Stock Code:3596

ARCADYAN TECHNOLOGY CORPORATION

Parent Company Only Financial Statements

With Independent Auditors’ Report For the Years Ended December 31, 2025 and 2024

Address: 8F., No. 8, Sec. 2, Guangfu Rd., East Dist., Hsinchu City, Taiwan Telephone: (03)572-7000

The independent auditors’ report and the accompanying parent company only financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ report and parent company only financial statements, the Chinese version shall prevail.

Contents
1. Cover Page
2. Table of Contents
3. Independent Auditors’ Report
4. Balance Sheets
5. Statements of Comprehensive Income
6. Statements of Changes in Equity
7. Statements of Cash Flows
8. Notes to the Financial Statements
(1)
Company history
(2)
Approval date and procedures of the financial statements
(3)
New standards, amendments and interpretations adopted
(4)
Summary of material policies
(5)
Significant accounting assumptions and judgments, and major sources
of estimation uncertainty
(6)
Explanation of significant accounts
(7)
Related-party transactions
(8)
Pledged assets
(9)
Significant contingent liabilities and unrecognized commitments
(10) Losses due to major disasters
(11) Subsequent events
(12) Other
(13) Other disclosures
(a) Information on significant transactions
(b) Information on investees
(c) Information on investment in mainland China
(14) Segment information
9. List of major account titles Page

1
2
3
4
5
6
7
8
8
8～10
10～26
27
27～61
61～65
65
66
66
66
66～67
67～69
69～70
70～71
71
72～78

Contents 1. Cover Page 2. Table of Contents 3. Independent Auditors’ Report 4. Balance Sheets 5. Statements of Comprehensive Income 6. Statements of Changes in Equity 7. Statements of Cash Flows 8. Notes to the Financial Statements (1) Company history (2) Approval date and procedures of the financial statements (3) New standards, amendments and interpretations adopted (4) Summary of material policies (5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty (6) Explanation of significant accounts (7) Related-party transactions (8) Pledged assets (9) Significant contingent liabilities and unrecognized commitments (10) Losses due to major disasters (11) Subsequent events (12) Other (13) Other disclosures (a) Information on significant transactions (b) Information on investees (c) Information on investment in mainland China (14) Segment information 9. List of major account titles	Page
	1 2 3 4 5 6 7 8 8 8`～`10 10`～`26 27 27`～`61 61`～`65 65 66 66 66 66`～`67 67`～`69 69`～`70 70`～`71 71 72`～`78

==> picture [76 x 31] intentionally omitted <==

==> picture [168 x 19] intentionally omitted <==

KPMG 台北市110615信義路5段7號68樓(台北101大樓) 電話 Tel + 886 2 8101 6666 68F., TAIPEI 101 TOWER, No. 7, Sec. 5, 傳真 Fax + 886 2 8101 6667 Xinyi Road, Taipei City 110615, Taiwan (R.O.C.) 網址 Web kpmg.com/tw

Independent Auditors’ Report

To the Board of Directors of Arcadyan Technology Corporation: Opinion

We have audited the financial statements of Arcadyan Technology Corporation(“ the Company” ), which comprise the balance sheets as of December 31, 2025 and 2024, the statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the financial statements, including a summary of material accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and its financial performance and its cash flows for the years then ended December 31, 2025 and 2024 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Financial Statement Audit and Attestation Engagements of Certified Public Accountants and Standards on Auditing of the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company 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 of our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the year ended December 31, 2025. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined that the matters described below are the key audit matters to be communicated in our report.

1. Inventory valuation

Please refer to Note (4)(g) for the accounting policy of inventory valuation, Note (5) for the estimation and assumption uncertainty of the valuation of inventory, Note (6)(g) for the explanation of significant accountsInventories to the financial statements.

KPMG, a Taiwan partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee.

3-1

Description of key audit matters:

Inventory is measured at the lower of cost and net realizable value. Given the rapid technological advancements in the networking industry, the accelerated pace of product upgrades, and intensified market competition, inventories are subject to significant risks of obsolescence and price decline. Therefore, the valuation of inventories represents a key audit matter in our audit of the financial statements.

How the matter was addressed in our audit:

The primary audit procedures performed in relation to the above key audit matter included assessing whether the inventory valuation policies of the Company were consistent with those of the prior period and in compliance with the applicable accounting principles; reviewing the inventory aging reports analyzing changes in inventory aging across periods; performing audit verification on the classification of aging intervals and the judgment involved in identifying specific items. Furthermore, we recalculated the provision for inventory obsolescence and valuation losses in accordance with the Company’s policies.

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

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

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

Those charged with governance (including members of the Audit Committee) are responsible for overseeing the Company’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Financial Statements

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

3-2

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

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of the investment in other entities accounted for using the equity method to express an opinion on this financial statements. We are responsible for the direction, supervision and performance of the 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.

3-3

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

The engagement partners on the audit resulting in this independent auditors’ report are Keng-Chia Huang and Yiu-Kwan Au.

KPMG

Taipei, Taiwan (Republic of China) February 25, 2026

Notes to Readers

The accompanying parent company only financial statements are intended only to present the financial position, financial performance and cash flows in accordance with the 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 parent company only financial statements are those generally accepted and applied in the Republic of China.

(English Translation of Financial Statements Originally Issued in Chinese) ARCADYAN TECHNOLOGY CORPORATION

Balance Sheets

December 31, 2025 and 2024

(Expressed in thousand dollars of TWD)

Assets Current assets: 1100 Cash and cash equivalents (note (6)(a)) 1110 Current financial assets at fair value through profit or loss (note (6)(b)) 1139 Current financial assets for hedging (note (6)(d)) 1137 Current financial assets at amortized cost (note (6)(e)) 1170 Accounts receivable, net (notes (6)(f) and (6)(t)) 1180 Accounts receivable from related parties, net (notes (6)(t) and (7)) 1200 Other receivables 1210 Other receivables from related parties (note (7)) 1310 Inventories, net (note (6)(g)) 1470 Other current assets Non-current assets: 1550 Investments accounted for using equity method (note (6)(h)) 1511 Non-current financial assets at fair value through profit or loss (note (6)(b)) 1517 Non-current financial assets at fair value through other comprehensive income (note (6)(c)) 1600 Property, plant and equipment (note (6)(i)) 1755 Right-of-use assets (note (6)(j)) 1780 Intangible assets (note (6)(k)) 1840 Deferred tax assets (note (6)(q)) 1900 Other non-current assets (note (8)) Total assets	December 31, 2025 Amount % $ 3,478,021 9 4,254 - 13,181 - 8,800,000 22 5,759,539 15 450,045 1 151,975 - 531,142 1 13,253,157 34 91,963 - 32,533,277 82 3,349,236 9 38,614 - 10,609 - 2,764,613 7 10,876 - 51,059 - 871,677 2 59,894 - 7,156,578 18 $ 39,689,855 100	December 31, 2024 Amount % 6,867,564 20 - - - - 5,103,852 15 3,720,150 11 266,924 1 1,370,309 4 1,495,724 4 8,377,765 25 68,848 - 27,271,136 80 3,340,711 10 37,965 - 19,437 - 2,582,557 8 21,934 - 52,147 - 848,853 2 112,042 - 7,015,646 20 34,286,782 100 Liabilities and Equity Current liabilities: 2100 Short-term borrowings (note (6)(l)) 2120 Current financial liabilities at fair value through profit or loss (note (6)(b)) 2126 Current financial liabilities for hedging (note (6)(d)) 2130 Current contract liabilities (notes (6)(t) and (7)) 2170 Accounts payable 2180 Accounts payable to related parties (note (7)) 2200 Other payables (including related parties) (note (7)) 2230 Current tax liabilities 2250 Current provisions (note (6)(o)) 2280 Current lease liabilities (note (6)(n)) 2300 Other current liabilities (note (6)(m)) Non-current liabilities: 2570 Deferred tax liabilities (note (6)(q)) 2580 Non-current lease liabilities (note (6)(n)) 2640 Non-current net defined benefit liability (note (6)(p)) 2670 Other non-current liabilities (note (6)(h)) Total liabilities Equity(note (6)(r)): 3100 Ordinary shares 3200 Capital surplus 3300 Retained earnings 3410 Exchange differences on translation of foreign financial statements 3420 Unrealized gains (losses) on financial assets at fair value through other comprehensive income 3450 Gains (losses) on hedging instruments Total equity Total liabilities and equity	December 31, 2025	December 31, 2025		December 31, 2024
			Amount	%		Amount % 341,300 1 - - - - 814,454 2 7,508,892 22 884,749 3 6,330,193 18 354,807 1 688,721 2 11,573 - 1,273,592 4 18,208,281 53 - - 10,632 - 41,325 - 91,575 - 143,532 - 18,351,813 53 2,203,543 6 3,651,759 11 9,910,030 29 199,700 1 (30,063) - - - 15,934,969 47 34,286,782 100

See accompanying notes to financial statements.

(English Translation of Financial Statements Originally Issued in Chinese) ARCADYAN TECHNOLOGY CORPORATION

Statements of Comprehensive Income

For the years ended December 31, 2025 and 2024

(Expressed in thousand dollars of TWD)

4100 Operating revenue, net(notes (6)(d), (6)(t) and (7)) 5000 Operating costs(notes (6)(g), (6)(i), (6)(j), (6)(k), (6)(p), (6)(u), (7) and (12)) Gross profit from operations 5910 Unrealized profit from sales Operating expenses(notes (6)(i), (6)(j), (6)(k), (6)(p), (6)(u), (7) and (12)): 6100 Selling expenses 6200 Administrative expenses 6300 Research and development expenses Total operating expenses Net operating income Non-operating income and expenses: 7100 Interest income (note (7)) 7230 Foreign exchange gains, net 7375 Share of profit of subsidiaries, associates and joint ventures accounted for using equity method (note (6)(h)) 7010 Other gains and losses 7510 Interest expense (note (6)(n)) 7635 Gains (losses) on financial assets (liabilities) at fair value through profit or loss (notes (6)(b) and (6)(d)) Total non-operating income and expenses Income before tax 7950 Less: Income tax expenses (note (6)(q)) Net income 8300 Other comprehensive income: 8310 Components of other comprehensive income (loss) that will not be reclassified to profit or loss 8311 Gains (losses) on remeasurements of defined benefit plans (note (6)(p)) 8316 Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income (note (6)(c)) 8349 Less: Income tax related to components of other comprehensive income that will not be reclassified to profit or loss (note (6)(q)) Total components of other comprehensive income (loss) that will not be reclassified to profit or loss 8360 Components of other comprehensive income (loss) that may be reclassified to profit or loss 8361 Exchange differences on translation of foreign financial statements 8368 Gains (losses) on hedging instrument (note (6)(d)) 8380 Share of other comprehensive income of subsidiaries, associates and joint ventures accounted for using equity method, components of other comprehensive income that may be reclassified to profit or loss (note (6)(h)) 8399 Less: Income tax related to components of other comprehensive income that may be reclassified to profit or loss (note (6)(q)) Total components of other comprehensive income (loss) that may be reclassified to profit or loss 8300 Other comprehensive income Total comprehensive income Earnings per share (TWD)(note (6)(s)) 9750 Basic earnings per share (TWD) 9850 Diluted earnings per share (TWD)	2025 Amount % $ 48,221,538 100 41,328,377 86 6,893,161 14 (40,734) - 6,933,895 14 536,279 1 677,097 1 2,921,980 6 4,135,356 8 2,798,539 6 223,864 - (52,220) - 450,381 1 5,827 - (7,113) - (1,198) - 619,541 1 3,418,080 7 641,000 1 2,777,080 6 (6,865) - (8,828) - (1,373) - (14,320) - (106,728) - 10,311 - 61 - 2,062 - (98,418) - (112,738) - $ 2,664,342 6 $ 12.60 $ 12.43	2024
		Amount % 41,033,218 100 34,477,842 84 6,555,376 16 48,751 - 6,506,625 16 570,886 1 616,682 2 2,646,763 6 3,834,331 9 2,672,294 7 187,034 - 41,659 - 170,882 - 35,023 - (12,628) - (28,535) - 393,435 - 3,065,729 7 579,300 1 2,486,429 6 30,092 - (16,005) - 6,018 - 8,069 - 168,337 - 14,246 - 1,216 - 2,850 - 180,949 - 189,018 - 2,675,447 6 11.28
		11.14

See accompanying notes to financial statements.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese) ARCADYAN TECHNOLOGY CORPORATION

Statements of Changes in Equity

For the years ended December 31, 2025 and 2024

(Expressed in thousand dollars of TWD)

Ordinary shares	Capital surplus		Retained earnings	Retained earnings	Retained earnings				Total other equity interest	Total other equity interest	Total other equity interest	Total other equity interest	Total equity
							Exchange differences on translation of foreign financial statements		Unrealized gains (losses) on financial assets measured at fair value through other comprehensive income	Gains (losses) on hedging instruments
		Legal reserve	Special reserve	Unappropriated retained earnings		Total retained earnings
$ 2,203,543 - - - - - - - - 2,203,543 - - - - - - - $ 2,203,543	3,872,335	1,534,292	2,213		7,185,148 2,486,429 24,074 2,510,503 (241,942) 2,213 (1,322,126) - - 8,133,796 2,777,080 (5,492) 2,771,588 (251,051) (1,432,303) - - 9,222,030	8,721,653		30,147	(14,058) - (16,005) (16,005) - - - - - (30,063) - (8,828) (8,828) - - - - (38,891)		(11,396) - 11,396 11,396 - - - - - - - 8,249 8,249 - - - - 8,249	4,693 - 164,944 164,944 - - - - - 169,637 - (107,246) (107,246) - - - - 62,391	14,802,224 2,486,429 189,018 2,675,447 - - (1,322,126) (220,354) (222) 15,934,969 2,777,080 (112,738) 2,664,342 - (1,432,303) (220,354) (1,950) 16,944,704
	- -	- -	- -			2,486,429 24,074		- 169,553
	-	-	-			2,510,503		169,553
		241,942 - - - -						- - - - -
		1,776,234 - -
		-
		251,051 - - -
		2,027,285

See accompanying notes to financial statements.

(English Translation of Financial Statements Originally Issued in Chinese) ARCADYAN TECHNOLOGY CORPORATION

Statements of Cash Flows

For the years ended December 31, 2025 and 2024

(Expressed in thousand dollars of TWD)

Cash flows from operating activities: Income before tax Adjustments: Adjustments to reconcile profit (loss): Depreciation expense Amortization expense Reversal of expected credit impairment Interest expense Interest income Net losses (gains) on financial assets or liabilities at fair value through profit or loss Share of loss of subsidiaries, associates and joint ventures accounted for using equity method Unrealized (losses) gains on sales and others Total adjustments to reconcile profit (loss) Changes in operating assets and liabilities: Decreasein financial assets or liabilities at fair value through profit or loss (Increase) decreasein accounts receivable (Increase) decreasein accounts receivable – related parties Decrease (increase)in other receivables (including related parties) (Increase) decreasein inventories Increasein other current assets Increasein current contract liabilities Increase (decrease)in accounts payable (including related parties) Increasein other payables and other current liabilities Decreasein other operating liabilities Total changes in operating assets and liabilities Total adjustments Cash inflow generated from operations Interest received Dividends received Interest paid Income taxes paid Net cash flows from operating activities Cash flows from investing activities: Proceeds from capital reduction of financial assets at fair value through profit or loss Acquisition of financial assets at amortized cost Proceeds from disposal of financial assets at amortized cost Acquisition of investments accounted for using equity method Proceeds from capital reduction of investments accounted for using equity method Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Acquisition of intangible assets Decrease (increase) in other non-current assets Net cash flows used in investing activities Cash flows from financing activities: Decrease in short-term borrowings Cash dividends paid Repayment of principal of lease liabilities Other financing activities Net cash flows used in financing activities Net (decrease) increase in cash and cash equivalents for the period Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	2025 $ 3,418,080 219,809 43,715 (5,165) 7,113 (223,864) 1,198 (450,381) (40,405) (447,980) 6,731 (2,039,239) (183,121) 2,166,756 (4,875,392) (23,115) 563,429 2,646,599 1,335,828 (3,887) (405,411) (853,391) 2,564,689 238,355 - (7,178) (606,537) 2,189,329 2,563 (18,600,000) 14,903,852 (2,008) 325,665 (397,424) 1,457 (42,627) 52,148 (3,756,374) (156,600) (1,652,651) (11,925) (1,322) (1,822,498) (3,389,543) 6,867,564 $ 3,478,021	2024 3,065,729 215,277 53,681 (14,315) 12,628 (187,034) (300) (170,882) 48,619 (42,326) 32,805 1,433,838 3,528,263 (490,251) 2,879,838 (61,973) 463,227 (2,778,717) 1,180,840 (2,234) 6,185,636 6,143,310 9,209,039 169,579 10,447 (15,155) (1,201,178) 8,172,732 - (5,103,852) - (61,268) - (717,093) 1,003 (40,207) (17,346) (5,938,763) (610,555) (1,542,480) (14,504) 1,830 (2,165,709) 68,260 6,799,304 6,867,564

See accompanying notes to financial statements.

(English Translation of Financial Statements Originally Issued in Chinese) ARCADYAN TECHNOLOGY CORPORATION

Notes to the Financial Statements

For the years ended December 31, 2025 and 2024

(Expressed in thousand dollars of TWD, Unless Otherwise Specified)

(1) Company history

Arcadyan Technology Corporation (the “ Company”) was incorporated in May 9, 2003. The registered address is 8F., No. 8, Sec. 2, Guangfu Road, East District, Hsinchu City.

The Company is primarily engaged in the research, development, manufacture and sale of integrated access devices, wireless networking products, digital home multimedia appliances, mobile broadband products and wireless audio-visual products, please refer to note 6(t).

(2) Approval date and procedures of the financial statements:

These financial statements were authorized for issuance by the Board of Directors on February 25, 2026.

(3) New standards, amendments and interpretations adopted:

(a) The impact of the International Financial Reporting Standards (“IFRS”) endorsed by the Financial Supervisory Commission (“FSC”), R.O.C. which have already been adopted.

The Company has initially adopted the following new amendments, which do not have a significant impact on its financial statements, from January 1, 2025:

●Amendments to IAS21 “Lack of Exchangeability”
(b) The impact of IFRS Accounting Standards endorsed by the FSC but not yet effective

The Company assesses that the adoption of the following new amendments, effective for annual period beginning on January 1, 2026, would not have a significant impact on its financial statements:

●IFRS 17 “Insurance Contracts” and amendments to IFRS 17 “Insurance Contracts”
●Amendments to IFRS 9 and IFRS 7 “ Amendments to the Classification and Measurement of Financial Instruments”
●Annual Improvements to IFRS Accounting Standards—Volume 11
●Amendments to IFRS 9 and IFRS 7 “Contracts Referencing Nature-dependent Electricity”

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(c) The impact of IFRS Accounting Standards issued by IASB but not yet endorsed by the FSC

The following new and amended standards, which may be relevant to the Company, have been issued by the International Accounting Standards Board (IASB), but have yet to be endorsed by the FSC:

Standards or Interpretations Content of amendment IFRS 18 “Presentation and The new standard introduces three Disclosure in Financial categories of income and expenses, two Statements” income statement subtotals and one single note on management performance measures. The three amendments, combined with enhanced guidance on how to disaggregate information, set the stage for better and more consistent information for users, and will affect all the entities.

●A more structured income statement: under current standards, companies use different formats to present their results, making it difficult for investors to compare financial performance across companies. The new standard promotes a more structured income statement, introducing a newly defined ‘operating profit’ subtotal and a requirement for all income and expenses to be allocated between three new distinct categories based on a company’ s main business activities.

Effective date per IASB

January 1, 2027 Note: On September 25, 2025, the FSC issued a press release announcing that Taiwan will adopt IFRS 18 starting from fiscal year 2028. Companies that need to adopt the new standard earlier may elect early adoption once IFRS 18 is endorsed by the FSC.

●Management performance measures (MPMs): the new standard introduces a definition for management performance measures, and requires companies to explain in a single note to the financial statements why the measure provides useful information, how it is calculated and reconcile it to an amount determined under IFRS Accounting Standards.
●Greater disaggregation of information: the new standard includes enhanced guidance on how companies group information in the financial statements. This includes guidance on whether information is included in the primary financial statements or is further disaggregated in the notes.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

The Company is evaluating the impact on its financial position and financial performance upon the initial adoption of the abovementioned standards or interpretations. The results thereof will be disclosed when the Company completes its evaluation.

The Company does not expect the following other new and amended standards, which have yet to be endorsed by the FSC, to have a significant impact on its financial statements:

●Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets Between an Investor and Its Associate or Joint Venture”
●IFRS 19 “Subsidiaries without Public Accountability: Disclosures” and amendments to IFRS 19 “Subsidiaries without Public Accountability: Disclosures”
●Amendments to IAS 21 “Translation to a Hyperinflationary Presentation Currency”

(4) Summary of material policies:

The material accounting policies presented in the financial statements are summarized as follows. Except as otherwise indicated, the following accounting policies were applied consistently throughout the presented periods in the financial statements.

(a) Statement of compliance

These financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

(b) Basis of preparation
(i) Basis of measurement

Except for the following significant accounts in the balance sheets, the financial statements have been prepared on the historical cost basis:

1) Financial assets and liabilities at fair value through profit or loss are measured at fair value;
2) Financial assets at fair value through other comprehensive income are measured at fair value;
3) Hedging financial assets are measured at fair value; and
4) The net benefit liabilities (assets) are measured at fair value of plan assets less the present value of the defined benefit obligation, limited as explained in note (4)(p).
(ii) Functional and presentation currencies

The functional currency of the company is determined based on the primary economic environment in which the Company operates. The financial statements are presented in New Taiwan Dollars (TWD), which is the Company’s functional currency. Unless otherwise noted, all financial information presented in TWD has been rounded to the nearest thousand.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(c) Foreign currencies

(i) Foreign currency transactions

Transactions in foreign currencies are translated into the respective functional currency of the Company at the exchange rates at the dates of the transactions. At the end of each subsequent reporting period, monetary items denominated in foreign currencies are translated into the functional currencies using the exchange rate at that date. Non-monetary items denominated in foreign currencies that are measured at fair value are translated into the functional currencies using the exchange rate at the date that the fair value was determined. Non-monetary items denominated in foreign currencies that are measured based on historical cost are translated using the exchange rate at the date of the transaction.

Exchange differences are generally recognized in profit or loss, except for those differences relating to the following, which are recognized in other comprehensive income:

1) an investment in equity securities designated as at fair value through other comprehensive income;
2) a financial liability designated as a hedge of the net investment in a foreign operation to the extent that the hedge is effective; or
3) qualifying cash flow hedges to the extent that the hedges are effective.

(ii) Foreign operations

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated into TWD at the exchange rates at the reporting date. The income and expenses of foreign operations are translated into TWD at the average exchange rate. Exchange differences are recognized in other comprehensive income.

When a foreign operation is disposed of such that control, significant influence, or joint control is lost, the cumulative amount in the translation reserve related to that foreign operation is reclassified to profit or loss as part of the gain or loss on disposal. When the Company disposes of only part of its interest in a subsidiary that includes a foreign operation while retaining control, the relevant proportion of the cumulative amount is reattributed to noncontrolling interests. When the Company disposes of only part of its investment in an associate or joint venture that includes a foreign operation while retaining significant influence or joint control, the relevant proportion of the cumulative amount is reclassified to profit or loss.

When the settlement of a monetary receivable from or payable to a foreign operation is neither planned nor likely in the foreseeable future, exchange difference arising from such items are considered to form part of a net investment in the foreign operation are recognized in other comprehensive income.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(d) Classification of current and non-current assets and liabilities

The Company classifies the asset as current under one of the following criteria, and all other assets are classified as non-current.

(i) It is expected to be realized, or intended to be sold or consumed, in the normal operating cycle;
(ii) It is held primarily for the purpose of trading;
(iii) It is expected to be realized within twelve months after the reporting period; or
(iv) The asset is cash or a cash equivalent (as defined in IAS 7) unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

The Company classifies the liability as current under one of the following criteria, and all other liabilities are classified as non-current.

(i) It is expected to be settled in the normal operating cycle;
(ii) It is held primarily for the purpose of trading;
(iii) It is due to be settled within twelve months after the reporting period; or
(iv) It does not have the right at the end of the reporting period to defer settlement of the liability for at least twelve months after the reporting period.
(e) Cash and cash equivalents

Cash comprises cash on hand, check deposits and demand deposits. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value. Time deposits and repurchase agreements which meet the above definition and are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes should be recognized as cash equivalents.

(f) Financial instruments

Trade receivables and debt securities issued are initially recognized when they are originated. All other financial assets and financial liabilities are initially recognized when the Company becomes a party to the contractual provisions of the instrument. A financial asset (unless it is a account receivable without a significant financing component) or financial liability not measured at fair value through profit or loss is initially measured at fair value plus transaction costs that are directly attributable to its acquisition or issue. A trade receivable without a significant financing component is initially measured at the transaction price.

(i) Financial assets

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

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

On initial recognition, Financial assets are classified as the following categories: measured at amortized cost, fair value through other comprehensive income (FVOCI) – debt investment, FVOCI – equity investment, or fair value through profit or loss (FVTPL).

When the Company changes its business model for managing financial assets, all affected financial assets are reclassified on the first day of the first reporting period following the change in the business model.

1) Financial assets measured at amortized cost

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

‧ it is held within a business model whose objective is to hold assets to collect contractual cash flows; and
‧ its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

These assets are subsequently measured at amortized cost, which is the amount at which the financial asset is measured at initial recognition, plus/minus, the cumulative amortization using the effective interest method, adjusted for any loss allowance. Interest income, foreign exchange gains and losses, as well as impairment, are recognized in profit or loss. Any gain or loss on derecognition is recognized in profit or loss.

2) Fair value through other comprehensive income (FVOCI )

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

‧ it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and
‧ its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Some accounts receivables are held within a business model whose objective is achieved by both collecting contractual cash flows and selling by the Company, therefore, those receivables are measured at FVOCI. However, they are included in the "Accounts receivables".

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

Equity investments at FVOCI are subsequently measured at fair value. Dividends are recognized as income in profit or loss unless the dividend clearly represents a recovery of part of the cost of the investment. Other net gains and losses are recognized in other comprehensive income and are never reclassified to profit or loss.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

Dividend income derived from equity investment is recognized on the date on which the Company’s right to receive payment is established, which in the case of quoted securities is normally the ex-dividend date.

3) Fair value through profit or loss (FVTPL)

All financial assets not classified as amortized cost or FVOCI described as above such as financial assets held-for-trading and evaluate performance on a fair value basic are measured at FVTPL, including derivative financial assets. On initial recognition, the Company may irrevocably designate a financial asset, which meets the requirements to be measured at amortized cost or at FVOCI, as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.

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

4) Impairment of financial assets

The Company recognizes loss allowances for expected credit losses (ECL) on financial assets measured at amortized cost (including cash and cash equivalents, amortized costs, notes and trade receivables, other receivables, refundable deposit paid and other financial assets).

The Company measures loss allowances at an amount equal to lifetime ECL, except for the following which are measured as 12-month ECL:

‧ debt securities that are determined to have low credit risk at the reporting date; and
‧ other debt securities and bank balances for which credit risk (i.e. the risk of default occurring over the expected life of the financial instrument) has not increased significantly since initial recognition.

Loss allowance for accounts receivable and contract assets are always measured at an amount equal to lifetime ECL.

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

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

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

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

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

The Company considers a debt security to have low credit risk when its credit risk rating is equivalent to the globally understood definition of ‘ investment grade which is considered to be BBB- or higher per Standard & Poor’s, Baa3 or higher per Moody’s or twA or higher per Taiwan Ratings’.

The Company assumes that the credit risk on a financial asset has increased significantly if it is more than 30 days past due.

The Company considers a financial asset to be in default when the financial asset is more than 90 days past due or the debtor is unlikely to pay its credit obligations to the Company in full.

ECLs are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the Company in accordance with the contract and the cash flows that the Company expects to receive). ECLs are discounted at the effective interest rate of the financial asset.

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

‧ significant financial difficulty of the borrower or issuer;

‧ a breach of contract such as a default or being more than 90 days past due;

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

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

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

Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets.

The gross carrying amount of a financial asset is written off either partially or in full to the extent that there is no realistic prospect of recovery. For corporate customers, the Company individually makes an assessment with respect to the timing and amount of write-off based on whether there is a reasonable expectation of recovery. The Company expects no significant recovery from the amount written off. However, financial assets that are written off could still be subject to enforcement activities in order to comply with the Company’s procedures for recovery of amounts due.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

5) Derecognition of financial assets

The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Company neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.

The Company enters into transactions whereby it transfers assets recognized in its statement of balance sheet, but retains either all or substantially all of the risks and rewards of the transferred assets. In these cases, the transferred assets are not derecognized.

(ii) Financial liabilities and equity instruments

1) Classification of debt or equity

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

2) Equity transaction

An equity instrument refer to surplus equities of the assets after the deduction of all the debt for any contracts. Equity instruments issued are recognized as the amount of consideration received, less the direct cost of issuing.

3) Financial liabilities

Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss.

Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in profit or loss.

4) Derecognition of financial liabilities

The Company derecognizes a financial liability when its contractual obligations are discharged or cancelled, or expire. The Company also derecognizes a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value.

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

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

5) Offsetting of financial assets and liabilities

Financial assets and financial liabilities are offset and the net amount presented in the statement of balance sheet when, and only when, the Company currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously.

(iii) Derivative financial instruments and hedge accounting

The Company holds derivative financial instruments to hedge its foreign currency and interest rate exposures. Embedded derivatives are separated from the host contract and accounted for separately if the host contract is not a financial asset and certain criteria are met.

Derivatives are initially measured at fair value. Subsequent to initial recognition, derivatives are measured at fair value, and changes therein are generally recognized in profit or loss.

The Company designates certain hedging instruments (which include derivatives, embedded derivatives and non-derivatives in respect of foreign currency risk) as either fair value hedges, cash flow hedges, or hedges of net investments in foreign operations. Hedges of foreign exchange risk on firm commitments are accounted for as cash flow hedges.

At inception of designated hedging relationships, the Company documents the risk management objectives and strategy for undertaking the hedge. The Company also documents the economic relationship between the hedged item and the hedging instrument, including whether the changes in cash flows of the hedged items and hedging instrument are expected to offset each other.

Cash flow hedges

When a derivative is designated as a cash flow hedging instrument, the effective portion of changes in the fair value of derivatives is recognized in other comprehensive income, and － accumulated in ‘other equity interest gains (losses) on hedging instruments’. The amount recognized is limited to the cumulative change in fair value of the hedged item from inception of the hedge. The gain or loss relating to the ineffective portion is recognized immediately in profit or loss.

When the hedged item is recognized in profit or loss, the amounts previously recognized in other comprehensive income and accumulated in equity are reclassified to profit or loss in the same periods and presented in the same line as the recognized hedged item. However, when the hedged forecast transaction that results in the recognition of a non-financial asset or a nonfinancial liability, the gains and losses previously recognized in other comprehensive income and accumulated in equity are removed from equity and included in the initial measurement cost of the non-financial asset or non-financial liability. Furthermore, if the Company expects that all or a portion of the loss accumulated in other equity will not be recovered in the future, that amount is immediately reclassified to profit or loss.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

If the hedging relationship no longer meets the criteria for hedge accounting or the hedging instrument is sold, expires, terminated or exercised, then hedge accounting is discontinued prospectively. When hedge accounting for cash flow hedges is discontinued, the amount that has been accumulated in other equity remains in equity until the hedged future cash flows occur. When the future cash flows occur, the accumulated amount is accounted for as an adjustment to the carrying amount of the related non-financial asset and non-financial liability. For other cash flow hedges, it is reclassified to profit or loss in the same period or periods as the hedged future cash flows affect profit or loss. If the hedged future cash flows are no longer expected to occur, then the amounts that have been accumulated in other equity are immediately reclassified to profit or loss.

(g) Inventories

Inventories are measured at the lower of cost and net realizable value. The cost of inventories is calculated using the standard cost principle and includes expenditure incurred in acquiring the inventories, production or conversion costs, and other costs incurred in bringing them to their present location and condition. In the case of manufactured inventories and work in progress, cost includes an appropriate share of fixed production overheads based on normal operating capacity. However, if the actual operating capacity is not significantly different from the normal operating capacity, it will be apportioned according to the actual operating capacity, and the variable manufacturing overhead will be apportioned based on the actual operating capacity.

Inventories are measured for their net realizable value at the end of each reporting period. Management evaluates whether an allowance for inventory write-off is required based on factors such as the salability of inventories, expected demand, market price fluctuations, and inventory turnover conditions. If the carrying amount of inventories exceeds their net realizable value, an allowance for inventory obsolescence and write-off is recognized.

Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses.

(h) Investment in associates

Associates are those entities in which the Company has significant influence, but not control or joint control, over their financial and operating policies.

Investments in associates are accounted for using the equity method and are recognized initially at cost. The cost of the investment includes transaction costs. The carrying amount of the investment in associates includes goodwill arising from the acquisition less any accumulated impairment losses.

The financial statements include the Company’s share of the profit or loss and other comprehensive income of those associates, after adjustments to align their accounting policies with those of the Company, from the date on which significant influence commences until the date on which significant influence ceases. The Company recognizes its share of those changes as capital surplus based on its ownership percentage when an associate’s equity changes due to reasons other than profit and loss or comprehensive income, which did not affect the Company's ownership percentage of the associate.

Unrealized gains and losses resulting from transactions between the Company and an associate are recognized only to the extent of unrelated Company’s interests in the associate.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

When the Company’s share of losses of an associate equals or exceeds its interests in an associate, it discontinues recognizing its share of further losses. After the recognized interest is reduced to zero, additional losses are provided for, and a liability is recognized, only to the extent that the Company has incurred legal or constructive obligations or made payments on behalf of the associate.

(i)

Investments in subsidiaries

The subsidiaries in which the Company holds controlling interest are accounted for under equity method in the non-consolidated financial statements. Under equity method, the net income, other comprehensive income and equity in the non-consolidated financial statement are the same as those attributable to the owners of the parent in the consolidated financial statements.

The changes in ownership of the subsidiaries are recognized as equity transaction.

(j) Property, plant and equipment
(i) Recognition and measurement

Items of property, plant and equipment are measured at cost, which includes capitalized borrowing costs, less accumulated depreciation and any accumulated impairment losses.

If significant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

Any gain or loss on disposal of an item of property, plant and equipment is recognized in profit or loss.

(ii) Subsequent expenditure

Subsequent expenditure is capitalized only if it is probable that the future economic benefits associated with the expenditure will flow to the Company.

(iii) Depreciation

Depreciation is calculated on the cost of an asset less its residual value and is recognized in profit or loss on a straight-line basis over the estimated useful lives of each component of an item of property, plant and equipment.

Land is not depreciated.

The estimated useful lives of property, plant and equipment for current and comparative periods are as follows:

1) Buildings: 50 years
2) Machinery and equipment: 3~6 years
3) Research and development equipment: 3~6 years
4) Mold equipment: 2~3 years
5) Other equipment: 1~10 years

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

The major components of building and equipment are factory buildings and fire protection facilities. Each component is depreciated separately based on its useful life.

Depreciation methods, useful lives, and residual values are reviewed at each annual reporting date and adjusted if appropriate.

(k) Lease

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

(i) As a lessee

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

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

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

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

1) fixed payments, including in substance fixed payments;
2) variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;
3) amounts expected to be payable under a residual value guarantee; and
4) payments for purchase or termination options that are reasonably certain to be exercised or fines to be paid.

The lease liability is measured at amortized cost using the effective interest method. It is remeasured when:

1) there is a change in future lease payments arising from the change in an index or rate; or
2) there is a change in the Company’s estimate of the amount expected to be payable under a residual value guarantee; or

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

3) there is a change in the lease term resulting from a change of its assessment on whether it will exercise an option to purchase the underlying asset, or
4) there is a change of its assessment on whether the Company will exercise an extension or termination option; or
5) there is any lease modifications.

When the lease liability is remeasured, other than lease modifications, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or in profit and loss if the carrying amount of the right-of-use asset has been reduced to zero.

When the lease liability is remeasured to reflect the partial or full termination of the lease for lease modifications that decrease the scope of the lease, the Company accounts for the remeasurement of the lease liability by decreasing the carrying amount of the right-of-use asset to reflect the partial or full termination of the lease, and recognize in profit or loss any gain or loss relating to the partial or full termination of the lease.

The Company presents right-of-use assets and lease liabilities that do not meet the definition of investment property as a separate line item respectively in the balance sheets.

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

(ii) As a leasor

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

If an arrangement contains lease and non-lease components, the Company applies IFRS15 to allocate the consideration in the contract.

(l) Intangible assets
(i) Recognition and measurement

Goodwill arising on the acquisition of subsidiaries is measured at cost, less accumulated impairment losses.

Expenditure on research activities is recognized in profit or loss as incurred.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

Development expenditure is capitalized only if the expenditure can be measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable and the Company intends to, and has sufficient resources to, complete development and to use or sell the asset. Otherwise, it is recognized in profit or loss as incurred. Subsequent to initial recognition, development expenditure is measured at cost, less accumulated amortization and any accumulated impairment losses.

Other intangible assets that are acquired by the Company and have finite useful lives are measured at cost less accumulated amortization and any accumulated impairment losses.

(ii) Subsequent expenditure

Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure, including expenditure on internally generated goodwill and brands, is recognized in profit or loss as incurred.

(iii) Amortization

Amortization is calculated over the cost of the asset, less its residual value, and is recognized in profit or loss on a straight-line basis over the estimated useful lives of intangible assets, other than goodwill, from the date that they are available for use.

The estimated useful lives for current and comparative periods are as follows:

1) Technology licensing: amortized over the contract period by using the straight-line method.
2) Computer software: 1~10 years

Amortization methods, useful lives and residual values are reviewed at each annual reporting date and adjusted if appropriate.

(m) Impairment of non-financial assets

At each reporting date, the Company reviews the carrying amounts of its non-financial assets (other than inventories, deferred tax assets) to determine whether there is any indication of impairment. If any such indication exists, then the asset’ s recoverable amount is estimated. Goodwill is tested annually for impairment.

For the purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows that are largely independent from the cash inflows from other assets or cash-generating unit (CGUs). Goodwill arising from a business combination is allocated to each CGUs or groups of CGUs that are expected to benefit from the synergies of the combination.

The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. The Company will adjust the carrying amount of an asset or CGU to recoverable amount if the carrying amount of an asset or CGU exceeds its recoverable amount, and recognize impairment loss. Impairment losses are recognized in profit or loss. They are allocated first to reduce the carrying amount of any goodwill allocated to the CGU, and then to reduce the carrying amounts of the other assets in the CGU on a pro rata basis.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

An impairment loss in respect of goodwill is not reversed. For other non-financial assets, an impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount (net of depreciation or amortization) that would have been determined, had no impairment loss been recognized for the asset in prior years.

(n) Provisions

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

A provision for warranties is recognized when the underlying products or services are sold. The provision is based on the historical experience of warranty expenses as percentage of sales.

(o) Revenue from contracts with customers

Revenue is measured based on the consideration to which the Company expects to be entitled in exchange for transferring goods or services to a customer. The Company recognizes revenue when it satisfies a performance obligation by transferring control of a good or a service to a customer. The accounting policies for the Company’s main types of revenue are explained below.

(i) Sale of goods

The Company manufactures and sells broadband gateway products, wireless network products, digital home appliance and mobility products. The Company recognizes revenue when control of the products has transferred, being when the products are delivered to the customer, the customer has full discretion over the channel and price to sell the products, and there is no unfulfilled obligation that could affect the customer’ s acceptance of the products. Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the products in accordance with the sales contract, the acceptance provisions have lapsed, or the Company has objective evidence that all criteria for acceptance have been satisfied.

The Company assesses sales allowances based on historical experience, management's judgment, and other known causes. Such allowances are recognized as a deduction of operating revenue in the same period in which the related products are sold, and the Company expects that the aforementioned provisions will be realized in future sales periods. As of the reporting date, the amounts expected to be paid to customers due to discounts are recognized as refund liabilities. The average credit term for sales is consistent with industry practice; therefore, no financing component is included.

A receivable is recognized when the goods are delivered as this is the point in time that the Company has a right to an amount of consideration that is unconditional.

(ii) Rendering of services

Some of the Company's product manufacturing and sales contracts include pre-production activities such as research, development, design, and testing of the new products. The related service revenue is recognized during the financial reporting period in which the services are rendered and consideration is received.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(iii) Financing components

The Company does not expect to have any contracts where the period between the transfer of the promised goods or services to the customer and payment by the customer exceeds one year. As a consequence, the Company does not adjust any of the transaction prices for the time value of money.

(p) Employee benefits

(i) Defined contribution plans

Obligations for contributions to defined contribution plans are expensed as the related service is provided.

(ii) Defined benefit plans

The Company’s net obligation in respect of defined benefit plans is calculated separately for each the plan by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets.

The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method. When the calculation results in a potential asset for the Company, the recognized asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.

Remeasurements of the net defined benefit liability, which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognized immediately in other comprehensive income, and accumulated in retained earnings within equity. The Company determines the net interest expense (income) on the net defined benefit liability (asset) for the period by applying the discount rate used to measure the defined benefit obligation at the beginning of the annual period to the then-net defined benefit liability (asset). Net interest expense and other expenses related to defined benefit plans are recognized in profit or loss.

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

(iii) Short term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognized for the amount expected to be paid if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(q) Income taxes

Income taxes comprise current taxes and deferred taxes. Except for expenses related to business combinations or recognized directly in equity or other comprehensive income, all current and deferred taxes are recognized in profit or loss.

The Company has determined that the global minimum top-up tax – which it is required to pay under Pillar Two legislation – is an income tax in the scope of IAS 12. The Company has applied a temporary mandatory relief for deferred tax accounting treatment to the impacts of the top-up tax and accounts for it as a current tax when it is incurred.

Current taxes comprise the expected tax payables or receivables on the taxable profits (losses) for the year and any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax payables or receivables are the best estimate of the tax amount expected to be paid or received that reflects uncertainty related to income taxes, if any. It is measured using tax rates enacted or substantively enacted at the reporting date.

Deferred taxes arise due to temporary differences between the carrying amounts of assets and liabilities at the reporting date and their respective tax bases. Deferred taxes are recognized except for the following:

(i) temporary differences on the initial recognition of assets and liabilities in a transaction that is not a business combination and at the time of the transaction (1) affects neither accounting nor taxable profits (losses) and (2) does not give rise to equal taxable and deductible temporary differences;
(ii) temporary differences related to investments in subsidiaries, associates and joint arrangements to the extent that the Company is able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future; and
(iii) The initial recognition of goodwill.

Deferred tax assets are recognized for the carry forward of unused tax losses, unused tax credits, and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefits will be realized; such reductions are reversed when the probability of future taxable profits improves.

Deferred taxes are measured at tax rates that are expected to be applied to temporary differences when they reserve, using tax rates enacted or substantively enacted at the reporting date, and reflect uncertainty related to income taxes, if any.

Deferred tax assets and liabilities may be offset against each other if the following criteria are met:

(i) the entity has the legal right to settle tax assets and liabilities on a net basis; and
(ii) the taxing of deferred tax assets and liabilities fulfills one of the scenarios below:
1) levied by the same taxing authorities; or

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

2) levied by different taxing authorities, but where each such authority intends to settle tax assets and liabilities (where such amount are significant) on a net basis every year of the period of expected asset realization or debt liquidation, or where the timing of asset realization and debt liquidation is matched.

(r)

Business combination

The Company accounts for business combinations using the acquisition method. The goodwill arising from an acquisition is measured as the excess of the consideration transferred (which is generally measured at fair value) and the amount of non-controlling interest in the acquiree, both over the identifiable net assets acquired at the acquisition date. If the amount calculated above is a deficit balance, the Company recognized that amount as a gain on a bargain purchase in profit or loss immediately after reassessing whether it has correctly identified all of the assets acquired and all of the liabilities assumed.

All acquisition-related transaction costs are expensed as incurred, except for the issuance of debt or equity instruments.

For each business combination, on a transaction-by-transaction basis, the Company elects to measure any non-controlling interests in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the acquiree’ s identifiable net assets, if the non controlling interests are present ownership interests and entitle their holders to a proportionate share of the Company’s net assets in the event of liquidation. Other components of non-controlling interests are measured at their acquisition-date fair values, or another measurement basis by the IFRSs endorsed by the FSC.

(s)

Earnings per share

The Company discloses the basic and diluted earnings per share attributable to ordinary shareholders of the Company. Basic earnings per share is calculated as the profit attributable to ordinary shareholders of the Company divided by the weighted average number of ordinary shares outstanding. Diluted earnings per share is calculated as the profit attributable to ordinary shareholders of the Company divided by the weighted average number of ordinary shares outstanding after adjustment for the effects of all potentially dilutive ordinary shares, such as employee compensation which could be issued in the form of common stock not yet approved by the Board of Directors.

(t) Operating segments

Please refer to the Company’s consolidated financial statements for the years ended December 31, 2025 and 2024, for further details.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty:

In preparing these financial statements, management has made judgments and estimates about the future, including climate-related risks and opportunities, that affect the application of the accounting policies and the reported amount of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis and are consistent with the Company’s risk management and climate-related commitments where appropriate. Revisions to estimates are recognized prospectively in the period of the change and future periods.

There are no critical judgments in applying the accounting policies that have significant effects on the amounts recognized in the financial statements.

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities within the next financial year is as follows.

Valuation of inventories

As inventories are measured at the lower of cost and net realizable value, the Company evaluates the amount of inventories that may have become obsolete, deteriorated, or lack of market value at the reporting date, and writes down the cost of such inventories to their net realizable value. The valuation of inventories is primarily based on estimated product demand for specific future periods; therefore, estimation differences may arise due to rapid changes in the industry. For further information regarding inventory valuation, please refer to Note 6(g).

(6) Explanation of significant accounts:

(a) Cash and cash equivalents

Cash on hand Checking accounts and demand deposits Time deposits with original maturities of less than three months Repurchase agreements Cash and cash equivalents presented in the statement of cash flows	December 31, 2025 $ 4,504 2,037,027 236,490 1,200,000 $ 3,478,021	December 31, 2024
		3,836 3,763,728 2,100,000 1,000,000
		6,867,564

Please refer to note (6)(v) for the interest rate risk and the fair value sensitivity analysis of the financial assets and liabilities of the Company.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(b) Financial assets and liabilities at fair value through profit or loss

Current financial assets mandatorily measured at fair value through profit or loss: Derivative instruments not used for hedging: Foreign exchange forward contracts Non-current financial assets mandatorily measured at fair value through profit or loss: Non-derivative financial assets: Fund unlisted on domestic or foreign markets Financial liabilities held-for-trading: Derivative instruments not used for hedging: Foreign exchange forward contracts	December 31, 2025 $ 4,254 $ 38,614 $ 15,395	December 31, 2024
		-
		37,965
		-

The Company engages in derivative financial instrument transactions to hedge the foreign exchange risk exposed by its operating activities. As of December 31, 2024, there were no outstanding derivative instruments without the application of hedge accounting. As of December 31, 2025, the details of derivative instruments, without the application of hedge accounting, classified as financial assets mandatorily measured at fair value through profit or loss and held-for-trading financial liabilities were as follows:

Derivative financial assets: Forward contracts: Foreign exchange forward Derivative financial liabilities: Forward contracts: Foreign exchange forward Foreign exchange forward Foreign exchange forward		December 31, 2025
	Contract amount (in thousands)	Currency Maturity date Sell EUR / USD January 29, 2026~ April 14, 2026 Sell EUR / USD January 14, 2026~ May 14, 2026 Sell EUR / TWD January 29, 2026~ March 30, 2026 Sell AUD / USD January 29, 2026~ April 14, 2026
	EUR 16,000 EUR 7,000 EUR 7,000 AUD 17,000

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

Please refer to note (6)(v) for the exposure to credit risk of the financial instruments.

As of December 31, 2025 and 2024, the Company did not provide any aforementioned financial assets as collaterals.

December 31, 2025 Equity investments at fair value through other comprehensive income: Stocks unlisted on domestic markets $ 10,609	December 31, 2024
	19,437

(i) For the years ended December 31, 2025 and 2024, unrealized gains (losses) from the above mentioned equity measured at fair value were $(8,828) and $(16,005), respectively, and were recognized under other comprehensive income.
(ii) There were no disposals of strategic investments and transfers of any cumulative gains or losses within equity relating to these investments for the years ended December 31, 2025 and 2024.
(iii) Please refer to note (6)(v) for information of market risk.
(iv) The Company did not provide any aforementioned financial assets as collaterals.
(d) Financial assets and liabilities used for hedging
(i) Financial assets and liabilities used for hedging were as follows:

Cash flow hedge: Financial assets used for hedging: Forward exchange forward contracts Financial liabilities used for hedging: Foreign exchange forward contracts	December 31, 2025 $ 13,181 $ 2,870	December 31, 2024
		-
		-

－
(ii) Cash flow hedge foreign exchange risk

The strategy of the Company is to enter into foreign exchange forward contracts to hedge its foreign currency exposure risk in relation to the forecast sales.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

As of December 31, 2024, the Company did not engage in derivative instruments for cash flow hedge. As of December 31, 2025, the information relating to the items designated as hedging instruments were as follows:

Derivative financial assets used for hedging Forward exchange contracts: Forward exchange forward Forward exchange forward Derivative financial liabilities used for hedging Forward contracts: Foreign exchange forward		December 31, 2025
	Contract amount (in thousands) Currency Maturity date Average strike price EUR 41,000 Sell EUR / USD January 29, 2026~ December 30, 2026 1.1912 AUD 9,000 Sell AUD / USDJanuary 29, 2026~ June 29, 2026 0.6710 AUD 12,000 Sell AUD / USDJanuary 29, 2026~ June 29, 2026 0.6607	Currency

(iii) Adjustments on reclassification from components of other comprehensive income

For the years ended December 31, 2025 and 2024, the details of adjustments on reclassification from other comprehensive income were as follows:

2025 Cash flow hedge Gains (losses) in current year $ (164,270) Less: Gains (losses) of adjustments on reclassification from components of other comprehensive income which belongs to profit or loss (174,581) Net gains recognized in other comprehensive income $ 10,311	2024
	30,315 16,069
	14,246

(iv) For the years ended December 31, 2025 and 2024, the ineffective portion of cash flow hedge recognized in profit were amounted to $(10,250) and $0, respectively, which were recognized under the “Gains (losses) on financial assets (liabilities) at fair value through profit or loss”.
(v) For the years ended December 31, 2025 and 2024, profit or loss from reclassification adjustments of other equity interest, deriving from the changes in fair-value of hedge instruments, were recognized under operating revenues in statement of comprehensive income.
(e) Financial assets at amortized cost

Time deposits with original maturity of more than three months	December 31, 2025 $ 8,800,000	December 31, 2024 5,103,852

The Group has assessed that these financial assets are held-to-maturity to collect contractual cash flows, which consist solely of payments of principal and interest on principal amount outstanding.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

Therefore, these investments were classified as financial assets at amortized cost.

As of December 31, 2025 and 2024,the ranges of interest rates for aforementioned financial assets were 1.66%~1.72% and 1.635%~1.80%, respectively.

As of December 31, 2025 and 2024, the Company did not provide any financial assets at amortized cost as collaterals.

(f) Accounts receivable

Accounts receivable–measured at amortized cost Accounts receivable–fair value through other comprehensive income Less: allowance for uncollectible accounts	December 31, 2025 $ 5,788,777 - 5,788,777 (29,238) $ 5,759,539	December 31, 2024 3,023,450 726,088 3,749,538 (29,388) 3,720,150

The Company has assessed a portion of its accounts receivable that were held within a business model whose objective is achieved by collecting contractual cash flows and selling financial assets; therefore, such accounts receivable were measured at fair value through other comprehensive income.

The Company applies the simplified approach to provide for its expected credit losses, i.e. the use of lifetime expected loss provision for all receivables. To measure the expected credit losses, accounts receivables have been grouped based on shared credit risk characteristics that represent customers’ ability to pay all amounts due under the contractual terms, as well as incorporated forward looking information, including historical credit losses experience and macroeconomic outlook. The expected credit losses of the receivable determined as follows:

Credit rating		December 31, 2025	December 31, 2025
	Gross carrying amount $ 3,800,525 1,483,920 483,876 - 20,456 $ 5,788,777	Weigh-average ECLs rate 0% 0.1% 1% 5% 100%	Lifetime ECLs Credit impaired - No 2,951 No 5,831 No - - 20,456 Yes 29,238
Level A Level B Level C Level D Level E Total

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

			December 31, 2024	December 31, 2024
		Gross
		carrying	Weigh-average	Lifetime		Credit
	Credit rating	amount	ECLs rate	ECLs		impaired
Level A	$	1,178,977	0%		-	No
Level B		1,997,018	0.1%		2,530	No
Level C		552,207	1%		5,522	No
Level D		-	5%		-	-
Level E		21,336	100%		21,336	Yes
Total	$	3,749,538			29,388
The aging analysis of accounts receivable were as follows:
			December		31, December 31,
				2025		2024
Not overdue			$	5,237,443		3,441,085
Overdue 1~30 days				530,250		285,030
Overdue 31~60 days					116	15
Overdue 61~90 days					512	1,714
Overdue 91~180 days				-		358
Overdue over 181 days				20,456		21,336
			$	5,788,777		3,749,538

The movement of allowance for uncollectible accounts receivable were as follows:

Balance at beginning Impairment loss reversed Balance at ending	2025 $ 29,388 (150) $ 29,238	2024 39,505 (10,117) 29,388

As of December 31, 2025 and 2024, the Company did not provide any aforementioned accounts receivable as collaterals.

The Company entered into accounts receivable factoring agreements with banks. Based on the agreements, the Company is not responsible for guaranteeing the ability of the obligor of the accounts receivable to make payment at the time of debt transfer and debt fulfillment. Thus, this is deemed as a non-recourse accounts receivable factoring. After the transfer of the accounts receivable, the Company can request partial advances as stipulated in the agreements. Interest calculated at an agreed rate during the period from the date of transfer until the accounts receivable are collected is paid to the bank. The remaining amount for which no advance is received when the accounts receivable are paid by the customers.

As of December 31, 2025, the Company did not enter into any receivable factoring agreement with banks. Moreover, no accounts receivable had been factored as of December 31, 2024.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(g) Inventories

(i) A summary of the Company’s inventories was as follows:

Raw materials Semi-finished goods Finished goods	December 31, 2025 $ 3,599,873 3,915 9,649,369 $ 13,253,157	December 31, 2024
		1,814,929 4,354 6,558,482
		8,377,765

(ii) The details of operating costs for the years ended December 31, 2025 and 2024 were as follows:

Cost of sales and expense Provision for inventory valuation and obsolescence loss (reversal of inventory write-down) Loss on inventory scrap	2025 $ 41,340,761 (68,768) 56,384 $ 41,328,377	2024
		34,376,305 92,298 9,239
		34,477,842

(iii) For the years ended December 31, 2025 and 2024, the net realizable value of inventories recovered due to the sale or disposal of obsolete or slow-moving inventories. Accordingly, the amount of inventory write-down and obsolescence losses was reversed.
(iv) As of December 31, 2025 and 2024, the Company did not provide any inventories as collaterals.
(h) Investments accounted for using equity method (including credit balance of investments accounted for using equity method)

A summary of the Company’s financial information for investments accounted for using the equity method at the reporting date were as follows:

December 31, 2025 Subsidiaries $ 3,285,671 Associates 7,156 3,292,827 Add: Recorded in other receivables — deduction of receivable from related parties 56,409 Add: Credit balance of investments accounted for using equity method (recorded in other non-current liabilities) - $ 3,349,236	December 31, 2024
	3,226,180 7,806
	3,233,986 49,725 57,000
	3,340,711

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(i) Subsidiaries

Please refer to the consolidated financial statements for the year ended December 31, 2025.

(ii) Associates

The Company’s financial information for investment accounted for using equity method that are individually insignificant was as follows:

The carrying amount of the Company’s interests in all individually insignificant associates’ equity	December 31, 2025 $ 7,156	December 31, 2024 7,806

The Company’s share of the net income (loss) of associates was as follows:

Attributable to the Company: Net loss from continuing operations Other comprehensive income Total comprehensive loss	2025 $ (580) 5 $ (575)	2024
		(1,246) - (1,246)

(iii) The effects of changes in the equity of the aforementioned subsidiaries on equity attribute to owners of parent were as follows:

Capital surplus-changes in ownership interests in associates	2025 $ (1,950)	2024 (222

(iv) As of December 31, 2025 and 2024, the Company did not provide any investment accounted for using equity method as collaterals.

(i) Property, plant and equipment

The cost and depreciation of the property, plant and equipment of the Company for the years ended December 31, 2025 and 2024 were as follows:

Cost or deemed cost: Balance at January 1, 2025 Additions Disposals and derecognitions Balance at December 31,2025 Balance at January 1, 2024 Additions Reclassifications Disposals and derecognitions Balance at December 31, 2024	Land $ 878,978 - - $ 878,978 $ 878,978 - - - $ 878,978	Buildings and construction 828,128 - - 828,128 828,128 - - - 828,128	Machinery and equipment 98,910 11,184 (3,359) 106,735 73,808 23,613 1,662 (173) 98,910	Research and development equipment 842,215 87,733 (21,460) 908,488 755,084 70,004 25,513 (8,386) 842,215	Molding equipment 189,077 17,906 (5,026) 201,957 140,321 59,067 - (10,311) 189,077	Other equipment 301,847 10,109 (1,739) 310,217 289,975 14,060 - (2,188) 301,847	Construction in progress and prepayment for purchase of equipment 525,060 264,954 - 790,014 56,537 495,698 (27,175) - 525,060	Total
								3,664,215 391,886 (31,584)
								4,024,517
								3,022,831 662,442 - (21,058)
								3,664,215

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

Depreciation and impairment loss: Balance at January 1, 2025 Depreciation for the period Disposals and derecognitions Balance at December 31, 2025 Balance at January 1, 2024 Depreciation for the period Disposals and derecognitions Balance at December 31, 2024 Carrying amounts: Balance at December 31, 2025 Balance at January 1, 2024 Balance at December 31, 2024	Land $ - - - $ - $ - - - $ - $ 878,978 $ 878,978 $ 878,978	Buildings and construction 164,718 16,382 - 181,100 148,336 16,382 - 164,718 647,028 679,792 663,410	Machinery and equipment 29,251 18,295 (1,901) 45,645 12,858 16,567 (174) 29,251 61,090 60,950 69,659	Research and development equipment 545,326 94,623 (21,132) 618,817 462,573 90,186 (7,433) 545,326 289,671 292,511 296,889	Molding equipment 90,340 53,539 (5,026) 138,853 57,631 43,020 (10,311) 90,340 63,104 82,690 98,737	Other equipment 252,023 25,205 (1,739) 275,489 220,004 34,206 (2,187) 252,023 34,728 69,971 49,824	Construction in progress and prepayment for purchase of equipment - - - - - - - - 790,014 56,537 525,060	Total
								1,081,658 208,044 (29,798)
								1,259,904
								901,402 200,361 (20,105)
								1,081,658
								2,764,613
								2,121,429
								2,582,557

As of December 31, 2025 and 2024, the Company did not provide any Company’s property, plant and equipment as collaterals.

(j) Right-of-use assets

The cost and depreciation of the right-of-use of the Company for the years ended December 31, 2025 and 2024 were as follow:

Cost: Balance at January 1, 2025 Additions Disposals and derecognitions Balance at December 31, 2025 Balance at January 1, 2024 Additions Disposals and derecognitions Balance at December 31, 2024 Depreciation: Balance at January 1, 2025 Depreciation for the period Disposals and derecognitions Balance at December 31, 2025 Balance at January 1, 2024 Depreciation for the period Disposals and derecognitions Balance at December 31, 2024	Buildings and construction $ 29,941 - - $ 29,941 $ 29,941 - - $ 29,941 $ 11,079 9,732 - $ 20,811 $ 1,347 9,732 - $ 11,079	Vehicles and Other 11,816 707 (7,832) 4,691 20,434 3,984 (12,602) 11,816 8,744 2,033 (7,832) 2,945 15,857 5,184 (12,297) 8,744	Total 41,757 707 (7,832) 34,632 50,375 3,984 (12,602) 41,757 19,823 11,765 (7,832) 23,756 17,204 14,916 (12,297) 19,823

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

Carrying amount: Balance at December 31, 2025 Balance at January 1, 2024 Balance at December 31, 2024	Buildings and construction $ 9,130 $ 28,594 $ 18,862	Vehicles and Other 1,746 4,577 3,072	Total 10,876
			33,171
			21,934

(k) Intangible assets

The cost and amortization of intangible assets for the years ended December 31, 2025 and 2024, were as follows:

Cost: Balance at January 1, 2025 Additions Reductions Balance at December 31, 2025 Balance at January 1, 2024 Additions Reductions Balance at December 31, 2024 Amortization: Balance at January 1, 2025 Amortization for the period Reductions Balance at December 31, 2025 Balance at January 1, 2024 Amortization for the period Reductions Balance at December 31, 2024 Carrying amounts: Balance at December 31, 2025 Balance at January 1, 2024 Balance at December 31, 2024	Goodwill $ 6,556 - - $ 6,556 $ 6,556 - - $ 6,556 $ - - - $ - $ - - - $ - $ 6,556 $ 6,556 $ 6,556	Authorization fee 4,828 - (1,952) 2,876 24,828 - (20,000) 4,828 4,438 390 (1,952) 2,876 22,788 1,650 (20,000) 4,438 - 2,040 390	Computer software and others 135,598 42,627 (79,610) 98,615 135,900 40,207 (40,509) 135,598 90,397 43,325 (79,610) 54,112 78,875 52,031 (40,509) 90,397 44,503 57,025 45,201	Total
				146,982 42,627 (81,562)
				108,047
				167,284 40,207 (60,509)
				146,982
				94,835 43,715 (81,562)
				56,988
				101,663 53,681 (60,509)
				94,835
				51,059
				65,621
				52,147

As of December 31, 2025 and 2024, the Company did not provide any intangible assets as collaterals.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(l) Short-term borrowings

The short-term borrowings were summarized as follows:

Unsecured bank borrowings Unused short-term credit lines Range of interest rates	December 31, 2025 $ 184,700 $ 13,259,702 2.34%	December 31, 2024
		341,300
		12,592,310
		3.58%

For the information of the Company’s interest risk, foreign currency risk and liquidity risk, please see note (6)(v).

(m) Other current liabilities

The details of other current liabilities were as follows:

December 31, 2025 December 31, 2024 Temporary receipts`－`Non-Recurring Engineering revenue and collection on behalf of others $ 1,168,157 921,005 Others 161,130 352,587 $ 1,329,287 1,273,592 Lease liabilities The details of lease liabilities were as follows: December 31, 2025 December 31, 2024 Current $ 10,353 11,573 Non-current $ 634 10,632 For the maturity analysis, please refer to note (6)(v). The amounts recognized in profit or loss were as follows: 2025 2024 Interest expense on lease liabilities $ 208 337 Expenses relating to short-term leases or leases of low- value assets $ 5,070 4,476 The amounts recognized in the statements of cash flows for the Company were as follows: 2025 2024 Total cash outflow for leases $ 17,203 19,317	December 31, 2025		December 31, 2024
			921,005 352,587
			1,273,592
			December 31, 2024
			11,573
			10,632
			2024
			337
			4,476
		19,317

(n) Lease liabilities

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(i) Office and vehicles lease

The Company leases office and vehicles with lease terms ranging from 3 to 5 years.

(ii) Other leases

The Company leases laboratory with lease terms of 1 year. The Company has elected not to recognize right-of-use assets and lease liabilities for these short-term leases or low-value asset leases.

(o) Provisions-current

Balance at January 1, 2025 Provisions made during the period Provisions used during the period Balance at December 31, 2025 Balance at January 1, 2024 Provisions made during the period Provisions used during the period Balance at December 31, 2024	Warranties $ 688,721 267,121 (129,565) $ 826,277 $ 698,887 199,461 (209,627) $ 688,721

Provisions for warranty related to sales of products are assessed based on the historical experience of similar products or services and customer feedback.

(p) Employee benefits

(i) Defined benefit plans

Reconciliation of the present value of the defined benefit obligations and the fair value of plan assets for the Company were as follows:

Present value of defined benefit obligations Fair value of plan assets Net defined benefit liabilities	December 31, 2025 $ 212,157 (167,854) $ 44,303	December 31, 2024 195,951 (154,626) 41,325

The Company makes defined benefit plan contributions to the pension fund account at the Bank of Taiwan that provides pensions for employees upon retirement. The plans (cover by the Labor Standards Act) entitle a retired employee to receive retirement benefits based on years of service and average salary for the six months prior to retirement.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

1) Composition of plan assets

The Company allocates pension funds in accordance with the Regulations for Revenues, Expenditures, Safeguard and Utilization of the Labor Retirement Fund, and such funds are managed by the Bureau of Labor Funds, Ministry of Labor (hereinafter referred to as the Bureau of Labor Funds). With regard to the utilization of the funds, minimum earnings in the annual distributions shall be no less than the earnings attainable from two-year time deposits with interest rates offered by local banks.

The Company’ s Bank of Taiwan labor pension reserve account balance amounted to $167,854 as of the reporting date. For information on the utilization of the labor pension fund assets including the asset allocation and yield rate of the fund, please refer to the website of the Bureau of Labor Funds, Ministry of Labor.

2) Movements in present value of the defined benefit obligations

The movements in present value of defined benefit obligations of the Company for the years ended December 31, 2025 and 2024 were as follows:

Defined benefit obligations at January 1 Current service costs and interest Remeasurement of net defined benefit liabilities Benefit paid by the plan Defined benefit obligations at December 31	2025 $ 195,951 3,873 17,355 (5,022) $ 212,157	2024 214,688 3,650 (17,770) (4,617) 195,951

3) Movements in the fair value of the defined benefit plan assets

The movements in the fair value of the defined benefit plan assets of the Company for the years ended December 31, 2025 and 2024 were as follows:

Fair value of plan assets at January 1 Contributions paid by the employer Expected return on plan assets Remeasurement of net defined benefit assets Benefit paid by the plan Fair value of plan assets at December 31 Actual return on plan assets	2025 $ 154,626 3,804 2,790 10,490 (3,856) $ 167,854 $ 13,280	2024 141,037 3,839 2,045 12,322 (4,617) 154,626 14,367

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

4) Expenses recognized in profit or loss

The expenses recognized in profit or loss of the Company for the years ended December 31, 2025 and 2024 were as follows:

Current service cost Net interest on the net defined benefit liabilities Operating costs Selling expenses Administrative expenses Research and development expenses	2025 $ 295 788 $ 1,083 $ 121 141 224 597 $ 1,083	2024
		440 1,165
		1,605
		179 191 257 978
		1,605

5) Remeasurements of net defined benefit plans recognized in other comprehensive income

The Company’s actuarial gains and losses recognized in other comprehensive income for the years ended December 31, 2025 and 2024 were as follows:

Cumulative amount at January 1 Recognized for the period Cumulative amount at December 31 (included in retained earnings)	2025 $ 23,253 6,865 $ 30,118	2024 53,345 (30,092) 23,253

6) Actuarial assumptions
a) The following are the Company’s principal actuarial assumptions of the present value of the defined benefit obligation at the reporting date:
- i) Actuarial valuation for present value of defined benefit obligations as of December 31, 2025 and 2024:

		December 31,		December 31,
		2025		2024
	Discount rate	1.750	%	2.000	%
	Future salary increasing rate	3.000	%	2.500	%
ii)	Actuarial valuation for defined	benefit plans cost	for	the years ended
	December 31, 2025 and 2024:
		2025		2024
	Discount rate	2.000	%	1.625	%
	Future salary increasing rate	2.500	%	3.000	%

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

The Company expects to make a contribution of $3,774 to the defined benefit plans within the one year after the reporting date of 2025.

The weighted-average duration of the defined benefit obligation is 11.03 years.

Sensitivity analysis

If the main actuarial assumptions as of December 31, 2025 and 2024 had changed, the impact on the present value of the defined benefit obligation shall be as follows:

December 31, 2025 Discount rate Future salary increasing rate December 31, 2024 Discount rate Future salary increasing rate	Impact on the defined benefit obligation Increased 0.25% Decreased 0.25% (3,355) 3,464 3,330 (3,249) (3,359) 3,475 3,373 (3,286)

Reasonably possible changes to one of the relevant actuarial assumptions, holding other assumptions constant, would have affected the defined benefit obligation by the amounts shown above. In practice, the relevant actuarial assumptions are correlated to each other. The method used in the sensitivity analysis is consistent with the calculation on the net defined benefit liabilities in the balance sheets.

The method and assumptions used in the preparation of sensitivity analysis are consistent with prior period.

8) The payments of retirement benefits to the employees who met the requirements from the Bank of Taiwan labor pension reserve account made by the Company amounted to $3,856 and $4,617 for the years ended December 31, 2025 and 2024, respectively.

(ii) Defined contribution plans

The Company contribute 6% of each employee’s monthly wages to the labor pension personal account at the Bureau of the Labor Insurance in accordance with the provisions of the Labor Pension Act. Under this defined contribution plan, the Company contributes the labor pension at a specific percentage to the Bureau of the Labor Insurance without additional legal or constructive obligations.

The Company recognized the pension costs under the defined contribution method amounting to $59,382 and $55,188 for the years ended December 31, 2025 and 2024, respectively. Payment was contributed to the Bureau of Labor Insurance.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(q) Income taxes

(i) Income tax expense

1) The amount of income tax expense (benefit) for the years ended December 31, 2025 and 2024 were as follows:

2025 Current tax expense Recognized during the period $ 560,136 Additional tax on undistributed earnings 41,358 601,494 Deferred tax income Recognition and reversal of temporary differences 39,506 Income tax expense $ 641,000	2024 602,562 42,878 645,440 (66,140) 579,300

2) The amount of income tax expense (benefit) recognized in other comprehensive income for the years ended December 31, 2025 and 2024 were as follows:

2025 Items that will not be reclassified to profit or loss: Gains (losses) on remeasurement of defined benefit plans $ (1,373) Items that may be reclassified subsequently to profit or loss: Gains on hedging instrument $ 2,062	2024
	6,018
	2,850

3) Reconciliation of income tax expense (benefit) and income before tax for the years ended December 31, 2025 and 2024 were as follows:

Income before tax Income tax at the Company’s domestic tax rate Tax-exempt loss from investment Changes in unrecognized temporary differences Additional tax on undistributed earnings Tax credit of investment	2025 $ 3,418,080 683,616 5,008 (36,039) 41,358 (52,943) $ 641,000	2024 3,065,729 613,146 8,426 39,196 42,878 (124,346) 579,300

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(ii) Deferred tax assets and liabilities
1) Unrecognized deferred tax liabilities:

As of December 31, 2025 and 2024, since the Company was able to control the timing of the reversal of the temporary differences associated with investments in overseas subsidiaries, and the management considered it is probable that the temporary differences which are not expected to reverse in the foreseeable future. Hence, such temporary differences were not recognized under deferred tax liabilities. Detail were as follows:

The temporary differences associated with investments in subsidiaries Unrecognized deferred tax liabilities	December 31, 2025 $ 1,253,086 $ 250,617	December 31, 2024
		1,015,296
		203,059

2) Unrecognized deferred tax assets:

Details of unrecognized under deferred tax assets were as follows:

Tax effect of deductible temporary differences	December 31, 2025 $ 454,343	December 31, 2024
		442,824

The management considered that the temporary differences would probably not be reversed in the foreseeable future. Therefore, such temporary differences were not recognized under deferred tax assets.

3) Recognized deferred tax assets and liabilities

Changes in the amount of deferred tax assets and liabilities were as follows:

Deferred tax assets: Balance at January 1,2025 Recognized in profit or loss Recognized in other comprehensive income Balance at December 31, 2025 Balance at January 1,2024 Recognized in profit or loss Recognized in other comprehensive income Balance at December 31, 2024	Defined benefit plans $ 4,647 - 1,373 $ 6,020 $ 10,665 - (6,018) $ 4,647	Exchange difference on transaction of foreign financial statements 61,138 - - 61,138 61,138 - - 61,138	Loss on inventory valuation 270,304 (668) - 269,636 256,380 13,924 - 270,304	Unrealized exchange losses, net 32,677 (32,677) - - 7,006 25,671 - 32,677	Unrealized gross profit from sales 31,249 (8,147) - 23,102 21,498 9,751 - 31,249	Others 448,838 62,369 574 511,781 441,948 9,740 (2,850) 448,838	Total 848,853 20,877 1,947
							871,677
							798,635 59,086 (8,868)
							848,853

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

Deferred tax liabilities: Balance at January 1,2025 Recognized in profit or loss Recognized in other comprehensive income Balance at December 31, 2025 Balance at January 1,2024 Recognized in profit or loss Balance at December 31, 2024	Share of profit of associates and joint ventures accounted for using equity method		Unrealized exchange gains - (12,857) - (12,857) - - -	Gains on valuation of financial assets - - - - (7,054) 7,054 -	Others - - (2,636) (2,636) - - -	Total - (60,383) (2,636) (63,019) (7,054) 7,054 -

(iii) The ROC tax authorities have examined the income tax expenses of the Company through 2022.

(r) Capital and other equities

(i) Ordinary shares

As of December 31, 2025 and 2024, the Company’s authorized capital were both $3,000,000 of which 220,354 thousand shares were issued. All issued shares were paid up upon issuance.

(ii) Capital surplus

The balances of capital surplus as of December 31, 2025 and 2024 were as follows:

Additional paid-in capital`－`premium Difference between consideration and carrying amount arising from acquisition or disposal of subsidiaries Changes in equity of subsidiaries, associates and joint ventures accounted for using equity method Expired stock options	December 31, 2025 $ 3,420,556 3,698 4,840 361 $ 3,429,455	December 31, 2024
		3,640,910 3,698 6,790 361
		3,651,759

According to the ROC Company Act, capital surplus can only be used to offset a deficit, and only the realized capital surplus generated from premium on issuance of capital stock and earnings from donation may be used to increase the common stock or be distributed as cash dividends in proportion to the shareholders' original shareholdings. According to the Regulations Governing the Offering and Issuance of Securities by Securities Issuers, the total amount of capital surplus used for capital increase per annum shall not exceed 10% of the paid-in capital.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

The Company’s Board of Directors meeting held on February 26, 2025 and February 22, 2024, approved to distribute the cash dividends of $220,354 (TWD1 per share) from capital surplus. The related information can be accessed through the Market Observation Post System website.

The Company’s Board of Directors meeting held on February 25, 2026, approved to distribute the cash dividends of $220,354 (TWD1 per share) from capital surplus. The related information can be accessed through the Market Observation Post System website after the meeting.

(iii) Retained earnings

According to the Company’ s Articles of Incorporation, if the Company makes earnings in a fiscal year, after all taxes and dues have been paid and accumulated loss for previous years have been made up, shall set aside 10% of earnings as legal reserve (unless the amount of legal reserve reaches total paid-in capital), and set aside the special reserve in accordance with relevant laws and regulations. Depending on operation conditions, the board of directors shall retain an appropriate amount then propose an earnings distribution plan. According to the Company’ s Articles of Incorporation, the Company authorizes the board of directors to distribute dividends, bonus, capital surplus and legal reserve in whole or in part in the form of cash, after a resolution adopted by a majority vote at a meeting of board of directors attended by two-thirds of total number of directors, and shall report such distribution plan in the general shareholders’ meeting.

The Company adheres to a stable dividend policy, and dividends distribution should be determined after considering the business environment, operating performance, financial structure. If there is any year-end retained earnings to be distributed to shareholders, the dividend and bonuses shall not be lower than 30% of the net income and the cash dividends to shareholders shall not be lower than 10% of total dividends.

1) Legal reserve

When the company incurs no loss, it may pursuant to a resolution adopted by a shareholders’ meeting, distribute its legal reserve by issuing new shares or by distributing cash. Only the portion of legal reserve which exceeds 25% of paid-in capital may be distributed.

2) Special reserve

During earnings distribution, the Company shall make a further appropriation of special reserve for the difference between the net debit balance of other shareholders’ equity incurred in the current period and the existing balance of special reserve. Special reserve shall be appropriated from the sum of the current period's net income plus items other than the current period's net income that are included in the current year's unappropriated retained earnings, and the prior years' unappropriated retained earnings, for the aforementioned difference. For the cumulative net debit balance of other shareholders’ equity pertaining to prior periods, special reserve shall be appropriated from the prior years' unappropriated retained earnings and shall not be available for distribution. Amounts of subsequent reversals pertaining to the net reduction of other shareholders’ equity may be made available for earnings distribution.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(iv) Earnings distributed

Earnings distribution for 2024 and 2023 were approved by the Board of Directors meeting held on February 26, 2025, and on February 22, 2024, respectively. The relevant dividend distribution to shareholders were as follows:

Cash dividends distributed to ordinary shareholders	2024 Amount per share (TWD) Total amount $ 6.5 1,432,303	2023	2023
	Amount per share (TWD) $ 6.5	Amount per share (TWD) 6.0	Total amount
			1,322,126

The earnings distribution for 2025 was approved by the Board of Directors meeting held on February 25, 2026 as follows:

Cash dividends distributed to ordinary shareholders from unappropriated earnings	2025	2025
	Amount per share (TWD) $ 8.0	Total amount
		1,762,835

The related information of the earnings distribution for the year ended December 31, 2025, can be accessed through the Market Observation Post System website after the relevant meeting.

(s) Earnings per share

The basic earnings per share and diluted earnings per share of the Company were calculated as follows:

Basic earnings per share: Net income attributable to ordinary shareholders of the Company Weighted-average number of ordinary shares (in thousands) Basic earnings per share (TWD) Diluted earnings per share: Net income attributable to ordinary shareholders of the Company Weighted-average number of ordinary shares (in thousands) Effect of dilutive potential ordinary shares (in thousands): Effect of compensation to employees Weighted-average number of ordinary shares (in thousands) (after adjustment of dilutive potential ordinary shares) Diluted earnings per share (TWD)	2025 $ 2,777,080 220,354 $ 12.60 $ 2,777,080 220,354 3,043 223,397 $ 12.43	2024 2,486,429
		220,354
		11.28
		2,486,429
		220,354 2,748
		223,102
		11.14

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(t) Revenue from contracts with customers

(i) Details of revenue

Primary geographical markets: America Europe Asia and others Major products: Smart home solution Mobility solution Broadband solution Others	2025 $ 24,504,270 17,735,497 5,981,771 $ 48,221,538 $ 17,187,334 15,042,478 14,413,510 1,578,216 $ 48,221,538	2024
		20,993,036 13,095,242 6,944,940
		41,033,218
		17,075,955 13,727,459 8,815,597 1,414,207
		41,033,218

(ii) Contract balances

Accounts receivable (including related parties) Less: allowance for uncollectible accounts Total Contract liabilities - current	December 31, 2025 $ 6,238,822 (29,238) $ 6,209,584 $ 1,377,883	December 31, 2024 4,016,462 (29,388) 3,987,074 814,454	January 1, 2024 8,978,563 (39,505) 8,939,058 351,227

For details on accounts receivable and allowance for uncollectible accounts, please refer to note (6)(f).

The amounts of revenue recognized for the years ended December 31, 2025 and 2024 that were included in the balance of contract liabilities at the beginning of the periods were $737,703 and $222,498, respectively.

(u) Compensation to employees and directors

On May 28, 2025, the Company resolved at the shareholders’ meeting to amend its Articles of Incorporation. According to the amended Articles, if there is any profit before tax prior to deduction of the compensation of employees and directors in a fiscal year, it shall first be used to offset against any accumulated deficits. Thereafter, no more than 2% of the remaining net profit shall be allocated as directors’ compensation and no less than 5% as employee compensation, including a minimum of 5% to those non-executive employees.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

Prior to the amendment, the Articles of Incorporation stipulated that, if there is any profit before tax prior to deduction of the compensation of employees and directors in a fiscal year, it shall first be used to offset against any accumulated deficits. Thereafter, no more than 2% of the remaining net profit shall be allocated as directors’ compensation and no less than 5% as employee compensation.

In the event that the Company has accumulated losses, the Company shall reserve an amount to offset its accumulated losses. Employees who are entitled to receive the above-mentioned employee compensation, in share or cash, may include the employees who serve in the subsidiaries of the Company who meet certain specific requirements.

For the years ended December 31, 2025 and 2024, the Company accrued employee compensation of $469,507 (including distribution to the non-executive employees) and $421,162, and directors’ remuneration of $24,968 and $22,792, respectively. The estimated amounts mentioned above are based on the income before tax prior to deduction of the compensation to employees and directors of each respective ending period, multiplied by the percentages of compensation to employees and directors, which were approved by the management of the Company. The estimations were recorded under operating costs or operating expenses for 2025 and 2024. The differences between the actual amounts and the estimations recognized in the financial statements, if any, are accounted for as changes in accounting estimates and recognized as profit or loss in the distribution year. If the Board of Directors resolves to distribute employee compensation in the form of stock, the number of the shares of the employee compensation is determined based on the closing price of the day before the Board of Directors’ meeting.

There is no difference between the compensation of employees and directors resolved by the Board of Directors and the estimated amounts recognized in the parent-company-only financial statement for the years ended December 31, 2025 and 2024. The actual distribution of compensation of employees and directors was consistent with the estimated amounts and was paid in cash for the year ended December 31, 2024. Related information can be accessed through the Market Observation Post System website.

(v) Financial instruments

(i) Credit risk
1) Maximum exposure to credit risk

The carrying amount of financial assets and contractual assets represents the maximum amount exposed to credit risk.

2) Concentration of credit risk

The Company’s revenue is primarily concentrated among certain major customers, while its sales regions are widely spread. As accounts receivable at the end of the year were not significantly concentrated on any specific customers, therefore, there is no significant concentration of credit risk. To manage credit risk, the Company continually evaluates the financial condition, operating scale, and credit ratings of its customers, and adopts appropriate credit control measures based on customers’ credit profiles.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

3) Receivables and debt risk

For credit risk exposure of accounts receivable, please refer to note (6)(f).

Other financial assets at amortized cost includes other receivables (including related parties), repurchase agreements and time deposits. All of these financial assets are considered to have low risk, and thus, the impairment provision during the period was measured at an amount equal to 12 months expected losses. Regarding how the financial instruments are considered to have low credit risk, please refer to note (4)(f). Besides, due to the counterparties of the time deposits and repurchase agreements held by the Company are the financial institutions with investment grade and above credit ratings, these time deposits and repurchase agreements are considered to have low credit risk.

The movements of allowance for the years ended December 31, 2025 and 2024 were as follows:

Balance at January 1, 2025 Impairment loss reserved Balance at December 31, 2025 Balance at January 1, 2024 Impairment loss reserved Balance at December 31, 2024	Other receivables $ 8,220 (5,015) $ 3,205 $ 12,418 (4,198) $ 8,220

(ii) Liquidity risk

The following are the contractual maturities of financial liabilities. Except for lease liabilities , the other amounts exclude estimated interest payments.

Carrying amount December 31, 2025 Non-derivative financial liabilities Unsecured bank borrowings $ 184,700 Accounts payable (including related parties) 11,040,240 Other payables (including related parties) 7,467,173 Lease liability`－`current and non-current 10,987 Deposits received 33,253 Derivative financial liabilities Other foreign exchange forward contracts: 15,395 Outflow Inflow Foreign exchange forward contracts used for hedging: 2,870 Outflow Inflow $ 18,754,618	Contractual cash flows (184,700) (11,040,240) (7,467,173) (11,065) (33,253) (874,840) 857,401 (252,480) 248,769 (18,757,581)	Within a year (184,700) (11,040,240) (7,467,173) (10,427) (1,509) (874,840) 857,401 (252,480) 248,769 (18,725,199)	1~ 2 years - - - (638) - - - - - (638)	Over 2 years - - - - (31,744) - - - - (31,744)

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

December 31, 2024 Non-derivative financial liabilities Unsecured bank borrowings Accounts payable (including related parties) Other payables (including related parties) Lease liability`－`current and non-current Deposits received	Carrying amount $ 341,300 8,393,641 6,330,193 22,205 34,575 $ 15,121,914	Contractual cash flows (341,300) (8,393,641) (6,330,193) (22,482) (34,575) (15,122,191)	Within a year (341,300) (8,393,641) (6,330,193) (11,775) (1,374) (15,078,283)	1~ 2 years - - - (10,069) (135) (10,204)	Over 2 years - - - (638) (33,066) (33,704)

The Company is not expecting that the cash flows included in the maturity analysis could occur significantly earlier or at significantly different amounts.

(iii) Currency risk

1) Exposure to foreign currency risk

The Company’ s significant exposure to financial assets and liabilities for foreign currency risk were as follows:

Unit: thousand of foreign currency

Financial assets Monetary items USD EUR Financial liabilities Monetary items USD USD	December 31, 2025 Foreign currency Exchange rate TWD $ 853,405 USD/TWD =31.375 26,775,582 38,984 EUR/TWD =36.940 1,440,069 988,388 USD/TWD =31.375 31,010,674 5,414 USD/TWD =36.940 199,993	December 31, 2024
	Foreign currency Exchange rate $ 853,405 USD/TWD =31.375 38,984 EUR/TWD =36.940 988,388 USD/TWD =31.375 5,414 USD/TWD =36.940	Foreign currency Exchange rate TWD 707,603 USD/TWD =32.725 23,156,308 18,486 EUR/TWD =34.130 630,927 726,825 USD/TWD =32.725 23,785,348 10,244 USD/TWD =34.130 349,628

2) Sensitivity analysis

The Company’s exposure to foreign currency risk arises mainly from the translation of the foreign currency exchange gains and losses on cash and cash equivalents, accounts receivable (including related parties), other receivables (including related parties), loans and borrowings, accounts payable (including related parties), and other payables (including related parties) that are denominated in foreign currency. The analysis assumes that all other variables remain constant. A strengthening (weakening) 5% of each foreign currency against the functional currency as of December 31, 2025 and 2024 would have affected the net income before tax for the years end December 31, 2025 and 2024 as follows. The analysis is performed on the same basis for both periods.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

USD (against the TWD) Strengthening 5% Weakening 5% EUR (against the TWD) Strengthening 5% Weakening 5%	December 31, 2025 December 31, 2024 $ (211,755) (31,452) 211,755 31,452 $ 62,004 14,065 (62,004) (14,065)

3) Exchange gains and losses of monetary items

As the Company deals in diverse foreign currencies, gains or losses on foreign exchange were summarized as a single amount. For the years ended December 31, 2025 and 2024, the net foreign exchange (losses) gains (including realized and unrealized portions) amounted to $(52,220) and $41,659, respectively.

(iv) Interest rate analysis

The Company’ s risk exposure to financial assets and liabilities for interest rate were as follows:

follows:
Fixed rate financial instrument: Financial assets Financial liabilities Variable rate financial instrument: Financial assets	Carrying amount December 31, 2025 December 31, 2024 $ 10,252,849 8,203,852 (184,700) (341,300) $ 10,068,149 7,862,552 $ 2,037,003 3,763,645
	December 31, 2025 $ 10,252,849 (184,700) $ 10,068,149 $ 2,037,003

The following sensitivity analysis is based on the risk exposure to interest rate for the nonderivative financial instruments on the reporting date. Regarding the assets and liabilities with variable interest rates, the analysis is on the basis of the assumption that the amount of assets and liabilities outstanding at the reporting date were outstanding throughout the whole year. The rate of change used for internal reporting to management internally is expressed as the interest rate increase or decrease by 0.25%, which also represents management of the Company’ s assessment on the reasonably possible range of interest rate changes.

If the interest rate had increased or decreased by 0.25% on the reporting date, assuming all other variables factors remaining constant, the net income before tax would have increased or decreased by $5,093 and $9,409 for the years ended December 31, 2025 and 2024, respectively, mainly due to the Company's bank deposits with variable interest rates.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(v) Fair value information

1) The categories of financial instruments and fair value

The Company’ s financial assets and liabilities at fair value through profit or loss, financial assets and liabilities used for hedging and financial assets at fair value through other comprehensive income are measured at fair value on a recurring basis. The carrying amounts and fair values of the Company’ s financial assets and liabilities (including the information on fair value hierarchy, but excluding financial instruments not measured at fair value whose carrying amount reasonably approximates to the fair value, and lease liabilities, as the disclosure of fair value information is not required), were as follows:

Book value Financial assets at fair value through profit or loss Derivative financial assets $ 4,254 Non-hedging derivative financial assets mandatorily measured at fair value through profit or loss 38,614 Subtotal 42,868 Derivative Financial Assets for Hedging 13,181 Financial assets measured at fair value through other comprehensive income Stocks unlisted on domestic markets 10,609 Financial assets measured at amortized cost Cash and cash equivalents 3,478,021 Time deposits with original of more than three months 8,800,000 Accounts receivable, net (including related parties) 6,209,584 Other receivables (including related parties) 683,117 Refundable deposits 59,894 Subtotal 19,230,616 Total $ 19,297,274			December 31, 2025	December 31, 2025	December 31, 2025
	Book value			Fair value
			Level 1 - - - - - - - - -	Level 2 4,254 - 13,181 - - - - - -	Level 3 Total - 4,254 38,614 38,614 - 13,181 10,609 10,609 - - - - - - - - - -

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

		December 31, 2025 Fair value Level 1 Level 2 Level 3 Total - 15,395 - 15,395 - 2,870 - 2,870 - - - - - - - - - - - - - - - - - - - - December 31, 2024	December 31, 2025 Fair value Level 1 Level 2 Level 3 Total - 15,395 - 15,395 - 2,870 - 2,870 - - - - - - - - - - - - - - - - - - - - December 31, 2024	December 31, 2025 Fair value Level 1 Level 2 Level 3 Total - 15,395 - 15,395 - 2,870 - 2,870 - - - - - - - - - - - - - - - - - - - - December 31, 2024
Book value



	Book value		Fair value
		Level 1 - - - - - - - -	Level 2 - - 726,088 - - - - -	Level 3 Total 37,965 37,965 19,437 19,437 - 726,088 - - - - - - - - - -

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

	December 31, 2024	December 31, 2024	December 31, 2024
Book value		Fair value
	Level 1 - - - - -	Level 2 - - - - -	Level 3 Total - - - - - - - - - -
$ 341,300 8,393,641 6,330,193 22,205 34,575 $ 15,121,914

2) Fair value valuation technique for financial instruments not measured at fair value

The Company estimates financial instruments that not measured at fair value by methods and assumptions as follows:

a) Financial assets and financial liabilities measured at amortized cost

If there is quoted price generated by transactions, the most recent transaction price and quoted price data is used as the basis for fair value measurement. However, if no quoted prices are available, the discounted cash flows are used to estimate fair values.

3) Fair value valuation technique for financial instruments measured at fair value
a) Non-derivative financial instruments

Financial instruments trade in active markets are based on quoted market prices. The quoted price of a financial instrument obtained from main exchanges and onthe-run bonds from Taipei Exchange can be used as a basis to determine the fair value of the listed companies’ equity instrument and debt instrument of the quoted price in an active markets.

Fair value measured using a valuation technique can be determined by reference to the fair value of similar financial instruments, the discounted cash flow method, or other valuation techniques, including models that incorporate observable market information available at the reporting date.

The Company holds the unquoted equity investments of financial instruments without an active market. The measurement of fair value of the equity instruments is based on the Guideline listed Company method, which mainly assumes the evaluation by the price-to-book ratio of comparable public companies and by the discount for lack of marketability. The estimation has been adjusted for the effect of the discount due to the lack of marketability for the equity securities.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

b) Derivative financial instruments

Measurement of fair value of derivative instruments is based on the valuation techniques that are generally accepted by the market participants, such as discount method or option pricing models. Fair value of foreign exchange forward contracts is usually determined by using the forward currency rate.

There were no transfers between fair value levels in 2025 and 2024.

4) Transfers between Level 1 and Level 2

There were no transfers from Level 2 to Level 1 in 2025 and 2024.

5) Reconciliation of Level 3 fair values

Balance at January 1, 2025
Proceeds from capital reduction of investments
Total gains and losses recognized
In profit or loss
In other comprehensive income
Balance at December 31, 2025
Balance at January 1, 2024
Proceeds from capital reduction of investments
Total gains and losses recognized
In profit or loss
In other comprehensive income
Balance at December 31, 2024

Fair value through
profit of loss
Fair value through
other comprehensive
income
Non-derivation
financial assets
mandatorily
measured at fair
value through
profit or loss
Equity
instrument
without an
active market
$ 37,965
19,437
(2,563)
-
3,212
-
-
(8,828)
$
38,614
10,609
$ 48,112
35,442
(10,447)
-
300
-
-
(16,005)
$
37,965
19,437

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

For the years ended December 31, 2025 and 2024, total gains and losses mentioned above recognized in “Gains (losses) on financial assets (liabilities) at fair value through profit or loss” and “ unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income” were as follows:

		2025		2024
Total gains and losses recognized:
In profit or loss, and presented in “Gains
( losses) on financial assets(liabilities) at fair value
through profit or loss”		$ 3,212		300
In other comprehensive income, and presented in
“unrealized gains (losses) from investments in
equity instruments measured at fair value
through other comprehensive income”		$ (8,828) (16,005)
Quantified information on significant unobservable inputs (Level 3) used in fair value
measurement
The Company’ s financial instruments that	use Level 3 inputs to		measure fair values
include “financial assets measured at fair value through profit or loss – investments in
private equity fund” and “ financial assets		measured at fair value through other
comprehensive income - equity investments”.
Most of the fair value measurements of the Company which are categorized as Level 3
have several single significant unobservable	inputs. The significant		unobservable inputs
of the equity investments without an active market are independent from each other, as a
result, there is no correlation between them.
Quantified information of significant unobservable inputs was as follows:
				Inter-relationship
				between significant
		Significant		unobservable inputs
Item Valuation technique	unobservable inputs			and fair value
Financial assets at fair Comparable market	‧Price-to-Book ratio		‧The higher the
value through other approach		multiples (1.22~1.54		multiple is , the
comprehensive income-		and 1.71~2.07 on		higher the fair value
equity investment		December 31, 2025		will be.
without an active market		and 2024,
		respectively)
	‧Lack-of-Marketability		‧The higher the Lack-
		discount rate (All are		of-Marketability
		30% on December 31,		discount rate is, the
		2025 and 2024)		lower the fair value
				will be.
Financial assets at fair Net asset value	‧ Net asset value		Not applicable
value through profit or method
loss-investment in private
equity fund

6) Quantified information on significant unobservable inputs (Level 3) used in fair value measurement

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

7) Fair value measurements in Level 3 – Sensitivity analysis of reasonably possible alternative assumptions

The Company’s fair value measurement on financial instruments is reasonable. However, the measurement results would be different if different valuation models or parameters are adopted. For financial instruments categorized as Level 3, if the valuation parameters changed, the impacts on other comprehensive income or loss are as follows:

December 31, 2025 Financial assets at fair value through other comprehensive income December 31, 2024 Financial assets at fair value through other comprehensive income	Input Price-to-Book ratio multiples Lack-of- Marketability discount rate Price-to-Book ratio multiples Lack-of- Marketability discount rate	Other comprehensive income Move up or down Favorable change Unfavorable change 5% $ 546 560 5% $ 231 227 5% $ 1,001 1,000 5% $ 425 425	Other comprehensive income	Other comprehensive income
				Unfavorable change
				560
				227
				1,000
				425

The favorable and unfavorable changes represent the fluctuations in fair value, which are calculated using valuation techniques based on various degrees of unobservable inputs. If the fair value of a financial instrument is affected by more than one input, the table above only reflects the impact of changes in a single input, and does not consider the correlation and variance between other inputs.

(w) Financial risk management

(i) Overview

The Company is exposed to the following risks arising from financial instruments:

1) Credit risk
2) Liquidity risk
3) Market risk

This note presents information about the Company's exposure to each of the above risk, the Company's objectives, policies and process for measuring and managing risk. For detailed quantitative disclosures, please refer to the related notes through the financial statement.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(ii) Structure of risk management

The Company’s risk management policies are established for identifying and analyzing the risk that the Company confronts, determining the appropriate risk limits and controls, and monitoring the compliance with risk and risk limits. The Company reviews the risk management policies periodically to reflect the market condition and the changes of the Company’s operation. The Company develops a disciplined and constructive environment and ensures that all employees understand their rules and obligations through training, management guidelines, and operating procedures.

The Audit Committee of the Company oversees how management monitors compliance with the Company’s risk management policies and procedures, and reviews the appropriateness of the related risk management framework. The Company’ s internal auditors assist the Audit Committee by conducting regular and ad hoc reviews of risk management controls and procedures, and report the findings to the Audit Committee and the Board of Directors.

(iii) Credit risk

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

1) Accounts receivable and other receivables

The Company has established a credit policy under which each new customer is assessed individually for creditworthiness before the Company’s standard payment and delivery terms and conditions are offered. The Company’s assessment includes external ratings or financial statements provided by customers (internal ratings). Credit limits are established for each customer, and these limits are reviewed periodically. Customer who do not meet the standard credit rating of the Company may only conduct transactions by either advanced payment or by obtaining the approval by authorized supervisors.

The Company’s customers are mainly from the networking communications industry. In order to mitigate the credit risk of accounts receivable, the Company constantly assesses the financial status of the customers, and requests the customers to provide guarantee or collateral if necessary. The Company regularly assesses the collectability of accounts receivable and recognizes the allowance for accounts receivable. The impairment losses are always within management’s expectation.

The Company maintains the allowance for bad debt account to reflect the estimated losses for accounts receivables and other receivables. The allowance for bad debt account is based on extensive analysis for customers’ creditworthiness and historical payments records.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

2) Investments

The credit risk exposure for bank deposits and other financial instruments is measured and monitored by the Company’s finance department. Since the Company’s transaction counterparties and the contractually obligated counterparties are creditworthy banks, financial institutions and corporate organizations with good credits ratings and investment grade, there are no compliance issues, and therefore, no significant credit risk.

3) Guarantees

According to the Company's policy, financial guarantees may only be provided to the parties specified under the Endorsement and Guarantee Guidelines. As of December 31, 2025 and 2024, the Company has not provided any endorsements or guarantees to nonsubsidiaries.

(iv) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset.

The Company manages and maintains sufficient cash and cash equivalents so as to support its operations and mitigate the effects of fluctuations in cash flows. The Company’s management supervises the banking facilities and ensures in compliance with the terms of the loan agreements.

Bank loans and borrowings constitute an important source of liquidity for the Company. As of December 31, 2025 and 2024, for the information of the unused credit lines of bank short-term borrowings, please see note (6)(l).

(v) Market risk

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

In order to manage market risk, the Company enters into derivative instrument transactions, which may result in financial liabilities. Generally, the Company seeks to apply hedge accounting in order to manage volatility in profit or loss.

1) Currency risk

The Company is exposed to currency risk on sales, purchases and borrowings that are denominated in a currency other than the functional currencies of the Company, primarily denominated in USD, with some transactions in EUR and other minor foreign currencies.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

The Company designates the spot element of forward foreign exchange contracts to hedge its currency risk. Most of these contracts have a maturity of less than one year from the reporting date. The forward elements of forward exchange contracts are excluded from designation as the hedging instrument and are separately accounted for as a cost of hedging, which is recognized in equity under "other equity interest - gains (losses) on hedging instruments". The Company’s policy requires the critical terms of the forward exchange contracts to align with those of the hedged items.

The Company determines the existence of an economic relationship between the hedging instruments and hedged items based on the currency, amount and timing of their respective cash flows. The Company assesses whether the derivative designated in each hedging relationship is expected to be and has been effective in offsetting changes in cash flows of the hedged item by using the hypothetical derivative method.

In these hedge relationships, the main sources of hedge ineffectiveness are:

the effect of the counterparty’s and the Company’s own credit risk on the fair value of the forward foreign exchange contracts, which is not reflected in the change in the fair value of the hedged cash flows attributable to the change in exchange rates; and
changes in the timing of the cash flows for hedged transactions.
2) Interest rate risk

The Company borrows funds at fixed and variable interest rates, which has a risk exposure to the risk of changes in fair value and cash flow. Therefore, the Company manages the interest rates risk by maintaining an adequate combination of fixed and variable interest rates.

(x) Capital management

The Company manages the capital based on the current operating characteristics of the industry, future development and changes in external environment to ensure there is sufficient financial resource and operating plan to support working capital, capital expenditures, research & development expense, debt redemption and dividend payment and so on. The management determines the optimal capital structure by using the appropriate debt-to-equity ratio. To maintain a strong capital base, the Company aims to enhance the shareholder returns on equity by optimizing the balance between debt and equity. The Company’ s debt-to-equity ratios at the end of the reporting date were as follows:

Total liabilities Total equity Debt-to-equity ratio	December 31, 2025 December 31, 2024 $ 22,745,151 18,351,813 16,944,704 15,934,969 % 134 % 115

As of December 31, 2025, the decrease in debt-to-equity ratio primarily due to reduction in accounts payable arising from purchases.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(y) Investing and financing activities not affecting current cash flow

The Company’s investing and financing activities which did not affect the current cash flow for the years ended December 31, 2025 and 2024 were as follows:

(i) The acquisition of right-of-use assets by lease, please see note (6)(j).
(ii) Reconciliation of liabilities arising from financing activities were as follows:

Short-term borrowings Lease liabilities Deposits received Total liabilities from financing activities Short-term borrowings Lease liabilities Deposits received Total liabilities from financing activities	January 1, 2025 $ 341,300 22,205 34,575 $ 398,080 January 1, 2024 $ 951,855 33,112 32,745 $ 1,017,712	Cash flows (156,600) (11,925) (1,322) (169,847) Cash flows (610,555) (14,504) 1,830 (623,229)	Non-cash changes Other December 31, 2025 - 184,700 707 10,987 - 33,253 707 228,940 Non-cash changes Other December 31, 2024 - 341,300 3,597 22,205 - 34,575 3,597 398,080	Non-cash changes Other December 31, 2025 - 184,700 707 10,987 - 33,253 707 228,940 Non-cash changes Other December 31, 2024 - 341,300 3,597 22,205 - 34,575 3,597 398,080
				341,300 22,205 34,575
				398,080

(7) Related-party transactions:

(a) Parent company and ultimate controlling party

Compal Electronics Inc. (CEI) is both the parent company and the ultimate controlling party of the Company, holding 33% of outstanding ordinary shares of the Company. CEI has compiled the consolidated financial statements available for public use.

(b) Name and relationship with related parties

The followings are related parties that have had transactions with the Company and subsidiaries during the periods covered in the financial statements.

during the periods covered in the financial statements.
Name of related party	Relationship with the Company
Compal Electronics, Inc.	Parent company
Arcadyan Technology N.A. Corp. (Arcadyan USA)	Subsidiaries
Arcadyan Germany Technology GmbH	`〃`
(Arcadyan Germany)
Arcadyan Holding (BVI) Corp. (Arcadyan Holding)	`〃`
ZHI-BAO Technology Inc. (ZHI-BAO)	`〃`

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

Name of related party	Relationship with the Company
Tatung Technology Inc. (TTI)	Sub-subsidiaries
Arcadyan Technology Corporation Korea	`〃`
(Arcadyan Korea)
Arcadyan do Brasil Ltd (Arcadyan Brasil)	`〃`
Arcadyan Technology Limited (Arcadyan UK)	`〃`
Arcadyan Technology Australia Pty Ltd (Arcadyan	`〃`
AU)
Arcadyan Technology Corporation (Russia), LLC.	`〃`
(Arcadyan RU)
Arcadyan India Private Limited (Arcadyan India)	`〃`
Arcadyan Turkey Technology and Trade Joint	`〃`
Stock Company (Arcadyan Turkey)(note 1)
Arcadyan Technology Japan CO., Ltd (Note 3)	`〃`
Sinoprime Global Inc. (Sinoprime)	`〃`
Arcadyan Technology (Shanghai) Corp. (SVA)	`〃`
Arch Holding (BVI) Corp. (Arch Holding)	`〃`
Compal Networking (Kunshan) Co., Ltd. (CNC)	`〃`
Arcadyan Technology (Vietnam) Co. Ltd	`〃`
(Arcadyan Vietnam)
Tatung Technology of Japan Co., Ltd. (TTJC)(note	`〃`
2)
Quest International Group Co., Ltd. (Quest)	`〃`
Exquisite Electronic Co., Ltd. (Exquisite)	`〃`
Tatung Home Appliance (Wujiang) Co., Ltd.	`〃`
(TCH)
Kinpo Group Management Service Company	An associate of parent company
LIZ Electronics (Nantong) Co., Ltd.(LIZ)	`〃`
Compal Electronics (Vietnam) Co., Ltd. ("CVC")	The entity's ultimate parent company is the same
AcBel Polytech Inc.	Substantial related party

Note 1: The subsidiary was incorporated on May 2, 2024. Note 2: As of November 27, 2024, the subsidiary has completed its dissolution and liquidation process. Note 3: The subsidiary was incorporated on November 25, 2025.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(c) Significant related party transactions

(i) Operating revenue

The amounts of significant sales by the Company to related parties were as follows:

Subsidiaries: Arcadyan USA Other subsidiaries	2025 $ 21,026,271 2,727,345 $ 23,753,616	2024
		18,125,629 1,279,074
		19,404,703

The selling price of sales to subsidiaries and other related parties were not significantly different to those of the third-party customers, with the collection period of 45-120 days.

(ii) Purchases

The amounts of significant purchases from related parties were as follows:

Parent company Subsidiaries Other related parties	2025 $ 144,304 - 29,203 $ 173,507	2024
		62,627 7,418 40,508
		110,553

The payment terms and prices of purchases from related parties were not significantly different from those offered by other vendors. The payment terms were 60 to 120 days from the end of the month of delivery.

(iii) Processing fees

Subsidiaries: Arcadyan Vietnam CNC	2025 $ 11,624,966 - $ 11,624,966	2024
		6,739,286 261,050
		7,000,336

The Company sold raw materials to related parties due to the demand of processing raw materials. The related revenue and cost had been eliminated in the financial statements, and not being considered as sales of raw materials and purchases of finished goods.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(iv) Other expenditures

The parent company and other related parties provided technical support, professional services and other services to the Company, and the related expenses for the years ended December 31, 2025 and 2024 were as follows:

2025 and 2024 were as follows:
Parent company Subsidiaries Other related parties	2025 $ 9,187 316,131 1,159 $ 326,477	2024
		267 298,586 1,114
		299,967

(v) Receivables from related parties

The receivables and contract liabilities arising from the transactions and other payments on behalf of related parties mentioned above were as follows:

Account	Related party categories	December 31, 2024
Accounts receivable Other receivables Contract Liabilities	Other subsidiaries: Parent company Subsidiaries: Arcadyan Vietnam Other subsidiaries Arcadyan USA	266,924
		- 1,411,290 898
		1,412,188
		650,097

The Company sold raw materials to its parent company for toll manufacturing purposes. The related revenues and costs, which were not recognized as sales of raw materials and purchases of semi-finished goods, have been eliminated in the financial statements.

(vi) Payables to related parties

The payables arising from the transactions mentioned above, and other payments on behalf of the related parties were as follows:

Account Accounts payable Accounts payable Other payable Other payable	Related party categories	December 31, 2025 $ 38,922 1,681,975 1,167 15,884 $ 1,737,948 $ - 348,964 $ 348,964	December 31, 2024
	Parent company Subsidiaries: Arcadyan Vietnam Other subsidiaries Other related parties Parent company Subsidiaries		37,350 - 836,815 10,584
			884,749
			234 215,360
			215,594

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(vii) Loans to related parties

The loans to related parties (including interest receivable) were as follows:

Subsidiaries: Arcadyan Brazil Arcadyan Turkey Less: Credit balance of investments accounted for using equity method transferred to deduction of other receivables from related parties	December 31, 2025 $ 63,478 - (56,409) $ 7,069	December 31, 2024
		49,725 83,536 (49,725
		83,536

The Company has granted loans to related parties and the interest rates were set based on the average interest rates of the unsecured short-term loans that the Company borrowed from financial institutions in the current year. All the loans are not guaranteed loans. There are $728 and $2,360 interest receivables for the years ended December 31, 2025 and 2024, which are recognized in other receivables, and no provisions of loss allowance required after the assessment. The interest income for the years ended December 31, 2025 and 2024, amounted to $4,041 and $4,268, respectively.

(viii) Guarantees

As of December 31, 2025 and 2024, the outstanding balances of guarantees provided by the Company to its subsidiaries amounted to $235,313 and $245,438 , respectively.

(d) Transactions with key management personnel compensation

Key management personnel compensation comprised:

2025 Short-term employee benefits $ 141,220 Post-employment benefits 1,159 $ 142,379	2024 134,463 1,150 135,613

(8) Pledged assets:

The carrying amount of pledged assets were as follows:

Assets Time deposits (recorded as other non-current assets)	Purpose of Pleaged December 31, 2025 Performance Guarantees $ 16,359	December 31, 2024 16,139

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(9) Significant contingent liabilities and unrecognized commitments:

As of December 31, 2025 and 2024, the Company has entered into agreements for the factory construction, where the amount contracted but not yet due for payments were $350,200 and $220,354, respectively.

(10) Losses due to major disasters: None.

(11) Subsequent events: None.

(12) Other:

(a) The followings are the summary statement of current period employee benefits, depreciation and amortization expenses by function:

By function By item	2025	2025	2025	2024	2024	2024
	Operating cost	Operating expenses	Total	Operating cost	Operating expenses	Total
Employee benefits Salary Labor and health insurance Pension Remuneration of directors Others Depreciation Amortization	61,611 3,780 1,945 - 1,773 74,932 360	1,940,553 126,138 58,520 24,968 62,615 144,877 43,355	2,002,164 129,918 60,465 24,968 64,388 219,809 43,715	56,164 3,441 1,944 - 1,579 61,365 775	1,736,125 115,331 54,849 22,792 56,315 153,912 52,906	1,792,289 118,772 56,793 22,792 57,894 215,277 53,681

The following are the additional information on the numbers of the Company's employees and their benefits:

benefits:
		2025	2024
Number of employees		1,015		967
Number of directors who were not employees		7		7
The average employee benefit	$	2,239		2,110
The average salaries and wages	$	1,986		1,867
Average salary expense adjustment		% 6.37
Remuneration of supervisors	$	-	-

The Company's salary and remuneration policy (including directors, managers and employees) is as follows:

The remuneration distribution for each director depends on degree of participation and contribution to the Company, which is reviewed by the Salary and Remuneration Committee and is approved by the Board of Directors.

The remuneration of managers is according to the position held, contribution to the Company, performance indicators achieved and reference to competitors, the payment shall be reviewed by the Salary and Remuneration Committee and be approved by the Board of Directors.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

The salary of employees not only refers to holiday bonus, but also refer to year end bonus and employee remuneration. Annual salary adjustment based on performance and reference to industry standards. The salary adjustment refers to competitors, employee’s education, professional technical ability and work experience.

(13) Other disclosures:

(a) Information on significant transactions:

The followings were the information on significant transactions required by the “ Regulations Governing the Preparation of Financial Reports by Securities Issuers” for the Group for the year ended December 31, 2025:

(i) Loans to other parties:

Unit: In thousand dollars of TWD/USD

No.	Name of lender	Name of borrower	Account name	Related party	Highest balance of financing to other parties during the period	Ending balance	Actual usage amount during the period	Range of interest rates during the period	Purposes of fund financing for the borrower (Note 1)	Transaction amount for business between two parties	Reasons for short-term financing	Allowance for bad debt	Collateral	Collateral	Individual funding loan limits (Note 2)	Maximum limit of fund financing (Notes 2)	Note
													Item	Value
0 0 0 0	The Company `〃` `〃` `〃`	Arcadyan do Brasil Ltda. `〃` Arcadyan Turkey Technology and Trade Joint Stock Company Arcadyan Technology Limited	Other receivables `〃` `〃` `〃`	Yes Yes Yes Yes	66,200 (USD2,000) 94,200 (USD3,000) 132,400 (USD4,000) 157,000 (USD5,000)	- 94,125 (USD3,000) - 156,875 (USD5,000)	- 62,750 (USD2,000) - -	5.5% 4.6% 6% 4.8%	2 2 2 1	- - - 1,568,750 (USD50,000)	Operating Turnover Operating Turnover Operating Turnover -	- - - -	- - - -	- - - -	3,388,940 3,388,940 3,388,940 1,255,000	6,777,881 6,777,881 6,777,881 6,777,881

Note 1: Number 1 represents the business relationship with the Company; number 2 represents the short-term financing facility, if necessary.

Note 2: According to the policy of the Company on Lending Funds to Other Parties, the total amount of loans to others shall not exceed 40% of the net worth of the Company. To borrowers having business relationship with the Company, the total amount of loans to the borrower shall not exceed 80% of the transaction amount in the latest fiscal year or the expected amount for the current year, and shall not exceed 20% of the net worth of the Company. Also, the amount shall be aggregated with the Company’ s endorsements/guarantees for the borrower upon calculation. When a short-term financing facility is deemed necessary, only the investees of the Company are permitted to borrow. The total amount of loans to the borrower shall not exceed 20% of the net worth of the Company, and it shall be aggregated with the Company’s endorsements/guarantees for the borrower upon calculation. Inter-company loans of funds between overseas companies in which the Company holds, directly or indirectly, 100% of the voting shares, or loans of fund to the Company made by any overseas company in which the Company holds, directly or indirectly, 100% of the voting shares, shall not apply to the restriction in paragraph 1 and paragraph 3, but the aggregate total amount of loans to borrowing companies shall not exceed the net worth of the lending company.

Note 3: Except for the highest balance, all amounts have been translated into TWD using the exchange rate of [email protected] at the end of the reporting period.

(ii) Guarantees and endorsements for other parties:

Unit: In thousand dollars of TWD/USD

No.	Name of guarantor	Counter-party of guarantee and endorsement	Counter-party of guarantee and endorsement	Limitation on amount of guarantees and endorsements for a specific enterprise (Note 1)	Highest balance for guarantees and endorsements during the period	Balance of guarantees and endorsements as of reporting date	Actual usage amount during the period	Property pledged for guarantees and endorsement (Amount)	Ratio of accumulated amounts of s guarantees and endorsements to net worth of the latest financial statements	Maximum amount for guarantees and endorsements (Note 1)	Parent company endorsements/ guarantees to third parties on behalf of subsidiary	Subsidiary endorsement / guarantees to third parties on behalf of parent company	s Endorsements/ guarantees to third parties on behalf of companies in Mainland China
		Name	Relationship with the Company (Note 2)
0 T C	he ompany	Arcadyan Technology Australia Pty Ltd	2	2,259,293	248,250 (USD7,500)	235,313 (USD7,500)	-	-	% 1.39	6,777,881	Y	N	N

Note 1: The total amount of endorsements/ guarantees the Company or the Group is permitted to provide shall not exceed 40% of the Company’ s net worth. The total amount of endorsements/ guarantees the Company or the Group is permitted to provide for a single company shall not exceed one-third (1/3) of the aforementioned amount of limitation.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

Note 2: Relationships between endorsers/ guarantors and endorsees/ guarantees party are categorized into the following seven types:

1.Companies having business transactions with the Company.
2.Companies in which the Company directly or indirectly holds more than 50% of the voting shares.
3.Companies that directly or indirectly hold more than 50% of the voting shares of the Company.
4.Transactions between companies in which the Company directly or indirectly holds more than 90% of the voting shares.
5.Mutual guarantees between companies in the same industry of co-developers, as required by contractual obligations for construction projects.
6.Endorsements or guarantees provided by all shareholders in proportion to their shareholdings due to joint investment relationships.
7.Joint and several guarantees provided between companies in the same industry for performance obligations under pre-sale housing contracts in accordance with consumer protection laws.
(iii) Significant securities held as of December 31, 2025 (excluding investment in subsidiaries, associates and joint ventures): None.
(iv) Related-party transactions for purchases and sales with amounts exceeding the lower of TWD100 million or 20% of the capital stock:

Unit: In thousand dollars of TWD

Name of company	Counter party	Nature of relationship		Transaction details	Transaction details	Transaction details	Transacti terms diffe othe	ons with rent from rs	Accounts receivable (payable)	Accounts receivable (payable)	Note
			Purchases/ (Sales)	Amount	Percentage of total Purchases/ (Sales)	Payment terms	Unit price	Payment terms	Ending balance	Percentage of total Accounts Receivable (Payable)
The Company `〃` `〃` `〃` `〃` Arcadyan Vietnam `〃` `〃` Arcadyan USA Arcadyan AU Arcadyan Germany	Arcadyan USA Arcadyan AU Arcadyan Germany Arcadyan Vietnam CEI The Company CEI CVC The Company The Company The Company	Subsidiary `〃` `〃` `〃` Parent company of the Company Parent company Parent company of the Company The ultimate parent company is the same Parent company Parent company Parent company	(Sales) (Sales) (Sales) Purchases Purchases (Sales) Purchases Purchases Purchases Purchases Purchases	(21,026,271) (1,473,556) (1,190,967) 11,624,966 144,304 (11,624,966) 3,342,415 755,253 21,026,271 1,473,556 1,190,967	(44)% (3)% (3)% 15 % - % (100)% 8 % 2 % 100 % 100 % 100 %	Net 120 days from delivery Net 60 days from the end of the month of delivery Net 150 days from delivery Net 180 days from the end of the month of delivery Net 60 days from the end of the month of delivery Net 180 days from the end of the month of delivery Net 60 days from the end of the month of delivery Net 60 days from the end of the month of delivery Net 120 days from delivery Net 60 days from the end of the month of delivery Net 150 days from delivery	- - - According to cost plus pricing - According to cost plus pricing - - - - -	- - - - - - - - - - -	16 113,766 301,219 (1,681,975) (38,922) 1,681,975 (1,274,231) (103,683) (16) (113,766) (301,219)	- % 2 % 5 % - % - % - % (5)% - % (100)% (100)% (100)%	Note 1 Note 1

Note 1: The ending balances were derived from the net transactions on processing and sales of raw materials .

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(v) Receivables from related parties with amounts exceeding the lower of TWD100 million or 20% of the capital stock:

Unit: In thousand dollars of TWD

Name of company	Counter-party	Nature of relationship	Ending balance	Turnover rate	Overdue	Overdue	Amounts received in subsequent period (Note 4)	Allowance for bad debts	Note
					Amount	Action taken
The Company `〃` `〃` CNC Arcadyan Vietnam	Arcadyan Germany Arcadyan AU CEI The Company The Company	Subsidiary `〃` Parent company of the Company Parent company `〃`	301,219 113,766 523,352 (Note 1) 222,548 (Note 2) 1,681,975 (Note 3)	5.21 15.29 (Note 1) (Note 2) (Note 3)	- - - - -		153,274 113,766 523,352 - 1,384,832	- - - - -

Note 1: Represents other receivables arising from sale of raw materials. Note 2: Represents other receivables arising from supply chain of support fees. Note 3: Represents other receivables arising from contract processing services. Note 4: Information as of February 11, 2026.

(b) Information on investees:

The following is the information on investees for the year ended December 31, 2025 (excluding information on investees in Mainland China):

Unit: In thousand dollars of TWD and USD and thousand shares

Investor company	Investee company	Location	Main businesses and products	Original investment amount	Original investment amount	Ending Balance as of December 31, 2025	Ending Balance as of December 31, 2025	Ending Balance as of December 31, 2025	Net Income (Losses) of the Investee	Share of Income (losses) of the Investee	Note
				December 31, 2025	December 31, 2024	Shares	Percentage of ownership	Carrying value
The Company The Company The Company The Company The Company and ZHI-BAO The Company The Company The Company The Company The Company The Company and ZHI-BAO The Company and ZHI-BAO The Company The Company Arcadyan Holding `〃`	Arcadyan Holding Arcadyan USA Arcadyan Germany Arcadyan Korea Arcadyan Brasil ZHI-BAO TTI Arcadyan UK Arcadyan AU Arcadyan RU CBN Arcadyan India Arcadyan Turkey Arcadyan Japan Sinoprime Arch Holding	British Virgin Islands USA Germany Korea Brazil Hsinchu City Taipei City United kingdom Australia Russia Hsinchu County India Turkey Japan British Virgin Islands British Virgin Islands	Investment activities Selling and technical support of wireless networking products Selling and technical support of wireless networking products Selling of wireless networking products Selling of wireless networking products Investment activities Research and development, and selling digital home appliance Selling and technical support of wireless networking products Selling of wireless networking products Selling of wireless networking products Manufacturing and selling of broadband network products Selling of wireless networking products Selling of wireless networking products Selling of wireless networking products Investment activities Investment activities	1,375,362 23,055 1,125 2,879 81,593 48,000 308,726 1,988 1,161 7,672 48,197 76,952 61,268 2,008 911,444 (USD29,050) 31,720 (USD1,011)	1,701,027 23,055 1,125 2,879 81,593 48,000 308,726 1,988 1,161 7,672 48,197 76,952 61,268 - 911,444 (USD29,050) 345,470 (USD11,011)	37,780 1 0.5 20 968 34,980 25,028 50 50 - 13,673 19,800 6,200 1 29,050 1	100% 100% 100% 100% 100% 100% 61% 100% 100% 100% 19.90% 100% 100% 100% 100% 100%	2,344,456 192,365 122,296 33,152 (56,081) 291,839 138,612 7,257 118,207 375 183,497 38,573 53,070 2,012 2,295,991 (USD73,179) 163,872 (USD5,223)	296,600 43,679 10,410 (2,299) 503 (19,445) (8,212) 741 29,777 (652) (65,217) 90,338 6,323 (1) 387,256 (USD12,420) (145,517) (USD(4,667))	296,600 43,679 10,410 (2,299) 503 (19,445) (5,013) 741 29,777 (652) (14,866) 90,338 6,323 (1) 387,256 (USD12,420 (99,870) (USD(3,203))	Notes 2, 6 Note 2 `〃` `〃` `〃` `〃` `〃` `〃` `〃` `〃` Note 3 Note 2 Note 2 Note 4 Note 2 Notes 2, 5

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

Investor company	Investee company	Location	Main businesses and products	Original investment amount	Original investment amount	Ending Balance as of December 31, 2025	Ending Balance as of December 31, 2025	Ending Balance as of December 31, 2025	Net Income (Losses) of the Investee	Share of Income (losses) of the Investee	Note
				December 31, 2025	December 31, 2024	Shares	Percentage of ownership	Carrying value
Sinoprime TTI Quest	Arcadyan Vietnam Quest Exquisite	Vietnam Samoa Samoa	Manufacturing of wireless networking products Investment activities Investment activities	909,875 (USD29,000) 37,650 (USD1,200) 36,709 (USD1,170)	909,875 (USD29,000) 37,650 (USD1,200) 36,709 (USD1,170)	- 1,200 1,170	100% 100% 100%	2,291,254 (USD73,028) 8,153 7,279 (USD232)	387,256 (USD12,420) (873) (873) (USD(28))	387,256 (USD12,420) (873) (873) (USD(28))	Note 2 `〃` `〃`

Note 1: The amounts in New Taiwan Dollars were translated at the exchange rate of [email protected] based on the average exchange rate for net income (losses) of the investees, others were translated at the exchange rate of [email protected] based on the reporting date.

Note 2: The Group has owner control.

Note 3: The Group has significant influence.

Note 4: The subsidiary was incorporated on November 25, 2025.

Note 5: On July 28, 2025, the Company's subsidiary, Arch Holding, completed a capital reduction and returned capital in the amount of USD 10,000 thousand to Arcadyan Holding. Note 6: On December 30, 2025, the Company's subsidiary, Arcadyan Holding, completed a capital reduction and returned capital in the amount of USD 10,000 thousand to the Company.

(c) Information on investment in Mainland China:

(i) The names of investees in Mainland China, the main businesses and products, and other information:

==> picture [464 x 145] intentionally omitted <==

----- Start of picture text -----

Unit: In thousand dollars of TWD and USD
Investment flows
Accumulated Accumulated
Name of Main businessesand amountTotal Methodof Taiwan as of investment outflow offrom investment fromDecember 31,Taiwan as of outflow of income(losses)Net Percentageof Investmentincome Book remittance ofAccumulatedearnings incurrent
investee products of paid-in capital investment January 1, 2025 Outflow Inflow 2025 of the investee ownership (losses) value period Note
SVA Research and 254,138 Note 1 (Note 4) - - 421,053 6,298 100% 6,298 56,506 - Note 3
421,053
development, and sale of (USD8,100) (USD13,420) (USD202) (USD202) (USD1,801)
wireless networking (USD13,420)
products
CNC Manufacturing of 76,869 Notes 1, 6 (Note 5) - (313,750) 31,720 (146,702) 100% (146,702) 315,978 - 〃
345,470
wireless networking (USD2,450) (USD10,000) (USD1,011) (USD(4,705)) (USD(4,705)) (USD10,071)
products (USD11,011)
TCH Manufacturing of digital 379,794 Notes 1, 7 36,081 - - 36,081 (2,681) 100% (2,681) 20,362 - 〃
(USD1,150) (USD1,150) (USD(86)) (USD(86)) (USD649)
home appliance products (USD12,105) and 8
----- End of picture text -----

Note 1: Investment in Mainland China through companies registered in a third region.

Note 2: The amounts in New Taiwan Dollars were translated at the exchange rate of [email protected] based on the average exchange rate for net income (losses) of the investees, others were translated at the exchange rate of [email protected] based on the reporting date.

Note 3: The amounts are based on financial statements that have been audited by parent company's independent auditors.

Note 4: The Company paid US$18,420 thousands and acquired 100% shares of SVA from Accton Asia through Arcadyan Holding in 2010. Note 5: The Company paid US$8,561 thousands and acquired 100% shares of CNC from Just through Arcadyan Holding in 2007. Note 6: The Company’s subsidiary, CNC, conducted a capital reduction and returned share capital in the amount of USD10,000 thousands. Note 7: The Company’s subsidiary, TTI, obtained control over TCH for USD1,150 thousands on February 28, 2013 (base date of stock transferring). Note 8: The Company’s subsidiary, TTI, increased the capital of TCH by converting its accounts receivable amounting to USD8,755 thousands on August 16, 2023.

(ii) Limitation on investment in Mainland China:

Accumulated Investment in Mainland China as of December 31, 2025	Investment Amounts Authorized by Investment Commission, MOEA	Upper Limit on Investment in Mainland China by Investment Commission, MOEA
488,854 (USD25,581)	763,542 (USD24,336)	10,166,822

Note : The amounts in TWD were translated at the exchange rate of [email protected] at the reporting date.

(Continued)

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(iii) Significant transactions:

The significant inter-company transactions with the subsidiaries in Mainland China for the year ended December 31, 2025, are disclosed in “Information on significant transactions.”

(14) Segment information:

Please refer to the consolidated financial statements for the year ended December 31, 2025 .

ARCADYAN TECHNOLOGY CORPORATION

Statement of cash and cash equivalents

December 31, 2025

(Expressed in thousands of TWD)

Item Cash on hand Checking accounts and demand deposits Time deposits Repurchase agreements Total Note: The exchange rate: USD1 = EUR1 = AUD1 =	Description Amount $ 4,504 TWD 412,771 Foreign currency (USD47,377 thousand, EUR3,425 thousand and others) 1,624,256 2,037,027 AUD (maturity date: January 14, 2026~January 28, 2026 interest rate 3.32%~3.37%) 236,490 TWD (maturity date: January 14, 2026, interest rate 1.3%) 1,200,000 $ 3,478,021 TWD 31.375 TWD 36.94 TWD 21.04	Description Amount $ 4,504 TWD 412,771 Foreign currency (USD47,377 thousand, EUR3,425 thousand and others) 1,624,256 2,037,027 AUD (maturity date: January 14, 2026~January 28, 2026 interest rate 3.32%~3.37%) 236,490 TWD (maturity date: January 14, 2026, interest rate 1.3%) 1,200,000 $ 3,478,021 TWD 31.375 TWD 36.94 TWD 21.04

Statement of financial assets measured at amortized

cost-current

Please refer to note (6)(e).

ARCADYAN TECHNOLOGY CORPORATION

Statement of accounts receivable

December 31, 2025

(Expressed in thousands of TWD)

Client Name X Corporation II Corporation V Corporation VI Corporation XII Corporation I Corporation XIII Corporation III Corporation Other (note) Total Less: Allowance for uncollectible accounts Net amount	Description Amount Non-related parties $ 883,748 `〃` 819,073 `〃` 786,916 `〃` 500,287 `〃` 477,041 `〃` 449,039 `〃` 369,088 `〃` 325,794 1,177,791 5,788,777 29,238 $ 5,759,539

Note: The amount of each item in others does not exceed 5% of the account balance.

Statement of inventories

Item Raw material Semi-finished goods Finished goods	Amount	Amount
	Book Value (note) $ 3,599,873 3,915 9,649,369 $ 13,253,157	Net realizable value
		3,971,762 17,470 12,138,766
		16,127,998

Note: Book value is the net amount of inventories after deduction of provision for inventory valuation and obsolescence loss and loss on inventory write-off.

ARCADYAN TECHNOLOGY CORPORATION

Statement of changes in investment accounted for using equity method

For the year ended December 31, 2025

(Expressed in thousands of TWD)

Beginning balance Name of investee Shares Amount Arcadyan Holding 47,780 $ 2,466,430 Arcadyan USA 1 119,035 Arcadyan Germany 0.5 102,893 Arcadyan Korea 20 36,252 Arcadyan Brazil 965 (52,781) Arcadyan UK 50 6,305 Arcadyan AU 50 84,413 ZHI-BAO 34,980 313,026 TTI 25,028 143,702 CBN 533 7,806 Arcadyan RU - 849 Arcadyan India 19,765 (53,942) Arcadyan Turkey 6,200 59,998 Arcadyan JP - - Total 3,233,986 Add: Credit balance of investment accounted for using equity method 57,000 Add: Recorded as deduction of other receivable-Arcadyan Brazil 49,725 $ 3,340,711	Additions (Note 2) Shares Amount - - - - - - - - - - - - - - - - - - - - - - - - - - 1 2,008 2,008	Decrease (Note 3)	Decrease (Note 3)	Profit or loss of investment	Profit or loss of investment		Other (Note 1) (92,909) 29,651 8,993 (801) (4,131) 211 4,017 (1,742) (77) (70) 178 2,043 (13,251) 5 (67,883)		Ending balance
	Shares - - - - - - - - - - - - - 1	Shares (10,000) - - - - - - - - - - - - -	Amount					Shares 37,780 1 0.5 20 965 50 50 34,980 25,028 533 - 19,765 6,200 1		Amount
			(325,665) - - - - - - - - - - - - - (325,665)		296,600 43,679 10,410 (2,299) 503 741 29,777 (19,445) (5,013) (580) (652) 90,338 6,323 (1) 450,381

Note 1: Other changes include cumulative translation adjustments of $(106,667), changes in long-term investments valued by the equity method not in proportion to shareholding of $(1,950) , and unrealized gross loss from sales of $40,734.

Note 2: The increase is due to the incorporation of the subsidiary on November 25, 2025.

Note 3: The decrease for the current period resulted from the cash capital reduction of $325,665.

ARCADYAN TECHNOLOGY CORPORATION

Statement of changes in property, plant and

equipment

For the year ended December 31, 2025

(Expressed in thousands of TWD)

Please refer to note 6(i) for Property, plant and equipment.

Statement of accounts payable

December 31, 2025

(Expressed in thousands of TWD)

Client Name Accounts payable Corporation A Corporation U Corporation V Others (Note)	Description Amount Non-related parties/operating $ 1,642,471 `〃` 1,010,832 `〃` 614,640 6,034,349 $ 9,302,292

Note: The amount of each item in others does not exceed 5% of the account balance.

ARCADYAN TECHNOLOGY CORPORATION

Statement of other payable

December 31, 2025

(Expressed in thousands of TWD)

Item Bonus payable and employees compensations payable Import and export expense and freight charges payable Others (Note)	Description Amount Estimated year-end bonuses and employees’ compensations for 2025 $ 1,588,920 1,071,601 Service fee, employee benefits provisions , labor health insurance and others 4,806,652 $ 7,467,173

Note: The amount of each item in others does not exceed 5% of the account balance.

Statement of operating revenue

For the year ended December 31, 2025

Item Operating revenue: Smart home solution Mobility solution Broadband solution Others Less: Sales returns and discounts Net operating revenue	Quantity (in thousands) Amount Note $ 17,037,783 `〃` 15,496,844 `〃` 14,444,185 `〃` 1,607,555 (364,829) $ 48,221,538

Note: Due to multi-categories, it’s difficult to count.

ARCADYAN TECHNOLOGY CORPORATION

Statement of operating costs

For the year ended December 31, 2025

(Expressed in thousands of TWD)

Item
Raw materials
Raw materials, beginning of year
Add: Purchases
Less: Raw materials, end of year
Operating expense and others
Raw material used
Processing cost, technical authorization fee and depreciation
Total manufacturing cost
Add: Work in progress, beginning of the year
Less: Work in progress, end of the year
Cost of finished goods
Add: Finished goods, beginning of year
Less: Finished goods, end of year
Operating expense and others
Cost of finished goods sold
Reversal of inventory write-down
Loss on inventory write-off
Operating costs

Amount
$ 3,566,391
34,634,871
(5,320,878)
(32,509)
32,847,875
11,807,704
44,655,579
5,481
(4,996)
44,656,064
6,623,764
(9,740,709)
(198,358)
41,340,761
(68,768)
56,384
$
41,328,377

ARCADYAN TECHNOLOGY CORPORATION

Statement of selling, administrative, research and

development expenses

For the year ended December 31, 2025

(Expressed in thousands of TWD)

Item Salaries Import and export fees Service fee Sample expense Royalty Test fees Others (Note) Total	Selling expenses $ 196,700 103,912 66,224 47,608 1,583 684 119,568 $ 536,279	Administrative expenses 334,452 8,338 137,942 - 2,826 - 193,539 677,097	Research and development expenses
			1,434,369 4,131 253,780 846 488,876 195,932 544,046
			2,921,980

Note: The amount of each item in others does not exceed 5% of the account balance.

AI assistant

Arcadyan — Audit Report / Information 2025

52352_rns_2026-04-29_d73a2e9f-fe87-48f1-abd4-ddb89d00ff3d.pdf

ARCADYAN TECHNOLOGY CORPORATION

Table of contents

Independent Auditors’ Report

Basis for Opinion

Key Audit Matters

1. Inventory valuation

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

Auditors’ Responsibilities for the Audit of the Financial Statements

KPMG

Notes to Readers

(English Translation of Financial Statements Originally Issued in Chinese) ARCADYAN TECHNOLOGY CORPORATION

Balance Sheets

December 31, 2025 and 2024

(Expressed in thousand dollars of TWD)

(English Translation of Financial Statements Originally Issued in Chinese) ARCADYAN TECHNOLOGY CORPORATION

Statements of Comprehensive Income

For the years ended December 31, 2025 and 2024

(Expressed in thousand dollars of TWD)

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese) ARCADYAN TECHNOLOGY CORPORATION

Statements of Changes in Equity

For the years ended December 31, 2025 and 2024

(English Translation of Financial Statements Originally Issued in Chinese) ARCADYAN TECHNOLOGY CORPORATION

Statements of Cash Flows

For the years ended December 31, 2025 and 2024

(Expressed in thousand dollars of TWD)

(English Translation of Financial Statements Originally Issued in Chinese) ARCADYAN TECHNOLOGY CORPORATION

Notes to the Financial Statements

For the years ended December 31, 2025 and 2024

(1) Company history

(2) Approval date and procedures of the financial statements:

(3) New standards, amendments and interpretations adopted:

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(c) The impact of IFRS Accounting Standards issued by IASB but not yet endorsed by the FSC

Effective date per IASB

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(4) Summary of material policies:

(a) Statement of compliance

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(c) Foreign currencies

(ii) Foreign operations

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

3) Fair value through profit or loss (FVTPL)

4) Impairment of financial assets

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

5) Derecognition of financial assets

1) Classification of debt or equity

2) Equity transaction

3) Financial liabilities

4) Derecognition of financial liabilities

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

Cash flow hedges

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(g) Inventories

(h) Investment in associates

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(i)

Investments in subsidiaries

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(k) Lease

(i) As a lessee

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(ii) Subsequent expenditure

(iii) Amortization

(m) Impairment of non-financial assets

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(n) Provisions

(o) Revenue from contracts with customers

(i) Sale of goods

(ii) Rendering of services

ARCADYAN TECHNOLOGY CORPORATION Notes to the Financial Statements

(p) Employee benefits

(i) Defined contribution plans

(ii) Defined benefit plans

Arcadyan Audit Report / Information 2025