CHC — Audit Report / Information 2019

Nov 11, 2019

CHC HEALTHCARE GROUP AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND

AUDIT REPORT OF INDEPENDENT

ACCOUNTANTS

DECEMBER 31, 2019 AND 2018

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

REPRESENTATION LETTER

The entities that are required to be included in the combined financial statements of CHC Healthcare Group as of and for the year ended December 31, 2019, under the Criteria Governing the Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises are the same as those included in the consolidated financial statements prepared in conformity with the International Financial Reporting Standard 10, “Consolidated Financial Statements.” In addition, the information required to be disclosed in the combined financial statements is included in the consolidated financial statements. Consequently, CHC Healthcare Group and Subsidiaries do not prepare a separate set of combined financial statements.

Very truly yours,

CHC HEALTHCARE GROUP

By

Pei-Lin Lee Chairman

March 23, 2020

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REPORT OF INDEPENDENT ACCOUNTANTS TRANSLATED FROM CHINESE

To the Board of Directors and Shareholders of CHC Healthcare Group

Opinion

We have audited the accompanying consolidated balance sheets of CHC Healthcare Group and subsidiaries (the “Group”) as at December 31, 2019 and 2018, and the related consolidated statements of comprehensive income, of changes in equity and of cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2019 and 2018, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission.

Basis for opinion

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

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole and, in forming our ~2~

opinion thereon, we do not provide a separate opinion on these matters.

Key audit matters on the consolidated financial statements for the year ended December 31, 2019 were as follows:

Impairment assessment of goodwill

Description

As of December 31, 2019, the Group generated goodwill of NT$150,617 thousand as a result of the merger with Shih-Lu Co., Ltd.

After identifying the smallest cash generating unit which can generate independent cash flows, the Group used the recoverable amount of each cash generating unit to assess whether goodwill may be impaired. Since the assumptions used by management to assess whether goodwill is impaired involve subjective judgement and have high uncertainty, we consider the impairment assessment of goodwill a key audit matter.

Refer to Note 4(21) for the accounting policy on goodwill impairment, Note 5(2) for uncertainty of accounting estimates and assumptions in relation to goodwill impairment and Note 6(31) for related details.

How our audit addressed the matter

We performed the following audit procedures on the above key audit matter:

• A. Obtained an understanding on how management identifies the objective evidence of goodwill impairment, taking into account certain factors in a consistent manner and ascertained whether the management uses reliable information.

• B. Obtained the report on the valuation of the subsidiary issued by an expert appointed by the management and performed the following:

• (1) Assessed the expert’s independence, objectiveness and competence by reviewing the expert’s qualification.

• (2) Assessed whether the valuation model is reasonable based on our knowledge of the Group’s businesses and industry.

• (3) Confirmed whether the expert uses the same future cash flows relative to the budget for the

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next five years provided by the management.

• (4) Checked whether the comparable assets adopted in appraisal report are consistent with the actual operations.

• (5) Assessed whether the significant assumptions applied by the expert are relevant and reasonable and tested the mathematical accuracy.

Impairment assessment of property, plant and equipment

Description

Some of the Group’s leasing businesses were not as profitable as expected due to fierce competition in the healthcare industry. The Group assesses the impairment based on the estimated recoverable amounts of leasing assets (shown as property, plant and equipment) where there is an indication that they are impaired. Given that the calculation of recoverable amounts requires significant accounting estimates relying on subjective judgement and uncertainty, we consider the impairment assessment of leasehold assets using the cash-generating units as a key audit matter.

Refer to Note 4(21) for the accounting policy on asset impairment and Note 5(2) for accounting estimates and assumption uncertainty of asset impairment.

How our audit addressed the matter

We performed the following audit procedures on the above key audit matter:

• A. Obtained an understanding on how management identifies the objective evidence of impairment, taking into account certain factors in a consistent manner and ascertained whether the management uses reliable information.

• B. Acquired the asset appraisal report issued by an expert appointed by the management and performed the following:

• (1) Assessed the independence, objectiveness and competence by reviewing the expert’s qualification.

• (2) Assessed whether the valuation method is widely adopted and appropriate based on our knowledge of the Group’s businesses and industry.

• (3) Confirmed whether the replacement cost, comparative objects and the assets’ use indicated on the appraisal report are consistent with the actual operations.

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• (4) Assessed whether the significant assumptions applied by the expert are relevant and reasonable and tested the mathematical accuracy.

Other matter – Parent company only financial reports

We have audited and expressed an unqualified opinion on the parent company only financial statements of CHC Healthcare Group as at and for the years ended December 31, 2019 and 2018.

Responsibilities of management and those charged with governance for the consolidated financial statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

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

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

Auditor’s responsibilities for the audit of the consolidated financial statements

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

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As part of an audit in accordance with ROC GAAS, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

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

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

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

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

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

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

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.

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our 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.

For and on behalf of PricewaterhouseCoopers, Taiwan March 23, 2020

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

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

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CHC HEALTHCARE GROUP AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2019 AND 2018

(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

Assets	Notes 6(1) 6(2)(25) 6(4)(24) 6(23) and 7 6(5) and 8 6(5) (11) 6(11) and 7 7 6(6)(9) 6(7)(9) 8 6(2)(25) 6(3) 6(23) 6(8)(25) 6(9), 7 and 8 6(10) 6(9)(12) and 8 6(31) 6(28) 6(5)(11) 6(11) and 7 6(13) and 8 6(14)	December 31, 2019 Amount % $ 1,245,235 11 71,369 1 298,003 3 46,464 - 56,562 - 507,614 5 243,858 2 1,148 - 178,869 2 2,493 - 439,674 4 363,010 3 55,229 - 3,509,528 31 - - 38,681 - 34,438 - 8,963 - 4,691,417 42 29,828 - 1,210,388 11 159,151 1 84,751 1 174,040 2 49,364 1 525,026 5 689,750 6 7,695,797 69 $ 11,205,325 100	December 31, 2018 Amount % $ 1,209,636 11 53,482 1 - - 40,959 - 44,838 1 501,782 5 240,038 2 205 - 153,369 1 3,671 - 489,977 5 459,705 4 6,923 - 3,204,585 30 492 - 47,231 - - - 18,484 - 4,752,936 44 - - 1,194,580 11 161,746 1 68,298 1 117,678 1 68,822 1 533,968 5 678,915 6 7,643,150 70 $ 10,847,735 100
		Amount $ 1,245,235 71,369 298,003 46,464 56,562 507,614 243,858 1,148 178,869 2,493 439,674 363,010 55,229 3,509,528 - 38,681 34,438 8,963 4,691,417 29,828 1,210,388 159,151 84,751 174,040 49,364 525,026 689,750 7,695,797 $ 11,205,325	Amount $ 1,209,636 53,482 - 40,959 44,838 501,782 240,038 205 153,369 3,671 489,977 459,705 6,923 3,204,585 492 47,231 - 18,484 4,752,936 - 1,194,580 161,746 68,298 117,678 68,822 533,968 678,915 7,643,150 $ 10,847,735
Current assets 1100 Cash and cash equivalents 1110 Financial assets at fair value through profit or loss - current 1136 Current financial assets at amortised cost 1140 Contract assets - current 1150 Notes receivable, net 1170 Accounts receivable, net 1180 Accounts receivable - related parties 1200 Other receivables 1210 Other receivables due from related parties 1220 Current tax assets 130X Inventories 1410 Prepayments 1470 Other current assets 11XX Total current assets Non-current assets 1510 Financial assets at fair value through profit or loss - non-current 1517 Financial assets at fair value through other comprehensive income - non- current 1560 Non-current contract assets 1550 Investments accounted for using equity method 1600 Property, plant and equipment 1755 Right-of-use assets 1760 Investment property, net 1780 Intangible assets 1840 Deferred tax assets 1930 Long-term notes and accounts receivable 1940 Long-term notes and accounts receivable - related parties 1980 Other financial assets - non-current 1990 Other non-current assets 15XX Total non-current assets 1XXX Total assets

(Continued)

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CHC HEALTHCARE GROUP AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2019 AND 2018

(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

Liabilities and equity

December 31,2019 December 31,2018 Notes Amount % Amount % 6(15) and 8 $ 471,591 4 $ 686,932 6 6(23) 78,966 1 30,047 - 3,495 - 4,346 - 219,813 2 204,951 2 7 136 - 4,562 - 6(9) 168,774 1 149,934 2 7 - - - 67,742 1 64,063 1 18,798 - 10,685 - 7,425 - - - 6(16)(17),7 and 8 2,012,344 18 197,512 2 3,049,091 27 1,353,032 13 6(23) 660,942 6 309,500 3 6(16) and 8 - - 1,177,035 11 6(17) and 8 2,090,662 19 2,812,608 26 400 - 400 - 6(28) 40,161 1 40,431 - 22,809 - - - 23,921 - 21,210 - 2,838,895 26 4,361,184 40 5,887,986 53 5,714,216 53 6(16)(20) 1,416,335 13 1,399,136 13 6(16)(19)(21) 2,981,939 26 2,930,253 27 6(22) 277,548 2 245,206 2 363,621 3 33,211 - 545,509 5 763,134 7 6(3) ( 387,852 ) ( 3) ( 363,621) ( 3 ) 6(20) ( 34,956 ) - ( 34,956) - 5,162,144 46 4,972,363 46 155,195 1 161,156 1 5,317,339 47 5,133,519 47 9 $ 11,205,325 100 $ 10,847,735 100

Current liabilities 2100 Short-term borrowings 2130 Contract liabilities - current 2150 Notes payable 2170 Accounts payable 2180 Accounts payable - related parties 2200 Other payables 2220 Other payable - related parties 2230 Current tax liabilities 2250 Provisions for liabilities - current 2280 Current lease liabilities 2300 Other current liabilities 21XX Total current liabilities Non-current liabilities 2527 Contract liabilities - non-current 2530 Bonds payable 2540 Long-term borrowings 2550 Provisions for liabilities - non-current 2570 Deferred tax liabilities 2580 Non-current lease liabilities 2600 Other non-current liabilities 25XX Total non-current liabilities 2XXX Total liabilities Equity attributable to owners of the parent Share capital 3110 Share capital - common stock Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3320 Special reserve 3350 Unappropriated retained earnings Other equity 3400 Other equity 3500 Treasury shares 31XX Total equity attributable to owners of the parent 36XX Non-controlling interest 3XXX Total equity Significant contingent liabilities and unrecognised contract commitments 3X2X Total liabilities and equity

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

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CHC HEALTHCARE GROUP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS, EXCEPT FOR EARNINGS PER SHARE AMOUNTS)

Items

2019 2018 Notes Amount % Amount % 6(5)(11)(12)(23)(30) and 7 $ 2,950,052 100 $ 2,507,466 100 6(6)(10)(12)(18)(19) (27)(30) and 7 ( 2,144,050 ) ( 73) ( 1,776,680) ( 71) 806,002 27 730,786 29 6(10)(18)(19)(27) (30) ( 124,041 ) ( 4) ( 124,613) ( 5) ( 166,584 ) ( 6) ( 192,217) ( 7) ( 4,874 ) - ( 1,193) - 19,068 1 47,218 2 ( 276,431 ) ( 9) ( 270,805) ( 10) 529,571 18 459,981 19 6(4)(11)(24) and 7 32,232 1 15,621 - 6(2)(8)(9)(25)(31) and 7 ( 5,233 ) - ( 20,840) ( 1) 6(26) ( 78,344 ) ( 3) ( 82,066) ( 3) 6(8) ( 1,633 ) - ( 4,527) - ( 52,978 ) ( 2) ( 91,812) ( 4) 476,593 16 368,169 15 6(28) ( 86,162 ) ( 3) ( 50,340) ( 2) $ 390,431 13 $ 317,829 13 6(3) ($ 8,550 ) - ( $ 42,606) ( 2 ) ( 15,713 ) ( 1) ( 8,676) - 40 - 347 - 6(28) ( 8 ) - ( 2,150) - ($ 24,231 ) ( 1) ( $ 53,085) ( 2 ) $ 366,200 12 $ 264,744 11 $ 395,172 13 $ 323,422 13 ($ 4,741 ) - ( $ 5,593) - $ 370,941 12 $ 270,337 11 ($ 4,741 ) - ( $ 5,593) - 6(29) $ 2.83 $ 2.32 6(29) $ 2.46 $ 2.02

4000 Operating revenue 5000 Operating costs 5950 Gross profit Operating expenses 6100 Selling expenses 6200 General and administrative expenses 6300 Research and development expenses 6450 Gain on expected credit impairment loss 6000 Total operating expenses 6900 Operating profit Non-operating income and expenses 7010 Other income 7020 Other gains and losses 7050 Finance costs 7060 Share of loss of associates and joint ventures accounted for using equity method 7000 Total non-operating income and expenses 7900 Profit before income tax 7950 Income tax expense 8200 Profit for the year Other comprehensive income Components of other comprehensive income that will not be reclassified to profit or loss 8316 Unrealised gains (losses) from investments in equity instruments measured at fair value through other comprehensive income Components of other comprehensive income that will be reclassified to profit or loss 8361 Financial statements translation differences of foreign operations 8370 Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will be reclassified to profit or loss 8399 Income tax related to components of other comprehensive income that will be reclassified to profit or loss 8300 Other comprehensive loss for the year 8500 Total comprehensive income for the year Profit attributable to: 8610 Owners of the parent 8620 Non-controlling interest Comprehensive income attributable to: 8710 Owners of the parent 8720 Non-controlling interest Earnings per share 9750 Basic earnings per share 9850 Diluted earnings per share

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

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CHC HEALTHCARE GROUP AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

2018 Balance at January 1, 2018 Effects of retrospective application and restatement Balance at January 1 after adjustments Consolidated net income Other comprehensive income (loss) Total comprehensive income (loss) Appropriations of 2017 earnings Cash dividends Reversal of special reserve Compensation cost of employee stock options Compensation cost of employee stock options of subsidiaries Expired employee stock options Purchase of treasury shares Non-controlling interest Balance at December 31, 2018 2019 Balance at January 1, 2019 Consolidated net income Other comprehensive income (loss) Total comprehensive income (loss) Appropriations of 2018 earnings Legal reserve Special reserve Cash dividends Conversion of convertible bonds Exercise of employee stock options Compensation cost of employee stock options Compensation cost of employee stock options of subsidiaries Expired employee stock options Non-controlling interest Balance at December 31, 2019	Notes							Equityattribut	able to owners of theparent	able to owners of theparent								Non-controlling interest	Total equity
		Ordinaryshare $ 1,399,136 - 1,399,136 - - - - - - - - - - $ 1,399,136 $ 1,399,136 - - - - - - 7,809 9,390 - - - - $ 1,416,335			Capital Re	serves	Others	Re	tainedEarnings Special reserve Unappropriated retained earnings			Ot	her EquityInteres	t Unrealised gains (loss) on available-for- sale financial assets ($ 14,453) 14,453 - - - - - - - - - - - $ - $ - - - - - - - - - - - - - $ -	Treasury shares	Total
			Sharepremium		Treasury share transactions $ 173 - 173 - - - - - - - - - - $ 173 $ 173 - - - - - - - - - - - - $ 173	Employee share options		Legal reserve	Special reserve		Financial statements translation differences of foreign operations		Unrealised gains (loss) on financial assets at fair value through other comprehensive income
	6(3) 6(22) 6(19) 6(19) 6(20) 6(3) 6(22) 6(16)(20) 6(20) 6(19) 6(19)		$ 2,830,390 - 2,830,390 - - - - - - - - - - $ 2,830,390 $ 2,830,390 - - - - - - 22,883 71,363 - - - - $ 2,924,636			$ 56,776 - 56,776 - - - - - 1,207 2,030 ( 7,372) - - $ 52,641 $ 52,641 - - - - - - - ( 47,507) 2,134 3,592 ( 1,897) - $ 8,963	$ 39,677 - 39,677 - - - - - - - 7,372 - - $ 47,049 $ 47,049 - - - - - - ( 779) - - - 1,897 - $ 48,167	$ 245,206 - 245,206 - - - - - - - - - - $ 245,206 $ 245,206 - - - 32,342 - - - - - - - - $ 277,548	$ 171,995 - 171,995 - - - - ( 138,784 ) - - - - - $ 33,211 $ 33,211 - - - - 330,410 - - - - - - - $ 363,621	$ 203,226 251,607 454,833 323,422 - 323,422 ( 153,905) 138,784 - - - - - $ 763,134 $ 763,134 395,172 - 395,172 ( 32,342) ( 330,410) ( 250,045) - - - - - - $ 545,509	($ 18,758) - ( 18,758) - ( 10,479) ( 10,479) - - - - - - - ($ 29,237) ($ 29,237) - ( 15,681) ( 15,681) - - - - - - - - - ($ 44,918)		$ - ( 291,778) ( 291,778) - ( 42,606) ( 42,606) - - - - - - - ($ 334,384) ($ 334,384) - ( 8,550) ( 8,550) - - - - - - - - - ($ 342,934)		$ - - - - - - - - - - - ( 34,956 ) - ($ 34,956 ) ($ 34,956 ) - - - - - - - - - - - - ($ 34,956 )	$ 4,913,368 ( 25,718) 4,887,650 323,422 ( 53,085) 270,337 ( 153,905) - 1,207 2,030 - ( 34,956) - $ 4,972,363 $ 4,972,363 395,172 ( 24,231) 370,941 - - ( 250,045) 29,913 33,246 2,134 3,592 - - $ 5,162,144		$ 1,069 - 1,069 ( 5,593) - ( 5,593) - - - - - - 165,680 $ 161,156 $ 161,156 ( 4,741) - ( 4,741) - - - - - - - - ( 1,220) $ 155,195	$ 4,914,437 ( 25,718 ) 4,888,719 317,829 ( 53,085 ) 264,744 ( 153,905 ) - 1,207 2,030 - ( 34,956 ) 165,680 $ 5,133,519 $ 5,133,519 390,431 ( 24,231 ) 366,200 - - ( 250,045 ) 29,913 33,246 2,134 3,592 - ( 1,220 ) $ 5,317,339

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

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CHC HEALTHCARE GROUP AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax Adjustments Adjustments to reconcile profit (loss) Expected credit gain Depreciation charge Loss (gain) on disposal of property, plant and equipment Interest expense Interest income Dividend income Share of loss of associates and joint ventures accounted for using equity method Net (gain) loss on disposal of investments accounted for using equity method (Gain) loss on financial assets or liabilities at fair value through profit or loss Amortisation of discount on bonds payable Compensation cost of employee stock options Impairment loss on non-financial assets Changes in operating assets and liabilities Changes in operating assets Acquisition of financial assets at fair value through profit or loss Contract assets - current Contract assets - non-current Notes and accounts receivable Accounts receivable - related parties Other receivables Other receivables - related parties Inventories Prepayments Other current assets Changes in operating liabilities Contract liabilities - current Notes and accounts payable Accounts payable - related parties Other payables Provisions for liabilities - current Refund liabilities Other current liabilities Provisions for liabilities - non-current Cash inflow generated from operations Dividends received during the year Interest paid during the year Interest received during the year Income tax paid Net cash flows from operating activities

Notes 2019 2018 $ 476,593 $ 368,169 ( 19,068 ) ( 47,218 ) 6(9)(10)(12)(27) 411,752 428,598 6(25) 3,142 ( 279 ) 71,846 72,806 6(24) ( 11,696 ) ( 8,250 ) ( 967 ) - 6(8) 1,633 4,527 6(8)(25) ( 143 ) 350 6(2)(25) ( 17,403 ) 21,586 6(26) 12,357 15,855 6(19)(27) 5,726 3,237 6(9)(25) 12,595 1,350 6(2) - ( 74,900 ) ( 5,508 ) ( 7,029 ) ( 34,438 ) - ( 54,847 ) ( 70,932 ) 8,937 16,350 ( 943 ) 1,732 ( 25,500 ) ( 65,537 ) ( 26,113 ) ( 182,455 ) 96,680 ( 111,055 ) 1,792 ( 6,615 ) 394,698 ( 10,274 ) 13,401 77,617 ( 4,426 ) ( 134 ) 17,447 19,304 8,113 933 8,019 6,667 ( 1,861 ) 4,946 -( 345 ) 1,341,818 459,004 967 - ( 66,855 ) ( 67,535 ) 11,696 8,250 ( 97,933 ) ( 61,733 ) 1,189,693 337,986

(Continued)

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CHC HEALTHCARE GROUP AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of financial assets at amortised cost (Increase) decrease in other current assets Acquisition of investments accounted for using equity method Proceeds from disposal of investments accounted for using equity method Acquisition of property, plant and equipment Capitalised interest of property, plant and equipment Proceeds from disposal of property, plant and equipment Acquisition of investment property Increase in refundable deposits Decrease in refundable deposits Decrease (increase) in other non-current financial assets (Increase) decrease in other non-current assets Capitalised interest from increase in other non- current assets Net cash flows used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Increase in short-term loans Decrease in short-term loans Payments of lease liabilities Proceeds from long-term debt Repayments of long-term debt Increase in guarantee deposits received Decrease in guarantee deposits received Increase in other non-current liabilities Decrease in other non-current liabilities Repayments of bonds Payment of cash dividends Exercise of employee stock options Payments to acquire treasury shares Change in non-controlling interest Net cash flows used in financing activities Effect of changes in foreign currency exchange rates on cash and cash equivalents Increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year

Notes

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

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CHC HEALTHCARE GROUP AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS, EXCEPT AS OTHERWISE INDICATED)

1. HISTORY AND ORGANISATION

CHC Healthcare Group (CHC or the “Company”) was incorporated in the Republic of China. The shares of the Company were listed on the Taiwan Stock Exchange on October 24, 2012. The Company and its subsidiaries (the “Group”) are primarily engaged in the trading of pharmaceutical products and the sale, leasing, installation, and repair of medical instruments.

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

These consolidated financial statements were authorised for issuance by the Board of Directors on March 23, 2020.

1. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS

2. (1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”)

New standards, interpretations and amendments endorsed by the FSC effective from 2019 are as follows:

follows:
	Effective date by
	International Accounting
New Standards, Interpretations and Amendments	Standards Board
Amendments to IFRS 9, ‘Prepayment features with negative	January 1, 2019
compensation’
IFRS 16, ‘Leases’	January 1, 2019
Amendments to IAS 19, ‘Plan amendment, curtailment or	January 1, 2019
settlement’
Amendments to IAS 28, ‘Long-term interests in associates and joint	January 1, 2019
ventures’
IFRIC 23, ‘Uncertainty over income tax treatments’	January 1, 2019
Annual improvements to IFRSs 2015-2017 cycle	January 1, 2019

Except for the following, the above standards and interpretations have no significant impact to

the Group’s financial condition and financial performance based on the Group’s assessment. IFRS 16, ‘Leases’

• A. IFRS 16, ‘Leases’, replaces IAS 17, ‘Leases’ and related interpretations and SICs. The standard requires lessees to recognise a ‘right-of-use asset’ and a lease liability (except for

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those leases with terms of 12 months or less and leases of low-value assets). The accounting stays the same for lessors, which is to classify their leases as either finance leases or operating leases and account for those two types of leases differently. IFRS 16 only requires enhanced disclosures to be provided by lessors.

• B. The Group has elected to apply IFRS 16 by not restating the comparative information (referred herein as the ‘modified retrospective approach’) when applying “IFRSs” effective in 2019 as endorsed by the FSC. Accordingly, the Group increased ‘right-of-use asset’ by $36,089 and increased ‘lease liability’ by $36,089 with respect to the lease contracts of lessees on January 1, 2019.

• C. The Group has used the following practical expedients permitted by the standard at the date of initial application of IFRS 16:

• (a) Reassessment as to whether a contract is, or contains, a lease is not required, instead, the application of IFRS 16 depends on whether or not the contracts were previously identified as leases applying IAS 17 and IFRIC 4.

• (b) The use of a single discount rate to a portfolio of leases with reasonably similar characteristics.

• (c) The accounting for operating leases whose period will end before December 31, 2019 as short-term leases and accordingly, rent expense of $6,379 was recognised in 2019.

• (d) The exclusion of initial direct costs for the measurement of ‘right-of-use asset’.

• (e) The use of hindsight in determining the lease term where the contract contains options to extend or terminate the lease.

• D. The Group calculated the present value of lease liabilities by using the weighted average incremental borrowing interest rate of 1.7724%.

D.	The Group calculated the present value of lease liabilities by using the weighted average incremental borrowing interest rate of 1.7724%.	The Group calculated the present value of lease liabilities by using the weighted average incremental borrowing interest rate of 1.7724%.
E.	The Group recognised lease liabilities which had previously been classified as ‘operating
	leases’ under the principles of IAS 17, ‘Leases’. The reconciliation between operating lease
	commitments under IAS 17 measured at the present value of the remaining lease payments,
	discounted using the lessee’s incremental borrowing rate and lease liabilities recognised as
	of January 1, 2019 is as follows:
	Operating lease commitments disclosed by applying IAS 17 as at
	December 31, 2018	$ 43,019
	Less: Short-term leases	( 4,687)
	Less: Low-value assets	( 321)
	Total lease contracts amount recognised as lease liabilities by
	applying IFRS 16 on January 1, 2019	$ 38,011
	Incremental borrowing interest rate at the date of initial
	application	1.7724%
	Lease liabilities recognised as at January 1, 2019 by applying
	IFRS 16	$ 36,089

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

by the Group

New standards, interpretations and amendments endorsed by the FSC effective from 2020 are as follows:

follows:
New Standards, Interpretations and Amendments Amendments to IAS 1 and IAS 8, ‘Disclosure Initiative-Definition of Material’ Amendments to IFRS 3, ‘Definition of a business’ Amendments to IFRS 9, IAS 39 and IFRS 7, ‘Interest rate benchmark reform’	Effective date by International Accounting Standards Board
	January 1, 2020 January 1, 2020 January 1, 2020

The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment.

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

New standards, interpretations and amendments issued by IASB but not yet included in the IFRSs as endorsed by the FSC are as follows:

as endorsed by the FSC are as follows:
New Standards, Interpretations and Amendments	Effective date by International Accounting Standards Board
Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets between an investor and its associate or joint venture’ To be determined by International Accounting Standards Board IFRS 17, ‘Insurance contracts’ January 1, 2021 Amendments to IAS 1, ‘Classification of liabilities as current or non-current’ January 1, 2022

The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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

(1) Compliance statement

The consolidated financial statements of the Group have been prepared in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers”, International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the FSC (collectively referred herein as the “IFRSs”).

(2) Basis of preparation

• A. Except for the following items, these consolidated financial statements have been prepared under the historical cost convention:

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• (a) Financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.

• (b) Financial assets and liabilities at fair value through other comprehensive income.

• B. The preparation of financial statements in conformity with IFRSs requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5.

(3) Basis of consolidation

• A. Basis for preparation of consolidated financial statements:

• (a) All subsidiaries are included in the Group’s consolidated financial statements. Subsidiaries are all entities (including structured entities) controlled by the Group. The Group controls an entity when the Group is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Consolidation of subsidiaries begins from the date the Group obtains control of the subsidiaries and ceases when the Group loses control of the subsidiaries.

• (b) Inter-company transactions, balances and unrealised gains or losses on transactions between companies within the Group are eliminated. Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency with the policies adopted by the Group.

• (c) Profit or loss and each component of other comprehensive income are attributed to the owners of the parent and to the non-controlling interests. Total comprehensive income is attributed to the owners of the parent and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

• (d) Changes in a parent’s ownership interest in a subsidiary that do not result in the parent losing control of the subsidiary (transactions with non-controlling interests) are accounted for as equity transactions, i.e. transactions with owners in their capacity as owners. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity.

• B. Subsidiaries included in the consolidated financial statements:

Investor CHC	Main business Subsidiary activities Chiu Ho Medical System Co., Ltd. (Chiu Ho Medical) Medical instrument sale, leasing and services	Ownership (%) December 31, 2019 December 31, 2018 100 100	Description
		December 31, 2019 100

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Investor CHC CHC CHC CHC CHC CHC CHC CHC CHC CHC CHC Chiu Ho Medical Chiu Ho Medical Chiu Ho Medical Medlink SenCare CHC (BVI) CHC (BVI) CHC (BVI)	Main business Subsidiary activities Tomorrow Medical System Co., Ltd. (Tomorrow) Medical instrument sale, leasing and services Chiu Ho Scientific Co., Ltd. (Chiu Ho Scientific) Ophthalmic equipment sale, leasing and services Chiu Ho Biotech Co., Ltd. (Chiu Ho Biotech) Medical instrument leasing Ho-Shin Instruments Co., Ltd. (Ho-Shin) Medical instrument leasing Shin-Ho Instruments Co., Ltd. (Shin-Ho) Medical instrument leasing Tong-Lin Instruments Co., Ltd. (Tong-Lin) Medical instrument leasing Hua Lin Instruments Co., Ltd. (Hua Lin) Medical instrument leasing Hsin Lin Biotech Co., Ltd. (Hsin Lin) Medical instrument leasing E Century Healthcare Corporation (E Century) Medical instrument leasing J. Ab Beauty Co., Ltd. (J. Ab Beauty) Medical instrument sale, leasing and services CHC Healthcare (BVI) Limited (CHC (BVI)) Holdings and indirect investments Medlink Healthcare Limited (Medlink) Medical instrument sale SenCare Healthcare Company (SenCare) Consulting service and elderly residence PT CHC Medika Indonesia (PT CHC) Medical instrument leasing Hsing-Yeh Biotechnology Co., Ltd. (Hsing-Yeh) Medical instrument sale and leasing; drug sale CHC Long-Term Care Corporation (CHC LTC) Long-term care services CHC Healthcare (HK) Limited (CHC (HK)) Medical instrument sale, leasing and services Guangzhou Chiuho Medical System Co., Ltd. (Guangzhou Chiuho) Medical instrument sale, leasing and services Chiu Ho (CHINA) Medical Technology Co., Ltd. (Chiu Ho (CHINA)) Medical instrument sale, leasing and services	Ownership (%) December 31, 2019 December 31, 2018 100 100 100 100 100 100 - - 100 100 100 100 100 100 100 100 100 100 - - 100 100 100 100 66 66 100 - 100 100 97 - 100 100 100 100 100 100	Description
		December 31, 2019 100 100 100 - 100 100 100 100 100 - 100 100 66 100 100 97 100 100 100
			Note 4 Note 4 Note 1 Note 3 Note 5 Note 6

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Investor Guangzhou Chiuho	Main business Subsidiary activities Neusoft CHC Medical Service Co., Ltd. (Neusoft CHC) Medical instrument leasing	Ownership (%) December 31, 2019 December 31, 2018 51 51	Description
		December 31, 2019 51
			Note 2

• Note 1: The shareholders resolved to dissolve the Company’s subsidiary, J. Ab Beauty Co., Ltd., during their meeting on April 20, 2018. Consequently, the Company no longer controls J. Ab Beauty Co., Ltd., and the liquidation was completed on July 23, 2019.

• Note 2: On June 12, 2018, the Company’s subsidiary, Guangzhou Chiuho, established Neusoft CHC which was included in the consolidated financial statements thereafter.

• Note 3: On September 27, 2018, the Company’s subsidiary, Chiu Ho Medical, established SenCare which was included in the consolidated financial statements thereafter.

• Note 4: The Company’s subsidiary, Ho-Shin Instruments Co., Ltd., was merged into Chiu Ho Scientific Co., Ltd. on December 12, 2018, with Chiu Ho Scientific Co., Ltd. as the surviving company. Under the merger, the Company held a 100% equity interest in Chiu Ho Scientific Co., Ltd. As the merger was made in line with the group restructuring, there is no significant impact to the parent company’s shareholder’s equity.

• Note 5: On May 2, 2019, the Company’s subsidiary, Chiu Ho Medical, invested in PT CHC which was included in the consolidated financial statements thereafter.

• Note 6: On December 31, 2019, the Company’s subsidiary, SenCare, established CHC LTC which was included in the consolidated financial statements thereafter.

• C. Subsidiaries not included in the consolidated financial statements: None.

• D. Adjustments for subsidiaries with different balance sheet dates: None.

• E. Significant restrictions: None.

• F. Subsidiaries that have non-controlling interests that are material to the Group: None.

(4) Foreign currency translation

Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”). The consolidated financial statements are presented in New Taiwan Dollars, which is the Company’s functional and the Group’s presentation currency.

• A. Foreign currency transactions and balances

• (a) Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions are recognised in profit or loss in the period in which they arise.

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• (b) Monetary assets and liabilities denominated in foreign currencies at the period end are re-translated at the exchange rates prevailing at the balance sheet date. Exchange differences arising upon re-translation at the balance sheet date are recognised in profit or loss.

• (c) All foreign exchange gains and losses are presented in the statement of comprehensive income within ‘other gains or losses’.

• B. Translation of foreign operations

The operating results and financial position of all the group entities and associates that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

  - (a) Assets and liabilities for each balance sheet presented are translated at the closing exchange rate at the date of that balance sheet;

  - (b) Income and expenses for each statement of comprehensive income are translated at average exchange rates of that period; and

  - (c) All resulting exchange differences are recognised in other comprehensive income.

• (5) Classification of current and non-current items

• A. Assets that meet one of the following criteria are classified as current assets; otherwise they are classified as non-current assets:

  • (a) Assets arising from operating activities that are expected to be realised, or are intended to be sold or consumed within the normal operating cycle;

  • (b) Assets held mainly for trading purposes;

  • (c) Assets that are expected to be realised within twelve months from the balance sheet date;

  • (d) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to pay off liabilities more than twelve months after the balance sheet date.

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• B. Liabilities that meet one of the following criteria are classified as current liabilities; otherwise they are classified as non-current liabilities:

  • (a) Liabilities that are expected to be paid off within the normal operating cycle;

  • (b) Liabilities arising mainly from trading activities;

  • (c) Liabilities that are to be paid off within twelve months from the balance sheet date;

  • (d) Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. 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 equivalents

Cash equivalents refer to short-term highly liquid investments that are readily convertible to known amount of cash and subject to an insignificant risk of changes in value. Time deposits that meet the definition above and are held for the purpose of meeting short-term cash commitment in operations are classified as cash equivalents.

• (7) Financial assets at fair value through profit or loss

• A. Financial assets at fair value through profit or loss are financial assets that are not measured at amortised cost or fair value through other comprehensive income.

• B. On a regular way purchase or sale basis, financial assets at fair value through profit or loss are recognised and derecognised using trade date accounting.

• C. At initial recognition, the Group measures the financial assets at fair value and recognises the transaction costs in profit or loss. The Group subsequently measures the financial assets at fair value, and recognises the gain or loss in profit or loss.

• D. The Group recognises the dividend income when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Group and the amount of the dividend can be measured reliably.

• (8) Financial assets at fair value through other comprehensive income

• A. Financial assets at fair value through other comprehensive income comprise equity securities which are not held for trading, and for which the Group has made an irrevocable election at initial recognition to recognise changes in fair value in other comprehensive income.

• B. On a regular way purchase or sale basis, financial assets at fair value through other comprehensive income are recognised and derecognised using trade date accounting.

• C. At initial recognition, the Group measures the financial assets at fair value plus transaction costs. The Group subsequently measures the financial assets at fair value:

  • The changes in fair value of equity investments that are recognised in other comprehensive income are reclassified to retained earnings. When the equity instruments are derecognised the cumulative gain or loss previously recognised in other comprehensive income is not reclassified from equity to profit or loss. Dividends are recognised as revenue when the right

~21~

to receive payment is established, future economic benefits associated with the dividend will flow to the Group and the amount of the dividend can be measured reliably.

(9) Financial assets at amortised cost

The Group’s time deposits which do not fall under cash equivalents are those with a short maturity period and are measured at initial investment amount as the effect of discounting is immaterial.

(10) Accounts and notes receivable

• A. Accounts and notes receivable entitle the Group a legal right to receive consideration in exchange for transferred goods or rendered services.

• B. The short-term accounts and notes receivable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

(11) Impairment of financial assets

For financial assets at amortised cost including accounts receivable or contract assets that have a significant financing component, lease receivables, at each reporting date, the Group recognises the impairment provision for 12 months expected credit losses if there has not been a significant increase in credit risk since initial recognition or recognises the impairment provision for the lifetime expected credit losses (ECLs) if such credit risk has increased since initial recognition after taking into consideration all reasonable and verifiable information that includes forecasts. On the other hand, for accounts receivable or contract assets that do not contain a significant financing component, the Group recognises the impairment provision for lifetime ECLs.

(12) Derecognition of financial assets

The Group derecognises a financial asset when the contractual rights to receive the cash flows from the financial asset expire.

- (13) Leasing arrangements (lessor) lease receivables/ operating leases

• A. Based on the terms of a lease contract, a lease is classified as a finance lease if the lessee assumes substantially all the risks and rewards incidental to ownership of the leased asset.

• (a) At commencement of the lease term, the lessor should record a finance lease in the balance sheet as ‘lease receivables’ at an amount equal to the net investment in the lease (including initial direct costs). The difference between gross lease receivable and the present value of the receivable is recognised as ‘unearned finance income of finance lease’.

• (b) The lessor should allocate finance income over the lease term based on a systematic and rational basis reflecting a constant periodic rate of return on the lessor’s net investment in the finance lease.

• (c) Lease payments (excluding costs for services) during the lease term are applied against the gross investment in the lease to reduce both the principal and the unearned finance income.

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• B. Lease income from an operating lease (net of any incentives given to the lessee) is recognised in profit or loss on a straight-line basis over the lease term.

• C. If the Group recognises rental revenue based on a certain percentage of lessees’ operating revenue, then the rent is belong to a contingent rent, which should be treated as an operating lease. The revenue will be recognised based on the receivable rents during the contract period.

(14) Inventories

Inventories are stated at the lower of cost and net realizable value. Cost is determined using the weighted-average method. The item by item approach is used in applying the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and applicable variable selling expenses. Some subsidiaries entered into an agency contract with the original equipment manufacturer for repair parts. Under a range of guarantee paid by subsidiaries, repair parts will be provided by the original equipment manufacturer without consideration. Subsidiaries return those repair parts, and the original equipment manufacturer returns the guarantee if the agency contract is terminated.

(15) Investments accounted for using the equity method / associates

• A. Associates are all entities over which the Group has significant influence but not control. In general, it is presumed that the investor has significant influence, if an investor holds, directly or indirectly 20 percent or more of the voting power of the investee. Investments in associates are accounted for using the equity method and are initially recognised at cost.

• B. The Group’s share of its associates’ post-acquisition profits or losses is recognised in profit or loss, and its share of post-acquisition movements in other comprehensive income is recognised in other comprehensive income. When the Group’s share of losses in an associate equals or exceeds the Group’s interest in the associate, including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the associate.

• C. When changes in an associate’s equity do not arise from profit or loss or other comprehensive income of the associate and such changes do not affect the Group’s ownership percentage of the associate, the Group recognises change in ownership interests in the associate in ‘capital surplus’ in proportion to its ownership.

• D. Unrealised gains on transactions between the Group and its associates are eliminated to the extent of the Group’s interest in the associates. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been adjusted where necessary to ensure consistency with the policies adopted by the Group.

• E. When the Group disposes its investment in an associate and loses significant influence over this associate, the amounts previously recognised in other comprehensive income in relation to the associate, are reclassified to profit or loss, on the same basis as would be required if the relevant assets or liabilities were disposed of. If it retains significant influence over this

~23~

associate, the amounts previously recognised in other comprehensive income in relation to the associate are reclassified to profit or loss proportionately in accordance with the aforementioned approach.

(16) Property , plant and equipment

• A. Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during the construction period are capitalised.

• B. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.

• C. Land is not depreciated. Other property, plant and equipment apply cost model and are depreciated using the straight-line method to allocate their cost over their estimated useful lives. 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 must be depreciated separately.

• D. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each financial year-end. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in estimate under IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and Errors’, from the date of the change.

The estimated useful lives of property, plant and equipment are as follows:

Buildings and structures 40 ~ 50 years Transportation equipment 5 years Machinery and equipment 5 ~ 12 years Leased assets-Machinery and equipment 1.33 ~ 50 years Leased assets-others 2 ~ 15 years Other equipment 1~ 10 years

(17) Leasing arrangements (lessee) － right-of-use assets/ lease liabilities

Effective 2019

• A. Leases are recognised as a right-of-use asset and a corresponding lease liability at the date at which the leased asset is available for use by the Group. For short-term leases or leases of low-value assets, lease payments are recognised as an expense on a straight-line basis over the lease term.

• B. Lease liabilities include the net present value of the remaining lease payments at the commencement date, discounted using the incremental borrowing interest rate. Lease payments are comprised of fixed payments, less any lease incentives receivable.

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The Group subsequently measures the lease liability at amortised cost using the interest method and recognises interest expense over the lease term. The lease liability is remeasured and the amount of remeasurement is recognised as an adjustment to the right-of-use asset when there are changes in the lease term or lease payments and such changes do not arise from contract modifications.

• C. At the commencement date, the right-of-use asset is stated at cost comprising the following:

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

• (b) Any lease payments made at or before the commencement date; and

• (c) Any initial direct costs incurred by the lessee.

The right-of-use asset is measured subsequently using the cost model and is depreciated from the commencement date to the earlier of the end of the asset’s useful life or the end of the lease term. When the lease liability is remeasured, the amount of remeasurement is recognised as an adjustment to the right-of-use asset.

(18) Operating leases (lessee)

Prior to 2019

Payments made under an operating lease (net of any incentives received from the lessor) are recognised in profit or loss on a straight-line basis over the lease term.

• (19) Investment property

An investment property is stated initially at its cost and measured subsequently using the cost model. Except for land, investment property is depreciated on a straight-line basis over its estimated useful life of 10~55 years.

(20) Intangible assets

Goodwill arises in a business combination accounted for by applying the acquisition method.

(21) Impairment of non-financial assets

• A. The Group assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. Except for goodwill, when the circumstances or reasons for recognising impairment loss for an asset in prior years no longer exist or diminish, the impairment loss is reversed. The increased carrying amount due to reversal should not be more than what the depreciated or amortised historical cost would have been if the impairment had not been recognised.

• B. The recoverable amounts of Goodwill, intangible assets with an indefinite useful life and intangible assets that have not yet been available for use an evaluated periodically. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. Impairment loss of goodwill previously recognised in profit or loss

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shall not be reversed in the following years.

• C. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash-generating units, or groups of cash-generating units, that is/are expected to benefit from the synergies of the business combination. Each unit or group of units to which the goodwill is allocated represents the lowest level within the entity at which the goodwill is monitored for internal management purposes. Goodwill is monitored at the operating segment level.

(22) Borrowings

Borrowings comprise long-term and short-term bank borrowings.

Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in profit or loss over the period of the borrowings using the effective interest method.

(23) Notes and accounts payable

• A. Accounts payable are liabilities for purchases of raw materials, goods or services and notes payable are those resulting from operating and non-operating activities.

• B. The short-term notes and accounts payable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

(24) Convertible bonds payable

Convertible bonds issued by the Group contain conversion options (that is, the bondholders have the right to convert the bonds into the Group’s common shares by exchanging a fixed amount of cash for a fixed number of common shares), call options and put options. The Group classifies the bonds payable upon issuance as a financial asset, a financial liability or an equity instrument in accordance with the contract terms. They are accounted for as follows:

• A. The embedded call options and put options are recognised initially at net fair value as ‘financial assets or financial liabilities at fair value through profit or loss’. They are subsequently remeasured and stated at fair value on each balance sheet date; the gain or loss is recognised as ‘gain or loss on valuation of financial assets or financial liabilities at fair value through profit or loss’.

• B. The host contracts of bonds are initially recognised at fair value. Any difference between the initial recognition and the redemption value is accounted for as the premium or discount on bonds payable and subsequently is amortised in profit or loss as an adjustment to ‘finance costs’ over the period of circulation using the effective interest method.

• C. The embedded conversion options which meet the definition of an equity instrument are initially recognised in ‘capital surplus-share options’ at the residual amount of total issue price less the amount of financial assets or financial liabilities at fair value through profit or loss and bonds payable as stated above. Conversion options are not subsequently remeasured.

~26~

• D. Any transaction costs directly attributable to the issuance are allocated to each liability or equity component in proportion to the initial carrying amount of each abovementioned item.

• E. When bondholders exercise conversion options, the liability component of the bonds (including bonds payable and ‘financial assets or financial liabilities at fair value through profit or loss’) shall be remeasured on the conversion date. The issuance cost of converted common shares is the total book value of the abovementioned liability component and ‘capital surplus - share options’.

(25) Derecognition of financial liabilities

• A financial liability is derecognised when the obligation specified in the contract is discharged or cancelled or expires.

• (26) Offsetting financial instruments

Financial assets and liabilities are offset and reported in the net amount in the balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.

• (27) Provisions

Provisions (including warranties and decommissioning) are recognised when the Group has a present legal or constructive obligation as a result of past events, and it is probable that an outflow of economic resources will be required to settle the obligation and the amount of the obligation can be reliably estimated. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation on the balance sheet date, which is discounted using a pre-tax discount rate that reflects the current market assessments of the time value of money and the risks specific to the obligation. When discounting is used, the increase in the provision due to passage of time is recognised as interest expense. Provisions are not recognised for future operating losses.

(28) Employee benefits

• A. Short-term employee benefits

Short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in respect of service rendered by employees in a period and should be recognised as expense in that period when the employees render service.

• B. Pensions

For defined contribution plans, the contributions are recognised as pension expense when they are due on an accrual basis. Prepaid contributions are recognised as an asset to the extent of a cash refund or a reduction in the future payments.

• C. Employees’ compensation and directors’ and supervisors’ remuneration

• Employees’ compensation and directors’ and supervisors’ remuneration are recognised as expenses and liabilities, provided that such recognition is required under legal or

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constructive obligation and those amounts can be reliably estimated. Any difference between the resolved amounts and the subsequently actual distributed amounts is accounted for as changes in estimates. If employee compensation is distributed by shares, the Group calculates the number of shares based on the closing price at the previous day of the board meeting resolution.

- (29) Employee share based payment

• A. For the equity-settled share-based payment arrangements, the employee services received are measured at the fair value of the equity instruments granted at the grant date, and are recognised as compensation cost over the vesting period, with a corresponding adjustment to equity. The fair value of the equity instruments granted shall reflect the impact of market vesting conditions and non-vesting conditions. Compensation cost is subject to adjustment based on the service conditions that are expected to be satisfied and the estimates of the number of equity instruments that are expected to vest under the non-market vesting conditions at each balance sheet date. Ultimately, the amount of compensation cost recognised is based on the number of equity instruments that eventually vest.

• B. The grant date of the share-based payment arrangements is the date that subscription price and shares are determined.

(30) Income tax

• A. The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or items recognised directly in equity, in which cases the tax is recognised in other comprehensive income or equity.

• B. The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions where appropriate based on the amounts expected to be paid to the tax authorities. An additional tax is levied on the unappropriated retained earnings and is recorded as income tax expense in the year the stockholders resolve to retain the earnings.

• C. Deferred tax is recognised, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated balance sheet. However, the deferred tax is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred tax is provided on temporary differences arising on investments in subsidiaries and associates, except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will

~28~

not reverse in the foreseeable future. Deferred tax is determined using tax rates and laws that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.

• D. Deferred tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised. At each balance sheet date, unrecognised and recognised deferred tax assets are reassessed.

• E. Current income tax assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. Deferred tax assets and liabilities are offset on the balance sheet when the entity has the legally enforceable right to offset current tax assets against current tax liabilities and they are levied by the same taxation authority on either the same entity or different entities that intend to settle on a net basis or realise the asset and settle the liability simultaneously.

• (31) Treasury share

Where the Company repurchases the Company’s equity share capital that has been issued, the consideration paid, including any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the Company’s equity holders. Where such shares are subsequently reissued, the difference between their book value and any consideration received, net of any directly attributable incremental transaction costs and the related income tax effects, is included in equity attributable to the Company’s equity holders.

• (32) Dividends

Dividends are recorded in the Company’s financial statements in the period in which they are resolved by the Company’s shareholders. Cash dividends are recorded as liabilities; stock dividends are recorded as stock dividends to be distributed and are reclassified to ordinary shares on the effective date of new shares issuance.

(33) Revenue recognition

• A. Sales of goods

• (a) The Group sells medicine and medical equipment. Sales are recognised when control of the products has transferred, and there is no unfulfilled obligation that could affect the customer’s acceptance of the products. Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the products in accordance with the sales contract, or the Group has objective evidence that all criteria for acceptance have been satisfied.

• (b) The Group’s obligation to provide maintenance and repair services for faulty products under the standard warranty terms is recognised as a provision.

• (c) A receivable is recognised when the goods are delivered as this is the point in time that

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the consideration is unconditional because only the passage of time is required before the payment is due.

• (d) Installment sales with periodic collections of consideration

Revenue attributable to the sales price (excluding interest) is recognised on the date of sale. The sales price is the present value of consideration to be collected, calculated by discounting future payments receivable. Interest income is recognised when earned using the effective interest method.

• B. Maintenance, repair, and installation service

• (a) The Group provides maintenance, repair, and installation services for medical equipment. Revenue from providing services is recognised in the accounting period in which the services are rendered. For fixed-price contracts, revenue is recognised based on the actual service provided to the end of the reporting period as a proportion of the total services to be provided. This is determined based on the actual cost spent relative to the total expected cost. The customer pays at the time specified in the payment schedule. If the services rendered exceed the payment, a contract asset is recognised. If the payments exceed the services rendered, a contract liability is recognised.

• (b) Certain customer contracts include equipment sale and installation services. In such contracts, the Group provides a significant service of integrating goods and services into a combined item, therefore the equipment and the installation service cannot be separately identified. The timing of revenue recognition is the same as that of the sale of goods.

• (c) The Group’s estimate about revenue, costs and progress towards complete satisfaction of a performance obligation is subject to a revision whenever there is a change in circumstances. Any increase or decrease in revenue or costs due to an estimate revision is reflected in profit or loss during the period when the management becomes aware of the changes in circumstances.

• (d) Revenue from a service contract in which the Group bills a fixed amount based on the period of service provided is recognised at the amount to which the Group has the right to invoice.

• C. For detailed information on rental revenue, please refer to Note 4(13).

• D. Financing components

The Group adjusts the transaction prices for the time value of money if the contracts where the period between the transfer of the promised goods or services to the customer and payment by the customer exceeds one year.

(34) Business combinations

• A. The Group uses the acquisition method to account for business combinations. The consideration transferred for an acquisition is measured as the fair value of the assets transferred, liabilities incurred or assumed and equity instruments issued at the acquisition

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date, plus the fair value of any assets and liabilities resulting from a contingent consideration arrangement. All acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. For each business combination, the Group measures at the acquisition date components of non-controlling interests in the acquiree that are present ownership interests and entitle their holders to the proportionate share of the entity’s net assets in the event of liquidation at either fair value or the present ownership instruments’ proportionate share in the recognised amounts of the acquiree’s identifiable net assets. All other non-controlling interests should be measured at the acquisition-date fair value.

• B. The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the fair value of any previous equity interest in the acquiree over the fair value of the identifiable assets acquired and the liabilities assumed is recorded as goodwill at the acquisition date. If the total of consideration transferred, non-controlling interest in the acquire recognised and the fair value of previously held equity interest in the acquiree is less than the fair value of the identifiable assets acquired and the liabilities assumed, the difference is recognised directly in profit or loss on the acquisition date.

(35) Operating segments

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments.

5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF ASSUMPTION UNCERTAINTY

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

• (1) Critical judgements in applying the Group’s accounting policies

Except for the accounting estimates (detailed in (2) below), the management does not make any judgement that significantly affect the recognised amounts in consolidated financial statements when applying the Group’s accounting polices.

(2) Critical accounting estimates and assumptions

The Group makes estimates and assumptions based on the expectation of future events that are believed to be reasonable under the circumstances at the end of the reporting period. The resulting accounting estimates might be different from the actual results. The estimates and assumptions that may significantly adjust the carrying amounts of assets and liabilities within the next financial

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year are addressed below:

• A. Impairment assessment of tangible assets

The Group assesses impairment based on its subjective judgement and determines the separate cash flows of a specific group of assets, useful lives of assets and the future possible income and expenses arising from the assets depending on how assets are utilised and industrial characteristics. Any changes of economic circumstances or estimates due to the change of Group strategy might cause material impairment on assets in the future.

• B. Impairment assessment of goodwill

The impairment assessment of goodwill relies on the Group’s subjective judgement, including identifying cash-generating units, allocating assets and liabilities as well as goodwill to related cash-generating units, and determining the recoverable amounts of related cash-generating units.

6. DETAILS OF SIGNIFICANT ACCOUNTS

(1) Cash and cash equivalents

Cash on hand Checking accounts and demand deposits Time deposits	December 31, 2019 $ 1,317 1,113,477 130,441 $ 1,245,235	December 31, 2018 $ 1,299 1,093,394 114,943 $ 1,209,636

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

• B. The Group classified restricted cash and cash equivalents pledged to others as other current assets and other non-current financial assets. Please refer to Note 8 for details.

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

Items Current items: Financial assets mandatorily measured at fair value through profit or loss Listed stocks Non-hedging derivatives (Redemption rights to the third domestic issuance of secured convertible corporate bonds) Valuation adjustment (	December 31, 2019 $ 74,900 284 3,815) ( $ 71,369	December 31, 2018 $ 74,900 - 21,418) $ 53,482

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Items December 31, 2019 December 31, 2018

Non-current items:

Financial assets mandatorily measured at fair value through profit or loss Non-hedging derivatives (Redemption rights to the third domestic issuance of secured convertible corporate bonds) Valuation adjustment	$ - - $-	$ 292 200 $ 492

For the years ended December 31, 2019 and 2018, net gain (loss) on financial assets at fair value through profit or loss was $17,403 and ($21,586), respectively, shown as ‘other gains and losses’.

(3) Financial assets at fair value through other comprehensive income

Items Non-current items: Listed stocks Swissray Global Healthcare Holding Ltd. Unlisted stocks AESolution Biomedical Co., Ltd. Huede Healthtech Co., Ltd. Valuation adjustment (	December 31, 2019 $ 340,215 39,000 2,400 342,934) ( $ 38,681	December 31, 2018 $ 340,215 39,000 2,400 334,384) $ 47,231

• A. The Group has elected to classify equity investments that are considered to be strategic investments as financial assets at fair value through other comprehensive income. The fair value of such investments amounted to $38,681 and $47,231 as at December 31, 2019 and 2018, respectively.

• B. The Group recognised ($8,550) and ($42,606) in other comprehensive loss for fair value change for the years ended December 31, 2019 and 2018, respectively.

(4) Financial assets at amortised cost

Financial assets at amortised cost
Items Current items: Time deposits	December 31, 2019 $ 298,003	December 31, 2018
		$-

• A. Amounts recognised in profit or loss in relation to financial assets at amortised cost are listed below:

below:
Interest income	Years ended December 31, 2019 2018 $ 2,420 $-
	2019 $ 2,420

• B. The Group’s financial assets at amortised cost are time deposits in banks. Banks that the Group transacted with all have high credit quality.

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• C. As of December 31, 2019, no financial assets at amortised cost held by the Group were pledged to others.

• (5) Notes and accounts receivable (including long term notes and accounts receivable)

	December 31, 2019	December 31, 2018
Notes receivable	$ 24,711	$ 19,059
Installment notes receivable	71,973	49,761
Less: Unrealised interest revenue-installment
notes receivable	( 4,147)	( 2,085)
Accounts receivable	394,190	475,791
Installment accounts receivable	259,310	146,700
Less: Unrealised interest revenue-installment
accounts receivable	( 10,119)	( 7,076)
Lease payments receivable	4,549	3,396
Less: Unearned finance income of finance lease( 150)		( 41)
	740,317	685,505
Less: Allowance for doubtful accounts	( 2,101)	( 21,207)
	$ 738,216	$ 664,298
A. The ageing analysis of notes and accounts receivable is as follows:
	December 31, 2019	December 31, 2018
Not past due	$ 711,744	$ 648,194
Up to 1 month	10,780	6,303
Up to 2 months	935	6,081
Up to 3 months	120	4,548
Up to 4 months	210	1,000
Up to 5 months	1,992	-
Up to 6 months	-	-
Over 6 months	14,536	19,379
	$ 740,317	$ 685,505

The above ageing analysis was based on past due date.

• B. The Group expected to recover installment notes and accounts receivable as follows:

Not later than one year Over one year	December 31, 2019 $ 145,236 171,781 $ 317,017	December 31, 2018 $ 69,422 117,878 $ 187,300

• C. As of December 31, 2019, December 31, 2018 and January 1, 2018, the balances of receivables (including long-term receivables) from contracts with customers amounted to $536,430, $463,680, and $393,268, respectively.

• D. For the years ended December 31, 2019 and 2018, the interest income is recognised in profit or loss of $10,379 and $5,703, respectively.

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E. Lease payments receivable

Prior to 2019

The Group leases certain machinery and other equipment through finance leases. Under the terms of the agreement, the lease term is for the major part of the economic life of the underlying asset, and the unguaranteed residual value is $0. The Group expects all lease payments to be collected on time. The gross investments in those leases and present value of total minimum lease payments receivable as at December 31, 2018 were as follows:

Current Not later than one year	December 31, 2018	December 31, 2018	Net lease payments receivable $ 3,355
	Total lease payments receivable $ 3,396 (	Unearned finance income $ 41)

• F. For information on notes and accounts receivable pledged as collateral, please refer to Note 8.

• G. Information relating to credit risk of notes and accounts receivable is provided in Note 12(2).

• H. Information about the long-term notes receivable that was pledged to others as collaterals is provided in Note 8.

(6) Inventories

Inventories
Merchandise inventories Inventory in transit Less: Collateral pledged ( Merchandise inventories Inventory in transit Less: Collateral pledged (	December 31, 2019	Book value $ 479,150 68,658 108,134) $ 439,674 Book value $ 507,303 77,006 94,332) $ 489,977
	Allowance for Cost valuation loss $ 546,942 ($ 67,792) 68,658 - 108,134) - ( $ 507,466 ($ 67,792) December 31, 2018
	Allowance for Cost valuation loss $ 575,527 ($ 68,224) 77,006 - 94,332) - ( $ 558,201 ($ 68,224)

• A. The abovementioned inventories were not secured or pledged to others.

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B. The cost of inventories recognised as expense and operating costs for the year:

	Years ended	December 31,	December 31,
	2019		2018
Cost of goods sold	$ 1,315,856	$	900,700
Repair supplies	62,760		67,119
Loss on decline in market value and
obsolescence	( 61)		12,850
Others	-		23
Cost of inventories	1,378,555		980,692
Cost of rental	649,193		688,352
Cost of services	116,302		107,636
Total operating costs	$ 2,144,050	$	1,776,680

The Group reversed a previous inventory write-down which was accounted for as deduction of cost of goods sold as certain inventories which were previously provided with allowance were subsequently sold in 2019.

(7) Prepayments

Prepayments to suppliers Excess business tax paid Others	December 31, 2019 $ 313,752 10,149 39,109 $ 363,010	December 31, 2018 $ 381,741 35,049 42,915 $ 459,705

(8) Investments accounted for using equity method

Investments accounted for using equity	method
Associates PT. NAVI Medical Indonesia Neusoft-CHC office of Medical Intelligence & Services, Shenyang Dalian Neusoft Kangrui Jiuhe Medical Management Co., Ltd. CHENG-HSIN Biotechnology Co., Ltd	December	31, 2019 Book value $ - - 8,686 277 $ 8,963	December 31, 2018 Ownership Book % value - $ - 40% 8,232 40% 8,943 40% 1,309 $ 18,484
	Ownership % - - 40% 40%		Ownership % - 40% 40% 40%

• A. The summarised financial information of the associates that are not material to the Group is as follows:

as follows:
	Years ended	December 31,
	2019	2018
Loss for the year	($ 1,633)	($	4,527)
Other comprehensive loss, net of tax	-		-
Total comprehensive loss for the year	($ 1,633)	($	4,527)

• B. The shareholders resolved to dissolve PT. NAVI Medical Indonesia during their meeting on May 22, 2017. The liquidation of the company was completed on February 7, 2018.

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• C. The Group sold all its equity interests in Neusoft-CHC office of Medical Intelligence & Services, Shenyang on May 1, 2019 and recognised gain on disposal of investments amounting to $143.

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(9) Property, plant and equipment

At January 1, 2019 Cost Accumulated depreciation and impairment 2019 Opening net book amount as at January 1 Additions (Note 1) Disposals Depreciation charge Impairment loss Reclassifications (Note 2) Net exchange differences Closing net book amount as at December 31 At December 31, 2019 Cost Accumulated depreciation and impairment	Buildings and Transportation Machinery and Leased assets- machinery and Leased assets- Land structures equipment equipment equipment others $ 940,731 $ 130,251 $ 6,981 $ 100,733 $ 4,947,846 $ 900,344 - ( 17,474) ( 4,784) ( 92,872) ( 2,154,983) ( 508,667) ( $ 940,731 $ 112,777 $ 2,197 $ 7,861 $ 2,792,863 $ 391,677 $ 940,731 $ 112,777 $ 2,197 $ 7,861 $ 2,792,863 $ 391,677 - 118,748 - 22,076 7,792 5,069 - - - - ( 73,899) ( 478) - ( 4,578) ( 1,183) ( 3,113) ( 312,532) ( 66,846) - - - - ( 10,000) - - 264,717 - 1,384 167,765 10,662 - ( 3,177) ( 14) ( 65) ( 1,624) ( 44) $ 940,731 $ 558,487 $ 1,000 $ 28,143 $ 2,570,365 $ 340,040 $ 940,731 $ 580,096 $ 6,949 $ 127,469 $ 4,992,431 $ 903,669 - ( 21,609) ( 5,949) ( 99,326) ( 2,422,066) ( 563,629) ( $ 940,731 $ 558,487 $ 1,000 $ 28,143 $ 2,570,365 $ 340,040	Leasehold Other Construction in progress and equipment under improvements equipment acceptance Total $ 940 $ 25,992 $ 494,436 $ 7,548,254 940) ( 15,598) - ( 2,795,318) $- $ 10,394 $ 494,436 $ 4,752,936 $ - $ 10,394 $ 494,436 $ 4,752,936 - 5,323 117,975 346,983 - ( 42) - ( 74,419) - ( 3,127) - ( 391,379) - - - ( 10,000) - 1,581 ( 373,873) 72,236 - ( 13) ( 3) ( 4,940) $- $ 14,116 $ 238,535 $ 4,691,417 $ 904 $ 32,269 $ 238,535 $ 7,823,053 904) ( 18,153) - ( 3,131,636) $- $ 14,116 $ 238,535 $ 4,691,417

Note 1: The acquisition of property, plant and equipment includes the beginning and end balances of payable on machinery and equipment in the amounts of $72,340 and $75,015, respectively, and the cash payment in the amount of $344,308.

Note 2: Reclassifications with no cash flow effect are as follows:

• (a) Inventories transferred to property, plant and equipment amounted to $79,654.

• (b) Property, plant and equipment transferred to prepayments amounted to $907.

• (c) Property, plant and equipment transferred to inventories amounted to $2,021.

• (d) Property, plant and equipment transferred to investment property amounted to $2,623.

• (e) Property, plant and equipment transferred to lease payments receivable amounted to $1,867.

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											Constructions in
			Buildings		Machinery	Leased assets-					progress and
			and	Transportation	and	machinery and	Leased assets-	Leasehold		Other	equipment under
	Land		structures	equipment	equipment	equipment	others	improvements		equipment	acceptance	Total
At January 1, 2018
Cost	$ 989,241		$ 132,296	$ 9,745	$ 207,665	$ 4,959,708	$ 852,959	$ 10,996		$ 24,109	$ 144,923	$7,331,642
Accumulated
depreciation and
impairment		-	( 14,678)	( 5,855)	( 169,489)	( 2,069,977)	( 439,053)	( 10,783)		( 12,545)	-	( 2,722,380)
	$ 989,241		$ 117,618	$ 3,890	$ 38,176	$ 2,889,731	$ 413,906	$ 213		$ 11,564	$ 144,923	$4,609,262
2018
Opening net book amount
as at January 1	$ 989,241		$ 117,618	$ 3,890	$ 38,176	$ 2,889,731	$ 413,906	$ 213		$ 11,564	$ 144,923	$4,609,262
Additions (Note 1)		-	-	-	-	27,961	25,976		-	1,960	369,459	425,356
Disposals		-	-	( 344)	-	-	-		-	( 20)	-	( 364)
Depreciation charge		-	( 2,992)	( 1,338)	( 11,898)	( 324,554)	( 72,400)	( 213)		( 3,112)	-	( 416,507)
Impairment loss		-	-	-	-	( 1,196)	( 154)		-	-	-	( 1,350)
Reclassifications (Note 2)	( 48,510)		-	-	( 22,170)	201,853	24,399		-	13	( 19,821)	135,764
Net exchange differences		-	( 1,849)	( 11)	3,753	( 932)	( 50)		-	( 11)	( 125)	775
Closing net book amount
as at December 31	$ 940,731		$ 112,777	$ 2,197	$ 7,861	$ 2,792,863	$ 391,677	$	-	$ 10,394	$ 494,436	$4,752,936
At December 31, 2018
Cost	$ 940,731		$ 130,251	$ 6,981	$ 100,733	$ 4,947,846	$ 900,344	$ 940		$ 25,992	$ 494,436	$7,548,254
Accumulated
depreciation and
impairment		-	( 17,474)	( 4,784)	( 92,872)	( 2,154,983)	( 508,667)	( 940)		( 15,598)	-	( 2,795,318)
	$ 940,731		$ 112,777	$ 2,197	$ 7,861	$ 2,792,863	$ 391,677	$	-	$ 10,394	$ 494,436	$4,752,936

Note 1: The acquisition of property, plant and equipment includes the beginning and end balances of payable on machinery and equipment in the amounts of $9,462 and $72,340, respectively, and the cash payment in the amount of $362,478.

Note 2: Reclassifications with no cash flow effect are as follows:

• (a) Other non-current assets transferred to property, plant and equipment amounted to $203,419.

• (b) Property, plant and equipment transferred to inventories amounted to $22,170.

• (c) Inventories transferred to property, plant and equipment amounted to $3,025.

• (d) Land transferred to investment property amounted to $48,510.

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• A. Amount of borrowing costs capitalised as part of property, plant and equipment and prepayments for business facilities (shown as other non-current assets) and the range of the interest rates for such capitalisation are as follows:

Amount capitalised Range of the interest rates for capitalisation	Years ended December 31, 2019 2018 $ 10,693 $ 8,576 1.54%~1.87% 1.64%~2.06%
	2019 $ 10,693 1.54%~1.87%

• B. The recoverable amount of the Group’s certain leased assets, machinery and equipment was lower than the carrying amount, therefore, the Group recognised impairment loss amounting to $10,000 and $1,350 for the years ended December 31, 2019 and 2018, respectively.

• C. Information about the property, plant and equipment that were pledged to others as collateral is provided in Note 8.

(10) Leasing arrangements-lessee

Effective 2019

• A. The Group leases various assets including buildings and business vehicles. Rental contracts are typically made for periods of 1 to 13 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose covenants, but leased assets may not be used as security for borrowing purposes.

• B. Short-term leases with a lease term of 12 months or less comprise business vehicles, offices and dormitories. Low-value assets comprise copy machines.

• C. The carrying amount of right-of-use assets and the depreciation charge are as follows:

		December 31, 2019	December 31, 2019	Year ended December 31, 2019
			Book value	Depreciation charge
	Buildings	$	27,170	$ 5,380
	Transportation equipment
	(Business vehicles)		2,658	1,840
		$	29,828	$ 7,220
	For the year ended December 31, 2019,		the additions to right-of-use assets was $959.
	The information on profit and loss	accounts relating to lease contracts is as follows:
				Year ended December 31, 2019
	Items affecting profit or loss
	Interest expense on lease liabilities			$ 593
	Expense on short-term lease contracts			7,387
	Expense on leases of low-value assets			190

• D. For the year ended December 31, 2019, the additions to right-of-use assets was $959.

• E. The information on profit and loss accounts relating to lease contracts is as follows:

• F. For the year ended December 31, 2019, the Group’s total cash outflow for leases was $14,969.

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(11) Leasing arrangements-lessor

Effective 2019

• A. The Group leases various assets including buildings, machinery and other equipment. Rental contracts are typically made for periods of 1 and 16 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. To protect the lessor’s ownership rights on the leased assets, leased assets may not be used as security for borrowing purposes.

• B. The Group leases machinery and equipment and other equipment under a finance lease. Based on the terms of the lease contract, the ownership of machinery and other equipment will be transferred to lessees when the leases expire. Information on profit or loss in relation to lease contracts is as follows:

Sales profit Finance income from the net investment in the finance lease	Year ended December 31, 2019 $ 4,289 2,095

• C. The maturity analysis of the undiscounted lease payments (including related parties) in the finance lease is as follows:

2020 2021 2022 2023 2024 2025 2026 and onwards	December 31, 2019 $ 28,560 19,738 15,617 11,670 7,266 - - $ 82,851

• D. Reconciliation of the undiscounted lease payments and the net investment in the finance lease is provided in Note 6(5).

• E. Gain arising from operating lease agreements for the year ended December 31, 2019 is as follows:

Gain arising from operating lease agreements for the year follows:	ended December 31, 2019 is a
租金收入 Rent income Contingent rental revenue	Year ended December 31, 2019
	$ 53,157
	$ 955,942

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F. The maturity analysis of the lease payments under the operating leases is as follows:

2020 2021 2022 2023 2024 2025 2026 and onwards	December 31, 2019 $ 51,428 48,668 48,291 1,666 1,655 380 - $ 152,088

(12) Investment property

At January 1, 2019 Cost Accumulated depreciation and impairment 2019 Opening net book amount as at January 1 Additions from accquisitions (Note 1) Reclassifications (Note 2) Depreciation charge Closing net book amount as at December 31 At December 31, 2019 Cost Accumulated depreciation and impairment	Land $ 835,419 - ( $ 835,419 $ 835,419 - - - ( $ 835,419 $ 835,419 - ( $ 835,419	Buildings and Construction structures in progress $ 498,102 $ 5,976 144,917) - ( $ 353,185 $ 5,976 $ 353,185 $ 5,976 10,099 7,671 17,167 ( 5,976) 13,153) - ( $ 367,298 $ 7,671 $ 525,368 $ 7,671 158,070) - ( $ 367,298 $ 7,671	Total $1,339,497 144,917) $1,194,580 $1,194,580 17,770 11,191 13,153) $1,210,388 $1,368,458 158,070) $1,210,388

Note 1: The acquisition of investment property with cash payment in the amount of $17,770.

Note 2: Reclassifications with no cash flow effects are as follows:

• (1) Lease payments receivable transferred to investment property amounted to $8,568.

• (2) Property, plant and equipment transferred to investment property amounted to $2,623.

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At January 1, 2018 Cost Accumulated depreciation and impairment 2018 Opening net book amount as at January 1 Additions from accquisitions (Note 1) Reclassifications (Note 2) Depreciation charge Closing net book amount as at December 31 At December 31, 2018 Cost Accumulated depreciation and impairment	Land $ 786,909 - ( $ 786,909 $ 786,909 - 48,510 - ( $ 835,419 $ 835,419 - ( $ 835,419	Buildings and structures $ 498,102 132,826) $ 365,276 $ 365,276 - - 12,091) $ 353,185 $ 498,102 144,917) $ 353,185	Construction in progress $ - - ( $- $ - 4,931 1,045 - ( $ 5,976 $ 5,976 - ( $ 5,976	Total $1,285,011 132,826) $1,152,185 $1,152,185 4,931 49,555 12,091) $1,194,580 $1,339,497 144,917) $1,194,580

Note 1: The acquisition of investment property-construction in progress with cash payment in the amount of $4,931.

Note 2: Reclassifications with no cash flow effects are as follows:

Land and other non-current assets transferred to investment property amounted to $48,510 and $1,045, respectively.

• A. Rental income from lease of the investment property and direct operating expenses arising from investment property are shown below:

$48,510 and $1,045, respectively. Rental income from lease of the investment from investment property are shown below:	property and direct operating expenses arisin
Rental income from the lease of the investment property Direct operating expenses arising from the investment property that generated rental income during the year	Years ended December 31, 2019 2018 $ 51,364 $ 51,717 $ 15,805 $ 14,914
	2019 $ 51,364 $ 15,805

• B. As of December 31, 2019 and 2018, the fair value of the investment property held by the Group amounted to $1,233,008 and $1,227,844, respectively. Independent appraisers adopted comparison approach and land development analysis approach to evaluate the land, assessed the building based on cost method, and considered weights on aforementioned costs to calculate the fair value.

• C. Information about the investment property that was pledged to others as collateral is provided in Note 8.

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(13) Other financial assets-non-current

Guarantee deposits paid Restricted assets	December 31, 2019 $ 502,524 22,502 $ 525,026	December 31, 2018 $ 452,435 81,533 $ 533,968

Information about the restricted assets that were pledged to others as collateral is provided in Note 8.

(14) Other non-current assets

Deferred expenses Prepayments for equipment	December 31, 2019 $ 904 688,846 $ 689,750	December 31, 2018 $ 1,283 677,632 $ 678,915

(15) Short-term borrowings

Type of borrowings Bank borrowings Secured borrowings Credit borrowings Interest rate range	December 31, 2019 $ - 471,591 $ 471,591 1%~1.54%	December 31, 2018 $ 31,272 655,660 $ 686,932 1%~3.48%

Information about the short-term borrowings that were pledged to others as collateral is provided in Note 8.

(16) Bonds payable

Bonds payable Less: Discount on bonds payable ( Less: Current portion or exercise of put options (shown as ‘other current liabilities’) (	December 31, 2019 $ 1,169,700 10,229) ( 1,159,471 1,159,471) $-	December 31, 2018 $ 1,200,000 22,965) 1,177,035 - $ 1,177,035

• A. The terms of the second domestic secured convertible bonds issued by the Company are as follows:

• (a) The Company issued the second domestic secured convertible bonds totalling $1,000,000 with zero coupon rate as approved by the regulatory authority. The bonds mature three years from the issue date (November 10, 2015 ~ November 10, 2018) and will be redeemed in cash at face value at the maturity date. The bonds were listed on the Taipei Exchange on November 10, 2015.

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• (b) The bondholders have the right to request Taiwan Depository & Clearing Corporation (“TDCC”) through the security dealers for conversion of the bonds into common shares of the Company during the period from the date after one month of the bonds issue to the maturity date, except for the stop transfer period as specified in the terms of the bonds or the laws/regulations. The rights and obligations of the new shares converted from the bonds are the same as the issued and outstanding common shares.

• (c) The conversion price of the bonds is set up based on the pricing model in the terms of the bonds, and is subject to adjustments if the condition of the anti-dilution provisions occurs subsequently. The conversion price on the issue date is NT$58.8 (in dollars). On December 21, 2015, July 16, 2016, July 16, 2017 and July 15, 2018, the Company adjusted the conversion price per share to NT $58.4, NT $56.2, NT $54.9 and NT $53.1 (in dollars), respectively, according to the rules described above.

• (d) The bondholders have the right to require the Company to redeem any bonds at the price of the bonds’ face value plus 1% of the face value as interests upon two years from the issue date.

• (e) The Company may repurchase all the bonds outstanding in cash at the bonds’ face value at any time after the following events occur: (i) the closing price of the Company’s common shares is above the then conversion price by 30% for 30 consecutive trading days during the period from the date after one month of the bonds issue to 40 days before the maturity date, or (ii) the outstanding balance of the bonds is less than 10% of total initial issue amount during the period from the date after one months of the bonds issue to 40 days before the maturity date.

• (f) Under the terms of the bonds, all bonds redeemed (including bonds repurchased from the Taipei Exchange), matured and converted are retired and not to be re-issued; all rights and obligations attached to the bonds are also extinguished.

• (g) On November 10, 2015, the Company signed a corporate bond issuance guarantee agreement with Chinatrust Commercial Bank. Under the terms of the agreement, the Company will periodically submit a financial assurance letter to Chinatrust Commercial Bank, indicating whether the Company has achieved the required financial ratios based on the annual and semi-annual consolidated financial statements as follows:

• a. Current ratio must be 120% or higher.

• b. Debt ratio must equal to or less than 100%.

• Further, on August 17, 2018, the Company negotiated with Chinatrust Commercial Bank for the amendment of the guarantee covenants. Under the agreement, the Company will periodically submit a financial assurance letter to the banks, indicating whether the Company has achieved the required financial ratios based on the annual and semi-annual consolidated financial statements as follows:

• a. Current ratio must be 100% or higher.

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  - b. Debt ratio must equal to or less than 150%.

  - c. Interest coverage ratio must be 3 or higher.

  - d. Tangible net assets must be $4,000,000 or higher.

  - If the Company fails to meet any of the requirements stated above, Chinatrust Commercial Bank will determine whether there has been a breach of contract.

• (h) The convertible bonds matured on November 10, 2018, and were redeemed at $320,100 by cash. The Company transferred the forfeited stock options of $8,835 to capital surplus-forfeited stock options (shown as capital surplus-others).

• B. The terms of the third domestic secured convertible bonds issued by the Company are as follows:

• (a) The Company issued the third domestic secured convertible bonds totalling $1,200,000 with zero coupon rate as approved by the regulatory authority. The bonds mature three years from the issue date (November 2, 2017 ~ November 2, 2020) and will be redeemed in cash at face value at the maturity date. The bonds were listed on the Taipei Exchange on November 2, 2017.

• (b) The bondholders have the right to request TDCC through the security dealers for conversion of the bonds into common shares of the Company during the period from the date after three months of the bonds issue to the maturity date, except for the stop transfer period as specified in the terms of the bonds or the laws/regulations. The rights and obligations of the new shares converted from the bonds are the same as the issued and outstanding common shares.

• (c) The conversion price of the bonds is set up based on the pricing model in the terms of the bonds, and is subject to adjustments if the condition of the anti-dilution provisions occurs subsequently. The conversion price on the issue date is NT$42 (in dollars). On July 15, 2018 and July 15, 2019, the Company adjusted the conversion price per share to NT$40.6 and NT$38.8 (in dollars), respectively, according to the rules described above.

• (d) The Company may repurchase all the bonds outstanding in cash at the bonds’ face value at any time after the following events occur: (i) the closing price of the Company’s common shares is above the then conversion price by 30% for 30 consecutive trading days during the period from the date after three month of the bonds issue to 40 days before the maturity date, or (ii) the outstanding balance of the bonds is less than 10% of total initial issue amount during the period from the date after one months of the bonds issue to 40 days before the maturity date.

• (e) Under the terms of the bonds, all bonds redeemed (including bonds repurchased from the Taipei Exchange), matured and converted are retired and not to be re-issued; all rights and obligations attached to the bonds are also extinguished.

• (f) On August 17, 2018, the Company signed a corporate bond issuance guarantee

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agreement with Chinatrust Commercial Bank. Under the terms of the agreement, the Company will periodically submit a financial assurance letter to Chinatrust Commercial Bank, indicating whether the Company has achieved the required financial ratios based on the annual and semi-annual consolidated financial statements as follows:

  - a. Current ratio must be 100% or higher.

  - b. Debt ratio must equal to or less than 150%.

  - c. Interest coverage ratio must be 3 or higher.

  - d. Tangible net assets must be $4,000,000 or higher.

  - If the Company fails to meet any of the requirements stated above, Chinatrust Commercial Bank will determine whether there has been a breach of contract.

• (g) As of December 31, 2019, the convertible bonds totalling $30,300 (face value) had been converted into 781 thousand shares of common stock.

• C. Regarding the third issuance of secured convertible bonds, the equity conversion options amounting to $30,063 were separated from the liability component and were recognised in ‘capital surplus - others’ in accordance with IAS 32 as of December 31, 2019. The call and put options embedded in bonds payable were separated from their host contracts and were recognised in ‘financial assets or liabilities at fair value through profit or loss’ in net amount in accordance with IAS 39 because the economic characteristics and risks of the embedded derivatives were not closely related to those of the host contracts. The effective interest rates of the bonds payable after such separation ranged between 0.7362%~0.8489%.

• D. Information on assets pledged as collateral for corporate bands is provided in Note 8.

- (17) Long term borrowings

Type of borrowings Bank borrowings Secured borrowings Credit borrowings Less: Current portion (shown as 'other current liabilities') Interest rate range	Borrowing period 2006.4~2023.11 2006.4~2023.11 (	December 31, 2019 $ 2,841,412 81,957 2,923,369 832,707) ( $ 2,090,662 1.09%~1.9%	December 31, 2018 $ 2,835,598 159,606 2,995,204 182,596) $ 2,812,608 1.52%~5.88%

• A. In July 2015, the Company, Chiu Ho Medical System Co., Ltd., and Medlink Healthcare Limited signed a syndicated loan agreement in the amount of $3,300,000 with a group of lenders led by First Commercial Bank and agreed to the following terms:

• (a) Before each credit line expires, the borrower is required to draw down at least 80% of the available credit limit. If this required amount is not fully drawn down, the borrower must pay a fee, equal to 0.15% of the difference between the actual drawdown amount

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and the required amount, to the agency bank after the expiration of all credit lines. The agency bank will then distribute this fee among the syndicate lenders according to the share of credit risk each lender bears.

• (b) Loan funds must be used for a specified purpose.

• (c) The Company will periodically submit a financial assurance letter to the banks, indicating whether the Company has achieved the required financial ratios based on the annual and semi-annual consolidated financial statements as follows:

• i. Current ratio must be 100% or higher.

• ii. Debt ratio must equal to or less than 150%.

• iii. Interest coverage ratio must be 3 or higher.

• iv. Tangible net assets must be $3,800,000 or higher.

If the Company fails to meet any of the requirements stated above, remedial measures, such as capital increase, must be taken to address the issue before the financial reporting date of the next annual or half-year consolidated financial statements. If the issue is resolved with the remedial measures, it is not considered a breach of contract. However, the Company is required to pay a fee, equal to 0.1% of the unpaid principal balance on the audit date, to the agency bank, who will distribute this fee among the syndicate lenders.

The financial ratios derived from the aforementioned consolidated financial statements of the Company are in compliance with the requirements specified in the syndicated loan agreement.

• (d) The Company’s direct and/or indirect ownership percentage of Chiu Ho Medical System Co., Ltd., Hua Lin Instruments Co., Ltd., Tong-Lin Instruments Co., Ltd., E Century Healthcare Corporation, Chiu Ho Biotech Co., Ltd. and Chiu Ho Scientific Co.,Ltd. must be at least 66.67%, and the Company must maintain control over the operations of these subsidiaries. The shares of the aforementioned subsidiaries necessary to maintain the required minimum ownership percentage cannot be pledged or transferred to a third party, nor can they be placed in a trust.

• (e) The Company’s direct and/or indirect ownership percentage of its investment holding company in Myanmar and Medlink Healthcare Limited must be at least 70%, and the Company must maintain control over the operations of these subsidiaries. The shares of the aforementioned subsidiaries necessary to maintain the required minimum ownership percentage cannot be pledged or transferred to a third party, nor can they be placed in a trust.

• (f) The Company’s direct and/or indirect ownership percentage of Hsing-Yeh Biotechnology Co., Ltd must be 100%, and the Company must maintain control over the operations of the subsidiary. The shares of the aforementioned subsidiary necessary to maintain the required ownership percentage cannot be pledged or transferred to a

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third party, nor can they be placed in a trust. However, these restrictions do not apply if Hsing-Yeh Biotechnology Co., Ltd. merges with the Company and is dissolved.

If the Company fails to meet this requirement, First Commercial Bank will determine whether there has been a breach of contract and, if necessary, call a meeting with all the syndicate lenders to discuss the matter.

The financial ratios derived from the aforementioned consolidated financial statements of the Company meet the requirements specified in the syndicated loan agreement. In July 2017, the Company cancelled an unused credit line of $1,600,000, which was part of the syndicated loan agreement led by First Commercial Bank.

In November 2018, the Company fully paid in advance the outstanding principal.

• B. In November 2018, the Company and Tomorrow Medical System Co., Ltd. signed a syndicated loan agreement in the amount of $2,440,000 with a group of lenders led by First Commercial Bank and agreed to the following terms:

• (a) If the actual drawn amount is less than 80% of each available borrowing facility, the difference shall be imposed at a rate of 0.15% as a commitment fee at the end of the limit on borrowing facilities. The commitment fee shall be paid in full to the lead bank within 5 trading days after the end of the limit on borrowing facilities. Subsequently, the lead bank shall pay syndicated banks based on its committed ratio.

• (b) Loan funds must be used for a specified purpose.

• (c) The Company will periodically issue a financial assurance letter to the banks, indicating whether the Company has achieved the required financial ratios based on the annual and semi-annual consolidated financial statements as follows:

  • i. Current ratio must be 100% or higher.

  • ii. Debt ratio must equal to or less than 150%.

  • iii. Interest coverage ratio must be 3 or higher.

  • iv. Tangible net assets must be $4,000,000 or higher.

If the Company fails to meet any of the requirements stated above, remedial measures, such as capital increase, must be taken to address the issue before the financial reporting date of the next annual or half-year consolidated financial statements. If the issue is resolved with the remedial measures, it is not considered a breach of contract. However, the Company is required to pay a fee, equal to 0.1% of the unpaid principal balance on the audit date, to the agency bank, who will distribute this fee among the syndicate lenders.

• (d) The Company shall directly/indirectly hold a 100% equity interest in Tomorrow Medical System Co., Ltd., Hsing-Yeh Biotechnology Co., Ltd., Medlink Healthcare Limited and Chiu Ho Medical System Co., Ltd., and directly/indirectly hold at least a 66.67% equity interest in Hua Lin Instruments Co., Ltd., Tong-Lin Instruments Co., Ltd., E Century Healthcare Corporation, Chiu Ho Biotech Co., Ltd. and Chiu Ho

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Scientific Co., Ltd., and the Company has control over those companies’ operations. Above equity interests can not be pledged or transferred to the third party in any assumption or method as well as trust.

If the Company fails to meet this requirement, First Commercial Bank will determine whether there has been a breach of contract and, if necessary, call a meeting with all the syndicate lenders to discuss the matter.

• C. In August 2018, Guangzhou Chiuho Medical System Co., Ltd. entered into a borrowing contract with Chinatrust Commercial Bank amounting to RMB 22 million. The Company is required to hold a 100% equity interest directly/indirectly in Guangzhou Chiuho Medical System Co., Ltd. until settlement of the borrowing, or the borrowing will be deemed as matured. In June 2019, Guangzhou Chiuho Medical System Co., Ltd. fully paid in advance the outstanding principal.

• D. Information on assets pledged as collateral for long-term borrowings is provided in Note 8.

(18) Pensions

• A. Effective July 1, 2005, the Company and its domestic subsidiaries have established a defined contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular employees with R.O.C. nationality. Under the New Plan, the Company and its domestic subsidiaries contribute monthly an amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment. The pension costs under the defined contribution pension plans of the Group for the years ended December 31, 2019 and 2018 were $6,664 and $6,539, respectively.

• B. The Group’s mainland China subsidiaries have a defined contribution plan. Monthly contributions to an independent fund administered by the government in accordance with the pension regulations in the People’s Republic of China (PRC) are based on certain percentage of employees’ monthly salaries and wages. The pension plan is administered by the government. Other than the monthly contributions, the Group has no further obligations. The pension costs under the defined contribution pension plans of the Group for the years ended December 31, 2019 and 2018 were $2,105 and $2,440, respectively.

(19) Share-based payment

• A. As of December 31, 2019, the Company’s share-based payment transactions are as follows:

Type of arrangement Grant date Quantity Granted (in thousands of shares) Employee stock options-101 2012.8.31 3,000 Employee stock options-106 2018.4.13 2,000	Contract period	Vesting conditions
	7 years 7 years	Note Note

Note: After two years from the grant date, employees are allowed to exercise their stock options according to the vesting schedule specified in the plan.

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B. Details of the share-based payment arrangements are as follows:

			2019	2019			2018	2018
	No. of options			Weighted-average			No. of options	Weighted-average
	(in thousands			exercise price			(in thousands	exercise price
Stock options		of shares)		(in	dollars)		of shares)	(in dollars)
Options outstanding at
January 1		2,957		$	34.33		985	$	37.40
Options granted			-		-		2,000		34.50
Options forfeited	(	38)			34.81	(	28)		34.45
Options exercised	(	939)			35.41		-		-
Options outstanding at December 31		1,980			31.90		2,957		34.33
Options exercisable at December 31			-				977

• C. For the year ended December 31, 2019, the weighted-average stock price of stock options on exercise dates was NT$43.52 (in dollars). For the year ended December 31, 2018, no stock options were exercised.

• D. The expiry date and exercise price of stock options outstanding at balance sheet date are as follows:

follows:
Issue date approved 2012.8.31 2018.4.13	Expiry date 2019.8.30 2025.4.12	December	31, 2019 Exercise price (in dollars) $ - 31.9	December	31, 2018 Exercise price (in dollars) $ 36.2 33.4
		No. of shares (in thousands of shares) $ - 1,980		No. of shares (in thousands of shares) 977 1,980

• E. The Black Scholes option-pricing model was used for valuation of fair value of the stock options granted. The related information is listed as follows:

Type of arrangement Employee stock options-101 Employee stock options-106	Grant date 2012.8.31 2018.4.13	Stock price (in dollars) $ 85.06 (Note 1) $ 34.50	Exercise price (in dollars) $ 44.0 $ 34.5	Expected price volatility 40.44% (Note 2) 30.02%	Expected option life 5.25 years 5.25 years	Expected dividends 0% 0%	Risk-free interest rate fair value 1.00% 0.75%	Fair value per unit (in dollars)
								$48.23~ $51.29 $8.46~ $10.91

Note 1: Estimated using the market approach with necessary adjustments, the price of the common shares of the Company that have no controlling rights and cannot be traded in the open market was NT$85.06 (in dollars) on the grant date.

Note 2: Expected price volatility is estimated based on the historical stock prices of comparable companies.

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• F. Expenses incurred on the Group’s share-based payment transactions are shown below:

Equity-settled	Years ended December 31,	Years ended December 31,
	2019 $ 5,726	2018
		$ 3,237

• G. On July 15, 2019 and July 15, 2018, the exercise prices of employee stock options-101 and employee stock options-106 were adjusted to NT$34.6, NT$31.9, NT$36.2 and NT$33.4 (in dollars), respectively, according to the rules of the employee stock option plan. The adjustment of exercise prices had no significant impact on the fair value of the aforementioned stock options.

(20) Share capital

• A. As of December 31, 2019, the Company’s authorised capital was $2,500,000, consisting of 250 million shares of ordinary stock, and the paid-in capital was $1,416,335 with a par value of $10 (in dollars) per share. All proceeds from shares issued have been collected.

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

At January 1 Employee stock options exercised Bonds payable converted Shares retired At December 31	(In thousands of shares) 2019 2018 138,914 139,914 939 - 781 - - ( 1,000) 140,634 138,914

• B. Treasury shares

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

Name of company holding the shares	Reason for reacquisition To be reissued to employees	December 31, 2019 Number of shares Carrying Amount 1,000,000 $ 34,956	December 31, 2018 Number of shares Carrying Amount 1,000,000 $ 34,956
		Number of shares 1,000,000	Number of shares 1,000,000
The Company

• (b) Pursuant to the R.O.C. Securities and Exchange Act, the number of shares bought back as treasury share should not exceed 10% of the number of the Company’s issued and outstanding shares and the amount bought back should not exceed the sum of retained earnings, paid-in capital in excess of par value and realized capital surplus.

• (c) Pursuant to the R.O.C. Securities and Exchange Act, treasury shares should not be pledged as collateral and is not entitled to dividends before it is reissued.

• (d) Pursuant to the R.O.C. Securities and Exchange Act, treasury shares should be reissued to the employees within three years from the reacquisition date and shares not reissued within the three-year period are to be retired. Treasury shares to enhance the Company’s

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credit rating and the stockholders’ equity should be retired within six months of acquisition.

(21) Capital surplus

• A. Pursuant to Paragraph 4, Article 31 of the Business Mergers and Acquisitions Act, if a company becomes a wholly-owned subsidiary of another company through a share exchange, its undistributed earnings become part of the capital surplus of the acquiring company (parent company). Therefore, if the increase in the investment holding company’s capital surplus is from the undistributed earnings of the subsidiary before the share exchange, this amount can be distributed as cash dividends or capitalised. Moreover, the proportion that can be capitalised is not subject to the restrictions set forth in Article 8 of the Securities and Exchange Act Enforcement Rules. In addition, according to Tai-Cai-Rong-Yi-Zi No. 0910016280, such increase in capital surplus was not generated by the holding company’s business operations and thus will not affect the remuneration of directors and supervisors and bonuses of employees. As of December 31, 2019, capital surplus that is attributable to the undistributed earnings of Chiu Ho Medical System Co., Ltd. and other associates before share exchanges amounted to $44,390.

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

• C. Please refer to Note 6(19) for information on capital surplus - employee stock options.

(22) Retained earnings

• A. Under the Company’s Articles of Incorporation, the current year’s earnings, if any, shall first be used to pay all taxes and offset prior years’ operating losses and then 10% of the remaining amount shall be set aside as legal reserve unless legal reserve equals the authorised share capital. Special reserve is then appropriated or reversed in accordance with related regulations. At least 50% of the remainder, if any, and accumulated undistributed earnings from prior years is distributable under the stockholders’ resolution at their meeting as proposed by the Board of Directors.

• B. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in proportion to their share ownership, the legal reserve shall not be used for any other purpose. The use of legal reserve for the issuance of stocks or cash to shareholders in proportion to their share ownership is permitted, provided that the distribution of the reserve is limited to the portion in excess of 25% of the Company’s paid-in capital.

• C. In accordance with the regulations, the Company shall set aside special reserve from the

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debit balance on other equity items at the balance sheet date before distributing earnings. When debit balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings.

• D. The proposal on 2018 and 2017 earnings appropriation which were resolved at the shareholders’ meeting on June 12, 2019 and June 11, 2018, respectively, are as follows:

Legal reserve Special reserve Reversal of special reserve Cash dividends	Years ended December 31, 2018 2017 Dividends Dividends Amount per share (in dollars) Amount per share (in dollars) $ 32,342 $ - 330,410 - - ( 138,784) 250,045 $ 1.8 153,905 $ 1.1 $ 612,797 $ 15,121
	Amount $ 32,342 330,410 - 250,045 $ 612,797

The aforementioned earnings appropriations for the years ended December 31, 2018 and 2017 were in agreement with the amounts resolved by the Board of Directors during its meetings held on March 22, 2019 and March 21, 2018, respectively, and the ex-dividend dates resolved in the same meetings were July 15, 2019 and July 15, 2018, respectively. For more information on the aforementioned earnings appropriations proposed by the Board of Directors and resolved by the shareholders, please go to the Market Observation Post System website maintained by the Taiwan Stock Exchange.

• E. The appropriations for 2019 earnings as resolved by the Board of Directors on March 23, 2020 are as follows:

2020 are as follows:
Legal reserve Special reserve Cash dividends	Year ended December 31, 2019 Amount Dividends per share (in dollars) $ 39,517 24,231 281,267 $ 2 $ 345,015
	Amount $ 39,517 24,231 281,267 $ 345,015

• F. For the information relating to employees’ compensation and directors’ and supervisors’ remuneration, please refer to Note 6(27).

(23) Operating revenue

Operating revenue
Revenue from contracts with customers Rental revenue Others	Years ended December 31, 2019 2018 $ 1,930,176 $ 1,431,331 1,007,306 1,068,772 12,570 7,363 $ 2,950,052 $ 2,507,466
	2019 $ 1,930,176 1,007,306 12,570 $ 2,950,052

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A. Disaggregation of revenue from contracts with customers

The Group’s revenue is derived from the transfer of goods and services over time and at a point in time in the following major product lines:

Year ended December31,2019 Revenue from external customer contracts Timing of revenue recognition At a point in time Over time Year ended December 31, 2018 Revenue from external customer contracts Timing of revenue recognition At a point in time Over time	Sale of drugs $ 171,662 $ 171,662 - $ 171,662 Sale of drugs $ 171,500 $ 171,500 - $ 171,500	Sale of medical instruments $ 1,466,330 $ 1,466,330 - $ 1,466,330 Sale of medical instruments $ 1,000,906 $ 1,000,906 - $ 1,000,906	Repairs and maintenance and other services $ 292,184 $ - 292,184 $ 292,184 Repairs and maintenance and other services $ 258,925 $ - 258,925 $ 258,925	Total $1,930,176 $1,637,992 292,184 $1,930,176 Total $1,431,331 $1,172,406 258,925 $1,431,331

• B. Contract assets and liabilities

• (a) The Group recognised contract assets and liabilities in relation to contract revenue arising from sales, maintenance and repair of medical instrument and other services as follows:

follows:
	December 31,	2019	December 31, 2018	January 1, 2018
Contract assets	$ 80,902		$ 40,959	$ 33,933
Contract liabilities	$ 739,908		$ 339,547	$ 344,718
Revenue recognised that	was included	in the	contract liability balance at the beginnin
of the year
			Years ended December 31,
			2019	2018
Revenue recognised that	was included
in the contract liability beginning of the year	balance at the	$	23,955 $	24,444

• (b) Revenue recognised that was included in the contract liability balance at the beginning of the year

• C. Unfulfilled long-term repairs, maintenance and medical instrument contracts

Aggregate amount of the transaction price allocated to long-term contracts that are partially or fully unsatisfied as at December 31, 2019, amounted to $1,374,600. Management expects

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that the transaction price allocated to the unsatisfied contracts as of December 31, 2019 will be recognised as revenue from 2020 to 2024.

Except for the abovementioned contracts, all other repair and maintenance contracts are for periods of one year or less or are billed based on time incurred. As permitted under IFRS 15, the transaction price allocated to these unsatisfied contracts is not disclosed.

(24) Other income

Other income
Interest income: Interest income from bank deposits Interest income from financial assets measured at amortised cost Other interest income Rent income Dividend income Other income	Years ended December 31, 2019 2018 $ 5,240 $ 4,980 2,420 - 4,036 3,270 1,793 1,617 967 - 17,776 5,754 $ 32,232 $ 15,621
	2019 $ 5,240 2,420 4,036 1,793 967 17,776 $ 32,232

(25) Other gains and losses

Other gains and losses
	Years ended		December 31,
	2019		2018
(Losses) gains on disposal of property, plant
and equipment	($	3,142)	$	279
Gains (losses) on disposal of investment		143	(	350)
Net currency exchange (losses) gains	(	5,732)		6,147
Net gain (loss) on financial assets and
liabilities at fair value through profit or loss	17,403		( 21,586)
Impairment loss on property, plant and
equipment	( 10,000)		(	1,350)
Impairment loss of intangible assets	(	2,595)		-
Other losses	(	1,310)	(	3,980)
	($	5,233)	($ 20,840)
Finance costs
	Years ended		December 31,
	2019		2018
Interest expense:
Bank borrowings	$	50,340	$	49,213
Convertible bonds		12,357		15,855
Long-term contract liabilities		5,663		5,103
Lease liability		47		-
Financial expense, others		9,937		11,895
	$	78,344	$	82,066

(26) Finance costs

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(27) Expenses by nature

Expenses by nature
Employee benefit expense Wages and salaries Employee stock options Labor and health insurance fees Pension costs Other personnel expenses Depreciation charge	Years ended December 31, 2019 2018 $ 218,900 $ 216,389 5,726 3,237 15,557 16,011 8,769 8,979 7,841 7,141 411,752 428,598 $ 668,545 $ 680,355
	2019 $ 218,900 5,726 15,557 8,769 7,841 411,752 $ 668,545

• A. In accordance with the Articles of Incorporation of the Company, a ratio of distributable profit of the current year (i.e. profit before tax less profit margin before the appropriation of employees’ compensation and directors’ and supervisors’ remuneration), after covering accumulated losses, shall be distributed as employees’ compensation and directors’ and supervisors’ remuneration. The ratio shall not be lower than 0.05% for employees’ compensation and shall not be higher than 5% for directors’ and supervisors’ remuneration. The aforementioned employees’ compensation and directors’ and supervisors’ remuneration requires the approval from the majority of the directors attending a board meeting, with more than two thirds of all directors in attendance, and must be reported to the shareholders. Employees’ compensation is distributed in the form of shares or cash, and the recipients may include employees of affiliates who meet certain conditions. The distribution plan is set by the Chairman.

• B. For the years ended December 31, 2019 and 2018, employees’ compensation was accrued at $195 and $140, respectively; directors’ and supervisors’ remuneration was both accrued at $5,600. The aforementioned amounts were recognised in salary expenses.

• Employees’ compensation of $140 and directors’ and supervisors’ remuneration of $5,600 for 2018 as resolved by the Board of Directors were in agreement with those amounts recognised in the 2018 financial statements.

Information about employees’ compensation and directors’ and supervisors’ remuneration of the Company as resolved at the meeting of Board of Directors and approved by shareholders at their meeting will be posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

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(28) Income tax

A. Income tax expense

• (a) Components of income tax expense:

ax me tax expense Components of income tax expense:
	Years	ended	December 31,
	2019		2018
Current tax:
Current tax on profits for the year	$ 103,716		$	72,996
Tax on undistributed surplus earnings		-		25,316
Prior year income tax overestimation	(	823)	(	367)
Total current tax	102,893			97,945
Deferred tax
Origination and reversal of temporary
differences	( 16,731)		(	44,136)
Impact of change in tax rate		-	(	3,469)
Income tax expense	$ 86,162		$	50,340

(b) Reconciliation between income tax expense and accounting profit:

	Years ended December 31,	Years ended December 31,	Years ended December 31,
	2019		2018
Income tax calculated based on profit
before tax and statutory tax rate	$ 193,929		$	149,994
Expenses disallowed by tax regulation		7,437		1,559
Tax exempt income by tax regulation	( 96,210)		(	67,345)
Temporary differences not recognised
as deferred tax assets		2,000		-
Taxable loss not recognised as deferred
tax assets		277		1,725
Change in assessment of realisation of
deferred tax assets	( 20,448)		(	57,073)
Prior year income tax overestimation	(	823)	(	367)
Tax on undistributed surplus earnings		-		25,316
Impact of change in the tax rate on
temporary differences between
current year and the year realised		-	(	3,469)
Income tax expense	$ 86,162		$	50,340

(c) The income tax (charge)/credit relating to components of other comprehensive income is as follows:

is as follows:
Currency translation differences (	Years ended December 31, 2019 2018 $ 8) ($ 2,150)
	2019 $ 8) (

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• B. Amounts of deferred tax assets or liabilities as a result of temporary differences and tax losses are as follows:

losses are as follows:
			2019
					Recognised
		Recognised			in other
		in profit		comprehensive
	January 1	or loss			income		December 31
- Deferred tax assets:
Temporary differences
Unrealised allowance for
inventory obsolescence	$ 10,327	$ 1,364		$		-	$ 11,691
Unrealised exchange loss	47	2,356				-	2,403
Warranty obligations	2,137	1,623				-	3,760
Long-term contract liabilities
interest expense	2,639	1,133				-	3,772
Others	2,835	( 1,668)				-	1,167
Income tax losses	50,313	11,645				-	61,958
	68,298	16,453				-	84,751
- Deferred tax liabilities:
Temporary differences
Land revaluation increment tax	( 39,395)	-				-	( 39,395)
Others	( 1,036)	278		(		8)	( 766)
	( 40,431)	278		(		8)	( 40,161)
	$ 27,867	$ 16,731		($		8)	$ 44,590
			2018
					Recognised
		Recognised			in other
		in profit		comprehensive
	January 1	or loss			income		December 31
- Deferred tax assets:
Temporary differences
Unrealised allowance for
inventory obsolescence	$ 9,525	$ 802		$		-	$ 10,327
Unrealised exchange loss	4,351	( 4,304)				-	47
Warranty obligations	1,657	480				-	2,137
Long-term contract liabilities
interest expense	-	2,639				-	2,639
Currency translation
differences	2,150	-		(	2,150)		-
Others	1,201	1,634				-	2,835
Income tax losses	3,659	46,654				-	50,313
	22,543	47,905		(	2,150)		68,298
- Deferred tax liabilities:
Temporary differences
Land revaluation increment tax	( 39,395)	-				-	( 39,395)
Others	( 736)	( 300)				-	( 1,036)
	( 40,131)	( 300)				-	( 40,431)
	($ 17,588)	$ 47,605		($	2,150)		$ 27,867

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• C. Expiration dates of unused tax losses and amounts of unrecognised deferred tax assets are as follows:

as follows:
	December 31, 2019			Expiry year 2022 2023 2024 2025 2026 2027 2028 2029 Expiry year 2022 2023 2024 2025 2026 2027 2028
Year incurred 2012 2013 2014 2015 2016 2017 2018 2019	Amount filed/assessed Unused amount $ 5,451 $ - 17,125 - 4,626 347 9,659 2,798 10,904 3,359 15,829 888 311,803 310,087 1,385 1,385 $ 376,782 $ 318,864 December 31, 2018		Unrecognised deferred tax assets $ - - 347 2,798 3,359 888 296 1,385 $ 9,073
Year incurred 2012 2013 2014 2015 2016 2017 2018	Amount filed/assessed $ 5,451 17,125 4,626 9,659 10,904 15,829 252,083 $ 315,677	Unused amount $ - - 347 2,798 6,139 888 252,083 $ 262,255	Unrecognised deferred tax assets $ - - 347 2,798 3,359 888 3,296 $ 10,688

• D. The amounts of deductible temporary differences that were not recognised as deferred tax assets are as follows:

Deductible temporary differences

December 31, 2019 $ 92,286	December 31, 2018 $ 83,505

• E. Income tax assessment of the Company and its domestic subsidiaries is as follows:

Recent assessment Tong-Lin Instruments Co., Ltd., Hua Lin Instruments Co., Ltd., Through 2018 E Century Healthcare Corporation, Hsing-Yeh Biotechnology Co., Ltd. and SenCare Healthcare Company

The Company, Chiu Ho Medical System Co., Ltd., Chiu Ho Through 2017 Scientific Co., Ltd., Tomorrow Medical System Co., Ltd., ShinHo Instruments Co., Ltd., Hsin Lin Biotech Co., Ltd., Chiu Ho Biotech Co., Ltd. and Medlink Healthcare Limited

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• F. Under the amendments to the Income Tax Act which was promulgated by the President of the Republic of China on February 7, 2018, the Company’s applicable income tax rate was raised from 17% to 20% effective from January 1, 2018. The Group has assessed the impact of the change in income tax rate.

(29) Earnings per share

Earnings per share
Basic earnings per share Profit attributable to ordinary shareholders of the parent Diluted earnings per share Profit attributable to ordinary shareholders of the parent Assumed conversion of all dilutive potential ordinary shares Employee stock options Employees’ compensation Convertible bonds Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares	Year	ended December 31, 2019 Weighted average number of ordinary shares outstanding Earnings per share (shares in thousands) (in dollars) 139,707 $ 2.83 139,707 401 6 29,769 169,883 $ 2.46
	Amount after tax $ 395,172 $ 395,172 - - 22,728 $ 417,900		Weighted average number of ordinary shares outstanding (shares in thousands) 139,707 139,707 401 6 29,769 169,883

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Basic earnings per share Profit attributable to ordinary shareholders of the parent Diluted earnings per share Profit attributable to ordinary shareholders of the parent Assumed conversion of all dilutive potential ordinary shares Employee stock options (Note) Employees’ compensation Convertible bonds Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares	Year	ended December 31, 2018 Weighted average number of ordinary shares outstanding Earnings per share (shares in thousands) (in dollars) 139,651 $ 2.32 139,651 - 5 34,679 174,335 $ 2.02	ended December 31, 2018 Weighted average number of ordinary shares outstanding Earnings per share (shares in thousands) (in dollars) 139,651 $ 2.32 139,651 - 5 34,679 174,335 $ 2.02
	Amount after tax $ 323,422 $ 323,422 - - 27,919 $ 351,341		Weighted average number of ordinary shares outstanding (shares in thousands) 139,651 139,651 - 5 34,679 174,335

Note: Not included due to antidilutive effect.

Because employees’ compensation may be distributed in the form of shares, the calculation of diluted earnings per share assumes that employees’ compensation would be distributed entirely in shares. These dilutive potential common shares are included in the weighted average number of outstanding shares when calculating diluted earnings per share. When calculating basic earnings per share, shares issued as part of employees’ compensation are included in the weighted average number of outstanding shares only if the number of such shares have been confirmed and resolved by the shareholders. Shares issued as part of employees’ compensation are not considered bonus shares, therefore no retrospective adjustment is applied when calculating basic and diluted earnings per share.

(30) Operating leases

Prior to 2019

• A. The Group leases property and machinery to others under operating lease agreements. Rents of $1,068,772 were recognised for these leases in profit or loss for the year ended December 31, 2018.

• B. The Group leases assets such as real estate and warehouses under operating lease agreements. The lease terms are from 2011 to 2027. For the year ended December 31, 2018, the Group

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recognised rental expense of $19,561. The future aggregate minimum lease payments under operating leases are as follows:

No later than one year Later than one year but not later than five years Later than five years	December 31, 2018 $ 12,025 24,811 6,183 $ 43,019

(31) Goodwill

• A. Goodwill is allocated as follows to the Group’s cash-generating units:

Hsing-Yeh Biotechnology Co., Ltd. Others	December 31, 2019 $ 150,617 8,534 $ 159,151	December 31, 2018 $ 150,617 11,129 $ 161,746

• B. Goodwill is allocated to the Group’s cash-generating units. The recoverable amount of all cash-generating units has been determined based on value-in-use calculations and fair value, net of disposed cost. These calculations use pre-tax cash flow projections based on financial budgets approved by the management covering a five-year period, and the details of evaluation on fair value are provided in Note 6(12).

• C. As the profit arising from certain cash-generating units was lower than management’s forecast, management has assessed that the recoverable amount of cash-generating units was lower than the carrying amount. Accordingly, the Group recognised impairment loss on goodwill amounting to $2,595 in 2019.

• D. Management determined budgeted gross margin based on past performance and their expectations of market development. The weighted average growth rates used are consistent with the projection included in industry reports. The discount rates used are pre-tax and reflect specific risks relating to the relevant operating segments. As of December 31, 2019 and 2018, the pre-tax discount rate applied on the Group’s major assessments is 5.48%~8.47% and 5.46%~9.07%, respectively.

(32) Supplemental cash flow information

• A. Information on investing activities with partial cash payments is provided in Notes 6(9) and (12).

• B. Information on financing activities with no cash flow effects is provided in Note 6(16).

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(33) Changes in liabilities from financing activities

					Guarantee	Total liabilities
	Short-term	Long-term	Lease		deposits	from financing
	borrowings	borrowings	liability		received	activities
January 1, 2019	$ 686,932	$ 2,995,204	$ 36,089		$ 19,535	$ 3,737,760
Changes in cash flow from
financing activities	( 215,396) ( 68,601) ( 6,799)				4,143	( 286,653)
Impact of changes in foreign
exchange rate	55 ( 3,234)			-	( 93)	( 3,272)
Changes in other non-cash
items	-	-	944		-	944
December 31, 2019	$ 471,591	$ 2,923,369	$ 30,234		$ 23,585	$ 3,448,779
					Guarantee	Total liabilities
	Short-term	Long-term	Lease		deposits	from financing
	borrowings	borrowings	liability		received	activities
January 1, 2018	$ 641,535	$ 2,889,415	$	-	$ 26,831	$ 3,557,781
Changes in cash flow from
financing activities	55,091	105,789		-	( 7,243)	153,637
Impact of changes in foreign
exchange rate	( 9,694)	-		-	( 53)	( 9,747)
December 31, 2018	$ 686,932	$ 2,995,204	$	-	$ 19,535	$ 3,701,671

7. RELATED PARTY TRANSACTIONS

(1) Parent and ultimate controlling party

The Company’s stocks are held by the public, so it has neither an ultimate parent company nor ultimate controlling party.

(2) Names of related parties and relationship

Names of related parties Relationship with the Group Yeezen General Hospital Substantive related party High-END VISION EYE CENTER Substantive related party Swissray Medical AG Substantive related party White Essence Substantive related party AESolution Biomedical Co., Ltd. Substantive related party J. Ab Beauty Co., Ltd. Substantive related party PT. NAVI Medical Indonesia Associate CHENG-HSIN Biotechnology Co., Ltd. Associate Associate

PT. NAVI Medical Indonesia CHENG-HSIN Biotechnology Co., Ltd. Dalian Neusoft Kangrui Jiuhe Medical Management Co., Ltd.

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(3) Significant transactions and balances with related parties

• A. Operating revenue

• (a) Sales revenue

nt transactions and balances with related ating revenue Sales revenue	parties
Sales of goods: Yeezen General Hospital Others	Years ended December 31, 2019 2018 $ 179,727 $ 177,209 1,932 2,654 $ 181,659 $ 179,863
	2019 $ 179,727 1,932 $ 181,659

In terms of the transactions between the subsidiary, Chiu Ho Scientific Co., Ltd., and the abovementioned related parties, goods are sold based on the price lists in force and terms that would be available to third parties. Hsing-Yeh Biotechnology Co., Ltd. and the abovementioned related parties have no other similar transactions that can be used for comparison. The collection period is approximately six months.

(b) Rental revenue

Rental revenue
Rental revenue: Others	Years ended December 31, 2019 2018 $ 85,398 $ 76,927
	2019 $ 85,398

• i. The subsidiary, Hsing-Yeh Biotechnology Co., Ltd. leases medical equipment and property to the abovementioned related parties. The lease terms are from 2019 to 2022. Lease payments are determined by negotiations between the two parties and are made monthly.

• ii. The subsidiaries, Chiu Ho Scientific Co., Ltd. and E Century Healthcare Corporation, lease medical equipment to the abovementioned related parties. The lease terms are from 2016 to 2031. The monthly lease payment is set as a predetermined percentage of the monthly revenue of the related party. The collection period is between 2 and 6 months.

B. Purchases

Purchases
Purchases of goods: Others	Years ended December 31, 2019 2018 $ 1,065 $ 706
	2019 $ 1,065

The subsidiaries, Chiu Ho Medical System Co., Ltd., Chiu Ho Scientific Co., Ltd., and Chiu Ho (CHINA) Medical Technology Co., Ltd., and the abovementioned related parties have no other similar transactions that can be used for comparison. The collection period is approximately three months.

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C. Notes and accounts receivable

(a)	Receivables from related parties:
		December 31, 2019	December 31, 2018
	Yeezen General Hospital	$ 212,608	$ 205,356
	Others	6,563	7,299
		219,171	212,655
	Less: Allowance for doubtful accounts	( 17)	( 15)
		$ 219,154	$ 212,640
(b)	The ageing analysis of accounts receivable due from related parties is as follows:
		December 31, 2019	December 31, 2018
	Not past due	$ 123,932	$ 134,669
	Past due
	Up to 1 month	16,823	16,894
	Up to 2 months	21,235	16,234
	Up to 3 months	22,927	16,591
	Up to 4 months	7,557	13,569
	Up to 5 months	26,697	14,698
	Up to 6 months	-	-
	Over 6 months	-	-
		$ 219,171	$ 212,655

(c) As of December 31, 2019, December 31, 2018 and January 1, 2018, the balances of receivables due from related parties from contracts with customers amounted to $197,777, $196,375, and $186,237, respectively.

• (d) Lease payments receivable (shown as ‘accounts receivable - related parties’ and longterm notes and accounts receivable - related parties)

The subsidiaries, Hsing-Yeh Biotechnology Co., Ltd., Chiu Ho Scientific Co., Ltd., and E Century Healthcare Corporation, lease machinery and other equipment to Yeezen General Hospital under a finance lease. The lease terms are from 2015 to 2024. Based on the terms of the lease contract, the ownership of the equipment shall be transferred to the lessee when the lease expires. In addition, Hsing-Yeh Biotechnology Co., Ltd. leases renovation project assets to CHENG-HSIN Biotechnology Co., Ltd under a finance lease. The lease term is from 2017 to 2024 which is for the major part of economic life of the underlying asset. The lease payments from the aforementioned agreements are expected to be collected on schedule.

Effective 2019

As of December 31, 2019, reconciliation of the undiscounted lease payments and the net investment in the finance lease is provided as follows:

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Current Yeezen General Hospital CHENG-HSIN Biotechnology Co., Ltd. Loss allowance ( Non-current Yeezen General Hospital CHENG-HSIN Biotechnology Co., Ltd. Loss allowance (	December 31, 2019	Net investment in the lease $ 16,680 8,025 1) $ 24,704 $ 17,411 31,955 2) $ 49,364
	Undiscounted lease Unearned finance payments income $ 17,536 ($ 856) 8,939 ( 914) 1) - ( $ 26,474 ($ 1,770) $ 18,304 ($ 893) 33,523 ( 1,568) 2) - ( $ 51,825 ($ 2,461)

Prior to 2019

The gross investments in those leases and present value of total minimum lease payments receivable as at December 31, 2018 were as follows:

D.

December 31, 2018 Total lease payments Unearned finance Net lease payments receivable income receivable Current Yeezen General Hospital $ 19,452 ($ 1,038) $ 18,414 CHENG-HSIN Biotechnology Co., Ltd. 10,332 ( 1,347) 8,985 Loss allowance ( 1) - ( 1) $ 29,783 ($ 2,385) $ 27,398 Non-current Yeezen General Hospital $ 23,447 ($ 689) $ 22,758 CHENG-HSIN Biotechnology Co., Ltd. 49,077 ( 3,010) 46,067 Loss allowance ( 3) - ( 3) $ 72,521 ($ 3,699) $ 68,822 (e) Information relating to credit risk is provided in Note 12(2). Other receivables due from related parties Loans to related parties December 31, 2019 December 31, 2018 Yeezen General Hospital $ 174,000 $ 148,000 High-END VISION EYE CENTER 4,500 5,000 $ 178,500 $ 153,000

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Interest income

Interest income
Yeezen General Hospital High-END VISION EYE CENTER Others	Years ended December 31, 2019 2018 $ 3,920 $ 3,139 115 125 - 5 $ 4,035 $ 3,269
	2019 $ 3,920 115 - $ 4,035

For the years ended December 31, 2019 and 2018, the loans carried an interest rate of 2.5% per annum.

E. Accounts payable - related parties

SRM

December 31, 2019 $ 136	December 31, 2018 $ 4,562

The payables to related parties arise mainly from purchases which are due within three months. The payables bear no interest.

F. Refund liabilities (shown as ‘other current liabilities’)

Yeezen General Hospital	December 31, 2019 $ 14,686	December 31, 2018 $ 6,667

Sales discounts are granted based on mutual agreement, and no other similar transaction can be compared with.

(4) Key management compensation

Key management compensation
Salaries and other short-term employee benefits Post-employment benefits Share-based payments	Years ended December 31, 2019 2018 $ 32,001 $ 31,696 216 279 607 343 $ 32,824 $ 32,318
	2019 $ 32,001 216 607 $ 32,824

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8. PLEDGED ASSETS

The Group’s assets pledged as collateral are as follows:

Book value Asssets December 31, 2019 December 31, 2018 Notes receivable $- $ 4,290 Long-term notes receivable - 7,590 Time deposits (shown as ‘other current assets’) 50,098 - Reserve account (shown as ‘other financial assets - non-current’) 21,916 21,480 Time deposits (shown as ‘other financial assets - non-current’) - 55,053 Property, plant and equipment (including investment property) Land 1,664,226 1,664,226 Buildings and structures 373,906 370,089 Leased assets - machinery and equipment 469,970 416,323 2,508,102 2,450,638 $ 2,580,116 $ 2,539,051

Purpose Collateral for long-term borrowings Collateral for long-term borrowings Performance guarantee Collateral for long-term borrowings Performance guarantee Collateral for short-term and long-term borrowings Collateral for short-term and long-term borrowings Collateral for long-term borrowings

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNISED CONTRACT COMMITMENTS

(1) Contingencies

None.

(2) Commitments

• A. Please refer to Notes 6(16) and 6(17) for commitments related to the second and the third domestic issuances of secured convertible corporate bonds and the syndicated bank loan.

• B. As of December 31, 2019 and 2018, capital expenditures on property, plant and equipment contracted for but not yet incurred was $1,197,559 and $1,586,518, respectively.

• C. As of December 31, 2019 and 2018, amounts available under unused letters of credit were $178,794 and $235,414, respectively.

• D. Operating lease agreements:

Please refer to Note 6(30) for details.

10. SIGNIFICANT DISASTER LOSS

None.

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11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE

None.

12. OTHERS

(1) Capital management

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

(2) Financial instruments

A. Financial instruments by category

Financial assets Financial assets at fair value through profit or loss Financial assets mandatorily measured at fair value through profit or loss Financial assets at fair value through other comprehensive income Designation of equity instrument Financial assets at amortised cost Cash and cash equivalents Financial assets at amortised cost Notes receivable (including related parties) Accounts receivable (including related parties) Other receivables (including related parties) Other financial assets Long-term notes and accounts receivable (including related parties)	December 31, 2019 $ 71,369 $ 38,681 $ 1,245,235 71,369 56,562 751,472 180,017 525,026 223,404 $ 3,053,085	December 31, 2018 $ 53,974 $ 47,231 $ 1,209,636 - 44,838 741,820 153,574 533,968 186,500 $ 2,870,336

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Financial liabilities Financial liabilities at amortised cost Short-term borrowings Notes payable Accounts payable (including related parties) Other payables (including related parties) Bonds payable (including current portion) Long-term borrowings (including current portion) Other financial liabilities Lease liability	December 31, 2019 $ 471,591 3,495 219,949 168,781 1,159,471 2,923,369 23,920 $ 4,970,576 $ 30,234	December 31, 2018 $ 686,932 4,346 209,513 149,934 1,177,035 2,995,204 21,210 $ 5,244,174 $-

• B. Financial risk management policies

• (a) The Group’s operating activities expose it to a variety of financial risks, including market risk (including foreign exchange risk, interest rate risk and price risk), credit risk and liquidity risk. The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial position and financial performance.

• (b) Risk management is carried out by a central treasury department (Group treasury) under policies approved by the Board of Directors. Group treasury identifies, evaluates and hedges financial risks in close cooperation with the Group’s operating units. The Board provides written principles for overall risk management, as well as written policies covering specific areas and matters, such as credit risk.

• C. Significant financial risks and degrees of financial risks

• (a) Market risk

Foreign exchange risk

• i. The Group conducts business worldwide and imports state-of-the-art medical equipment and supplies from various countries and is therefore exposed to foreign exchange rate risk from multiple foreign currencies, primarily the US dollar. Foreign exchange rate risk arises from future commercial transactions, recognised assets and liabilities and net investments in foreign operations.

• ii. Under the Group’s financial risk management policy, foreign exchange risk is managed using debt denominated in the relevant foreign currency.

• iii. The Group’s businesses involve some non-functional currency operations (the Company’s and certain subsidiaries’ functional currency: NTD; other certain subsidiaries’ functional currency: RMB, HKD or IDR). The information on assets

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and liabilities denominated in foreign currencies whose values would be materially affected by the exchange rate fluctuations is as follows:

(Foreign currency: functional currency) Financial assets Monetary items USD:NTD EUR:NTD SGD:NTD USD:RMB Financial liabilities Monetary items USD:NTD EUR:NTD SGD:NTD (Foreign currency: functional currency) Financial assets Monetary items USD:NTD EUR:NTD USD:RMB USD:HKD Financial liabilities Monetary items USD:NTD EUR:NTD SGD:NTD	December 31, 2019 Foreign currency amount Exchange Book value (in thousands) rate (NTD) $ 8,902 29.98 $ 266,882 22 33.59 739 8 22.28 178 148 6.96 4,437 2,790 29.98 83,644 879 33.59 29,526 351 22.28 7,820 December 31, 2018 Foreign currency amount Exchange Book value (in thousands) rate (NTD) $ 8,856 30.72 $ 272,056 22 35.20 774 1,327 6.87 40,765 1,302 7.83 39,997 5,068 30.72 155,689 263 35.20 9,258 765 22.48 17,197	December 31, 2019 Foreign currency amount Exchange Book value (in thousands) rate (NTD) $ 8,902 29.98 $ 266,882 22 33.59 739 8 22.28 178 148 6.96 4,437 2,790 29.98 83,644 879 33.59 29,526 351 22.28 7,820 December 31, 2018 Foreign currency amount Exchange Book value (in thousands) rate (NTD) $ 8,856 30.72 $ 272,056 22 35.20 774 1,327 6.87 40,765 1,302 7.83 39,997 5,068 30.72 155,689 263 35.20 9,258 765 22.48 17,197	Year ended December 31, 2019 Sensitivity analysis Effect on Extent of profit variation or loss 1% $ 2,669 1% 7 1% 2 1% 44 1% 836 1% 295 1% 78 Year ended December 31, 2018 Sensitivity analysis Effect on Extent of profit variation or loss 1% $ 2,721 1% 8 1% 408 1% 400 1% 1,557 1% 93 1% 172
	Foreign currency amount (in thousands) $ 8,856 22 1,327 1,302 5,068 263 765	Exchange rate 30.72 35.20 6.87 7.83 30.72 35.20 22.48
			Extent of variation 1% 1% 1% 1% 1% 1% 1%

• iv. The total exchange gain (loss), including realised and unrealised arising from significant foreign exchange variation on the monetary items held by the Group for the years ended December 31, 2019 and 2018, amounted to ($5,732) and $6,147, respectively

Price risk

• i. The Group is exposed to equity price risk from its investments classified on the consolidated balance sheet either as financial assets measured at fair value through profit or loss and financial assets measured at fair value through other

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comprehensive income. The Group is not exposed to commodity price risk. To manage its price risk arising from investments in equity securities, the Group has set stop-loss points and therefore does not expect to incur significant losses from equity price risk.

• ii. The Group’s investments in equity securities comprise domestic and foreign listed and unlisted stocks. The prices of equity securities would change due to the change of the future value of investee companies. If the prices of these equity securities had increased/decreased by 10% with all other variables held constant, post-tax profit for the years ended December 31, 2019 and 2018 would have increased/decreased by $7,137 and $5,348, respectively, as a result of gains/losses on equity securities classified as at fair value through profit or loss. Other components of equity would have increased/decreased by $3,868 and $4,723, respectively, as a result of other comprehensive income classified as equity investment at fair value through other comprehensive income.

Cash flow and fair value interest rate risk

• i. The Group’s interest rate risk arises from long-term borrowings. Long-term borrowings issued at variable rates expose the Group to cash flow interest rate risk, which is partially offset by cash and cash equivalents held at variable rates. The Group’s borrowings at variable rates are primarily denominated in NTD and USD.

• ii. If the borrowing interest rate had increased/decreased by 1% with all other variables held constant, profit, net of tax for the years ended December 31, 2019 and 2018 would have decreased/increased by $29,234 and $29,952, respectively. The main factor is that changes in interest expense result from floating rate borrowings.

• (b) Credit risk

• i. Credit risk refers to the risk of financial loss to the Group arising from default by the clients on the contract obligations. The main factor is the counterparties could not repay in full the accounts receivable based on the agreed terms. According to the Group’s credit policy, each local entity in the Group is responsible for managing and assessing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. Internal risk control assesses the credit quality of the customers, taking into account their financial position, past experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the credit control supervisor. The utilization of credit limits is regularly monitored.

• ii. If the contract payments were past due over one month based on the terms, there has been a significant increase in credit risk on that instrument since initial recognition; the default occurs when the contract payments are past due over three

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months and up to six months.

• iii. The Group classifies customer’s accounts receivable and contract assets in accordance with customer types. The Group applies the modified approach using provision matrix to estimate expected credit loss under the provision matrix basis.

• iv. The Group wrote-off the financial assets, which cannot be reasonably expected to be recovered, after initiating recourse procedures. However, the Group will continue executing the recourse procedures to secure their rights.

• v. The Group took into consideration the forecastability to adjust historical and timely information to assess the default possibility of accounts receivable and contract assets. On December 31, 2019 and 2018, the provision matrix is as follows:

December 31, 2019 Not past due Up to 1 month Up to 2 months Up to 3 months Up to 4 months Up to 5 months Up to 6 months Over 6 months (Note) December 31, 2018 Not past due Up to 1 month Up to 2 months Up to 3 months Up to 4 months Up to 5 months Up to 6 months Over 6 months	Expected loss rate 0.00%~0.26% 0.00%~3.70% 0.00%~6.72% 0.00%~12.22% 0.00%~100% 0.00%~100% 0.00%~100% 100% Expected loss rate 0.00%~0.26% 0.00%~3.70% 0.00%~6.72% 0.00%~12.22% 0.00%~100% 0.00%~100% 0.00%~100% 100%	Total book value $ 990,551 27,629 22,196 23,073 7,793 28,714 - 14,536 $ 1,114,492 Total book value $ 920,074 23,197 22,315 21,139 14,569 14,698 - 19,379 $ 1,035,371	Loss allowance $ 509 114 1 - 2 763 - 763 $ 2,152 Loss allowance $ 359 149 271 492 604 - - 19,379 $ 21,254

Note: As of December 31, 2019, accounts past due over 6 months amounting to $13,773 were collected after the balance sheet date, therefore, the Group reversed the written-off accounts and loss allowance.

vi. Movements in relation to the Group applying the simplified approach to provide loss allowance for accounts receivable, contract assets, long-term and short-term lease payments receivable are as follows:

~74~

Accounts receivable (including related parties) At January 1 $ 21,222 Provision for impairment 72 Reversal of impairment ( 19,149) Write-offs - Effect of foreign exchange ( 34) At December 31 $ 2,111		2019
		Contract assets (including related parties) $ 28 3 - - - $ 31

Accounts receivable (including related parties) At January 1_IAS 39 $ 58,059 Adjustments under new standards 17,564 At January 1_IFRS 9 75,623 Provision for impairment 13,483 Reversal of impairment ( 61,365) Write-offs ( 6,281) Effect of foreign exchange ( 238) At December 31 $ 21,222		2018

(c) Liquidity risk

• i. Cash flow forecasting is performed in the operating entities of the Group and aggregated by Group treasury. Group treasury monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs. Such forecasting takes into consideration the Group’s debt financing plans, covenant compliance, compliance with internal balance sheet ratio targets.

• ii. The table below analyses the Group’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the expected or contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

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Non-derivative financial liabilities:

December 31, 2019 Short-term borrowings Notes payable and long- term notes payable (shown as ‘other non- current liabilities’) Accounts payable (including related parties) Other payables (including related parties) Lease liability Bonds payable and embedded derivative instruments Long-term borrowings (including current portion) December 31, 2018 Short-term borrowings Notes payable and long- term notes payable (shown as ‘other non- current liabilities’) Accounts payable (including related parties) Other payables Bonds payable and embedded derivative instruments Long-term borrowings (including current portion)	Less than 1 year $ 474,369 3,495 219,949 167,030 8,829 1,159,471 874,656 Less than 1 year $ 693,648 4,346 209,513 147,760 - 238,617	Between 1 and 2 years $ - 335 - - 6,275 - 312,632 Between 1 and 2 years $ - 1,340 - - 1,177,035 827,246	Between 2 and 5 years $ - - - - 16,499 - 1,868,345 Between 2 and 5 years $ - 335 - - - 2,106,231	Over 5 years $ - - - - 1,364 - - Over 5 years $ - - - - - 14,019

(3) Fair value information

• A. The different levels that the inputs to valuation techniques are used to measure fair value of financial and non-financial instruments have been defined as follows:

• Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. A market is regarded as active where a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. The fair value of the Group’s investment in listed stocks is included in Level 1.

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• Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

• Level 3: Unobservable inputs for the asset or liability. The fair value of the Group’s investment in equity investment without active market is included in Level 3.

• B. Fair value information of investment property at cost is provided in Note 6(12).

• C. The carrying amount of a financial instrument not measured at fair value is a reasonable approximation of its fair value. Such financial instruments include cash and cash equivalents, financial assets at amortised cost, contract assets (including those from related parties), notes receivable, accounts receivable (including those from relaed parties), other receivables (including those from related parties), guarantee deposits paid, long-term notes and accounts receivable (including those from related parties), other financial assets, short-term borrowings, contract liabilities, notes payable, accounts payable (including those to related parties), other payables, long-term notes payable, long-term borrowings (including the portion due within one year or one business cycle) and bonds payable.

• D. The related information of financial and non-financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets and liabilities are as follows:

• (a) The related information of the nature of the assets and liabilities is as follows:

December 31, 2019 Assets Recurring fair value measurements Financial assets at fair value through profit or loss Equity securities Derivative instruments Financial assets at fair value through other comprehensive income Equity securities	Level 1 $ 71,299 - 7,356 $ 78,655	Level 2 $ - - - $-	Level 3 $ - 70 31,325 $ 31,395	Total $ 71,299 70 38,681 $110,050

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December 31, 2018 Assets Recurring fair value measurements Financial assets at fair value through profit or loss Equity securities Derivative instruments Financial assets at fair value through other comprehensive income Equity securities	Level 1 $ 53,482 - 14,394 $ 67,876	Level 2 $ - - - $-	Level 3 $ - 492 32,837 $ 33,329	Total $ 53,482 492 47,231 $101,205

• (b) The methods and assumptions the Group used to measure fair value are as follows:

  • i. Listed stocks are instruments whose fair values are measured using quoted market prices (that is, Level 1). The quoted market prices used for these stocks are the closing prices on the balance sheet date.

  • ii. Except for financial instruments with active markets, the fair value of other financial instruments is measured by using valuation techniques or by reference to counterparty quotes.

• E. For the years ended December 31, 2019 and 2018, there was no transfer between Level 1 and Level 2.

• F. The following chart is the movement of Level 3 for the years ended December 31, 2019 and 2018.

2018.
		2019
		Derivative financial
	Equity securities	instruments	Total
At January 1	$ 32,837	$ 492	$ 33,329
Gains and losses
recognised in profit
or loss	-	( 422)	( 422)
Gains and losses
recognised in other
comprehensive income	( 1,512)	-	( 1,512)
At December 31	$ 31,325	$ 70	$ 31,395

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		2018
		Derivative financial
	Equity securities	instruments	Total
At January 1	$ 26,947	$ 660	$ 27,607
Gains and losses
recognised in profit
or loss	-	( 168)	( 168)
Gains and losses
recognised in other
comprehensive income	5,890	-	5,890
At December 31	$ 32,837	$ 492	$ 33,329

• G. For the years ended December 31, 2019 and 2018, there was no transfer into or out from Level 3.

• H. Financial accounting department is in charge of valuation procedures for fair value measurements being categorised within Level 3, which is to verify independent fair value of financial instruments. Such assessment is to ensure the valuation results are reasonable by applying independent information to make results close to current market conditions and performing reviews regularly.

• I. The following is the qualitative information of significant unobservable inputs and sensitivity analysis of changes in significant unobservable inputs to valuation model used in Level 3 fair value measurement:

Fair value at December 31, 2019 Non-derivative equity instrument: AESolution Biomedical Co., Ltd. $ 31,325 Huede Healthtech Co., Ltd. - Hybrid instrument: Convertible bond 70	Valuation technique Market comparable companies Net asset value Binomial Model	Significant unobservable input Price to book ratio multiple Discount for lack of marketability Not applicable Volatility Discount rate	Range (weighted average) 4.82 30.55% 25.71% 0.7383%	Relationship of inputs to fair value The higher the multiple, the higher the fair value The higher the discount for lack of marketability, the lower the fair value Not applicable The higher the volatility, the higher the fair value; The higher the discount rate, the lower the fair value

~79~

Fair value at December 31, 2018 Non-derivative equity instrument: AESolution Biomedical Co., Ltd. $ 32,163 Huede Healthtech Co., Ltd. 674 Hybrid instrument: Convertible bond 492	Valuation technique Market comparable companies Net asset value Binomial Model	Significant unobservable input Price to book ratio multiple Discount for lack of marketability Not applicable Volatility Discount rate	Range (weighted average) 5.55 30% 23.27% 0.7839%	Relationship of inputs to fair value The higher the multiple, the higher the fair value The higher the discount for lack of marketability, the lower the fair value Not applicable The higher the volatility, the higher the fair value; The higher the discount rate, the lower the fair value

• J. The Group has carefully assessed the valuation models and assumptions used to measure fair value. However, use of different valuation models or assumptions may result in different measurement. For financial assets and financial liabilities classified as Level 3, an increase or decrease in their valuation parameter by 1% would have no material impact on gain or loss and other comprehensive income as at December 31, 2019 and 2018.

13. SUPPLEMENTARY DISCLOSURES

(1) Significant transactions information

(The following intercompany transactions between the Company and its subsidiaries or between two subsidiaries were eliminated when preparing the consolidated financial statements.)

• A. Loans to others: Please refer to table 1.

• B. Provision of endorsements and guarantees to others: Please refer to table 2.

• C. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures): Please refer to table 3.

• D. Acquisition or sale of the same security with the accumulated cost reaching $300 million or 20% of paid-in capital or more: None.

• E. Acquisition of real estate reaching $300 million or 20% of paid-in capital or more: None.

• F. Disposal of real estate reaching $300 million or 20% of paid-in capital or more: None.

• G. Purchases or sales of goods from or to related parties reaching $100 million or 20% of paidin capital or more: Please refer to table 4.

• H. Receivables from related parties reaching $100 million or 20% of paid-in capital or more: Please refer to table 5.

• I. Trading in derivative instruments undertaken during the reporting periods: Please refer to Notes 6(2) (16) and 12(3).

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• J. Significant inter-company transactions during the reporting periods: None exceeds 100 million.

(2) Information on investees

(The following intercompany transactions between the Company and its subsidaires or between two subsidiaries were eliminated when preparing the consolidated financial statements.)

Names, locations and other information of investee companies (not including investees in Mainland China) ： Please refer to table 6.

(3) Information on investments in Mainland China

• (The following intercompany transactions between the Company and its subsidaires or between two subsidiaries were eliminated when preparing the consolidated financial statements.)

• A. Basic information: Please refer to table 7.

• B. Limits on investments in Mainland China: Please refer to table 7.

• C. Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area: None exceeds 100 million.

14. SEGMENT INFORMATION

(1) General information

The Group operates business only in a single industry. The chief operating decision-maker, who allocates resources and assesses performance of the Group as a whole, has identified that the Group has only one reportable operating segment. The chief operating decision-maker assesses performance based on net profits, and the amounts of assets, liabilities, profits and losses provided to the decision-maker are consistent with those presented in the financial statements. Under one reportable segment, information on profits, losses, assets and liabilities of individual departments are not disclosed.

(2) Measurement of segment information

The chief operating decision-maker assesses performance based on net profits, and the amounts of assets, liabilities, profits and losses provided to the decision-maker are consistent with those presented in the financial statements. Under one reportable segment, information on profits, losses, assets and liabilities of individual departments are not disclosed.

(3) Information on products and services

Because the Company and its subsidiaries are all engaged in sales of drugs and sales, rent and installment and maintenance of medical devices, information on products and services is the same with the financial information provided in Note 6 (23).

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(4) Geographical information

Geographical information for the years ended December 31, 2019 and 2018 is as follows:

Years ended December 31,

Taiwan China Others	2019	2019	2018 Revenue (Note) Non-current assets $ 2,319,272 $ 6,835,852 181,575 138,825 6,619 - $ 2,507,466 $ 6,974,677
	Revenue (Note) $ 2,742,853 196,993 10,206 $ 2,950,052	Non-current assets $ 6,912,999 125,378 -	Revenue (Note) $ 2,319,272 181,575 6,619 $ 2,507,466
		$ 7,038,377

Note: Revenue was reclassified based on the country where the customers are located.

(5) Major customer information

Major customer information
Yeezen General Hospital	Years ended December 31, 2019 2018 Revenue Revenue $ 260,547 $ 250,512
	2019 Revenue $ 260,547

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Table 1

CHC Healthcare Group and Subsidiaries

Loans to others

For the year ended December 31, 2019

Expressed in thousands of NTD (Except as otherwise indicated)

No. (Note 1)	Creditor	Borrower	General ledger account	Is a related party	Maximum outstanding balance during the year ended December 31, 2019	Balance at December 31, 2019	Actual amount drawn down	Interest rate	Nature of loan	Amount of transactions with the borrower	Reason for short-term financing	Allowance for doubtful accounts	Collateral	Collateral	Limit on loans granted to a single party (Note 2)	Ceiling on total loans granted (Note 3)	Footnote
													Item	Value
0 0 0 0 0 0 0 0 0 0 1 2 4	The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company Chiu Ho Scientific Co., Ltd. Hsing-Yeh Biotechnology Co., Ltd. CHC Healthcare (HK) Limited	Chiu Ho Medical System Co., Ltd. Chiu Ho Scientific Co., Ltd. Tong-Lin Instruments Co., Ltd. Hua Lin Instruments Co., Ltd. E Century Healthcare Corporation Tomorrow Medical System Co., Ltd. Chiu Ho Biotech Co., Ltd. Medlink Healthcare Limited Hsing-Yeh Biotechnology Co., Ltd. Chiu Ho (CHINA) Medical Technology Co., Ltd. High-End Vision Eye Center Yeezen General Hospital Chiu Ho (CHINA) Medical Technology Co., Ltd.	Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables	Y Y Y Y Y Y Y Y Y Y Y Y Y	480,000 $ 100,000 60,000 15,000 20,000 490,000 10,000 100,000 80,000 31,600 5,000 177,000 7,900	130,000 $ 80,000 - - - 390,000 - 50,000 50,000 - 4,500 174,000 - 878,500 $	- $ 30,000 - - - 190,000 - 31,000 35,000 - 4,500 174,000 -	2% 2% 2% 2% 2% 2% 2% 2% 2% 2% 2.5% 2.5% 2%	Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing Business transaction Business transaction Short-term financing	- $ - - - - - - - - - 5,760 225,403 -	Operation Operation Operation Operation Operation Operation Operation Operation Operation Operation - - Operation	- $ - - - - - - - - - - - -	None None None None None None None None None None None None None	- $ - - - - - - - - - - - -	516,214 $ 516,214 516,214 516,214 516,214 516,214 516,214 516,214 516,214 516,214 5,760 200,533 7,944	2,064,857 $ 2,064,857 2,064,857 2,064,857 2,064,857 2,064,857 2,064,857 2,064,857 2,064,857 2,064,857 57,181 401,067 15,889
							464,500 $

Table 1, Page 1

Note 1: The numbers filled in for the loans provided by the Company or subsidiaries are as follows:

• (1) The Company is ‘0’.

• (2) The subsidiaries are numbered in order starting from ‘1’.

Note 2: (1) In accordance with the Company's lending policies and procedures, the credit limit for each type of borrower is set as follows:

• A. For borrowers with which the Company has a business relationship, the individual loan amount cannot exceed the total transaction amount with the Company in the most recent year.

• B. For borrowers with short-term financing needs, the individual loan amount cannot exceend 10% of the Company's net assets according to the most recent financial statements.

• (2) In accordance with the lending policies and procedures of the Company's subsidiary, the credit limit for each type of borrower is set as follows:

• A. For borrowers with which the subsidiary has a business relationship, the individual loan amount cannot exceed the total transaction amount with the subsidiary in the most recent year.

• B. The total loan amount granted to a single party cannot exceed 20% of the subsidiary's net assets according to the most recent financial statements.

• Note 3: (1) Limit on total loans granted by the Company: Total loan amount cannot exceed 40% of the Company's net assets according to the most recent financial statements.

• (2) Limit on total loans granted by the Company's subsidiary: Total loan amount cannot exceed 40% of the subsidiary's net assets according to the most recent financial statements.

Table 1, Page 2

CHC Healthcare Group and Subsidiaries

Table 2

Expressed in thousands of NTD (Except as otherwise indicated)

Provision of endorsements and guarantees to others

For the year ended December 31, 2019

No. （Note1）	Endorser/ guarantor	Party being endorsed/guaranteed	Party being endorsed/guaranteed	Limit on endorsements/ guarantees provided for a single party （Note 3）	Maximum outstanding endorsement/ guarantee amount as of December31,2019	Outstanding endorsement/ guarantee amount at December31,2019	Actual amount drawndown	Amount of endorsements/ guarantees secured with collateral	Ratio of accumulated endorsement/ guarantee amount to net asset value of the endorser/ guarantor company	Ceiling on total amount of endorsements/ guarantees provided （Note4）	Provision of endorsements/ guarantees by parent company to subsidiary （Note 5）	Provision of endorsements/ guarantees by subsidiary to parent company （Note 5）	Provision of endorsements/ guarantees to the party in Mainland China （Note 5）	Footnote
		Companyname	Relationship with the endorser/ guarantor （Note2）
0 0 0 0 0 0 1 1 2	The Company The Company The Company The Company The Company The Company Hsing-Yeh Biotechnology Co., Ltd. Hsing-Yeh Biotechnology Co., Ltd. Chiu Ho (CHINA) Medical Technology Co., Ltd.	Chiu Ho Medical System Co., Ltd. Tomorrow Medical System Co., Ltd. Chiu Ho Scientific Co., Ltd. E Century Healthcare Corporation Guangzhou Chiuho Medical System Co., Ltd. Medlink Healthcare Limited The Company Tomorrow Medical System Co., Ltd. Guangzhou Chiuho Medical System Co., Ltd.	2 2 2 2 2 2 3 4 4	10,324,288 $ 10,324,288 10,324,288 10,324,288 10,324,288 10,324,288 2,005,335 2,005,335 250,319	1,922,000 $ 1,520,000 335,905 57,000 101,354 50,000 828,236 575,164 43,500	1,792,000 $ 1,520,000 294,980 57,000 - - 828,236 575,164 43,050 5,110,430 $	434,950 $ 682,550 31,051 28,037 - - 828,236 299,085 - 2,303,909 $	- $ - - - - - 828,236 575,164 -	34.71% 29.45% 5.71% 1.10% 0.00% 0.00% 82.60% 57.36% 34.40%	15,486,432 $ 15,486,432 15,486,432 15,486,432 15,486,432 15,486,432 3,008,002 3,008,002 375,478 $	Y Y Y Y Y Y N N N	N N N N N N Y N N	N N N N Y N N N Y
								1,403,400 $

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

(1) The Company is ‘0’.

(2) The subsidiaries are numbered in order starting from ‘1’.

Table 2, Page 1

Note 2: Relationship between the endorser/guarantor and the party being endorsed/guaranteed is classified into the following seven categories; fill in the number of category each case belongs to:

• (1) Having business relationship.

• (2) The endorser/guarantor parent company owns directly and indirectly more than 50% voting shares of the endorsed/guaranteed subsidiary.

• (3) The endorsed/guaranteed company owns directly and indirectly more than 50% voting shares of the endorser/guarantor parent company.

• (4) The endorser/guarantor parent company owns directly and indirectly more than 90% voting shares of the endorsed/guaranteed company.

• (5) Mutual guarantee of the trade made by the endorsed/guaranteed company or joint contractor as required under the construction contract.

• (6) Due to joint venture, all shareholders provide endorsements/guarantees to the endorsed/guaranteed company in proportion to its ownership.

• (7) Joint guarantee of the performance guarantee for pre-sold home sales contract as required under the Consumer Protection Act.

• Note 3: (1) In accordance with the Company's policies and procedures on endorsements and guarantees, the endorsement or guarantee amount for a single party cannot exceed 200% of the Company's net assets according to the most recent financial statements.

• (2) In accordance with the policies and procedures on endorsements and guarantees provided by the Company's subsidiary, the endorsement or guarantee amount for a single party cannot exceed 200% of the subsidiary's net assets according to the most recent financial statements.

• (3) In accordance with the Company's policies and procedures on endorsements and guarantees, the total endorsement or guarantee amount for a single party provided by the Company and its subsidiaries cannot exceed 200% of the Company's net assets according to the most recent financial statements.

• Note 4: (1) In accordance with the Company's policies and procedures on endorsements and guarantees, the total endorsement and guarantee amount provided to external parties cannot exceed 300% of the Company's net assets according to the most recent financial statemetns.

• (2) In accordance with policies and procedures on endorsements and guarantees provided by Company's subsidiary, the total endorsement and guarantee amount provided to external partines cannot exceed 300% of the subsidiary's net assets according to the most recent financial statements.

• (3) In accordance with the Company's policies and procedures on endorsements and guarantees, the total endorsement and guarantee amount provided to external parties by the Company and its subsidiaries cannot exceed 300% of the net assets of the Company according to the most recent financial statements.

Note 5: Fill in ‘Y’ for those cases of provision of endorsements/guarantees by listed parent company to subsidiary and provision by subsidiary to listed parent company, and provision to the party in Mainland China.

Table 2, Page 2

CHC Healthcare Group and Subsidiaries

Table 3

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

December 31, 2019

Expressed in thousands of NTD

(Except as otherwise indicated)

Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account		As of December 31,2019	As of December 31,2019		Footnote
				Number of shares	Book value	Ownership (%)	Fair value
The Company The Company Chiu Ho Medical System Co., Ltd. Chiu Ho Medical System Co., Ltd.	Stocks–China Isotope & Radiation Corporation Stocks–Swissray Global Healthcare Holding Ltd. Stocks–Huede Healthtech Co., Ltd. Stocks–AESolution Biomedical Co., Ltd.	- The Company's chairman and the investee's chairman are the same person - The Company's chairman and the investee's chairman are the same person	Financial asset at fair value through profit or loss-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current	880,000 1,988,100 200,000 855,400	71,299 $ 7,356 - 31,325	1.10% 4.67% 6.50% 6.69%	71,299 $ 7,356 - 31,325

Table 3, Page 1

CHC Healthcare Group and Subsidiaries

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

For the year ended December 31, 2019

Table 4 Purchaser/seller	Counterparty	Relationship with the counterparty		Transaction	Transaction		Differences in transaction terms compared to third partytransactions	Differences in transaction terms compared to third partytransactions	Percentage of total notes/accounts Footnote Balance receivable(payable) （Note 2） Notes/accounts receivable(payable) Expressed in thousands of NTD (Except as otherwise indicated)	Percentage of total notes/accounts Footnote Balance receivable(payable) （Note 2） Notes/accounts receivable(payable) Expressed in thousands of NTD (Except as otherwise indicated)	Percentage of total notes/accounts Footnote Balance receivable(payable) （Note 2） Notes/accounts receivable(payable) Expressed in thousands of NTD (Except as otherwise indicated)
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unitprice	Credit term	Balance	Percentage of total notes/accounts receivable(payable)
Hsing-Yeh Biotechnology Co., Ltd.	Yeezen General Hospital	Substantive related party	Sale of goods	225,404 $	97%	6 months	-	-	229,726 $	85%	Note

Note 1: Sales amount includes rental revenue.

Note 2: Notes and accounts receivable include lease payments receivable.

Table 4, Page 1

CHC Healthcare Group and Subsidiaries

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

December 31, 2019

			December 31, 2019
Table 5 Creditor	Counterparty	Relationship withthe counterparty	Balance as atDecember31,2019	Turnover rate	Overduereceivables		Amount collected subsequent to the Allowance for balance sheet date doubtfulaccounts Expressed in thousands of NTD (Except as otherwise indicated)
					Amount	Actiontaken
Hsing-Yeh Biotechnology Co., Ltd.	Yeezen General Hospital	Substantive related party	Notes and accounts receivable (including lease payments receivable): $229,726	0.96	95,238 $	In collection	41,931 $	- $

Table 5,Page 1

CHC Healthcare Group and Subsidiaries

Information on investees

For the year ended December 31, 2019

Table 6 Investor	Investee	Location	Main business activities	Initial investment amount	Initial investment amount	Sharesheld as atDecember31,2019	Sharesheld as atDecember31,2019	Sharesheld as atDecember31,2019	Net profit (loss) of the investee for the year endedDecember31,2019	Investment income (loss) recognised by the Company for the year ended December31,2019 Footnote Expressed in thousands of NTD (Except as otherwise indicated)	Investment income (loss) recognised by the Company for the year ended December31,2019 Footnote Expressed in thousands of NTD (Except as otherwise indicated)
				Balance as atDecember31,2019	Balance as atDecember31,2018	Numberofshares	Ownership (%)	Bookvalue
The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company CHC Healthcare (BVI) Limited	Chiu Ho Medical System Co., Ltd. Tomorrow Medical System Co., Ltd. Chiu Ho Scientific Co., Ltd. Chiu Ho Biotech Co., Ltd. Shin-Ho Instruments Co., Ltd. Tong-Lin Instruments Co., Ltd. Hua Lin Instruments Co., Ltd. Hsin Lin Biotech Co., Ltd. E Century Healthcare Corporation CHC Healthcare (BVI) Limited CHC Healthcare (HK) Limited	Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan British Virgin Islands Hong Kong	Medical instrument sale, leasing and services Medical instrument sale, leasing and services Ophthalmic equipment sale, leasing and services Medical instrument leasing Medical instrument leasing Medical instrument leasing Medical instrument leasing Medical instrument leasing Medical instrument leasing Holdings and indirect investments Medical instrument sale, leasing and services	2,380,988 $ 163,484 151,422 317,182 9,171 371,183 521,815 85,929 556,151 522,432 3,891	2,380,988 $ 163,484 151,422 357,182 9,171 371,183 521,815 105,929 556,151 522,432 3,987	308,000,000 45,800,000 9,853,841 33,000,000 300,000 40,000,000 55,600,000 8,000,000 60,000,000 940 100,000	100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%	3,568,853 $ 570,480 142,954 349,687 7,931 486,998 634,486 76,750 814,635 423,736 39,653	181,786 $ 48,184 20,699 11,669 612) ( 39,392 19,561 10,754) ( 61,594 16,829 184) (	183,011 $ 48,184 20,699 11,678 612) ( 39,435 19,561 10,754) ( 61,594 16,829 141) (	Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary (Note 1) Subsidiary

Table 6, Page 1

Investor	Investee	Location	Main business activities	Initial investment amount	Initial investment amount	Sharesheld as atDecember31,2019	Sharesheld as atDecember31,2019	Sharesheld as atDecember31,2019	Net profit (loss) of the investee for the year endedDecember31,2019	recognised by the Company for the year ended December31,2019	Footnote
				Balance as atDecember31,2019	Balance as atDecember31,2018	Numberofshares	Ownership (%)	Bookvalue
Chiu Ho Medical System Co., Ltd. Chiu Ho Medical System Co., Ltd. Chiu Ho Medical System Co., Ltd. Medlink Healthcare Limited Hsing-Yeh Biotechnology Co., Ltd. SenCare Healthcare Company	Medlink Healthcare Limited SenCare Healthcare Company PT CHC Medika Indonesia Hsing-Yeh Biotechnology Co., Ltd. CHENG-HSIN Biotechnology Co., Ltd. CHC Long-term Care Corporation	Taiwan Taiwan Indonesia Taiwan Taiwan Taiwan	Medical instrument sale Consulting service and elderly residence Medical instrument leasing Medical instrument sale and leasing ; drug sale Management consulting services and retail sales of food products and drugs Long-term care services	1,545,300 $ 194,000 2,768 1,513,464 12,000 31,040	1,545,300 $ 194,000 - 1,513,464 12,000 -	154,125,000 19,400,000 1,275 93,600,000 1,200,000 -	100.00% 65.99% 100.00% 100.00% 40.00% 97.00%	1,595,689 $ 191,792 670 1,626,203 277 31,001	41,335 $ 50) ( 2,138) ( 46,870 2,582) ( 40) (	41,335 $ 33) ( 2,138) ( 42,327 1,033) ( 39) (	Subsidiary Subsidiary Subsidiary (Note 1) Subsidiary Associate Subsidiary (Note 2)

Note 1: Indirect investment company is organised as a limited liability company. Note 2: Investee was organised as an associate.

Table 6, Page 2

CHC Healthcare Group and Subsidiaries

Information on investments in Mainland China

For the year ended December 31, 2019

Table 7 Investee in Mainland China	Main business activities	Paid-in capital	Investment method （Note 1）	Accumulated amount of remittance from Taiwan to Mainland China as of January 1, 2019	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the year ended December 31,2019	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the year ended December 31,2019	Accumulated amount of remittance from Taiwan to Mainland China as of December 31, 2019	Net income of investee for the year ended December 31,2019	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the year ended December 31, 2019 （Note 2）	Book value of investments in Mainland China as of December 31, 2019	Accumulated amount of investment income remitted back to Taiwan as of December 31,2019 Footnote Expressed in thousands of NTD (Except as otherwise indicated)	Accumulated amount of investment income remitted back to Taiwan as of December 31,2019 Footnote Expressed in thousands of NTD (Except as otherwise indicated)
					Remitted to Mainland China	Remitted back to Taiwan
Guangzhou Chiuho Medical System Co., Ltd. Medical instrument sale, leasing and services Chiu Ho (CHINA) Medical Technology Co., Ltd. Medical instrument sale, leasing and services Companyname		284,893 $ (2) Indirect investment through CHC(BVI), a wholly- owned subsidiary of the Company 226,182 (2) Indirect investment through CHC(BVI), a wholly- owned subsidiary of the Company Accumulated amount of December 31,2019 to Mainland China as of remittance from Taiwan		284,893 $ - $ 226,182 - Economic affairs(MOEA) Commission of the Ministry of by the Investment Investment amount approved		- $ 284,893 $ - 226,182 Ceiling on Commission of MOEA(Note 3) imposed by the Investment investments in Mainland China		22,363 $ 5,211) (	100% 100%	22,243 $ 5,211) (	250,235 $ 125,160	- $ -
CHC Healthcare (BVI) Limited		511,075 $		659,577 $		3,190,403 $

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

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

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

Note 2: Income (loss) recognised based on financial statements audited by independent auditors

Note 3: Disclosed in accordance with the investment limits set forth in Jin-Shen-Zi No. 09704604680, issued by the Investment Comission of MOEA on August 29, 2008

Note 4: The Company invested in the investees in Mainland China, including Neusoft CHC Medical Service Co., Ltd. and Dalian Neusoft Kangrui Jiuhe Medical Management Co., Ltd. through an existing company in Mainland China. Due to the existing company in

Mainland China is a holding company, therefore it shall first submit an application for approval from Investment Commission of the Ministry of Economic Affairs (MOEA) for its reinvestments, but the approval from MOEA are not required for other investments.

Table 7, Page 1