ASCENT - Annual Report 2023 | FinancialReports.eu

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Financial Statements and Independent Auditors’ Report 2023 and 2022 Stock code: 1439

Company Address: 19F, No. 557-1, Sec. 4, Zhongxiao E. Rd., Xinyi Dist., Taipei City, Taiwan

Tel. (02)2756-6777

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ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Financial Statements and Independent Auditors’ Report of 2023 and 2022

		Table of Contents
		Items	Page
I.	Cover	page	1
II.	Table	of Contents	2~3
III.	Declaration		4
IV.	Independent Auditors’ Report		5~10
V.	Consolidated Balance Sheet		11~12
VI.	Consolidated Statement of Comprehensive Income		13~14
VII.	Consolidated Statement of Changes in Equity		15
VIII.	Consolidated Statement of Cash Flows		16~17
IX.	Notes	to Consolidated Financial Statements	18~66
	(I)	Company history	18
	(II)	Dates and procedures for approval of financial reports	18
	(III)	Application of new and revised standards and	18~19
		interpretations
	(IV)	Summary of Significant Accounting Policies	19~32
	(V)	Major sources of uncertainty in major accounting	32
		judgments, estimates and assumptions
	(VI)	Explanation of important accounting items	32~52
	(VII)	Related party transactions	53~56
	(VIII)	Assets collateralized (pledged)	57

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	Items	Page
(IX)	Significant contingent liabilities or unrecognized	57
	contractual commitments
(X)	Losses from major disasters	57
(XI)	Material events after the reporting period	57
(XII)	Others	57~65
(XIII)	Other disclosures	65
(XIV)	Information on operating segment	65~66

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Ascent Development Co., Ltd.

Declaration of Consolidated Financial Statements of Affiliates

In 2023 (from January 1, 2023 to December 31, 2023), the companies that should be included in the consolidated financial reports of affiliated companies based on “Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises” and the companies that should be included in the consolidated financial reports of subsidiaries based on the International Financial Reporting Standards 10. The related information that should be disclosed in the consolidated financial statements of affiliated companies are also already disclosed in the consolidated financial reports for subsidiaries, so that the consolidated financial statements of affiliated companies would not be published separately.

Hereby certify

Company Name: ASCENT DEVELOPMENT CO., LTD.

Person in-charge: Chia-Chi Hou

March 13, 2024

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Independent Auditors’ Report

(2024) Cai-Shen-Bao-Zi No. 23003724

To ASCENT DEVELOPMENT CO., LTD.:

Audit Opinions

ASCENT DEVELOPMENT CO., LTD. (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) and its subsidiaries (the Group) balance sheet of December 31 of 2023 and 2022, the comprehensive income statement, changes of equity, and cash flow statement from January 1 to December 31 of 2022 and 2021 and the notes to the consolidated financial statements (including the summary of major accounting policies) have been audited by the Auditor of the Firm.

According to the opinions of the Auditor, the above-mentioned consolidated financial statements are prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers in all material aspects, which are sufficient to express the financial status of the Group on December 31, 2023 and 2022, and parent company only financial performance and parent company only cash flow from January 1 to December 31 in 2023 and 2022.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and auditing standards. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group and its subsidiaries in accordance with the Professional Ethics for Certified Public Accountant of the Republic of China and we have fulfilled our other ethical responsibilities in accordance with these requirements. Based on the audit results of the Auditor and the audit reports of other auditors, we believe that we have obtained sufficient and appropriate audit evidence as the basis for expressing the audit opinion.

Key Audit Matters

Key audit items refer to the most important items in the audit of the Company's 2023 consolidated financial statements based on our professional judgment. These matters have been dealt with in the process of checking the consolidated financial statements and reaching audit opinions, and the we do not express opinions on these matters independently.

Key audit matters in the Group's consolidated financial statements for the year ended

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December 31, 2023 are as follows:

Impairment Testing of Investment Using the Equity Method

Descriptions

For the accounting policy of investment using the equity method, please refer to Note 4(15) of the consolidated financial statements, for the accounting policy of impairment of non-financial assets, please refer to Note 4(20) of the consolidated financial statements, and for the description of accounting items, please refer to the Notes 6(8) of the consolidated financial statements.

On December 31, 2023, the book value of the Group's investment using the equity method was NT$1,155,041 thousands, accounting for 22% of the total consolidated assets. In accordance with the International Accounting Standard No. 28 “Investment in Affiliated Enterprises and Joint Ventures”, the management level shall assess whether the recoverable amount of the investment is lower than the book value if there is objective evidence showing signs of impairment for the investment using the equity method. Since the objective evidence of its impairment assessment and the comprehensive consideration factors for determining the recoverable amount involve the subjective judgment of the management and have a high degree of uncertainty, and the investment amount using the equity method is significant, the auditor adopts the Group’s relevant Impairment assessment of equity method investments is listed as one of the most important matters of the audit.

Audit procedure

The auditor has implemented the following procedures to respond to the specific aspects described in the above key audit items:

Interview with the management level to understand the management's assessment of the signs of impairment of investments using the equity method and evaluate its rationality.
To obtain the equity value evaluation report issued by the external evaluation experts appointed by the management, the procedures performed by the auditor are as follows:
(1) Assess the suitability and objectivity of the external evaluation experts appointed by the management level.
(2) Assess the appropriateness of the evaluation methods adopted by the external evaluation experts appointed by the management level and the rationality of the relevant assumptions.

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Appropriateness of the Vesting Period of Real Estate Sales Revenue

Descriptions

Please refer to Note 4(27) of the consolidated financial statements for the accounting policy of operating revenue in the construction industry, and Note 6(19) to the consolidated financial statements for descriptions of accounting items.

The real estate sales revenue of the construction industry is recognized when the ownership transfer of the real estate is completed and the house inspection certificate is delivered to the customer. Due to the wide market range of real estate sales in the construction industry, it is necessary to review the ownership transfer and other information one by one before recognizing the sales revenue. Usually, a lot of manual works would be required to determine the correctness of the recognition time of the sales revenue. The appropriateness of the vesting period is listed as one of the most important matters in the audit.

Audit procedure

The auditor has implemented the following procedures to respond to the specific aspects described in the above key audit items:

Interview with management to understand and review the procedures for recognizing real estate sales revenue and adopt it consistently during the financial statement comparison period.
Assess and verify the appropriateness of the attribution period of real estate sales income for a certain period before and after the deadline at the end of the period, including checking the land and building ownership transfer information and relevant dates to support the correctness of the recognition time of real estate sales revenue.

Other Matters - Audits Conducted by Other Certified Public Accountants

The financial statements of some of the Company's investments under the equity method of the Group have not been audited by us but by other independent auditors. Therefore, in our opinions on the above-mentioned consolidated financial statements, the amount listed in the financial statements of the Companies and the relevant information disclosed in Note 13 are based on the audit reports of other auditors. On December 31, 2023 and 2022, the amount of investment in the above-mentioned companies using the equity method was NT$1,105,298 thousands and NT$939,639 thousands, respectively, accounting for 21% and 20% of the total consolidated assets. In 2023 and 2022 the consolidated profits and losses recognized for the aforementioned companies were NT$308,546 thousands and NT$102,193 thousands, respectively, accounting for 94% and

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270% of the consolidated profits and losses for the current period.

Other Matters - Parent Company Only Financial Statements

ASCENT DEVELOPMENT CO., LTD. has compiled the parent company only financial statements for 2023, and the audit report of other matter paragraphs issued by the accountant with unqualified opinions is submitted for reference.

Responsibilities of Management Level and Governance Units for the Consolidated Financial Statements

The responsibilities of the management is to prepare consolidated financial statements that are reasonably expressed in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards approved and published by the Financial Supervisory Commission and International Accounting Standards, and interpret and explain the announcement in preparation of consolidated financial statements that are fairly presented, and maintain the necessary internal controls related to the preparation of consolidated financial statements to ensure that there are no material misstatement in the financial statements that are caused by fraud or errors.

When preparing the consolidated financial statements, the responsibilities of the management level also include assessing the ability of the Group for going concern, the disclosure of related matters, and the adoption of the going-concern accounting basis, unless the management level intends to liquidate the Group or cease operations, or except for liquidation or cease of operation or has no realistic alternative but to do so.

The governance units (including the audit committee) of the Group are responsible for supervising the financial reporting process.

Responsibilities of Auditor to Audit Consolidated Financial Statements

The purpose of our audit of the financial statements is to obtain reasonable assurance as to whether there is any material misrepresentation in the consolidated financial statements as a whole resulting from fraud or error, and to issue an audit report. Reasonable certainty is of high degree of certainty, but there is no guarantee that the audit work performed in accordance with the auditing standards of the Republic of China will be able to detect material misstatement in the consolidated financial statements. Misstatements may result from fraud or error. Misstatements of individual amounts or aggregated amounts is considered material if it can reasonably be expected to affect economic decisions made by users of the consolidated financial statements.

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

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or overriding internal controls.
Obtain an understanding of the internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management level.
Conclude on the appropriateness of management level's use of the going concern basis of accounting and whether or not a material uncertainty exists related to events or conditions that may cast a significant doubt on the Group's and its subsidiaries’ ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as an ongoing concern.
Assess the overall presentation, structure and content of the consolidated financial statements (including relevant notes), and whether the financial statements properly represent relevant transactions and events.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

The planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal controls that we identify during our audit.

We also provide the governance units with the statements that the personnel of the accounting firm that is subject to independence regulations have complied with the independence statement in the professional ethics code for CPAs of the Republic of China, and communicate with the governance units all relationships that may be considered to affect the independence of the auditors and other matters (including relevant

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protective measures).

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Group's consolidated financial statements for the year 2023, and are therefore the key audit matters. We describe these matters in our auditor’s 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.

PwC Taiwan

Chun-Yuan Hsiao

Accountant

Se-Kai Lin

Former Securities and Futures Bureau, Financial Supervisory Commission

Approval No.: Jin-Guan-Zheng-Liu-Zi No. 0960042326 Jin-Guan-Zheng-Liu-Zi No. 0960072936

March 13, 2024

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ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Balance Sheet December 31, 2023 and 2022

	Expressed in thousands of NT$ December 31, 2023 December 31, 2022 Amount % Amount % $ 605,103 12 $ 521,760 11 31,625 1 - - 20,000 - 80,000 2 27,668 1 19,613 - 7,114 - 6,062 - 377 - 377 - 9,548 - 24,346 1 110 - - - 2,172,050 41 2,067,819 43 7,040 - 3,319 - 69,961 1 96 - 50,347 1 18,475 - 3,000,943 57 2,741,867 57 86,000 2 86,000 2 170,784 3 148,906 3 1,155,041 22 939,639 20 142 - 167 - 950 - 103 - 865,808 16 887,049 18 343 - 338 - 10,143 - 10,139 - 13,000 - 4,766 - 3,790 - 3,790 - 2,306,001 43 2,080,897 43 $ 5,306,944 100 $ 4,822,764 100
Assets Notes	December 31, 2023
	Amount %
Current assets
1100 Cash and cash equivalents VI(I)	$ 605,103 12
1110 Financial assets at fair value through profit or loss - current VI(VI)(XXII)	31,625 1
1136 Financial assets at amortized cost- Current VI(II)	20,000 -
1150 Notes receivable, net VI(III)	27,668 1
1170 Accounts receivable, net VI(III)	7,114 -
1180 Accounts receivable - related parties, net VII	377 -
1200 Other receivables	9,548 -
1220 Current income tax assets	110 -
130X Inventory VI(IV)(V), VII and VIII	2,172,050 41
1410 Prepayments	7,040 -
1476 Other financial assets - current VIII	69,961 1
1479 Other current assets-others	50,347 1
11XX Total current assets	3,000,943 57
Non-current assets
1510 Financial assets at FVTPL - non-current VI(VI)	86,000 2
1517 Financial assets at FVTOCI - non-current VI(VII)	170,784 3
1550 Investments accounted for using equity method VI(VIII)	1,155,041 22
1600 Property, plants, and equipment	142 -
1755 Right-of-use assets VI(IX)	950 -
1760 Investment property, net VI(X) and VIII	865,808 16
1840 Deferred income tax assets	343 -
1920 Deposits received VII	10,143 -
1980 Other financial assets - non-current VIII	13,000 -
1990 Other non-current assets - others	3,790 -
15XX Total non-current assets	2,306,001 43
1XXX Total assets	$ 5,306,944 100

(Continued on next page)

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ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Balance Sheet

December 31, 2023 and 2022

	Expressed in thousands of NT$ December 31, 2023 December 31, 2022 Amount % Amount % $ 1,362,801 26 $ 1,318,925 28 - - 28,762 1 185,318 4 31,698 1 43,792 1 12,066 - 18,328 - 15,032 - 9,769 - 9,769 - 37,645 1 29,914 1 3,553 - 14,180 - 2,696 - 2,301 - 16,000 - 16,000 - 6,096 - 6,958 - 1,685,998 32 1,485,605 31 374,000 7 390,000 8 507 - 511 - 122,964 2 124,702 3 8,697 - 6,942 - 506,168 9 522,155 11 2,192,166 41 2,007,760 42 920,000 17 920,000 19 182,854 3 182,854 3 364,347 7 357,010 8 212,044 4 7,856 - 955,140 18 1,009,210 21 ( 72,606) ( 1) ( 204,188) ( 4) 2,561,779 48 2,272,742 47 552,999 11 542,262 11 3,114,778 59 2,815,004 58 $ 5,306,944 100 $ 4,822,764 100	Expressed in thousands of NT$ December 31, 2023 December 31, 2022 Amount % Amount % $ 1,362,801 26 $ 1,318,925 28 - - 28,762 1 185,318 4 31,698 1 43,792 1 12,066 - 18,328 - 15,032 - 9,769 - 9,769 - 37,645 1 29,914 1 3,553 - 14,180 - 2,696 - 2,301 - 16,000 - 16,000 - 6,096 - 6,958 - 1,685,998 32 1,485,605 31 374,000 7 390,000 8 507 - 511 - 122,964 2 124,702 3 8,697 - 6,942 - 506,168 9 522,155 11 2,192,166 41 2,007,760 42 920,000 17 920,000 19 182,854 3 182,854 3 364,347 7 357,010 8 212,044 4 7,856 - 955,140 18 1,009,210 21 ( 72,606) ( 1) ( 204,188) ( 4) 2,561,779 48 2,272,742 47 552,999 11 542,262 11 3,114,778 59 2,815,004 58 $ 5,306,944 100 $ 4,822,764 100	Expressed in thousands of NT$ December 31, 2023 December 31, 2022 Amount % Amount % $ 1,362,801 26 $ 1,318,925 28 - - 28,762 1 185,318 4 31,698 1 43,792 1 12,066 - 18,328 - 15,032 - 9,769 - 9,769 - 37,645 1 29,914 1 3,553 - 14,180 - 2,696 - 2,301 - 16,000 - 16,000 - 6,096 - 6,958 - 1,685,998 32 1,485,605 31 374,000 7 390,000 8 507 - 511 - 122,964 2 124,702 3 8,697 - 6,942 - 506,168 9 522,155 11 2,192,166 41 2,007,760 42 920,000 17 920,000 19 182,854 3 182,854 3 364,347 7 357,010 8 212,044 4 7,856 - 955,140 18 1,009,210 21 ( 72,606) ( 1) ( 204,188) ( 4) 2,561,779 48 2,272,742 47 552,999 11 542,262 11 3,114,778 59 2,815,004 58 $ 5,306,944 100 $ 4,822,764 100	Expressed in thousands of NT$ December 31, 2023 December 31, 2022 Amount % Amount % $ 1,362,801 26 $ 1,318,925 28 - - 28,762 1 185,318 4 31,698 1 43,792 1 12,066 - 18,328 - 15,032 - 9,769 - 9,769 - 37,645 1 29,914 1 3,553 - 14,180 - 2,696 - 2,301 - 16,000 - 16,000 - 6,096 - 6,958 - 1,685,998 32 1,485,605 31 374,000 7 390,000 8 507 - 511 - 122,964 2 124,702 3 8,697 - 6,942 - 506,168 9 522,155 11 2,192,166 41 2,007,760 42 920,000 17 920,000 19 182,854 3 182,854 3 364,347 7 357,010 8 212,044 4 7,856 - 955,140 18 1,009,210 21 ( 72,606) ( 1) ( 204,188) ( 4) 2,561,779 48 2,272,742 47 552,999 11 542,262 11 3,114,778 59 2,815,004 58 $ 5,306,944 100 $ 4,822,764 100
Liabilities and equity Notes	December 31, 2023		December 31, 2022
	Amount	%	Amount	%
Current liabilities
2100 Short-term borrowings VI(V)(XI)	$ 1,362,801	26	$ 1,318,925	28
2110 Short-term notes payable VI(V)(XII)	-	-	28,762	1
2130 Contract liabilities - current VI(XIX)	185,318	4	31,698	1
2150 Notes payable	43,792	1	12,066	-
2170 Accounts payable	18,328	-	15,032	-
2180 Accounts payable - related parties VII	9,769 -


2200 Other payables	37,645	1	29,914	1
2230 Current income tax liabilities	3,553	-	14,180	-
2280 Lease liabilities - current	2,696	-	2,301	-
2320 Long-term liabilities due within one year or one business cycle VI(XIII)	16,000 -


2399 Other current liabilities - others	6,096 -

21XX Total of current liabilities	1,685,998	32	1,485,605	31
Non-current liabilities
2540 Long-term borrowings VI(XIII)	374,000	7	390,000	8
2570 Deferred income tax liabilities	507	-	511	-
2580 Lease liabilities - non-current	122,964	2	124,702	3
2600 Other non-current liabilities	8,697	-	6,942	-
25XX Total non-current liabilities	506,168 9

2XXX Total liabilities	2,192,166	41	2,007,760	42
Equity attributable to owners
of parent company
Share capital VI(XV)
3110 Common stock capital	920,000	17	920,000	19
Capital surplus VI(XVI)
3200 Capital surplus	182,854	3	182,854	3
Retained earnings VI(XVII)
3310 Legal reserve	364,347	7	357,010	8
3320 Special reserves	212,044	4	7,856	-
3350 Undistributed earnings	955,140	18	1,009,210	21
Other equity VI(XVIII)
3400 Other equity	( 72,606)	( 1)	( 204,188)	( 4)
31XX Total equity attributable to owners of the parent company	2,561,779 48		2,272,742 47

36XX Non-controlling interests	552,999	11	542,262	11
3XXX Total equity	3,114,778	59	2,815,004	58
Significant contingent liabilities
and unrecognized contractual commitments IX

Subsequent events XI
3X2X Total liabilities and equity	$ 5,306,944	100	$ 4,822,764	100

The attached notes to the consolidated financial statements form part of the consolidated financial statements. Please refer to them also.

Chairman: Chia-Chi Hou

Managerial Officer: Hsien-Wen Liu Accounting Officer: Chien-Chang Luo

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ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Statement of Comprehensive Income January 1 to December 31, 2023 and 2022

			Expressed in thousands of NT$ (Except for earnings per share in NT$) 2023 2022 Amount % Amount % $ 199,191 100 $ 570,153 100 ( 144,009) ( 73) ( 446,013) ( 78) 55,182 27 124,140 22 ( 11,326) ( 6) ( 32,469) ( 6) ( 56,951) ( 28) ( 50,820) ( 9) ( 68,277) ( 34) ( 83,289) ( 15) ( 13,095) ( 7) 40,851 7 5,748 3 3,738 1 8,320 4 11,001 2 ( 1,482) - ( 48,508) ( 9) ( 13,467) ( 7) ( 11,664) ( 2) 213,271 107 166,618 29 212,390 107 121,185 21 199,295 100 162,036 28 ( 4,156) ( 2) ( 18,444) ( 3) $ 195,139 98 $ 143,592 25	Expressed in thousands of NT$ (Except for earnings per share in NT$) 2023 2022 Amount % Amount % $ 199,191 100 $ 570,153 100 ( 144,009) ( 73) ( 446,013) ( 78) 55,182 27 124,140 22 ( 11,326) ( 6) ( 32,469) ( 6) ( 56,951) ( 28) ( 50,820) ( 9) ( 68,277) ( 34) ( 83,289) ( 15) ( 13,095) ( 7) 40,851 7 5,748 3 3,738 1 8,320 4 11,001 2 ( 1,482) - ( 48,508) ( 9) ( 13,467) ( 7) ( 11,664) ( 2) 213,271 107 166,618 29 212,390 107 121,185 21 199,295 100 162,036 28 ( 4,156) ( 2) ( 18,444) ( 3) $ 195,139 98 $ 143,592 25	Expressed in thousands of NT$ (Except for earnings per share in NT$) 2023 2022 Amount % Amount % $ 199,191 100 $ 570,153 100 ( 144,009) ( 73) ( 446,013) ( 78) 55,182 27 124,140 22 ( 11,326) ( 6) ( 32,469) ( 6) ( 56,951) ( 28) ( 50,820) ( 9) ( 68,277) ( 34) ( 83,289) ( 15) ( 13,095) ( 7) 40,851 7 5,748 3 3,738 1 8,320 4 11,001 2 ( 1,482) - ( 48,508) ( 9) ( 13,467) ( 7) ( 11,664) ( 2) 213,271 107 166,618 29 212,390 107 121,185 21 199,295 100 162,036 28 ( 4,156) ( 2) ( 18,444) ( 3) $ 195,139 98 $ 143,592 25	Expressed in thousands of NT$ (Except for earnings per share in NT$) 2023 2022 Amount % Amount % $ 199,191 100 $ 570,153 100 ( 144,009) ( 73) ( 446,013) ( 78) 55,182 27 124,140 22 ( 11,326) ( 6) ( 32,469) ( 6) ( 56,951) ( 28) ( 50,820) ( 9) ( 68,277) ( 34) ( 83,289) ( 15) ( 13,095) ( 7) 40,851 7 5,748 3 3,738 1 8,320 4 11,001 2 ( 1,482) - ( 48,508) ( 9) ( 13,467) ( 7) ( 11,664) ( 2) 213,271 107 166,618 29 212,390 107 121,185 21 199,295 100 162,036 28 ( 4,156) ( 2) ( 18,444) ( 3) $ 195,139 98 $ 143,592 25
			2023		2022
	Items	Notes	Amount	%	Amount	%
4000	Revenue	VI(V)(XIX)	$ 199,191	100	$ 570,153	100
5000	Operating Costs	VI(IV)(V)
		(XXIV)	( 144,009)	( 73)	( 446,013)	( 78)
5900	Gross profit		55,182	27	124,140	22
	Operating expenses	VI(V)(XXIV)
		(XXV) and VII
6100	Promotional expenses		( 11,326)	( 6)	( 32,469)	( 6)
6200	Administrative expenses		( 56,951)	( 28)	( 50,820)	( 9)
	Total operating
			( 68,277)	( 34)	( 83,289)	( 15)
6900	Operating profit (loss)		( 13,095)	( 7)	40,851	7
	Non-operating income and

7100	Interest income	VI(XX) and VII	5,748	3	3,738	1
7010	Other income	VI(XXI)	8,320	4	11,001	2
7020	Other gains and losses	VI(XXII)	( 1,482)	-	( 48,508)	( 9)
7050	Financial cost	VI(XXIII)	( 13,467)	( 7)	( 11,664)	( 2)
7060	Profit and loss share of the	VI(VIII)
			213,271	107	166,618	29
	Total non-operating
			212,390	107	121,185	21
7900	Income before tax		199,295	100	162,036	28
7950	Income tax expenses	VI(XXVI)	( 4,156)	( 2)	( 18,444)	( 3)
8200	Current period net profit		$ 195,139	98	$ 143,592	25

(Continued on next page)

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ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Statement of Comprehensive Income January 1 to December 31, 2023 and 2022

			Expressed in thousands of NT$ (Except for earnings per share in NT$) 2023 2022 Amount % Amount % $ 41,081 20 ($ 41,365) ( 7) 91,154 46 ( 64,426) ( 11) 132,235 66 ( 105,791) ( 18) $ 132,235 66 ($ 105,791) ( 18) $ 327,374 164 $ 37,801 7 $ 184,402 93 $ 92,205 16 - - 13,190 2 10,737 5 38,197 7 $ 195,139 98 $ 143,592 25 $ 316,637 159 ($ 13,586) ( 2) - - 13,190 2 10,737 5 38,197 7 $ 327,374 164 $ 37,801 7 $ 2.00 $ 1.00 - 0.14 $ 2.00 $ 1.14 $ 2.00 $ 1.00 - 0.14 $ 2.00 $ 1.14	Expressed in thousands of NT$ (Except for earnings per share in NT$) 2023 2022 Amount % Amount % $ 41,081 20 ($ 41,365) ( 7) 91,154 46 ( 64,426) ( 11) 132,235 66 ( 105,791) ( 18) $ 132,235 66 ($ 105,791) ( 18) $ 327,374 164 $ 37,801 7 $ 184,402 93 $ 92,205 16 - - 13,190 2 10,737 5 38,197 7 $ 195,139 98 $ 143,592 25 $ 316,637 159 ($ 13,586) ( 2) - - 13,190 2 10,737 5 38,197 7 $ 327,374 164 $ 37,801 7 $ 2.00 $ 1.00 - 0.14 $ 2.00 $ 1.14 $ 2.00 $ 1.00 - 0.14 $ 2.00 $ 1.14	Expressed in thousands of NT$ (Except for earnings per share in NT$) 2023 2022 Amount % Amount % $ 41,081 20 ($ 41,365) ( 7) 91,154 46 ( 64,426) ( 11) 132,235 66 ( 105,791) ( 18) $ 132,235 66 ($ 105,791) ( 18) $ 327,374 164 $ 37,801 7 $ 184,402 93 $ 92,205 16 - - 13,190 2 10,737 5 38,197 7 $ 195,139 98 $ 143,592 25 $ 316,637 159 ($ 13,586) ( 2) - - 13,190 2 10,737 5 38,197 7 $ 327,374 164 $ 37,801 7 $ 2.00 $ 1.00 - 0.14 $ 2.00 $ 1.14 $ 2.00 $ 1.00 - 0.14 $ 2.00 $ 1.14	Expressed in thousands of NT$ (Except for earnings per share in NT$) 2023 2022 Amount % Amount % $ 41,081 20 ($ 41,365) ( 7) 91,154 46 ( 64,426) ( 11) 132,235 66 ( 105,791) ( 18) $ 132,235 66 ($ 105,791) ( 18) $ 327,374 164 $ 37,801 7 $ 184,402 93 $ 92,205 16 - - 13,190 2 10,737 5 38,197 7 $ 195,139 98 $ 143,592 25 $ 316,637 159 ($ 13,586) ( 2) - - 13,190 2 10,737 5 38,197 7 $ 327,374 164 $ 37,801 7 $ 2.00 $ 1.00 - 0.14 $ 2.00 $ 1.14 $ 2.00 $ 1.00 - 0.14 $ 2.00 $ 1.14
			2023		2022
		Notes	Amount	%	Amount	%
	Other comprehensive income
		VI(XVIII)


	Items not reclassified to profit

8316	Unrealized gains or losses on	VI(VII)	$ 41,081 20

					($ 41,365)	( 7)
8320	Shareholding in other	VI(VIII)	91,154 46

					( 64,426)	( 11)
	Total of items not
					( 105,791)	( 18)
	Other comprehensive income
					($ 105,791)	( 18)
	Total comprehensive income
					$ 37,801	7
	Net profit (loss) attributable to:
8610	Owner of parent company		$ 184,402	93	$ 92,205	16
	Equity owned by the previous
					13,190	2


8620	Non-controlling interests		10,737	5	38,197	7
	Total		$ 195,139	98	$ 143,592	25
	Total comprehensive income

8710	Owner of parent company		$ 316,637	159	($ 13,586)	( 2)
	Equity owned by the previous
					13,190	2


8720	Non-controlling interests		10,737	5	38,197	7
	Total		$ 327,374	164	$ 37,801	7

	Basic earnings per share	VI(XXVII)
9710	Owner of parent company		$	2.00	$	1.00
	Equity owned by the previous
						0.14


9750	Basic earnings per share		$	2.00	$	1.14
	Diluted earnings per share	VI(XXVII)
9810	Owner of parent company		$	2.00	$	1.00
	Equity owned by the previous
						0.14


9850	Diluted earnings per share		$	2.00	$	1.14

The attached notes to the consolidated financial statements form part of the consolidated financial statements. Please refer to them also.

Chairman: Chia-Chi Hou Managerial Officer: Hsien-Wen Liu Accounting Officer: Chien-Chang Luo

~14~

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Statement of Changes in Equity January 1 to December 31, 2023 and 2022

Expressed in thousands of NT$

			Equity attributa	ble to owners of parent company	ble to owners of parent company
				Retained earnings
Notes	Common stock capital	Capital surplus	Legal reserve	Special reserves	Undistributed earnings	Unrealized valuation gains and losses of financial assets	Total	Equity owned by the previous holder under the joint control	Non-controlling interests	Total equity
						measured at
						fair value through other comprehensive income

2022
Balance at January1,2022	$ 920,000	$ 145,021	$ 341,774	$ 7,856	$ 969,473	($ 117,229)	$2,266,895	$ 347,601	$ 705,735	$ 3,320,231
Current period net profit	-	-	-	-	92,205	-	92,205	13,190	38,197	143,592
Other comprehensive income of current period VI(XVIII)	-	-	-	-	696	( 106,487)	( 105,791)	-	-	( 105,791)
Total comprehensive income of the current
period	-	-	-	-	92,901	( 106,487)	( 13,586)	13,190	38,197	37,801
Appropriation and distribution of earnings VI(XVII)
Appropriation of legal reserve	-	-	15,236	-	( 15,236)	-	-	-	-	-
Cash dividends	-	-	-	-	( 18,400)	-	( 18,400)	-	-	( 18,400)
Capital reduction in cash	-	-	-	-	-	-	-	( 99,330)	( 201,670)	( 301,000)
Disposal of equity instruments at FVTOCI VI(VII)(XVIII)	-	-	-	-	76	( 76)	-	-	-	-
Disposal of equity instruments at FVTOCI by VI(XVIII)
affiliates	-	-	-	-	( 19,604)	19,604	-	-	-	-
Changes in the net equity value of affiliates recognized under the equity method VI(VIII)	-	7,372	-	-	-	-	7,372	-	-	7,372
Impact of organizational reorganization VI(XXVIII)	-	30,461	-	-	-	-	30,461	( 261,461)	-	( 231,000)
Balance atDecember31,2022	$ 920,000	$ 182,854	$ 357,010	$ 7,856	$1,009,210	($ 204,188)	$2,272,742	$ -	$ 542,262	$2,815,004
2023
Balance at January 1, 2023	$ 920,000	$ 182,854	$ 357,010	$ 7,856	$1,009,210	($ 204,188)	$ 2,272,742	$ -	$ 542,262	$ 2,815,004
Current period net profit	-	-	-	-	184,402	-	184,402	-	10,737	195,139
Other comprehensive income of current period VI(XVIII)	-	-	-	-	-	132,235	132,235	-	-	132,235
Total comprehensive income of the current
period	-	-	-	-	184,402	132,235	316,637	-	10,737	327,374
Appropriation and distribution of earnings: VI(XVII)
Appropriation of legal reserve	-	-	7,337	-	( 7,337)	-	-	-	-	-
Special reserve	-	-	-	204,188	( 204,188)	-	-	-	-	-
Cash dividends	-	-	-	-	( 27,600)	-	( 27,600)	-	-	( 27,600)
Disposal of equity instruments at FVTOCI VI(VII)(XVIII)	-	-	-	-	1,170	( 1,170)	-	-	-	-
Disposal of equity instruments at FVTOCI by VI(XVIII)
affiliates	-	-	-	-	( 517)	517	-	-	-	-
Balance at December 31, 2023	$ 920,000	$ 182,854	$ 364,347	$ 212,044	$ 955,140	($ 72,606)	$2,561,779	$ -	$ 552,999	$ 3,114,778

The attached notes to the consolidated financial statements form part of the consolidated financial statements. Please refer to them also.

Chairman: Chia-Chi Hou

Managerial Officer: Hsien-Wen Liu

Accounting Officer: Chien-Chang Luo

~15~

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Statement of Cash Flows January 1 to December 31, 2023 and 2022

	Expressed in thousands of NT$ January 1 to December 31, 2023 January 1 to December 31, 2022 $ 199,295 $ 162,036 21,736 21,663 1,535 - 13,467 11,664 ( 5,748) ( 3,738) ( 3,381) ( 3,354) ( 213,271) ( 166,618 ) - 46,403 ( 33,160) - ( 8,055) ( 2,395) ( 1,052) 4,609 15,327 1,742 ( 104,231) ( 597,962 ) ( 3,721) ( 750) ( 69,865) 2 ( 31,872) 7,461 153,620 ( 28,480) 31,726 10,692 3,296 ( 9,430) 7,527 ( 31,741) - ( 32) ( 862) ( 22,828 ) ( 27,689) ( 601,056) ( 13,296) ( 11,709 ) ( 14,902) ( 6,390) ( 55,887) ( 619,155)
Notes	January 1 to
	December 31, 2023

Cash flow from operating activities
Net income before tax	$ 199,295
Adjustment items
Income and expenses
Depreciation expense VI(IX)(X)(XXIV)	21,736
Losses on financial assets measured at fair value through profit or loss VI(XXII)	1,535
Interest expense VI(XXIII)	13,467
Interest income VI(XX)	( 5,748)
Dividend income VI(VII)(XXI)	( 3,381)
Shareholding in the profit of the affiliates under the equity method VI(VIII)	( 213,271)
Impairment loss VI(XXII)	-
Changes in assets/liabilities related to
operating activities
Net changes in assets related to
operating activities
Financial assets at fair value through profit or loss - current VI(VI)	( 33,160)
Notes receivable	( 8,055)
Accounts receivable	( 1,052)
Other receivables	15,327
Inventory	( 104,231)
Prepayments	( 3,721)
Other financial assets - current	( 69,865)
Other current assets	( 31,872)
Net changes in liabilities related to
operating activities
Contract liabilities	153,620
Notes payable	31,726
Accounts payable	3,296
Other payables	7,527
Other payables - related parties	-
Other current liabilities	( 862)
Cash outflow from operations	( 27,689)
Interest paid	( 13,296)
Income tax paid	( 14,902)
Net cash outflow from operating activities	( 55,887)

(Continued on next page)

~16~

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES

(Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Statement of Cash Flows January 1 to December 31, 2023 and 2022

	Expressed in thousands of NT$ January 1 to December 31, 2023 January 1 to December 31, 2022 $ - ($ 60,000) 60,000 - ( 41,243) ( 65,880) 60,446 34,799 - 180,000 ( 8,234) 32,612 ( 3,467) ( 39 ) 3,463 - 5,294 6,999 92,329 92,385 168,588 220,876 489,996 643,557 ( 446,120) - ( 28,762) ( 113,096 ) ( 2,627) ( 1,619) - 418,000 ( 16,000) ( 430,000) 9,187 ( 217 ) ( 7,432) - ( 27,600) ( 18,400 ) - ( 231,000) - ( 301,000 ) ( 29,358) ( 33,775) 83,343 ( 432,054) 521,760 953,814 $ 605,103 $ 521,760
Notes	January 1 to
	December 31, 2023

Cash flow from investment activities
Acquisition of financial assets at	$ -
amortized cost
Disposal of financial assets measured at	60,000
amortized cost
Acquisition of financial assets at FVTOCI	( 41,243)
Disposal of financial assets at FVTOCI	60,446
Decrease in other receivables – related	-
parties
Decrease (increase) of other financial	( 8,234)
assets - non-current

Increase in refundable deposits	( 3,467)
Decrease in refundable deposits	3,463
Interest collected	5,294
Dividends received	92,329
Net cash inflow from investing activities	168,588
Cash flow from financing activities
Short-term borrowings VI(XXIX)	489,996
Repayment of short-term borrowings VI(XXIX)	( 446,120)
Decrease in short-term notes payable VI(XXIX)	( 28,762)
Lease principal repayment VI(XXIX)	( 2,627)
Long-term borrowings VI(XXIX)	-
Repayment of long-term borrowings VI(XXIX)	( 16,000)
Increase in guarantee deposits received VI(XXIX)	9,187
Decrease in guarantee deposits received VI(XXIX)	( 7,432)
Distribution of cash dividends VI(XVII)	( 27,600)
Cash paid for organizational restructuring VI(XXVIII)	-
Capital reduction in cash
	-
Net cash outflow from financing	( 29,358)
Increase (decrease) in cash and cash	83,343
equivalents for the period
Cash and cash equivalents	521,760
Cash and equivalent cash balance at the	$ 605,103
beginning of the period

The attached notes to the consolidated financial statements form part of the consolidated financial statements. Please refer to them also.

Chairman: Chia-Chi Hou Managerial Officer: Hsien-Wen Liu Accounting Officer: Chien-Chang Luo

~17~

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Notes to Consolidated Financial Statements 2023 and 2022

Expressed in thousands of NT$

(unless otherwise stated)

I. History

(I) ASCENT DEVELOPMENT CO., LTD. (hereinafter referred to as “the Company”), formerly CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD. was established on August 19, 1964 in accordance with the Company Act. On June 23, 2022, the resolution of the shareholders' meeting approved the change of name. The main business of the Company and its subsidiaries (hereinafter referred to as “the Group”) is sales of wool tops, carbonized wool, scoured wool, shrink-resistant wool tops and real estate development, lease and sale, etc. The Company's stock has been listed on the Taiwan Stock Exchange since May 22, 1989.
(II) Hanyang Global Co., Ltd. holds 53.41% equity of the Company, and Hanshin Asset Management Co., Ltd. is the ultimate parent company of the Group.

II. Dates and procedures for approval of financial reports

The financial statements are approved and issued by the board of directors on March 13, 2024.

III. Application of new and revised standards and interpretations

(I) The impact of the newly released and revised International Financial Reporting Standards (“IFRSs”) that have been approved and issued by the Financial Supervisory Commission (FSC)

The following table summarizes the newly issued, revised and revised standards and interpretations of the International Financial Reporting Standards (IFRSs) applicable in 2023 that were recognized and issued by the FSC:

	Effective date of
Application of new/corrected/revised standards and	IASB's
interpretations	announcement
Amendments to IAS 1 “Disclosure of Accounting
Policies”	January 1, 2023
Amendments to IAS 8 “Definition of Accounting
Estimates”	January 1, 2023
Amendments to IAS 12 regarding “Deferred Tax related	January 1, 2023
to Assets and Liabilities arising from a Single
Transaction”
Amendments to IAS 12 “International Tax Reform —	May 23, 2023
Pillar Two Model Rules”

The Group has assessed that the above standards and interpretations have no material impact on the Group's financial position and financial performance.

~18~

(II) The impact of the newly released and revised International Financial Reporting Standards that have not yet been adopted by the FSC

The following table summarizes the newly issued, corrected and revised standards and interpretations of the International Financial Reporting Standards applicable in 2024 that were recognized and issued by the FSC:

Application of new/corrected/revised standards and	Effective date of IASB's
interpretations	announcement
Amendments to IFRS 16 “Lease Liability in a Sale and
Leaseback”	January 1, 2024
Amendments to IAS 1 “Classification of Liabilities as Current	January 1, 2024
or Non-current”
Amendments to IAS 1 “Non-current Liabilities with Covenants”	January 1, 2024
Amendments to IAS 7 and IFRS 7 “Supplier Finance	January 1, 2024
Arrangements”

The Group has assessed that the above standards and interpretations have no material impact on the Group's financial position and financial performance.

(III) Impacts of IFRSs issued by the IASB but not yet endorsed by the FSC

The following table summarizes the newly released, amended, and revised standards and interpretations of the IFRSs issued by the IASB but not yet recognized by the FSC:

standards and interpretations of the IFRSs issued by the recognized by the FSC:	IASB but not yet
Application of new/corrected/revised standards and	Effective date of IASB's
interpretations	announcement
Amendments to IFRS 10 and IAS 28 “Sale or Contribution of
Assets between an Investor and its Associate or Joint
Venture”	To be decided by IASB
IFRS 17 “Insurance Contracts”	January 1, 2023
Amendments to IFRS 17 “Insurance Contracts”	January 1, 2023
Amendments to IFRS 17 “Initial Application of IFRS 17 and	January 1, 2023
IFRS 9 - Comparative Information”
Amendments to IAS 21 “Lack of Exchangeability”	January 1, 2025

The Group has assessed that the above standards and interpretations have no material impact on the Group's financial position and financial performance.

IV. Summary of Significant Accounting Policies

The major accounting policies adopted in the preparation of the financial statements are described below. Unless otherwise stated, these policies apply consistently throughout all reporting periods.

(I) Compliance statement

The consolidated financial report has been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards (IFRSs), International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the FSC.

~19~

(II) Compilation basis

Except for financial assets at FVTPL and financial assets at FVTOCI, the financial statement is prepared based on historical costs.
The compilation of financial statement in compliance with IFRSs requires the use of some important accounting estimates. In the process of adopting the Group's accounting policies, management also needs to adopt the judgments, which involve in highly judgmental or complex items, or major assumptions and estimated items in financial statements. For details, please refer to Note 5.

(III) Consolidation basis

Basis for preparation of consolidated financial statements
(1) The Group incorporates all subsidiaries into entities for the preparation of financial statements. The subsidiary refers to an entity controlled by the Group, when the firm is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity, it shall be regarded that the Group is controlling the entity. Subsidiaries are included in the consolidated financial report from the date when the Group obtains control, and are terminated from the date when control is lost.
(2) Intra-group transactions, balances and unrealized gains and losses are eliminated. The accounting policies of the subsidiaries have been adjusted as necessary to be consistent with the policies adopted by the Group.
(3) Profit and loss and other components of comprehensive profit and loss are attributable to the owners and non-controlling interests of the parent company; the total comprehensive profit and loss is also attributable to the owners and non-controlling interests of the parent company, even if the non-controlling interests suffer losses due to this.
(4) If the change in the shareholding of the subsidiary does not result in a loss of control (transactions with non-controlling interests), it will be regarded as an equity transaction, which is being regarded as the transaction with the owner. Any difference between the adjusted amount of non-controlling interests and the fair value of the consideration paid or received is directly recognized in equity.
(5) When the Group loses control over the subsidiary, the remaining investment in the former subsidiary is remeasured at fair value and adopted as the fair value of the originally recognized financial assets or the cost of the originally recognized investment in affiliated enterprises or joint ventures. The difference between the fair value and the carrying amount is recognized as profit or loss of the current period. For all amounts previously recognized in other comprehensive profit or loss related to the subsidiary, the accounting treatment is the same as if the Group directly disposes of the relevant assets or liabilities, that is, if the benefit or loss previously recognized as other comprehensive profit or loss will be reclassified as profit or loss when disposing of the relevant assets or liabilities, when control of the subsidiary is lost, the benefit or loss will be reclassified from equity to profit or loss.

~20~

Subsidiaries included in the financial statements are as follows:

Name of the	Percentage of shareholding Expl
Investment Company Name of Investee Business type	anati December 31, December 31,
	on 2023 2022
The HCW General	100.00 100.00
Company INVESTMENT CO., LTD. investment
The Investment	33.00 33.00 Note
Company Hanlin Development Co., Ltd. in real estate and buildings

Note: The Company's shareholding in the company was increased from 33% to 51% on March 11, 2024. Please refer to Note 11 for details.

Subsidiaries not included in the consolidated financial statements: None.
Different adjustments and treatments in the accounting period of subsidiaries: None.
Major restrictions: None.
Subsidiaries with significant non-controlling equity of the Group:

The total amount of non-controlling interests of the Group as of December 31, 2023 and 2022 were NT$552,999 and NT$542,262, respectively. The following is the information about the significant non-controlling interests of the Group and its subsidiaries:

Name of Investee Principal place of business	Non-controlling interests Non-controlling interests
	December 31, 2023 December 31, 2022
	Amount Percenta ge of sharehol ding Amount Percenta ge of sharehol ding
Hanlin Development Taiwan	$ 552,999 67 $ 542,262 67

Summarized financial information of subsidiaries:

Balance Sheet

Balance Sheet
	Hanlin Development
	December 31, 2023	December 31, 2022
Current assets	$ 827,670	$ 829,581
Non-current assets	848,006	858,178
	( 345,507 )	( 357,795)
Current liabilities
Non-current liabilities	(	( 520,616)
	504,798 )
Total net assets	$ 825,371	$ 809,348

~21~

Statement of Comprehensive Income

		Hanlin Development 2023 2022 $ 194,835 $ 552,376 $ 19,989 $ 68,897 ( 3,966) ( 11,886) 16,023 57,011 $ 16,023 $ 57,011 $ 10,737 $ 38,197 Hanlin Development 2023 2022 $ 82,500 $ 68,558 ( 8,231) 212,593 ( 7,176) ( 270,447) 67,093 10,704 211,045 200,341 $ 278,138 $ 211,045
		2023
Income		$ 194,835
Income before tax		$ 19,989
Income tax expenses		( 3,966)
Current period net profit		16,023
Total comprehensive		$ 16,023
Comprehensive income attributed to non-controlling interests		$ 10,737
Statement of Cash Flow

		2023
Net cash inflow from		$ 82,500
operating activities
Net cash (outflow) inflow		( 8,231)
from investing activities
Net cash inflow (outflow)		( 7,176)
from financing activities
Decrease in cash and cash		67,093
equivalents for the current period
Cash and cash equivalents		211,045
Cash and equivalent cash		$ 278,138
balance at the beginning of the period

(IV) Foreign currency conversion

Items included in the financial statements of each entity within the Group are measured using the currency of the primary economic environment in which the entity operates (i.e., the functional currency). The consolidated financial statements are presented in the Company's functional currency “NT$”.

Foreign currency transactions and balances

Foreign currency transactions are converted into functional currency at the spot exchange rate on the transaction date or measurement date, and the conversion difference arising from the conversion of these transactions is recognized as current profit or loss.
The balance of foreign currency monetary assets and liabilities is evaluated and adjusted according to the spot exchange rate on the balance sheet date, and the translation difference arising from the adjustment is recognized as current profit or loss.
The balance of foreign currency non-monetary assets and liabilities, which are at FVTPL, shall be adjusted according to the spot exchange rate on the balance sheet date, and the exchange difference arising from the adjustment shall be recognized as current profit or loss; if it is at FVTOCI, it shall be adjusted at the spot exchange rate on the balance sheet date, and the exchange difference arising from the adjustment shall be recognized in other comprehensive profit or loss; if it is not at fair value, it shall be at the historical exchange rate on the initial transaction date.

~22~

All exchange gains and losses are listed in “Other Gains and Losses” in the Consolidated Income Statement.
(V) Classification criteria for current and non current assets and liabilities

The Group is engaged in entrusting construction companies to build or sell buildings, and its business cycle is usually longer than one year. Assets and liabilities related to construction projects are classified as current or non-current based on the business cycle; and the standards for the classification of other items as current and non-current are as follows:

Assets that meet one of the following conditions are classified as current assets:
(1) The asset is expected to be realized, or it is intended to be sold or consumed in the normal business cycle.
(2) Mainly held for the purpose of trading.
(3) Those expected to be realized within 12 months after the balance sheet date.
(4) Cash or cash equivalents, except those that can be exchanged at least 12 months after the balance sheet date or used to settle liabilities are restricted.

The Group classifies all assets that do not meet the above conditions as non-current.

Liabilities that meet one of the following conditions are classified as current liabilities:
(1) Expected to be settled in the normal business cycle.
(2) Mainly held for the purpose of trading.
(3) Those expected to be paid off within 12 months after the balance sheet date.
(4) The repayment period cannot be unconditionally postponed to at least 12 months after the balance sheet date. The terms of the liabilities may be based on the choice of the counterparty, which may be settled by issuing equity instruments, and its classification is not affected.

The Group classifies all liabilities that do not meet the above conditions as non-current.

(VI) Cash equivalents

Cash equivalents refer to short-term and highly liquid investments that can be converted into fixed amounts of cash at any time with little risk of changes in value. Time deposits that meet the definition above and are held to meet shortterm cash commitments in operations are classified as cash equivalents.

(VII) Financial assets at FVTPL

Refers to financial assets that are not at amortized cost or at FVTOCI.
The Group adopts transaction-day accounting for financial assets at FVTPL that conform to customary transactions.
The Group measures it at fair value at the time of initial recognition, and the relevant transaction costs are recognized in profit or loss, and

~23~

subsequently at fair value, and its profits or losses are recognized in profit or loss.

When the right to receive dividends is established, the economic benefits related to dividends are likely to flow in, and the amount of dividends can be measured reliably, hence the Group recognizes dividend income in profit or loss.

(VIII) Financial assets at FVTOCI

Refers to an irrevocable choice made at the time of original recognition to present changes in the fair value of equity instrument investments not held for trading in other comprehensive income.
The Group adopts transaction-day accounting for financial assets at fair value through other comprehensive gains and losses that conform to transaction practices.
The Group measures at its fair value plus transaction costs at the time of original recognition, and subsequently at fair value:

Changes in the fair value of equity instruments are recognized in other comprehensive profit or loss. When delisting, the accumulated gains or losses previously recognized in other comprehensive profit or loss shall not be reclassified to profit or loss, and shall be transferred to retained earnings. When the right to receive dividends is established, the economic benefits related to dividends are likely to flow in, and the amount of dividends can be measured reliably, hence the Group recognizes dividend income in profit or loss.

(IX) Financial assets at amortized cost

Refers to those who meet the following conditions at the same time:
(1) The financial asset is held under the business model for the purpose of collecting contractual cash flow.
(2) The contract terms of the financial asset generate cash flow on a specific date, which is entirely the payment of principal and interest on the outstanding principal amount.
The Group adopts transaction-day accounting for financial assets at cost after amortization that comply with transaction practices.
The Group measures its fair value plus transaction costs at the time of initial recognition, and then adopts the effective interest method to recognize interest income and impairment losses during the circulation period according to the amortization procedure, and when delisting, it will be recognized the gain or loss is recognized in profit or loss.
The time deposits held by the Group that are not categorized as cash equivalents are measured by the investment amount because the holding period is short and the impact of discounting is not significant.

(X) Accounts and Notes Receivable

Refers to accounts and notes that have the unconditional right to receive the consideration amount in exchange for the transfer of goods or services in accordance with the contract.
For unpaid short-term accounts and notes receivable, since discounting has

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little effect, the Group measures them based on the original invoiced amount.

(XI) Impairment of financial assets

On each balance sheet date, for financial assets at amortized cost, after considering all reasonable and supportable information (including forwardlooking information), the Group has no significant increase in credit risk since the original recognition , which measures the allowance loss by the amount of 12-month expected credit losses; for those whose credit risk has increased significantly since the original recognition, the allowance for loss shall be measured according to the amount of expected credit loss during the duration; for accounts receivable that do not include significant financial components, the allowance for loss shall be measured according to the amount of expected credit loss during the duration.

(XII) Delisting of financial assets

Financial assets will be delisted when the Group's contractual rights to receive cash flows from the financial assets lapse.

' - (XIII) Lessor s lease transaction Business lease

Lease income from business leases and net of any incentives given to the lessee will be amortized on a straight-line basis over the lease term and recognized as current profit or loss.

(XIV) Inventory

Including land for construction, premises under construction, and premises for sale, etc., the acquisition cost is adopted as the accounting basis, and the project profit and loss is recognized according to the completed contract method. The land for construction is listed as the premises under construction when it is actively developed, and the relevant interest is capitalized from the time of active development or construction to the completion of the work.
Inventory at the end of the period is measured by the lower of cost and net realizable value. When comparing the lower of cost and net realizable value, the item-by-item comparison method is adopted; and the net realizable value is the estimated selling price in the normal course of business less the estimated cost to complete and the estimated cost to complete the sale.

- (XV) Investments using the equity method Affiliated enterprises

Affiliated enterprises refer to all entities over which the Group has significant influence but no control, generally directly or indirectly holding more than 20% of their voting shares. The Group adopts the equity method to dispose of the investment in affiliated enterprises, and recognizes it at cost when acquired.
The Group recognizes the share of profit and loss acquired by the affiliated enterprises as profit and loss of the current period, and the share of other comprehensive profit and loss acquired by the Group as other comprehensive profit or loss. If the Group's share of losses to any affiliated enterprise is equivalent to or exceeds its equity in the affiliated enterprise (including any other unsecured receivables), the Group will not recognize further losses unless the Group has any legal or constructive obligations

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to, or has paid on behalf of the affiliated enterprise.

When the affiliated enterprise has any non-profit or loss and other comprehensive profit or loss equity changes that do not affect the shareholding ratio, the Group will recognize all equity changes as “capital surplus” based on the shareholding ratio.
The unrealized gains and losses arising from transactions between the Group and affiliated enterprises have been eliminated in proportion to its equity in the affiliated enterprises; unless there is further evidence that the assets transferred in the transaction have been impaired, unrealized losses will also be eliminated. The accounting policies of the affiliated enterprises have been adjusted as necessary to be consistent with the policies adopted by the Group.
In the event that an affiliate enterprise issues new shares, and the Group does not subscribe to the new shares in accordance with the proportion, resulting in a change in the investment ratio but still having a significant impact on it, the increase or decrease of the change in the net equity value is to adjust the “capital surplus” and “investments accounted for under the equity method”. If the proportion of investment is reduced, in addition to the above-mentioned adjustments, the gains or losses related to the reduction of ownership interests that have been previously recognized in other comprehensive profit or loss, and the gains or losses must be reclassified to profit or loss when disposing of related assets or liabilities, it shall be reclassified to profit or loss according to the reduction ratio.
When the Group disposes of an affiliated enterprise and loses its significant influence on such affiliated enterprise, for all amounts previously recognized in other comprehensive profit or loss related to the affiliated enterprise, the accounting treatment is the same as if the Company directly disposes of the relevant assets or liabilities, that is, if the benefit or loss previously recognized as other comprehensive profit or loss will be reclassified as profit or loss when disposing of the relevant assets or liabilities, when control of the affiliated enterprise is lost, the benefit or loss will be reclassified from equity to profit or loss. If there is still a significant influence on the affiliated enterprises, only the amount previously recognized in other comprehensive profit and loss shall be transferred out in the above-mentioned manner on a proportionate basis.

(XVI) Joint Agreements

For the interests in joint operations, the Group recognizes the direct rights (and their shares) to the assets, liabilities, income and expenses of the joint operations, and has included them in the applicable items of the financial report.
When participating in a joint venture without joint control, the Group will handle its interest in the agreement in accordance with the provisions of IFRS 9 “Financial Instruments”.
(XVII) Property, plants, and equipment
1. Real estate, plant and equipment are recorded on the basis of acquisition cost.
2. Subsequent costs are included in the book value of the asset or

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recognized as a separate asset only when the future economic benefits related to the item are likely to flow into the Group and the cost of the item can be measured reliably. The book value of the replaced part shall be delisted. All other maintenance expenses are recognized as current profit or loss when incurred.

The subsequent measurement of property, plant and equipment adopts the cost model. Except for land, which is not listed for depreciation, the depreciation will be calculated using the straight-line method based on the estimated service life. If the composition of property, plant and equipment is significant, it will be depreciated separately.
The Group examines the residual value, service life and depreciation method of each asset at the end of each financial year. If the expected value of the residual value and service life is different from the previous estimate, or the future economic value contained in the asset If there is a significant change in the expected consumption pattern of benefits, it shall be handled in accordance with the accounting estimate change provisions of International Accounting Standard No. 8 “Accounting Policies, Changes in Accounting Estimates and Errors” from the date of the change. The service life of each asset is as follows:

Houses and buildings 8 to 20 years Office equipment 5 to 23 years

' - - - (XVIII) Lessee s lease transaction right of use asset/lease liability

Lease assets are recognized as right-of-use assets and lease liabilities on the day they become available to the Group. When the lease contract is a short-term lease or a lease of a low-value underlying asset, the lease payment is recognized as an expense during the lease period using the straight-line method.
Lease liabilities are recognized at the present value of unpaid lease payments discounted at the Group's incremental borrowing rate on the lease commencement date. Lease payments are fixed payments, less any lease incentives that can be received. Subsequent adoption of the interest method is measured by the amortized cost method, and interest expenses are provided during the lease period. When the lease term or lease payment changes due to non-contract modification, the lease liability will be reassessed, and the remeasurement amount will be adjusted to the right-of-use asset.
The right-of-use asset is recognized at cost on the lease commencement date, and the cost is the original measured amount of the lease liability. Subsequent measurement is made using the cost model, and depreciation expenses are provided when the service life of the right-of-use asset expires or when the lease period expires, whichever is earlier. When the lease liability is reassessed, the rightof-use asset will adjust any remeasurement of the lease liabilities.
For a lease modification that reduces the scope of the lease, the

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lessee will reduce the book amount of the right-of-use asset to reflect partial or complete termination of the lease, and recognize the difference between it and the remeasured amount of the lease liability in profit or loss.

(XIX) Investment property

Investment real estate is recognized at acquisition cost, and the subsequent measurement adopts the cost model. Except for land, depreciation is provided by the straight-line method according to the estimated service life which ranges from 8 to 60 years.

- (XX) Impairment of non financial assets

On the date of balance sheet, the Group will estimate the recoverable amount of assets which may be subject to impairment, and recognize the impairment loss when the recoverable amount is lower than its book value. The recoverable amount is the fair value of an asset less costs of disposal or its value in use, whichever is higher. When the asset impairment recognized in the previous year does not exist or decreases, the impairment loss shall be reversed. However, the increase in the book value of the asset due to the reversal of the impairment loss shall not exceed the book amount of the asset after deducting depreciation or amortization if no impairment loss is recognized.

(XXI) Borrowings

The long- and short-term funds borrowed from banks. The Group measured it at the fair value less transaction costs at the time of original recognition, and subsequently recognized any difference between the price after deducting transaction costs and the redemption value, and adopted the effective interest method and amortizing procedures to recognize interest expenses during the circulation period in profit and loss.

(XXII) Notes and Accounts Payable

Refers to the debts incurred due to the purchase of raw materials, commodities, or services on credit, and the notes payable incurred due to business and non-business matters.
For unpaid short-term accounts and notes payable, since discounting has little effect, the Group measures them based on the original invoiced amount.

(XXIII) Delisting of financial liabilities

The Group delists financial liabilities when the obligations specified in the contract are performed, canceled or expired.

(XXIV) Employee benefits

Short-term employee benefits

Short-term employee benefits are at non-discounted amounts expected to be paid and are recognized as an expense when the related service is rendered.

Pension

For a definite contribution plan, the amount of the pension fund that shall be appropriated is recognized as the current pension cost on the

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basis of accruals. Advance payments are recognized as assets to the extent that they are refundable in cash or reduce future payments.

3. Severance benefits

Severance benefits are benefits provided when the employee's employment is terminated before the normal retirement date or when the employee decides to accept the company's welfare offer in exchange for the termination of employment. The Group recognizes an expense when it is no longer possible to withdraw the offer of termination benefits or when the related restructuring costs are recognized, whichever is earlier. Benefits that are not expected to be fully settled within 12 months after the balance sheet date will be discounted.

4. Employees and directors remuneration

Employee remuneration and directors' remuneration are recognized as expenses and liabilities when there is a legal or constructive obligation and the amount can be reasonably estimated. If there is a discrepancy between the actual distribution amount and the estimated amount in subsequent resolutions, it shall be treated as a change in accounting estimate. In addition, if employee remuneration is paid by stock, the basis for calculating the number of shares is the closing price on the day before the resolution of the board of directors.

(XXV) Income Tax

Income tax expense includes current and deferred income tax. Income taxes are recognized in profit or loss, except for income taxes that relate to items that are recognized in other comprehensive profit or loss or directly in equity, respectively.
The Group calculates current income tax based on the tax rate that has been enacted or substantively enacted on the balance sheet date in the country where the Group operates and generates taxable income. The management level periodically assesses the status of income tax filings with respect to applicable income tax regulations and, where applicable, estimates income tax liabilities based on the expected tax payments to the taxation competent authorities. For undistributed earnings, additional income tax is levied in accordance with the Income Tax Law. In the year following the year in which the earnings are generated, the undistributed earnings income tax expense shall be recognized based on the distribution of the actual earnings after the shareholders' meeting approves the earnings distribution proposal.
The balance sheet method is adopted for deferred income tax, which is recognized according to the temporary difference between the tax basis of assets and liabilities and their carrying amount on the balance sheet. Deferred income tax liabilities arising from the original recognition of goodwill are not recognized if the deferred income tax arises from the original recognition of assets or liabilities in a transaction (excluding business combinations) and at the time of the transaction. If it does not affect accounting profit or taxable income (tax loss), and does not generate equivalent taxable and deductible

~29~

temporary differences, it will not be recognized. For temporary differences related to investment in subsidiaries and affiliated enterprises, if the Group can control the timing of the reversal of the temporary difference and it is highly likely that the temporary difference will not reverse in the foreseeable future, it will not be recognized. The deferred income tax is based on the tax rate (and taxation laws) that has been enacted or substantively enacted on the balance sheet date and is expected to be applicable when the relevant deferred income tax assets are realized or the deferred income tax liabilities are settled.

Deferred income tax assets are recognized within the scope of temporary differences, unused tax losses and unused income tax credits that are likely to be available in future taxable income, and are reassessed on each balance sheet date. Evaluate unrecognized and recognized deferred tax assets.
The later part of the unused income tax deduction due to the purchase of equipment or technology, research and development expenditure, and equity investment, etc., which is within the scope of future taxable income that is likely to be used for the unused income tax deduction. Recognize deferred income tax assets.

(XXVI) Dividend distribution

The dividends distributed to the shareholders of the Company are recognized in the financial report when the shareholders' meeting of the Company resolves to distribute dividends, and the distribution of cash dividends is recognized as the liability.

(XXVII) Revenue recognition

1. Product sales

Mainly wool tops, shrink-resistant wool tops and shrink-resistant loose wool, etc. Sales revenue is recognized when the goods are sold to customers, and revenue is recognized based on the price stated in the contracts. The Company has had no such operating revenue since June 2022.

Real estate sales for land development
(1) The main business of the Group is land development and sales of real estate, and the revenue is recognized when the control of real estate is transferred to customers. For the signed residential sales contracts, due to the restrictions of the contract terms, the real estate has no other use for the Group, but the Group will not have the enforceable right to the contract payment until the legal ownership or use right of the real estate is transferred to the customer. Revenue is recognized when the ownership or use right is transferred to the customer.
(2) Part of the Group's sales contracts include the change consideration of price reduction, and the Group takes the expected value or the most likely amount as the appropriate estimate of the change consideration.
(3) The Group's contract for the sale of pre-sale houses contains the

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terms of advance payment from customers, and the time interval between the time of advance receipt and the transfer of commodity control is longer than one year. According to the provisions of IFRS15, if the Group judges that there are significant financial components in individual pre-sale house contracts, it should adjust the amount of promised consideration and recognize interest expenses. In addition, IFRS15 states that enterprises shall only consider the materiality of financial components at the contract level, and not consider whether financial financing is significant at the portfolio level.

3. Lease revenue

A lease is classified as a finance lease when the terms of the lease transfer substantially all the risks and rewards of the leased asset to the lessee. The others are classified as operating leases. Under a finance lease, amounts due from the lessee are included as lease receivables. Financing income is apportioned to each accounting period to reflect the fixed rate of return available in each period. Lease income from operating leases is recognized as income on a straightline basis over the term of the relevant lease.

(XXVIII) Organizational restructuring under joint control

According to the IFRS Q&A of “Accounting Concerns about Business Combinations under Joint Control” issued by the Accounting Research and Development Foundation on October 26, 2018, due to the International Financial Reporting Standard No. 3 “Business Combinations”, there is no clear regulation on the merger of enterprises under joint control, so the accounting treatment of organizational reorganization within the group shall still apply the provisions of the relevant explanation letters issued in Taiwan. The book value method is adopted, and it is regarded as the restructuring of the previous financial statements from the beginning of the merger.
In the third quarter of 2022, the Company acquired 33% of the equity of Hanlin Development Co., Ltd., a subsidiary of Hanshin Asset Management Co., Ltd. (the ultimate parent company of the Group), and obtained more than half of the seats of its board of directors. Because this equity transaction is an organizational reorganization under common control, according to the ARDF official letter (2012) JiMi-Zhi No. 301, the Company considers that Hanlin Development has been merged from the beginning, and when recompiling the financial statements of previous years, it shall attribute the share of the equity originally belonged to the shareholders of Hanlin Development (Hanshin Asset Management Co., Ltd.) to the “equity owned by the previous holder under the joint control”, and the share of profits and losses originally belonged to the shareholders of Hanlin Development (Hanshin Asset Management Co., Ltd.) shall attributed to the “net profit (loss) owned by the previous holder under the joint control”.

(XXIX) Operating segment

Information on the Group's operating segments is reported in a manner consistent with the internal management reports provided to the chief

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decision-maker of business operation. The chief decision-maker of business operation is responsible for allocating resources to operating departments and evaluating their performance.

V. Major sources of uncertainty in major accounting judgments, estimates and assumptions

When the Group prepared these financial statements, the management level has adopted its judgment to determine the accounting policies adopted, and made accounting estimates and assumptions based on the current situation at the balance sheet date and reasonable expectations of future events. The major accounting estimates and assumptions made may differ from the actual results, and will be continuously evaluated and adjusted taking into account historical experience and other factors. These estimates and assumptions have a risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year. Please explain in detail the following explanations on the uncertainty of major accounting judgments, estimates and assumptions:

(I) Important Judgments for Adoption of Accounting Policies

None.

(II) Important Accounting Estimates and Assumptions

1. Impairment testing of investment using the equity method

When there is an indication of impairment that an investment using the equity method may have been impaired so that the carrying amount cannot be recovered, the Group immediately assesses the impairment of the investment. The Group evaluates the recoverable amount based on the discounted present value of the expected future cash flow of the invested company, and analyzes the rationality of the relevant assumptions.

2. Valuation of inventories

Because inventories shall be priced at the lower of cost and net realizable value, the Group shall adopt judgment and estimation to determine the net realizable value of inventories on the balance sheet date. The management of the Group mainly relies on historical experience and the amount of future market sales value It is the basis of estimation and therefore may be subject to material changes.

VI. Explanation of important accounting items

(I) Cash and cash equivalents

Cash and cash equivalents
	December 31, 2023	December 31, 2022 $ 33 471,927 49,800 $ 521,760
Cash on hand	$ 58
Demand deposits	476,040
Time deposits	129,005
	$ 605,103

The credit quality of the financial institutions that the Group interacts with is good, and the Group interacts with a number of financial institutions to diversify the credit risk, and the risk of default is expected to be very low.
Please refer to Note 8 for details of the Group's performance guarantee, reserve account and trust deposit account, and the collateral account as a pledge guarantee (account listed in “Other Financial Assets - Current and Non-Current”).

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- (II) Financial assets at amortized cost Current

	December 31, 2023	December 31, 2022 $ 80,000
Time deposits	$ 20,000

In 2023 and 2022, the Group's interest income recognized in profit or loss due to financial assets at amortized cost was NT$1,331 and NT$186 (tabled as “interest income”) respectively.
Without regard to the collateral held or other credit enhancements, it is the most representative of the financial assets held by the Group at amortized cost. On December 31, 2023 and 2022, the amount of the maximum credit risk exposure was NT$20,000 and NT$80,000, respectively.
The Group has not provided financial assets at amortized cost as pledge guarantees.

(III) Notes receivable and net accounts

	December 31, 2023	December 31, 2022 $ 19,613 $ 6,062
Notes receivable	$ 27,668
Accounts receivable	$ 7,114

The Group's notes receivable and accounts receivable are not overdue and not impaired.
The Group's notes receivable and accounts receivable balances on December 31, 2023 and 2022 were all due to customer contracts, and the balance of receivables from customer contracts on January 1, 2022 was NT$27,889.
The Group has not provided pledge guarantees for bills receivable and accounts.
Regardless of the collateral held or other credit enhancements, the amount of exposure that best represents the maximum credit risk of the Group's notes and accounts receivable on December 31, 2023 and 2022 were NT$34,782 and NT$25,675 respectively.
Please refer to Note 12 (2) for the credit risk information of relevant notes receivable and accounts receivable.

(IV) Inventory

nventory
		December 31, 2023		December 31, 2022
Land for construction
Project Zhongxiao Mansion	$	6,601	$	6,601
Premises for sale
Project Emerald Forest		47,174		97,739
Project Smiling Era		9,267		58,808
		56,441		156,547
Building and land under
construction
Ascent Development Original
Development Project (formerly
Project Zhonghe Chungyuan)		663,436		638,579
Project Kuo Yang
Intercontinental (previously
known as Project Neihu
Jiuzong)		447,276		384,372
Project Kuo Yang Digital		433,312		372,755

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(previously known as project Sanchong Chunghsing)
Project Tucheng Zhongyi	258,363	248,109
Project Xizhi Jiangbei	220,483	197,532
Project Emerald Forest	31,094	5,164
	2,053,964	1,846,511
Advance payment for real
estate and others
Project Emerald Forest	54,473	54,473
Project Xizhi Jiangbei	571	3,687
	55,044	58,160
	$ 2,172,050	$ 2,067,819

Accounting inventory refers to the share recognized in accordance with the holding ratio of the Group's participation in joint operations. Please refer to Note 6(5) for details.
Project Smiling Era is No. 1492 to 1496 of Shengxing Section, Qianzhen District, Kaohsiung City, the “contract for setting of surface rights of stateowned non-public land” signed by “Shenyang Construction Co., Ltd.” on April 28, 2014 with the Southern Branch of National Property Administration, MOF, and the duration of surface rights is 70 years (from April 28, 2014 to April 27, 2084), and the premium for surface rights is NT$878,000. The Group started construction in 2015, which was completed in 2018 while the transfer of ownership and right-of-use began, the revenue for the sold part was recognized, and the above-mentioned royalties was listed as costs of sales according to the sales ratio.
Inventory costs recognized as expenses in 2023 and 2022 by the Group were NT$120,689 and NT$422,635, respectively.
The Group's capitalized amounts of interest on inventories in 2023 and 2022 were NT$33,539 and NT$15,769, respectively, and the capitalization rates were 2.425% to 2.76% and 1.80% to 3.00%, respectively.
Please refer to Note 8 for details of the Group’s provision of guarantees for inventories.

(V) Joint Operation

Part of the Group's development and construction projects are joint operations. For the rights and interests of joint operations, the Group recognizes its direct interests (and their shares) in the assets, liabilities, income and expenses of joint operations, and has included them in the consolidated financial report of the applicable items.
The information on the joint operation and development projects held by the Group is as follows:

Project name	Shareholding	Co-builder Explanation
	percentage
Ascent	50%	Weili International Development Co., Ltd. and two other companies Zhonghe District, New Taipei City
Development
Original Project
(Formerly
Project
Zhonghe
Chungyuan)
Project Smiling	30%	Shenyang Construction Co., Ltd. Qianzhen

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Era		District, Kaohsiung City

Project Kuo	15%	Kuo Yang Construction Co., Ltd. and three other companies Sanchong District, New Taipei City
Yang Digital
(Original
Sanchong
Zhongxing
Project)
Project Kuo	10%	Kuo Yang Construction Co., Ltd. and four other companies Neihu District, Taipei City
Yang
Intercontinental
(Original Neihu
Jiuzong Project)
Project		Kuo Yang Construction Co., Ltd. and three other companies Tucheng District, New Taipei City
Tucheng
Zhongyi	10%
Project Emerald	10%	Kuo Yang Construction Co., Ltd. and four other companies Annan District, Tainan City
Forest

		Kuo Yang Construction Co., Ltd. and three other companies Xizhi District, New Taipei City
Project Xizhi
Jiangbei	10%

The aggregate information on the shares of joint operation held by the Group is as follows:

			December	December	31, 2023	31, 2023
	Project Kuo
		Yang	Project Smiling		Project Emerald
Balance Sheet	Intercontinental		Era			Forest	Other projects
Current assets
Inventory	$	447,276	$	9,267	$	132,741	$	1,582,766
Other current		10,199		46,171		59,842		239,394
assets
		457,475		55,438		192,583		1,822,160
Non-current assets		-		15,048		3,660		26
Total assets	$	457,475	$	70,486	$	196,243	$	1,822,186
Current liabilities
Short-term
borrowings	$	270,372	$	-	$	-	$	1,092,429
Other current		61,519		3,095		31,031		170,446
liabilities
		331,891		3,095		31,031		1,262,875
Non-current liabilities		-		-		-		538
Total liabilities	$	331,891	$	3,095	$	31,031	$	1,263,413
Statement of
Comprehensive
Income
Income	$	-	$	65,803	$	71,099	$	6,312
Costs	$	-	$	49,604	$	52,863	$	3,595
Expenses	$	258	$	4,946	$	3,439	$	1,358
			December		31, 2022
	Project Kuo
		Yang	Project Smiling		Project Emerald
Balance Sheet	Intercontinental		Era			Forest	Other projects
Current assets
Inventory	$	384,372	$	58,808	$	157,376	$	1,467,263
Other current		9,532		58,904		54,818		45,603
assets

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			393,904	393,904	117,712		212,194
Non-current assets			20		10,814		3,663
Total assets			$ 393,924		$ 128,526	$	215,857
Current liabilities
Short-term borrowings			$ 261,178		$ -	$	8,220
Short-term notes payable			-		-		28,762
Other current liabilities			16,925		45,147		10,625

			278,103		45,147		47,607
Non-current liabilities			-		-		-
Total liabilities			$ 278,103		$ 45,147	$	47,607
Statement of Comprehensive Income

Income			$ 286		$ 365,466	$	137,095
Costs			$ -		$ 293,814	$	114,199
Expenses			$ 255		$ 22,758	$	8,570
(VI)	Financial assets at FVTPL Items Financial assets mandatorily at FVTPL Current item Stocks of listed/OTC companies Evaluation adjustment Non-current items Joint development projects

		Items			December 31, 2023
		Financial assets mandatorily at
		FVTPL
		Current item
		Stocks of listed/OTC			$ 33,160
		companies
		Evaluation adjustment		(	1,535)
					$ 31,625
		Non-current items
		Joint development projects			$ 86,000

(VI) Financial assets at FVTPL

The Group's financial assets at FVTPL had a net income (loss) of (NT$870) and NT$0 recognized in profit or loss in 2023 and 2022, respectively.
The Group did not provide financial assets at FVTPL as pledge guarantees.
In 2019, Hanlin Development signed a joint investment and land development agreement with five other companies. Therefore, the investment purpose of Hanlin Development is only to share profits without joint control, the interest in the agreement is treated in accordance with IFRS 9 “Financial Instruments” and listed as financial assets that are mandatory to be at FVTPL.

(VII) Financial assets at FVTOCI

L.
December 31, 2023	December 31, 2022 $ 296,395 ( 147,489) $ 148,906

$ 278,362
( 107,578)
$ 170,784

The Group categorizes strategic investments and equity instrument investments for stable dividend collection as financial assets at fair value through other comprehensive profit and loss, and the fair values of these investments on December 31, 2023 and 2022 were NT$170,784 and NT$148,906, respectively.
The details of the financial assets at fair value through other comprehensive

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profit and loss recognized in profit or loss and comprehensive profit or loss are as follows:

are as follows:
	2023	2022
Disposal of equity
instruments at FVTOCI
Changes in fair value	$ 41,081	($ 41,365)
recognized in other comprehensive profit or loss
Accumulated benefits	$ 1,170	$ 76
transferred to retained earnings due to delisting
Dividend income		$ 3,334 20
recognized in profit or loss
Held at the end of	$ 3,110
the current period
Delisted during the	120
current period
	$ 3,230	$ 3,354

Regardless of the collateral held or other credit enhancements, the most representative of the financial assets held by the Group at fair value through other comprehensive profit and loss. On December 31, 2023 and 2022, the amount of risky exposure with the largest credit risk was NT$170,784 and NT$148,906, respectively.
The Group has not provided financial assets at FVTOCI as pledge guarantees.

(VIII) Investments accounted for using equity method

		December 31, 2023
January 1		$ 939,639
Investment gains and losses
recognized using the equity method
		213,271
Distribution of investment	(
surplus using the equity method
		89,023)
Impairment losses on
investments using the equity method		-

Changes in capital surplus		-
Changes in other equity		91,154
December 31		$ 1,155,041


		December 31, 2023
Affiliate
Hanshin Shopping Plaza Co.,
Ltd.
Jollify Creative, Ltd.		49,743
Jollify4ever Ltd.		-
		$ 1,155,041

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- Affiliate
(1) The basic information of the major affiliated enterprises of the Group is as follows:

Principal	Shareholding percentage	Shareholding percentage
place of business	December 31,	Nature of relationship ment method December 31, 2022
	2023
Taiwan		17.80% - Affiliate Equity method
	17.80%

(2) The consolidated financial information of the Group's major affiliated enterprises is as follows:

Balance Sheet

enterprises is as follows: Balance Sheet
	Hanshin Shopping Plaza Co., Ltd.
	December 31, 2023 December 31, 2022
Current assets	$ 5,491,584 $ 3,524,083
Non-current assets	9,285,449 9,591,348
Current liabilities	( 4,152,523) ( 3,398,335)
Non-currentliabilities	( 6,146,034) ( 6,464,698)
Total net assets	$ 4,478,476 $ 3,252,398
Proportion of net assets of	$ 761,565 $ 542,042
affiliated enterprises
Goodwill	343,733 343,733
Book value of affiliated	$ 1,105,298 $ 885,775
enterprises
Statement of Comprehensive
Income
	Hanshin Shopping Plaza Co., Ltd.
	2023	2022
Income	$ 3,610,735	$ 3,102,720
Net income from continuing		$ 1,092,767
operations	$ 1,276,009
Other comprehensive income		( 338,884)
(net, after tax)	553,189
Total comprehensive income of		$ 753,883
the current period	$ 1,829,198

(3) On December 31, 2023 and 2022, the book value of individual insignificant affiliated enterprises of the Group was NT$49,743 and NT$53,864 respectively, and the share of their operating results is summarized as follows:

summarized as follows:
	2023	2022
Net loss from continuing	$ 3,269
		($ 10,594)
operations

Other comprehensive	( 7,390)
		( 4,105)
income (net, after tax)

Total comprehensive	($ 4,121)
		($ 14,699)
income of the current period

In 2022, the Group assessed that the investment in Jollify4ever Ltd. using the equity method had been impaired, so it recognized an impairment loss of NT$46,403 and listed it in “Other Gains and Losses”.
Jollify Creative, Ltd. handled a cash capital increase in September 2022. The Company did not participate in the subscription according to the shareholding ratio, and hence the shareholding ratio of Jollify Creative, Ltd. decreased from 46.83% to 37.46%. The Company is the largest single shareholder of that company. Since other shareholders (non-related persons of the Company) have signed a shareholder agreement, it shows

~38~

that the company has no actual ability to lead relevant activities, so it is judged that it has no control over the company and only has a significant influence.

In June 2023, JOLLIFY4EVER LTD. was resolved in the shareholders' meeting to reduce capital to make up for losses and increase capital in cash. The capital reduction amounted to NT$111,361, and 11,136 thousand shares were written off, representing a capital reduction ratio of 52.16%; the capital increase was $60,861. The Company has not participated in the subscription according to the shareholding ratio, and thus the shareholding of JOLLIFY4EVER LTD. was reduced from 46.83% to 29.34%. The Company is the largest single shareholder of that company. However, the combined shareholding of the other two largest shareholders exceeds the shareholding of the Company, it shows that the company has no actual ability to lead relevant activities, so it is judged that it has no control over the company and only has a significant influence.
There is no public quotation for the investment targets of the Group. For 2023 and 2022, the recognized share of investment income on investments accounted for using the equity method were NT$213,271 and NT$166,618, respectively; the share of other comprehensive income were NT$91,154 and NT$64,426, respectively. All are based on valuation of the financial statements audited and certified by the CPA of each investee company over the same period.

- (IX) Lease transactions Lessee

The underlying assets leased by the Group are office equipment and transportation equipment, and the lease contract period is usually 2 to 3 years. Lease contracts are negotiated individually and contain various terms and conditions. Except that the leased assets may not be used as loan guarantees, no other restrictions are imposed.
The book value of the right-of-use assets and the information of recognized depreciation expenses are as follows:

		December 31, 2023	December 31, 2022 Book value $ 13 90 $ 103 2022 Depreciation expense $ 33 361 $ 394
		Book value
Office equipment		$ 95
Transportation equipment		855
		$ 950

		2023
		Depreciation expense
Office equipment		$ 51
Transportation equipment		419
		$ 470

The increase in the Group's right-of-use assets for 2023 and 2022 were NT$1,317 and NT$0, respectively.

~39~

4. The information of income items related to lease contracts is as follows:


Items affecting current profit
and loss
Interest expense of lease
liabilities
-Investment property	$	2,329	$	2,369
Interest expense of lease
liabilities
-Right-of-use assets		20		7
Expenses of short-term lease
contracts		2,361		2,257

The total cash outflow for leases of the Group in 2023 and 2022 amounted to NT$7,337 and NT$6,252, respectively.

(X) Investment property

		2023	2023
	Land	Houses and buildings Land use right assets
January 1	$ 72,160	$ 692,684 $ 122,205
Depreciation	-	( 18,154) ( 3,087)
expense
December 31	$ 72,160	$ 674,530 $ 119,118

		2022
	Land	Houses and buildings	Land use right
			assets
January 1	$ 72,160	$ 710,841	$ 118,575
Depreciation	-	( 18,157)	( 3,087)
expense
Remeasurement	-	-	6,717
December 31	$ 72,160	$ 692,684	$ 122,205

1. Land use rights

On July 10, 2018, Hanlin Development signed a contract with Jimei Construction Co., Ltd. for the purchase of the land rights of its building and land located in Section 4, Minsheng East Road, Songshan District, Taipei City, Taiwan. This right is the “Contract for the Creation of Surface Rights over State-Owned Non-communal Land” signed with the North District Branch of the State-owned Property Administration, Ministry of Finance under Land Nos. 115-3 and 115-10, Minsheng Section, Songshan District, Taipei City, and the surface rights will last for 50 years (from August 8, 2012 to August 7, 2062).

~40~

Rent income and direct operating expenses of investment property:

	2023	2022
Rental income from investment real	$ 58,844	$ 51,672
estate
Direct operating expenses incurred in	$ 21,003	$ 20,848
the investment real estate generating rental income in the current period
Direct operating expenses incurred in	$ 2,317	$ 2,530
the investment real estate not generating rental income in the current period

The fair values of the investment real estate held by the Group on December 31, 2023 and 2022 were NT$1,162,251 and NT$2,217,944, respectively, which were based on the recent transaction prices of comparable similar targets in the area where the investment real estate is located and based on independent Evaluation results of evaluation experts. On December 31, 2023, the valuation was based on the comparative approach and the income approach, which was a Level 3 fair value. The main assumption was that the capitalization rate of gains was 1.17% - 1.89%.
Please refer to Note 8 for details of the guarantee provided by the Group with investment real estate.

- (XI) Short term borrowings

Short-term borrowings
	December 31, 2023 Interest rate range Collaterals
Nature of loan
Bank loans
	$ 1,330,329 2.55%~2.76% Please refer to Note 8
Secured loans
Credit loans	32,472 2.55%~2.65% None
	$ 1,362,801
	December 31, 2022 Interest rate range Collaterals
Nature of loan
Bank loans
	$ 1,205,647 2.425%~2.635% Please refer to Note 8
Secured loans
Credit loans	113,278 2.425%~2.525% None
	$ 1,318,925

Partially secured borrowings presented in the book refer to the share recognized by the Group in the joint operation according to the percentage of shareholding. Please refer to the descriptions in Note 6(5).
The interest expenses recognized in profit or loss in 2023 and 2022 were NT$10,810 and NT$8,797, respectively.

~41~

- (XII) Short term notes payable

Short-term notes payable
	December 31, 2023	December 31, 2022 $ 28,800 ( 38) $ 28,762 1.30%
Short-term notes payable	$ -
Less: Discount of short-term	-
notes payable
Net amount	$ -
Interest rate range	-

- (XIII) Long term borrowings

Long-term borrowings
Nature of loan Duration and repayment method Interest rate Collaterals	December 31,
	2023
Secured loans From February 23, 2022 to February 23, 2039, interest is paid on the 23rd of each month in three-month installments of NT$4,000 thousands every 3 months and the remaining balance is paid in a lump sum. 2.25% Please refer to Note 8
	$ 390,000
	390,000
Less: Long-term borrowings due within one year or one business
cycle	( 16,000)
	$ 374,000
Nature of loan Duration and repayment method Interest rate Collaterals	December 31,
	2022
Secured loans From February 23, 2022 to February 23, 2039, interest is paid on the 23rd of each month in three-month installments of NT$4,000 thousands every 3 months and the remaining balance is paid in a lump sum. 2.125% Please refer to Note 8
	$ 406,000
	406,000
Less: Long-term borrowings due within one year or one business	( 16,000)
cycle
	$ 390,000

(XIV) Pension

Since July 1, 2005, the Company and its domestic subsidiaries have established a defined retirement contribution allocation policy in accordance with the “Labor Pension Act”, which is applicable to domestic employees. The Company and its domestic subsidiaries shall contribute 6% of their monthly salaries into individual accounts held by the Bureau of Labor Insurance for employees who elect to apply the labor pension system under the “Labor Pension Act”. Depending on the amount of the personal pension account and the accumulated income, the pension will be paid on a monthly basis or in lump sum.

In 2023 and 2022, the Group recognized pension cost amounting to NT$823 and NT$635, respectively, in accordance with the above regulations governing the recognition of pension fund.

~42~

(XV) Share capital

As of December 31, 2023 and 2022, the Company's authorized capital was NT$1,100,000, which was divided into 110,000 thousand shares and issued in tranches. The paid-in capital was NT$920,000, and the par value was NT$10 per share. The payment for the shares issued by the Company has been received.

(XVI) Capital surplus

According to the requirements of IFRS Questions and Answers, Letter (95) Ji-Mi-Zi No. 081 and Letter (100) Ji-Mi-Zi No. 390 published by the Accounting Research and Development Foundation on October 26, 2018, the acquisition of the Company's shares in Hanlin Development, a subsidiary of the ultimate parent company, is considered an organizational reorganization under common control as described in Note 4, (3) 2. The consideration paid by the Company exceeds the ultimate parent company's book value of the investment under the equity method, and capital surplus-issuance premium shall be adjusted. If the capital surplusissuance premium is insufficient, the retained earnings shall be adjusted down.
According to the Company Act, in addition to the surplus from the issuance of shares in excess of the par value and from the capital surplus from the receipt of gifts, which may be used to make up for losses, the Company shall pay dividends, in which case new shares or cash may be issued, in proportion to the original shares when the Company has no accumulated losses. new shares or cash. In addition, according to the relevant regulations of the Securities and Exchange Act, the total amount of the above-mentioned capital surplus to be appropriated as capital may not exceed 10% of the paid-in capital each year. The Company may not use the surplus reserve to supplement the capital deficit, except when there is insufficient surplus reserve to cover the capital deficit.

	December 31, 2023	December 31, 2022
Treasury stock trading	$ 8,516	$ 8,516
Impact of organizational	30,461	30,461
reorganization
Disposal of equity instruments at	11,286	11,286
FVTOCI by affiliates
Changes in the net equity value of	132,421	132,421
affiliates
Others	170	170
	$ 182,854	$ 182,854

(XVII) Retained earnings

According to the Articles of Incorporation, annual surpluses concluded by the Company are first subject to taxation and making up for previous losses, followed by a 10% provision for legal reserves; however, no further provision is needed when legal reserves have accumulated to the same amount as the Company's paid-in capital. Any surpluses remaining shall then be subject to provision or reversal of special reserves, as the laws. The residual balance (if any) can then be added to undistributed earnings carried from previous years per board resolution, and the shareholder meeting resolved to distribute

~43~

shareholder bonus shares. When dividends are paid in the form of cash, the Board of Directors is authorized to do so with the approval of a majority of directors attending the meeting and at least two-thirds of the directors are present voting to approve the resolution, and the matter shall be reported to the shareholders' meeting.

On June 23, 2022, the shareholders' meeting approved the amendment to the Company's Articles of Association. According to the surplus distribution policy of the Company's Articles of Association, profit distribution or loss compensation can be carried out after the end of each year in accordance with the Company Act. When distributing surplus, it is necessary to estimate and retain tax payables, make up for losses according to law, set legal reserves, and transfer or reverse special reserves in accordance with relevant laws and regulations. When the distribution of earnings in this item is made by issuing new shares, it shall be subject to a resolution of the shareholders' meeting in accordance with Article 240 of the Company Act; if it is distributed in cash, it shall be subject to a resolution of the board of directors.
The Company's dividend distribution policy depends on factors such as the company's current and future investment environment, capital needs, domestic and foreign competition conditions, and capital budgets, taking into account the interests of shareholders, balancing dividends, and the company's long-term financial planning. Dividends shall be distributed in combination, of which cash dividends shall not be less than 20% of the total dividends.
According to the Company Act, the legal reserve shall be contributed until its total amount reaches the total capital. The legal reserve shall not be used except to make up for the company's losses and to issue new shares or cash in proportion to the shareholders' original shares. However, the issuance of new shares or cash shall be limited to the portion of the reserve exceeding 25% of the paid-in capital.
When the Company distributes surplus, according to the laws, the debit balance of other equity items on the balance sheet date of the current year shall be withdrawn as a special reserve for distribution. When the debit balance of other equity items is subsequently reversed, the reversed amount may be included in the distributable surplus.

When adopting IFRSs for the first time, the special surplus reserve was listed in the official letter Jin-Guan-Zheng-Fa-Zi No. 1010012865 issued on April 6, 2012. When the Company subsequently uses, disposes or reclassifies the relevant assets, it will reverse the original proportion of the special reserve.

On June 21, 2023 and June 23, 2022, the shareholders' meeting resolved to distribute surplus for 2022 and 2021 as follows:

	2022 2021 Amount Dividend per share (NT$) Amount Dividends per share (NT$) $ 7,337 $ 15,236 204,188 - 27,600 $ 0.30 18,400 $ 0.20

Legal reserve
Special reserves
Cash dividends

~44~

On March 13, 2024, the Group's 2023 surplus distribution proposed by the board of directors is as follows:

the board of directors is as follows:
		2023
			Dividends
			per share
	Amount			(NT$)
Legal reserve	$	18,375
Reversal of special reserve	(	131,582)
Cash dividends		27,600	$	0.30

The above-mentioned earnings distribution resolved by the Board of Directors and Shareholders' Meeting is available on the “Market Observation Post System” of Taiwan Stock Exchange.

(XVIII) Other equity items

Other equity items
	2023	2022 Unrealized gains or losses on financial assets at FVTOCI ($ 117,229) ( 41,365) ( 65,122) ( 76) 19,604 ($ 204,188)
	Unrealized gains or
	losses on financial assets at FVTOCI
January 1	($ 204,188)
Evaluation adjustment:
-The Group	41,081
-Affiliated enterprises	91,154
Transfer of evaluation
adjustments to retained earnings:
-The Group	( 1,170)
-Affiliated enterprises	517
December 31	($ 72,606)

(XIX) Revenue

Revenue
	2023	2022 $ 502,330 14,780 517,110 52,778 265 $ 570,153
Revenue from customer contracts
Revenue from construction	$ 137,302
projects
Product sales revenue	-
Subtotal	137,302
Lease revenue	61,559
Other operating Income	330
	$ 199,191

The revenue of the Group's customer contracts comes from goods transferred at a certain point in time, or services that are gradually transferred over time. The revenue may be broken down according to the type of operation as follows. Please refer to Note 14 for detailed breakdown of revenue by operating department.

~45~

2023	Constructi	Product sales	Lease	Others	Total
	on projects sales
Time for revenue recognition
Revenue recognized at a point in	$ 137,302	$ -	$ -	$ -	$ 137,302
time
Revenuerecognized overtime	-	-	61,559	330	61,889
	$137,302	$ -	$ 61,559	$ 330	$ 199,191
2022	Constructi	Product sales	Lease	Others	Total
	on projects sales
Time for revenue recognition
Revenue recognized at a point in	$ 502,330	$ 14,780	$ -	$ -	$ 517,110
time
Revenue recognized over time	-	-	52,778	265	53,043
	$ 502,330	$14,780	$ 52,778	$ 265	$ 570,153

For the sales contracts entered into by the Group as of December 31, 2023, the aggregate amount of the transactions amortized from the performance obligations that have not yet been met and the estimated revenue for the year are as follows:

revenue for the year are as follows:
	Amount of contract signed into
The year expected to be recognized as revenue
113~115	$ 1,168,789

3. Contract assets and liabilities

The contractual liabilities related to the contract revenue recognized by the Group are as follows:

	December 31, 2023	December 31, 2022	January 1, 2022

Contract liabilities -
current:
- Advance payment	$ 98,917	$ 1,485	$ 2,804
for land
- Prepaid housing	86,401	30,213	57,374
payment
	$ 185,318	$ 31,698	$ 60,178

(1) The Group's contract for the sale of pre-sale houses contains the terms of advance payment from customers, and the time interval between the time of advance receipt and the transfer of commodity control is longer than one year. Recognize contract liabilities related to pre-sale house contracts according to the requirements of IFRS 15.
(2) Revenue recognized from contract liabilities at the beginning of the year

	2023	2022
Balance of contract
liabilities at the beginning
of the year recognized as
income in current period
Pre-sale contract for	$ 31,698	$ 57,481
construction projects

~46~

(XX) Interest income

(XX)Interest income	Interest income	Interest income
Interest income from financial assets at amortized cost Interest on bank deposit Other interest income (XXI)Other income Dividend income Other income-others (XXII) Other gains and losses Foreign exchange gain Losses on financial assets at fair value through profit or loss Disposal of investment gains Impairment losses on investments using the equity method Other gains and losses	Interest income from financial assets at amortized cost Interest on bank deposit Other interest income Other income			2023	2022
					$ 186 2,097 1,455
				$ 1,331
				4,417
				-
				$ 5,748	$ 3,738
					2022 $ 3,354 7,647 $ 11,001 2022 $ 2,835 - - ( 46,403) ( 4,940) ($ 48,508)
				2023
	Dividend income			$ 3,381
	Other income-others			4,939
				$ 8,320
		Other gains and losses

				2023
		Foreign exchange gain	($ 54)
		Losses on financial	( 1,535)
		assets at fair value
		through profit or loss
		Disposal of investment	665
		gains
		Impairment losses on	-
		investments using the
		equity method
		Other gains and losses	( 558)
			($ 1,482)

(XXIII) Financial cost

Financial cost
	2023	2022 $ 24,445 435 2,376 177 27,433 ( 15,769) $ 11,664
Interest expense
Bank loans	$ 44,349
Short-term notes	290
payable
Interest on lease
liabilities	2,349
Others	18
	47,006
Less: Amount of	( 33,539)
capitalized assets that meet the criteria
	$ 13,467

(XXIV) Additional Information on Nature of Expenses

	2023 Attributable to operating costs Attributable to operating expenses Total $ - $ 30,181 $ 30,181 18,154 3,582 21,736 $ 18,154 $ 33,763 $ 51,917

Employee welfare
expenses
Depreciation expense

~47~

		2022
	Attributable to operating costs	Attributable to operating expenses
Employee welfare expenses	$ -	$ 21,577
Depreciation expense	18,157	3,506
	$ 18,157	$ 25,083

(XXV) Employee welfare expenses

	2023	2022
Salary expenses	$ 16,889	$ 10,903
Labor and health insurance premiums
	1,414	1,140
Pension expense	823	635
Director Compensation	9,602	8,129
Other employee expenses	1,453	770
	$ 30,181	$ 21,577

According to the Company's Articles of Incorporation, the Company shall appropriate 0.5%~5% of the balance as the remuneration to employees, and no more than 0.2% to the remuneration to Directors, after deducting the accumulated losses based on the current profit status of the Company.
The remuneration to employees was estimated at NT$955 and NT$628 in 2023 and 2022, respectively; the remuneration to directors was estimated at NT$935 and NT$559.

The remuneration of employees and remuneration of directors 2023 is estimated according to the profits of the current period and in accordance with the Articles of Incorporation.

As resolved by the Board of Directors, the remuneration to employees and directors for 2022 is consistent with the recognized amounts in the 2022 financial statements.

Information on remuneration to employees and directors approved by the Company's Board of Directors is available on the Market Observation Post System.

(XXVI) Income Tax

Income tax expenses

Components of income tax expense:

~48~

2023 2022 Current income tax: Income tax on current income $ 1,058 $ 7,028 Additional tax on undistributed earnings 2,624 7,773 (Over) Underestimation of income tax in previous years ( 97) 40 Land appreciation tax included in current income tax 580 812 Total income tax for the period 4,165 15,653 Deferred income tax: The original generation and reversal of temporary difference ( 9) 2,791 Totaldeferredincome tax ($ 9) $ 2,791 Income tax expenses $ 4,156 $ 18,444 Relationship between income tax expenses and accounting profit 2023 2022 Income tax on net profit before tax calculated at statutory tax rate $ 43,125 $ 48,023 Losses to be removed in accordance with the tax law ( 2,945) - Income exempted from taxation under the Tax Act ( 83,390) ( 44,914) Additional tax on undistributed earnings 2,624 7,773 Deferred income tax assets for unrecognized taxation losses 44,259 6,710 Underestimation of income tax in previous years ( 97) 40 Land appreciation tax included in current income tax 580 812 Income tax expenses $ 4,156 $ 18,444	2023 2022 Current income tax: Income tax on current income $ 1,058 $ 7,028 Additional tax on undistributed earnings 2,624 7,773 (Over) Underestimation of income tax in previous years ( 97) 40 Land appreciation tax included in current income tax 580 812 Total income tax for the period 4,165 15,653 Deferred income tax: The original generation and reversal of temporary difference ( 9) 2,791 Totaldeferredincome tax ($ 9) $ 2,791 Income tax expenses $ 4,156 $ 18,444 Relationship between income tax expenses and accounting profit 2023 2022 Income tax on net profit before tax calculated at statutory tax rate $ 43,125 $ 48,023 Losses to be removed in accordance with the tax law ( 2,945) - Income exempted from taxation under the Tax Act ( 83,390) ( 44,914) Additional tax on undistributed earnings 2,624 7,773 Deferred income tax assets for unrecognized taxation losses 44,259 6,710 Underestimation of income tax in previous years ( 97) 40 Land appreciation tax included in current income tax 580 812 Income tax expenses $ 4,156 $ 18,444	2023 2022 Current income tax: Income tax on current income $ 1,058 $ 7,028 Additional tax on undistributed earnings 2,624 7,773 (Over) Underestimation of income tax in previous years ( 97) 40 Land appreciation tax included in current income tax 580 812 Total income tax for the period 4,165 15,653 Deferred income tax: The original generation and reversal of temporary difference ( 9) 2,791 Totaldeferredincome tax ($ 9) $ 2,791 Income tax expenses $ 4,156 $ 18,444 Relationship between income tax expenses and accounting profit 2023 2022 Income tax on net profit before tax calculated at statutory tax rate $ 43,125 $ 48,023 Losses to be removed in accordance with the tax law ( 2,945) - Income exempted from taxation under the Tax Act ( 83,390) ( 44,914) Additional tax on undistributed earnings 2,624 7,773 Deferred income tax assets for unrecognized taxation losses 44,259 6,710 Underestimation of income tax in previous years ( 97) 40 Land appreciation tax included in current income tax 580 812 Income tax expenses $ 4,156 $ 18,444
	2023
Income tax on net profit before tax
calculated at statutory tax rate	$ 43,125
Losses to be removed in accordance	( 2,945)
with the tax law
Income exempted from taxation under
the Tax Act	( 83,390)
Additional tax on undistributed
earnings	2,624
Deferred income tax assets for
unrecognized taxation losses	44,259
Underestimation of income tax in	( 97)
previous years
Land appreciation tax included in
current income tax	580
Income tax expenses	$ 4,156	$ 18,444

Relationship between income tax expenses and accounting profit
The amounts of deferred income tax assets or liabilities arising from temporary differences are as follows:

~49~

		2023	2023
		Recognized in profit or loss	Recognized in other comprehensi ve net income
				December
	January 1			31
Deferred income tax assets
Unrealized exchange loss	$ -	$ 5	$ -	$ 5
Impairment loss of
investment property	338	-	-	338
	$ 338	$ 5	$ -	$ 343
Deferred income tax liabilities
Unrealized exchange gain	(511)	4	-	( 507)
	($ 173)	$ 9	$ -	($ 164)

				2022
			Recognized
		Recognized in profit or loss	in other comprehensi ve net income
				December
	January 1			31
Deferred income tax assets
Unrealized expenses	$ 2,236	($ 2,236)	$ -	$ -
Unrealized exchange loss	57	( 57)	-	-
Impairment loss of
investment property	338	-	-	338
	$ 2,631	($ 2,293)	$ -	$ 338
Deferred income tax liabilities
Unrealized exchange gain	-	( 511)	-	( 511)
Gains on valuation of

financial assets	( 13)	13	-	-

	($ 13)	($ 498)	$ -	($ 511)
	$2,618	($ 2,791)	$ -	($ 173)

The effective periods of the Group’s unused tax losses and the related amounts of unrecognized deferred income tax assets are as follows:

			December 31, 2023	December 31, 2023	December 31, 2023
						Amount of
Year of		Amount			unrecognized
occurrenc	reported/authoriz		Amount yet to		deferred income		Last crediting
e		ed		be offset		tax assets	year
2018	$	59,130	$	24,080	$	24,080	2028
2020		37,594		37,594		37,594	2030
2021		26,178		26,178		26,178	2031
2022		33,276		33,276		33,276	2032
2023		217,483		217,483		217,483	2033
	$	373,661	$	338,611	$	338,611

December 31, 2022

	Amount yet to be offset	Amount of	Amount of
Amount
reported/authoriz
ed
$ 59,130	$ 24,080	$ 24,080	2028
37,594	37,594	37,594	2030
26,178	26,178	26,178	2031
33,276	33,276	33,276	2032
$ 156,178	$ 121,128	$ 121,128

~50~

Deductible temporary differences not recognized as deferred income tax assets

tax assets
	December 31, 2023	December 31, 2022
Deductible temporary		$ 121,221
difference	$ 338,704

The income tax for the profit-seeking business of the Company has been approved by the tax collection authority up to 2021.

(XXVII) Earnings per share

Earnings per share
		2023
		Weighted average	Earnings per share (NT$)
	After-tax amount	outstanding shares (thousand shares)
Basic earnings per share
Net income attributable to common stock	$ 184,402	92,000	$ 2.00
shareholders of the parent company
Diluted earnings per share
Net income attributable to common stock
shareholders of the parent company
Owner of parent company	$ 184,402	92,000	$ 2.00
Effect of potential dilutive common stock
Employee remuneration	-	63
Net income attributable to common	$ 184,402	$ 92,063	$ 2.00
shareholders of the parent company plus effect of potential common shares
		2022
		Weighted average	Earnings per share (NT$)
	After-tax amount	outstanding shares (thousand shares)
Basic earnings per share
Net income attributable to common stock
shareholders of the parent company
Owner of parent company	$ 92,205	92,000	$ 1.00
Equity owned by the previous holder	13,190	-	0.14
under the joint control
Net income attributable to common	$ 105,395	92,000	$ 1.14
shareholders
Diluted earnings per share
Net income attributable to common stock
shareholders of the parent company
Owner of parent company	$ 92,205	92,000	$ 1.00
Equity owned by the previous holder	13,190	-	0.14
under the joint control
Effect of potential dilutive common stock
Employee remuneration	-	-
Net income attributable to common	$ 105,395	92,000	$ 1.14
shareholders of the parent company plus effect of potential common shares

~51~

(XXVIII) Organizational reorganization

In order to integrate and enhance the development resources for the rental and sale business and real estate business, on August 10, 2022, the Board of Directors resolved to acquire a 33% equity of Hanlin Development from the ultimate parent company, Hanshin Asset Management Co., Ltd. The business scope is investment in real estate, residential building. On August 26, 2022, the Board of Directors of Hanlin Development was elected by the interim extraordinary meeting and obtained a majority of the seats, gained control.
Therefore, the equity transaction is a reorganization under common control, and the book value method was adopted for the accounting treatment. The consideration paid and the book value of the net assets acquired by Hanlin Development on the transaction base date are as follows:

follows:
Acquisition cost	$ 231,000 ( 261,461) ($ 30,461)
Less: Book value of net assets acquired
Difference: Adjusted additional paid-in capital

As of August 26, 2023, the Company recognized a balance of NT$261,461 in “equity owned by the previous holder under the joint control” attributable to Hanshin Asset Management Co., Ltd. This amount was written off upon completion of the above transaction.

(XXIX) Changes in liabilities from financing activities

			2023	2023
		Short-	Lease liabilities Long- term borrowing s	Long-	Deposit
		term			s receive d	Total liabilities
	Short-term	notes				from financing
	borrowings	payable				activities
January 1	$1,318,925	$ 28,762	$ 127,003	$ 406,000	$ 6,942	$ 1,887,632
Changes in cash			( 2,627) ( 16,000)		1,755
flow from
financing	43,876	( 28,762)				( 1,758)
Interest expenses			( 2,349) -		-
	-	-
paid (Note)						( 2,349)

Other non-cash			3,633 -		-
	-	-
changes						3,633

December 31	$1,362,801	$ -	$ 125,660	$390,000	$ 8,697	$ 1,887,158

			2022
		Short-	Lease liabilities	Long-	Deposit
		term		term	s receive d	Total liabilities
	Short-term	notes		borrowing		from financing
	borrowings	payable		s		activities
January 1	$ 675,368	$ 141,858	$ 122,840	$ 418,000	$ 7,159	$ 1,365,225
Changes in cash			( 1,619)		( 217)
flow from
financing	643,557	(113,096)		( 12,000)		516,625
Interest expenses			( 2,376)		-
	-	-		-
paid (Note)						( 2,376)

Other non-cash			8,158		-
	-	-		-
changes						8,158

December 31	$1,318,925	$ 28,762	$ 127,003	$ 406,000	$ 6,942	$ 1,887,632

Note: Cash flow from operating activities is presented in the table.

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VII. Related party transactions

(I) Names of related parties and their relationship

Name of related party	Relationship with the Group
Hanshin Asset Management Co., Ltd.	The Company's ultimate parent company
Hanshin Department Store Co., Ltd. (Hanshin
Department Store)	Other related parties
Liyang Agricultural Technology Co., Ltd. (Liyang
Agricultural Technology)	Other related parties
Hanshin Investment Co., Ltd. (Hanshin
Investment)	Other related parties
Huadi Asset Management Co., Ltd. (Huadi
Asset)	Other related parties
Grand Hi-Lai Hotel Co., Ltd. (Grand Hi-Lai
Hotel)	Other related parties
Hi-Lai Foods Co., Ltd. (Hi-Lai Foods)	Other related parties
Weili International Development Co., Ltd. (Weili
International)	Other related parties
Hanqi Technology Co., Ltd.	Other related parties
Kuo Yang Construction Co., Ltd.	Other related parties
Shenyang Construction Co., Ltd.	Other related parties
Zu Sheng International Co., Ltd.	Other related parties
Hanshin Shopping Plaza Co., Ltd.	Other related parties
KUO HSIEH CORPORATION	Other related parties
Xue Yong Co., Ltd.	Other related parties

(II) Material transactions with related parties

1. Administrative expenses

Administrative expenses
	2023	2022 $ 2,316 23 $ 2,339
Ultimate parent company	$ 2,319
Other related party - Hanshin	23
Department Store Co., Ltd.
	$ 2,342

The Group signs lease contracts with related parties based on general market conditions, and rents are paid within the periods agreed in the contracts.

2. Entertainment expenses

Entertainment expenses
	2023	2022 $ 303 65 - $ 368
Other related party - Hi-Lai Foods	$ 303
Other related parties - Grand Hi-Lai Hotel	9
Other related party - Hanshin Department Store Co., Ltd.	9
	$ 321

The Group's entertainment expenses are mainly gifts given to customers, and the payment terms to related parties are “paid when incurred”.

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3. Accounts receivable

Accounts receivable
	December 31, 2023	December 31, 2022 $ 377
Ultimate parent company	$ 377

4. Deposits received

Deposits received
	December 31, 2023	December 31, 2022 $ 404 December 31, 2022 $ 9,769
Ultimate parent company	$ 404
Accounts payable
	December 31, 2023
Ultimate parent company	$ 9,769

5. Accounts payable

6. Loans to related parties (2023: None)

On December 31, 2022, the balance of loans to related parties was NT$0. Interest income

Interest income
	2022 $ 39 6 92 1,319 $ 1,456
Ultimate parent company
Other related parties - Liyang Agricultural Technology Co.,
Ltd.
Other related party - Huadi Asset Management Co., Ltd.
Other related party-Hanshin Investment Co., Ltd.

7. Endorsements and guarantees provided to related parties

	December 31, 2023	December 31, 2022 $ 811,834
Other related party-WEINIG	$ 1,003,000
International

8. Others

(1) On July 15, 2021, the Company entered into a joint investment and development contract with Weili International Development Co., Ltd., Guo Yang Construction Co., Ltd., Hanshin Asset Management Co., Ltd., and Grand Hi-Lai Hotel Co., Ltd. for 9 pieces of land including No. 28, Zhongxing Section, Sanchong District, with a total area of 1,828.28 pings, with Guo Yang Construction Co., Ltd. acting as the manager of the project according to the contract. The investment ratio was 15% by the Company, 10% by Weili International Development Co., Ltd., 50% by Guo Yang Construction Co., Ltd., 10% by Hanshin Asset Management Co., Ltd., and 15% by Grand Hi-Lai Hotel Co., Ltd.
(2) On November 23, 2020, the Company entered into a joint investment and development contract with Weili International Development Co., Ltd., Guo Yang Construction Co., Ltd., Hanshin Asset Management Co., Ltd., Liyang Agricultural Technology Co., Ltd. and Grand Hi-Lai Hotel Co., Ltd. for 4 pieces of land including 83-1, Jiuzong Section, Neihu District, Taipei City, with a total area of 2,127.33 pings. Guo Yang Construction

~54~

Co., Ltd. was the manager of the project according to the contract. 10% of the investment was by the Company, 50% by Guo Yang Construction Co., Ltd., and 10% by all other companies.

(3) On January 28, 2021, the Company entered into a joint investment and development contract with Weili International Development Co., Ltd., Guo Yang Construction Co., Ltd., Hanshin Asset Management Co., Ltd., Liyang Agricultural Technology Co., Ltd. and Grand Hi-Lai Hotel Co., Ltd. for 19 pieces of land including Lot No. 365, Zhongyi Section, Tucheng District, New Taipei City, with a total area of 5,344.27 pings. Guo Yang Construction Co., Ltd. was the manager of the project according to the contract. 10% of the investment was by the Company, 50% by Guo Yang Construction Co., Ltd., and 10% by all other companies. Subsequently, on June 29, 2021, “Grand Hi-Lai Hotel Co., Ltd.” withdrew from the project. The original holding ratio was changed to Hanshin Asset Management Co., Ltd. effective on July 1, 2021.
(4) On June 29, 2012, Guo Yang Construction Co., Ltd. and Weili International Development Co., Ltd. signed a joint investment and development agreement for joint development and construction of a residential complex on the land held by Taiwan Sugar Corporation at Lot 24, Hetuan Section, Annan District, Tainan City (77,479.53 square meters). Subsequently, a management letter was signed, which entrusted Guo Yang Construction Co., Ltd. to take charge of the overall development plan, architectural planning, construction and sales of collective housing. Weili International Development Co., Ltd. is the representative of the project and executed the Project in accordance with the contract signed with Taiwan Sugar Corporation, and acted as the organizer of the Project, coordinating as the selling company (issuing sales invoices) for the sale of premises and as the purchasing company (issuing certificates) for the purchase of goods or services, and is responsible for the settlement of the Project. Subsequently, the “Joint Development Supplementary Agreement” was signed on March 15, 2016 to change the capital contribution and settlement distribution ratio to the Company's subsidiaries. After change, the ratios of Hanlin Development, Weili International Development Co., Ltd., Feminine Co., Ltd., Zu Sheng International Co., Hanshin Asset Management Co., Ltd., Crowell Development Corp., and Kuo Yang Construction Co., Ltd. were 5%, 6%, 1.5%, 4%, 13.5%, 10%, and 60%, respectively. Subsequently, Crowell Development Corp. withdrew from the project on July 15, 2019. The “Joint Development Supplementary Agreement” was signed on with Weili International Development Co., Ltd. to change the capital contribution and settlement distribution ratio to the Company's subsidiaries. After change, the ratios of Hanlin Development, Weili International Development Co., Ltd., Feminine Co., Ltd., Zu Sheng International Co., Hanshin Asset Management Co., Ltd., and Kuo Yang Construction Co., Ltd. were 10%, 6%, 1.5%, 4%, 13.5%, and 65%, respectively.
(5) On August 11, 2022, the Company and its subsidiary, Hanlin Development Co., Ltd., entered into a joint investment and development contract with Guo Yang Construction Co., Ltd., Weili International Development Co., Ltd., and Shenyang Construction Co., Ltd. for 12 pieces of land, with an area of 2,259,85 pings, including Lot 258,

~55~

Zhongyuan Section, Zhonghe District, New Taipei City. Its investment ratio includes the Company (40%), Hanlin Development (10%), Shenyang Construction Co., Ltd. (40%), and Weili International Development Co., Ltd. (10%).

(6) On July 4, 2022, the Company’s subsidiary, Hanlin Development Co., Ltd., entered into a joint investment contract with Weili International Development Co., Ltd., Guo Yang Construction Co., Ltd., Grand Hi-Lai Hotel Co., Ltd., Hanshin Asset Management Co., Ltd., and Grand Hi-Lai Hotel Co., Ltd., and Hanshin Shopping Plaza Co., Ltd. for 29 pieces of land including Lot 895, Jiangbei Section, Shih Chi District, New Taipei City, with a total area of 5,531.35 pings, with Guo Yang Construction Co., Ltd. acting as the manager of the project according to the contract. The investment ratio was 10% by Hanlin Development Co., Ltd., 50% by Guo Yang Construction Co., Ltd., 20% by Weili International Development Co., Ltd., 10% by Grand Hi-Lai Hotel Co., Ltd., and 10% by Hanshin Shopping Plaza Co., Ltd.
(7) On June 3, 2016, the Company's subsidiary, Hanlin Development, entered into a joint investment and development contract with Shenyang Construction Co., Ltd. for the land rights for 5 pieces of land, including No. 1492 of Shengxing Section, Qianzhen District, Kaohsiung City, with an area of 11,411 square meters. Its investment ratio is 30% by Hanlin Development and 70% by Shenyang Construction Co., Ltd.
(8) On April 15, 2019, the Company's subsidiary, Hanlin Development, entered into a joint investment and development contract with Weili International Development Co., Ltd., Liyang Agricultural Technology Co., Ltd., Goldshare Investment Corporation, Xueyong Co., Ltd., and Jinzan Industrial Co., Ltd. for 6 pieces of land, including 33, 34, 35-1, 36, 39 and 42 in Baoyuan Section, Xindian District, New Taipei City., with an area of 1,332 pings. The investment ratio was 20% by Hanlin Development Co., Ltd., 20% by Weili International Development Co., Ltd., 25% by Liyang Agricultural Technology Co., Ltd., 15% by Goldshare Investment Corporation, 15% by Xueyong Co., Ltd., and 5% by Jinzan Industrial Co., Ltd.

(III) Remuneration of key management personnel

	2023	2022 $ 10,331
Short-term employee benefits	$ 11,835

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VIII. Assets collateralized (pledged)

The details of collateral for the Group's assets are as follows:

	Book value	Book value
	December 31, 2023	Purpose of
Assets		December 31, 2022 guarantee
		Short-term
Inventory	$ 1,970,613	borrowings and $ 1,825,985
		short-term notes
Other financial assets -	69,961	payable Performance bond, reserves 96
current (time deposits and
restricted deposits)
Investment property	619,319	account and trust 635,406
Other financial assets - non-	13,000	deposit account Long-term borrowings 4,766
current (time deposits and
restricted deposits)
		Performance
	$ 2,672,893	bond and provisions account $ 2,466,253

IX. Significant contingent liabilities or unrecognized contractual commitments

As of December 31, 2023, the total cost of construction contracts entered into between the Group and non-related parties amounted to NT$673,701, and the amount signed but yet to be paid amounted to NT$524,273.

X. Losses from major disasters

None.

XI. Subsequent events

On February 26, 2024, as resolved by the Board of Directors, the Company acquired 12,600 thousand shares of common stock from Hanlin Development Co., Ltd. from Hanshin Asset Management Co., Ltd. for NT$132,300 thousand. On March 11, 2024, the share transfer was completed, and the Company's shareholding was increased from 33% to 51%.

XII. Others

(I) Capital management

The Group's capital management objective is to maintain a sound credit rating and a good capital ratio to support corporate operations and maximize shareholders' equity. The Group manages and adjusts the capital structure according to the economic situation, and may achieve the purpose of maintaining and adjusting the capital structure by adjusting the payment of dividends, returning capital or issuing new shares.

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(II) Financial instruments

1. Types of financial instruments

ancial instruments Types of financial instruments
	December 31, 2023	December 31, 2022 $ 86,000 $ 148,906 $ 521,760 80,000 19,613 6,439 24,346 96 10,139 4,766 $ 667,159 December 31, 2022 $ 1,318,925 28,762 12,066 24,801 29,914 6,942 $ 1,421,410 $ 127,003
Financial assets
Financial assets at FVTPL
Financial assets mandatorily at	$ 117,625
FVTPL
Financial assets at FVTOCI
Investment in designated equity	$ 170,784
instruments
Financial assets at amortized cost
Cash and cash equivalents	$ 605,103
Financial assets at amortized	20,000
cost
Notes receivable	27,668
Accounts receivable (including	7,491
related parties)
Other receivables	9,548
Other financial assets - current	69,961
Deposits received	10,143
Other financial assets - non-	13,000
current
	$ 762,914

	December 31, 2023

Financial liabilities
Financial liabilities at amortized
cost
Short-term borrowings	$ 1,362,801
Short-term notes payable	-
Notes payable	43,792
Accounts payable (including	28,097
related parties)
Other payables	37,645
Deposits received	8,697
	$ 1,481,032
Lease liabilities	$ 125,660

2. Risk management policy

(1) The Group's financial risk management objectives are mainly to manage market risks, credit risks and liquidity risks related to operating activities. The Group identifies, measures and manages the aforementioned risks in accordance with the Group's policies and risk preferences.
(2) The Group has established appropriate policies, procedures, and internal controls for the aforementioned financial risk management in accordance with relevant regulations, and important financial activities must be reviewed by the board of directors in accordance with relevant regulations and internal controls. During the execution of financial management activities, the Group shall faithfully comply with the relevant regulations on financial risk management.
(3) The Group has not undertaken derivatives to avoid financial risks.

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3. Nature and extent of material financial risks

(1) Market risk

Interest rate risk

A. The Group is exposed to exchange rate risks arising from transactions that are relatively different from the functional currencies of the Company and its subsidiaries, mainly in USD. The associated exchange rate risk arises from future commercial trades and recognized assets and liabilities.
B. The management of the Group has established a policy requiring each company within the Group to manage the exchange rate risk relative to its functional currency.
C. The business of the Group involves non-functional currency (the functional currency of the Company and its subsidiaries is NT$), so it is affected by exchange rate fluctuations, and the foreign currency assets and liabilities with significant exchange rate fluctuations are as follows:

follows:
	December 31,		2023
	Foreign
(Foreign currency: Functional	currency (in	Exchange	Book value
currency)	thousand)	rate		(NT$ )
Financial assets
Monetary items
USD: NT$	$ 1,025	30.71	$	31,464
	December 31,		2022
	Foreign
(Foreign currency: Functional	currency (in	Exchange	Book amount
currency)	thousand)	rate		(NT$)
Financial assets
Monetary items
USD: NT$	$ 945	30.71	$	29,016

D. The Group's monetary items have a significant impact due to exchange rate fluctuations. The total amount of all exchange (losses) benefits recognized in 2023 and 2022 (including realized and unrealized) were (NT$54) and NT$2,835, respectively.
E. The Group’s foreign currency market risk analysis due to major exchange rate fluctuations is as follows:

The exchange risk between USD and NT$ mainly comes from US dollar-denominated cash and equivalent cash, resulting in foreign currency exchange losses or gains during conversion. If holding NT$ against USD depreciates or appreciates by 1% and all other factors remain unchanged, the net profit in 2023 and 2022 will increase or decrease by NT$252 and NT$232 respectively.

Price risk

A. The equity instruments that the Group is exposed to price risk are financial assets held at FVTPL and financial assets at FVTOCI. In order to manage the price risk of equity instrument investment, the Group manages the price risk of equity securities by diversifying

~59~

investment and setting limits for single and overall equity investment. The information on investment portfolio of equity securities needs to be regularly provided to the senior management of the Company, and the board of directors must review all equity securities investment decisions and approve the diversification of its investment portfolio.

B. The Group mainly invests in equity instruments issued by domestic companies and joint development projects. The prices of these equity instruments and contracts will be affected by the uncertainty of the future value of the investment target. If the value of these equity instruments and joint development projects increases or decreases by 1%, and all other factors remain unchanged, the after-tax net profit in 2023 and 2022 comes from equity instruments at FVTPL and The gain or loss on the joint development project will increase or decrease by NT$1,176 and NT$860 respectively; the gain or loss on equity investments classified as FVTOCI will increase or decrease by NT$1,708 and NT$1,489 respectively.

Cash flow and fair value interest rate risk

A. The Group's interest rate risk mainly comes from short-term loans issued at floating rates, and long-term loans, which expose the Group to cash flow interest rate risk. In 2023 and 2022, the Group's loans issued at floating rates were mainly denominated in NT$.
B. When the NT dollar loan interest rate increases or decreases by 1%, and all other factors remain unchanged, the after-tax net profit in 2023 and 2022 will decrease or increase by NT$14,022 and NT$14,029 respectively, mainly due to floating rate loans The interest expense changes accordingly.

(2) Credit risk

A. The credit risk of the Group is the risk of financial loss of the Group due to the inability of the customer or the counterparty of the financial instrument to perform the contractual obligations, which mainly arises from the inability of the counterparty to settle the receivables paid on collection terms and the contractual cash flows classified as investments in debt instruments at amortized cost.
B. Each unit of the Group follows credit risk policies, procedures and controls to manage credit risk. The credit risk assessment of all customers is based on comprehensive consideration of the customer's financial status, credit rating agency ratings, past historical transaction experience, current economic environment, and the Group's internal rating standards and other factors.
C. The Group's Finance and Accounting Department manages the credit risks of bank deposits, fixed-income securities and other financial instruments in accordance with the Group's policies. Because the Group's transaction partners are determined by internal controls procedures, and they are banks with good credit, financial institutions, corporate organizations and government agencies with investment grades, and hence there is no significant credit risk.
D. The Group is mainly engages in the leasing and selling of residential buildings, industrial plants and commercial buildings. The sale of

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premises is recognized as revenue when the contract price is fully collected and the ownership transfer is completed and the actual house is handed over. Hence, the amount of accounts receivable arising from the sale of premises should be small, and the risk of irrecoverability is minor for notes receivable. The amount of credit impairment assessed to the Group as of December 31, 2023 and 2022, was insignificant. In addition, for the accounts receivable arising from other transactions, the Group shall manage the credit risk. When the contract payment is overdue for more than 90 days according to the agreed payment terms, it shall be deemed as a breach of contract.

E. The Group adopts the presumption provided by IFRS 9. When the contract payment is overdue for more than 30 days according to the agreed payment terms, it is considered that the credit risk of the financial asset has increased significantly since the original recognition.
F. When the Group assesses that the financial assets cannot be reasonably expected to be recovered (for example, the issuer or the debtor has significant financial difficulties, or has gone bankrupt), it will be written off.
G. The Group categorizes customers' accounts receivable according to factors such as counterparty's credit rating, region and industry, and uses a simplified method to estimate expected credit losses based on the provision matrix. Relevant information is as follows:

		Not	Overdue 1-	Overdue 1-	Overdue 31-	Overdue 31-	Overdue 61-	Overdue 61-
	overdue		30 days		60 days		90 days			Total
December 31,
2023
Expected rate of		0%
loss
Total book value	$	7,114	$	-	$	-	$	-	$	7,114
Allowance for	$	-	$	-	$	-	$	-	$	-
losses
		Not	Overdue 1-		Overdue 31-		Overdue 61-
	overdue		30 days		60 days		90 days			Total
December 31,
2022
Expected rate of
loss		0%
Total book value	$	6,062	$	-	$	-	$	-	$	6,062
Allowance for
losses	$	-	$	-	$	-	$	-	$	-

(3) Liquidity risk

A. Cash flow forecasting is performed by each operating entity within the Group and summarized by the Group's finance department. The Group’s finance department monitors the forecast of the Group's liquidity needs to ensure that it has sufficient funds to meet operating needs and maintain sufficient unused loan commitments at any time, so that the Group will not violate the relevant loaning limit or terms. These forecasts take into account the group's debt financing plan,

~61~

compliance with debt terms, and financial ratio targets in line with the internal balance sheet.

B. The Group invests the remaining funds in interest-bearing demand deposits, time deposits and securities, and the instruments it chooses have appropriate maturity dates or sufficient liquidity to respond to the above forecasts and provide sufficient dispatch levels.
C. The Company's unused loan is as follows:

	December 31, 2023	December 31, 2022 $ 232,993
Floating interest rate
Overdue in more	$ 389,597
than one year

D. The following table categorizes the Group's non-derivative financial liabilities according to the relevant maturity date, and analyzes based on the remaining period from the balance sheet date to the contractual maturity date. Except for notes payable, accounts payable, (including related parties), other payables, and deposits, the undiscounted contractual cash flow amount is approximately equivalent to its book value and is due within one year. The undiscounted contractual cash flow amounts of the remaining financial liabilities are detailed in the table below:

	Within 1	Within 1				3 years or
December 31, 2023		year	1-2 years		2-3 years	above
Short-term borrowings	$	35,155	$	305,431	$ 347,042	$ 808,879
Lease liabilities		5,000		4,960	4,592	160,978
Long-term loans
(including due within
one year)		24,610		24,250	23,890	259,163
	Within 1					3 years or
December 31, 2022		year	1-2 years		2-3 years	above
Short-term borrowings	$	128,843	$	29,816	$ 290,913	$1,005,007
Short-term notes
payable		28,800		-	-	-
Lease liabilities		4,630		4,524	4,524	165,502
Long-term loans
(including due within
one year)		24,472		24,132	23,792	428,617

E. The Group does not expect that the cash flow in the due date analysis will occur significantly earlier, or the actual amount will be significantly different.

(III) Fair Value Information

The definitions of the various levels of evaluation techniques adopted to measure the fair value of financial and non-financial instruments are as follows:

Level 1: Quoted prices (unadjusted) in an active market for the same assets or liabilities available to the enterprise on the measurement date. An active market is one in which transactions in assets or liabilities occur with sufficient frequency and volume to provide pricing information on an ongoing basis. The fair value of the listed/OTC stock invested by the Group belongs

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to this category.

Level 2: Observable inputs, directly or indirectly, for assets or liabilities other than quoted prices included in Level 1.

Level 3: Unobservable inputs to assets or liabilities. The Group's investments in joint development projects without an active market belong to this category.

For information on the fair value of investment real estate at cost, please refer to Note 6(10).
Financial instruments not measured by fair value

The Group's cash and cash equivalents, financial assets at amortized cost, notes receivable, accounts receivable (including related parties), other receivables, deposits, short-term loans, The book amounts of short-term bills payable, bills payable, accounts payable (including related parties), other payables, deposits and long-term loans are reasonable approximations of fair values.

Financial and non-financial instruments measured by fair value are classified by the Group based on the nature, characteristics and risks of assets and liabilities and the basis of fair value levels. The relevant information is as follows:
(1) The Group classifies them according to the nature of assets and liabilities, and the relevant information is as follows:

December 31, 2023	Level 1	Level 2	Level 3
Assets
Recurring fair value
Financial assets at
FVTPL
Equity securities	$ 31,625	$ -	$ -
Joint investment and	-	-	86,000
development contract
Subtotal	31,625	-	86,000
Financial assets at
FVTOCI
Equity securities	170,784	-	-
	$ 202,409	$ -	$ 86,000
December 31, 2022	Level 1	Level 2	Level 3
Assets
Recurring fair value
Financial assets at
FVTPL
Joint investment and	$ -	$ -	$ 86,000
development contract
Financial assets at
FVTOCI
Equity securities	148,906	-	-
	$ 148,906	$ -	$ 86,000

(2) The methods and assumptions used by the Group to measure the fair value are as follows:
A. The Group adopts the market quotation as the input value of fair

~63~

value (i.e., Level 1), and the characteristics of the instruments are as follows:

Listed (OTC) stock Market quotation Closing price

B. Except for the above-mentioned financial instruments with active markets, the fair value of other financial instruments is obtained by evaluation techniques or by referring to the quotations of counterparties. The fair value obtained through valuation techniques can be calculated referring to the current fair value of other financial instruments with substantially similar conditions and characteristics, discounted cash flow method or other valuation techniques, including the use of market information available on the consolidated balance sheet date.
C. When evaluating non-standardized and less complex financial instruments, such as joint development projects, the Group adopts evaluation techniques widely used by market participants. The parameters adopted in the evaluation models of such financial instruments are usually market observable information.
The Group did not have any transfer between the Levels 1 and 2 in 2023 and 2022.
The following table shows that there was no transfer in and transfer out of Level 3 in 2023 and 2022.
The Group is responsible for verifying the fair value of financial instruments, using independent source data to make the evaluation results close to the market status, confirming that the data source is independent, reliable, and other data sources Consistent and representative executable prices, and regularly calibrate the evaluation model, conduct backtesting, update the input values and data required for the evaluation model, and make any other necessary fair value adjustments to ensure that the evaluation results are reasonable.
The quantitative information of the significant unobservable input value and the sensitivity analysis of the change of the significant unobservable input value of the evaluation model used for the third-level fair value measurement items are as follows:

						Relationship
			Evaluati	Unobservab		between
	Fair	value on	on	le	Interval	input value
	December 31,		techniqu	significant	(weighted	and fair
		2023	e	input	average)	value
Non-derivative
equity instruments:
Joint investment and development contract	$	86,000	Net asset approac h	Not applicable	-	Not applicable
						Relationship
			Evaluati	Unobservab		between
	Fair	value on	on	le	Interval	input value
	December 31,		techniqu	significant	(weighted	and fair
		2022	e	input	average)	value

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Non-derivative
equity instruments:
			Net
Joint investment			asset
and development			approac	Not	-	Not
contract	$	86,000	h	applicable		applicable

XIII. Other disclosures

(I) Information about important transactions

Loans to others: None.
Endorsements/guarantees provided for others: Please refer to Table 1.
Marketable securities held at the end of the period (excluding investments in subsidiaries, affiliates, and jointly controlled companies): Please refer to Table 2.
Accumulated purchase or sale of the same marketable securities for an amount exceeding NT$300 million or 20% of the paid-in capital: None.
Acquisition amount of real estate reaching NT$300 million or more than 20%
of the paid-in capital: None.
Disposal of real estate reaching NT$300 million or 20% of paid-in capital or more: None.
Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of paid-in capital or more: None.
Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more: None.
Engagement in derivatives transactions: None.
The business relationship between the parent company and its subsidiaries, and the status and amount of important transactions between each subsidiary: None.

(II) Information on invested businesses

The name and location of the investee company and other relevant information (excluding mainland China investee companies): Please refer to Table 3.

(III) Investment information in Mainland China

Basic information: None.
Significant transactions with investee companies in Mainland China directly or indirectly through businesses in a third region: None.

(IV) Information of major shareholders

Information on major shareholders: Please refer to Table 4 for details.

XIV. Information on operating segment

(I) General information

The Group divides operating units based on different products and services, and divides them into the following two reportable operating segment:

Sales segment: Responsible for the sales of wool-related products.

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Real estate segment: Responsible for real estate lease and sale business.
(II) Measurement of departmental information
Assets of reportable segments provided to major operational decision-makers are as follows:

are as follows:
			2023
	Construction	Product sales		Others
	projects sales
			Lease		Total
Net external income	$ 137,302	$ -	$ 61,559	$ 330	$ 199,191
Revenue of internal

departments	-	-	-	-	-

Departmental revenue	$ 137,302	$ -	$ 61,559	$ 330	$ 199,191
Departmental profit or loss	$ 16,613	($ 3,581)	$ 38,239	$ 148,026	$ 199,297
			2022
	Construction
	projects sales	Product sales		Others
			Lease		Total
Net external income	$ 502,330	$ 14,780	$ 52,778	$ 265	$ 570,153
Revenue of internal

departments	-	-	-	-	-

Departmental revenue	$ 502,330	$ 14,780	$ 52,778	$ 265	$ 570,153
Departmental profit or loss	$ 94,317	($ 3,350)	$ 29,402	$ 41,667	$ 162,036

Since the Group's assets and liabilities are not the indicators used by the operational decision-makers, the relevant amounts were not disclosed.

(III) Reconciliation information of departmental profit and loss

The external revenue and department profit and loss provided to the operational decision-maker are measured in the same way as the revenue and pre-tax profit or loss in the financial statements, so no adjustment is required.

(IV) Information by geographical location

Information of the Group by region in 2023 and 2022 is as follows:

	2023	2023	2022	2022
	Income	Non-current assets		Non-current
			Income	assets
Taiwan	$ 199,191	$ 2,306,001	$ 555,373	$ 2,080,897
Japan	-	-	14,780	-
Total	$ 199,191	$ 2,306,001	$ 570,153	$ 2,080,897

(V) Important Customer Information

Information of the Group's important customers in 2023 and 2022 is as follows:

	2023	2022
	Income	Income
Customer A from the trading department	$ -	$ 11,763
Customer B from the trading department	-	3,017
	$ -	$ 14,780

~66~

AI assistant

ASCENT — Annual Report 2023

51802_rns_2023-11-13_b00026f8-90b5-4834-9260-6cb32edd8719.pdf

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Financial Statements and Independent Auditors’ Report of 2023 and 2022

Table of Contents

Ascent Development Co., Ltd.

Declaration of Consolidated Financial Statements of Affiliates

Independent Auditors’ Report

Audit Opinions

Basis for Opinion

Key Audit Matters

Impairment Testing of Investment Using the Equity Method

Descriptions

Audit procedure

Appropriateness of the Vesting Period of Real Estate Sales Revenue

Descriptions

Audit procedure

Other Matters - Audits Conducted by Other Certified Public Accountants

Other Matters - Parent Company Only Financial Statements

Responsibilities of Management Level and Governance Units for the Consolidated Financial Statements

Responsibilities of Auditor to Audit Consolidated Financial Statements

protective measures).

PwC Taiwan

Chun-Yuan Hsiao

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Balance Sheet December 31, 2023 and 2022

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Balance Sheet

December 31, 2023 and 2022

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Statement of Comprehensive Income January 1 to December 31, 2023 and 2022

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Statement of Comprehensive Income January 1 to December 31, 2023 and 2022

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Statement of Changes in Equity January 1 to December 31, 2023 and 2022

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Statement of Cash Flows January 1 to December 31, 2023 and 2022

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES

(Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Consolidated Statement of Cash Flows January 1 to December 31, 2023 and 2022

ASCENT DEVELOPMENT CO., LTD. and SUBSIDIARIES (Previous name: CHUWA WOOL INDUSTRY CO., (TAIWAN) LTD.) Notes to Consolidated Financial Statements 2023 and 2022

I. History

II. Dates and procedures for approval of financial reports

III. Application of new and revised standards and interpretations

(II) The impact of the newly released and revised International Financial Reporting Standards that have not yet been adopted by the FSC

(III) Impacts of IFRSs issued by the IASB but not yet endorsed by the FSC

IV. Summary of Significant Accounting Policies

(I) Compliance statement

(II) Compilation basis

(III) Consolidation basis

Statement of Comprehensive Income

(IV) Foreign currency conversion

Foreign currency transactions and balances

(VI) Cash equivalents

(VII) Financial assets at FVTPL

(VIII) Financial assets at FVTOCI

(IX) Financial assets at amortized cost

(X) Accounts and Notes Receivable

(XI) Impairment of financial assets

(XII) Delisting of financial assets

' - (XIII) Lessor s lease transaction Business lease

(XIV) Inventory

- (XV) Investments using the equity method Affiliated enterprises

(XVI) Joint Agreements

(XIX) Investment property

- (XX) Impairment of non financial assets

(XXI) Borrowings

(XXII) Notes and Accounts Payable

(XXIII) Delisting of financial liabilities

(XXIV) Employee benefits

3. Severance benefits

4. Employees and directors remuneration

(XXV) Income Tax

(XXVI) Dividend distribution

(XXVII) Revenue recognition

1. Product sales

3. Lease revenue

(XXVIII) Organizational restructuring under joint control

(XXIX) Operating segment

V. Major sources of uncertainty in major accounting judgments, estimates and assumptions

(I) Important Judgments for Adoption of Accounting Policies

(II) Important Accounting Estimates and Assumptions

1. Impairment testing of investment using the equity method

2. Valuation of inventories

VI. Explanation of important accounting items

- (II) Financial assets at amortized cost Current

(III) Notes receivable and net accounts

ASCENT Annual Report 2023