identified the estimated impairment of accounts receivable as a key audit matter. Refer to Notes 5 and 8 to the consolidated financial statements.

The main audit procedures that we performed in respect of the estimated impairment of accounts receivable included assessing the appropriateness of accounts receivable provisioning policy, testing the validity of aging reports, analyzing significant changes in accounts receivable and overdue accounts, assessing the reasonableness of impairment of individual accounts receivable, and confirming any indication of impairment at the end of the year.

Other Matter

Among the subsidiaries included in the consolidated financial statements of the Group, the financial statements of Sogotec Enterprise Co., Ltd. (Sogotec) were audited by other independent auditors. Our opinion expressed in the opinion section of this report, insofar as it relates to the amounts recognized based on financial statements audited by other auditors, is based solely on the reports of other auditors. As of December 31, 2020, Sogotec’s total assets amounted to $1,153,329 thousand, representing 23% of the consolidated total assets of the Group, and the total operating revenue amounted to $624,335 thousand, representing 19% of the consolidated total comprehensive income of the Group.

We have also audited the parent company only financial statements of the Group as of and for the years ended December 31, 2021 and 2020 on which we have issued an unmodified opinion with other matter paragraph and an unmodified opinion, respectively.

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

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

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

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

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

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

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

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

2. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.

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

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

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

7. Obtain sufficient and appropriate audit evidence regarding the financial information of entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision, and performance of the group audit. We remain solely responsible for our audit opinion.

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements for the year ended December 31, 2021 and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audits resulting in this independent auditors’ report are Pei De Chen and Li Wen Kuo.

Deloitte & Touche Taipei, Taiwan Republic of China

March 8, 2022

Notice to Readers

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

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

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ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2021 AND 2020

(In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 4 and 6) Financial assets at fair value through profit or loss (Notes 4 and 7) Financial assets at amortized cost (Notes 4 and 27) Notes receivable, net (Notes 4 and 8) Accounts receivable, net (Notes 4, 5, 8 and 27) Other receivables (Notes 4 and 27) Current tax assets Inventories (Notes 4 and 9) Prepayments Other current assets Total current assets NON-CURRENT ASSETS Financial assets at fair value through other comprehensive income (Note 4) Investments accounted for using the equity method (Note 4) Property, plant and equipment (Notes 4, 11 and 27) Right-of-use assets (Notes 4 and 12) Intangible assets (Notes 4 and 13) Deferred tax assets (Notes 4 and 20) Other non-current assets (Notes 11 and 27) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Notes 14 and 27) Contract liabilities (Note 18) Notes payable Accounts payable (Note 26) Other payables (Note 15) Current tax liabilities Provisions (Note 4) Lease liabilities (Notes 4 and 12) Current portion of long-term borrowings (Notes 14 and 27) Other current liabilities Total current liabilities NON-CURRENT LIABILITIES Long-term borrowings (Notes 14 and 27) Deferred tax liabilities (Notes 4 and 20) Lease liabilities (Notes 4 and 12) Net defined benefit liabilities (Notes 4 and 16) Other non-current liabilities Total non-current liabilities Total liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY (Note 17) Share capital Ordinary shares Capital surplus Unappropriated earnings (deficit to be compensated) Other equity Exchange differences on translation of the financial statements of foreign operations Unrealized (loss) gain on financial assets at fair value through other comprehensive income Total other equity Treasury shares Total equity attributable to owners of the Company NON-CONTROLLING INTERESTS Total equity TOTAL		2021 Amount % $ 811,824 16 86,880 2 214,420 4 297,688 6 667,023 13 113,724 2 2 - 1,298,131 25 81,107 2 35,528 1 3,606,327 71 69,076 1 6,409 - 1,033,759 20 111,418 2 103,177 2 127,460 3 43,963 1 1,495,262 29 $ 5,101,589 100 $ 1,158,356 23 234,212 5 1,437 - 452,826 9 165,164 3 15,276 - 21,674 - 26,083 1 139,642 3 18,087 - 2,232,757 44 453,423 9 1,764 - 79,326 1 33,960 1 9,517 - 577,990 11 2,810,747 55 1,993,310 39 233,024 5 216,565 4 (153,096) (3) (40,902) (1) (193,998) (4) (71,320) (1) 2,177,581 43 113,261 2 2,290,842 45 $ 5,101,589 100		2020
				Amount % $ 800,697 16 80,537 2 172,255 3 198,232 4 728,550 14 165,210 3 628 - 1,130,125 23 46,076 1 29,871 1 3,352,181 67 73,104 2 5,352 - 1,148,829 23 119,994 2 110,923 2 139,300 3 60,952 1 1,658,454 33 $ 5,010,635 100 $ 1,426,499 28 155,122 3 2,262 - 273,110 5 204,806 4 13,134 - 20,465 - 23,658 1 188,310 4 24,675 1 2,332,041 46 351,759 7 1,201 - 89,825 2 43,203 1 8,356 - 494,344 10 2,826,385 56 1,993,310 40 366,392 7 (114,235) (2) (113,832) (2) 9,556 - (104,276) (2) (71,320) (1) 2,069,871 42 114,379 2 2,184,250 44 $ 5,010,635 100

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

(With Deloitte & Touche auditors’ report dated March 8, 2022)

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ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

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

OPERATING REVENUE (Notes 4, 18 and 26) OPERATING COSTS (Notes 9, 19 and 26) GROSS PROFIT OPERATING EXPENSES (Notes 4, 19 and 26) Selling and marketing expenses General and administrative expenses Research and development expenses Expected credit (gain) loss Total operating expenses PROFIT (LOSS) FROM OPERATIONS NON-OPERATING INCOME AND EXPENSES (Notes 4 and 19) Interest income Other income (Note 22) Other gains and losses Finance costs Share of loss of associates accounted for using the equity method Total non-operating income and expenses PROFIT (LOSS) BEFORE INCOME TAX INCOME TAX (EXPENSE) BENEFIT (Notes 4 and 20) NET PROFIT (LOSS) FOR THE YEAR OTHER COMPREHENSIVE (LOSS) INCOME Items that will not be reclassified subsequently to profit or loss: Remeasurement of defined benefit plans		2021 Amount % $ 3,587,606 100 2,659,353 74 928,253 26 453,476 13 330,282 9 79,202 2 (5,603) - 857,357 24 70,896 2 6,365 - 60,942 2 178,333 5 (32,704) (1) (5,997) - 206,939 6 277,835 8 (58,863) (2) 218,972 6 (2,023) -		2020
				Amount % $ 3,210,946 100 2,356,460 73 854,486 27 421,350 13 409,566 13 82,159 3 73,152 2 986,227 31 (131,741) (4) 3,913 - 71,963 2 (31,861) (1) (34,186) (1) (3,623) - 6,206 - (125,535) (4) 7,516 - (118,019) (4) 5,652 - (Continued)

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ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

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

Unrealized (loss) gain on investments in equity instruments at fair value through other comprehensive income Income tax related to items that will not be reclassified subsequently to profit or loss (Note 20) Items that may be reclassified subsequently to profit or loss: Exchange differences on translation of the financial statements of foreign operations Other comprehensive (loss) income for the year, net of income tax TOTAL COMPREHENSIVE INCOME (LOSS) FOR THE YEAR NET PROFIT (LOSS) ATTRIBUTABLE TO: Owners of the Company Non-controlling interests TOTAL COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO: Owners of the Company Non-controlling interests EARNINGS (LOSSES) PER SHARE (Note 21) Basic Diluted		2021 Amount % $ (50,458) (1) 405 - (39,174) (1) (91,250) (2) $ 127,722 4 $ 218,222 6 750 - $ 218,972 6 $ 126,843 4 879 - $ 127,722 4 $ 1.14 $ 1.14		2020
				Amount % $ 2,056 - (1,130) - (3,832) - 2,746 - $ (115,273) (4) $ (118,733) (4) 714 - $ (118,019) (4) $ (115,782) (4) 509 - $ (115,273) (4) $ (0.61) $ (0.61)
		$		$
		$		$
		$		$
		$		$
		$		$

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

(With Deloitte & Touche auditors’ report dated March 8, 2022)

(Concluded)

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ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

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

BALANCE AT JANUARY 1, 2020 Appropriation of 2019 deficit Legal reserve to offset deficit Special reserve to offset deficit Capital surplus to offset deficit Cash dividends distributed from capital surplus Net (loss) profit for the year ended December 31, 2020 Other comprehensive income (loss) for the year ended December 31, 2020 Total comprehensive income (loss) for the year ended December 31, 2020 Buy-back of treasury shares Changes in percentage of ownership interests in subsidiaries Cash dividends paid to non-controlling interests of subsidiaries BALANCE AT DECEMBER 31, 2020 Capital surplus to offset deficit Cash dividends distributed from capital surplus Net profit for the year ended December 31, 2021 Other comprehensive loss for the year ended December 31, 2021 Total comprehensive income for the year ended December 31, 2021 Cash dividends paid to non-controlling interests of subsidiaries BALANCE AT DECEMBER 31, 2021		Equity Attributes to Owners of the Company		Total Equity Attributable to Owners of the Non-controlling Company Interests $ 2,231,756 $ 119,394 - - - - - - (19,933 ) - (118,733 ) 714 2,951 (205) (115,782) 509 (23,776 ) - (2,394 ) (3,518 ) - (2,006) 2,069,871 114,379 - - (19,133 ) - 218,222 750 (91,379) 129 126,843 879 - (1,997) $ 2,177,581 $ 113,261	Total Equity $ 2,351,150 - - - (19,933 ) (118,019 ) 2,746 (115,273) (23,776 ) (5,912 ) (2,006) 2,184,250 - (19,133 ) 218,972 (91,250) 127,722 (1,997) $ 2,290,842
	Ordinary shares Capital Surplus $ 1,993,310 $ 398,472 - - - - - (9,753 ) - (19,933 ) - - - - - - - - - (2,394 ) - - 1,993,310 366,392 - (114,235 ) - (19,133 ) - - - - - - - - $ 1,993,310 $ 233,024	Retained Earnings (Accumulated Deficits) Unr Unappropriated Earnings Exchange Differences on Translation of the Fi Fai (Deficit to be Financial Statement of Oth Legal Reserve Special Reserve Compensated) Foreign Operations $ 186,665 $ 75,178 $ (271,596 ) $ (110,229 ) (186,665 ) - 186,665 - - (75,178 ) 75,178 - - - 9,753 - - - - - - - (118,733 ) - - - 4,498 (3,603) - - (114,235) (3,603) - - - - - - - - - - - - - - (114,235 ) (113,832 ) - - 114,235 - - - - - - - 218,222 - - - (1,657) (39,264) - - 216,565 (39,264) - - - - $ - $ - $ 216,565 $ (153,096)	ealized Valuation Gain (Loss) on nancial Assets at r Value Through er Comprehensive Income Treasury Shares $ 7,500 $ (47,544 ) - - - - - - - - - - 2,056 - 2,056 - - (23,776 ) - - - - 9,556 (71,320 ) - - - - - - (50,458) - (50,458) - - - $ (40,902) $ (71,320)

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

(With Deloitte & Touche auditors’ report dated March 8, 2022)

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ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

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

CASH FLOWS FROM OPERATING ACTIVITIES Income (loss) before income tax Adjustments for: Depreciation expense Amortization expense Expected credit loss (reversed) recognized on accounts receivable Net gain on fair value changes of financial assets at financial assets at fair value through profit or loss Finance costs Interest income Share of loss of investments accounted for using the equity method Gain on disposal of property, plant and equipment Impairment losses recognized on financial assets Write-downs of inventories Loss on foreign currency exchange Provisions Government grants Gain on lease modification Changes in operating assets and liabilities Financial assets mandatorily classified as at fair value through profit or loss Notes receivable Accounts receivable Other receivables Inventories Prepayments Other current assets Contract liabilities Notes payable Accounts payable Other payables Provisions Other liabilities Net defined benefit liabilities Cash generated from operations Interest received Interest paid Income tax paid Net cash generated from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Purchase of financial assets at fair value through other comprehensive income Purchase of financial assets at amortized cost	2021 $ 277,835 110,442 6,158 (5,603) (1,982) 32,704 (6,365) 5,997 (218,820) 4,973 49,059 47,690 - (10,466) (47) (4,964) (99,456) 52,849 46,518 (253,428) (35,031) (5,657) 79,090 (825) 179,716 (37,881) 1,209 (3,124) (11,266) 199,325 6,360 (34,465) (43,287) 127,933 (46,430) (42,165)	2020 $ (125,535) 100,804 6,641 73,152 (2,797) 34,186 (3,913) 3,623 (92) - 76,071 31,068 (622) - - (57,165) (73,310) 125,698 (56,613) 178,714 18,900 (2,229) (38,586) 200 (105,867) (578) (8,126) 14,535 (6,052) 182,107 3,913 (35,491) (22,600) 127,929 (36,801) (53,546) (Continued)

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ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

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

Acquisition of investments accounted for using the equity method Payments for property, plant and equipment Proceeds from disposal of property, plant and equipment (Increase) decrease in refundable deposits Payments for intangible assets (Increase) decrease in non-current assets Increase in prepayments for equipment Net cash generated from (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES (Decrease) Increase in short-term borrowings Decrease in short-term notes and bills payable Proceeds from long-term borrowings Repayment of long-term borrowings Increase in guarantee deposits Repayment of the principal portion of lease liabilities Increase in other non-current liabilities Cash dividends paid Payments for treasury shares Dividends paid to non-controlling interests Changes in non-controlling interests Net cash (used in) generated from financing activities EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE OF CASH HELD IN FOREIGN CURRENCIES NET INCREASE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR	2021 $ (7,054) (45,411) 294,021 (628) (586) (515) (79) 151,153 (261,273) - 308,212 (247,551) - (25,396) 1,161 (19,133) - (1,997) - (245,977) (21,982) 11,127 800,697 $ 811,824	2020 $ - (78,005) 497 5,566 (182) 5,946 (10,605) (167,130) 245,662 (30,000) 226,207 (181,624) 400 (19,501) 854 (19,933) (23,776) (2,006) (5,912) 190,371 (12,412) 138,758 661,939 $ 800,697

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

(With Deloitte & Touche auditors’ report dated March 8, 2022)

(Concluded)

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ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

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

1. GENERAL INFORMATION

Anderson Industrial Corporation (the “Company”) was incorporated in the Republic of China (ROC) in July 1972. The Company is mainly engaged in the design, manufacture, sale and import and export of computer numerical control (CNC) machinery, tooling, lumber, wood panels, and building materials.

Since October 11, 2000, the Company’s shares have been listed on the Taiwan Stock Exchange (TWSE).

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

2. APPROVAL OF FINANCIAL STATEMENTS

The consolidated financial statements were approved by the Company’s board of directors on March 8, 2022.

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

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

The initial application of the IFRSs endorsed and issued into effect by the FSC did not have material impact on the Group’s accounting policies.

• b. The IFRSs endorsed by the FSC for application starting from 2022

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

• Note 1: The amendments to IFRS 9 will be applied prospectively to modifications and exchanges of financial liabilities that occur on or after the annual reporting periods beginning on or after January 1, 2022. The amendments to IAS 41 “Agriculture” will be applied prospectively to the fair value measurements on or after the annual reporting periods beginning on or after January 1, 2022. The amendments to IFRS 1 “First-time Adoptions of IFRSs” will be applied retrospectively for annual reporting periods beginning on or after January 1, 2022.

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• Note 2: The amendments are applicable to business combinations for which the acquisition date is on or after the beginning of the annual reporting period beginning on or after January 1, 2022.

• Note 3: The amendments are applicable to property, plant and equipment that are brought to the location and condition necessary for them to be capable of operating in the manner intended by management on or after January 1, 2021.

• Note 4: The amendments are applicable to contracts for which the entity has not yet fulfilled all its obligations on January 1, 2022.

As of the date the consolidated financial statements were authorized for issue, the Group is continuously assessing the possible impact that the application of other standards and interpretations will have on the Group’s financial position and financial performance and will disclose the relevant impact when the assessment is completed.

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

New IFRSs Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between An Investor and Its Associate or Joint Venture” IFRS 17 “Insurance Contracts” Amendments to IFRS 17 Amendments to IFRS 17 “Initial Application of IFRS 9 and IFRS 17—Comparative Information” Amendments to IAS 1 “Classification of Liabilities as Current or Non-current” Amendments to IAS 1 “Disclosure of Accounting Policies” Amendments to IAS 8 “Definition of Accounting Estimates” Amendments to IAS 12 “Deferred Tax related to Assets and Liabilities arising from a Single Transaction”

Effective Date Announced by IASB (Note 1)

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

• Note 1: Unless stated otherwise, the above New IFRSs are effective for annual reporting periods beginning on or after their respective effective dates.

• Note 2: The amendments will be applied prospectively for annual reporting periods beginning on or after January 1, 2023.

• Note 3: The amendments are applicable to changes in accounting estimates and changes in accounting policies that occur on or after the beginning of the annual reporting period beginning on or after January 1, 2023.

• Note 4: Except for deferred taxes that will be recognized on January 1, 2022 for temporary differences associated with leases and decommissioning obligations, the amendments will be applied prospectively to transactions that occur on or after January 1, 2022.

As of the date the consolidated financial statements were authorized for issue, the Group is continuously assessing the possible impact that the application of other standards and interpretations will have on the Group’s financial position and financial performance and will disclose the relevant impact when the assessment is completed.

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4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

• a. Statement of compliance

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

• b. Basis of preparation

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

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

• 1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;

• 2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and

• 3) Level 3 inputs are unobservable inputs for the asset or liability.

• c. Classification of current and non-current assets and liabilities

Current assets include:

• 1) Assets held primarily for the purpose of trading;

• 2) Assets expected to be realized within twelve months after the reporting period; and

• 3) Cash and cash equivalents unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

Current liabilities include:

• 1) Liabilities held primarily for the purpose of trading;

• 2) Liabilities due to be settled within twelve months after the reporting period, even if an agreement to refinance, or to reschedule payments, on a long-term basis is completed after the reporting period and before the consolidated financial statements are authorized for issue; and

• 3) Liabilities for which the Group does not have an unconditional right to defer settlement for at least twelve months after the reporting period.

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

• d. Basis of consolidation

Principles for preparing consolidated financial statements

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

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

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

All intra-group transactions, balances, income and expenses are eliminated in full upon consolidation. Total comprehensive income of subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

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

See Note 10 and Tables 7 and 8 for the detailed information of subsidiaries (including the percentage of ownership and main business).

e. Foreign currencies

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

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

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

Non-monetary items that are measured at historical cost in a foreign currency are not retranslated.

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

Goodwill and fair value adjustments on identifiable assets and liabilities acquired in the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated at the rate of exchange prevailing at the end of each reporting period. Exchange differences arising are recognized in other comprehensive income.

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f. Inventories

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

g. Investments in associates

An associate is an entity over which the Group has significant influence and which is neither a subsidiary nor an interest in a joint venture. The Group uses the equity method to account for its investments in associates.

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

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

When the Group’s share of losses of an associate equals or exceeds its interest in that associate (which includes any carrying amount of the investment accounted for using the equity method and long-term interests that, in substance, form part of the Group’s net investment in the associate), the Group discontinues recognizing its share of further loss, if any. Additional losses and liabilities are recognized only to the extent that the Group has incurred legal obligations, or constructive obligations, or made payments on behalf of that associate.

The entire carrying amount of an investment (including goodwill) is tested for impairment as a single asset by comparing its recoverable amount with its carrying amount. Any impairment loss recognized is not allocated to any asset, including goodwill, that forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognized to the extent that the recoverable amount of the investment subsequently increases.

h. Property, plant and equipment

Property, plant and equipment are stated at cost, less accumulated depreciation and accumulated impairment loss.

Except for freehold land which is not depreciated, the depreciation of property, plant and equipment is recognized using the straight-line method. Each significant part is depreciated separately. If the lease term is shorter than the useful lives, assets are depreciated over the lease term. The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis.

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

• i. Goodwill

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

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

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

• j. Intangible assets

• 1) Intangible assets acquired separately

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

• 2) Intangible assets acquired in a business combination

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

• 3) Derecognition of intangible assets

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

• k. Impairment of property, plant and equipment, right-of-use asset and intangible assets other than goodwill

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

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

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

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

l. Financial instruments

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

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

1) Financial assets

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

a) Measurement categories

Financial assets are classified into the following categories: Financial assets at FVTPL and financial assets at amortized cost and equity instruments at fair value through other comprehensive income (FVTOCI).

i. Financial assets at FVTPL

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

Financial assets at FVTPL are subsequently measured at fair value, with any gains or losses arising on remeasurement recognized in profit or loss. The net gain or loss recognized in profit or loss incorporates any dividends or interest earned on such a financial asset. Fair value is determined in the manner described in Note 25.

ii. Financial assets at amortized cost

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

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

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• ii) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Subsequent to initial recognition, financial assets at amortized cost, including cash and cash equivalents, financial assets at amortized cost, notes and accounts receivable (including long-term receivables) and other receivables, are measured at amortized cost, which equals the gross carrying amount determined using the effective interest method less any impairment loss. Exchange differences are recognized in profit or loss.

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

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

• iii. Investments in equity instruments at FVTOCI

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

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

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

• b) Impairment of financial assets

The Group recognizes a loss allowance for expected credit losses (ECLs) on financial assets at amortized cost, including accounts receivables.

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

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

The Group recognizes an impairment loss in profit or loss for all financial instruments with a corresponding adjustment to their carrying amount through a loss allowance account.

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• c) Derecognition of financial assets

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

On derecognition of a financial asset at amortized cost in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable is recognized in profit or loss.

• 2) Financial liabilities

• a) Subsequent measurement

All financial liabilities are measured at amortized cost using the effective interest method.

• b) Derecognition of financial liabilities

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

m. Provisions

Provisions are measured at the best estimate of the discounted cash flows of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation.

Provisions for the expected cost of warranty obligations are recognized at the date of sale of the relevant products, at the best estimate of the expenditure required to settle the Group’s obligation by the management of the Group.

• n. Revenue recognition

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

• 1) Revenue from the sale of goods

Revenue from the sale of goods comes from sales of precision machineries. Sales of precision machineries are recognized as revenue when the goods are shipped or accepted, and accounts receivable are recognized concurrently.

The Group does not recognize revenue on materials delivered to subcontractors because this delivery does not involve a transfer of control.

• 2) Revenue from the rendering of services

Revenue from the rendering of services comes from the repair services and hardware installation services.

As the Group provides repair services and hardware installation services. Consequently, the related revenue is recognized when services are rendered.

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o. Leases

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

1) The Group as lessor

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

Lease payments from operating leases are recognized as income on a straight-line basis over the terms of the relevant leases.

2) The Group as lessee

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

Right-of-use assets are initially measured at cost. Right-of-use assets are subsequently measured at cost less accumulated depreciation and impairment losses and adjusted for any remeasurement of the lease liabilities. Right-of-use assets are presented on a separate line in the balance sheets.

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

Lease liabilities are initially measured at the present value of the lease payments. The lease payments are discounted using the interest rate implicit in a lease, if that rate can be readily determined. If that rate cannot be readily determined, the Group uses the lessee’s incremental borrowing rate.

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

p. Government grants

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

Government grants related to income are recognized in other income on a systematic basis over the periods in which the Group recognizes as expenses the related costs that the grants intend to compensate.

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

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q. Employee benefits

• 1) Short-term employee benefits

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

• 2) Retirement benefits

Payments to defined contribution retirement benefit plans are recognized as an expense when employees have rendered service entitling them to the contributions.

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

The net defined benefit liability (asset) represents the actual deficit (surplus) in the Group’s defined benefit plan. Any surplus resulting from this calculation is limited to the present value of any refunds from the plans or reductions in future contributions to the plans.

3) Termination benefits

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

• r. Taxation

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

• 1) Current tax

Income tax payable (recoverable) is based on taxable profit (loss) for the year determined according to the applicable tax laws of each tax jurisdiction.

According to the Income Tax Law in the ROC, and additional tax on unappropriated earnings is provided for in the year the shareholders approve to retain earnings.

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

• 2) Deferred tax

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities and the corresponding tax bases used in the computation of taxable profit.

Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for deductible temporary differences or unused loss carryforward to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.

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

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

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

• 3) Current tax and deferred tax for the year

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

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

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

The Group considers the possible impact of the recent development of the COVID-19 in Taiwan and its economic environment implications when making its critical accounting estimates on cash flow projections, growth rate, discount rate, profitability, etc.The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

Key Sources of Estimation Uncertainty

Estimated impairment of financial assets

The provision for impairment of trade receivable is based on assumptions on probability of default and loss given default. The Group uses judgment in making these assumptions and in selecting the inputs to the impairment calculation, based on the Group’s historical experience and existing market conditions as of the end of each reporting period. For details of the key assumptions and inputs used, see Note 8. Where the actual future cash inflows are less than expected, a material impairment loss may arise.

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6. CASH AND CASH EQUIVALENTS

Cash on hand Checking accounts and demand deposits Cash equivalent Time deposits with original maturities less than three months		December 31	December 31
		2021 $ 5,471 786,160 20,193 $ 811,824	2020 $ 4,261 793,967 2,469 $ 800,697

The market rate intervals of cash in bank at the end of the reporting period were as follows:

Bank balance	December 31
	2021 2020 0%-1.24% 0%-1.24%

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

Financial assets mandatorily classified as at FVTPL Hybrid financial assets Structured deposits		**December **	**31 **
		2021 $ 86,880	2020 $ 80,537

8. NOTES RECEIVABLE AND ACCOUNTS RECEIVABLE

Notes receivable Accounts receivable At amortized cost Gross carrying amount Less: Allowance for impairment loss		December 31	December 31
		2021 $ 297,688 $ 841,130 (174,107) $ 667,023	2020 $ 198,232 $ 914,208 (185,658) $ 728,550

The average credit period of sales of goods was 90-180 days.

The Group measures the loss allowance for accounts receivable at an amount equal to lifetime expected credit losses. The lifetime ECLs on accounts receivable are estimated by reference to past collecting and default experiences of the debtor, an increase in deferred or overdue payments over average credit term and an analysis of the debtors’ current financial position, adjusted for general economic conditions of the industries in which the debtors operate. As the Group’s historical credit loss experience does not show significantly different loss patterns for different customer segments, the provision for loss allowance based on past due status is not further distinguished according to the Group’s different customer base.

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

The following table details the loss allowance for accounts receivable and notes receivable.

December 31, 2021

Gross carrying amount Loss allowance (Lifetime ECLs) Amortized cost December 31, 2020 Gross carrying amount Loss allowance (Lifetime ECLs) Amortized cost	Under 180 Days $ 1,005,012 (111,580) $ 893,432 Under 180 Days $ 818,681 (8,470) $ 810,211	181 to 365 Days Over 365 Days $ 42,666 $ 91,140 (12,118) (50,409) $ 30,548 $ 40,731 181 to 365 Days Over 365 Days $ 101,811 $ 191,948 (26,927) (150,261) $ 74,884 $ 41,687	Total $ 1,138,818 (174,107) $ 964,711 Total $ 1,112,440 (185,658) $ 926,782

The movements of the loss allowance for accounts receivable were as follows:

Balance at January 1 Add: Net remeasurement of loss allowance Less: Amounts written off Foreign exchange gains and losses Balance at December 31	For the Year Ended	For the Year Ended	December 31
		2021 $ 185,658 (5,603) (563) (5,385) $ 174,107	2020 $ 167,879 73,152 (56,233) 860 $ 185,658

Refer to Note 25 for details of the factoring agreements for notes receivable. Refer to Note 27 for details of collaterals that the Group held for these balances.

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9. INVENTORIES

Raw materials Work in progress Merchandise Inventory in transit Finished goods		December 31	December 31
		2021 $ 567,301 363,208 176,198 147,476 43,948 $ 1,298,131	2020 $ 390,299 356,429 246,225 96,273 40,969 $ 1,130,125

The cost of goods sold for the years ended December 31, 2021 and 2020 included inventory write-downs of $49,059 thousand and $76,071 thousand, respectively.

10. SUBSIDIARIES

• a. Subsidiaries included in the consolidated financial statements:

Investor Investee Nature of Activities The Company Anderson Industrial (Hong Kong) Ltd. Import, exporting and general investing activities Anderson Europe GmbH Manufacture and sale of machinery and service Anderson America Corporation (U.S.A.) (Anderson America) Sale of machinery and service CNT Industrial (Shanghai) Co., Ltd. (CNT) Manufacture and sale of woodworking machinery Anderson Logistics Corporation (Anderson Logistics) Import and exporting Jentec Machinery (Shanghai) Co., Ltd. (Jentec) Manufacture and sale of machinery Anderson Merchandise Corporation (Anderson Merchandise) Sale of wood panels and service Giben Holdings Co., Ltd. (BVI) (Giben BVI) Investment Giben Holdings Co., Ltd. (SAMOA) (Giben SAMOA) Investment Sogotec Enterprise Co., Ltd. (Sogotec) Manufacture and sale of machinery Anderson Logistics Sogotec Manufacture and sale of machinery Anderson Merchandise Sogotec Manufacture and sale of machinery Giben Samoa Giben America, Inc. (Giben America) Sale of machinery and service Giben do Brasil Maquinas e Equipamentos Ltda (Giben Brasil) Manufacture and sale of machinery Giben BVI Giben Brasil Manufacture and sale of machinery Anderson Europe GmbH MATEC GmbH (MATEC) Manufacture and sale of machinery Anderson Service GmbH (ASC) Sale of machinery and service Sogotec Sogotec Precision (Shanghai) Co., Ltd (Sogotec Shanghai) Sale of machinery and service

Proportion of Ownership December 31 2021 2020 Remark 100.00% 100.00% 1) 100.00% 100.00% - 100.00% 100.00% - 100.00% 100.00% - 100.00% 100.00% - 100.00% 100.00% - 100.00% 100.00% - 100.00% 100.00% - 100.00% 100.00% - 58.11% 57.82% - 21.97% 21.97% - 0.25% 0.25% - 100.00% 100.00% - 0.28% 0.28% - 99.72% 99.72% - 100.00% 100.00% - 100.00% 100.00% 2) 100.00% 100.00% -

• 1) The Group resolved to liquidate and dissolve the company. As of December 31, 2021, the process of liquidation is still ongoing.

• 2) ASC was set up in May 2020 under Anderson Europe GmbH with the amount of EUR25,000. Anderson Europe acquired 100% of ASC’s shares.

• b. Subsidiaries excluded from consolidated financial statements: None.

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11. PROPERTY, PLANT AND EQUIPMENT

Cost Balance at January 1, 2020 Additions Disposals Reclassification Effect of foreign currency exchange differences Balance at December 31, 2020 Accumulated depreciation and impairment Balance at January 1, 2020 Depreciation Disposals Reclassification Effect of foreign currency exchange differences Balance at December 31, 2020 Carrying amount at December 31, 2020 Cost Balance at January 1, 2021 Additions Disposals Reclassification Effect of foreign currency exchange differences Balance at December 31, 2021 Accumulated depreciation and impairment Balance at January 1, 2021 Depreciation Disposals Reclassification Effect of foreign currency exchange differences Balance at December 31, 2021 Carrying amount at December 31, 2021	Freehold Land $ 350,634 - - - 3,224 353,858 - - - - - - $ 353,858 $ 353,858 - (37,421 ) - (8,717) 307,720 - - - - - - $ 307,720	Buildings $ 1,071,814 14,739 (5,360 ) 4,455 (211) 1,085,437 451,066 44,544 (5,360 ) - (1,758) 488,492 $ 596,945 $ 1,085,437 12,070 (81,344 ) 3,488 (8,787) 1,010,864 488,492 43,900 (45,024 ) - (2,420) 484,948 $ 525,916	Machinery $ 196,904 55,288 (980 ) 11,014 (3,021) 259,205 101,969 14,091 (980 ) (112 ) (1,378) 113,590 $ 145,615 $ 259,205 2,035 (27,335 ) (1,496 ) (3,192) 229,217 113,590 15,954 (25,886 ) (715 ) (2,880) 100,063 $ 129,154	Research and Development Equipment $ 28,999 333 (5,652 ) 2,639 - 26,319 17,943 3,895 (5,652 ) - - 16,186 $ 10,133 $ 26,319 509 (5,894 ) (103 ) - 20,831 16,186 3,195 (5,894 ) (57 ) - 13,430 $ 7,401	Other Equipment $ 165,419 7,645 (18,833 ) 172 (3,006) 151,397 112,805 17,520 (18,428 ) - (2,778) 109,119 $ 42,278 $ 151,397 30,797 (5,125 ) 10,560 (5,781) 181,848 109,119 21,534 (5,114 ) - (7,259) 118,280 $ 63,568	Total $ 1,813,770 78,005 (30,825 ) 18,280 (3,014) 1,876,216 683,783 80,050 (30,420 ) (112 ) (5,914) 727,387 $ 1,148,829 $ 1,876,216 45,411 (157,119 ) 12,449 (26,477) 1,750,480 727,387 84,583 (81,918 ) (772 ) (12,559) 716,721 $ 1,033,759

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

Building Machinery Research and development equipment Other equipment

3-55 years 1-20 years 3-10 years 1-33 years

On May 3, 2021, the board of directors resolved to dispose of the land and buildings located in Xitun District, Taichung. The sale price was $290,888 thousand and the gain on disposal was $216,938 thousand. The registration for transfer of ownership was completed in August 2021.

In August 1996, the Company purchased land in Houlong Township of Miaoli County for $11,000 thousand. However, due to the statutory restrictions on the transfer of farmland, the title deed has not been legally transferred to the Company; therefore, the Company entered into a contract with the seller to prevent any future claims on the land by the seller, the seller’s heir at law, or any other third parties. In addition, if the land zoning is changed, the seller is obligated to transfer the title immediately. Accordingly, the farmland is recorded under other non-current assets. In March 2005, the Company applied to the Land Office for the modification of land usage and changed parts of the land’s zoning designation from farmland to construction use, which amounted to $4,518 thousand. Accordingly, the Company has been registered as the legal owner, and has reclassified such land to property, plant and equipment.

Property, plant and equipment pledged as collateral for bank borrowings were set out in Note 27.

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12. LEASE ARRANGEMENTS

a. Right-of-use assets

Carrying amount Land Buildings Transportation equipment Additions to right-of-use assets Depreciation charge for right-of-use assets Land Buildings Transportation equipment		**December 31 **	**December 31 **
	2021 $ 22,011 63,542 25,865 $ 111,418 **For the Year Ended **		2020 $ 25,435 73,437 21,122 $ 119,994 **December 31 **
		2021 $ 18,740 $ 3,339 10,591 11,929 $ 25,859	2020 $ 101,019 $ 3,335 9,074 8,345 $ 20,754

• b. Lease liabilities

Carrying amount Current Non-current Range of discount rate for lease liabilities was as follows: Land Buildings Transportation equipment		December	31
		2021 $ 26,083 $ 79,326 **December **	2020 $ 23,658 $ 89,825 **31 **
	2021 2020 1.71% 1.71% 1.45%-1.71% 1.45%-1.71% 1.41%-1.74% 1.45%-1.74%

• c. Material lease-in activities and terms

The Group leases land and buildings for the use of plants and offices with lease terms of 2 to 10 years. The Group does not have bargain purchase options to acquire the leasehold land and buildings at the end of the lease terms. In addition, the Group is prohibited from subleasing or transferring all or any portion of the underlying assets without the lessor’s consent.

-29-

d. Other lease information

Expenses relating to short-term leases Total cash outflow for leases	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 33,733 $ (60,737)	2020 $ 26,729 $ (47,716)

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

The amount of lease commitments for short-term leases for which the recognition exemption is applied were $1,630 thousand and $2,416 thousand as of December 31, 2021 and 2020, respectively.

13. INTANGIBLE ASSETS

Cost Balance at January 1, 2020 Additions Reclassification Effect of foreign currency exchange differences Balance at December 31, 2020 Accumulated amortization and impairment Balance at January 1, 2020 Amortization expense Effect of foreign currency exchange differences Balance at December 31, 2020 Carrying amount at December 31, 2020 Cost Balance at January 1, 2021 Additions Effect of foreign currency exchange differences Balance at December 31, 2021 Accumulated amortization and impairment Balance at January 1, 2021 Amortization expense Effect of foreign currency exchange differences Balance at December 31, 2021 Carrying amount at December 31, 2021	Goodwill $ 51,828 - - (1,955) 49,873 12,745 - - 12,745 $ 37,128 $ 49,873 - (1,043) 48,830 12,745 - - 12,745 $ 36,085	Patent $ 58,672 - 1,541 (467) 59,746 54,225 1,572 127 55,924 $ 3,822 $ 59,746 - (834) 58,912 55,924 1,491 (726) 56,689 $ 2,223	Trademark $ 62,145 - - (1,425) 60,720 - - - - $ 60,720 $ 60,720 - (760) 59,960 - - - - $ 59,960	Software $ 22,038 99 - 563 22,700 14,717 1,801 568 17,086 $ 5,614 $ 22,700 17 (1,479) 21,238 17,086 1,804 (1,473) 17,417 $ 3,821	Technical Drawing $ 15,355 83 - 656 16,094 8,690 3,268 497 12,455 $ 3,639 $ 16,094 569 (1,732) 14,931 12,455 2,863 (1,475) 13,843 $ 1,088	Total $ 210,038 182 1,541 (2,628) 209,133 90,377 6,641 1,192 98,210 $ 110,923 $ 209,133 586 (5,848) 203,871 98,210 6,158 (3,674) 100,694 $ 103,177

The above items of intangible asset are amortized on a straight-line basis over the estimated useful lives as follows:

Patents 5-20 years Software 3-5 years Technical drawing 5 years

-30-

The Group acquired 100% interest of Giben Brasil in September 2014. After the acquisition, the actual profitability of Giben Brasil was below expectation; therefore, accumulated impairment loss on goodwill of $12,745 thousand was recognized for the year ended December 31, 2021.

Management believes the Group will renew the trademark continuously and has the ability to do so. Various studies including studies about product life cycle, market, competitive and environmental trends, and brand extension opportunities have been performed by management of the Company, which supported the opinion that there is no foreseeable limit to the period over which the trademarked products are expected to generate net cash flows. Therefore, the trademark is considered to have an indefinite useful life. The trademark will not be amortized until its useful life is determined to be finite. Instead it will be tested for impairment annually and whenever there is an indication that it may be impaired.

14. BORROWINGS

• a. Short-term borrowings

Secured borrowings (Note 27) Bank loans Unsecured borrowings Bank loans Loans from the government		December 31	December 31
		2021 $ 751,903 402,407 4,046 $ 1,158,356	2020 $ 645,608 769,439 11,452 $ 1,426,499

The range of interest rates on bank loans were 0.85%-1.35% and 0.85%-3.60% per annum as of December 31, 2021 and 2020, respectively.

Due to the impact of the Covid-19 pandemic, the United States federal government signed the CARES Act and established the Paycheck Protection Program (PPP) in order to help small-medium companies maintain their day-to-day business operations during the economic crisis by means of salaries paid to workers and creation of jobs

The subsidiary of the Group in the United States obtained loans of US$597 thousand and US$146 thousand, which were approved by financial institution and authorized by U.S. Small Business Administration (SBA) in May 2020 and April 2021, respectively. The loan is mainly used to pay the salaries of employees and related welfare expenditures. The subsidiary may apply for loan forgiveness if it meets all specific conditions. The principal and interest of loan that have not been forgiven must be paid off within 2 years at a fixed interest rate of 1%. The subsidiary had applied for loan exemption, of which US$195 thousand and US$402 thousand were approved and transferred to other income for reducing administrative expenses in 2020 and 2021, respectively. The remaining part of the loan is still waiting for approval and has not been recognized as income from government grants.

-31-

b. Long-term borrowings

Secured borrowings (Note 27) Bank loans (1) Other loans (2) Unsecured borrowings Bank loans Less: Current portion Long-term borrowings		December 31	December 31
		2021 $ 467,138 19,077 106,850 593,065 (139,642) $ 453,423	2020 $ 384,342 27,652 128,075 540,069 (188,310) $ 351,759

• 1) As of December 31, 2021 and 2020, the interest rates of the bank borrowings secured by the Group’s financial assets at amortized cost, accounts receivable, other receivables, freehold land and buildings were 1.42%-2.40% and 1.45%-2.40% per annum, respectively. The bank borrowings are due from March 2024 to December 2035.

• 2) As of December 31, 2021 and 2020, the interest rates of other borrowings from CHAILEASE CONSUMER FINANCE CO., LTD. secured by the Group’s accounts receivable were 4.72%-11.03% and 9.06%-10.40% per annum, respectively. The borrowings are due from June 2022 to August 2023.

15. OTHER PAYABLES

Payables for salaries and bonuses Payables for commission Payables for business taxes Payables for compensation of employees and remuneration to directors and supervisors Payables for interest Others		**December 31 **	**December 31 **
		2021 $ 113,688 21,955 10,805 8,101 869 9,746 $ 165,164	2020 $ 84,089 23,200 11,864 3,856 1,204 80,593 $ 204,806

16. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

The Company, Sogotec, Anderson Merchandise and Anderson Logistic adopted a pension plan under the Labor Pension Act (LPA), which is a state-managed defined contribution plan. Under the LPA, an entity makes monthly contributions to employees’ individual pension accounts at 6% of monthly salaries and wages.

The employees of the Group’s subsidiaries in other countries are members of state-managed retirement benefit plans operated by the local government. The subsidiary is required to contribute amounts equal to a specified percentage of payroll costs to the retirement benefit scheme to fund the benefits. The only obligation of the Group with respect to the retirement benefit plan is to make the specified contributions.

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b. Defined benefit plans

The defined benefit plans adopted by the Company and Sogotec in accordance with the Labor Standards Law are operated by the government. Pension benefits are calculated on the basis of the length of service and average monthly salaries of the six months before retirement. The Company and Sogotec contribute amounts equal to 2% of total monthly salaries and wages to a pension fund administered by the pension fund monitoring committee. Pension contributions are deposited in the Bank of Taiwan in the committee’s name. Before the end of each year, the Group assesses the balance in the pension fund. If the amount of the balance in the pension fund is inadequate to pay retirement benefits for employees who conform to retirement requirements in the next year, the Group is required to fund the difference in one appropriation that should be made before the end of March of the next year. The pension fund is operated and managed by the Bureau of Labor Funds, Ministry of Labor (the “Bureau”); as such, the Group does not have any right to intervene in the investment policy and strategy.

The amounts included in the consolidated balance sheets in respect of the Group’s defined benefit plans were as follows:

Present value of defined benefit obligation Fair value of plan asset Net defined benefit liability		**December 31 **	**December 31 **
		2021 $ 104,970 (71,010) $ 33,960	2020 $ 101,116 (57,913) $ 43,203

Movements in net defined benefit liability were as follows:

	Present Value of
	the Defined		Net Defined
	Benefit	Fair Value of		Benefit
	Obligation	the Plan Assets	Liability
Balance at January 1, 2020	$ 125,701	$ (70,818)	$	54,883
Service cost
Current service cost	668	-		668
Net interest expense (income)	956	(546)		410
Recognized in profit or loss	1,624	(546)		1,078
Remeasurement
Return on plan assets (excluding amounts
included in net interest)	-	(2,218)		(2,218)
Actuarial loss - changes in demographic
assumptions	16	-		16
Actuarial loss - changes in financial
assumptions	2,471	-		2,471
Actuarial gain - experience adjustments	(5,686)	-		(5,686)
Recognized in other comprehensive
income	(3,199)	(2,218)		(5,417)
Contributions from the employer	-	(7,341)		(7,341)
Benefits paid from plan assets	(23,010)	23,010		-
	(23,010)	15,669		(7,341)
Balance at December 31, 2020	101,116	(57,913)		43,203
				(Continued)

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	Present Value of	Present Value of
	the Defined				Net Defined
		Benefit	Fair Value of			Benefit
	Obligation		the Plan Assets		Liability
Service cost
Current service cost	$	398	$	-	$	398
Net interest expense (income)		506		(296)		210
Recognized in profit or loss		904		(296)		608
Remeasurement
Return on plan assets (excluding amounts
included in net interest)		-		(927)		(927)
Actuarial loss - changes in demographic
assumptions		3,007		-		3,007
Actuarial gain - changes in financial
assumptions		(1,602)		-		(1,602)
Actuarial loss - experience adjustments		1,545		-		1,545
Recognized in other comprehensive
income		2,950		(927)		2,023
Contributions from the employer		-		(11,874)		(11,874)
Balance at December 31, 2021	$	104,970	$	(71,010)	$	33,960
						(Concluded)

Through the defined benefit plans under the Labor Standards Law, the Group is exposed to the following risks:

• 1) Investment risk: The plan assets are invested in domestic and foreign equity and debt securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau or under the mandated management. However, in accordance with relevant regulations, the return generated by plan assets should not be below the interest rate for a 2-year time deposit with local banks.

• 2) Interest risk: A decrease in the government bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the plan’s debt investments.

• 3) Salary risk: The present value of the defined benefit obligation is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the present value of the defined benefit obligation.

The actuarial valuations of the present value of the defined benefit obligation were carried out by qualified actuaries. The significant assumptions used for the purposes of the actuarial valuations were as follows:

Discount rates Expected rates of salary increase	**December 31 **
	2021 2020 0.625% 0.500% 2.750%-3.500% 2.750%-3.750%

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If possible reasonable change in each of the significant actuarial assumptions will occur and all other assumptions will remain constant, the present value of the defined benefit obligation would increase (decrease) as follows:

Discount rate(s) 0.25% increase 0.25% decrease Expected rate(s) of salary increase 0.25% increase 0.25% decrease		**December **	**31 **
		2021 $ (2,551) $ 2,642 $ 2,540 $ (2,466)	2020 $ (2,630) $ 2,727 $ 2,618 $ (2,538)

The sensitivity analysis presented above may not be representative of the actual change in the present value of the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

The expected contributions to the plan for the next year The average duration of the defined benefit obligation		**December **	**31 **
		2021 2020 $ 3,635 $ 12,497 9.50-12.20 years 10.20-13.20 years

17. EQUITY

• a. Share capital

Ordinary shares

Number of shares authorized (in thousand) Shares authorized Number of shares issued and fully paid (in thousand) Shares issued		December 31	December 31
		2021 300,000 $ 3,000,000 199,331 $ 1,993,310	2020 300,000 $ 3,000,000 199,331 $ 1,993,310

A holder of issued ordinary shares with par value of NT$10 per share is entitled to vote and to receive dividends.

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b. Capital surplus

May be used to offset a deficit, distributed as cash dividends, or transferred to share capital (1) Issuance of ordinary shares Conversion of bonds Treasury share transactions Difference between consideration and carrying amount arising from the acquisition disposal of subsidiaries’ shares May only be used to offset a deficit Changes in percentage of ownership interests in subsidiaries (2) May not be used for any purpose Employee share options		December 31	December 31
		2021 $ 111,870 99,979 8,790 12,201 - 184 $ 233,024	2020 $ 131,003 99,979 59,673 12,201 63,352 184 $ 366,392

• 1) Such capital surplus may be used to offset a deficit; in addition, when the Company has no deficit, such capital surplus may be distributed as cash dividends or transferred to share capital (limited to a certain percentage of the Company’s number of shares fully paid).

• 2) Such capital surplus arises from the effect of changes in ownership interests in subsidiaries resulting from equity transactions other than actual disposals or acquisitions, or from changes in capital surplus of subsidiaries accounted for using the equity method.

c. Retained earnings and dividend policy

Under the dividends policy as set forth in the amended Articles, where the Company made a profit in a fiscal year, the profit shall be first utilized for paying taxes, offsetting losses of previous years, setting aside as a legal reserve of 10% of the remaining profit, setting aside or reversing a special reserve in accordance with the laws and regulations, and then any remaining profit together with any undistributed retained earnings shall be used by the Company’s board of directors as the basis for proposing a distribution plan with a proportion of no less than 10%, which should be resolved in the shareholders’ meeting for the distribution of dividends and bonuses to shareholders. For the policies on the distribution of compensation of employees and remuneration of directors after the amendment, refer to compensation of employees and remuneration of directors in Note 19-f.

According to the Articles of Incorporation of the Company, 30%-100% of dividends are to be distributed as cash dividends and 0%-70% as share dividends.

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

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The appropriation of deficit for 2020 and 2019 were approved in the shareholders’ meeting on July 2, 2021 and May 27, 2020, respectively as follows:

Legal reserve Special reserve Capital surplus	Appropriation of Deficits
	For the Year Ended December 31
	2020 2019 $ - $ 186,665 - 75,178 114,235 9,753

In the shareholders’ meeting on July 2, 2021 and May 27, 2020, the Company’s shareholders resolved to issue cash dividends from capital surplus of $19,133 thousand and $19,933 thousand, respectively.

On March 8, 2022, the Company’s board of directors proposed an earning distribution for 2021 which is subject to resolution of the shareholders in their meeting to be held on May 30, 2022.

• d. Treasury shares

Purpose of Buy-back Number of Shares at January 1 Shares Transferred to Employees 2021 Shares transferred to employees (in thousands of shares) 8,000 - 2020 Shares transferred to employees (in thousands of shares) 5,000 3,000	Shares Cancelled Number of Shares at December 31 - 8,000 - 8,000

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

18. REVENUE

Revenue from the sale of goods Revenue from the rendering of services Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 3,509,882 75,714 2,010 $ 3,587,606	2020 $ 3,132,720 75,263 2,963 $ 3,210,946

• a. Refer to Notes 4-n and 32 for information about contract information and disaggregation of revenue.

• b. Contract balances: As of December 31, 2021 and 2020, the amounts of contract liabilities were $234,212 thousand and $155,122 thousand, respectively, which mainly comprised of unearned receipts.

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19. NET INCOME (LOSS)

a. Other income

Subsidy income Rental income Others Other gains and losses Gain on disposal of property, plant and equipment Net foreign exchange losses Impairment losses on financial assets Net gain on financial assets at FVTPL Others	**For the Year Ended December 31 **	**For the Year Ended December 31 **	**For the Year Ended December 31 **
	2021 2020 $ 12,117 $ 39,034 8,932 3,683 39,893 29,246 $ 60,942 $ 71,963 **For the Year Ended December 31 **
		2021 $ 218,820 (35,944) (4,973) 1,982 (1,552) $ 178,333	2020 $ 92 (36,634) - 2,797 1,884 $ (31,861)

• b. Other gains and losses

c. Finance costs

Interest on bank loans Interest on lease liabilities Depreciation and amortization Property, plant and equipment Right-of-use assets Intangible assets An analysis of depreciation by function Operating costs Operating expenses An analysis of amortization by function Operating expenses	For the Year Ended	For the Year Ended	December 31
	2021 $ 31,096 1,608 $ 32,704 For the Year Ended		2020 $ 32,700 1,486 $ 34,186 December 31
		2021 $ 84,583 25,859 6,158 $ 116,600 $ 39,404 71,038 $ 110,442 $ 6,158	2020 $ 80,050 20,754 6,641 $ 107,445 $ 31,177 69,627 $ 100,804 $ 6,641

d. Depreciation and amortization

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e. Employee benefits expense

Short-term benefits Post-employment benefits Defined contribution plans Defined benefit plans (Note 16) Other employee benefits Total employee benefits expense An analysis of employee benefits expense by function Operating costs Operating expenses	For the Year Ended	For the Year Ended	December 31
		2021 $ 667,296 17,968 608 18,576 27,863 $ 713,735 $ 124,711 589,024 $ 713,735	2020 $ 746,828 15,515 1,078 16,593 18,010 $ 781,431 $ 128,014 653,417 $ 781,431

f. Compensation of employees and remuneration of directors

According to the Articles of Incorporation of the Company, the Company accrues compensation of employees and remuneration of directors at the rates of 1%-10% and no higher than 3%, respectively, of net profit before income tax, compensation of employees, and remuneration of directors. Resulting from a loss for the year ended 2020, no estimation for employees’ compensation and remuneration of directors was made. The employees’ compensation and remuneration of directors for the years ended December 31, 2021 which have been approved by the Company’s board of directors on March 8, 2022 were as follows:

Accrual rate

Compensation of employees Remuneration of directors Amount	For the Year Ended December 31
	2021 1% 1%

Compensation of employees Remuneration of directors	For the Year Ended **December 31 **	For the Year Ended **December 31 **
		2021 $ 2,593 $ 2,593

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

Information on the compensation of employees and remuneration of directors resolved by the Company’s board of directors is available at the Market Observation Post System website of the Taiwan Stock Exchange.

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20. INCOME TAXES

• a. Income tax recognized in profit or loss:

Major components of income tax expense (benefit) are as follows:

Current tax In respect of the current year Income tax on unappropriated earnings Adjustments for prior years Land value increment tax Deferred tax In respect of the current year Income tax expense (benefit) recognized in profit or loss	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 23,487 647 (1,090) 23,011 46,055 12,808 $ 58,863	2020 $ 10,057 320 6,342 99 16,818 (24,334) $ (7,516)

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

b.	Net profit (loss) before income tax Income tax expense (benefit) calculated at the statutory rate Adjustment items in determining taxable profit and loss carryforwards Adjustments for prior years’ tax Nondeductible expenses in determining taxable income Temporary differences Income tax on unappropriated earnings Land value increment tax Tax-exempt income Effect of different tax rate of entities in the Group operating in other jurisdictions Income tax expense (benefit) recognized in profit or loss Income tax recognized in other comprehensive income Deferred tax In respect of the current period Remeasurement on defined benefit plan	**For the Year Ended **	**For the Year Ended **	**December 31 **
		2021 $ 277,835 $ 55,567 17,544 (1,090) 1,064 (188) 647 23,011 (46,246) 8,554 $ 58,863 **For the Year Ended **		2020 $ (125,535) $ (25,107) 14,584 6,342 4,487 785 320 99 (4,259) (4,767) $ (7,516) **December 31 **
			2021 $ (405)	2020 $ 1,130

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c. Deferred tax assets and liabilities

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

For the year ended December 31, 2021

					Recognized in	Recognized in	Recognized in
						Other
			Recognized in		Comprehensive
	Opening Balance		Profit or Loss		Income			Closing Balance
Deferred tax assets
Defined benefit obligation	$	8,919	$	(2,253 )	$	405		$	7,071
Inventory write-downs		31,191		1,866			-		33,057
Unrealized foreign exchange loss		5,708		882			-		6,590
Share of loss of subsidiaries accounted for using the
equity method		40,054		(6,277 )			-		33,777
Others		53,428		(6,463)			-		46,965
	$	139,300	$	(12,245 )	$	405		$	127,460
Deferred tax liabilities
Share of profit of subsidiaries accounted for using the
equity method	$	1,201	$	563	$		-	$	1,764
For the year ended December 31, 2020
					Recognized in
						Other
			Recognized in		Comprehensive
	Opening Balance		Profit or Loss		Income			Closing Balance
Deferred tax assets
Defined benefit obligation	$	11,282	$	(1,233 )	$	(1,130 )		$	8,919
Inventory write-downs		26,475		4,716			-		31,191
Unrealized foreign exchange loss		10,178		(4,470 )			-		5,708
Share of loss of subsidiaries accounted for using the
equity method		16,679		23,375			-		40,054
Others		50,281		3,147			-		53,428
	$	114,895	$	25,535	$	(1,130)		$	139,300
Deferred tax liabilities
Share of profit of subsidiaries accounted for using the
equity method	$	-	$	1,201	$		-	$	1,201

d. Information about unused loss carryforwards

Unused loss carryforward as of December 31, 2021 comprised:

Unused Amount	Expiry Year
$ 138,398	2025
38,564	2026
24,133	2029
14,180	2030
26,593	2031
$ 241,868

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e. Income tax assessments

The latest annual income tax returns that have been assessed by the tax authorities were as follows:

Company The Company Anderson Merchandise Anderson Logistics Sogotec	**Year **
	2019 2019 2019 2019

21. EARNINGS (LOSS) PER SHARE

EARNINGS (LOSS) PER SHARE
Basic earnings (loss) per share Diluted earnings (loss) per share	Unit: NT$ Per Share For the Year Ended December 31
		2021 $ 1.14 $ 1.14	2020 $ (0.61) $ (0.61)

The earnings (loss) and weighted average number of ordinary shares outstanding in the computation of earnings (loss) per share were as follows:

Net Income (Loss) for the Year

Earnings (loss) used in the computation of basic/diluted earnings (loss) per share	For the Year Ended	For the Year Ended	December 31
		2021 $ 218,222	2020 $ (118,733)

Weighted average number of ordinary shares outstanding (in thousands of shares):

Weighted average number of ordinary shares in computation of basic earnings (loss) per share Effect of potentially dilutive ordinary shares Compensation of employees Weighted average number of ordinary shares used in the computation of diluted earnings (loss) per share	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 191,331 217 191,548	2020 193,138 - 193,138

The Group may settle the compensation of employees in cash or shares; therefore, the Group assumed that the entire amount of the compensation will be settled in shares, and the resulting potential shares are included in the weighted average number of shares outstanding used in the computation of diluted earnings per share, as the effect is dilutive. Such dilutive effect of the potential shares is included in the computation of diluted earnings per share until the number of shares to be distributed to employees is resolved in the following year.

22. GOVERNMENT GRANTS

In addition to those described in Note 14, the Group obtained a subsidy in the amount of $21,297 thousand from the government in accordance with the handling of salary and working capital subsidies for difficult businesses of manufacturing and technical service industries that are affected by severe pneumonia with novel pathogens by the Ministry of Economic Affairs in 2020.

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23. EQUITY TRANSACTIONS WITH NON-CONTROLLING INTERESTS

In June 2020, Sogotec bought back its ordinary shares, which increased the Group’s continuing interest from 79.94% to 80.33%.

The above transactions were accounted for as equity transactions, since the Company did not cease to have control over these subsidiaries.

Cash consideration received The proportionate share of the carrying amount of the net assets of the subsidiary transferred from non-controlling interests Differences recognized from equity transactions Line items adjusted for equity transactions Capital surplus - changes in percentage of ownership interests in subsidiaries	For the Year Ended December 31	For the Year Ended December 31
		2020 $ (5,912) 3,518 $ (2,394) $ (2,394)

24. CAPITAL MANAGEMENT

The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns while maximizing the return to stakeholders through the optimization of the debt and equity balance.

The capital structure of the Group consists of net debt (borrowings offset by cash and cash equivalents) and equity of the Group (comprising issued capital, reserves, retained earnings, other equity and non-controlling interests).

Key management personnel of the Group review the capital structure on a quarterly basis. As part of this review, the key management personnel consider the cost of capital and the risks associated with each class of capital. Based on recommendations of the key management personnel, in order to balance the overall capital structure, the Group may adjust the amount of dividends paid to shareholders, the number of new shares issued or repurchased, and the amount of new debt issued or existing debt redeemed.

The Group is not subject to any externally imposed capital requirements.

25. FINANCIAL INSTRUMENTS

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

The Group’s management considers the carrying amounts recognized in the consolidated financial statements for financial assets and financial liabilities not carried at fair value to approximate their fair values or their fair values cannot be reliably measured.

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

• 1) Fair value hierarchy

December 31, 2021 Financial assets at FVTPL Beneficiary certificates Financial assets at FVTOCI Equity instruments Domestic unlisted shares December 31, 2020 Financial assets at FVTPL Beneficiary certificates Financial assets at FVTOCI Equity instruments Domestic unlisted shares	Level 1 $ - $ - Level 1 $ - $ -	Level 2 $ 86,880 $ - Level 2 $ 80,537 $ -	Level 3 $ - $ 69,076 Level 3 $ - $ 73,104	Total $ 86,880 $ 69,076 Total $ 80,537 $ 73,104

There were no transfers between Levels 1 and 2 in the current and prior periods.

• 2) Reconciliation of Level 3 fair value measurements of financial instruments

Investments in equity instruments at FVTOCI

Balance at January 1 Purchases Recognized in other comprehensive income (included in unrealized gain on financial assets at FVTOCI) Balance at December 31	For the Year Ended	For the Year Ended	December 31
		2021 $ 73,104 46,430 (50,458) $ 69,076	2020 $ 34,247 36,801 2,056 $ 73,104

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

Financial Instrument Valuation Technique and Inputs Structured deposits Future cash flows are estimated based on the rate of return derived from the invested principal and the linked target.

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

The fair values of unlisted equity securities - ROC were determined using the market approach. In this approach, the estimates or assumptions used to determine fair values are established by reference to relevant information of other listed companies or peers in similar nature of business.

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c. Categories of financial instruments

Financial assets Financial assets at FVTPL Mandatorily classified as at FVTPL Financial assets at amortized cost (1) Financial assets at FVTOCI Equity instruments Financial liabilities Financial liabilities at amortized cost (2)	December 31
	2021 2020 $ 86,880 $ 80,537 2,104,679 2,064,944 69,076 73,104 2,370,848 2,446,746

• 1) The balances include financial assets at amortized cost, which comprise cash and cash equivalents, time deposits with original maturity of more than 3 months, restricted deposits, notes receivable, accounts receivable and other receivables.

• 2) The balances included financial liabilities measured at amortized cost, which comprise short-term borrowings, notes payable, accounts payable, other payables and long-term borrowings.

• d. Financial risk management objectives and policies

The Group’s major financial instruments include equity and beneficiary certificates investments, accounts receivable, accounts payable, lease liabilities and short-term and long-term borrowings. The Group’s corporate treasury function provides services to the business, monitors and manages the financial risks relating to the operations of the Group through internal risk reports which analyze exposures by degree and magnitude of risks. These risks include market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

1) Market risk

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

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

a) Foreign currency risk

The Group had foreign currency sales and purchases, which were exposed to foreign currency risk. To protect against reductions in value and the volatility of future cash flows caused by changes in foreign exchange rates, the Group managed the risk by balancing positions of assets and liabilities denominated in foreign currencies.

The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities (including those eliminated on consolidation) and of the derivatives exposed to foreign currency risk at the end of the reporting period are set out in Note 30.

Sensitivity analysis

The Group was mainly exposed to the USD, RMB and EUR.

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The following details the effects of a 1% increase or decrease in New Taiwan dollars (the functional currency) against the relevant foreign currencies. The rate of 1% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis included only outstanding foreign currency denominated monetary items and adjusts their translation at the end of the reporting period for a 1% change in foreign currency rates. For a 1% strengthening/weakening of NTD against the relevant currency, the net profit before tax would be a decrease/an increase of $14,762 thousand for the year ended December 31, 2021, and the net loss before tax would be an increase/a decrease of $14,020 thousand for the year ended December 31, 2020.

b) Interest rate risk

The Group was exposed to interest rate risk because entities in the Group borrowed funds at both fixed and floating interest rates. The risk is managed by the Group by maintaining an appropriate mix of fixed and floating rate borrowings.

The carrying amounts of the Group’s financial assets and financial liabilities with exposure to interest rates at the end of the reporting period were as follows:

Fair value interest rate risk Financial assets Financial liabilities Cash flow interest rate risk Financial assets Financial liabilities	December 31
	2021 2020 $ 20,193 $ 2,469 361,005 297,055 997,268 925,217 1,495,825 1,782,996

Sensitivity analysis

The sensitivity analyses below were determined based on the Group’s exposure to interest rates for both derivatives and non-derivative instruments at the end of the reporting period. For floating rate liabilities, the analysis was prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year. A 10 basis points increase or decrease was used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates.

The sensitivity analyses were determined based on the Group’s exposure to interest rates at the end of the reporting period. A 10 basis points increase or decrease was used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates.

If interest rates had been 10 basis points higher/lower and all other variables were held constant, the Group’s pre-tax profit for the year ended December 31, 2021 would have decreased/ increased by $499 thousand and the Group’s pre-tax loss for the year ended December 31, 2020 would have increased/decreased by $858 thousand, which was mainly attributable to the Group’s exposure to cash flow on its variable-rate bank borrowings.

c) Other price risk

The Group was exposed to equity price risk through its investments in equity securities and beneficiary certificates.

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Sensitivity analysis

The sensitivity analysis below was determined based on the exposure to equity price risks at the end of the reporting period.

If equity prices had been 10% higher/lower, pre-tax profit for year ended December 31, 2021 would have increased/decreased by $8,688 thousand, as a result of the changes in fair value of financial assets at FVTPL. Pre-tax loss for year ended December 31, 2020 would have decreased/increased by $8,054 thousand, as a result of the changes in fair value of financial assets at FVTPL. The other comprehensive income for the years ended December 31, 2021 and 2020 would have increased/decreased by $6,908 thousand and $7,310 thousand, respectively, as a result of the changes in fair value of financial assets at FVTOCI.

2) Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. As at the end of the reporting period, the Group’s maximum exposure to credit risk which will cause a financial loss to the Group due to failure of counterparties to discharge an obligation and due to financial guarantees provided by the Group could arise from:

• a) The carrying amount of the respective recognized financial assets as stated in the balance sheets; and

• b) The amount of contingent liabilities in relation to financial guarantee issued by the Group.

The Group adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. The Group only transacts with entities that are rated the equivalent of excellent grade. This information is supplied by a rating agency where available and, if not available, the Group uses other publicly available financial information to rate its major customers. The Group’s exposure and the credit ratings of its counterparties are continuously monitored and the aggregate value of transactions concluded is spread amongst approved counterparties.

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

3) Liquidity risk

Ultimate responsibility for liquidity risk management rests with the board of directors, which has built an appropriate liquidity risk management framework for the Group’s short, medium and long-term funding and liquidity management requirements. The Group manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, and continuously monitoring forecast and actual cash flows as well as matching the maturity profiles of financial assets and liabilities. As of December 31, 2021 and 2020, the Group had available unutilized bank loan facilities set out in (b) below.

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

The following tables detail the Group’s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The tables had been drawn up based on the undiscounted cash flows of financial liabilities from the earliest date on which the Group can be required to pay. Specifically, bank loans with a repayment on demand clause were included in the earliest time band regardless of the probability of the banks choosing to exercise their rights. The maturity dates for other non-derivative financial liabilities were based on the agreed repayment dates.

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December 31, 2021

Non-interest bearing Lease liabilities Variable interest rate liabilities Fixed interest rate liabilities December 31, 2020 Non-interest bearing Lease liabilities Variable interest rate liabilities Fixed interest rate liabilities	Less than 3 Months $ 619,427 7,320 926,565 20,634 $ 1,573,946 Less than 3 Months $ 480,178 6,814 1,110,486 104,087 $ 1,701,565	3 Months to 1 Year $ - 20,139 171,063 191,697 $ 382,899 3 Months to 1 Year $ - 18,401 307,330 104,462 $ 430,193	1-5 Years $ - 55,951 402,975 51,324 $ 510,250 1-5 Years $ - 58,400 271,197 66,510 $ 396,107	5+ Years $ - 26,762 26,055 4,220 $ 57,037 5+ Years $ - 35,881 26,727 17,253 $ 79,861

The above amount of variable interest rate instruments for both non-derivative financial assets and liabilities was subject to change if changes in variable interest rates differ from those estimates of interest rates determined at the end of the reporting period.

b) Financing facilities

Unsecured bank overdraft facility, reviewed annually and payable on demand: Amount used Amount unused Secured bank overdraft facility: Amount used Amount unused		December 31	December 31
		2021 $ 509,257 552,081 $ 1,061,338 $ 1,219,041 648,801 $ 1,867,842	2020 $ 897,514 751,044 $ 1,648,558 $ 1,029,950 866,926 $ 1,896,876

e. Transfers of financial assets

The Group did not sign a contract for the sale of notes receivable with banks in 2021. For the year ended December 31, 2020, the Group’s discounted notes receivable with aggregate carrying amount of $91,983 thousand were pledged to banks for cash proceeds of $90,959 thousand. According to the contract, if these trade receivables are not recoverable at maturity, banks have the right to request that the Group pays the unsettled balance. As the Group has not transferred the significant risks and rewards relating to these trade receivables, it continues to recognize the full carrying amounts of these trade receivables and treats these notes and accounts receivable that have been transferred to banks as collateral for borrowings (see Note 27).

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As of December 31, 2020, the carrying amount of these notes receivable (classified as other receivables) that have been transferred but not derecognized was $39,988 thousand, and the carrying amount of the related liabilities was $39,988 thousand.

26. TRANSACTIONS WITH RELATED PARTIES

The Company’s board of directors was fully re-elected on May 27, 2020. Parpro Corporation (Parpro) lost its control over the Company by not being able to acquire more than half the seats in the board of directors, and its relationship with the Company had changed from parent company to associate. Parpro held 20.86% of the Company’s outstanding shares on December 31, 2021. Balances and transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and are not disclosed in this note. The price and the transaction terms with related parties were not significantly different from those with third parties. Details of material transactions between the Group and other related parties are disclosed below:

• a. Related parties and their relationships with the Company:

Related Party Parpro Corporation (Parpro) Verite SLICE BLISS CO., LTD. MATEC Schweiz AG	Relationship with the Company
	Investor with significant influence over the Group (parent entity before May 27, 2020) Associate Associate Associate

• b. Sales

Related Party Category/Name Associate Investor with significant influence over the Group	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 4,890 9 $ 4,899	2020 $ 1,508 29 $ 1,537

For major transactions between the Group and related parties, the transaction price is considerably the same as those of non-related parties.

• c. Purchases of goods

Related Party Category/Name Associate	**For the Year Ended December 31 **	**For the Year Ended December 31 **	**For the Year Ended December 31 **
		2021 $ 56	2020 $ 113

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• d. Lease arrangements

Related Party Category/Name Lease expense Investor with significant influence over the Group Parent entity	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 1,911 - $ 1,911	2020 $ 140 100 $ 240

The Company leases buildings for plants and office spaces which are under short-term lease regulation, and the lease is under common market price. The conditions and rental payments are similar to ordinary leases.

• e. Compensation of key management personnel

Short-term employee benefits Post-employment benefits	**For the Year Ended **	**For the Year Ended **	**December 31 **
		2021 $ 83,370 2,633 $ 86,003	2020 $ 98,458 1,944 $ 100,402

The remuneration of directors and key executives was determined by the remuneration committee having regard to the performance of individuals and market trends.

27. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

The following assets at book value were provided as collateral for bank borrowings and to obtain loan limit:

Bank deposits (classified as financial assets at amortized cost) Accounts receivable Notes receivable (classified as other receivables) Building Freehold land Other non-current assets		December 31	December 31
		2021 $ 186,355 19,077 - 314,286 88,037 6,482 $ 614,237	2020 $ 133,116 27,652 39,988 363,019 125,457 6,482 $ 695,714

28. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

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

As of December 31, 2021, unused letters of credit for purchases of raw materials amounted to $70,538 thousand.

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29. OTHER ITEMS

The Group has evaluated the impact of the COVID-19 pandemic. As of the date the consolidated financial statements were authorized for issue, there was no significant impact on the Group’s operation, financing condition and asset impairment. However, the impact of the pandemic is still uncertain. As such, the Group will continue to monitor the development of the pandemic and evaluate its impact.

30. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

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

December 31, 2021

		Foreign		Carrying
	Currencies		Exchange Rate	Amount
Financial assets
Monetary items
USD	$	25,752	27.680 (USD:NTD)	$ 712,815
EUR		2,771	31.320 (EUR:NTD)	86,788
RMB		175,675	4.344 (RMB:NTD)	763,132
Financial liabilities
Monetary items
USD		1,931	27.680 (USD:NTD)	53,450
EUR		901	31.320 (EUR:NTD)	28,219
RMB		1,126	4.344 (RMB:NTD)	4,891
December 31, 2020
		Foreign		Carrying
	Currencies		Exchange Rate	Amount
Financial assets
Monetary items
USD	$	27,552	28.480 (USD:NTD)	$ 784,681
EUR		2,697	35.020 (EUR:NTD)	94,449
RMB		149,766	4.377 (RMB:NTD)	655,526
Financial liabilities
Monetary items
USD		3,990	28.480 (USD:NTD)	113,635
EUR		538	35.020 (EUR:NTD)	18,841
RMB		51	4.377 (RMB:NTD)	223

For the years ended December 31, 2021 and 2020, realized and unrealized net foreign exchange losses amounted to $35,944 thousand and $36,634 thousand, respectively. It is impractical to disclose net foreign exchange gain (loss) by each significant foreign currency due to the variety of the foreign currency transactions.

31. SEPARATELY DISCLOSED ITEMS

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• a. Information about significant transactions

• 1) Financing provided to others. (Table 1)

• 2) Endorsements/guarantees provided. (Table 2)

• 3) Marketable securities held (excluding investment in subsidiaries, associates and joint ventures). (Table 3)

• 4) Marketable securities acquired and disposed at costs or prices at least NT$300 million or 20% of the paid-in capital. (None)

• 5) Acquisition of individual real estate at costs of at least NT$300 million or 20% of the paid-in capital. (None)

• 6) Disposal of individual real estate at prices of at least NT$300 million or 20% of the paid-in capital. (None)

• 7) Total purchases from or sales to related parties amounting to at least NT$100 million or 20% of the paid-in capital. (Table 4)

• 8) Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital. (Table 5)

• 9) Trading in derivative instruments. (None)

• 10) Intercompany relationships and significant intercompany transactions formation on investees. (Table 6)

• b. Information on investees. (Table 7)

• c. Information on investments in mainland China

• 1) Information on any investee company in mainland China, showing the name, principal business activities, paid-in capital, method of investment, inward and outward remittance of funds, ownership percentage, net income of investees, investment income or loss, carrying amount of the investment at the end of the period, repatriations of investment income, and limit on the amount of investment in the mainland China area. (Table 8)

• 2) Any of the following significant transactions with investee companies in mainland China, either directly or indirectly through a third party, and their prices, payment terms, and unrealized gains or losses. (Table 6)

• d. Information of major shareholders:

List all shareholders with ownership of 5% or greater showing the name of the shares and percentage of ownership of each shareholder (Table 9)

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32. SEGMENT INFORMATION

Information reported to the chief operating decision maker for the purpose of resource allocation and assessment of segment performance focuses on the types of goods or services delivered or provided. The Group’s reportable segments were as follows:

• a. Segments revenues and results

The following was an analysis of the Group’s revenue and results from continuing operations by reportable segment.

Segment revenue Machinery segment Wood panels segment Segment income (loss) Machinery segment Wood panels segment Non-operating income and expenses Profit (loss) before tax	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 2,905,574 682,032 $ 3,587,606 $ 25,071 45,825 70,896 206,939 $ 277,835	2020 $ 2,626,359 584,587 $ 3,210,946 $ (156,327) 24,586 (131,741) 6,206 $ (125,535)

• b. Segment total assets and liabilities

The Group’s segment total assets and liabilities and other segment information were not provided to the chief operating decision maker; therefore, disclosure was not necessary.

c. Geographic information

Taiwan China USA Germany Brazil Australia Thailand Others	Revenue from External Customers	Revenue from External Customers	Revenue from External Customers
	For the Year Ended December 31
		2021 $ 957,215 596,764 475,484 370,939 282,491 233,987 35,585 635,141 $ 3,587,606	2020 $ 932,886 535,361 467,355 404,488 178,512 99,843 15,177 577,324 $ 3,210,946

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Taiwan Brazil Germany USA China Others		Non-current Assets	Non-current Assets
		December 31
		2021 $ 863,607 169,775 130,499 68,982 40,800 18,654 $ 1,292,317	2020 $ 995,217 175,104 150,910 72,611 46,856 - $ 1,440,698

Non-current assets exclude financial instruments, investments accounted for using the equity method and deferred tax assets.

• d. Revenue from major products and services

For the years ended December 31, 2021 and 2020, the Group’s revenue from a single customer did not exceed 10% of the consolidated revenue.

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TABLE 1

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

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

No.	Lender	Borrower	Financial Statement Account	Related Parties	Highest Balance for the Period (Note 1)	Ending Balance (Note 1)	Actual Borrowing Amount	Interest Rate	Nature of Financing	Business Transaction Amounts	Reasons for Short-term Financing	Allowance for Impairment Loss	Collateral	Collateral	Financing Limit for Each Borrower (Notes 1 and 3)	Aggregate Financing Limits (Notes 1 and 3)	Note
													Item	Value
0	The Company	MATEC Monforts GmbH	Accounts receivable - related parties Other accounts receivable	Yes No	$ 34,370 54,992	$ 31,320 50,112	$ 31,320 50,112	2.5% 2.5%-5%	Short-term financing Short-term financing	$ - -	Operation requirements Operation requirements	$ - 4,973	- -	$ - -	$ 435,516 435,516	$ 871,032 871,032	2 5
1	CNT	The Company	Accounts receivable - related parties	Yes	77,378	73,196	-	2.5%	Short-term financing	-	Operation requirements	-	-	-	233,885	233,885	3
2	Sogotec	Sogotec Shanghai	Other receivable - related parties	Yes	156,204	153,227	153,227	1.48%	Business transaction	356,922	-	-	-	-	227,894	227,894	4

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

Note 2: The loan limit should not exceed 40% of total equity of the Company. The loan limit to one party should not exceed 20% of the total equity or business transaction amount.

Note 3: The loan limit should not exceed 100% of total equity of the Company.

Note 4: The loan limit should not exceed 40% of total equity of the Company. The loan limit to one party should not exceed the total loan limit or business transaction amount.

Note 5: In May 2020, the Group lost control over Monforts GmbH after designating its trustee in bankruptcy.

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TABLE 2

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

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

No.	Endorser/Guarantor	Endorsee/Guarantee	Endorsee/Guarantee	Limits on Endorsement/ Guarantee Given on Behalf of Each Party	Maximum Amount Endorsed/ Guaranteed During the Period	Outstanding Endorsement/ Guarantee at the End of the Period	Actual Borrowing Amount	Amount Endorsed/ Guaranteed by Collaterals	Ratio of Accumulated Endorsement/ Guarantee to Net Equity in Latest Financial Statements (%)	Aggregate Endorsement/ Guarantee Limit	Endorsement/ Guarantee Given by Parent on Behalf of Subsidiaries	Endorsement/ Guarantee Given by Subsidiaries on Behalf of Parent	Endorsement/ Guarantee Given on Behalf of Companies in Mainland China	Note
		Name	Relationship (Note 3)
0	The Company	Anderson Merchandise MATEC	b b	$ 653,274 653,274	$ 220,000 171,850	$ 220,000 43,848	$ 91,315 43,848	$ - -	10.10 2.01	$ 1,088,791 1,088,791	Yes Yes	- -	- -	1 1
1	Sogotec	Sogotec Shanghai	b	170,921	87,680	86,880	19,078	-	15.25	284,868	-	-	Yes	2

Note 1: The balance to one party should not exceed 30% of the total equity of the Company. The balance should not exceed 50% of total equity of the Company.

Note 2: The balance to one party should not exceed 30% of the total equity of the Sogotec Limited. The balance should not exceed 50% of total equity of the Sogotec Limited.

Note 3: The relationship is as follows:

• b. The Company controls over 50% of subsidiary’s ordinary shares directly.

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TABLE 3

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

MARKETABLE SECURITIES HELD DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Holding Company Name	Type and Name of Marketable Securities (Note 1)	Relationship with the Holding Company	Financial Statement Account		December 31, 2021	December 31, 2021		Note
				Shares (In Thousands of Shares)	Carrying Amount	Percentage of Ownership (%)	Fair Value
CNT Anderson Logistics	China Guangfa Bank “Wuhua Tianbao Version W, Section 282, year 2021” Structured Deposit Harbinger Technology Corporation	- -	Financial assets at fair value through profit or loss - current Financial assets at fair value through other comprehensive income - non-current	- 4,559	$ 86,880 69,076	- 7.85	$ 86,880 69,076	- -

Note 1: Marketable securities in the table refer to shares, bonds, beneficiary certificates and other related derivative securities within the scope of IFRS 9 “Financial Instruments”.

Note 2: Information on investments in subsidiaries and associates, see Table 7 and Table 8 for details.

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TABLE 4

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

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

(In Thousands of New Taiwan Dollars)

Buyer	Related Party	Relationship		Transaction	Transaction	Details	Abnormal Transaction	Abnormal Transaction	Notes/Accounts Receivable (Payable)	Notes/Accounts Receivable (Payable)	Note
			Purchase/ Sale	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
The Company Sogotec	Anderson America Sogotec Shanghai	Subsidiaries Subsidiaries	Sales Sales	$ (299,937) (398,884)	(32) (65)	Note 1 Net 360 days from the end of the month after acceptance	None Note 2	Note 1 Note 2	$ 181,265 475,505	31 91	- Note 3

Note 1: Collection depends on capital status.

Note 2: Sales price between Sogotech and related parties are decided mutually, the credit period for related parties is net 360 days from the end of the month after acceptance. The credit period for non-related parties is by installment or 30-150 days from the end of the month after acceptance.

Note 3: Receivable generated from related party transactions is $628,732 thousand, recorded as accounts receivable of $475,505 thousand and other accounts receivable of $153,227 thousand.

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TABLE 5

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

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

(In Thousands of New Taiwan Dollars)

Company Name	Related Party	Relationship	Ending Balance	Turnover Rate		Overdue	Amounts Received in Subsequent Period	Allowance for Impairment Loss
					Amount	Actions Taken
The Company Sogotec	Anderson America Giben America Sogotec Shanghai Sogotec Shanghai	Subsidiaries Subsidiaries Subsidiaries Subsidiaries	Accounts receivable $ 181,265 Accounts receivable 149,986 Accounts receivable 475,505 Other accounts receivable 153,227	1.54 0.02 0.82 N/A	$ - - 77,836 153,227	- - - -	$ - - - 49,486	$ - - - -

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TABLE 6

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

BUSINESS RELATIONSHIP AND SIGNIFICANT INTERCOMPANY TRANSACTION FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Number	Company Name	Counterparty	Relationship (Note)		Transaction Details	Transaction Details
				Financial Account	Amount	Transaction Terms	% to Total Revenue or Assets
0	The Company	Anderson America Anderson America Giben America Giben Brasil Matec CNT CNT CNT Anderson Logistics Sogotec	1 1 1 1 1 1 1 1 1 1	Sales revenue Accounts receivable - related parties Accounts receivable - related parties Accounts receivable - related parties Other receivable - related parties Sales revenue Accounts receivable - related parties Other receivable - related parties Current prepayments for investments Sales revenue	$ 299,937 181,265 149,986 24,495 31,809 14,762 57,701 50,474 46,430 12,498	The same as common term of trade The same as common term of trade, and collection depends on capital status The same as common term of trade, and collection depends on capital status The same as common term of trade, and collection depends on capital status The same as common term of trade, and collection depends on capital status The same as common term of trade The same as common term of trade, and collection depends on capital status The same as common term of trade, and collection depends on capital status The same as common term of trade The same as common term of trade	8 4 3 - 1 - 1 1 1 -
1	Sogotec	Sogotec Shanghai Sogotec Shanghai Sogotec Shanghai	3 3 3	Sales revenue Accounts receivable - related parties Other receivable - related parties	398,884 475,505 153,227	The same as common term of trade The same as common term of trade, and collection depends on capital status The same as common term of trade, and collection depends on capital status	11 9 3
2	Anderson Europe GmbH	The Company	2	Accounts receivable - related parties	10,454	The same as common term of trade, and collection depends on capital status	-
3	Giben SAMOA	Anderson America Giben Brasil	3 3	Sales revenue Accounts receivable - related parties	14,737 32,356	The same as common term of trade The same as common term of trade, and collection depends on capital status	- 1
4	Anderson Industrial	CNT	3	Other receivable - related parties	20,931	The same as common term of trade, and collection depends on capital status	-

• Note 1: 1. Parent to subsidiary.

• Subsidiary to parent.

• Between subsidiaries.

Note 2: The disclosed amount is at least NT$10,000 thousand.

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TABLE 7

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

INFORMATION ON INVESTEES (EXCLUDING INFORMATION ON INVESTMENT IN MAINLAND CHINA) FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars)

Investor Company	Investee Company	Location	Main Businesses and Products	Original Investment Amount	Original Investment Amount	As of	December 31, 2021	December 31, 2021	Net Income (Loss) of the Investee	Share of Profits (Loss)	Note
				December 31, 2021	December 31, 2020	Shares (In Thousands of Shares)	%	Carrying Amount
The Company Anderson Merchandise Anderson Logistics Giben SAMOA Giben BVI Anderson Europe GmbH MATEC	Anderson Industrial Anderson Europe GmbH Anderson America Anderson Logistics Giben BVI Giben SAMOA Anderson Merchandise Sogotec Sogotec Sogotec Verite Slice Bliss Giben America Giben Brasil Giben Brasil Monforts GmbH MATEC ASC Matec Schweiz AG	Hong Kong Germany USA Taiwan British Virgin Islands Samoa Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan USA Brazil Brazil Germany Germany Germany Schweiz	Import, exporting and general investing activities Manufacture, sale of machinery and service Sale of machinery and service Import and export Investment Investment Sale of wood panels and service Manufacture and sale of machinery Manufacture and sale of machinery Manufacture and sales of machinery Import and export Import and export Sale of machinery and service Manufacture and sale of machinery Manufacture and sale of machinery Manufacture and sale of machinery Manufacture and sale of machinery Sale of machinery and service Sale of machinery and service	$ 1,014 441,603 215,024 220,000 422,078 146,813 50,000 238,746 3,000 178,682 18,000 5,500 145,329 1,183 421,626 197,426 155,496 808 1,292	$ 1,014 441,603 215,024 220,000 422,078 146,813 50,000 238,746 3,000 178,682 18,000 - 145,329 1,183 421,626 197,426 155,496 808 -	300 Note 1 1 22,000 10 10 5,000 11,796 50 4,461 1,800 550 Note 1 Note 1 Note 1 Note 1, 2 Note 1 Note 1 0.51	100.00 100.00 100.00 100.00 100.00 100.00 100.00 58.11 0.25 21.97 33.33 33.33 100.00 0.28 99.72 - 100.00 100.00 51.00	$ 31,645 260,591 48,207 202,795 241,240 74,067 197,891 293,477 2,947 124,844 947 4,900 (43,071) 675 240,935 - 146,633 731 563	$ - 47 15,419 (9,354) 41,773 (9,157) 33,979 3,855 3,855 3,855 - - (28,581) 46,589 46,589 - (8,626) (19) -	$ - 341 15,419 (9,354) 41,773 (9,157) 33,979 4,821 Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable	- - - - - - - - - - - - - - - - - - -

Note 1: Limited company structure.

Note 2: In May 2020, the Group lost control over Monforts GmbH after designating its trustee in bankruptcy.

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TABLE 8

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

INFORMATION ON INVESTMENTS IN MAINLAND CHINA FOR THE YEAR ENDED DECEMBER 31, 2021

(In Thousands of New Taiwan Dollars)

Investee Company	Main Businesses and Products	Main Businesses and Products	Paid-in Capital	Paid-in Capital	Method of Investment (Note 1)	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2021	Investment Flows	Investment Flows	Accumulated Outward Remittance for Investment from Taiwan as of December 31, 2021	Net Income (Loss) of the Investee	% Ownership of Direct or Indirect Investment	Investment Gain (Loss)	Carrying Amount as of December 31, 2021	Accumulated Repatriation of Investment Income as of December 31, 2021	Note
							Outflow	Inflow
CNT Jentec Sogotec Shanghai	Manufacture and sale of woodworking machinery Manufacture and sale of machinery Sale of machinery and service		$ 264,167 70,640 26,487		a a b	$ 264,167 70,640 26,487	$ - - -	$ - - -	$ 264,167 70,640 26,487	$ (15,709) (1,267) (10,662)	100 100 100	$ (15,709) (1,284) (10,662)	$ 230,595 37,679 (78,330)	$ 104,731 - -	2 and 4 2 -
Accumulated Outward Remittance for Investment in Mainland China as of December 31, 2021		Investment Amounts Authorized by Investment Commission, MOEA		Upper Limit on the Amount of Investment Stipulated by Investment Commission, MOEA
$ 361,294		$ 361,294		$ -(Note3)

• Note 1: The methods of investment are as follows:

• a. Direct investment in mainland China.

• b. Sogotec has obtained 100% contribution for $26,487 thousand (US$800 thousand).

Note 2: The amount was calculated using the equity method valuation and based on the audited financial statements.

Note 3: In accordance with “Examination Principles for Licensing Investment or Technical Cooperation in Mainland China” (revised by the MOEA on August 29, 2008), the Company has acquired certificate of operating scope, therefore the upper limit does not have to be calculated.

• Note 4: As of December 31, 2021, CNT has remitted investment income of RMB23,109 thousand, equivalent to NT$104,731 thousand.

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TABLE 9

ANDERSON INDUSTRIAL CORPORATION INFORMATION OF MAJOR SHAREHOLDERS DECEMBER 31, 2021

Name of Major Shareholder	Shares	Shares
	Number of Shares	Percentage of Ownership (%)
Parpro Corporation Yunyong Investment Co., Ltd.	39,904,488 20,000,000	20.01 10.03

Note: The information of major shareholders presented in this table is provided by the Taiwan Depository & Clearing Corporation based on the number of ordinary shares and preferred shares held by shareholders with ownership of 5% or greater, that have been issued without physical registration (including treasury shares) by the Company as of the last business day for the current quarter. The share capital in the consolidated financial statements may differ from the actual number of shares that have been issued without physical registration because of different preparation basis.

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