ASROCK — Audit Report / Information 2021

Nov 8, 2021

3515

ASROCK INC. PARENT COMPANY ONLY FINANCIAL STATEMENTS

WITH INDEPENDENT AUDITORS’ REPORT FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020

Address: 2F., No. 37, Sec. 2, Jhongyang S. Rd., Beitou District, Taipei City 11270, Taiwan (R.O.C.)

Telephone: 886-2-2896-5588

The reader is advised that these parent company only financial statements have been prepared originally in Chinese. In the event of a conflict between these parent company only financial statements and the original Chinese version or difference in interpretation between the two versions, the Chinese language parent company only financial statements shall prevail.

1

Independent Auditors’ Report Translated from Chinese

To ASROCK INC.

Opinion

We have audited the accompanying balance sheets of ASROCK INC.(the “Company”) as of December 31, 2021 and 2020, and the related statements of comprehensive income, changes in equity and cash flows for the years ended December 31, 2021 and 2020, and notes to the parent company only financial statements, including the summary of significant accounting policies(collectively “the parent company only financial statements”).

In our opinion, based on our audits and the reports of other auditors (please refer to the Other Matter paragraph), the parent company only financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and its financial performance and cash flows for the years ended December 31, 2021 and 2020, in conformity with the requirements of the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

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

Key Audit Matters

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

2

- Investments accounted for using equity method Inventory of Subsidiary

The net carrying value of inventory as of December 31, 2021 for the Company’s investments accounted for using equity method - Inventory of Subsidiary was significant to the parent company only financial statements. ASROCK INC. and subsidiaries’ main business, the sale of motherboard products, are affected by market demand and changes. The management measured allowance for inventory obsolescence valuation losses based on market demands. The valuation involved management’s significant judgement, we have therefore determined valuation on inventory a key audit matter. The audit procedures we performed regarding inventories valuation included, but not limited to, understanding the program of estimating the allowance for inventory valuation, testing the effectiveness of relevant control. For the raw material and products, we selected samples and checked related certificates, to confirm the correctness of net realizable value that management used. In addition, we obtained and reviewed the full-year purchase and sales details of raw materials and products. For raw materials that are not frequently used and products with low sales volume, we referred to industry information and management to discuss the reasonableness of allowance for inventory valuation and obsolescence losses. We also considered the appropriateness of disclosure of inventories in Notes 5 and 6 of the Company’s consolidated financial statements.

Revenue recognition

The main source of revenue was from the sales of motherboard. Due to diversified pricing strategy, the orders and implied items in contracts usually included quantity discount and warranty, therefore the Company should determine the performance obligation and the timing of revenue recognition. Consequently, we considered that revenue recognition from contracts with customers is key audit matter. For revenue recognition, we have conducted audit procedures including but not limited to evaluating the design and operating effectiveness of internal controls with respect to the revenue cycle, selecting representative samples to conduct test of transactions by inspecting contracts approved by both parties, identifying the performance obligation, evaluating whether the transaction prices were appropriately allocated to all the performance obligations in the contract in proportion to the stand-alone selling prices of each performance obligation, and confirming the correctness of timing when a performance obligation is satisfied. We also considered the appropriation of operating revenue disclosure in Notes 4, 5 and 6 of the parent company only financial statements.

3

Other Matter - Making Reference to the Audits of Component Auditors

We did not audit the parent company only financial statements of certain investments accounted for using equity method whose statements are based solely on the reports of other auditors. These investments accounted for using equity method amounted to $829,353 thousand and $675,353 thousand, representing 7.81% and 6.81% of the parent company only total assets as of December 31, 2021 and 2020, respectively. The related share of profit or loss of subsidiaries, associates and joint ventures accounted for using equity method amounted to $175,248 thousand and $155,464 thousand, representing 6.12% and 9.98% of the profit before tax for the years ended December 31, 2021 and 2020.

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

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

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

Those charged with governance, including audit committee, are responsible for overseeing the financial reporting process of the Company.

Auditor’s Responsibilities for the Audit of the Parent Company Only Financial Statements

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

4

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

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

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

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

4. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability to continue as a going concern of the Company. 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 parent company only 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 Company to cease to continue as a going concern.

5. Evaluate the overall presentation, structure and content of the parent company only financial statements, including the accompanying notes, and whether the parent company only financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

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

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

5

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of 2021 parent company only financial statements 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.

Yang, Chih-Huei Yu, Chien-Ju

Ernst & Young, Taiwan February 23, 2022

Notice to Readers

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

Accordingly, the accompanying parent company only financial statements and report of independent accountants are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice. As the parent company only financial statements are the responsibility of the management, Ernst & Young cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

6

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese ASROCK INC.

PARENT COMPANY ONLY BALANCE SHEETS December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Current assets Cash and cash equivalents Financial assets measured at amortized cost - current Accounts receivable, net Accounts receivable - related parties, net Inventories, net Prepayments Other current assets Total current assets Non-current assets Investments accounted for using equity method Property, plant and equipment Right-of-use assets Intangible assets Deferred tax assets Guarantee deposits paid Other non-current assets Total non-current assets Assets	Notes 4,6(1) 4,6(2),6(12) 4,5,6(3),6(12) 4,5,6(3),6(12),7 4,5,6(4) 7 7 4,6(5) 4,6(6),7 4,6(13) 4,6(7) 4,5,6(17)		As	of
		December 31, 2021 $1,031,300 860,000 820,626 879,133 1,387,863 839,921 53,653 5,872,496 4,621,442 32,300 30,010 1,544 47,685 13,997 - 4,746,978	% 10 8 8 8 13 8 1 56 44 - - - - - - 44	December 31, 2020 $1,508,440 486,206 441,609 1,592,011 1,367,370 53,511 26,182 5,475,329 4,332,169 21,405 30,671 570 43,274 11,326 3,824 4,443,239	%
					15 5 4 16 14 1 -
					55
					44 - - - 1 - -
					45

Total assets

$10,619,474 100 $9,918,568 100

(Continued)

7

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese ASROCK INC.

PARENT COMPANY ONLY BALANCE SHEETS December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Current liabilities Accounts payable Accounts payable - related parties Other payables Current tax liabilities Lease liabilities - current Other current liabilities Total current liabilities Non-current liabilities Deferred tax liabilities Lease liabilities - non-current Net defined benefit liabiliies Total non-current liabilities Total liabilities Equity Capital Commom stock Capital surplus Retained earnings Legal reserve Special reserve Unappropriated retained earnings Total retained earnings Other components of equity Total equity Total liabilities and equity Liabilityand Equity	Notes 7 7 4,5,6(17) 4,6(13) 4,7 4,5,6(17) 4,6(13) 4,5,6(8) 6(9) 6(5),6(9),6(10) 6(9) 6(9) 6(5),6(9),6(10) 4,6(10)		As	of
		December 31, 2021 $72,387 527,970 691,173 453,144 15,322 531,487 2,291,483 - 14,823 42,028 56,851 2,348,334 1,229,254 3,332,351 1,345,085 472,656 2,628,386 4,446,127 (736,592) 8,271,140 $10,619,474	% 1 5 7 4 - 5 22 - - - - 22 12 31 13 4 25 42 (7) 78 100	December 31, 2020 $17,835 2,188,109 410,447 198,539 13,674 133,343 2,961,947 228 17,231 37,854 55,313 3,017,260 1,206,424 3,134,705 1,209,419 279,336 1,544,081 3,032,836 (472,657) 6,901,308 $9,918,568	%
					- 22 4 2 - 1
					29
					- - 1
					1
					30
					12
					32
					12 3 16
					31
					(5)
					70
					100

The accompanying notes are an integral part of the parent company only financial statements.

8

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese ASROCK INC.

PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars, Except for Earnings per Share)

AccountingItems	Notes	For theyears ended December 31,	For theyears ended December 31,	For theyears ended December 31,	For theyears ended December 31,
		2021	%	2020	%
Operating revenues Operating costs Gross profit Unrealized intercompany profit Realized intercompany profit Net gross profit Operating expenses Sales and marketing expenses General and administrative expenses Research and development expenses Expected credit losses Total operating expenses Net operating income Non-operating income and expenses Interest income Other income Other gains and losses Finance costs Share of profit or loss of subsidiaries, associates and joint ventures accounted for using equity method Total non-operating income and expenses Profit from continuting operations before tax Income tax expenses Profit from continuing operations Profit Other comprehensive income Items that will not be reclassified subsequently to profit or loss Losses on remeasurements of defined benefit plans Income tax related to items that will not be reclassified to profit or loss Items that may be reclassified subsequently to profit or loss Share of other comprehensive income of subsidiaries, associates and joint ventures accounted for using equity method, components of other comprehensive income that will not be reclassified to profit or loss Other comprehensive income, net of tax Total comprehensive income Earnings per share(NT$): Earnings per share - basic Profit from continuing operations Earnings per share - diluted Profit from continuing operations	4,5,6(11),7 6(4),6(14),7 4,6(7),6(8),6(10) 6(13),6(14),7 6(12) 6(15) 7 4,6(5) 4,5,6(17) 4,6(8),6(16) 6(18) 6(18)	$14,535,253 (10,820,676)	100 (74)	$12,577,723 (10,472,888)	100 (83)
		3,714,577	26	2,104,835	17
		(108,835) 133,313	(1) 1	(133,313) 81,456	(1) -
		3,739,055	26	2,052,978	16
		(370,005) (243,937) (663,826) (3,688)	(3) (2) (5) -	(293,649) (175,545) (484,401) (345)	(2) (1) (4) -
		(1,281,456)	(10)	(953,940)	(7)
		2,457,599	16	1,099,038	9
		8,503 111,510 (41,259) (235) 328,996	- 1 - - 2	12,009 84,963 (48,913) (312) 411,692	- 1 - - 3
		407,515	3	459,439	4
		2,865,114 (484,054)	19 (3)	1,558,477 (195,385)	13 (2)
		2,381,060	16	1,363,092	11
		2,381,060	16	1,363,092	11
		(3,287) 657 (109,101)	- - (1)	(7,364) 1,473 (193,321)	- - (2)
		(111,731)	(1)	(199,212)	(2)
		$2,269,329	15	$1,163,880	9
		$19.67		$11.30
		$19.53		$11.22

The accompanying notes are an integral part of the parent company only financial statements.

9

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese ASROCK INC.

PARENT COMPANY ONLY STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Appropriation and distribution of 2019 retained earnings Legal reserve appropriated Special reserve appropriated Cash dividends of ordinary share Profit in 2020 Other comprehensive income, net of tax in 2020 Treasury stock acquired Treasury stock cancelled Difference between consideration and carrying amount of subsidiaries acquired or disposed Changes in subsidiaries' ownership Share-based payment transaction Balance as of December 31, 2020 Appropriation and distribution of 2020 retained earnings Legal reserve appropriated Special reserve appropriated Cash dividends of ordinary share Profit in 2021 Other comprehensive income, net of tax in 2021 Changes in subsidiaries' ownership Share-based payment transaction Balance as of December 31, 2021 Balance as of January 1, 2021 Total comprehensive income Balance as of January 1, 2020 Total comprehensive income	Capital	Capital surplus		Retained earnings		Other components of equity	Other components of equity	Treasurystock	Total equity
			Legal reserve	Special reserve	Unappropriated retained earnings	Exchange differences on translation of foreign financial statements	Deferred compensation cost
	$1,206,472 - - - - -	$3,129,659 - - - - -	$1,149,884 59,535 - - - -	$186,407 - 92,929 - - -	$822,460 (59,535) (92,929) (482,570) 1,363,092 (5,891)	$(279,336) - - - - (193,321)	$(18,202) - - - - -	$- - - - - -	$6,197,344 - - (482,570) 1,363,092 (199,212)
	-	-	-	-	1,357,201	(193,321)	-	-	1,163,880
	- (48) - - -	- - 335 (261) 4,972	- - - - -	- - - - -	- - (27) - (519)	- - - - -	- - - - 18,202	(48) 48 - - -	(48) - 308 (261) 22,655
	$1,206,424	$3,134,705	$1,209,419	$279,336	$1,544,081	$(472,657)	$-	$-	$6,901,308
	$1,206,424 - - - - -	$3,134,705 - - - - -	$1,209,419 135,666 - - - -	$279,336 - 193,320 - - -	$1,544,081 (135,666) (193,320) (965,139) 2,381,060 (2,630)	$(472,657) - - - - (109,101)	$- - - - - -	$- - - - - -	$6,901,308 - - (965,139) 2,381,060 (111,731)
	-	-	-	-	2,378,430	(109,101)	-	-	2,269,329
	- 22,830	3,581 194,065	- -	- -	- -	- -	- (154,834)	- -	3,581 62,061
	$1,229,254	$3,332,351	$1,345,085	$472,656	$2,628,386	$(581,758)	$(154,834)	$-	$8,271,140

The accompanying notes are an integral part of the parent company only financial statements.

10

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from operating activities: Profit before tax Adjustments: Adjustments to reconcile (profit) loss: Depreciation expense Amortization expense Expected credit losses Interest expenses Interest income Compensation cost arising from employee stock options Share of profit of subsidiaries, associates and joint ventures accounted for using equity method Gain on disposal of property, plant and equipment Unrealized intercompany profit from sale Realized intercompany profit from sale Changes in operating assets and liabilities: (Increase) Decrease in accounts receivable, net Decrease (Increase) in account receivable-related parties Increase in inventories, net (Increase) Decrease in prepayments Increase in other current assets Increase in accounts payable (Decrease) Increase in accounts payables-related parties Increase in other payables Increase (Decrease) in other current liabilities Increase in net defined benefit liabilities Cash generated from operations Income taxes paid Net cash provided by operating activities Cash flows from investing activities: (Acquisition) Disposal of financial assets measured at amortized cost Acquisition of investments accounted for using equity method Acquisition of property, plant and equipment Proceed from disposal of property, plant and equipment Increase in guarantee deposits paid Acquisition of intangible assets Increase in other non-current assets Interest received Dividends received Net cash (used in) provided by investing activities Cash flows from financing activities: Cash payments for the principal portion of the lease liability Cash dividends paid Issuance of common stock for cash Treasury stock acquired Net cash used in financing activities Net (decrease) increase in cash and cash equivalents Cash and cash equivalents, beginning of the year Cash and cash equivalents, end of the year	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$2,865,114 24,325 2,461 3,688 235 (8,503) 39,231 (328,996) (20) 108,835 (133,313) (382,705) 712,878 (18,768) (786,410) (24,979) 54,552 (1,660,139) 280,726 398,144 887	$1,558,477 21,917 1,198 345 312 (12,009) 22,655 (411,692) - 133,313 (81,456) 86,723 (334,065) (611,562) 12,290 (2,835) 3,274 844,363 113,796 (12,944) 909
	1,147,243	1,333,009
	(233,431)	(129,720)
	913,812	1,203,289
	(373,794) (103,125) (17,727) 20 (2,671) (3,435) - 6,011 61,800	115,794 (4,073) (13,704) 11,196 (2,009) (1,122) (3,824) 12,601 -
	(432,921)	114,859
	(15,722) (965,139) 22,830 -	(14,379) (482,570) - (48)
	(958,031)	(496,997)
	(477,140) 1,508,440	821,151 687,289
	$1,031,300	$1,508,440

The accompanying notes are an integral part of the parent company only financial statements.

11

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese ASROCK INC.

NOTES TO PARENT COMPAMY ONLY FINANCIAL STATEMENTS

For the Years Ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

1. History and organization

ASROCK INC. (the Company) was approved to establish on May 10, 2002, and began its main business activities. The current main business is the sales of motherboards and related product development and design. The Company’s first public offering was approved by the Securities and Futures Bureau in May, 2006 and its common shares were publicly listed on the Taiwan Stock Exchange (TWSE) in November, 2007. The Company’s registered office and the main business location are at 2F., No. 37, Sec. 2, Jhongyang S. Rd., Beitou Dist., Taipei City 11270, Taiwan (R.O.C.). Pegatron Corporation is the ultimate controller of the Company to which the company belongs.

2. Date and procedures of authorization of financial statements for issue

The parent company only financial statements of the Company for the years ended December 31, 2021 and 2020 were authorized for issue by the Company’s board of directors on February 23, 2022.

3. Newly issued or revised standards and interpretations

• (1) Changes in accounting policies resulting from applying for the first time certain standards and amendments

The Company applied for the first time International Financial Reporting Standards, International Accounting Standards, and Interpretations issued, revised or amended which are recognized by Financial Supervisory Commission (“FSC”) and become effective for annual periods beginning on or after January 1, 2021. The adoption of these new standards and amendments had no material impact on the Company.

• (2) Standards or interpretations issued, revised or amended, by International Accounting Standards Board (“IASB”) which are endorsed by FSC, but not yet adopted by the Company as at the end of the reporting period are listed below.

Item	New,Revised or Amended Standards and Interpretations	Effective Date issued byIASB
a	Narrow-scope amendments of IFRS, including Amendments to IFRS 3, Amendments to IAS 16, Amendments to IAS 37 and the Annual Improvements	January 1, 2022

12

• (a) Narrow-scope amendments of IFRS, including Amendments to IFRS 3, Amendments to IAS 16, Amendments to IAS 37 and the Annual Improvements

• A. Updating a Reference to the Conceptual Framework (Amendments to IFRS 3)

The amendments updated IFRS 3 by replacing a reference to an old version of the Conceptual Framework for Financial Reporting with a reference to the latest version, which was issued in March 2018. The amendments also added an exception to the recognition principle of IFRS 3 to avoid the issue of potential “day 2” gains or losses arising for liabilities and contingent liabilities. Besides, the amendments clarify existing guidance in IFRS 3 for contingent assets that would not be affected by replacing the reference to the Conceptual Framework.

• B. Property, Plant and Equipment: Proceeds before Intended Use (Amendments to IAS 16)

The amendments prohibit a company from deducting from the cost of property, plant and equipment amounts received from selling items produced while the company is preparing the asset for its intended use. Instead, a company will recognize such sales proceeds and related cost in profit or loss.

• C. Onerous Contracts - Cost of Fulfilling a Contract (Amendments to IAS 37)

The amendments clarify what costs a company should include as the cost of fulfilling a contract when assessing whether a contract is onerous.

• D. Annual Improvements to IFRS Standards 2018 - 2020

Amendment to IFRS 1

The amendment simplifies the application of IFRS 1 by a subsidiary that becomes a first-time adopter after its parent in relation to the measurement of cumulative translation differences.

Amendment to IFRS 9 Financial Instruments

The amendment clarifies the fees a company includes when assessing whether the terms of a new or modified financial liability are substantially different from the terms of the original financial liability.

Amendment to Illustrative Examples Accompanying IFRS 16 Leases The amendment to Illustrative Example 13 accompanying IFRS 16 modifies the treatment of lease incentives relating to lessee’s leasehold improvements.

Amendment to IAS 41

The amendment removes a requirement to exclude cash flows from taxation when measuring fair value thereby aligning the fair value measurement requirements in IAS 41 with those in other IFRS Standards.

The abovementioned standards and interpretations were issued by IASB and endorsed by FSC so that they are applicable for annual periods beginning on or after January 1, 2022. The standards and interpretations have no material impact on the Group.

13

• (3) Standards or interpretations issued, revised or amended, by IASB which are not endorsed by FSC, and not yet adopted by the Group as at the end of the reporting period are listed below.

Items	New,Revised or Amended Standards and Interpretations	Effective Date issued byIASB
a	IFRS 10 “Consolidated Financial Statements” and IAS 28 “Investments in Associates and Joint Ventures” - Sale or Contribution of Assets between an Investor and its Associate or Joint Ventures	To be determined by IASB
b	IFRS 17 “Insurance Contracts”	January1,2023
c	Classification of Liabilities as Current or Non-current – Amendments to IAS 1	January 1, 2023
d	Disclosure Initiative - AccountingPolicies – Amendments to IAS 1	January1,2023
e	Definition of AccountingEstimates – Amendments to IAS 8	January1,2023
f	Deferred Tax related to Assets and Liabilities arising from a Single Transaction – Amendments to IAS 12	January 1, 2023

(a) IFRS 10“Consolidated Financial Statements” and IAS 28“Investments in Associates and Joint Ventures” — Sale or Contribution of Assets between an Investor and its Associate or Joint Ventures

The amendments address the inconsistency between the requirements in IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and Joint Ventures, in dealing with the loss of control of a subsidiary that is contributed to an associate or a joint venture. IAS 28 restricts gains and losses arising from contributions of non-monetary assets to an associate or a joint venture to the extent of the interest attributable to the other equity holders in the associate or joint ventures. IFRS 10 requires full profit or loss recognition on the loss of control of the subsidiary. IAS 28 was amended so that the gain or loss resulting from the sale or contribution of assets that constitute a business as defined in IFRS 3 between an investor and its associate or joint venture is recognized in full.

IFRS 10 was also amended so that the gains or loss resulting from the sale or contribution of a subsidiary that does not constitute a business as defined in IFRS 3 between an investor and its associate or joint venture is recognized only to the extent of the unrelated investors’ interests in the associate or joint venture.

• (b) IFRS 17 “Insurance Contracts”

IFRS 17 provides a comprehensive model for insurance contracts, covering all relevant accounting aspects (including recognition, measurement, presentation and disclosure requirements). The core of IFRS 17 is the General (building block) Model, under this model, on initial recognition, an entity shall measure a group of insurance contracts at the total of the fulfilment cash flows and the contractual service margin. The carrying amount of a group of insurance contracts at the end of each reporting period shall be the sum of the liability for remaining coverage and the liability for incurred claims.

14

Other than the General Model, the standard also provides a specific adaptation for contracts with direct participation features (the Variable Fee Approach) and a simplified approach (Premium Allocation Approach) mainly for short-duration contracts.

IFRS 17 was issued in May 2017 and it was amended in 2020 and 2021. The amendments include deferral of the date of initial application of IFRS 17 by two years to annual beginning on or after January 1, 2023 (from the original effective date of January 1, 2021); provide additional transition reliefs; simplify some requirements to reduce the costs of applying IFRS 17 and revise some requirements to make the results easier to explain. IFRS 17 replaces an interim Standard – IFRS 4 Insurance Contracts – from annual reporting periods beginning on or after January 1, 2023.

• (c) Classification of Liabilities as Current or Non-current – Amendments to IAS 1

These are the amendments to paragraphs 69-76 of IAS 1 Presentation of Financial statements and the amended paragraphs related to the classification of liabilities as current or non-current.

• (d) Disclosure Initiative - Accounting Policies – Amendments to IAS 1

The amendments improve accounting policy disclosures that to provide more useful information to investors and other primary users of the financial statements.

• (e) Definition of Accounting Estimates – Amendments to IAS 8

The amendments introduce the definition of accounting estimates and included other amendments to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors to help companies distinguish changes in accounting estimates from changes in accounting policies.

• (f) Deferred Tax related to Assets and Liabilities arising from a Single Transaction – Amendments to IAS 12

The amendments narrow the scope of the recognition exemption in paragraphs 15 and 24 of IAS 12 so that it no longer applies to transactions that, on initial recognition, give rise to equal taxable and deductible temporary differences.

15

The abovementioned standards and interpretations issued by IASB have not yet endorsed by FSC at the date when the Company’s financial statements were authorized for issue, the local effective dates are to be determined by FSC. As the Company is still currently determining the potential impact of the standards and interpretations listed under (a), it is not practicable to estimate their impact on the Company at this point in time. The remaining new or amended standards and interpretations have no material impact on the Company.

4. Summary of significant accounting policies

• (1) Statement of compliance

The parent company only financial statements of the Company for the years ended December 31, 2021 and 2020 have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers (“the Regulations”).

• (2) Basis of preparation

The Company prepared parent company only financial statements in accordance with Article 21 of the Regulations, which provided that the profit or loss and other comprehensive income for the period presented in the parent company only financial statements shall be the same as the profit or loss and other comprehensive income attributable to stockholders of the parent presented in the consolidated financial statements for the period, and the total equity presented in the parent company only financial statements shall be the same as the equity attributable to the parent company presented in the consolidated financial statements. Therefore, the Company accounted for its investments in subsidiaries using equity method and, accordingly, made necessary adjustments.

The parent company only financial statements have been prepared on a historical cost basis, except for financial instruments that have been measured at fair value. The parent company only financial statements are expressed in thousands of New Taiwan Dollars ("NT$") unless otherwise stated.

• (3) Foreign currency transactions

The Company's parent company only financial statements are presented in its functional currency, NT$. Items included in the parent company only financial statements are measured using that functional currency.

Transactions in foreign currencies are initially recorded by the Company at functional currency rates prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the functional currency closing rate of exchange ruling at the reporting date. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined. Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions.

16

All exchange differences arising on the settlement of monetary items or on translating monetary items are taken to profit or loss in the period in which they arise except for the following:

• (a) Exchange differences arising from foreign currency borrowings for an acquisition of a qualifying asset to the extent that they are regarded as an adjustment to interest costs are included in the borrowing costs that are eligible for capitalization.

• (b) Foreign currency items within the scope of IFRS 9 Financial Instruments are accounted for based on the accounting policy for financial instruments.

• (c) Exchange differences arising on a monetary item that forms part of a reporting entity’s net investment in a foreign operation is recognized initially in other comprehensive income and reclassified from equity to profit or loss on disposal of the net investment.

When a gain or loss on a non-monetary item is recognized in other comprehensive income, any exchange component of that gain or loss is recognized in other comprehensive income. When a gain or loss on a non-monetary item is recognized in profit or loss, any exchange component of that gain or loss is recognized in profit or loss.

• (4) Translation of financial statements in foreign currency

The assets and liabilities of foreign operations are translated into NT$ at the closing rate of exchange prevailing at the reporting date and their income and expenses are translated at an average rate for the period. The exchange differences arising on the translation are recognized in other comprehensive income. On the disposal of a foreign operation, the cumulative amount of the exchange differences relating to that foreign operation, recognized in other comprehensive income and accumulated in the separate component of equity, is reclassified from equity to profit or loss when the gain or loss on disposal is recognized. The following partial disposals are accounted for as disposals:

• (a) When the partial disposal involves the loss of control of a subsidiary that includes a foreign operation.

• (b) When the retained interest after the partial disposal of an interest in a joint arrangement or a partial disposal of an interest in an associate that includes a foreign operation is a financial asset that includes a foreign operation.

17

On the partial disposal of a subsidiary that includes a foreign operation that does not result in a loss of control, the proportionate share of the cumulative amount of the exchange differences recognized in other comprehensive income is re-attributed to the non-controlling interests in that foreign operation. In partial disposal of an associate or joint arrangement that includes a foreign operation that does not result in a loss of significant influence or joint arrangement control, only the proportionate share of the cumulative amount of the exchange differences recognized in other comprehensive income is reclassified to profit or loss.

Any goodwill and any fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and expressed in its functional currency.

• (5) Current and non-current distinction

An asset is classified as current when:

• (a) The Company expects to realize the asset, or intends to sell or consume it, in its normal operating cycle

• (b) The Company holds the asset primarily for the purpose of trading

• (c) The Company expects to realize the asset within twelve months after the reporting period

• (d) The asset is cash or cash equivalent unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets are classified as non-current.

A liability is classified as current when:

• (a) The Company expects to settle the liability in its normal operating cycle

• (b) The Company holds the liability primarily for the purpose of trading

• (c) The liability is due to be settled within twelve months after the reporting period

• (d) The Company does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

(6) Cash and cash equivalents

Cash and cash equivalents comprises cash on hand, demand deposits and short-term, highly liquid time deposits (including ones that have maturity within three months) or investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

18

(7) Financial instruments

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

Financial assets and financial liabilities within the scope of IFRS 9 Financial Instruments are recognized initially at fair value plus or minus, in the case of investments not at fair value through profit or loss, directly attributable transaction costs.

A. Financial instruments: Recognition and Measurement

The Company accounts for regular way purchase or sales of financial assets on the Accounts date.

The Company classified financial assets as subsequently measured at amortized cost, fair value through other comprehensive income or fair value through profit or loss considering both factors below:

• (a) the Company’s business model for managing the financial assets and

• (b) the contractual cash flow characteristics of the financial asset.

Financial assets measured at amortized cost

A financial asset is measured at amortized cost if both of the following conditions are met and presented as note receivables, account receivables financial assets measured at amortized cost and other receivables etc., on balance sheet as at the reporting date:

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

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

Such financial assets are subsequently measured at amortized cost (the amount at which the financial asset is measured at initial recognition minus the principal repayments, plus or minus the cumulative amortization using the effective interest method of any difference between the initial amount and the maturity amount and adjusted for any loss allowance) and is not part of a hedging relationship. A gain or loss is recognized in profit or loss when the financial asset is derecognized, through the amortization process or in order to recognize the impairment gains or losses.

19

Interest revenue is calculated by using the effective interest method. This is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except for:

• (a) purchased or originated credit-impaired financial assets. For those financial assets, the Company applies the credit-adjusted effective interest rate to the amortized cost of the financial asset from initial recognition.

• (b) financial assets that are not purchased or originated credit-impaired financial assets but subsequently have become credit-impaired financial assets. For those financial assets, the Company applies the effective interest rate to the amortized cost of the financial asset in subsequent reporting periods.

Financial asset measured at fair value through other comprehensive income

A financial asset is measured at fair value through other comprehensive income if both of the following conditions are met:

• (a) the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and

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

Recognition of gain or loss on a financial asset measured at fair value through other comprehensive income are described as below:

• (a) A gain or loss on a financial asset measured at fair value through other comprehensive income recognized in other comprehensive income, except for impairment gains or losses and foreign exchange gains and losses, until the financial asset is derecognized or reclassified.

• (b) When the financial asset is derecognized the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss as a reclassification adjustment.

• (c) Interest revenue is calculated by using the effective interest method. This is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except for:

• i. Purchased or originated credit-impaired financial assets. For those financial assets, the Company applies the credit-adjusted effective interest rate to the amortized cost of the financial asset from initial recognition.

20

• ii. Financial assets that are not purchased or originated credit-impaired financial assets but subsequently have become credit-impaired financial assets. For those financial assets, the Company applies the effective interest rate to the amortized cost of the financial asset in subsequent reporting periods.

Besides, for certain equity investments within the scope of IFRS 9 that is neither held for trading nor contingent consideration recognized by an acquirer in a business combination to which IFRS 3 applies, the Company made an irrevocable election to present the changes of the fair value in other comprehensive income at initial recognition. Amounts presented in other comprehensive income shall not be subsequently transferred to profit or loss (when disposal of such equity instrument, its cumulated amount included in other components of equity is transferred directly to the retained earnings) and these investments should be presented as financial assets measured at fair value through other comprehensive income on the balance sheet. Dividends on such investment are recognized in profit or loss unless the dividends clearly represent a recovery of part of the cost of investment.

Financial asset measured at fair value through profit or loss

Financial assets were classified as measured at amortized cost or measured at fair value through other comprehensive income based on aforementioned criteria. All other financial assets were measured at fair value through profit or loss and presented on the balance sheet as financial assets measured at fair value through profit or loss.

Such financial assets are measured at fair value, the gains or losses resulting from remeasurement is recognized in profit or loss which includes any dividend or interest received on such financial assets.

• B. Impairment of financial assets

The Company recognizes a loss allowance for expected credit losses on debt instrument investments measured at fair value through other comprehensive income and financial asset measured at amortized cost. The loss allowance on debt instrument investments measured at fair value through other comprehensive income is recognized in other comprehensive income and not reduce the carrying amount in the balance sheet.

The Company measures expected credit losses of a financial instrument in a way that reflects:

• (a) an unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes;

• (b) the time value of money; and

• (c) reasonable and supportable information that is available without undue cost or effort at the reporting date about past events, current conditions and forecasts of future economic conditions.

21

The loss allowance is measures as follows:

• (a) At an amount equal to 12-month expected credit losses: the credit risk on a financial asset has not increased significantly since initial recognition or the financial asset is determined to have low credit risk at the reporting date. In addition, the Company measures the loss allowance at an amount equal to lifetime expected credit losses in the previous reporting period, but determines at the current reporting date that the credit risk on a financial asset has increased significantly since initial recognition is no longer met.

• (b) At an amount equal to the lifetime expected credit losses: the credit risk on a financial asset has increased significantly since initial recognition or financial asset that is purchased or originated credit-impaired financial asset.

• (c) For Accounts receivables or contract assets arising from transactions within the scope of IFRS 15, the Company measures the loss allowance at an amount equal to lifetime expected credit losses.

• (d) For lease receivables arising from transactions within the scope of IFRS 16, the Company measures the loss allowance at an amount equal to lifetime expected credit losses.

At each reporting date, the Company needs to assess whether the credit risk on a financial asset has increased significantly since initial recognition by comparing the risk of a default occurring at the reporting date and the risk of default occurring at initial recognition. Please refer to Note 12 for further details on credit risk.

• C. Derecognition of financial assets

A financial asset is derecognized when:

• (a) The rights to receive cash flows from the asset have expired

• (b) The Company has transferred the asset and substantially all the risks and rewards of the asset have been transferred

• (c) The Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

On derecognition of a financial asset in its entirety, the difference between the carrying amount and the consideration received or receivable including any cumulative gain or loss that had been recognized in other comprehensive income is recognized in profit or loss.

22

D. Financial liabilities and equity

Classification between liabilities or equity

The Company classifies the instrument issued as a financial liability or an equity instrument in accordance with the substance of the contractual arrangement and the definitions of a financial liability, and an equity instrument.

Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. The transaction costs of an equity transaction are accounted for as a deduction from equity (net of any related income tax benefit) to the extent they are incremental costs directly attributable to the equity transaction that otherwise would have been avoided.

Financial liabilities

Financial liabilities within the scope of IFRS 9 Financial Instruments are classified as financial liabilities at fair value through profit or loss or financial liabilities measured at amortized cost upon initial recognition.

Financial liabilities at amortized cost

Financial liabilities measured at amortized cost include interest bearing loans and borrowings that are subsequently measured using the effective interest rate method after initial recognition. Gains and losses are recognized in profit or loss when the liabilities are derecognized as well as through the effective interest rate method amortization process.

Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or transaction costs.

Derecognition of financial liabilities

A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires.

When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified (whether or not attributable to the financial difficulty of the debtor), such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognized in profit or loss.

23

E. Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount reported in the balance sheet if, and only if, there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, or to realize the assets and settle the liabilities simultaneously.

• (8) Fair value measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

• A. In the principal market for the asset or liability, or

• B. In the absence of a principal market, in the most advantageous market for the asset or liability

The principal or the most advantageous market must be accessible to by the Company.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

(9) Inventories

Inventories are valued at lower of cost and net realizable value item by item.

Costs incurred in bringing each inventory to its present location and condition are accounted for as follows:

Raw materials - Purchase cost on a weighted average cost basis.

Finished goods and work in progress - Cost of direct materials and labor and a proportion of manufacturing overheads based on normal operating capacity but excluding borrowing costs.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.

Rendering of services is accounted in accordance with IFRS 15 and not within the scope of inventories.

24

(10) Investments accounted for using the equity method

The Company accounted for its investments in subsidiaries using equity method and made necessary adjustments in accordance with Article 21 of the Regulations. Such adjustments were made after the Company considered the different accounting treatments to account for its investments in subsidiaries in the consolidated financial statements under IFRS 10 "Consolidated Financial Statements" and the different IFRSs adopted from different reporting entity's perspectives, and the Company recorded such adjustments by crediting or debiting to investments accounted for under the equity method, share of profit or loss of subsidiaries, associates and joint ventures and share of other comprehensive income of subsidiaries, associates and joint ventures.

The Company's investment in its associate is accounted for using the equity method other than those that meet the criteria to be classified as held for sale. An associate is an entity over which the Company has significant influence.

Under the equity method, the investment in the associate or investment in a joint venture is carried in the balance sheet at cost and adjusted thereafter for the post-acquisition change in the Company's share of net assets of the associate or joint venture. After the interest in the associate or joint venture is reduced to zero, additional losses are provided for, and a liability is recognized, only to the extent that the Company has incurred legal or constructive obligations or made payments on behalf of the associate or joint venture. Unrealized gains and losses resulting from transactions between the Company and the associate or joint venture are eliminated to the extent of the Company's related interest in the associate or joint venture.

When changes in the net assets of an associate or a joint venture occur and not those that are recognized in profit or loss or other comprehensive income and do not affects the Company’s percentage of ownership interests in the associate or joint venture, the Company recognizes such changes in equity based on its percentage of ownership interests. The resulting capital surplus recognized will be reclassified to profit or loss at the time of disposing the associate or joint venture on a prorata basis.

When the associate or joint venture issues new stock, and the Company’s interest in an associate or a joint venture is reduced or increased as the Company fails to acquire shares newly issued in the associate or joint venture proportionately to its original ownership interest, the increase or decrease in the interest in the associate or joint venture is recognized in Additional Paid in Capital and Investment accounted for using the equity method. When the interest in the associate or joint venture is reduced, the cumulative amounts previously recognized in other comprehensive income are reclassified to profit or loss or other appropriate items. The aforementioned capital surplus recognized is reclassified to profit or loss on a pro rata basis when the Company disposes the associate or joint venture.

The financial statements of the associate or joint venture are prepared for the same reporting period as the Company. Where necessary, adjustments are made to bring the accounting policies in line with those of the Company.

25

The Company determines at each reporting date whether there is any objective evidence that the investment in the associate or an investment in a joint venture is impaired in accordance with IAS 28 Investments in Associates and Joint Ventures. If this is the case the Company calculates the amount of impairment as the difference between the recoverable amount of the associate or joint venture and its carrying value and recognizes the amount in the ‘share of profit or loss of an associate’ in the statement of comprehensive income in accordance with IAS 36 Impairment of Assets . In determining the value in use of the investment, the Company estimates:

• (a) Its share of the present value of the estimated future cash flows expected to be generated by the associate or joint venture, including the cash flows from the operations of the associate and the proceeds on the ultimate disposal of the investment; or

• (b) The present value of the estimated future cash flows expected to arise from dividends to be received from the investment and from its ultimate disposal.

Because goodwill that forms part of the carrying amount of an investment in an associate or an investment in a joint venture is not separately recognized, it is not tested for impairment separately by applying the requirements for impairment testing goodwill in IAS 36 Impairment of Assets.

Upon loss of significant influence over the associate or joint venture, the Company measures and recognizes any retaining investment at its fair value. Any difference between the carrying amount of the associate or joint venture upon loss of significant influence and the fair value of the retaining investment and proceeds from disposal is recognized in profit or loss.

(11) Property, plant and equipment

Property, plant and equipment is stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. Such cost includes the cost of dismantling and removing the item and restoring the site on which it is located and borrowing costs for construction in progress if the recognition criteria are met. Each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the item is depreciated separately. When significant parts of property, plant and equipment are required to be replaced in intervals, the Company recognized such parts as individual assets with specific useful lives and depreciation, respectively. The carrying amount of those parts that are replaced is derecognized in accordance with the derecognition provisions of IAS 16 Property, plant and equipment. When a major inspection is performed, its cost is recognized in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognized in profit or loss as incurred.

26

Depreciation is calculated on a straight-line basis over the estimated economic lives of the following assets:

Machinery and equipment	5 years
Office equipment	3 years
Lease improvement	Shorter of the lease period or the useful life
Other equipment	2~5 years

An item of property, plant and equipment and any significant part initially recognized is derecognized upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset is recognized in profit or loss.

The assets’ residual values, useful lives and methods of depreciation are reviewed at each financial year end and adjusted prospectively, if appropriate.

(12) Leases

The Company assesses whether the contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset for a period of time, the Company assesses whether, throughout the period of use, has both of the following:

• (a) the right to obtain substantially all of the economic benefits from use of the identified asset; and

• (b) the right to direct the use of the identified asset.

For a contract that is, or contains, a lease, the Company accounts for each lease component within the contract as a lease separately from non-lease components of the contract. For a contract that contains a lease component and one or more additional lease or non-lease components, the Company allocates the consideration in the contract to each lease component on the basis of the relative stand-alone price of the lease component and the aggregate standalone price of the non-lease components. The relative stand-alone price of lease and non-lease components shall be determined on the basis of the price the lessor, or a similar supplier, would charge the Company for that component, or a similar component, separately. If an observable stand-alone price is not readily available, the Company estimates the stand-alone price, maximizing the use of observable information.

Company as a lessee

Except for leases that meet and elect short-term leases or leases of low-value assets, the Company recognizes right-of-use asset and lease liability for all leases which the Company is the lessee of those lease contracts.

27

At the commencement date, the Company measures the lease liability at the present value of the lease payments that are not paid at that date. The lease payments are discounted using the interest rate implicit in the lease, if that rate can be readily determined. If that rate cannot be readily determined, the Company uses its incremental borrowing rate. At the commencement date, the lease payments included in the measurement of the lease liability comprise the following payments for the right to use the underlying asset during the lease term that are not paid at the commencement date:

• (a) fixed payments (including in-substance fixed payments), less any lease incentives receivable;

• (b) variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;

• (c) amounts expected to be payable by the lessee under residual value guarantees;

• (d) the exercise price of a purchase option if the Company is reasonably certain to exercise that option; and

• (e) payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to terminate the lease.

After the commencement date, the Company measures the lease liability on an amortised cost basis, which increases the carrying amount to reflect interest on the lease liability by using an effective interest method; and reduces the carrying amount to reflect the lease payments made.

At the commencement date, the Company measures the right-of-use asset at cost. The cost of the right-of-use asset comprises:

• (a) the amount of the initial measurement of the lease liability;

• (b) any lease payments made at or before the commencement date, less any lease incentives received;

• (c) any initial direct costs incurred by the lessee; and

• (d) an estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset, restoring the site on which it is located or restoring the underlying asset to the condition required by the terms and conditions of the lease.

For subsequent measurement of the right-of-use asset, the Company measures the right-ofuse asset at cost less any accumulated depreciation and any accumulated impairment losses. That is, the Company measures the right-of-use applying a cost model.

If the lease transfers ownership of the underlying asset to the Company by the end of the lease term or if the cost of the right-of-use asset reflects that the Company will exercise a purchase option, the Company depreciates the right-of-use asset from the commencement date to the end of the useful life of the underlying asset. Otherwise, the Company depreciates the rightof-use asset from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term.

28

The Company applies IAS 36 “Impairment of Assets” to determine whether the right-of-use asset is impaired and to account for any impairment loss identified.

Except for those leases that the Company accounted for as short-term leases or leases of lowvalue assets, the Company presents right-of-use assets and lease liabilities in the balance sheet and separately presents lease-related interest expense and depreciation charge in the statements comprehensive income.

For short-term leases or leases of low-value assets, the Company elects to recognize the lease payments associated with those leases as an expense on either a straight-line basis over the lease term or another systematic basis.

(13) Intangible assets

Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a business combination is its fair value as of the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses, if any. Internally generated intangible assets, excluding capitalized development costs, are not capitalized and expenditure is reflected in profit or loss for the year in which the expenditure is incurred.

The useful lives of intangible assets are assessed as either finite or indefinite.

Intangible assets with finite lives are amortized over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortization period and the amortization method for an intangible asset with a finite useful life are reviewed at least at the end of each financial year. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset is accounted for by changing the amortization period or method, as appropriate, and are treated as changes in accounting estimates.

Intangible assets with indefinite useful lives are not amortized, but are tested for impairment annually, either individually or at the cash-generating unit level. The assessment of indefinite life is reviewed annually to determine whether the indefinite life continues to be supportable. If not, the change in useful life from indefinite to finite is made on a prospective basis.

Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in profit or loss when the asset is derecognized.

29

Research and development costs

Research costs are expensed as incurred. Development expenditures, on an individual project, are recognized as an intangible asset when the Company can demonstrate:

• i) The technical feasibility of completing the intangible asset so that it will be available for use or sale

• ii) Its intention to complete and its ability to use or sell the asset

• iii) How the asset will generate future economic benefits

• iv) The availability of resources to complete the asset

• v) The ability to measure reliably the expenditure during development

Following initial recognition of the development expenditure as an asset, the cost model is applied requiring the asset to be carried at cost less any accumulated amortization and accumulated impairment losses. During the period of development, the asset is tested for impairment annually. Amortization of the asset begins when development is complete and the asset is available for use. It is amortized over the period of expected future benefit.

Computer software

The cost of computer software is amortized on a straight-line basis over the estimated useful life (1 to 2 years).

(14) Impairment of non-financial assets

The Company assesses at the end of each reporting period whether there is any indication that an asset in the scope of IAS 36 Impairment of Assets may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cashgenerating unit’s (“CGU”) fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or companies of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

For assets excluding goodwill, an assessment is made at each reporting date as to whether there is any indication that previously recognized impairment losses may no longer exist or may have decreased. If such indication exists, the Company estimates the asset’s or cashgenerating unit’s recoverable amount. A previously recognized impairment loss is reversed only if there has been an increase in the estimated service potential of an asset which in turn increases the recoverable amount. However, the reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognized for the asset in prior years.

30

A cash generating unit, or companies of cash-generating units, to which goodwill has been allocated is tested for impairment annually at the same time, irrespective of whether there is any indication of impairment. If an impairment loss is to be recognized, it is first allocated to reduce the carrying amount of any goodwill allocated to the cash generating unit (company of units), then to the other assets of the unit (company of units) pro rata on the basis of the carrying amount of each asset in the unit (company of units). Impairment losses relating to goodwill cannot be reversed in future periods for any reason.

An impairment loss of continuing operations or a reversal of such impairment loss is recognized in profit or loss.

(15) Provisions

Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probably that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Where the Company expects some or all of a provision to be reimbursed, the reimbursement is recognized as a separate asset but only when the reimbursement is virtually certain. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.

Provision for warranties

A provision is recognized for expected warranty claims on products sold, based on past experience, management’s judgement and other known factors.

(16) Revenue recognition

The Company’s revenue arising from contracts with customers are primarily related to sale of goods and rendering of services. The accounting policies are explained as follows:

Sale of goods

The Company manufactures and sells machinery. Sales are recognized when control of the goods is transferred to the customer and the goods are delivered to the customers. The main product of the Company is high-end machinery and revenue is recognized based on the consideration stated in the contract. For certain sales of goods transactions, they are usually accompanied by volume discounts (based on the accumulated total sales amount for a specified period). Therefore, revenue from these sales is recognized based on the price specified in the contract, net of the estimated volume discounts to the Company estimates the discounts using the expected value method based on historical experiences. Revenue is only recognized to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur and when the uncertainty associated with the variable consideration is subsequently resolved. During the period specified in the contract, refund liability is recognized for the expected volume discounts.

31

The Company provides its customer with a warranty with the purchase of the products. The warranty provides assurance that the product will operate as expected by the customers. And the warranty is accounted in accordance with IAS 37.

The credit period of the Company’s sale of goods is from 30 to 90 days. For most of the contracts, when the Company transfers the goods to customers and has a right to an amount of consideration that is unconditional, these contracts are recognized as Accounts receivables. These accounts receivable usually have a short period and do not have a significant financial component.

Rendering of services

The Company provides services of product development. These services are separately priced or negotiated, and are recognized as revenue when the performance obligations are met.

(17)Post-employment benefits

All regular employees of the Company are entitled to a pension plan that is managed by an independently administered pension fund committee. Fund assets are deposited under the committee’s name in the specific bank account and hence, not associated with the Company. Therefore, fund assets are not included in the Company’s parent company only financial statements. Pension benefits for employees of the overseas subsidiaries and the branches are provided in accordance with the respective local regulations.

For the defined contribution plan, the Company will make a monthly contribution of no less than 6% of the monthly wages of the employees subject to the plan. The Company recognizes expenses for the defined contribution plan in the period in which the contribution becomes due. Overseas subsidiaries and branches make contribution to the plan based on the requirements of local regulations.

Post-employment benefit plan that is classified as a defined benefit plan uses the Projected Unit Credit Method to measure its obligations and costs based on actuarial assumptions. Remeasurements, comprising of the effect of the actuarial gains and losses, the effect of the asset ceiling (excluding net interest) and the return on plan assets, excluding net interest, are recognized as other comprehensive income with a corresponding debit or credit to retained earnings in the period in which they occur. Past service costs are recognized in profit or loss on the earlier of:

(a) the date of the plan amendment or curtailment, and

(b) the date that the Company recognizes restructuring-related costs

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset, both as determined at the start of the annual reporting period, taking account of any changes in the net defined benefit liability (asset) during the period as a result of contribution and benefit payment.

32

(18)Share-based payment transactions

The cost of equity-settled transactions between the Company and its employees is recognized based on the fair value of the equity instruments granted. The fair value of the equity instruments is determined by using an appropriate pricing model.

The cost of equity-settled transactions is recognized, together with a corresponding increase in other capital reserves in equity, over the period in which the performance and/or service conditions are fulfilled. The cumulative expense recognized for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Company’s best estimate of the number of equity instruments that will ultimately vest. The income statement expense or credit for a period represents the movement in cumulative expense recognized as at the beginning and end of that period.

No expense is recognized for awards that do not ultimately vest, except for equity-settled transactions where vesting is conditional upon a market or non-vesting condition, which are treated as vesting irrespective of whether or not the market or non-vesting condition is satisfied, provided that all other performance and/or service conditions are satisfied.

Where the terms of an equity-settled transaction award are modified, the minimum expense recognized is the expense as if the terms had not been modified, if the original terms of the award are met. An additional expense is recognized for any modification that increases the total fair value of the share-based payment transaction, or is otherwise beneficial to the employee as measured at the date of modification.

Where an equity-settled award is cancelled, it is treated as if it vested on the date of cancellation, and any expense not yet recognized for the award is recognized immediately. This includes any award where non-vesting conditions within the control of either the entity or the employee are not met. However, if a new award is substituted for the cancelled award, and designated as a replacement award on the date that it is granted, the cancelled and new awards are treated as if they were a modification of the original award, as described in the previous paragraph.

The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

The cost of restricted stocks issued is recognized as salary expense based on the fair value of the equity instruments on the grant date, together with a corresponding increase in other capital reserves in equity, over the vesting period. The Company recognized unearned employee salary which is a transitional contra equity account; the balance in the account will be recognized as salary expense over the passage of vesting period.

33

(19) Income taxes

Income tax expense (income) is the aggregate amount included in the determination of profit or loss for the period in respect of current tax and deferred tax.

Current income tax

Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the end of the reporting period. Current income tax relating to items recognized in other comprehensive income or directly in equity is recognized in other comprehensive income or equity and not in profit or loss.

The income tax for undistributed earnings is recognized as income tax expense in the subsequent year when the distribution proposal is approved by the Shareholders’ meeting.

Deferred tax

Deferred tax is provided on temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.

Deferred tax liabilities are recognized for all taxable temporary differences, except:

• A. Where the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss.

• B. In respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred tax assets are recognized for all deductible temporary differences, carry forward of unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilized, except:

• A. Where the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss.

34

• B. In respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, deferred tax assets are recognized only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilized.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the reporting date. The measurement of deferred tax assets and deferred tax liabilities reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. Deferred tax relating to items recognized outside profit or loss is recognized outside profit or loss. Deferred tax items are recognized in correlation to the underlying transaction either in other comprehensive income or directly in equity. Deferred tax assets are reassessed at each reporting date and are recognized accordingly.

Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current income tax assets against current income tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.

5. Significant accounting judgements, estimates and assumptions

The preparation of the parent company only financial statements require management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities, at the end of the reporting period. However, uncertainty about these assumption and estimate could result in outcomes that require a material adjustment to the carrying amount of the asset or liability affected in future periods.

(1) Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

(a) Fair value of financial instruments

Where the fair value of financial assets and financial liabilities recorded in the balance sheet cannot be derived from active markets, they are determined using valuation techniques including the income approach (for example the discounted cash flows model) or market approach. Changes in assumptions about these factors could affect the reported fair value of the financial instruments. Please refer to Note 12 for more details.

35

• (b) Pension benefits

The cost of post-employment benefit and the present value of the pension obligation under defined benefit pension plans are determined using actuarial valuations. An actuarial valuation involves making various assumptions. These include the determination of the discount rate and changes of the future salary etc. Please refer to Note 6 for more details.

• (c) Revenue recognition – sales returns and allowance

The Company estimates sales returns and allowance based on historical experience and other known factors at the time of sale, which reduces the operating revenue. In assessing the aforementioned sales returns and allowance, revenue is recognized to the extent it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur. Please refer to Note 6 for more details.

• (d) Income tax

Uncertainties exist with respect to the interpretation of complex tax regulations and the amount and timing of future taxable income. Given the wide range of international business relationships and the long-term nature and complexity of existing contractual agreements, differences arising between the actual results and the assumptions made, or future changes to such assumptions, could necessitate future adjustments to tax income and expense already recorded. The Company establishes provisions, based on reasonable estimates, for possible consequences of audits by the tax authorities of the respective counties in which it operates. The amount of such provisions is based on various factors, such as experience of previous tax audits and differing interpretations of tax regulations by the taxable entity and the responsible tax authority. Such differences of interpretation may arise on a wide variety of issues depending on the conditions prevailing in the respective Company company's domicile.

Deferred tax assets are recognized for all carry forward of unused tax losses and unused tax credits and deductible temporary differences to the extent that it is probable that taxable profit will be available or there are sufficient taxable temporary differences against which the unused tax losses, unused tax credits or deductible temporary differences can be utilized. The amount of deferred tax assets determined to be recognized is based upon the likely timing and the level of future taxable profits and taxable temporary differences together with future tax planning strategies. As of December 31, 2021, please refer to Note 6 for the explanation of the Company's unrecognized deferred income tax assets.

36

(e) Accounts receivables–estimation of impairment loss

The Company estimates the impairment loss of Accounts receivables at an amount equal to lifetime expected credit losses. The credit loss is the present value of the difference between the contractual cash flows that are due under the contract (carrying amount) and the cash flows that expects to receive (evaluate forward looking information). However, as the impact from the discounting of short-term receivables is not material, the credit loss is measured by the undiscounted cash flows. Where the actual future cash flows are lower than expected, a material impairment loss may arise. Please refer to Note 6 for more details.

(f) Inventories

Due to the rapid changes in technology and product demand, the Company assessed the inventory at the end of the reporting period due to normal wear and tear, obsolescence, or changes in market sales prices, and reduced inventory costs to net realizable value. The Company estimates the loss of obsolete inventories based on the product life cycle, historical experience, and subsequent inventory removal. Please refer to Note 6 for more details.

6. Contents of significant accounts

• (1) Cash and cash equivalents

Cash on hand Cash in banks Time deposits Cash equivalents–Bonds with repurchase agreements Total	As of December 31,	As of December 31,
	2021	2020
	$480 920,088 110,732 -	$513 549,514 815,930 142,483
	$1,031,300	$1,508,440

Cash and cash equivalents were not pledged.

(2) Financial assets measured at amortized cost

Time deposit–Current	As of December 31,	As of December 31,
	2021	2020
	$860,000	$486,206

The Company classified certain financial assets as financial assets measured at amortized cost. Please refer to Note 6(12) for more details on loss allowance and Note 12 for more details on credit risk.

37

(3) Accounts receivable and Accounts receivable - related parties

Accounts receivable (total carrying amount) Less: loss allowance Subtotal Accounts receivable-related parties (total carrying amount) Less: loss allowance Subtotal Total	As of December 31,	As of December 31,
	2021	2020
	$829,315 (8,689)	$446,610 (5,001)
	820,626	441,609
	879,133 -	1,592,011 -
	879,133	1,592,011
	$1,699,759	$2,033,620

Accounts receivables were not pledged.

Accounts receivables are generally on 30-90 day terms. The total carrying amount as of December 31, 2021 and 2020 were $1,708,448 thousand and $2,038,621 thousand, respectively. Please refer to Note 6(12) for more details on loss allowance of accounts receivable for the years ended December 31, 2021 and 2020. Please refer to Note 12 for more details on credit risk management.

(4) Inventories

Raw materials Work in progress Finished goods Merchandise Total	As of December 31,	As of December 31,
	2021	2020
	$153,524 406,048 5,501 822,790	$13,043 23,882 4,175 1,326,270
	$1,387,863	$1,367,370

For the years ended December 31, 2021 and 2020, the Company recognized $10,820,676 thousand and $10,472,888 thousand, respectively, in operating cost, including the write-down of inventories of $34,173 thousand and $5,134 thousand, respectively.

No inventories were pledged.

38

(5) Investments accounted for using equity method

Investees	As of December 31,	As of December 31,	As of December 31,	As of December 31,
	2021		2020
	Amount	Percentage of ownership (%)	Amount	Percentage of ownership (%)
Investments in subsidiaries: ASIAROCK TECHNOLOGY LIMITED LEADER INSIGHT HOLDINGS LTD. ASROCK RACK INCORPORATION ASRock Industrial Computer Corporation SOARING ASIA LIMITED ASJade Technology Inc. Total	$3,599,438 102,306 418,174 399,697 533 101,294	100.00% 100.00% 59.67% 65.83% 100.00% 78.57%	$3,563,486 35,743 387,739 344,649 552 -	100.00% 100.00% 62.05% 66.96% 100.00% -
	$4,621,442		$4,332,169

The share of profit or loss of subsidiaries, associates and joint ventures accounted for using equity method as of December 31, 2021 and 2020 were $328,996 thousand and $411,692 thousand, respectively, based on the financial statements of the investee company audited by accountants during the same period.

Investments in subsidiaries

Investments in subsidiaries are expressed in parent company only financial statements as "Investments accounted for using equity method", and necessary evaluation adjustments are made.

The Company paid $300 thousand, $246 thousand and $266 thousand, respectively on January 13, March 23, and May 7, 2020. The purchase of 30 thousand shares, 20 thousand shares and 21 thousand shares of ASRock Industrial Computer Corporation from non-related parties increased the Company’s original shareholding ratio from 67.38% to 67.46%, and then to 67.52% and 67.58%, respectively, and increased capital shares, which then increased capital surplus in the amount of $69 thousand, $5 thousand and $3 thousand, respectively. Later, the employee stock option was processed on July 31, 2020, and the board of directors resolved to issue new shares, increasing the capital by $6,848 thousand. Because the company did not subscribe according to the shareholding ratio, the original shareholding ratio of the Company after the capital increase was 67.58% reduced to 66.28%, and recognized capital reserve decreased by $1,384 thousand. In addition, the Company paid $1,295 thousand, $1,302 thousand and $452 thousand, respectively on September 30, December 7, and December 21, 2020. The purchase of 105 thousand shares, 103 thousand shares and 36 thousand shares of ASRock Industrial Computer Corporation from non-related parties increased the Company’s original shareholding ratio from 66.28% to 66.58%, and then to 66.86% and 66.96%, respectively, and increased capital shares, which then increased capital surplus in the amount of $124 thousand, $155 thousand and $53 thousand, respectively. Furthermore, the employee stock option plan was adopted on June 11, 2021, and the board of directors resolved to issue new shares, increasing the capital by $6,132 thousand. Because the Company did not subscribe the shares according to the shareholding ratio, the shareholding ratio of the Company was reduced from 66.96% to 65.83% after the capital increase and the capital reserve decreased in the amount of $6,644 thousand.

39

The Company purchased 2 thousand shares and 9 thousand shares of ASROCK RACK INCORPORATION from non-related parties at $40 thousand and $172 thousand on March 25, 2020 and April 15, 2020, respectively. Shares, resulting in the Company’s original shareholding ratio increased from 62.02% to 62.03%, and then increased to 62.05%, and the capital reserve was reduced by $20 thousand and $54 thousand, and the recognized retained earnings due to insufficient capital reserve decreased by $27 thousand. In addition, the board of directors resolved to cancel 191 thousand shares of the Company’s treasury shares on April 22, 2021, which increased the Company’s shareholding ratio from 62.05% to 62.43%, and the capital reserve was increased by $2,383 thousand. Later the board of directors resolved to issue employee stock option to raise capital on July 14, 2021. Because the Company did not subscribe the shares according to the shareholding ratio, the Company’s ownership was reduced from 62.43% to 59.66%, and the capital reserve increased by $1,461 thousand. Furthermore, stock dividends were issued on August 24, 2021, which increased the capital. The shareholding ratio of the Company increased from 59.66% to 59.67%, and the capital reserve increased by $67 thousand.

The Company purchased 8,250 thousand shares of ASJade Technology Inc. at $103,125 thousand on November 10, 2021. The Company’s shareholding ratio was 78.57%.

(6) Property, plant and equipment

Machinery equipment Cost: As of January 1, 2021 $15,493 Additional 8,530 Disposals (2,057) Reclassification 3,824 As of December 31, 2021 $25,790 As of January 1, 2020 $44,801 Additional 1,883 Disposals (31,191) As of December 31, 2020 $15,493 Depreciation and impairment loss: As of January 1, 2021 $8,143 Depreciation 4,031 Disposals (2,057) Reclassification - As of December 31, 2021 $10,117 As of January 1, 2020 $24,035 Depreciation 4,103 Disposals (19,995) As of December 31, 2020 $8,143 Net carrying amount as of: December 31, 2021 $15,673 December 31, 2020 $7,350	Machinery equipment	Office equipment	Leasehold improvement	Other	Total
	$15,493 8,530 (2,057) 3,824	$210 1,048 (210) -	$12,792 1,124 (1,185) -	$8,354 7,025 (1,571) (2,761)	$36,849 17,727 (5,023) 1,063
	$25,790	$1,048	$12,731	$11,047	$50,616
	$44,801 1,883 (31,191)	$366 - (156)	$8,407 5,668 (1,283)	$3,285 6,153 (1,084)	$56,859 13,704 (33,714)
	$15,493	$210	$12,792	$8,354	$36,849
		$210 25 (210) -	$3,711 2,351 (1,185) -	$3,380 2,523 (1,571) (1,035)	$15,444 8,930 (5,023) (1,035)
	$10,117	$25	$4,877	$3,297	$18,316
	$24,035 4,103 (19,995)	$338 28 (156)	$3,339 1,655 (1,283)	$2,390 2,074 (1,084)	$30,102 7,860 (22,518)
	$8,143	$210	$3,711	$3,380	$15,444
	$15,673	$1,023	$7,854	$7,750	$32,300
	$7,350	$-	$9,081	$4,974	$21,405

No Property, plant and equipment were pledged.

40

(7) Intangible assets

Cost: As of January 1, 2021 Addition-acquired separately As of December 31, 2021 As of January 1, 2020 Addition-acquired separately As of December 31, 2020 Amortization and impairment: As of January 1, 2021 Amortization As of December 31, 2021 As of January 1, 2020 Amortization As of December 31, 2020 Net carrying amount as of: December 31, 2021 December 31, 2020	Other
	$19,448 3,435
	$22,883
	$18,326 1,122
	$19,448
	$18,878 2,461
	$21,339
	$17,680 1,198
	$18,878
	$1,544
	$570

Amortization expense of intangible assets under the statement of comprehensive income:

Sales and marketing expenses General and administrative expenses Research and development expenses	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$34	$-
	$317	$320
	$2,110	$878

(8) Post-employment benefits

Defined contribution plan

The Company adopt a defined contribution plan in accordance with the Labor Pension Act of the R.O.C. Under the Labor Pension Act, the Company will make monthly contributions of no less than 6% of the employees’ monthly wages to the employees’ individual pension accounts. The Company have made monthly contributions of 6% of each individual employee’s salaries or wages to employees’ pension accounts.

Expenses under the defined contribution plan for the years ended December 31, 2021 and 2020 were $14,050 thousand and $13,565 thousand, respectively.

41

Defined benefits plan

The Company adopt a defined benefit plan in accordance with the Labor Standards Act of the R.O.C. The pension benefits are disbursed based on the units of service years and the average salaries in the last month of the service year. Two units per year are awarded for the first 15 years of services while one unit per year is awarded after the completion of the 15th year. The total units shall not exceed 45 units. Under the Labor Standards Act, the Company contribute an amount equivalent to 2% of the employees’ total salaries and wages on a monthly basis to the pension fund deposited at the Bank of Taiwan in the name of the administered pension fund committee. Before the end of each year, the Company assess the balance in the designated labor pension fund. If the amount is inadequate to pay pensions calculated for workers retiring in the same year, the Company will make up the difference in one appropriation before the end of March the following year.

The Ministry of Labor is in charge of establishing and implementing the fund utilization plan in accordance with the Regulations for Revenues, Expenditures, Safeguard and Utilization of the Labor Retirement Fund. The pension fund is invested in-house or under mandate, based on a passive-aggressive investment strategy for long-term profitability. The Ministry of Labor establishes checks and risk management mechanism based on the assessment of risk factors including market risk, credit risk and liquidity risk, in order to maintain adequate manager flexibility to achieve targeted return without over-exposure of risk. With regard to utilization of the pension fund, the minimum earnings in the annual distributions on the final financial statement shall not be less than the earnings attainable from the amounts accrued from twoyear time deposits with the interest rates offered by local banks. Treasury Funds can be used to cover the deficits after the approval of the competent authority. As the Company does not participate in the operation and management of the pension fund, no disclosure on the fair value of the plan assets categorized in different classes could be made in accordance with paragraph 142 of IAS 19. The Company expects to contribute $165 thousand to its defined benefit plan during the 12 months beginning after December 31, 2021.

As of December 31, 2021 and 2020, the Company’s definite benefit plans are expected to expire in 2037 and 2038.

Pension costs recognized in profit or loss for the years ended December 31, 2021 and 2020:

Current period service costs Net interest of defined benefit liability (asset) Total	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$934 117	$812 251
	$1,051	$1,063

42

Changes in the defined benefit obligation and fair value of plan assets are as follows:

Defined benefit obligation Plan assets at fair value Other non-current liabilities – Accrued net defined benefit liabilities recognized on the parent company only balance sheets		As of
	December 31, 2021	December 31, 2020	January 1, 2020
	$67,812 (25,784)	$63,017 (25,163)	$53,593 (24,012)
	$42,028	$37,854	$29,581

Reconciliation of liability (asset) of the defined benefit plan is as follows:

As of January 1, 2020 Current period service costs Net interest expense (income) Subtotal Remeasurements of the net defined benefit liability (asset): Actuarial gains and losses arising from changes in demographic assumptions Actuarial gains and losses arising from changes in financial assumptions Experience adjustments Return on plan assets Subtotal Contributions by employer As of December 31, 2020 Current period service costs Net interest expense (income) Subtotal Remeasurements of the net defined benefit liability (asset): Actuarial gains and losses arising from changes in demographic assumptions Actuarial gains and losses arising from changes in financial assumptions Experience adjustments Return on plan assets Subtotal Contributions by employer As of December 31, 2021	Defined benefit obligation	Fair value of plan assets	Net benefit liability (asset)
	$53,593 812 456	$(24,012) - (205)	$29,581 812 251
	54,861	(24,217)	30,644
	2,512 5,492 152 -	- - - (792)	2,512 5,492 152 (792)
	8,156	(792)	7,364
	-	(154)	(154)
	63,017 934 195	(25,163) - (78)	37,854 934 117
	64,146	(25,241)	38,905
	(1,603) (3,833) 9,102 -	- - - (379)	(1,603) (3,833) 9,102 (379)
	3,666	(379)	3,287
	-	(164)	(164)
	$67,812	$(25,784)	$42,028

43

The major categories of plan assets as a percentage of the fair value of the total plan assets are as follows:

Cash Equity instrument Debt instrument Others Total	Pensionplan(%)	Pensionplan(%)
	As of December31,
	2021	2020
	15.25% 49.91% 23.11% 11.73%	16.61% 52.93% 15.80% 14.66%
	100.00%	100.00%

The following significant actuarial assumptions are used to determine the present value of the defined benefit obligation:

defined benefit obligation:
Discount rate Expected rate of salary increases	As of December31,
	2021	2020
	0.64% 3.00%	0.31% 3.00%

A sensitivity analysis for significant assumption as at December 31, 2021 and 2020 is, as shown below:

shown below:
Discount rate increase by 0.5% Discount rate decrease by 0.5% Expected salary level increase by 0.5% Expected salary level decrease by 0.5%	For theyears ended December 31,
	2021		2020
	Increase in defined benefit obligation	Decrease in defined benefit obligation	Increase in defined benefit obligation	Decrease in defined benefit obligation
	$- 5,797 5,629 -	$5,295 - - 5,203	$- 5,787 5,600 -	$5,256 - - 5,149

The sensitivity analyses above are based on a change in a significant assumption (for example: change in discount rate or expected salary), keeping all other assumptions constant. The sensitivity analyses may not be representative of an actual change in the defined benefit obligation as it is unlikely that changes in assumptions would occur in isolation of one another.

There was no change in the methods and assumptions used in preparing the sensitivity analyses compared to the previous period.

(9) Equities

A. Common stock

The Company’s authorized capital were both $1,500,000 thousand as of December 31, 2021 and 2020 (Both reserve $40,000 thousand of shares for employee stock options). The Company’s issued capital were $1,229,254 thousand and $1,206,424 thousand as of December 31, 2021 and 2020, respectively, each at a par value of $10. The Company issued 122,925,429 and 120,642,429 common shares as of December 31, 2021 and 2020, respectively. Each share has one voting right and a right to receive dividends.

44

The Company issued 2,300 thousand shares of restricted stock awards, which was resolved at the shareholders’ meeting held on August 20, 2021. The total number of new shares issued on October 28, 2021 was 2,283 thousand shares at a per value of $10, totaling $22,830 thousand.

B. Capital surplus

Capital surplus
Additional paid-in capital Difference between consideration given/received and carrying amount of interests in subsidiaries acquired disposed of Increase (decrease) through changes in ownership interests in subsidiaries Retired stock to employees Total	As of December 31,
	2021	2020
	$3,127,994 335 10,012 194,010	$3,127,994 335 6,376 -
	$3,332,351	$3,134,705

According to the Company Act, the capital reserve shall not be used except for making good the deficit of the company. When a company incurs no loss, it may distribute the capital reserves related to the income derived from the issuance of new shares at a premium or income from endowments received by the company. The distribution could be made in cash or in the form of dividend shares to its shareholders in proportion to the number of shares being held by each of them.

C. Treasury stock

On January 3, 2020, the treasury stocks in the amount of $48 thousand in 5 thousand shares were repurchased due to the expiration of restricted employee awards by the resolution of the board of directors on April 29, 2020. The base date for a capital reduction was set on May 29, 2020. The statutory change of registration procedure has been completed.

• D. Retained earnings and dividend policies

According to the Company’s Articles of Incorporation, current year’s earnings, if any, shall be distributed in the following order:

• a. Payment of all taxes and dues;

• b. Offset prior years’ operation losses;

• c. Set aside 10% of the remaining amount as legal reserve;

• d. Set aside or reverse special reserve in accordance with law and regulations; and

• e. The distribution of the remaining portion, if any, will be recommended by the Board of Directors and resolved in the shareholders’ meeting.

The policy of dividend distribution should reflect factors such as the current and future investment environment, fund requirements, domestic and international competition and capital budgets; as well as the interest of the shareholders, dividend appropriateness and long-term financial planning etc. The Board of Directors shall make the distribution proposal annually and the Company held a general meeting of shareholders on June 12, 2019 and passed a resolution to amend the company’s articles of association, stating that if all or part of the dividends and bonuses are distributed in cash, the Board of Directors is authorized to make two-thirds The above-mentioned directors attend, and after more than half of the attending directors agree, and report to the shareholders' meeting; the share dividends must be submitted to the shareholders' meeting for resolution of distribution. The Company’s Articles of Incorporation further provide that at least 10% of the dividends must be paid in the form of cash.

45

According to the Company Act, the Company needs to set aside amount to legal reserve unless where such legal reserve amounts to the total paid-in capital. The legal reserve can be used to make good the deficit of the Company. When the Company incurs no loss, it may distribute the portion of legal serve which exceeds 25% of the paid-in capital by issuing new shares or by cash in proportion to the number of shares being held by each of the shareholders.

When the Company distributing distributable earnings, it shall set aside to special reserve, an amount equal to “other net deductions from shareholders” equity for the current fiscal year, provided that if the company has already set aside special reserve according to the requirements for the adoption of IFRS, it shall set aside supplemental special reserve based on the difference between the amount already set aside and other net deductions from shareholders’ equity. For any subsequent reversal of other net deductions from shareholders’ equity, the amount reversed may be distributed from the special reserve.

The FSC on 31 March 2021 issued Order No. Financial-Supervisory-Securities-Corporate1090150022, which sets out the following provisions for compliance:

On a public company's first-time adoption of the IFRS, for any unrealized revaluation gains and cumulative translation adjustments (gains) recorded to shareholders’ equity that the company elects to transfer to retained earnings by application of the exemption under IFRS 1, the company shall set aside special reserve. For any subsequent use, disposal or reclassification of related assets, the Company can reverse the special reserve by the proportion of the special reserve first appropriated and distribute it.

Details of the 2021 and 2020 earnings distribution and dividends per share as approved by the board of directors’ meeting and shareholders’ meeting on February 23, 2022 and August 20, 2021, respectively, are as follows:

Legal reserve Special reserve Common stock - cash dividend	Appropriation of earnings	Appropriation of earnings	Dividendper share($)	Dividendper share($)
	2021	2020	2021	2020
	$237,843 109,101 1,598,031	$135,666 193,320 965,139	$13.00	$8.00

Please refer to Note 6(14) for details on employees’ compensation and remuneration to directors and supervisors.

46

(10) Share-based payment plans

Certain employees of the Company are entitled to share-based payment as part of their remunerations; services are provided by the employees in return for the equity instruments granted. These plans are accounted for as equity-settled share-based payment transactions.

• (a) Restricted stock plan for employee of the Company

The Company issued 2,300 thousand shares of restricted stock awards, which was resolved at the shareholders’ meeting held on August 20, 2021. The grantees are limited to full-time employees of the Company who meet specific requirements. The Company has already filed with the Securities and Futures Bureau of the FSC for approval of the issuance and was approved. The total number of new shares issued on October 28, 2021 was 2,238 thousand shares. The stock price on the grant date was $145 per share.

Employees who have been granted the above-mentioned restricted stock awards can subscribe to the shares for $10 with vesting conditions as follows:

• I. The company’s performance

• If EPS in the previous year is better than $10, the overall weight will be 100%.

• If EPS in the previous year is between $7.5 and $10, the overall weight will be 50%.

• If EPS in the previous year is below $7.5, the overall weight will be 0%.

• II. Personal performance

• If the mid-year assessment is better than A (include A), the personal weight will be 100%.

• If the mid-year assessment is between B+ to A (excluding A), the personal will be weight 80%.

• If the mid-year assessment is between B to B+ (excluding B+), the personal will be weight 60%

• If the mid-year assessment is C, the personal weight will be 0%

• III. Employees who have been granted the above-mentioned restricted stock awards and have continued to serve in the company for one year from the grant date, and have not violated any laws, articles of incorporation, business ethics and code of conduct and other relevant regulations and agreements during their employment, can receive 40% of the vested shares multiplied by overall weight and personal weight.

• IV. Employees who have been granted the above-mentioned restricted stock awards and have continued to serve in the company for two years from the grant date, and have not violated any laws, articles of incorporation, business ethics and code of conduct and other relevant regulations and agreements during their employment, can receive 30% of the vested shares multiplied by overall weight and personal weight.

47

• V. Employees who have been granted the above-mentioned restricted stock awards and have continued to serve in the company for three years from the grant date, and have not violated any laws, articles of incorporation, business ethics and code of conduct and other relevant regulations and agreements during their employment, can receive 30% of the vested shares multiplied by overall weight and personal weight.

The vested new restricted stock awards shall be entrusted and may not be sold, pledged, transferred, gifted to others, created lien or otherwise disposed of in any other manner before the vested conditions are met. According to the parent company’s new share issuance measures for restricted stock awards, after the new shares with restricted stock awards are issued, except for the restricted stock awards that are delivered to a trust and those that do not meet the vested conditions under the parent company’s issuance measures, the rights of the other restricted stock are the same as the common shares issued by the company.

The detailed information of the above restricted stock awards are as follows:

Vested period Original number of shares Operating performance issue ratio Estimated turnover rate Qualified rate of performance Vested shares Embedded value Labor cost	Restricted stock to employee	Restricted stock to employee	Restricted stock to employee	Restricted stock to employee
	1years	2years	3years	Total
	913,200 99.72% 9.45% 76.92% 634,273 $145 $85,627	684,900 94.92% 16.03% 76.92% 419,902 $145 $56,687	684,900 90.86% 20.00% 76.92% 382,939 $145 $51,696	2,283,000 1,437,114 $194,010

The new shares issued by the Company that restrict the rights of employees cannot be transferred within three years of the vesting period, but they still have the right to vote and distribute dividends. If an employee who has been allocated the restricted employee rights new shares resigns during the vesting period, he must return the restricted employee rights stock and the dividends already obtained.

(b) Modification or cancellation of the share-based payment plan for employees

No modification or cancellation of share-based payment plan has occurred in the year ended December 31, 2021.

48

• (c) The expense recognized for employee services received during the years ended December 31, 2021 and 2020, is shown in the following table:

Expense arising from share-based payment transaction (All of arising from equity-settled share-based payment transaction)(Note)	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$39,231	$22,655

• Note: The board of directors of the subsidiary company -ASROCK RACK INCORPORATION resolved to issue shares of restricted stock awards on May 29, 2020. The grantees are limited to full-time employees of The Company and ASROCK RACK INCORPORATION. The Company recognized an expense of $55 and $82 thousand for the above-mentioned share basic payment transaction in 2021 and 2020.

(11) Operating revenue

The Company's revenue from contracts with customers in 2021 and 2020:

A. Disaggregation of revenue

Revenue from contracts with customers Sale of goods Revenue arising from rendering services Total	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$14,510,756 24,497	$12,565,660 12,063
	$14,535,253	$12,577,723

• B. The Company’s revenue from contracts with customers is recognized at certain points in time.

(12) Expected credit losses

Operating expenses – expected credit losses Accounts receivables	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$3,688	$345

Please refer to Note 12 for more details on credit risk.

49

The credit risk for the Company’s financial assets measured at amortized cost are assessed as low as of December 31, 2021 and 2020 (The same as the assessment result of January 1, 2020). Since the transaction counterparties of the Company are all financial institutions such as banks with good credit, all of them are calculated based on the expected credit loss rate of 0% and the allowance loss amount is $0.

The Company measures the loss allowance of its trade receivables (including accounts receivable) at an amount equal to lifetime expected credit losses. The assessment of the Company’s loss allowance as of December 31, 2021 and 2020 are as follows:

The Company considers the Companying of Trade receivables by counterparties’ credit rating, by geographical region and by industry sector and its loss allowance is measured by using a provision matrix, details are as follows:

As of December 31, 2021

Gross carrying amount Loss ratio Lifetime expected credit losses Net carrying amount	Not yet due			Overdue			Total
		Under 30 days	31~ 60days	61~ 90days	91~ 120days	Over 121 days
	$1,563,820 0.44%	$34,892 0.69%	$10,221 0.10%	$7,855 0.00%	$7,254 0.00%	$84,406 1.86%	$1,708,448 8,689
	6,871	242	10	-	-	1,566
	$1,556,949	$34,650	$10,211	$7,855	$7,254	$82,840	$1,699,759

As of December 31, 2020

Gross carrying amount Loss ratio Lifetime expected credit losses Net carrying amount	Not yet due			Overdue			Total
		Under 30 days	31~ 60days	61~ 90days	91~ 120days	Over 121 days
	$1,957,503 0.16%	$38,231 0.69%	$9,311 0.00%	$31,920 0.00%	$44 0.00%	$1,612 100.00%	$2,038,621 5,001
	3,125	264	-	-	-	1,612
	$1,954,378	$37,967	$9,311	$31,920	$44	$-	$2,033,620

50

The movement in the provision for impairment of trade receivables during the years ended December 31, 2021 and 2020 is as follows:

As of January 1, 2021 Addition/(reversal) for the current period Write off As of December 31, 2021 As of January 1, 2020 Addition/(reversal) for the current period Write off As of December 31, 2020	Accounts receivables
	$5,001 3,688 -
	$8,689
	Accounts receivables
	$4,656 345 -
	$5,001

• (13) Leases

Company as a lessee

The Company leases various properties, including real estate such as land and buildings, and parking space. The lease terms range from 1 to 5 years. The Company is not subject to any special restrictions.

The Company’s leases effect on the financial position, financial performance and cash flows are as follows:

• A. Amounts recognized in the balance sheet

• (a) Right-of-use assets

The carrying amount of right-of-use assets

The carrying amount of right-of-use assets
Buildings	As of December 31,
	2021	2020
	$30,010	$30,671

During the years ended December 31, 2021 and 2020, the Company’s additions to right-of-use assets amounting to $14,734 thousand and $21,191, respectively.

51

(b) Lease liabilities

Lease liabilities Current Non-current	As of December 31,	As of December 31,
	2021	2020
	$30,145	$30,905
	$15,322	$13,674
	$14,823	$17,231

Please refer to Note 6(15)D. for the interest on lease liabilities recognized during the years ended December 31, 2021 and 2020 and refer to Note 12(5) Liquidity Risk Management for the maturity analysis for lease liabilities.

• B. Amounts recognized in the statement of profit or loss

Depreciation charge for right-of-use assets

Buildings	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$15,395	$14,057

• C. Income and costs relating to leasing activities

The expenses relating to variable lease payments not included in the measurement of lease liabilities	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$11,248	$7,833

• D. Cash outflow relating to leasing activities

During the years ended December 31, 2021 and 2020, the Company’s total cash outflows for leases amounting to $26,970 thousand and $22,212 thousand, respectively.

52

• (14) Summary statement of employee benefits, depreciation and amortization expenses by function:

		For theyears ended December 31,	For theyears ended December 31,	For theyears ended December 31,	For theyears ended December 31,
		2021			2020
	Operating costs	Operating expenses	Total	Operating costs	Operating expenses	Total
Employee benefits expense
Salaries	$-	$848,590	$848,590	$-	$604,098	$604,098
Labor and health insurance	-	33,538	33,538	-	26,675	26,675
Pension	-	15,101	15,101	-	14,628	14,628
Remuneration to directors	-	23,795	23,795	-	13,338	13,338
Other employee benefits expense	-	22,075	22,075	-	20,899	20,899
Depreciation expense	-	24,325	24,325	-	21,917	21,917
Amortization expense	-	2,461	2,461	-	1,198	1,198

• i. The Company’s average number of employees on December 31, 2021 and 2020, were 320 and 331 people, respectively, of which 6 people were directors, who were not concurrently employees.

• ii. The Cost of average employee benefits on December 31, 2021 and 2020, amounting to $2,928 thousand and $2,050 thousand, respectively. The Cost of average employee salaries on December 31, 2021 and 2020, amounting to $2,703 thousand and $1,859 thousand, respectively. The average of employee salaries raises to 45.37%.

• iii. In accordance with the Securities and Exchange Act, the Company established the Audit Committee to replace the supervisors. Therefore the supervisors’ remuneration were $0 on December 31, 2021 and 2020.

• iv. The Company has set up a remuneration committee to determine the performance evaluation and remuneration of directors, supervisors and managers, and regularly evaluate the remuneration of directors, supervisors and managers based on principles such as peer standards and company operating performance. Directors’ remuneration is mainly based on the company’s articles of association, based on the net profit before tax deducting director’s remuneration and employee remuneration, and no more than 1% is allocated as directors’ remuneration. The company’s overall operating results and the degree of participation by each director in the company’s operations are considered Reasonable remuneration. The remuneration of managers and employees includes a regular monthly salary (including principal salary and food allowance, etc.) based on personal academic experience, professional technical ability, and professional years of experience. In addition, it is based on company operating performance, personal seniority and performance. After consideration, relevant year-end bonuses, cash bonuses and performance bonuses will be issued.

53

According to the Articles of Incorporation, 5% of profit of the current year is distributable as employees’ compensation and no higher than 1% of profit of the current year is distributable as remuneration to directors and supervisors. However, the Company’s accumulated losses shall have been covered. The Company may, by a resolution adopted by a majority vote at a board meeting attended by two-thirds of the total number of directors, have the profit distributed as employees’ compensation in the form of shares or in cash; and in addition thereto a report of such distribution is submitted to the shareholders’ meeting. If the Board of Directors subsequently modifies the estimates significantly, the Company will recognize the change as an adjustment in the profit or loss in the subsequent period. Estimated employee remuneration and directors’ remuneration are recognized as expenses in the current year. If there is a significant change in the amount determined by the board meeting resolution in the following year, it will be treated according to the changes in accounting estimates and the profit and loss of the following year will be adjusted. Information on the board meeting resolution regarding the employees’ compensation and remuneration to directors and supervisors can be obtained from the “Market Observation Post System” on the website of the TWSE.

Based on profit of the year ended December 31, 2021, the Company estimated the amounts of the employees’ compensation and remuneration to directors and supervisors for the year ended December 31, 2021 to be 7.610% of profit of the current year and 0.761% of profit of the current year, respectively, recognized as employee benefits expense. As such, employees’ compensation and remuneration to directors for the year ended December 31, 2021 amounted to $237,954 thousand and $23,795 thousand, respectively and recognized as salaries expense. A resolution was passed at the board meeting held on February 23, 2022 to distribute $237,954 thousand and $23,795 thousand in cash as employees’ compensation and remuneration to directors of 2021, respectively.

A resolution was passed at the board meeting held on February 24, 2021 to distribute $129,435 thousand and $12,944 thousand in cash as employees’ compensation and remuneration to directors of 2020, respectively. No material differences exist between the estimated amount and the actual distribution of the employee compensation and remuneration to directors and supervisors for the year ended December 31, 2020.

54

A resolution was passed at the board meeting held on March 12, 2019 to distribute $49,731 thousand and $4,973 thousand in cash as employees’ compensation and remuneration to directors of 2019, respectively. No material differences exist between the estimated amount and the actual distribution of the employee compensation and remuneration to directors and supervisors for the year ended December 31, 2019.

(15) Non-operating income and expenses

A. Interest income

For the years ended December 31,

Interest income Financial assets measured at amortized cost	2021	2020
	$8,503	$12,009

• B. Other income

Other income - others	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$111,510	$84,963

• C. Other gains and losses

For the years ended December 31,

Gains on disposal of property, plant and equipment Foreign exchange losses, net Total	2021	2020
	$20 (41,279)	$- (48,913)
	$(41,259)	$(48,913)

• D. Finance costs

For the years ended December 31,

Interest on lease liabilities	2021	2020
	$235	$312

55

(16) Components of other comprehensive income

For the year ended December 31, 2021

Items that will not be reclassified subsequently to profit or loss: Losses on remeasurements of defined benefit plans Items that may be reclassified subsequently to profit or loss: Share of other comprehensive income of subsidiaries, associates and joint ventures accounted for using equity method Total For the year ended December 31, Items that will not be reclassified subsequently to profit or loss: Losses on remeasurements of defined benefit plans Items that may be reclassified subsequently to profit or loss: Share of other comprehensive income of subsidiaries, associates and joint ventures accounted for using equity method Total	Arising during theperiod	Reclassification adjustments during the period	Other comprehensive income, before tax	Income tax relating to components of other comprehensive income	Other comprehensive income, net of tax
	$(3,287) (109,101)	$- -	$(3,287) (109,101)	$657 -	$(2,630) (109,101)
	$(112,388)	$-	$(112,388)	$657	$(111,731)
	2020 Arising during theperiod	Reclassification adjustments during the period	Other comprehensive income, before tax	Income tax relating to components of other comprehensive income	Other comprehensive income, net of tax
	$(7,364) (193,321)	$- -	$(7,364) (193,321)	$1,473 -	$(5,891) (193,321)
	$(200,685)	$-	$(200,685)	$1,473	$(199,212)

56

(17) Income tax

The major components of income tax expense for the years ended December 31, 2021 and 2020 are as follows:

Income tax expense recognized in profit or loss

For theyears ended December 31, 2021 2020 Current income tax expense (income): Current income tax charge $488,138 $215,202 Adjustments in respect of current income tax of prior periods (102) (10,918) Deferred tax expense: Deferred tax expense (income) relating to origination and reversal of temporary differences (3,982) (8,899) Total income tax expense $484,054 $195,385 Income tax relating to components of other comprehensive income	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$488,138 (102) (3,982)	$215,202 (10,918) (8,899)
	$484,054	$195,385

For theyears ended December 31, 2021 2020 Deferred tax expense: Profit or losses of defined benefits plan $(657) $(1,473) Income tax relating to components of other comprehensive income $(657) $(1,473) Reconciliation between tax expense and the product of accounting profit multiplied by applicable tax rates is as follows:	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$(657)	$(1,473)
	$(657)	$(1,473)

Accounting profit before tax from continuing operations Tax at the domestic rates applicable to profits in the country concerned Tax effect of revenues exempt from taxation Income tax impact of research and development deduction Corporate income surtax on undistributed retained earnings Adjustments in respect of current income tax of prior periods Other Total income tax expense recognized in profit or loss	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$2,856,114	$1,558,477
	$573,023 (65,799) (26,745) 3,126 (102) 551	$311,695 (82,338) (23,581) - (10,918) 527
	$484,054	$195,385

57

Deferred tax assets (liabilities) relate to the following:

For the year ended December 31, 2021

Temporary differences Unrealized gains (losses) on foreign exchange Unrealized intracompany profits and losses Inventory valuation and obsolescence loss Net defined benefit liabilities-non current Other payables (non-leave bonus, etc.) Deferred tax income(expense) Net deferred tax assets(liabilities) Reflected in balance sheet as follows: Deferred tax assets Deferred tax liabilities	Beginning balance	Recognized in profit or loss	Recognized in other comprehensive income	Exchange differences	Ending balance
	$(228) 26,662 8,174 7,571 867	$1,866 (4,896) 6,835 177 -	$- - - 657 -	$- - - - -	$1,638 21,766 15,009 8,405 867
	$43,046	$3,982	$657	$-	$47,685
	$43,274				$47,685
	$(228)				$-

For the year ended December 31, 2020

Temporary differences Unrealized gains (losses) on foreign exchange Unrealized intracompany profits and losses Inventory valuation and obsolescence loss Net defined benefit liabilities-non current Other payables (non-leave bonus, etc.) Deferred tax income(expense) Net deferred tax assets(liabilities) Reflected in balance sheet as follows: Deferred tax assets Deferred tax liabilities	Beginning balance	Recognized in profit or loss	Recognized in other comprehensive income	Exchange differences	Ending balance
	$2,453 16,291 7,147 5,916 867	$(2,681) 10,371 1,027 182 -	$- - - 1,473 -	$- - - - -	$(228) 26,662 8,174 7,571 867
	$32,674	$8,899	$1,473	$-	$43,046
	$32,674				$43,274
	$-				$(228)

58

Unrecognized deferred tax liabilities relating to the investment in subsidiaries

The Company did not recognize any deferred tax liability for taxes that would be payable on the unremitted earnings of the Company’s overseas subsidiaries, as the Company has determined that undistributed profits of its subsidiaries will not be distributed in the foreseeable future. As of December 31, 2021 and 2020, the taxable temporary differences associated with investment in subsidiaries, for which deferred tax liabilities have not been recognized, aggregate to $2,970,228 thousand and $2,862,904 thousand, respectively.

The assessment of income tax returns

As of December 31, 2021, the assessment of the income tax returns of the Company is as follows:

The Company	The assessment of income tax returns	Notes
	Assessed and approved up to 2019	None

(18) Earnings per share

Basic earnings per share amounts are calculated by dividing net profit for the year attributable to ordinary equity holders of the parent entity by the weighted average number of ordinary shares outstanding during the year.

Diluted earnings per share amounts are calculated by dividing the net profit attributable to ordinary equity holders of the parent entity (after adjusting for interest on the convertible preference shares) by the weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares.

A. Basic earnings per share Profit attributable to ordinary equity holders of the Company (in thousand $) Weighted average number of ordinary shares outstanding for basic earnings per share (in thousands) Basic earnings per share ($) B. Diluted earnings per share Profit attributable to ordinary equity holders of the Company (in thousand $) Weighted average number of ordinary shares outstanding for basic earnings per share (in thousands) Effect of dilution: Employee compensation－stock (in thousands) Weighted average number of ordinary shares outstanding after dilution (in thousands) Diluted earnings per share ($)	For the years ended December 31,	For the years ended December 31,
	2021	2020
	$2,381,060	$1,363,092
	121,049	120,642
	$19.67	$11.30
	$2,381,060	$1,363,092
	121,049 846	120,642 830
	121,895	121,472
	$19.53	$11.22

There have been no other transactions involving ordinary shares or potential ordinary shares between the reporting date and the date of completion of the financial statements.

59

7. Related party transactions

Information of the related parties that had transactions with the Company during the financial reporting period is as follows:

Name and nature of relationship of the related parties

Name of the relatedparties PEGATRON Corporation ASIAROCK TECHNOLOGY LIMITED ASRock Europe B.V. ASRock America, Inc. ASROCK RACK INCORPORATION ASRock Industrial Computer Corporation ASJade Technology Inc. AS FLY TRAVEL SERVICE CO.	Nature of relationshipof the relatedparties
	The parent company The Company’s subsidiary The Company’s subsidiary The Company’s subsidiary The Company’s subsidiary The Company’s subsidiary The Company’s subsidiary Substantive related party

Significant transactions with the related parties

(a) Sales

For the years ended December 31,

Subsidiaries ASRock America, Inc. ASRock Europe B.V. Others Total	2021	2020
	$3,731,808 3,896,085 161,971	$4,066,728 3,388,098 27,219
	$7,789,864	$7,482,045

The sales price to the above related parties was determined through mutual agreement based on the market rates. The collection period for related parties sales was O/A 45~90 days. The collection period for non-related parties sales were TT or 30~90 days . The outstanding balance at December 31, 2021 and 2020 was unsecured, non-interest bearing and must be settled in cash. The receivables from the related parties were not guaranteed.

60

(b) Purchases

Parent Company Subsidiaries ASIAROCK TECHNOLOGY LIMITED Others Total	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$8 10,335,480 41,891	$- 10,838,232 3,829
	$10,377,379	$10,842,061

The purchase price to the above related parties was determined through mutual agreement based on the market rates. The payment terms from the related party suppliers are comparable with third party suppliers and are TT or 30~90 days.

(c) Accounts receivable - related parties

Subsidiaries ASRock America, Inc. Others Total	As of December 31,	As of December 31,
	2021	2020
	$767,816 111,317	$1,442,790 149,221
	$879,133	$1,592,011

(d) Prepayments

Parent Company Subsidiaries ASIAROCK TECHNOLOGY LIMITED Total	As of December 31,	As of December 31,
	2021	2020
	$1,520 733,600	$2,149 -
	$735,120	$2,149

(e) Other current assets

Subsidiaries ASIAROCK TECHNOLOGY LIMITED ASROCK RACK INCORPORATION ASRock Industrial Computer Corporation Others Total	As of December 31,	As of December 31,
	2021	2020
	$8,439 14,882 7,211 2,487	$- 14,744 4,884 617
	$33,019	$20,245

61

(f) Accounts payable - related parties

Subsidiaries ASIAROCK TECHNOLOGY LIMITED Others Total	As of December 31,	As of December 31,
	2021	2020
	$490,723 37,247	$2,188,109 -
	$527,970	$2,188,109

(g) Other payables

Parent Company PEGATRON Corporation Subsidiaries Total	As of December 31,	As of December 31,
	2021	2020
	$26,888 3,973	$1,952 906
	$30,861	$2,858

(h) Other current liabilities

Parent Company Subsidiaries ASIAROCK TECHNOLOGY LIMITED ASRock America, Inc. Total	As of December 31,	As of December 31,
	2021	2020
	$3 37,875 81,727	$3 - 48,233
	$119,605	$48,236

(i) Operating expenses

Parent Company Subsidiaries ASRock Europe B.V. Others Other related parties Total	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$3,770 490 354 3	$1,111 1,287 481 1,320
	$4,617	$4,199

62

(j) Manufacturing overhead

anufacturing overhead
ParentCompany PEGATRON Corporation	For theyears ended December 31,
	2021	2020
	$32,714	$-

• (k) Other revenue

Subsidiaries ASROCK RACK INCORPORATION ASRock Industrial Computer Corporation Others Total	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$48,000 18,171 16,916	$54,254 14,506 12,018
	$83,087	$80,778

• (l) Property transaction

Acquisition of intangible assets:

Parent Company	Asset Name	For theyears ended December 31,	For theyears ended December 31,
		2021 $743	2020
	Computer software		$749

The Company's purchase price of computer software from the parent company was negotiated by bother parties referencing the market price.

Sale of fixed assets:

For the year ended December 31, 2021:

None.

For the year ended December 31, 2020:

Related Parties	Asset Name	Sale Price	Gain(Loss) of Disposal
Subsidiaries	Machinery equipment	$11,196	$-

63

(m) Key management personnel compensation

Short-term employee benefits Post-employment benefits Share-based payment Total	For theyears ended December 31,	For theyears ended December 31,
	2021	2020
	$107,084 676 6,775	$61,013 620 3,913
	$114,535	$65,546

8. Assets pledged as security

None.

9. Significant contingencies and unrecognized contractual commitments

• (1) Reversible Connections Inc. ("Reversible") filed a patent infringement lawsuit against ASRock America, Inc., a subsidiary of the Company, in 2017, claiming that ASRock America, Inc. infringed its '825 patent on several products sold in the United States. The Company denied these allegations and defended the case strongly. A lawyer has been appointed to cooperate with the court in the trial. The Company's operations, finances, and business remained normal and were not affected by the case.

• (2) As of December 31, 2021, the Company recorded customs duties of $10,000 thousand.

10. Losses due to major disasters

None.

11. Significant subsequent events

None.

12. Other

• (1) Categories of financial instruments

Financial assets

Financial assets
Financial assets measured at amortized cost: Cash and cash equivalents (exclude cash on hand) Financial assets measured at amortized cost Trade receivables Other receivables Total	As of December 31,
	2021	2020
	$1,030,820 860,000 1,699,759 39,976	$1,507,927 486,206 2,033,620 20,119
	$3,630,555	$4,047,872

64

Financial liabilities

Financial liabilities
Financial liabilities measured at amortized cost: Accounts payables Lease liabilities Other payables Total	As of December 31,
	2021	2020
	$600,357 30,145 691,173	$2,205,944 30,905 410,447
	$1,321,675	$2,647,296

(2) Financial risk management objectives and policies

The Company’s principal financial risk management objective is to manage the market risk, credit risk and liquidity risk related to its operating activities. The Company identifies measures and manages the aforementioned risks based on the Company’s policy and risk appetite.

The Company has established appropriate policies, procedures and internal controls for financial risk management. Before entering into significant transactions, due approval process by the Board of Directors and Audit Committee must be carried out based on related protocols and internal control procedures. The Company complies with its financial risk management policies at all times.

(3) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of the changes in market prices. Market prices comprise currency risk, interest rate risk.

In practice, it is rarely the case that a single risk variable will change independently from other risk variable, there is usually interdependencies between risk variables. However, the sensitivity analysis disclosed below does not take into account the interdependencies between risk variables.

Foreign currency risk

The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to the Company’s operating activities (when revenue or expense are denominated in a different currency from the Company’s functional currency) and the Company’s net investments in foreign subsidiaries.

65

The Company has certain foreign currency receivables to be denominated in the same foreign currency with certain foreign currency payables, therefore natural hedge is received. Hedge accounting is not applied as they did not qualify for hedge accounting criteria. Furthermore, as net investments in foreign subsidiaries are for strategic purposes, they are not hedged by the Company.

The foreign currency sensitivity analysis of the possible change in foreign exchange rates on the Company’s profit is performed on significant monetary items denominated in foreign currencies as at the end of the reporting period. The Company’s foreign currency risk is mainly related to the volatility in the exchange rates for foreign currency USD. The information of the sensitivity analysis is as follows:

When NTD strengthens/weakens against foreign currency USD by 1%, the profit for the years ended December 31, 2021 and 2020 is decreased/increased by $16,222 thousand and $13,182 thousand, respectively, the equity is decreased/increased by $38,186 thousand and $37,520 thousand, respectively.

Interest rate risk

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s cash in banks and time deposit at variable interest rates.

The interest rate sensitivity analysis is performed on items exposed to interest rate risk as at the end of the reporting period. At the reporting date, a change of 25 basis points of interest rate in a reporting period could cause the profit for the years ended December 31, 2021 and 2020 to increase /decrease by $4,449 thousand and $2,311 thousand, respectively.

• (4) Credit risk management

Credit risk is the risk that a counterparty will not meet its obligations under a contract, leading to a financial loss.

The Company is exposed to credit risk from operating activities (primarily for accounts and notes receivables) and from its financing activities, including bank deposits and other financial instruments.

Credit risk is managed by each business unit subject to the Company’s established policy, procedures and control relating to credit risk management. Credit limits are established for all counter parties based on their financial position, rating from credit rating agencies, historical experience, prevailing economic condition and the Company’s internal rating criteria etc. Certain counter parties’ credit risk will also be managed by taking credit enhancing procedures, such as requesting for prepayment.

66

As of December 31, 2021 and 2020, trade receivables from top ten customers represent 79.53% and 93.18% of the total trade receivables of the Company, respectively. The credit concentration risk of other trade receivables is insignificant.

Credit risk from balances with banks, fixed income securities and other financial instruments is managed by the Company’s treasury in accordance with the Company’s policy. The Company only transacts with counterparties approved by the internal control procedures, which are banks and financial institutions, companies and government entities with good credit rating. Consequently, there is no significant credit risk for these counter parties.

The Company adopted IFRS 9 to assess the expected credit losses. The Company measures the loss allowance of its trade receivables at an amount equal to life time expected credit losses, low credit risk for these investments is a prerequisite upon acquisition and by using their credit risk as a basis for the distinction of categories.

Financial assets are written off when there is no realistic prospect of future recovery. (the issuer or the debtor is in financial difficulties or bankruptcy)

When the credit risk on debt instrument investment has increased, the Company will dispose that investment in order to minimize the credit losses. When assessing the expected credit losses, the evaluation of the forward-looking information (available without undue cost and effort) is mainly based on the macroeconomic information and the credit loss ratio is further adjusted if there is significant impact from forward-looking information.

(5) Liquidity risk management

The Company’s objective is to maintain a balance between continuity of funding and flexibility through the use of cash and cash equivalents, bank borrowings and finance leases. The table below summarizes the maturity profile of the Company’s financial liabilities based on the contractual undiscounted payments and contractual maturity.

Non-derivative financial liabilities

As of December 31, 2021 Accounts payables Lease liabilities Other payables As of December 31, 2020 Accounts payables Lease liabilities Other payables	Less than 1 year	2 to 3years	4 to 5years	> 5years	Total
	$600,357 15,505 691,173 $2,205,944 13,894 410,447	$- 8,813 - $- 7,958 -	$- 6,229 - $- 6,795 -	$- - - $- 2,831 -	$600,357 30,547 691,173 $2,205,944 31,478 410,447

67

• (6) Reconciliation of liabilities arising from financing activities

Reconciliation of liabilities for the year ended December 31, 2021:

As of January 1, 2021 Cash flows Non-cash change As of December 31, 2021	Lease liabilities	Total liabilities from financing activities
	$30,905 (15,722) 14,962	$30,905 (15,722) 14,962
	$30,145	$30,145

Reconciliation of liabilities for the year ended December 31, 2020:

As of January 1, 2020 Cash flows Non-cash change As of December 31, 2020	Lease liabilities	Total liabilities from financing activities
	$23,781 (14,379) 21,503	$23,781 (14,379) 21,503
	$30,905	$30,905

• (7) Fair values of financial instruments

• A. The methods and assumptions applied in determining the fair value of financial instruments:

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following methods and assumptions were used by the Company to measure or disclose the fair values of financial assets and financial liabilities:

• (a) The carrying amount of cash and cash equivalents, trade receivables, accounts payable and other current liabilities approximate their fair value due to their short maturities.

• (b) For financial assets and liabilities traded in an active market with standard terms and conditions, their fair value is determined based on market quotation price (including listed equity securities, beneficiary certificates, bonds and futures etc.) at the reporting date.

68

• B. Fair value of financial instruments measured at amortized cost

The carrying amount of the Company’s financial assets and liabilities measured at amortized cost approximate their fair value.

• (8) Significant assets and liabilities denominated in foreign currencies

Information regarding the significant assets and liabilities denominated in foreign currencies is listed below:

Financial assets	As of December 31,2021	As of December 31,2021	As of December 31,2021
	Foreign currencies (thousands)	Foreign exchange rate	NTD (thousands)
Monetary items: USD Financial liabilities
Monetary items: USD Financial assets
	Foreign currencies (thousands)	Foreign exchange rate	NTD (thousands)
	$124,213 77,955	28.4965 28.4965	$3,539,649 2,221,454
Monetary items: USD Financial liabilities
Monetary items: USD

Since there were various functional currencies used within the subsidiaries of the Company, the Company was unable to disclose foreign exchange gains or losses towards each foreign currency with significant impact. The realized and unrealized foreign exchange losses was $41,279 thousand and $48,913 thousand for the years ended December 31, 2021 and 2020, respectively.

69

• (9) Capital management

The primary objective of the Company’s capital management is to ensure that it maintains a strong credit rating and healthy capital ratios in order to support its business and maximize shareholder value. The Company manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To maintain or adjust the capital structure, the Company may adjust dividend payment to shareholders, return capital to shareholders or issue new shares.

1. Other disclosure

2. (1) Information at significant transactions

   • A. Financing provided to others: None.

   • B. Endorsement/Guarantee provided to others: Please refer to Attachment 1.

   • C. Securities held at the end of the period: None.

   • D. Individual securities acquired or disposed of with accumulated amount exceeding the lower of $300 million or 20 percent of the capital stock: None.

   • E. Acquisition of individual real estate with amount exceeding the lower of $300 million or 20 percent of the capital stock: None.

   • F. Disposal of individual real estate with amount exceeding the lower of $300 million or 20 percent of the capital stock: None.

   • G. Related party transactions for purchases and sales amounts exceeding the lower of $100 million or 20 percent of the capital stock: Please refer to Attachment 2.

   • H. Receivables from related parties with amounts exceeding the lower of $100 million or 20 percent of capital stock: Please refer to Attachment 3.

   • I. Financial instruments and derivative transactions: None.

   • J. Others: Business relationship between the parent and the subsidiaries and between each subsidiary, and the circumstances and accounts of any significant transactions between term: Please refer to Attachment 4.

70

(2) Information on investees

Of the investee company directly or indirectly has significant influence or control over, their investee companies’ information: Please refer to Attachment 5.

(3) Investment in Mainland China:

None.

• (4) Information of major shareholder:

Shares Name of major shareholder	Number of shares held (shares)	Shareholding ratio (%)
ASUS INVESTMENT CO.,LTD.	57,217,754	46.54%
ASUSTEK INVESTMENT CO.,LTD.	7,453,405	6.06%
HONGHUNG INVESTMENT LIMITED	6,526,897	5.30%

71

ATTACHMENT 1 Endorsement/Guarantee provided to others

(Expressed in Thousands of New Taiwan Dollars u	(Expressed in Thousands of New Taiwan Dollars u	nless Otherwise Specified) (Unit : thousands of NTD)	nless Otherwise Specified) (Unit : thousands of NTD)	nless Otherwise Specified) (Unit : thousands of NTD)	nless Otherwise Specified) (Unit : thousands of NTD)	nless Otherwise Specified) (Unit : thousands of NTD)	nless Otherwise Specified) (Unit : thousands of NTD)	nless Otherwise Specified) (Unit : thousands of NTD)	nless Otherwise Specified) (Unit : thousands of NTD)	nless Otherwise Specified) (Unit : thousands of NTD)	nless Otherwise Specified) (Unit : thousands of NTD)	nless Otherwise Specified) (Unit : thousands of NTD)	nless Otherwise Specified) (Unit : thousands of NTD)
No (Note1)	Endorsememts/Guaraniees Provider	Guaranteed Party		Limits on Endorsement/Guarantee Amount Provided to Each Guaranteed Party (Note3)	Maximum Balance for the Period	Ending Balance	Amnount Actually Drawn	Amounts of Endorsement/ Guarantee secured by Properties	Ratio of Accumulated Endorsement/ Guarantee to Net Worth per Latest Financial Statements	Maximum Endorsement/ Guarantee Amount Allowed(Note4)	Endorsement Provided by Parent Company to Subsidiaries	Endorsement Provided by Subsidiaries to parent company	Endorsement Provided to entities in China
		Name	Nature of Relationship (Note2)
0	ASROCK INC.	ASIAROCK TECHNOLOGY LIMITED	(2)	$5,789,798	$2,224,360	$2,214,640	$1,660,980	-	26.78%	$5,789,798	Y	N	N

Note 1 : The numbers filled in for the endorsements/guarantees provided by the group or subsidiaries are as follows:

(1) The Company is coded "0".

• (2) The subsidiaries are coded starting from "1"in the order.

Note 2 : The following code represents the relationship with the company:

• (1) A company with which it does business.

(2) A company in which the public company directly and indirectly holds more than 50 percent of the voting shares.

(3) A company that directly and indirectly holds more than 50 percent of the voting shares in the public company.

• (4) A company in which the public company holds, directly or indirectly, 90% or more of the voting shares.

(5) A company that fulfills its contractual obligations by providing mutual endorsements/guarantees for another company company in the same industry or for joint builders for purposes of undertaking a construction project.

• (6) A company that all capital contributing shareholders make endorsements/ guarantces for their jointly invested company in proportion to their shareholding percentages.

(7) Companies in the same industry provide among themselves joint and several security for a performance guarantee of a sales contract for pre-construction homes pursuant to the Consumer Protection Act for each other.

Note 3 : The amount of endorsements/guarantees for any single entity 100% holding company of shall not exceed 70% of net worth of endorsor/guarantor.

Note 4 : The amount of endorsements/guarantees collateralized by properties shall not exceed 70% of net worth of endorsor/guarantor.

Note 5 : If the original currency amount in the above is foreign currency, it is converted into New Taiwan Dollars in December 31, 2021 financial report exchange rate, and the spot exchange rate of December 31, 2021 is USD/NTD 27.6830.

72

(Unit : thousands of NTD)

ATTACHMENT 2 Related Party Transactions for Purchases and Sales amounts exceeding the lower of $100 million or 20 percent of the Capital Stock (Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

Purchases/Sales Company Name	Counter-Party	Relationship (Note4)	Transactions Details	Transactions Details	Transactions Details	Transactions Details	Details of Non-arm's Length Transactions(Note1)	Details of Non-arm's Length Transactions(Note1)	Notes and Accounts Receivable (Payable)	Notes and Accounts Receivable (Payable)	Remark (Note2)
			Purchases (Sales)	Amount	Percentage of Total Purchases(Sales)	Terms	Unit Price	Terms	Balance	Percentage of Total Receivable (Payable)
ASROCK INC. 〃 ASIAROCK TECHNOLOGT LIMITED 〃 〃 ASROCK RACK INCORPORATION 〃 ASRock Industrial Computer Corporation	ASRock Europe B.V. ASRock America, Inc ASROCK INC. ASROCK RACK INCORPORATION ASRock Industrial Computer Corporation ASRock Europe B.V. ASRock America, Inc ASRock Europe B.V.	1 1 2 3 3 3 3 3	(Sales) (Sales) (Sales) (Sales) (Sales) (Sales) (Sales) (Sales)	$(3,896,085) $(3,731,808) (10,345,855) (2,032,823) (337,206) (159,217) (352,551) (168,933)	(26.80%) (25.67%) (73.30%) (14.40%) (2.39%) (5.03%) (11.14%) (13.60%)	45 days 90 days 60 days 60 days 60 days 60 days 90 days 60 days	Same as other clients Same as other clients Same as other clients Same as other clients Same as other clients Same as other clients Same as other clients Same as other clients	Same as other clients Same as other clients Same as other clients Same as other clients Same as other clients Same as other clients Same as other clients Same as other clients	$59,480 767,816 543,189 102,159 99,914 28,321 121,325 9,435	3.48% 44.94% 61.29% 11.53% 11.27% 5.77% 24.73% 8.33%

Note 1: If the related party's transaction terms are different from the general transaction terms, the unit price and credit period column should state the difference and the reason. Note 2: If there is any receipt (payment) in advance, the reason, contractual terms, amount, and differences from the general transaction type should be stated in the remarks column.

Note 3: The paid-in capital shall refer to the paid-in capital of the parent company. If securities issuers issued no-par value stocks or stocks with par value that are not TWD10 per share, the criteria shall be 10% of the amount attributable to parent company's equity.

Note 4: The following lists the three types of intercompany transactions (any transaction between parent company and subsidiary or between subsidiaries is disclosed as one transaction by either transaction counterparty.)

(1) Transactions from parent company to subsidiary is "1".

(2) Transactions from subsidiary to parent company is "2".

(3) Transactions between subsidiaries is "3".

73

(Unit : thousands of NTD)

ATTACHMENT 3 Receivables from Related Parties with amounts exceeding the lowerof $100 million or 20 percent of Capital Stock

(Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

Company	Counter-party	Relationship (Note3)	Ending Balance(Note1)	Turnover	Overdue Receivables	Overdue Receivables	Amount Received in Subsequent Period	Allowance for Bad Debts
					Amount	Collection
ASROCK INC. ASIAROCK TECHNOLOGY LIMITED 〃 ASROCK RACK INCORPORATION	ASRock America, Inc. ASROCK INC. ASROCK RACK INCORPORATION ASRock America,Inc	1 2 3 3	$767,816 543,189 102,159 121,325	3.38 7.11 6.43 3.40	$- - - -	- - - -	$100,904 378,577 367 -	- - - -

Note 1: Please fill in separately according to accounts receivable, bills, other receivables... etc.

Note 2: The paid-in capital shall refer to the paid-in capital of the parent company. If securities issuers issued no-par value stocks or stocks with par value that are

not TWD10 per share, the criteria shall be 10% of the amount attributable to parent company's equity.

Note 3: The following lists the three types of intercompany transactions (any transaction between parent company and subsidiary or between subsidiaries is disclosed as one transaction by either transaction counterparty)

• (1) Transactions from parent company to subsidiary is "1".

• (2) Transactions from subsidiary to parent company is "2".

• (3) Transactions between subsidiaries is "3".

74

(Unit : thousands of NTD)

ATTACHMENT 4 Business Relationship between the Parent and the Subsidiaries and between each Subsidiary, and the circumstances and accounts of any significant transactions between term (Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

Company Counter-Party 0 ASROCK INC. ASRock Europe B.V. 1 〃 〃 ASRock America, Inc 1 1 ASIAROCK TECHNOLOGY ASROCK INC. 2 LIMITED 〃 〃 ASROCK RACK INCORPORATION 3 〃 〃 ASRock Industrial Computer 3 Corporation 2 ASROCK RACK INCORPORATION ASRock Europe B.V. 3 〃 〃 ASRock America, Inc 3 3 ASRock Industrial Computer ASRock Europe B.V. 3 Corporation Relationship (Note2) No. (Note1)

Account Amount (Note4) Terms Percentage of consolidated total operating revenues or total assets(Note3) Sales $3,896,085 Same as other clients 19.71% Accounts receivable 59,480 45 days 0.37% Sales 3,731,808 Same as other clients 18.88% Accounts receivable 767,816 90 days 4.83% Sales 10,345,855 Same as other clients 52.35% Accounts receivable 543,189 60 days 3.42% Sales 2,032,823 Same as other clients 10.29% Accounts receivable 102,159 60 days 0.64% Sales 337,206 Same as other clients 1.71% Accounts receivable 99,914 60 days 0.63% Sales 159,217 Same as other clients 0.81% Accounts receivable 28,321 60 days 0.18% Sales 325,551 Same as other clients 1.78% Accounts receivable 121,325 90 days 0.76% Sales 168,933 Same as other clients 0.85% Accounts receivable 9,435 60 days 0.06% Transaction Details

Note 1: The Company and its subsidiaries are coded as follows:

• 1.The Company is coded "0".

• 2.Subsidiaries are coded consecutively starting from "1" in the order presented in the table above.

• Note 2: The following lists the three types of intercompany transactions (any transaction between parent company and subsidiary or between subsidiaries is disclosed as one transaction by either transaction counterparty.)

• (1) Transactions from parent company to subsidiary is "1".

• (2) Transactions from subsidiary to parent company is "2".

• (3) Transactions between subsidiaries is "3".

• Note 3: The percentage is determined by the ratio of the transaction amount to the consolidated revenues or the total assets. Items on the balance sheet are calculated by the ending balance to total consolidated assets; items on the income statement are calculated by their midterm cumulative balance to the total consolidated income.

Note 4: The disclosure of significant intercompany transactions in this attachment is determined by the company based on the materiality.

75

ATTACHMENT 5 Information on Investees

(Unit : thousands of NTD / dollor of USD )

(Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

Investor company (Note 2(1))	Investee company (Note1,2(1))	Location (Note 2(1))	Main business item (Note 2(1))	Initial Investment (Note 2(1))	Initial Investment (Note 2(1))	Investment as of December 31, 2021 (Note 2(1))	Investment as of December 31, 2021 (Note 2(1))	Investment as of December 31, 2021 (Note 2(1))	Investee company	Net	Remark
				Ending balance	Beginning balance	Number of shares	Percentage of ownership	Book value	Net income(loss) of investee company(Note2(2))	Investment income (loss) recognized(Note2(3))
ASROCK INC. ASIAROCK TECHNOLOGY LIMITED 〃 LEADER INSIGHT HOLDINGS LTD. FIRSTPLACE INTERNATIONAL LTD. 〃 〃 〃 〃 〃 〃	ASROCK RACK INCORPORATION ASIAROCK TECHNOLOGY LIMITED LEADER INSIGHT HOLDINGS LTD. ASRock Industrial Computer Corporation ASJade Technology Inc. SOARING ASIA LIMITED Total ASRock Europe B.V. CALROCK HOLDINGS, LLC Orbweb Inc. (BVI) FIRSTPLACE INTERNATIONAL LTD. ASRock America, Inc.	Taiwan Taiwan Taiwan Hong Kong Netherlands USA British Virgin Islands British Virgin Islands British Virgin Islands USA British Virgin Islands	Manufacture and sale of computers and peripheral Investment holding Investment holding Manufacture and sale of computers and peripheral Service of computer software International trade Data storage and sales of electronic materials and international trade Rent office building Computer equipment installation and peripheral equipment wholesale and service Investment holding Data storage and sales of electronic materials and international trade	$291,278 1,320,886 71,559 239,683 103,125 HKD 150,000 USD 194,000 USD 2,000,000 USD 1,000,000 USD 2,050,000 USD 2,000,000	$291,278 1,320,886 71,559 239,683 - HKD 150,000 USD 194,000 USD 2,000,000 USD 1,000,000 USD 2,050,000 USD 2,000,000	27,296,220 (Note4) 40,000,000 2,100,000 23,895,700 8,250,000 150,000 200,000 2,000,000 4,000,000 2,050,000 2,000,000	59.67% (Note4) 100.00% 100.00% 65.83% (Note5) 78.57% 100.00% 100.00% 100.00% 27.59% 100.00% 100.00%	$418,174 3,599,438 (Note3) 102,306 399,697 101,294 533 USD 24,109,980 USD 2,153,327 - USD 3,694,081 USD 3,660,536	$66,691 107,324 68,350 156,396 (2,331) - USD 3,858,554 (USD 40,439) (USD 95,788) USD 2,441,303 USD 2,441,292	$40,001 118,768 68,350 103,708 (1,831) -
										$328,996
										USD 3,858,554 (USD 40,439) - USD 2,441,303 USD 2,441,292

Note 1:If a public offering company has a foreign holding company and uses consolidation as the main financial statement in accordance with local laws and regulations,the disclosure of information about the foreign invested company may only disclose relevant information to the holding company.

Note 2:If it is not in the case described in Note 1, fill in according to the following regulations:

(1)The “name of the investee company”, “location”, “main business item”, “original investment amount” and “end-of-term shareholding situation” should be based on the company’s reinvestment status and fill in the reinvestment situation of each investedcompany directly or indirectly controlled in order, and indicate the relationship between each invested company and the (public offering) company (if it is a subsidiary or a grandson company) in the remarks column. (2)In column B of "Invested Company Current Profit and Loss", the amount of current profit and loss of each invested company should be filled in.

(3)In column B of "Investment Profits and Losses Recognized in the Current Period", only the amount of profit and loss of the subsidiaries recognized by the (public offering) company for direct reinvestment and each invested company evaluated by the equity method is required. When filling in the “recognition of the current profit and loss amount of each subsidiary for direct reinvestment”, it should be confirmed that the current profit and loss amount of each subsidiary has included the investment profit and loss that should be recognized for iits reinvestment in accordance with the regulations.

Note 3:Book value = net equity $3,708,273 thousand + deferred credit $(108,835) thousand.

Note 4:The employee stock option was offered by ASROCK RACK INCORPORATION on July 14, 2021. Because the Company did not subscribe the shares according to the shareholding ratio, the ownership interest in the company was reduced from 62.05% to 59.67%.

In addition, stock dividends were issued on August 24, 2021, which was resolved by the board of directors' meeting on August 18, 2021. The shares of the Company increased from 19,479,035 to 27,296,220.

Note 5:The employee stock option was offered by ASRock Industrial Computer Corporation on June 11, 2021. Because the Company did not subscribe the shares according to the shareholding ratio, the ownership interest in the company was reduced from 66.96% to 65.83%.

76

THE CONTENTS OF STATEMENTS OF MAJOR ACCOUNTING ITEMS

For the year ended December 31, 2021

Major Accounting Items in Assets, Liabilities and Equity Statement of Cash and Cash Equivalents Statement of Financial Assets Measured at Amortized Cost-Current Statetment of Accounts Receivable, net Statetment of Inventories, net Statement of Prepayments Statement of Other Current Assets Statement of Changes in Investments Accounted for Using Equity Method Statement of Changes in Property, Plant and Equipment Statement of Changes in Accumulated Depreciation of Property, Plant and Equipment Statement of Changes in Right-of-Use Assets Statement of Changes in Accumulated Depreciation of Right-of-Use Assets Statement of Changes in Intangible Assets Statement of Deferred Tax Assets and Liabilities Statement of Other Non-Current Assets Statement of Accounts Payable Statement of Other Payables Statement of Lease Liabilities Statement of Other Current Liabilities Statement of Other Non-Current Liabilities Major Accounting Items in Profit or Loss Statement of Operating Revenues Statement of Operating Costs Statement of Sales and Marketing Expenses Statement of General and Administrative Expenses Statement of Research and Development Expenses Expected credit losses Statement of Financial Cost Statement of Employee Benefits, Depreciation and Amortization Expenses by Function Item

Index

78 79 80 81 82 83 84 Note6(6) 85 86 Note6(7) Note6(17) 87 88 89 90 91 92 93 94 95 96 97 Note6(12) Note6(15) Note6(14) Note6(6)

77

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

1. �Statement of Cash and Cash Equivalents

As of December 31, 2021

(In Thousands of New Taiwan Dollars)

(In dollars of Foreign Currency)

Item	Description	Amount	Note
Cash on hand Cash in banks Current deposits Foreign currency current deposit Check deposit Total Time deposits Taipeifubon Commercial Bank USD 1,000,000 Mega Bank USD 3,000,000 Subtotal Total	Petty cash USD 15,927,014 CNY 161,148 (110.12.22-111.01.06，Rate 0.20%，Fixed Rate) (110.12.30-111.01.13，Rate 0.14%，Fixed rate)	$480 477,967 440,907 700 514 920,088 27,683 83,049 110,732 $1,031,300	Exchange rate：27.6830 Exchange rate：4.3420 Exchange rate：27.6830

78

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

1. Statement of Financial Assets Measured at Amortized Cost-Current

As of December 31, 2021

(In Thousands of New Taiwan Dollars)

(In dollars of Foreign Currency)

Item	Description	Quantity	Par Value	Amount	Interest Rate	Accumulated Impairment Loss	Note
Time deposit–Current Land Bank of Taiwan Total	110.07.15-111.07.14 110.07.29-111.07.14 110.08.05-111.07.14 110.08.19-111.07.14 110.08.26-111.07.14 110.09.02-111.07.14 110.09.23-111.07.14 110.09.30-111.07.14 110.04.08-111.04.14 110.04.15-111.04.21 110.04.22-111.04.28 110.04.29-111.05.05 110.05.20-111.07.14 110.05.27-111.07.14 110.06.03-111.07.14 110.06.10-111.07.14 110.06.17-111.07.14 110.06.24-111.07.14 110.07.01-111.07.14 110.07.08-111.07.14	20 12 28 24 36 8 8 8 12 12 16 16 16 16 16 16 16 28 16 20	$2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500	$50,000 30,000 70,000 60,000 90,000 20,000 20,000 20,000 30,000 30,000 40,000 40,000 40,000 40,000 40,000 40,000 40,000 70,000 40,000 50,000	Rate 0.700%，Floating rate Rate 0.700%，Floating rate Rate 0.700%，Floating rate Rate 0.700%，Floating rate Rate 0.700%，Floating rate Rate 0.700%，Floating rate Rate 0.700%，Floating rate Rate 0.700%，Floating rate Rate 0.815%，Floating rate Rate 0.815%，Floating rate Rate 0.815%，Floating rate Rate 0.815%，Floating rate Rate 0.815%，Floating rate Rate 0.815%，Floating rate Rate 0.815%，Floating rate Rate 0.815%，Floating rate Rate 0.815%，Floating rate Rate 0.815%，Floating rate Rate 0.815%，Floating rate Rate 0.815%，Floating rate	$- - - - - - - - - - - - - - - - - - - -
				$860,000

79

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

3. Statetment of Accounts Receivable, net

As of December 31, 2021

(In Thousands of New Taiwan Dollars)

Client Name	Description	Amount	Note
Non-related parties Client A Client B Client C Others Subtotal Less: loss allowance Net Related parties ASRock America Inc. ASRock Europe B.V. ASIAROCK TECHNOLOGY LIMITED ASROCK RACK INCORPORATION ASRock Industrial Computer Corporation Subtotal Less: loss allowance Net Total	Payments for Sellings Goods 〃 〃 The amount of individual client included in others does not exceed 5% of the account Payments for Sellings Goods 〃 〃 〃 〃	$162,975 120,161 53,826 492,353 829,315 (8,689) 820,626 767,816 59,480 47,497 4,133 207 879,133 - 879,133 $1,699,759

80

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

4. Statement of Inventories, net

As of December 31, 2021

(In Thousands of New Taiwan Dollars)

Item	Description	Amount	Amount	Note
		Cost	Net Realizable Value
Merchandise Work in progress Raw materials Finished goods Subtotal Less: allowance for inventory obsolescence valuation losses Net	Replace of components after-sales service	$888,944 410,203 158,255 5,501 1,462,903 (75,040) $1,387,863	$1,132,792 411,656 324,317 5,501	1. Inventories were not pledged. 2. Inventories are valued at lower of cost or net realizable value item by item.
			$1,874,266

81

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

1. Statement of Prepayments

As of December 31, 2021

(In Thousands of New Taiwan Dollars)

Item	Description	Amount	Note
Overpaid sales tax Other prepaid expense Supplies inventory Prepayments to suppliers Total	Prepaid insurance etc. Prepaid for purchase of materials etc.	$95,085 8,903 1,642 734,291 $839,921

82

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

6. Statement of Other Current Assets

As of December 31, 2021

(In Thousands of New Taiwan Dollars)

Item	Description	Amount	Note
Other receivables Temporary payments Payment on behalf of others Total	Interest income and other income in receivable Prepaid for association fee and meal expense etc. Prepaid for rents, expense for administration and utilities etc.	$39,976 12,322 1,355 $53,653

83

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

1. Statement of Changes in Investments Accounted for Using Equity Method

For the Year Ended December 31, 2021

(In Thousands of New Taiwan Dollars)

==> picture [699 x 310] intentionally omitted <==

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

As of January 1, 2021 Additions Decrease As of December 31, 2021 Fair Value/Net assets value
Investee companies Collateral Note
Shares Amount Shares Amount Shares Amount Shares % Amount Unit price $ Total amount
Investments Accounted for Using Equity Method
ASROCK RACK INCORPORATION 19,479,035 $387,739 7,817,185 $45,251 - $(14,816) 27,296,220 59.67% $418,174 $15.32 $418,174 None
(Note 1) (Note 2)
ASIAROCK TECHNOLOGY LIMITED 40,000,000 3,563,486 - 143,246 - (107,294) 40,000,000 100.00% 3,599,438 89.99 3,599,438 None
(Note 3) (Note 4)
LEADER INSIGHT HOLDINGS LIMITED 2,100,000 35,743 - 68,350 - (1,787) 2,100,000 100.00% 102,306 48.72 102,306 None
(Note 5) (Note 6)
ASRock Industrial Computer Corporation 23,875,700 344,649 - 103,708 - (48,660) 23,875,700 65.83% 399,697 16.74 399,697 None
(Note 7) (Note 8)
ASJade Technology Inc. - - 8,250,000 103,125 - (1,831) 8,250,000 78.57% 101,294 12.28 101,294 None
(Note 9) (Note 10)
SOARING ASIA LIMITED 150,000 552 - - - (19) 150,000 100.00% 533 35.53 533 None
(Note 11)
Total $4,332,169 $463,680 $(174,407) $4,621,442
----- End of picture text -----

Note 1: Recognize in investment gain according to the equity method by $40,001. Recognize in capital surplus according to the equity method by $5,250 .

Note 2: Recognize the distribution of cash dividends by $14,816.

Note 3: Recognize in investment gains according to the equity method by $118,767 and unrealized intercompany profit is $24,479.

Note 4: The c umulative translation adjustment is $107,294.

Note 5: Recognize in investment gains according to the equity method by $68,350.

Note 6: The cumulative translation adjustment is $1,787.

Note 7: Recognize in investment gain according to the equity method by $103,708.

Note 8: Recognize the distribution of cash dividends by $46,984. Recognize in capital surplus according to the equity method by $1,676.

Note 9: Recognize in investment of subsidiaries by $103,125.

Note 10: Recognize in investment loss according to the equity method by $1,831.

Note 11: The cumulative translation adjustment is $19.

84

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

8. Statement of Changes in Right-of-Use Assets

For the Year Ended December 31, 2021

(In Thousands of New Taiwan Dollars)

Item	As of January 1, 2021	Additions	Decrease	As of December 31, 2021	Note
Item A Item B Item C Item D Item E Total	$9,027 22,314 4,056 21,191 - $56,588	$- - - - 15,133 $15,133	$- - 399 - - $399	$9,027 22,314 3,657 21,191 15,133 $71,322

85

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

9. Statement of Changes in Accumulated Depreciation of Right-of-Use Assets

For the Year Ended December 31, 2021

(In Thousands of New Taiwan Dollars)

Item	As of January 1, 2021	Additions	Decrease	As of December 31, 2021	Note
Item A Item B Item C Item D Item E Total	$9,027 13,017 1,947 1,926 - $25,917	$- 9,298 903 3,302 1,892 $15,395	$- - - - - $-	$9,027 22,315 2,850 5,228 1,892 $41,312	The increase in the current period is all deprecration expense and the straight - line method is used.

86

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

10. Statement of Other Non-Current Assets

As of December 31, 2021

(In Thousands of New Taiwan Dollars)	(In Thousands of New Taiwan Dollars)	(In Thousands of New Taiwan Dollars)	(In Thousands of New Taiwan Dollars)
Item	Description	Amount	Note
Guarantee deposits paid Item A Item B Item C Item D Item E Others Total	Rents deposit for vehicle Rents deposit for office Rents deposit for vehicle Rents deposit for vehicle Rents deposit for vehicle The amount of individual item does not exceed 5% of the account balance.	$5,220 4,701 1,380 880 860 956 $13,997

87

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

1. Statement of Accounts Payable

As of December 31, 2021

(In Thousands of New Taiwan Dollars)

Vendor Name	Description	Amount	Note
Non-related parties Vendor A Vendor B Vendor C Vendor D Vendor E Others Subtotal Related parties ASIAROCK TECHNOLOGY LIMITED ASROCK RACK INCORPORATION Others Subtotal Total	Payments for buying goods 〃 〃 〃 〃 The amount of individual vendor does not exceed 5% of the account balance. Payments for buying goods 〃 The amount of individual vendor does not exceed 5% of the account balance.	$30,141 11,336 5,594 5,431 5,233 14,652 72,387 490,723 35,109 2,138 527,970 $600,357

88

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

1. Statement of Other Payables

As of December 31, 2021

(In Thousands of New Taiwan Dollars)

Item	Description	Amount	Note
Accrued payroll Accrued employees' compensation and compensation payable to directors Freight payable Others Total	The amount of individual item does not exceed 5% of the account balance.	$269,848 261,749 55,034 104,542 $691,173

89

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

13. Statement of Lease Liabilities

As of December 31, 2021

(In Thousands of New Taiwan Dollars)

Item	Description	Period	Discount rate	As of December 31, 2021	Note
Lease Liabilities-Current Item C Item D Item E Subtotal Lease Liabilities-Non-current Item C Item D Item E Subtotal Total	Buildings Buildings Buildings Buildings Buildings Buildings	107.05.01-112.02.28 109.06.01-115.10.31 110.11.01-112.02.28 107.05.01-112.02.28 109.06.01-115.10.31 110.11.01-112.02.28	1.20% 0.90% 0.69% 1.20% 0.90% 0.69%	$703 3,269 11,350 15,322 118 12,806 1,899 14,823 $30,145

90

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

14. Statement of Other Current Liabilities

As of December 31, 2021

(In Thousands of New Taiwan Dollars)

Item	Description	Amount	Note
Contract liabilities Refund liability Others Total	The amount of individual item does not exceed 5% of the account balance.	$347,268 181,791 2,428 $531,487

91

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

15. Statement of Other Non-Current Liabilities

As of December 31, 2021

(In Thousands of New Taiwan Dollars)

Item	Description	Amount	Note
Net defined benefit liabilities Total	According to IAS19 provision for net defined benefit liability	$42,028 $42,028

92

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

1. Statement of Operating Revenues

For the Year Ended December 31, 2021

(In Thousands of New Taiwan Dollars)

Item	Quantity(PCS)	Domestic Sales	Export sales	Total	Note
Merchandise of computer peripheral Other Total operating revenues	4,872,273 7,098,949	$28,681 113,092 $141,773	$14,214,321 179,159 $14,393,480	$14,243,002 292,251 $14,535,253

93

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

17. Statement of Operating Costs

For the Year Ended December 31, 2021

(In Thousands of New Taiwan Dollars)

Item		Amount	Note
Raw materials, beginning of year Add: Raw materials purchased Less: Ending balance Transferred to sales Others Raw materials used Add: Merchandise, beginning of year Merchandise purchased Raw materials transferred to sales Other Less: Merchandise, ending of year Inventories transferred to expense Other Cost of merchandise sold Add: Others Add: Loss from inventory obsolescence valuation loss Total		$18,345 1,342,340 (158,255) (1,201,933) (497) - 1,389,892 9,452,433 1,201,932 505 (1,304,648) (20,439) (109) 10,719,566 66,937 34,173 $10,820,676

94

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

18. Statement of Sales and marketing Expenses

For the Year Ended December 31, 2021

(In Thousands of New Taiwan Dollars)

			(In Thousands of New Taiwan Dollars)
Item	Description	Amount	Note
Salaries Advertisement Shipping Others Total		$163,087 96,940 45,972 64,006 $370,005	The amount of individual item included in others does not exceed 5% of the sales and marketing expenses.

95

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

19. Statement of General and Administrative Expenses

For the Year Ended December 31, 2021

(In Thousands of New Taiwan Dollars)

Item	Description		Amount	Note
Salaries Board Compensation Others Total			$171,431 23,795 48,711 $243,937	The amount of individual item included in others does not exceed 5% of the general and administrative expenses.

96

English Translation of Parent Company Only Financial Statements Originally Issued in Chinese

ASROCK INC.

1. Statement of Research and Development Expenses

For the Year Ended December 31, 2021

(In Thousands of New Taiwan Dollars)

			(In Thousands of New Taiwan Dollars)
Item	Description	Amount	Note
Salaries Material Consumption Others Total		$514,072 37,595 112,159 $663,826	The amount of individual item included in others does not exceed 5% of the research and development expenses.

97