CHROMA — Annual Report 2021

Dec 3, 2021

Chroma ATE Inc. and Subsidiaries

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

DECLARATION OF CONSOLIDATION OF FINANCIAL STATEMENTS OF AFFILIATES

The entities required to be included in the consolidated financial statements of affiliates in accordance with the "Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises" for the year ended December 31, 2021 are all the same as the companies required to be included in the consolidated financial statements of parent and subsidiary companies as provided in International Financial Reporting Standards 10 "Consolidated Financial Statements". Relevant information that should be disclosed in the consolidated financial statements of affiliates has all been disclosed in the consolidated financial statements of parent and subsidiary companies. Hence, we did not prepare a separate set of consolidated financial statements of affiliates.

Very truly yours,

CHROMA ATE INC.

LEO HUANG Chairman

February 23, 2022

Key audit matter of the consolidated financial statements for the year ended December 31, 2021 is stated as follows:

Revenue Recognition

The main source of revenue of the Group comes from the sales of test instruments. Since the main condition of contract with customers is under FOB shipping point, the determination of the point of shipment is important in assessing whether the obligations of delivery are satisfied and recognized as sales revenue; thus, we identified the revenue recognition of contract with customers as a key audit matter.

Our audit procedures included evaluating the appropriateness of accounting policies for the recognition of sales revenue, testing the effectiveness of internal controls related to the timing of revenue recognition in the sales cycle, selecting samples to perform test of details on transactions, identifying material terms and conditions in the contracts or orders, and checking the original documents such as the shipping documents and invoices to confirm the correctness of the identified performance obligations at the time of sales recognition.

We also considered the appropriateness of the disclosure of revenue, refer to Note 4 and Note 22.

Other Matter

We have also audited the parent company only financial statements of Chroma ATE Inc. as of and for the years ended December 31, 2021 and 2020 on which we have issued an unmodified opinion.

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

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

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

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

Auditors' Responsibilities for the Audit of the Consolidated Financial Statements

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

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

• 1. Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• 1. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.
• 1. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• 1. Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors' report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors' report. However, future events or conditions may cause the Group to cease to continue as a going concern.
• 1. 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.
• 1. Obtain sufficient and appropriate audit evidence regarding the financial information of entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision, and performance of the group audit. We remain solely responsible for our audit opinion.

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

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

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

The engagement partners on the audits resulting in this independent auditors' report are Wen-Chin Lin and Chien-Liang Liu.

Deloitte & Touche Taipei, Taiwan Republic of China

February 23, 2022

Notice to Readers

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

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

CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2021 AND 2020 (In Thousands of New Taiwan Dollars)

	2021		2020
ASSETS	Amount	%	Amount	%
CURRENT ASSETS Cash and cash equivalents (Note 6)	\$ 3,088,158	10	\$ 2,896,645	10
Financial assets at fair value through profit or loss - current (Note 7)	504,949	2	509,015	2
Financial assets at amortized cost - current (Notes 9 and 30)	1,353,890	5	1,036,691	4
Contract assets - current (Note 22)	779,547	3	1,278,936	4
Notes receivable (Note 10)	198,853	1	127,042	-
Trade receivables (Note 10)	4,292,917	14	4,247,500	15
Trade receivables - related parties (Notes 10 and 29)	33,969	-	19,340	-
Inventories (Note 11)	3,915,791	13	3,028,457	11
Prepayments	261,498	1	197,038	1
Other current assets (Note 29)	294,960	1	187,175	1
Total current assets	14,724,532	50	13,527,839	48
NON-CURRENT ASSETS
Financial assets at fair value through profit or loss - non-current (Note 7)	4,793	-	4,646	-
Financial assets at fair value through other comprehensive income - non-current (Note 8)	1,166,892	4	862,898	3
Investments accounted for using the equity method (Note 13)	3,127,364	11	3,139,227	11
Property, plant and equipment (Notes 14, 29 and 30)	6,096,436	21	3,156,634	11
Right-of-use assets (Notes 15 and 29)	345,318	1	144,921	1
Investment properties (Note 16)	3,137,187	11	3,137,187	11
Goodwill (Note 17)	225,695	1	228,002	1
Other intangible assets	97,413	-	55,578	-
Deferred tax assets (Note 24)	345,338	1	314,987	1
Prepayments for land and equipment	118,865	-	3,463,185	13
Refundable deposits	20,268	-	13,693	-
Non-current prepayments for investments	55,024	-	-	-
Other non-current assets (Note 20)	80,992	-	80,086	-
Total non-current assets	14,821,585	50	14,601,044	52
TOTAL	\$ 29,546,117	100	\$ 28,128,883	100
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term borrowings (Note 18)	\$ 1,901,110	7	\$ 2,554,260	9
Contract liabilities - current (Notes 22 and 29)	746,946	3	765,682	3
Notes payable	31,549	-	35,933	-
Notes payable - related parties (Note 29)	2,953	-	4,570	-
Trade payables	3,009,505	10	2,637,070	10
Trade payables - related parties (Note 29)	11,005	-	11,353	-
Other payables (Notes 19 and 29)	1,372,698	5	1,210,998	4
Current tax liabilities	405,049	1	348,441	1
Lease liabilities - current (Notes 15 and 29)	107,604	-	55,247	-
Current portion of long-term borrowings (Notes 18 and 30)	213,053	1	633,456	2
Other current liabilities	78,016	-	153,317	1
Total current liabilities	7,879,488	27	8,410,327	30
NON-CURRENT LIABILITIES
Long-term borrowings (Notes 18 and 30)	1,447,169	5	2,404,616	9
Deferred tax liabilities (Note 24)	767,422	3	621,111	2
Lease liabilities - non-current (Notes 15 and 29)	276,636	1	92,345	-
Net defined benefit liabilities (Note 20)	174,889	-	156,280	1
Guarantee deposits received	43,334	-	40,886	-
Other non-current liabilities	9,721	-	14,625	-
Total non-current liabilities	2,719,171	9	3,329,863	12
Total liabilities	10,598,659	36	11,740,190	42

EQUITY ATTRIBUTABLE TO OWNERS OF THE CORPORATION (Note 21)
Ordinary share capital	4,218,745	14	4,212,945	15
Capital surplus	4,087,223	14	4,036,875	14
Retained earnings
Legal reserve	2,824,310	10	2,592,487	9
Special reserve	86,888	-	176,128	1
Unappropriated earnings	7,255,798	25	5,160,575	18
Total retained earnings	10,166,996	35	7,929,190	28
Other equity	74,633	-	(82,101)	-
Treasury shares	(33,686)	-	(33,686)	-
Total equity attributable to owners of the Corporation	18,513,911	63	16,063,223	57
NON-CONTROLLING INTERESTS	433,547	1	325,470	1
Total equity	18,947,458	64	16,388,693	58
TOTAL	\$ 29,546,117	100	\$ 28,128,883	100

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

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

	2021
	Amount	%	2020 Amount	%
NET OPERATING REVENUE (Notes 22 and 29)	\$ 17,584,023	100	\$ 15,532,543	100
OPERATING COSTS (Notes 11, 23 and 29)	9,133,871	52	7,988,328	51
GROSS PROFIT	8,450,152	48	7,544,215	49
REALIZED GAIN ON TRANSACTIONS WITH ASSOCIATES AND JOINT VENTURES	1	-	5	-
REALIZED GROSS PROFIT	8,450,153	48	7,544,220	49
OPERATING EXPENSES (Notes 23 and 29) Selling and marketing expenses General and administrative expenses Research and development expenses Expected credit impairment losses	2,307,707 1,264,956 1,511,465 291,032	13 7 9 2	2,080,171 1,080,518 1,341,956 244,174	13 7 9 2
Total operating expenses	5,375,160	31	4,746,819	31
PROFIT FROM OPERATIONS	3,074,993	17	2,797,401	18
NON-OPERATING INCOME AND EXPENSES Finance costs (Notes 23 and 29)	(44,738)	-	(58,811)	-
Share of profits of associates and joint ventures (Note 13) Interest income	304,129 24,391	2 -	135,392 16,843	1 -
Dividend income Other income (Note 29)	71,755 175,111	- 1	21,730 194,914	- 1
Gain on disposal of property, plant and equipment, net (Notes 14 and 29) Gain arising from transfer of right in sale and	1,585,428	9	7,066	-
lease-back transaction	154,510	1	-	-
Gain from lease modification	671	-	-	-
Net foreign exchange loss (Note 34) Gain on disposal of investment (Loss) gain on financial assets at fair value through	(54,773) 2,684	- -	(86,618) 480	(1) -
profit or loss, net Other expenses	(2,211) (8,104)	- -	8,903 (8,293)	- -
Total non-operating income and expenses	2,208,853	13	231,606	1
PROFIT BEFORE INCOME TAX	5,283,846	30	3,029,007	19
INCOME TAX EXPENSE (Note 24)	978,531	6	648,050	4
NET PROFIT FOR THE YEAR	4,305,315	24	2,380,957	15 (Continued)

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

	2021			2020
		Amount	%		Amount	%
OTHER COMPREHENSIVE INCOME (LOSS) Items that will not be reclassified subsequently to profit or loss:
Remeasurement of defined benefit plans Unrealized gain or loss on investments in equity investments designated as at fair value through	\$	(40,175)	-	\$	(5,258)	-
other comprehensive income Share of the other comprehensive loss of		298,132	2		229,747	2
associates and joint ventures accounted for using the equity method Items that may be reclassified subsequently to profit or loss:		(4,327)	-		(504)	-
Exchange differences on translating the financial statements of foreign operations Share of the other comprehensive loss of associates and joint ventures accounted for		(76,832)	(1)		(9,764)	-
using the equity method		(70,564)	-		(136,084)	(1)
Total other comprehensive income		106,234	1		78,137	1
TOTAL COMPREHENSIVE INCOME	\$	4,411,549	25	\$	2,459,094	16
NET PROFIT ATTRIBUTABLE TO: Owners of the Corporation Non-controlling interests	\$	4,179,232 126,083	24 -	\$	2,323,776 57,181	15 -
	\$	4,305,315	24	\$	2,380,957	15
TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Owners of the Corporation Non-controlling interests	\$	4,294,625 116,924	24 1	\$	2,412,798 46,296	16 -
	\$	4,411,549	25	\$	2,459,094	16
EARNINGS PER SHARE (NT\$; Note 25) Basic Diluted		\$ 9.96 \$ 9.89			\$ 5.56 \$ 5.51

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

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

Benefit	Total	Treasury Shares	Total	Non-controlling Interests	Total Equity

							Equity Attributable to Owners of the Corporation
								Exchange	Unrealized Gain	Other Equity
								Differences on	(Loss) on Financial
					Retained Earnings			Translating the Financial	Assets at Fair Value through Other
	Ordinary Share Capital	Advance Receipts for Share Capital	Capital Surplus	Legal Reserve	Special Reserve	Unappropriated Earnings	Total	Statements of Foreign Operations	Comprehensive Income	Unearned Employee Benefit	Total	Treasury Shares	Total	Non-controlling Interests	Total Equity
BALANCE AT JANUARY 1, 2020	\$ 4,192,961	\$ 13,724	\$ 3,629,471	\$ 2,407,039	\$ 86,888	\$ 4,382,043	\$ 6,875,970	\$ (331,073)	\$ 154,946	\$ (11,524)	\$ (187,651)	\$ (35,714)	\$ 14,488,761	\$ 296,699	\$ 14,785,460
Appropriation of the 2019 earnings
Legal reserve Special reserve Cash dividends - NT\$3.0 per share	- - -	- - -	- - -	185,448 - -	- 89,240 -	(185,448) (89,240) (1,265,000)	- - (1,265,000)	- - -	- - -	- - -	- - -	- - -	- - (1,265,000)	- - -	- - (1,265,000)
Change in capital surplus from investments in associates and
joint ventures accounted for using the equity method	-	-	273,530	-	-	-	-	-	-	-	-	-	273,530	-	273,530
Net profit for the year ended December 31, 2020	-	-	-	-	-	2,323,776	2,323,776	-	-	-	-	-	2,323,776	57,181	2,380,957
Other comprehensive income (loss) for the year ended December 31, 2020	-	-	-	-	-	(5,556)	(5,556)	(134,969)	229,547	-	94,578	-	89,022	(10,885)	78,137
Total comprehensive income (loss) for the year ended December 31, 2020	-	-	-	-	-	2,318,220	2,318,220	(134,969)	229,547	-	94,578	-	2,412,798	46,296	2,459,094
Buy-back of treasury shares	-	-	-	-	-	-	-	-	-	-	-	(1,235)	(1,235)	-	(1,235)
Cancelation of treasury shares	(1,235)	-	-	-	-	-	-	-	-	-	-	1,235	-	-	-
Stocks of the parent company disposed of by the subsidiary and recognized as treasury shares transaction	-	-	16,629	-	-	-	-	-	-	-	-	2,028	18,657	-	18,657
Adjustment of capital surplus for the Corporation's cash dividends received by subsidiaries	-	-	5,760	-	-	-	-	-	-	-	-	-	5,760	-	5,760
Disposal of investments accounted for using equity method	-	-	(22 )	-	-	-	-	-	-	-	-	-	(22 )	-	(22 )
Exercise of employee share options	21,219	(13,724 )	105,068	-	-	-	-	-	-	-	-	-	112,563	-	112,563
Share-based payment transaction	-	-	6,439	-	-	-	-	-	-	10,972	10,972	-	17,411	-	17,411
Share-based payment transaction by subsidiary	-	-	-	-	-	-	-	-	-	-	-	-	-	20	20
Cash dividends distributed by subsidiary	-	-	-	-	-	-	-	-	-	-	-	-	-	(17,545)	(17,545)
BALANCE AT DECEMBER 31, 2020	4,212,945	-	4,036,875	2,592,487	176,128	5,160,575	7,929,190	(466,042)	384,493	(552 )	(82,101)	(33,686)	16,063,223	325,470	16,388,693
Appropriation of the 2020 earnings Legal reserve	-	-	-	231,823	-	(231,823)	-	-	-	-	-	-	-	-	-
Reversal of special reserve Cash dividends - NT\$4.5 per share	- -	- -	- -	- -	(89,240) -	89,240 (1,897,175)	- (1,897,175)	- -	- -	- -	- -	- -	- (1,897,175)	- -	- (1,897,175)
Change in capital surplus from investments in associates and joint ventures accounted for using the equity method	-	-	13,428	-	-	-	-	-	-	-	-	-	13,428	-	13,428
Net profit for the year ended December 31, 2021	-	-	-	-	-	4,179,232	4,179,232	-	-	-	-	-	4,179,232	126,083	4,305,315
Other comprehensive income (loss) for the year ended December 31, 2021	-	-	-	-	-	(40,780)	(40,780)	(137,999)	294,172	-	156,173	-	115,393	(9,159)	106,234
Total comprehensive income (loss) for the year ended December 31, 2021	-	-	-	-	-	4,138,452	4,138,452	(137,999)	294,172	-	156,173	-	4,294,625	116,924	4,411,549
Adjustment of capital surplus for the Corporation's cash dividends received by subsidiaries	-	-	8,124	-	-	-	-	-	-	-	-	-	8,124	-	8,124
Changes in ownership interests in subsidiaries	-	-	-	-	-	(3,462)	(3,462)	-	-	-	-	-	(3,462)	21,646	18,184
Exercise of employee share options	5,800	-	27,906	-	-	-	-	-	-	-	-	-	33,706	-	33,706
Share-based payment transaction	-	-	890	-	-	-	-	-	-	552	552	-	1,442	-	1,442
Cash dividends distributed by subsidiaries	-	-	-	-	-	-	-	-	-	-	-	-	-	(30,493)	(30,493)
Unrealized gain or loss transferred to retained earnings from disposal of equity instruments designated at fair value through other comprehensive income and investments accounted for using equity method	-	-	-	-	-	(9 )	(9 )	-	9	-	9	-	-	-	-
BALANCE AT DECEMBER 31, 2021	\$ 4,218,745	\$ -	\$ 4,087,223	\$ 2,824,310	\$ 86,888	\$ 7,255,798	\$ 10,166,996	\$ (604,041)	\$ 678,674	\$ -	\$ 74,633	\$ (33,686)	\$ 18,513,911	\$ 433,547	\$ 18,947,458

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

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

	2021	2020
CASH FLOWS FROM OPERATING ACTIVITIES
Income before income tax	\$ 5,283,846	\$ 3,029,007
Adjustments for:
Depreciation expenses	572,034	428,009
Amortization expenses	22,035	11,225
Expected credit loss recognized on trade receivables	291,032	244,174
Net loss (gain) on financial liabilities at fair value through profit or
loss	2,211	(8,903)
Finance costs	44,738	58,811
Interest income	(24,391)	(16,843)
Dividend income	(71,755)	(21,730)
Compensation costs of share-based payment	1,415	16,968
Share of profit of associates and joint ventures accounted for using
the equity method	(304,129)	(135,392)
Gain on disposal of property, plant and equipment, net	(1,585,428)	(7,066)
Gain on disposal of investments accounted for using equity method	(2,684)	(480)
Write-downs of inventories	11,835	46,444
Realized gain on transactions with associates and joint ventures	(1)	(5)
Net loss on foreign currency exchange	89,008	36,798
Gain on sale and leaseback transactions	(154,510)	-
Gain on lease modification	(671)	-
Net changes in operating assets and liabilities
Contract assets	183,958	(20,890)
Notes receivable	(71,811)	47,879
Trade receivables Inventories	(440,983) (1,059,965)	74,720 (472,222)
Prepayments	(37,294)	32,237
Other current assets	(100,528)	47,114
Contract liabilities	(18,736)	(249,175)
Notes payable	(6,001)	(582)
Trade payables	700,694	58,538
Other payables	180,730	(98,893)
Other current liabilities	(75,301)	124,715
Net defined benefit liabilities	(21,566)	(12,067)
Cash generated from operations	3,407,782	3,212,391
Income tax paid	(815,995)	(497,845)
Net cash generated from operating activities	2,591,787	2,714,546
CASH FLOWS FROM INVESTING ACTIVITIES
Payments to acquire financial assets at fair value through other
comprehensive income	(15,750)	(39,157)
Proceeds from capital reduction of financial assets at fair value through
other comprehensive income	9,660	-
Increase in financial assets at amortized cost	(380,584)	(432,301) (Continued)

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

	2021	2020
Decrease in financial assets at amortized cost	\$ 57,987	\$ 101,432
Payments to acquire financial assets at fair value through profit or loss	(860,548)	(635,910)
Proceeds from disposal of financial assets at fair value through profit
or loss	861,217	654,738
Net cash inflow on disposal of investments accounted for using equity
method	3,955	688
Increase in prepayments for investments	(55,024)	-
Payments for property, plant and equipment	(110,760)	(186,589)
Proceeds from disposal of property, plant and equipment	3,107,338	41,941
Increase in advance receipts for real estate	-	308,000
(Increase) decrease in refundable deposits	(6,575)	9,720
Payments to acquire intangible assets	(28,976)	(4,750)
(Increase) decrease in other non-current assets	(2,682)	1,579
Increase in prepayments for equipment	(972,547)	(1,447,454)
Interest received	24,828	16,435
Dividends received	106,089	65,842
Net cash generated from (used in) investing activities	1,737,628	(1,545,786)
CASH FLOWS FROM FINANCING ACTIVITIES
(Decrease) increase in short-term borrowings	(648,950)	208,310
Proceeds from long-term borrowings	77,411	998,506
Repayments of long-term borrowings	(1,449,124)	(401,363)
Increase in guarantee deposits	2,448	20,886
Repayment of lease principal	(121,042)	(102,712)
Decrease in other non-current liabilities	(4,904)	(2,857)
Cash dividends paid	(1,927,668)	(1,288,777)
Exercise of employee share options	33,706	112,563
Payments for buy-back of ordinary shares	-	(1,235)
Proceeds from reissuance of treasury stock	-	18,657
Acquisition of ownership interests in subsidiaries	18,184	-
Interest paid	(51,290)	(64,304)
Net cash used in financing activities	(4,071,229)	(502,326)
EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE
OF CASH HELD IN FOREIGN CURRENCIES	(66,673)	(31,320)
NET INCREASE IN CASH AND CASH EQUIVALENTS	191,513	635,114
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR	2,896,645	2,261,531
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR	\$ 3,088,158	\$ 2,896,645

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

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

1. GENERAL INFORMATION

Chroma ATE Inc. (the "Corporation") was incorporated in the Republic of China (ROC) in November 1984. The Corporation mainly designs, assembles, calibrates, manufactures, sells, repairs and maintains software/hardware for computers and peripherals, computerized automatic test systems, electronic test instruments, signal generators, power supplies, telecom power supplies, etc. as well as serves as an agent to sell these products. The Corporation's shares have been listed on the Taiwan Stock Exchange since December 21, 1996.

The consolidated financial statements of the Corporation and its subsidiaries are presented in the Corporation's functional currency, the New Taiwan dollar (NTD).

2. APPROVAL OF CONSOLIDATED FINANCIAL STATEMENTS

The consolidated financial statements were approved by the Corporation's board of directors on February 23, 2022.

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

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

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

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

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

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

• Note 2: The amendments are applicable to business combinations for which the acquisition date is on or after the beginning of the annual reporting period beginning on or after January 1, 2022.
• Note 3: The amendments are applicable to property, plant and equipment that are brought to the location and condition necessary for them to be capable of operating in the manner intended by management on or after January 1, 2021.
• Note 4: The amendments are applicable to contracts for which the entity has not yet fulfilled all its obligations on January 1, 2022.

As of the date the consolidated financial statements were authorized for issue, the Group has assessed that the application of above standards and interpretations will not have a material impact on the Group's financial position and financial performance.

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

	Effective Date
New IFRSs	Announced by IASB (Note 1)
Amendments to IFRS 10 and IAS 28 "Sale or Contribution of Assets	To be determined by IASB
between An Investor and Its Associate or Joint Venture"
IFRS 17 "Insurance Contracts"	January 1, 2023
Amendments to IFRS 17	January 1, 2023
Amendments to IFRS 17 "Initial Application of IFRS 9 and IFRS 17 -	January 1, 2023
Comparative Information"
Amendments to IAS 1 "Classification of Liabilities as Current or	January 1, 2023
Non-current"
Amendments to IAS 1 "Disclosure of Accounting Policies"	January 1, 2023 (Note 2)
Amendments to IAS 8 "Definition of Accounting Estimates"	January 1, 2023 (Note 3)
Amendments to IAS 12 "Deferred Tax related to Assets and	January 1, 2023 (Note 4)
Liabilities arising from a Single Transaction"

• Note 1: Unless stated otherwise, the above New IFRSs are effective for annual reporting periods beginning on or after their respective effective dates.
• Note 2: The amendments will be applied prospectively for annual reporting periods beginning on or after January 1, 2023.
• Note 3: The amendments are applicable to changes in accounting estimates and changes in accounting policies that occur on or after the beginning of the annual reporting period beginning on or after January 1, 2023.
• Note 4: Except for deferred taxes that will be recognized on January 1, 2022 for temporary differences associated with leases and decommissioning obligations, the amendments will be applied prospectively to transactions that occur on or after January 1, 2022.

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

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a. Statement of compliance

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

b. Basis of preparation

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

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

• 1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;
• 2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for an asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and
• 3) Level 3 inputs are unobservable inputs for an asset or liability.
• c. Classification of current and noncurrent assets and liabilities

Current assets include:

• 1) Assets held primarily for the purpose of trading;
• 2) Assets expected to be realized within 12 months after the reporting period; and
• 3) Cash and cash equivalents unless the asset is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period.

Current liabilities include:

• 1) Liabilities held primarily for the purpose of trading;
• 2) Liabilities due to be settled within 12 months after the reporting period; and
• 3) Liabilities for which the Group does not have an unconditional right to defer settlement for at least 12 months after the reporting period.

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

d. Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Corporation and the entities controlled by the Corporation (its subsidiaries). Income and expenses of subsidiaries acquired or disposed of during the period are included in the consolidated statement of profit or loss and other comprehensive income from the effective dates of acquisitions up to the effective dates of disposals, as appropriate. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the Group. All intra-group transactions, balances, income and expenses are eliminated in full upon consolidation. Total comprehensive income of subsidiaries is attributed to the owners of the Corporation and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

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

Refer to Note 12 for detailed information on subsidiaries (including percentage of ownership and main business).

e. Foreign currencies

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

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

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

Non-monetary items denominated in a foreign currency and measured at historical cost is stated at the reporting currency as originally translated from the foreign currency.

For the purpose of presenting consolidated financial statements, the financial statements of the Corporation's foreign operations (including subsidiaries, associates, joint ventures and branches in other countries) that are prepared using functional currencies which are different from the currency of the Corporation are translated into the presentation currency, the New Taiwan dollar, as follows: Assets and liabilities are translated at the exchange rates prevailing at the end of the reporting period; income and expense items are translated at the average exchange rates for the period. The resulting currency translation differences are recognized in other comprehensive income (attributed to the owners of the Corporation and non-controlling interests as appropriate).

On the disposal of a foreign operation (i.e. a disposal of the Corporation's entire interest in a foreign operation, or a disposal involving the loss of control over a subsidiary that includes a foreign operation, or a partial disposal of an interest in an associate that includes a foreign operation of which the retained interest becomes a financial asset), all of the exchange differences accumulated in equity in respect of that operation attributable to the owners of the Corporation are reclassified to profit or loss.

In a partial disposal of a subsidiary that does not result in the Corporation losing control over the subsidiary, the proportionate share of accumulated exchange differences is re-attributed to non-controlling interests of the subsidiary and is not recognized in profit or loss. For all other partial disposals, the proportionate share of the accumulated exchange differences recognized in other comprehensive income is reclassified to profit or loss.

f. Inventories

Inventories consist of raw materials, semi-finished goods, work-in-process, finished goods and inventory in transit, which are stated at the lower of cost or net realizable value. Inventory write-downs are made by item, except where it may be appropriate to group similar or related items. The net realizable value is the estimated selling price of inventories less all estimated costs of completion and costs necessary to make the sale. Inventories are recorded at standard cost and make timely adjustments to ensure that they approximate to weighted-average cost.

g. Investments in associates and joint ventures

An associate is an entity over which the Group has significant influence and which is neither a subsidiary nor an interest in a joint venture. A joint venture is a joint arrangement whereby the Group and other parties that have joint control of the arrangement have rights to the net assets of the arrangement.

The Group uses the equity method to account for its investments in associates and joint ventures, under the equity method, investments in an associate and a joint venture are initially recognized at cost and adjusted thereafter to recognize the Group's share of the profit or loss and other comprehensive income of the associate and joint venture. The Group also recognizes the changes in the Group's share of the equity of associates and joint ventures.

Any excess of the cost of acquisition over the Group's share of the net fair value of the identifiable assets and liabilities of an associate or a joint venture at the date of acquisition is recognized as goodwill, which is included within the carrying amount of the investment and is not amortized. Any excess of the Group's share of the net fair value of the identifiable assets and liabilities over the cost of acquisition, after reassessment, is recognized immediately in profit or loss.

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

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

The Group discontinues the use of the equity method from the date on which its investment ceases to be an associate and a joint venture. Any retained investment is measured at fair value at that date, and the fair value is regarded as its fair value on initial recognition as a financial asset. The difference between the previous carrying amount of the associate and the joint venture attributable to the retained interest and its fair value is included in the determination of the gain or loss on disposal of the associate and the joint venture. The Group accounts for all amounts previously recognized in other comprehensive income in relation to that associate and the joint venture on the same basis as would be required had that associate directly disposed of the related assets or liabilities. If an investment in an associate becomes an investment in a joint venture or an investment in a joint venture becomes an investment in an associate, the Group continues to apply the equity method and does not remeasure the retained interest.

When an entity in the Group transacts with its associate and joint venture, profits and losses resulting from the transactions with the associate and joint venture are recognized in the Group's consolidated financial statements only to the extent that interests in the associate and the joint venture are not related to the Group.

h. Property, plant and equipment

Property, plant and equipment are initially measured at cost and subsequently measured at cost less accumulated depreciation and accumulated impairment loss.

Property, plant and equipment in the course of construction are measured at cost less any recognized impairment loss. Cost includes professional fees and borrowing costs eligible for capitalization. Such assets are depreciated and classified to the appropriate categories of property, plant and equipment when completed and ready for their intended use.

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

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

i. Investment properties

Investment properties are properties held to earn rentals and/or for capital appreciation. Investment properties include properties under construction that meet the definition of investment properties. Investment properties also include land held for a currently undetermined future use.

Investment properties are initially measured at cost, including transaction costs. Subsequent to initial recognition, investment properties are measured at cost less accumulated depreciation and accumulated impairment loss. Depreciation is recognized using the straight-line method.

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

j. Goodwill

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

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

If goodwill has been allocated to a cash-generating unit and the Group disposes of an operation within that unit, the goodwill associated with the operation which is disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal and is measured on the basis of the relative values of the operation disposed of and the portion of the cash-generating unit retained.

k. Intangible assets

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

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

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

l. Financial instruments

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

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

For those financial assets which are measured at fair value, its fair value is determined in the manner described in Note 28.

1) Financial assets

All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis. The Group derecognizes a financial asset only when the contractual rights to the cash flows from the asset expire or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party.

The Group's financial assets are classified into the following categories:

a) Financial assets at FVTPL

The Group's financial assets mandatorily classified as at FVTPL are investments in equity instruments which are not designated as at FVTOCI, it was measured at fair value, and any dividends or interest earned on such financial assets are recognized in other income and interest income, respectively; any remeasurement gains or losses on such financial assets are recognized in other gains or losses.

b) Financial assets at amortized cost

If the financial assets, which are invested by the Group, are held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding, are subsequently measured at amortized cost.

Subsequent to initial recognition, financial assets are measured at amortized cost, which equals the gross carrying amount determined using the effective interest method less any impairment loss. Exchange differences are recognized in profit or loss. On derecognition, the difference between the asset's carrying amount and the sum of the consideration received and receivable is recognized in profit or loss.

Except for purchased or originated credit-impaired financial assets, for which interest income is calculated by applying the credit-adjusted effective interest rate to the amortized cost of such financial asset; and financial assets that are not credit-impaired on purchase or origination but have subsequently become credit-impaired, which interest income is calculated by applying the effective interest rate to the amortized cost of such financial assets in subsequent reporting periods, interest income is calculated by applying the effective interest rate to the gross carrying amount of such a financial asset.

A financial asset is credit impaired when one or more of the following events have occurred:

• i. Significant financial difficulty of the issuer or the borrower;
• ii. Breach of contract, such as a default;
• iii. It is becoming probable that the borrower will enter bankruptcy or undergo a financial reorganization; or
• iv. The disappearance of an active market for that financial asset because of financial difficulties.

The Group's financial assets at amortized cost include cash, pledge deposits, trade receivables at amortized cost and refundable deposits. Cash equivalents include time deposits with original maturities within 3 months from the date of acquisition, which are highly liquid, readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value. These cash equivalents are held for the purpose of meeting short-term cash commitments.

c) Investments in equity instruments at FVTOCI

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

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

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

2) Equity instruments

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

Equity instruments issued by the Group are recognized at the proceeds received, net of direct issue costs.

Repurchase of the Group's own equity instruments is recognized in and deducted directly from equity. No gain or loss is recognized in profit or loss on the purchase, sale, issuance or cancellation of the Group's own equity instruments.

3) Financial liabilities

Financial liabilities are measured at amortized cost using the effective interest method. When derecognition of financial liabilities, the difference between the carrying amount of a financial liability derecognized and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognized in profit or loss.

m. Assessment of assets impairment

1) Property, plant and equipment, right-of-use asset, investment properties and intangible assets

At the end of each reporting period, the Group reviews the carrying amounts of above assets, to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. When it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

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

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

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

2) Investments accounted for using the equity method

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

3) Goodwill

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

4) Financial assets and contract assets

The Group assesses the impairment loss of financial assets at amortized cost (including trade receivables) and contract assets by expected credit losses on each balance sheet date.

The Group always recognizes lifetime expected credit losses (ECLs) for trade receivables and contract assets. For all other financial instruments, the Group recognizes lifetime ECLs when there has been a significant increase in credit risk since initial recognition. If the credit risk on a financial instrument has not increased significantly, the Group measures the loss allowance for that financial instrument at an amount equal to 12-month ECLs.

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

For internal credit risk management purposes, the Group considers the following situations as indication that a financial asset is in default:

• a) Internal or external information shows that the debtor is unlikely to pay its creditors.
• b) Financial asset is more than 120 days past due unless the Group has reasonable and corroborative information to support a more lagged default criterion.

The impairment loss of all financial assets is recognized in profit or loss by a reduction in their carrying amounts through a loss allowance account.

n. Warranty provisions

Provisions are measured at the best estimate of the discounted cash flows of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. Provisions for the expected cost of warranty obligations to assure that products comply with agreed-upon specifications are recognized on the date of sale of the relevant products at the best estimate by the management of the Group of the expenditures required to settle the obligations.

o. Revenue recognition

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

1) Revenue from the sale of goods

Revenue from sale of goods comes from sales of test instruments and other products. Revenue is recognized when the goods are delivered to the customer's specific location or the goods are shipped because it is the time when the customer has full discretion over the manner of distribution and bears the risks of obsolescence. Trade receivables are recognized concurrently. The transaction price received is recognized as a contract liability until the goods are delivered to the customer.

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

2) Revenue from the rendering of services

Revenue from the rendering of services comes from wafer level test and development of cloud platform. The Group acquires enforceable right to payment for services rendered in accordance with customer contracts only upon completion of the services; thus, the Group recognizes revenue from rendering of services upon completion of the contract.

3) Construction contract revenue

For construction contracts to build customized production line, the Group recognizes revenue over time. The Group measures the progress on the basis of costs incurred relative to the total expected costs as there is a direct relationship between the costs incurred and the progress of satisfying the performance obligations. Contract assets are recognized during the construction and are reclassified to trade receivables at the point at which the customer is invoiced. If the milestone payments exceed the revenue recognized to date, then the Group recognizes contract liabilities for the difference. Certain payment retained by the customer as specified in the contract is intended to ensure that the Group adequately completes all of its contractual obligations. Such retention receivables are recognized as contract assets until the Group satisfies its performance obligations.

p. Leases

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

1) The Group as lessor

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

Lease payments (less any lease incentives payable) from operating leases are recognized as income on a straight-line basis over the terms of the relevant leases.

2) The Group as lessee

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

Right-of-use assets are initially measured at cost, which comprises the initial measurement of lease liabilities. Right-of-use assets are subsequently measured at cost less accumulated depreciation and impairment losses and adjusted for any remeasurement of the lease liabilities.

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

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

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

For sale and leaseback transactions, if the transfer of an asset satisfies the requirements of IFRS 15 to be accounted for as a sale, the Group recognizes only the amount of any gain or loss which relates to the rights transferred to the buyer-lessor, and adjusts the off-market terms to measure the sale proceeds at fair value. If the transfer does not satisfy the requirements of IFRS 15 to be accounted for as a sale, it is accounted for as a financing transaction.

q. Government grants

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

Government grants related to income are recognized in profit or loss on a systematic basis over the periods in which the Group recognizes as expenses the related costs for which the grants are intended to compensate. Specifically, government grants whose primary condition is that the Group should purchase, construct or otherwise acquire non-current assets are recognized as deferred revenue and transferred to profit or loss on a systematic and rational basis over the useful lives of the related assets.

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

• r. Employee benefits
• 1) Short-term employee benefits

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

2) Retirement benefits

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

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

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

3) Other long-term employee benefits

Other long-term employee benefits are accounted for in the same way as the accounting required for defined benefit plans except that remeasurement is recognized in profit or loss.

s. Share-based payment arrangements

Employee share options and restricted shares for employees granted to employee and others providing similar services are measured at the fair value of the equity instruments at the grant date. The fair value at the grant date of the employee share options and restricted shares for employees is expensed on a straight-line basis over the vesting period, based on the Group's best estimate of the number of the shares or options that are expected to ultimately vest, with a corresponding increase in capital surplus employee share options and other equity - unearned employee benefits. The expense is recognized in full at the grant date if the grants are vested immediately.

When restricted shares for employees are issued, other equity - unearned employee benefits is recognized on the grant date, with a corresponding increase in capital surplus - restricted shares for employees. If restricted shares for employees are granted for consideration and should be returned once the employee resigns, they are recognized as payables. Dividends paid to employees on restricted shares that do not need to be returned if employees resign in the vesting period are recognized as expenses when the dividends are declared with a corresponding adjustment in retained earnings and capital surplus - restricted shares for employees.

At the end of each reporting period, the Group revises its estimate of the number of employee share options and restricted shares for employees expected to vest. The impact of the revision of the original estimates is recognized in profit or loss such that the cumulative expenses reflect the revised estimate, with a corresponding adjustment to capital surplus - employee share options and capital surplus restricted shares for employees.

t. Taxation

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

1) Current tax

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

According to the Income Tax Law in the ROC, an additional tax of unappropriated earnings is provided for as income tax in the year the shareholders approve to retain earnings.

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

2) Deferred tax

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

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

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

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

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

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

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

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised if the revision affects only that period or in the period of the revision and future periods if the revisions affect both current and future periods.

a. Estimated impairment of trade receivables

The provision for impairment of trade receivables is based on assumptions about risk of default and expected loss rates. The Group uses judgment in making these assumptions and in selecting the inputs to the impairment calculation, based on the Group's historical experience, existing market conditions as well as forward looking estimates as of the end of each reporting period. For details of the key assumptions and inputs used, see Note 10. Where the actual future cash flows are less than expected, a material impairment loss may arise.

b. Write-down of inventories

The net realizable value of inventories is the estimated selling price in the ordinary course of business less the estimated costs of completion and disposal. The estimation of net realizable value is based on current market conditions and the historical experience with product sales of a similar nature. Changes in market conditions may have a material impact on the estimation of net realizable value.

6. CASH AND CASH EQUIVALENTS

	December 31
	2021	2020
Cash on hand	\$ 3,916	\$ 3,282
Checking accounts and demand deposits	3.037,842	2,753,550
Cash equivalents - time deposits	46,400	139,813
	\$ 3,088,158	\$ 2,896,645

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

	December 31
	2021	2020
Mandatorily at FVTPL - current
Domestic listed shares Domestic unlisted shares Open-end beneficiary certificates	\$ 6,643 53,224 445,082 \$ 504,949	\$ 4,763 58,830 445,422 \$ 509,015
Mandatorily at FVTPL - non-current
Open-end beneficiary certificates	\$ 4,793	\$ 4,646

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

	December 31
	2021	2020
Investments in equity instruments - non-current
Domestic listed ordinary shares and emerging market shares Domestic unlisted ordinary shares Foreign unlisted ordinary shares	\$ 1,013,265 136,548 17,079	\$ 723,973 131,196 7,729
	\$ 1,166,892	\$ 862,898

These investments in equity instruments are not held for trading. Instead, they are held for medium to long-term strategic purposes. Refer to Table 3 for the detailed information. Accordingly, the management elected to designate these investments in equity instruments as at FVTOCI as they believe that recognizing short-term fluctuations in these investments' fair value in profit or loss would not be consistent with the Group's strategy of holding these investments for long-term purposes.

9. FINANCIAL ASSETS MEASURED AT AMORTIZED COST - CURRENT

	December 31
	2021	2020
Time deposits with original maturities of more than 3 months Pledged deposits (Note 30)	\$ 573,576 780,314	\$ 307,298 729,393
	\$ 1,353,890	\$ 1,036,691

10. NOTES RECEIVABLE AND TRADE RECEIVABLES

	December 31
	2021	2020
Gross carrying amount at amortized cost - unrelated parties	\$ 5,204,804	\$ 4,807,675
Less: Allowance for impairment loss	(713,034)	(433,133)
	4,491,770	4,374,542
Gross carrying amount at amortized cost - related parties	33,969	19,340
	\$ 4,525,739	\$ 4,393,882

The average credit period for sales of goods is 60 to 120 days from the date when the goods were inspected and accepted by customers. Before accepting any new customer, the Group uses an external credit scoring system to assess the potential customer's credit quality and defines credit limits by customer. Customers' limits and scores are reviewed irregularly every year. Most of the trade receivables that are neither past due nor impaired have the best credit score under the external credit scoring system used by the Group.

The Group measures the loss allowance for trade receivables at an amount equal to lifetime ECLs. The expected credit losses on trade receivables are estimated by reference to the past default experience of the customers, the customers' current financial position, economic condition of the industry in which the customers operate. As the Group's historical credit loss experience does not show other factors that matter significantly, the expected credit loss rate is based on the past due status of trade receivables.

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

The aging schedule of notes receivable and trade receivables based on the past due days was as follows:

	December 31
	2021	2020
Not past due	\$ 3,600,204	\$ 3,369,032
Past due 1- 60 days	494,169	401,344
Past due 61-180 days	191,751	226,113
Past due 181-365 days	164,772	107,423
Past due over 365 days	753,908	703,763
	\$ 5,204,804	\$ 4,807,675

The movements of the loss allowance of notes receivable and trade receivables were as follows:

	For the Year Ended December 31
	2021	2020
Balance at January 1,	\$ 433,133	\$ 188,067
Add: Impairment loss	291,032	244,174
Less: Amounts written off	(9,766)	(220)
Foreign exchange gains and losses	(1,365)	1,112
Balance at December 31,	\$ 713,034	\$ 433,133

11. INVENTORIES

	December 31
	2021	2020
Finished goods	\$ 992,643	\$ 744,981
Semi-finished products	520,193	463,934
Work in process	937,215	687,087
Raw materials	1,465,740	1,126,671
Inventory in transit	-	5,784
	\$ 3,915,791	\$ 3,028,457

The cost of inventories recognized as cost of goods sold for the years ended December 31, 2021 and 2020 was \$8,127,064 thousand and \$7,268,112 thousand, respectively. The cost of goods sold included inventory write-downs of \$11,835 thousand and \$46,444 thousand, respectively.

12. SUBSIDIARIES

Subsidiaries included in the consolidated financial statements:

				Percentage of Ownership as of December 31
Investor	Investee	Business	2021	2020	Remark
The Corporation	Neworld Electronics Limited	Sale and maintenance of electronic test instruments, etc.	100.0	100.0
	Chroma New Material Corp.	Processing and sale of gold wire	100.0	100.0	Note 32
	Mas Automation Corp.	Design, manufacturing, installment and testing of automated factory conveyor systems	100.0	100.0
	Chroma ATE Inc.	Sale and maintenance of electronic test instruments, etc.	100.0	100.0
	Chroma Systems Solutions, Inc.	Sale and maintenance of electronic test instruments, etc.	25.0	25.0	Note 1
	Chroma ATE Europe B.V.	Sale and maintenance of electronic test instruments, etc.	100.0	100.0
	Chroma Japan Corp.	Sale and maintenance of electronic test instruments, etc.	100.0	100.0	Note 2
	CHI Incorporation Ltd.	Test of inductance, capacitance and resistance equipment and sale of parts	100.0	100.0
	Chen Hwa Technology Inc.	Test of inductance, capacitance and resistance equipment and sale of parts	100.0	100.0
	San Eagle Development Corp.	Investment	100.0	100.0
	Sensational Holdings Ltd.	Investment	100.0	100.0
	Deep Red Holding Co., Ltd.	Investment	100.0	100.0
	Testar Electronics Corporation	Testing of LED	67.2	67.2
	Adivic Technology Co., Ltd.	Sale and research of RF device	74.1	74.1
	Chroma Investment Co., Ltd.	Investment	100.0	100.0
	Quantel Private Ltd.	Sale and maintenance of test instruments, etc.	60.0	60.0
					(Continued)

			December 31	Percentage of Ownership as of
Investor	Investee	Business	2021	2020	Remark
	EVT Technology Co., Ltd.	Manufacturing of motorcycles and its parts	85.6	85.6
	Innovative Nanotech Incorporated	Monitoring instruments of nanoparticles	67.2	71.1	Note 3
	Touch Cloud Inc.	Development of cloud platform and Internet of Things systems	83.1	78.1	Note 4
Neworld Electronics Limited	Chroma Electronics (Shenzhen) Co., Ltd.	Sale of computerized automatic test systems, peripherals and electronic test instruments	100.0	100.0
	Chroma Electronics (Shanghai) Co., Ltd.	Sale of computerized automatic test systems, peripherals and electronic test instruments	100.0	100.0
Chroma ATE Inc.	Chroma Systems Solutions, Inc.	Sale and maintenance of electronic test instruments, etc.	50.0	50.0	Note 1
Chen Hwa Technology Inc.	Chroma (Shanghai) Trading Co., Ltd.	International and transit trading, simple commercial processing, commercial consulting services, etc.	100.0	100.0
CHI Incorporation Ltd.	Chroma ATE (Suzhou) Co., Ltd.	Sale of computerized automatic test systems, peripherals and electronic test instruments	100.0	100.0
San Eagle Development Corp.	Wei Kuang Mech. Eng. Inc.	Investment	100.0	100.0
Wei Kuang Mech. Eng. Inc.	Mou Kuan Technologies (Nanjing) Co., Ltd.	Assembly, sale and maintenance of factory conveyors and related systems and rendering after-sales services	100.0	100.0	Note 32
	Wei Kuang Automatic Equipment (Nanjing) Co., Ltd.	Sale and maintenance of electronic equipment and factory conveyor systems	100.0	100.0
	Wei Kuang Automatic Equipment (Xiamen) Co., Ltd.	Sale and maintenance of electronic equipment and factory conveyor systems	100.0	100.0
Deep Red Holdings Co., Ltd.	Saject System Technology (Suzhou) Co., Ltd.	Research, development and design of computer network security systems and information management	100.0	100.0
EVT Technology Co., Ltd.	Wei Da Electric Vehicle Co., Ltd.	Sale and lease of motorcycles	-	-	Note 5
Adivic Technology Co., Ltd.	Adivic Holding Corporation	Sale and research of RF device	100.0	100.0
Quantel Private Ltd.	Quantel Technologies India Private Ltd.	Sale and maintenance of test instruments, etc.	100.0	100.0
	Quantel Global Vietnam Co., Ltd.	Sale and maintenance of test instruments, etc.	100.0	100.0
	Quantel Global Sdn. Bhd.	Sale and maintenance of test instruments, etc.	100.0	100.0
	Quantel Global Philippines Corporation	Sale and maintenance of test instruments, etc.	100.0	100.0
	Quantel Global Company Limited	Sale and maintenance of test instruments, etc.	99.9	-	Note 6
Chroma ATE Europe B.V.	Chroma Germany GmbH	Sale and maintenance of electronic test instruments, etc.	100.0	100.0
Chroma Investment Co., Ltd.	Testar Electronics Corporation	Testing of LED	15.0	15.0
					(Concluded)

• Note 1: The Corporation and the Corporation's subsidiary, Chroma ATE Inc., held 75% equity interest in Chroma Systems Solutions, Inc.
• Note 2: To improve financial structure and enrich working capital, the Corporation's subsidiary, Chroma Japan Corp., increased its capital by \$54,626 thousand in April 2020. The Corporation's board of directors resolved to participate in the capital injection. After the cash injection, the Group's equity remained the same.
• Note 3: To meet business needs, the Corporation's subsidiary, Innovative Nanotech Incorporated, increased its capital reserved for employees by \$11,640 thousand in April 2021. The Corporation did not participate in the capital injection and its equity interest in Innovative Nanotech Incorporated decreased to 67.2%.
• Note 4: For operational needs, the Corporation's subsidiary, Touch Cloud Inc., increased its working capital by \$60,000 thousand in May 2021. The Corporation's board of directors resolved to participate in the capital injection and its equity interest in Touch Cloud Inc. increased from 78.1% to 83.1% after the cash injection.
• Note 5: The Corporation's subsidiary, Wei Da Electric Vehicle Co., Ltd., had completed its liquidation procedures on October 15, 2020.
• Note 6: To expand its sales network in Southeast Asia, the Corporation's subsidiary Quantel Private Ltd. resolved to set up Quantel Global Company Limited. in 2021, which engaged in the sale of test instruments.

13. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

	December 31
	2021	2020
Investments in associates Investments in joint ventures	\$ 3,111,361 16,003	\$ 3,122,336 16,891
	\$ 3,127,364	\$ 3,139,227

a. Investments in associates

			December 31
		2021	2020
	Amount	Percentage of Equity Interest (%)	Amount	Percentage of Equity Interest (%)
Associates that are not individually material
Adlink Technology Inc.	\$ 284,189	11.2	\$ 514,751	11.3
Dynascan Technology Corp.	152,662	27.3	141,439	27.3
Camtek Ltd.	2,674,510	17.8	2,466,146	18.1
	\$ 3,111,361		\$ 3,122,336
			For the Year Ended	December 31
			2021	2020
The Group's share of:
Net profit		\$	305,017	\$ 136,122
Other comprehensive loss			(74,891)	(136,588)

Fair values (Level 1) of investments in associates with available published price quotations are summarized as follows:

Total comprehensive income (loss) for the year \$ 230,126 \$ (466)

	December 31
Name of Associate	2021	2020
Adlink Technology Inc.	\$ 1,583,210	\$ 1,552,809
Camtek Ltd.	\$ 9,962,445	\$ 4,878,058

Although the Corporation's equity interest in Camtek Ltd. fell below 20% in 2020, after assessing the Corporation's number of seats in the board of directors of Camtek Ltd., it still has a significant influence; therefore, Camtek Ltd. is still regarded as an associate.

The Group is able to exercise significant influence over Adlink Technology Inc. although the percentage of shares held is less than 20%. Therefore, the Group accounted for Adlink Technology Inc. as an associate.

Refer to Table 8 "Information on Investees" for the nature of activities, principal place of business and country of incorporation of the associates.

Except for Adlink Technology Inc., the investments in associates accounted for using the equity method and the share of profit or loss and other comprehensive income of those investments were calculated based on financial statements which have been audited. Management believes there is no material impact on the equity method accounting or the calculation of the share of profit or loss and other comprehensive income from the financial statements of Adlink Technology Inc., which have not been audited.

b. Investments in joint ventures

	December 31
	2021			2020
	Amount	Percentage of Equity Interest (%)	Amount	Percentage of Equity Interest (%)
Joint ventures that are not individually material Chih Ho Shun Development Co.,
Ltd.	\$ 16,003	35.0	\$ 16,891	35.0

Aggregate information of joint ventures that are not individually material:

		For the Year Ended December 31
	2021	2020
The Group's share of:
Net loss	\$ (888)	\$ (730)
Other comprehensive income	-	-
Total comprehensive loss for the year	\$ (888)	\$ (730)

For the investment and development plan, "The Action Plan for Developing Land Surrounding the MRT Airport Station to Improve Civilians' Life," the board of directors resolved to invest jointly with Dynapack International Corporation and Heran Co., Ltd. to set up Chih Ho Shun Development Co., Ltd. ("Chih Ho Shun") on February 21, 2012. The Corporation invested for a 35% entity interest in Chih Ho Shun but did not have control over this investee.

Refer to Table 8 "Information on Investees" for the nature of activities, principal place of business and country of incorporation of the joint ventures.

The investments in joint ventures accounted for using the equity method and the share of profit or loss and other comprehensive income of the investment for the years ended December 31, 2021 and 2020 was based on the joint ventures' financial statements which have been audited.

14. PROPERTY, PLANT AND EQUIPMENT

		Office
	Land	Buildings	Machinery	Equipment	Total
Cost
Balance, January 1, 2020 Additions Disposals Reclassification Exchange differences	\$ 1,209,760 - - - (2,765)	\$ 2,568,672 17,981 (45) 3,195 (8,428)	\$ 803,326 38,712 (32,358) (7,631) (1,721)	\$ 1,834,589 129,896 (207,994) 113,093 6,514	\$ 6,416,347 186,589 (240,397) 108,657 (6,400)
Balance, December 31, 2020	\$ 1,206,995	\$ 2,581,375	\$ 800,328	\$ 1,876,098	\$ 6,464,796
Accumulated depreciation Balance, January 1, 2020 Depreciation Disposals Reclassification Exchange differences	\$ - - - - -	\$ 1,245,717 90,579 (41) 2,512 (1,228)	\$ 654,099 61,897 (32,232) (18,541) (2,799)	\$ 1,295,100 171,799 (173,249) 8,361 6,188	\$ 3,194,916 324,275 (205,522) (7,668) 2,161
Balance, December 31, 2020	\$ -	\$ 1,337,539	\$ 662,424	\$ 1,308,199	\$ 3,308,162
Carrying value at December 31, 2020	\$ 1,206,995	\$ 1,243,836	\$ 137,904	\$ 567,899	\$ 3,156,634
Cost
Balance, January 1, 2021 Additions Disposals Reclassification Exchange differences	\$ 1,206,995 - (425,072) 2,519 (3,450)	\$ 2,581,375 3,926 (1,603,593) 4,067,304 (15,650)	\$ 800,328 27,886 (82,288) 73,166 (2,566)	\$ 1,876,098 78,948 (199,003) 2,373 (17,554)	\$ 6,464,796 110,760 (2,309,956) 4,145,362 (39,220)
Balance, December 31, 2021	\$ 780,992	\$ 5,033,362	\$ 816,526	\$ 1,740,862	\$ 8,371,742
Accumulated depreciation
Balance, January 1, 2021 Depreciation Disposals Reclassification Exchange differences	\$ - - - - -	\$ 1,337,539 195,336 (940,419) 18,602 (2,908)	\$ 662,424 65,668 (76,090) (2,558) (2,011)	\$ 1,308,199 194,555 (186,872) (285,682) (10,477)	\$ 3,308,162 455,559 (1,203,381) (269,638) (15,396)
Balance, December 31, 2021	\$ -	\$ 608,150	\$ 647,433	\$ 1,019,723	\$ 2,275,306
Carrying value at December 31, 2021	\$ 780,992	\$ 4,425,212	\$ 169,093	\$ 721,139	\$ 6,096,436

The Corporation's board of directors resolved to sell the land and plant in Hwa Ya Technology Park to its related party, Adlink Technology, on July 3, 2020. The transaction price, which amounted to \$3,080,000 thousand, was determined with reference to the appraisal results of independent real estate appraisers. The transaction was settled on the first quarter of 2021. In addition, the Group sold and leased back a portion of assets for 5 years for operational needs. The transaction resulted in a total acquisitions of right-of-use assets of \$180,053 thousand and lease liabilities of \$221,956 thousand, refer to Note 29 for related information.

The Corporation completed the relocation of its A7 office building in the first quarter of 2021, which was constructed by the Corporation and transferred the related buildings from prepaid land and equipment to property, plant and equipment.

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

15-51 years
5-20 years
3-11 years
1-49 years
1-12 years
1-10 years

Refer to Note 30 for property, plant and equipment that have been pledged to secure borrowings of the Group.

15. LEASE ARRANGEMENTS

The Group's important lease projects include lease land from other companies and government department for the use of the plants, warehouses and parking spaces, as well as leases of information systems cloud services, etc. The lease terms are from 2 to 10 years. The Group does not have bargain purchase options to acquire lease items at the end of lease terms.

For the years ended December 31, 2021 and 2020, the right-of-use assets increased by \$351,636 thousand and \$102,879 thousand, the depreciation expense was \$116,475 thousand and \$103,734 thousand, and the total cash outflow for leases was \$284,620 thousand and \$175,874 thousand, respectively. Refer to the consolidated balance sheets for the balance of right-of-use assets and lease liabilities.

16. INVESTMENT PROPERTIES

		December 31
	2021	2020
Land	\$ 3,137,187	\$ 3,137,187

The Group acquired the land ownership certificates of the investment and development plan, "The Action Plan of Developing Land Surrounding the Airport MRT Station to Improve Civilian's Life" in the third quarter of 2018, part of the land was co-constructed with Fu Yu Construction to build a joint building project, and part of it has not yet been decided, both of the above land were classified as investment properties. The determination of fair value was performed by independent qualified professional valuers, and the fair value was measured by using Level 3 inputs. The valuation was arrived at by reference to market evidence of transaction prices for similar properties. The significant unobservable inputs used include discount rates and the fair value as appraised.

		December 31
	2021	2020
Fair value	\$ 11,830,879	\$ 11,754,551

In the third quarter of 2019, the Group entered into a joint building contract with Fu Yu Construction Co., Ltd. (Fu Yu Construction) to jointly build a building located at Project No 61-0 and Project No 61-1 projects, Lejie section, Guishan District, Taoyuan City. The construction project adopts a jointly constructed manner. The Group provided the lands and Fu Yu Construction provided fund to construct. The area will be distributed to the Group and Fu Yu Construction for 47% and 53%, respectively. According to the joint building contract, Fu Yu Construction should pay \$20,000 thousand (recognized as guarantee deposit received) and two guaranteed notes with a denomination of \$120,000 thousand to the Group when signing the contract. Additional \$20,000 thousand guarantee deposit should be paid within five business days after the building construction registration is approved and within five business days after the approval of underground bottom plate inspection. The joint building project started in the fourth quarter of 2020.

17. GOODWILL

	For the Year Ended December 31
	2021	2020
Cost
Balance, beginning of the year Net effect of exchange differences	\$ 228,002 (2,307)	\$ 225,996 2,006
Balance, end of the year	\$ 225,695	\$ 228,002

For assessing goodwill for impairment at the end of reporting period, the Group took value in use as basis for calculating the recoverable amount of goodwill. The Group used the cash flows of a five-year financial forecast as the basis for calculating value in use to reflect the specific risk of cash-generating units.

The Group did not recognize any impairment loss on goodwill for the years ended December 31, 2021 and 2020.

18. BORROWINGS

a. Short-term borrowings

	December 31
	2021	2020
Secured bank loans Unsecured bank loans	\$ 391,210 1,509,900	\$ 205,020 2,349,240
	\$ 1,901,110	\$ 2,554,260

As of December 31, 2021 and 2020, the interest rate on the bank loans was 0.52%-1.93% and 0.52%-4.75% per annum, respectively.

b. Long-term borrowings

	December 31
	2021	2020
Secured bank loans (1) (Note 30)	\$ 210,222	\$ 488,072
Unsecured bank loans (2)	1,450,000	2,550,000
Less: Current portions	1,660,222 213,053	3,038,072 633,456
Long-term borrowings	\$ 1,447,169	\$ 2,404,616

• 1) Secured by the Group's financial assets amortized at cost, debt investments with no active market and property, plant and equipment. The final repayment period of those bank loans will be due in April 2025 to June 2031. As of December 31, 2021 and 2020, the effective interest rates on the bank loans were 2.25%-3.50% and 0.85%-4.99% per annum, respectively.
• 2) The bank loans are for the purpose of general operation with due date in June 2026. As of December 31, 2021 and 2020, the interest rates on the bank loans were 0.68%-0.83% and 0.69%-0.89% per annum, respectively.

19. OTHER PAYABLES

	December 31
	2021	2020
Salaries and bonus	\$ 533,300	\$ 477,324
Employee's compensation	463,925	416,569
Remuneration of directors	11,460	10,670
Others	364,013	306,435
	\$ 1,372,698	\$ 1,210,998

20. RETIREMENT BENEFIT PLANS

a. Defined contribution plans

The Corporation and its subsidiaries in the ROC adopted a pension plan under the Labor Pension Act (LPA), which is a state-managed defined contribution plan. Under the LPA, an entity makes monthly contributions to employees' individual pension accounts at 6% of monthly salaries and wages.

Employees of the Group's subsidiaries in the People's Republic of China, USA, Europe, Singapore, Japan and branches in Korea are under the retirement benefit plans operated by their respective local governments. Subsidiaries have to contribute amounts at certain percentages of salaries to the retirement benefit plans to fund the benefits. The only obligation of the Group with respect to the retirement benefit plan is to make the specified contributions.

b. Defined benefit plans

The defined benefit plans adopted by the Corporation and its subsidiaries, Chroma New Material Corp. and Adivic Technology Co., Ltd. in accordance with the Labor Standard Law is operated by the government of the ROC. Pension benefits are calculated on the basis of length of service and average monthly salaries of the 6 months before retirement. The Corporation and its subsidiaries mentioned above contribute amount equal to 4% of total monthly salaries and wages to a pension fund administered by the pension fund monitoring committee. Pension contributions are deposited in the Bank of Taiwan in the committee's name. Before the end of year, the Corporation and its subsidiaries assess the balance in the pension fund. If the amount of the balance in the pension fund is inadequate to pay retirement benefits for employees who conform to retirement requirements in the next year, the Corporation and its subsidiaries are required to fund the difference in one appropriation that should be made before the end of March of the next year. The pension fund is managed by the Bureau of Labor Funds, Ministry of Labor (the "Bureau"); the Group has no right to influence the investment policy and strategy.

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

	December 31
	2021	2020
Present value of defined benefit obligation	\$ 538,051	\$ 496,002
Fair value of plan assets	(364,082) 173,969	(339,722) 156,280
Net defined benefit assets (recognized in other non-current assets)	920	-
Net defined benefit liabilities	\$ 174,889	\$ 156,280

Movements in net defined benefit liabilities were as follows:

	Present Value of the Defined Benefit Obligation	Fair Value of the Plan Assets	Net Defined Benefit Liabilities
Balance at January 1, 2020 Current service cost	\$ 486,655 3,601	\$ (323,566) -	\$ 163,089 3,601
Net interest expense (income)	3,663	(2,489)	1,174
Recognized in profit or loss Remeasurement	7,264	(2,489)	4,775
Return on plan assets (excluding amounts included in net interest) Actuarial loss	-	(10,566)	(10,566)
Changes in demographic assumptions	118	-	118
Changes in financial assumptions	13,954	-	13,954
Experience adjustments	1,752	-	1,752
Recognized in other comprehensive income	15,824	(10,566)	5,258
Contributions from employer	-	(16,842)	(16,842)
Benefits paid	(13,741)	13,741	-
Balance at December 31, 2020	496,002	(339,722)	156,280
Current service cost	3,381	-	3,381
Net interest expense (income)	2,454	(1,741)	713
Recognized in profit or loss	5,835	(1,741)	4,094
Remeasurement
Return on plan assets (excluding amounts
included in net interest) Actuarial loss	-	(4,327)	(4,327)
Changes in demographic assumptions	15,272	-	15,272
Experience adjustments	29,230	-	29,230
Recognized in other comprehensive income	44,502	(4,327)	40,175
Contributions from employer	-	(26,580)	(26,580)
Benefits paid	(8,288)	8,288	-
Balance at December 31, 2021	\$ 538,051	\$ (364,082)	\$ 173,969

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

• 1) Investment risk: The plan assets are invested in domestic and foreign equity and debt securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau or under the mandated management. However, in accordance with relevant regulations, the return generated by plan assets should not be below the interest rate for a 2-year time deposit with local banks.
• 2) Interest risk: A decrease in the government bond interest rate will increase the present value of the defined benefit obligation; however, this will be partially offset by an increase in the return on the plan's debt investments.
• 3) Salary risk: The present value of the defined benefit obligation is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the present value of the defined benefit obligation.

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

	December 31
	2021	2020
Discount rate(s)	0.38%-0.50%	0.38%-0.50%
Expected rate(s) of salary increase	1.50%-2.50%	1.50%-2.50%

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

	December 31
	2021	2020
Discount rate(s)
0.25% increase	\$ (14,093)	\$ (13,864)
0.25% decrease	\$ 14,640	\$ 14,427
Expected rate(s) of salary increase
0.25% increase	\$ 14,124	\$ 13,913
0.25% decrease	\$ (13,673)	\$ (13,446)

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

	December 31
	2021	2020
Expected contributions to the plan for the next year	\$ 31,035	\$ 16,762
Average duration of the defined benefit obligation	10.7 years	11.7 years

21. EQUITY

a. Ordinary share capital

		December 31
	2021	2020
Number of shares authorized (in thousands) Shares authorized Number of shares issued and fully paid (in thousands) Shares issued	500,000 \$ 5,000,000 421,875 \$ 4,218,745	500,000 \$ 5,000,000 421,295 \$ 4,212,945

The authorized shares include 30,000 thousand shares allocated for the exercise of employee share options. The change in the Corporation's share capital is mainly due to the exercise of employee share options and the cancellation of employee restricted shares.

b. Capital surplus

		December 31
	2021	2020
May be used to offset a deficit, distributed as cash dividends, or transferred to share capital (Note)
Additional paid-in capital Treasury share transactions Consolidation excess	\$ 3,372,101 218,317 146,976	\$ 3,331,004 210,193 146,976
May be used to offset a deficit only
Additional paid-in capital Share of changes in capital surplus of associates or joint ventures	341,296	327,868
May not be used for any purpose
Employee share options Employee restricted shares	8,533 -	16,060 4,774
	\$ 4,087,223	\$ 4,036,875

Note: Such capital surplus may be used to offset a deficit; in addition, when the Corporation has no deficit, such capital surplus may be distributed as cash dividends or transferred to share capital (limited to a certain percentage of the Corporation's capital surplus and once a year).

c. Retained earnings and dividend policy

Under the dividend policy as set forth in the Corporation's Articles of Incorporation (the "Articles"), where the Corporation made profit in a fiscal year, the profit shall be first utilized for paying taxes, offsetting losses of previous years, setting aside as legal reserve 10% of the remaining profit, setting aside or reversing special reserve in accordance with the laws and regulations, and then any remaining profit together with any undistributed retained earnings shall be used by the Corporation's board of directors as the basis for proposing a distribution plan, which should be resolved in the shareholders' meeting for distribution of dividends and bonus to shareholders. For the abovementioned distribution of earnings, the board of directors was authorized to adopt a special resolution to distribute dividends and bonuses in cash and a report of such distribution should be submitted in the shareholders' meeting. For the policies on distribution of employees' compensation and remuneration to directors, refer to d. employees' compensation and remuneration of directors in Note 23.

Taking into account future capital expenditure requirements and its cash position, the total of cash dividends paid in any given year may not be less than 20% of total dividends distributed in that year. The final amount, type and percentage of the cash dividends and stock dividends are subject to actual earnings and capital requirements of the Corporation in a particular year.

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

Items referred to under Rule No. 1010012865 and Rule No. 1010047490 issued by the FSC and in the directive titled "Questions and Answers for Special Reserves Appropriated Following Adoption of IFRSs" should be appropriated to or reversed from a special reserve by the Corporation. However, the Corporation is in compliance with Rule No. 1090150022, which was issued by the FSC on March 31, 2021. Rule No. 1010012865 and Rule No. 1010047490 were annulled on December 31, 2021 and March 31, 2021, respectively.

The appropriations of earnings for 2020 and 2019 have been approved in the annual shareholders' meeting on August 18, 2021 and June 10, 2020, respectively, were as follows:

	Appropriation of Earnings		Dividend Per Share (NT\$)
	For Fiscal Year 2020		For Fiscal Year 2019		For Fiscal Year 2020		For Fiscal Year 2019
Legal reserve	\$ 231,823	\$	185,448
Special reserve	-		89,240
Reversal of special reserve	(89,240)		-
Cash dividends	1,897,175		1,265,000	\$	4.5	\$	3.0

The appropriations of earnings for 2021 had been proposed by the Corporation's board of directors on February 23, 2022. The appropriations and dividends per share were as follows:

	Appropriation of Earnings	Dividends Per Share (NT\$)
Legal reserve	\$ 413,498
Cash dividends	2,970,000	\$7.0

The aforementioned cash dividends had been resolved by the Corporation's board of directors, and the rest is subject to the resolution of the shareholders in their meeting to be held on June 9, 2022.

d. Special reserves

If a special reserve appropriated on the first-time adoption of IFRSs relates to exchange differences on translation of the financial statements of foreign operations (including the subsidiaries of the Corporation), the special reserve will be reversed on a proportionate basis according to the Corporation's disposal of foreign operations; on the Corporation's loss of significant influence, however, the entire special reserve will be reversed. Additional special reserve should be appropriated for the amount equal to the difference between net debit balance reserves and the special reserve appropriated on the first-time adoption of IFRSs. Any special reserve appropriated may be reversed to the extent that the net debit balance reverses and, thereafter, distributed.

e. Other equity items

	Exchange Differences on Translating Foreign Operations	Unrealized Gain (Loss) on Financial Assets at FVTOCI	Unearned Employee Benefit
For the year ended December 31, 2021
Balance at January 1, 2021 Exchange differences on translating foreign operations	\$ (466,042) (67,435)	\$ 384,493 -	\$ (552) -
Unrealized gain arising from equity investment Share of other comprehensive loss of	-	298,132	-
associates accounted for using the equity method Disposal of investments accounted for using	(70,628)	(3,960)	-
the equity method Share-based payment transaction	64 -	9 -	- 552
Balance at December 31, 2021	\$ (604,041)	\$ 678,674	\$ -
For the year ended December 31, 2020
Balance at January 1, 2020 Exchange differences on translating foreign	\$ (331,073)	\$ 154,946	\$ (11,524)
operations Unrealized loss arising from equity	1,115	-	-
investment Share of other comprehensive loss of	-	229,747	-
associates accounted for using the equity method	(136,092)	(200)	-
Disposal of investments accounted for using the equity method Share-based payment transaction	8 -	- -	- 10,972
Balance at December 31, 2020	\$ (466,042)	\$ 384,493	\$ (552)

f. Non-controlling interests

	For the Year Ended December 31
	2021	2020
Balance, beginning of the year	\$ 325,470	\$ 296,699
Share of non-controlling interests
Net profit	126,083	57,181
Exchange difference on translating the financial statements of
foreign entities	(9,397)	(10,879)
Remeasurement on defined benefit plans	238	(6)
Cash dividends distributed by subsidiaries	(30,493)	(17,545)
Change in equity from issuance of ordinary shares by
subsidiaries	21,646	-
Share-based transaction payment by subsidiary	-	20
Balance, end of the year	\$ 433,547	\$ 325,470

g. Treasury shares

The Corporation's shares held by its subsidiary, Chroma Investment Co., Ltd., at the end of the reporting periods were as follows:

	December 31
	2021	2020
Number of shares held (in thousands of shares) Carrying amount	1,806 \$ 33,686	1,806 \$ 33,686
Market price	\$ 361,116	\$ 303,337

Forfeited employee restricted shares of 123 thousand were returned to the Corporation and canceled during 2020.

Under the Securities and Exchange Act, the Corporation shall neither pledge treasury shares nor exercise shareholders' rights on these shares, such as the rights to dividends and to vote. The subsidiaries holding treasury shares, however, retain shareholders' rights, except the rights to participate in any share issuance for cash and to vote.

22. REVENUE

	For the Year Ended December 31
	2021	2020
Revenue from contracts with customers
Revenue from sale of goods	\$ 16,359,671	\$ 14,596,222
Construction contract revenue	780,206	617,812
Other revenue	444,146	318,509
	\$ 17,584,023	\$ 15,532,543

a. Contract balances

	December 31
	2021	2020
Contract assets - construction contract (1)	\$ 779,547	\$ 1,278,936
Contract liabilities - sale of goods (1) Contract liabilities - construction contract (1) Contract liabilities - advance receipts for real estate (2)	\$ 731,744 15,202 -	\$ 430,039 27,643 308,000
	\$ 746,946	\$ 765,682

• 1) The changes in the balance of contract liabilities primarily result from the timing difference between the Group's performance and respective customer's payment.
• 2) Refer to Notes 14 and 29 for related information.
• b. Disaggregation of revenue

Refer to Note 36 for the information on disaggregation of revenue.

23. ADDITIONAL INFORMATION ON EXPENSES

a. Finance costs

		For the Year Ended December 31
	2021	2020
Interest on borrowings Interest on lease liabilities	\$ 38,522 6,216	\$ 53,552 5,259
	\$ 44,738	\$ 58,811

b. Depreciation and amortization

	For the Year Ended December 31
	2021	2020
An analysis of depreciation by function
Operating costs	\$ 114,977	\$ 80,065
Operating expenses	457,057	347,944
	\$ 572,034	\$ 428,009
An analysis of amortization by function
Operating costs	\$ 85	\$ -
Operating expenses	21,950	11,225
	\$ 22,035	\$ 11,225

c. Employee benefits expense

	For the Year Ended December 31
	2021	2020
Short-term benefits	\$ 3,862,080	\$ 3,269,024
Share-based payments	1,415	16,968
Post-employment benefits
Defined contribution plans	100,444	99,034
Defined benefit plans (Note 20)	4,094	4,775
Other employee benefits	78,052	58,776
	\$ 4,046,085	\$ 3,448,577
An analysis of employee benefits expense by function
Operating costs Operating expenses	\$ 646,588 3,399,497	\$ 418,257 3,030,320
	\$ 4,046,085	\$ 3,448,577

d. Employees' compensation and remuneration of directors

According to the Article of Incorporation of the Corporation, the Corporation accrues employees' compensation and remuneration of directors at the rates of 5%-20% and no higher than 1.5%, respectively, of net profit before income tax, employees' compensation, and remuneration of directors. The employees' compensation and remuneration of directors for the years ended December 31, 2021 and 2020, which have been approved by the Corporation's board of directors on February 23, 2022 and February 25, 2021, respectively, were as follows:

		For the Year Ended December 31
	2021		2020
	Amount	Rate %	Amount	Rate %
Employees' compensation	\$ 415,047	7.73	\$ 383,845	12.04
Remuneration of directors	9,600	0.18	9,600	0.30

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

There is no difference between the actual amounts of the employees' compensation and remuneration of directors paid and the amounts recognized in the consolidated financial statements for the years ended December 31, 2021 and 2020.

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

24. INCOME TAXES

a. Major components of income tax expense recognized in profit or loss

	For the Year Ended December 31
	2021	2020
Current tax
In respect of the current year	\$ 637,807	\$ 539,734
Land value incremental tax	200,196	-
Income tax on unappropriated earnings	15,982	15,222
Adjustments for prior years	10,384	(42,936)
	864,369	512,020
Deferred tax
In respect of the current year	114,162	136,030
Income tax expense recognized in profit or loss	\$ 978,531	\$ 648,050

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

		For the Year Ended December 31
	2021	2020
Profit before tax	\$ 5,283,846	\$ 3,029,007 (Continued)

	For the Year Ended December 31
	2021	2020
Income tax expense calculated at the statutory rate Adjustment items in determining taxable income	\$ 1,206,760	\$ 721,364
Tax-exempt income	(350,591)	(25,157)
Others	(9,437 )	32,663
Unrecognized deductible differences
Investment credits	(119,301)	(81,554)
Loss carryforward	(23,256)	(5,121)
Deductible temporary differences	46,654	34,600
Other taxable items
Land value incremental tax	200,196	-
Income tax on unappropriated earnings	15,982	15,222
Difference on basic tax payable	-	990
Others	176	77
Adjustments for prior years' tax	10,384	(42,936)
Temporary differences	193	(2,646)
Others	771	548
Income tax expense recognized in profit or loss	\$ 978,531	\$ 648,050
		(Concluded)

b. Deferred tax assets and liabilities

For the year ended December 31, 2021

Deferred Tax Assets	Opening Balance	Recognized in Profit or Loss	Exchange Differences and Other	Closing Balance
Unrealized intercompany gain	\$ 112,022	\$ 16,560	\$ -	\$ 128,582
Loss carry forwards	63,876	7,607	(1,567)	69,916
Inventory reserve	59,507	760	-	60,267
Allowance for impaired
receivables	27,067	5,650	(6)	32,711
Tax credit	29,186	4,190	(869)	32,507
Unrealized exchange loss	11,645	(2,748)	-	8,897
Gain on disposal of assets	-	3,853	-	3,853
Net defined benefit liability	3,775	(3,775)	-	-
Others	7,909	762	(66)	8,605
	\$ 314,987	\$ 32,859	\$ (2,508)	\$ 345,338
Deferred Tax Liabilities	Opening Balance	Recognized in Profit or Loss	Exchange Differences and Other	Closing Balance
Unappropriated earnings of
foreign subsidiaries	\$ 566,002	\$ 135,236	\$ -	\$ 701,238
Goodwill	46,598	2,606	(377)	48,827
Others	8,511	9,179	(333)	17,357
	\$ 621,111	\$ 147,021	\$ (710)	\$ 767,422

For the year ended December 31, 2020

Deferred Tax Assets	Opening Balance	Recognized in Profit or Loss	Exchange Differences and Other	Closing Balance
Unrealized intercompany gain	\$ 120,426	\$ (8,404)	\$ -	\$ 112,022
Loss carry forwards	75,343	(8,568)	(2,899)	63,876
Inventory reserve	51,667	7,840	-	59,507
Tax credit	24,298	6,333	(1,445)	29,186
Allowance for impaired
receivables	22,735	4,342	(10)	27,067
Unrealized exchange loss	10,385	1,260	-	11,645
Net defined benefit liability	6,203	(2,428)	-	3,775
Others	6,512	2,114	(717)	7,909
	\$ 317,569	\$ 2,489	\$ (5,071)	\$ 314,987
Deferred Tax Liabilities	Opening Balance	Recognized in Profit or Loss	Exchange Differences and Other	Closing Balance
Unappropriated earnings of
foreign subsidiaries	\$ 445,017	\$ 120,985	\$ -	\$ 566,002
Goodwill	32,570	15,604	(1,576)	46,598
Others	6,560	1,930	21	8,511
	\$ 484,147	\$ 138,519	\$ (1,555)	\$ 621,111

c. Information about unused loss carryforwards

	December 31
	2021	2020
Unrecognized as deferred tax assets
Expiry in 2021	\$ -	\$ 68,584
Expiry in 2022	65,509	109,443
Expiry in 2023	37,175	60,909
Expiry in 2024	41,557	54,928
Expiry in 2025	92,125	92,125
Expiry in 2026	112,300	112,300
Expiry in 2027	79,327	79,327
Expiry in 2028	72,772	72,735
Expiry in 2029	75,091	75,039
Expiry in 2030	57,771	40,123
Expiry in 2031	17,134	-
	650,761	765,513
Recognized as deferred tax assets
Expiry in 2033	23,882	46,150
Expiry in 2034	23,587	24,268
Expiry in 2036	15,483	15,930
Expiry in 2038	53,843	55,399
Expiry in 2039	131,993	135,808
Expiry in 2040	13,140	-
	261,928	277,555
	\$ 912,689	\$ 1,043,068

d. Income tax assessments

The Corporation's tax returns through 2019 had been assessed by the tax authorities.

The income tax returns through 2020 of the Corporation's subsidiary - Touch Cloud Inc., have been assessed by the tax authorities.

The income tax returns through 2019 of the Corporation's subsidiaries - Chroma New Material Corp., Mas Automation Corp., Testar Electronics Corporation, Adivic Technology Co., Ltd., Chroma Investment Co., Ltd., Innovative Nanotech Incorporated, and EVT Technology Co., Ltd. have been assessed by the tax authorities.

25. EARNINGS PER SHARE

The earnings and weighted average number of ordinary shares outstanding used in the computation of earnings per share are as follows:

Net Profit for the Year

	For the Year Ended December 31
	2021	2020
Earnings used in the computation of basic and diluted earnings per share	\$ 4,179,232	\$ 2,323,776
Shares		(In Thousands of Shares)
		For the Year Ended December 31
	2021	2020
Weighted average number of ordinary shares used in the
computation of basic earnings per share Effect of potentially dilutive ordinary shares:	419,790	417,761
Employees' compensation	2,250	2,575
Employee share options	621	1,248
Employee restricted shares	-	46
Weighted average number of ordinary shares used in the
computation of diluted earnings per share	422,661	421,630

If the Group offered to settle compensation paid to employees in cash or shares, the Group assumed the entire amount of the compensation would be settled in shares and the resulting potential shares were included in the weighted average number of shares outstanding used in the computation of diluted earnings per share, as the effect is dilutive. Such dilutive effect of the potential shares is included in the computation of diluted earnings per share until the number of shares to be distributed to employees is resolved in the following year.

26. SHARE-BASED PAYMENT ARRANGEMENTS

a. Employee share option plan of the Corporation

The Corporation had not granted employee share options for the years ended December 31, 2021 and 2020. Information on employee share options is as follows:

	For the Year Ended December 31
	2021		2020
	Number of Options (In Thousands)	Weighted average Exercise Price (NT\$)	Number of Options (In Thousands)	Weighted average Exercise Price (NT\$)
Balance at January 1	1,238	\$ 58.7	3,136	\$ 59.8
Options exercised Options forfeited	(580) -	58.1 -	(1,892) (6)	59.5 -
Balance at December 31	658	57.3	1,238	58.7
Options exercisable, end of the year	658		1,238

Information on outstanding options as of December 31, 2021 and 2020 is as follows:

December 31
	2021		2020
Range of Exercise Price (NT\$)	Weighted-average Remained Contractual Life (Years)	Range of Exercise Price (NT\$)	Weighted-average Remained Contractual Life (Years)
\$ 57.3	0.24	\$ 58.7	1.24

Compensation cost recognized was \$2,646 thousand for the year ended December 31, 2020.

b. Employee share option plan of subsidiaries

Adivic Technology Co., Ltd. granted its employees share options of 1,360 thousand units on March 12, 2014, with each option eligible to subscribe for one common share of Adivic Technology Co., Ltd. when exercised. The options are valid for 8 years and exercisable at certain percentages subsequent to the second year of the grant date.

	For the Year Ended December 31
	2021		2020
	Number of Options (In Thousands)	Weighted average Exercise Price (NT\$)	Number of Options (In Thousands)	Weighted average Exercise Price (NT\$)
Balance at January 1 Options forfeited	625 -	\$ 10.00 -	785 (160)	\$ 10.00 10.00
Balance at December 31	625	10.00	625	10.00
Options exercisable, end of the year	625		625

The qualified employees of Touch Cloud Inc. were granted 470 thousand units of share options in April 2020, each option entitled the holders to subscribe for one common share of Touch Cloud Inc. upon exercised. The options granted are valid for 5 years and exercisable at certain percentages from the second anniversary of the grant date. The exercise price is \$10 per share according to the terms of the employee stock option plan.

Information on employee share options is as follows:

	For the Year Ended December 31
	2021		2020
	Number of Options (In Thousands)	Weighted average Exercise Price (NT\$)	Number of Options (In Thousands)	Weighted average Exercise Price (NT\$)
Balance at January 1	470	\$ 10.00	-	\$ -
Options granted	-	-	470	10.00
Options forfeited	(132)	10.00	-	-
Balance at December 31	338	10.00	470	10.00
Options exercisable, end of the year	-		-

The above-mentioned employee stock options used Black-Scholes model to determine the fair value of the options. The valuation assumptions on the grant date were as follows:

	April 2020
Grant-date share price	\$3.71
Exercise price	\$10
Expected volatility	36.64%-38.24%
Expected life (in years)	3.5-4.5
Expected dividend yield	-
Risk-free interest rate	0.39%-0.42%

c. Restricted shares for employees

In the shareholders' meeting on June 7, 2016, the shareholders approved a Restricted Share Unit Plan ("RSU" Plan) for employees with a total amount of \$36,000 thousand, consisting of 3,600 thousand shares with issuance price of \$10 dollars per share. It can be issued at one time or several times depending on the circumstance. The RSU Plan is approved under Rule No. 1050024381 issued by the FSC on June 27, 2016. The Corporation issued 3,100 thousand and 185 thousand shares on July 8, 2016 and June 20, 2017, the subscription date. The details of RSU Plan are as follows:

1) Employees who are granted RSUs, upon meeting the Corporation's financial performance and personal performance indicators, are eligible to be vested 10, 20, 30 and 40 percent of the RSUs granted after 1, 2, 3 and 4 years of tenure after the subscription date, respectively.

• 2) The restrictions on the rights of the employees who are granted RSUs but have not met the vesting conditions are as follows:
• a) The employees are not eligible to sell, pledge, transfer, donate or to dispose any RSUs in any form.
• b) The employees holding RSUs are entitled to receive dividends and similar purchasing rights to ordinary shares during capital increase. Dividends from RSUs are not restricted during the vesting period and are appropriated to the employees' personal account from trust account after the dividend distribution date.
• c) Before the restricted shares are vested to the employees, the right of attendance, proposal, speech, voting and other rights of shareholders are acted by the custodian.
• d) The RSUs should be delivered to trust custodians upon grant date. The employees cannot request for return in any manner before vesting conditions are met.
• 3) If an employee fails to meet the vesting conditions, the Corporation will recall or buy back and cancel the restricted shares at issued price. If an employee voluntarily resigns, retires, disabled or decease due to occupational hazards, dismissed, be transferred to another post, violates labor contracts or working protocols substantially or abandons restricted shares, related guidelines of RSU Plan will be followed accordingly.

Information relating to outstanding employee restricted shares was as follows:

		For the Year Ended December 31
	2021	2020
Restricted shares at the beginning of the year	52	1,285
Shares vested	(52)	(1,110)
Shares canceled	-	(123)
Restricted shares at the end of the year	-	52

Compensations costs of share-based payment arising from the RSU Plan were \$1,415 thousand and \$14,302 thousand for the years ended December 31, 2021 and 2020, respectively.

27. CAPITAL MANAGEMENT

The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns while maximizing the return to shareholders through the optimization of the debt and equity balance. The Group's capital management aims to maintain the sufficiency of financial resources and the soundness of operating strategies to meet the needs for operating capital, capital expenditure, R&D expenses, debt handling, dividend disbursement, etc.

28. FINANCIAL INSTRUMENTS

a. Fair value of financial instruments not measured at fair value

Management believes the carrying amounts of financial assets and financial liabilities not measured at fair value recognized in the consolidated financial statements approximates their fair values.

• b. Fair value of financial instruments measured at fair value on a recurring basis
• 1) Fair value hierarchy

	Level 1	Level 2	Level 3	Total
December 31, 2021
Financial assets at FVTPL Domestic listed equity securities Domestic unlisted equity securities Open-end beneficiary certificates	\$ 6,643 - 445,082 \$ 451,725	\$ - - - \$ -	\$ - 53,224 4,793 \$ 58,017	\$ 6,643 53,224 449,875 \$ 509,742
Financial assets at FVTOCI Domestic listed ordinary shares and emerging markets shares Domestic unlisted equity securities Foreign unlisted equity securities	\$ 511,180 - - \$ 511,180	\$ - - - \$ -	\$ 502,085 136,548 17,079 \$ 655,712	\$ 1,013,265 136,548 17,079 \$ 1,166,892
December 31, 2020
Financial assets at FVTPL Domestic listed equity securities Domestic unlisted equity securities Open-end beneficiary certificates	\$ 4,763 - 445,422 \$ 450,185	\$ - - - \$ -	\$ - 58,830 4,646 \$ 63,476	\$ 4,763 58,830 450,068 \$ 513,661
Financial assets at FVTOCI Domestic listed ordinary shares and emerging markets shares Domestic unlisted equity securities Foreign unlisted equity securities	\$ 376,499 - - \$ 376,499	\$ - - - \$ -	\$ 347,474 131,196 7,729 \$ 486,399	\$ 723,973 131,196 7,729 \$ 862,898

There were no transfers between Levels 1 and 2 for the years ended December 31, 2021 and 2020.

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

For the year ended December 31, 2021

Financial Assets	Financial Assets at FVTPL Open-end Beneficiary Certificates	Financial Assets at FVTOCI Equity Instruments	Total
Balance at January 1, 2021	\$ 63,476	\$ 486,399	\$ 549,875
Purchase	-	15,750	15,750
Reduction of capital cash return	-	(9,660)	(9,660)
Recognized in profit or loss (included in
valuation gains and losses)	(5,459)	-	(5,459)
Recognized in other comprehensive income (included in unrealized gain on
financial assets at FVTOCI)	-	163,223	163,223
Balance at December 31, 2021	\$ 58,017	\$ 655,712	\$ 713,729

For the year ended December 31, 2020

	Financial Assets at FVTPL	Financial Assets
	Open-end	at FVTOCI
Financial Assets	Beneficiary Certificates	Equity Instruments	Total
Balance at January 1, 2020	\$ 4,762	\$ 204,569	\$ 209,331
Purchase	53,000	21,157	74,157
Recognized in profit or loss (included in valuation gains and losses)	5,714	-	5,714
Recognized in other comprehensive income (included in unrealized gain on
financial assets at FVTOCI)	-	260,673	260,673
Balance at December 31, 2020	\$ 63,476	\$ 486,399	\$ 549,875

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

The fair values of unlisted and domestic emerging market equity securities and open-end beneficiary certificates are determined by using the asset approach and the market approach. Asset approach evaluates the total market value of individual asset and liability of the evaluated target, taking into account the risk factors (lack of marketability, etc.) to estimate the fair value. Market approach refers to the transaction prices in active market of the listed companies engaging in similar business, related price multiplier, transaction and information implied by the transaction price, to arrive at the fair value.

c. Categories of financial instruments

	December 31
	2021	2020
Financial assets
Financial assets at FVTPL
Mandatorily at FVTPL	\$ 509,742	\$ 513,661
Financial assets at amortized cost (1)	9,154,450	8,439,251
Financial assets at FVTOCI
Equity instruments	1,166,892	862,898
Financial liabilities
Financial liabilities at amortized cost (2)	8,032,376	9,547,767

• 1) The balances include financial assets measured at amortized cost, which comprise cash and cash equivalents, financial assets measured at amortized cost, notes receivable, trade receivables, other receivables (classified as other current assets) and refundable deposits.
• 2) The balances included financial liabilities measured at amortized cost, which comprise short-term loans, notes payable, trade payables, other payables, long-term loans (including current portion of long-term borrowings) and guarantee deposits received.
• d. Financial risk management objectives and policies

The Group's major financial instruments consist of equity investments, cash and cash equivalents, receivables, long-term and short-term borrowings and trade payables. The Group's financial risk management pertains to financial risks relating to the operations of the Group, including currency risk, interest rate risk, credit risk and liquidity risk. The Group seeks to identify, evaluate and hedge against market uncertainties to lower the effect of market changes on the Group's financial performance.

The Group manages foreign exchange risk through setting up of foreign currency deposit bank accounts and through the use of foreign currency directly received from sale to pay for purchases in foreign currency to reduce the impact of foreign exchange fluctuation and to achieve a natural hedge effect. The Group actively observes the exchange rate information to fully control the foreign currency hedge.

1) Market risk

The Group's activities expose it primarily to the financial risks of changes in exchange rates (see Item (a) below), interest rates (see Item (b) below) and price (see Item (c) below).

There has been no change to the Group's exposure to market risks or the manner in which these risks are managed and measured.

a) Foreign currency risk

The carrying amounts of the Group's foreign currency denominated monetary assets and monetary liabilities (including those eliminated on consolidation) at the end of the reporting period are set out in Note 34.

Sensitivity analysis

The Group was mainly exposed to USD and RMB.

Had the NTD strengthened/weakened by 5% against the relevant currency, the pre-tax profit would have decreased/increased by \$153,958 thousand and \$217,103 thousand for the years ended December 31, 2021 and 2020, respectively. The 5% sensitivity rate is used when reporting foreign currency risk internally to key management personnel and represents management's assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency-denominated monetary items and their translation at period-end is adjusted for a 5% change in foreign-currency rates.

b) Interest rate risk

The Group is exposed to interest rate risk because entities in the Group borrow funds both at fixed and floated interest rates. The Group evaluates hedging activities regularly to align with interest rate views and defined risk appetite and ensures that the most cost-effective hedging strategies are applied.

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

December 31
2021	2020
	\$ 1,176,504
	1,537,030
	2,753,550
3,254,779	4,202,894
	\$ 1,400,290 690,793 2,909,610

Sensitivity analysis

The sensitivity analysis below has been determined on the basis of the exposure to interest rates for non-derivative instruments at balance sheet dates. For floating rate liabilities, the analysis was prepared assuming the amount of the liability outstanding at the balance sheet dates was outstanding for the whole year. A 50-basis point increase or decrease was used when reporting interest rate risk internally to key management personnel and represents management's assessment of the reasonably possible change in interest rates.

If interest rates had been 50 basis points higher/lower and all other variables were held constant, the Group's pre-tax profit for the years ended December 31, 2021 and 2020 would increase/decrease by \$1,726 thousand and \$7,247 thousand, respectively, which was mainly attributable to the Group's exposure to interest rates on its variable rate deposits and bank loans.

c) Price risk

The Group is exposed to equity price risks mainly arising from the followings:

• i. Investment in financial assets at FVTOCI (mainly investment in domestic and foreign stocks), which are held for strategic rather than trading purposes. The Group does not actively trade these investments.
• ii. Financial assets at FVTPL (mainly investment in domestic and foreign open-ended beneficiary certificates and listed stocks in Taiwan).

The Group manages risk through holding various investment portfolios and having each equity investment to get prior approval from the Group's management.

Sensitivity analysis

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

If equity prices had been 5% higher/lower, the pre-tax profit for the years ended December 31, 2021 and 2020 would have increased/decreased by \$25,487 thousand and \$25,683 thousand, respectively, as a result of the changes in fair values of financial assets at FVTPL, and the pre-tax other comprehensive income for the years ended December 31, 2021 and 2020 would have increased/decreased by \$58,345 thousand and \$43,145 thousand, respectively, as a result of the changes in fair values of financial assets at FVTOCI.

2) Credit risk

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

• a) The carrying amount of trade receivables from operating activities; and
• b) The amount of bank deposits, fixed-income and other financial instruments from investing activities.

The Group adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults.

Trade receivables involve a large number of customers, spread across diverse industries and geographical areas. Ongoing credit evaluation is performed on the financial condition of trade receivables, including the evaluation of internal credits, historical transaction records, present economic circumstances, etc. which affect the customers' payment ability.

The credit risk of the Group's trade receivables is mainly concentrated on specific customers in mainland China. The Group had properly assessed the expected credit loss of relevant trade receivables. As of December 31, 2021 and December 31, 2020, the above trade receivables accounted for 11.89% and 12.77%, respectively, of the total trade receivables.

The credit risk of bank deposits, fixed-income financial instruments and other financial instruments are evaluated, managed and controlled by the Group's financial department. The Group's exposure to credit risk was limited because the Group adopted a policy of only dealing with creditworthy counterparties.

3) Liquidity risk

The Group manages liquidity risk by managing and maintaining sufficient cash and cash equivalents to supply the Group's demand and mitigate the effects of fluctuations in cash flow. The Group continuously monitors the use of credit lines and conformity to loan terms.

The Group relies on bank borrowings as a significant source of liquidity. As of December 31, 2021 and 2020, the Group's available unutilized bank loan facilities were \$4,563,738 thousand and \$3,244,091 thousand, respectively.

Liquidity and interest risk tables for non-derivative financial liabilities

The following tables detail the Group's remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities from the earliest date on which the Group can be required to pay.

Bank loans with a repayment on demand clause were included in the earliest time band regardless of the probability of the banks choosing to exercise their rights. The maturity dates for other non-derivative financial liabilities were based on the agreed repayment dates.

	December 31, 2021
	Within 1 Year	1-5 Years	More Than 5 Years
Non-derivative financial liabilities
Non-interest bearing Fixed interest rate instruments Floating interest rate instruments Lease liabilities	\$ 4,427,710 208,228 1,927,042 120,292	\$ - 33,104 1,288,896 270,495	\$ - 92,348 80,730 16,552
	\$ 6,683,272	\$ 1,592,495 December 31, 2020	\$ 189,630
	Within 1 Year	1-5 Years	More Than 5 Years
Non-derivative financial liabilities
Non-interest bearing Fixed interest rate instruments Floating interest rate instruments Lease liabilities	\$ 3,914,549 1,314,065 1,908,542 59,308	\$ - 32,551 2,182,924 89,946	\$ - 83,505 176,862 5,224
	\$ 7,196,464	\$ 2,305,421	\$ 265,591

After considering the financial position of the Group, management does not expect the banks will execute their rights of requiring the Group to repay the bank loans immediately. In addition, management believes the operating funds of the Corporation and subsidiaries are sufficient to meet cash flow demand; thus, liquidity risk is not considered significant.

The Group's operating funds are sufficient to meet its cash flow demand, as a result, the Group does not use its overdraft limit.

29. TRANSACTIONS WITH RELATED PARTIES

a. The related parties and relationships with the Group were as follows:

Related Party	Relationship with the Group
Dynascan Technology Corp. ("Dynascan Technology") Adlink Technology Inc. ("Adlink")	Associate Associate
Chih Ho Shun Development Co., Ltd.	Joint venture
DynaScan Technology Inc. ("Dynascan USA")	Other related party (associate's subsidiary)
Mou Kuan Industry Co., Ltd. ("Mou Kuan")	Other related party
Quantel Co., Ltd. ("Quantel Thailand")	Other related party
Quantel Electronics (India) Private Limited (Quantel India)	Other related party
PT Quantel (Quantel Indonesia)	Other related party
Taiwan Advanced Nanotech Inc. ("TAN Bead")	Other related party
Tian Zheng International Precision Machinery Co., Ltd.	Other related party
Tian Zheng International Precision Machinery Co., Ltd.	Other related party (associate's
(Dongguan)	subsidiary)

Balances and transactions between the Corporation and its subsidiaries, which are related parties of the Corporation, have been eliminated on consolidation and are not disclosed in this note. Details of transactions between the Group and its related parties are disclosed below.

The related-party transactions were conducted under normal terms unless specified otherwise.

b. Sales

	For the Year Ended December 31
Related Party Categories/Name	2021	2020
Associates	\$ 24,245	\$ 18,225
Other related parties	41,465	42,382
	\$ 65,710	\$ 60,607

c. Purchases

	For the Year Ended December 31
Related Party Categories/Name	2021	2020
Associates Other related parties	\$ 22,414 22,985	\$ 23,987 23,085
	\$ 45,399	\$ 47,072

d. Contract liabilities

	December 31
Related Party Categories/Name	2021	2020
Associates
Adlink Technology Inc.	\$ -	\$308,000

It is advance receipt for selling the land and plant in Hwa Ya Technology park, refer to Note 14 for the detailed information.

e. Receivables from related parties (excluding loans to related parties)

		December 31
Line Item	Related Party Categories/Name	2021	2020
Trade receivables - related parties	Associates Other related parties	\$ 11,796 22,173	\$ 5,041 14,299
		\$ 33,969	\$ 19,340

Outstanding trade receivables from related parties are unsecured.

f. Payables to related parties (excluding loans from related parties)

			December 31
Line Item	Related Party Categories/Name	2021	2020
Notes payable - related parties	Other related parties	\$ 2,953	\$ 4,570
Trade payables - related parties	Associates Other related parties	\$ 3,877 7,128	\$ 6,613 4,740
		\$ 11,005	\$ 11,353

g. Acquisition of property, plant and equipment

	Purchase Price
	For the Year Ended December 31
Related Party Categories/Name	2021	2020
Associates	\$ 24,182	\$ 740

h. Disposal of property, plant and equipment

	Proceeds			Gain on Disposal
Related Party Category/Name	2021	2020	2021	2020
Associates Adlink Technology Inc.	\$ 3,080,000	\$ -	\$ 1,575,072	\$	-

Gain arising from transfer of right recognized as a result of sale and leaseback transactions amounted to \$154,510 thousand for the year ended December 31, 2021. Refer to Note 14 for the detailed information.

i. Lease arrangements

	For the Year Ended December	31
Related Party Categories/Name	2021	2020
Acquisitions of right-of-use assets
Associates Adlink Technology Inc.	\$ 180,053	\$ -

		December 31
Line Item	Related Party Categories/Name	2021	2020
Lease liabilities	Associates Adlink Technology Inc.	\$ 189,258	\$ -
		For the Year Ended December 31
Line Item	Related Party Categories/Name	2021	2020
Interest Expense	Associates Adlink Technology Inc.	\$ 1,317	\$ -
Depreciation Expense	Associates Adlink Technology Inc.	\$ 27,008	\$ -

Refer to Note 14 for the related transaction.

g. Others

			For the Year Ended December 31
Line Item	Related Party Categories/Name	2021	2020
Rental income	Associates Joint venture	\$ 6,611 16	\$ 1,260 -
	Other related parties	- \$ 6,627	100 \$ 1,360
Rental expense	Associates Other related parties	\$ 547 -	\$ - 12,600
		\$ 547	\$ 12,600
Administration expense	Associates Other related parties	\$ 12,791 2,785	\$ 450 3,481
		\$ 15,576	\$ 3,931
			December 31
Line Item	Related Party Categories/Name	2021	2020
Other current assets	Associates Joint venture	\$ 2,771 3	\$ 523 -
	Other related parties	663	1,264
		\$ 3,437	\$ 1,787
Other payables	Associates Other related parties	\$ 5,525 21	\$ 75 -
		\$ 5,546	\$ 75

h. Compensation of key management personnel

	For the Year Ended December 31 2021 2020
Short-term employee benefits Post-employment benefits	\$ 179,017 2,765	\$ 147,577 2,435
	\$ 181,782	\$ 150,012

The remuneration of directors and key executives is determined by the remuneration committee based on the performance of individuals and market trends.

30. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

The assets pledged as collaterals for bank loans, product warranties and court deposit guarantees were as follows:

		December 31
	2021		2020
Property, plant and equipment, net	\$ 189,129	\$	815,553
Pledged deposits (classified as financial assets measured at amortized cost)	780,314		729,393
	\$ 969,443	\$	1,544,946

31. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

Chroma's subsidiary, MAS Automation Corporation ("MAS"), entered into an Equipment Purchase Agreement ("Agreement") with LINCO Technology Co., Ltd ("LINCO") in 2017, in which MAS entrusted LINCO to manufacture automation equipment. However, LINCO failed to deliver a considerable number of important parts of the equipment to MAS; furthermore, LINCO rejected to perform its installation services under the Agreement. Hence, MAS claimed for a delay penalty of \$2,503,659 thousand (around US\$83,455 thousand) against LINCO, of which MAS filed a civil lawsuit on November 12, 2018 for \$440,000 thousand, and the remaining penalty was reserved for the right to claim in the future. In addition, MAS submitted a petition to the court for provisional attachment against LINCO to secure its right, and offered a deposit in an amount of \$440,000 thousand to the court. Whereas, LINCO conversely alleged that MAS breached its payment obligation under the Agreement. LINCO raised a counterclaim against MAS in the Taiwan Taoyuan District Court on October 30, 2019, claiming for the payment of \$255,640 thousand (around US\$8,240 thousand) along with the interest. On the other hand, LINCO asserted that it suffered from the provisional attachment which was submitted by MAS, and brought another civil lawsuit against MAS in the Taiwan Taichung High Court, claiming for the damage compensation of \$505,521 thousand. The case had been pronounced by the court on May 12, 2021. The court rejected the compensatory damage and the request for claim of provisional execution by LINCO. As such, LINCO made an appeal to the Taiwan Supreme Court on June 9, 2021. As of December 31, 2021, the lawsuit has yet to be settled, and the outcome of the judgment cannot be reliably estimated.

32. SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD

a. Considering the future strategy of products and the improvement of product competitiveness, the Group invested in 100% equity of Environmental Stress Systems, Inc. for US\$1.98 million, and completed the equity investment in January 2022.

• b. Considering the future strategy of operation, the Corporation's board of directors resolved to terminate main business and dissolve its important subsidiary, Chroma New Material Corp., on January 11, 2022.
• c. The Corporation's subsidiary, Mou Kuan Technologies (Nanjing) Co., Ltd., had completed its liquidation procedures on January 25, 2022.

33. SIGNIFICANT EVENTS

The global economic and financial development are facing significant uncertainty due to the outbreak of COVID-19 pandemic. As of the date the financial statements were authorized for issue, the Group assessed that the pandemic did not have material impact on its ability to continue as a going concern, impairment of assets and risks arising from financing activities. The Group continuously observes and assesses the impact of the pandemic on the aforementioned aspects.

34. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

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

December 31, 2021

	Foreign Currencies	Exchange Rate	Carrying Amount
Financial assets
Monetary items
USD	\$ 96,108	27.680 (USD:NTD)	\$ 2,660,272
USD	11,417	7.799 (USD:HKD)	316,019
USD	10,329	6.372 (USD:RMB)	285,894
USD	8,816	1.353 (USD:SGD)	\$ 244,031
RMB	136,085	4.344 (RMB:NTD)	591,153
RMB	91,770	1.224 (RMB:HKD)	398,647
RMB	35,246	0.157 (RMB:USD)	153,109
			\$ 4,649,125
Non-monetary items
Investments accounted for using the equity method
USD	96,622	27.680 (USD:NTD)	\$ 2,674,510
Financial liabilities
Monetary items
USD	42,691	27.680 (USD:NTD)	1,181,688
USD	9,241	7.799 (USD:HKD)	255,798
RMB	30,495	1.224 (RMB:HKD)	132,472
			\$ 1,569,958

December 31, 2020

	Foreign Currencies	Exchange Rate	Carrying Amount
Financial assets
Monetary items
USD	\$ 113,578	28.480 (USD:NTD)	\$ 3,234,710
USD	20,512	7.754 (USD:HKD)	584,178
USD	9,108	6.507 (USD:RMB)	259,401
USD	8,315	0.813 (USD:EUR)	236,801
USD	7,437	1.321 (USD:SGD)	211,797
RMB	135,694	4.377 (RMB:NTD)	593,933
RMB	132,021	1.192 (RMB:HKD)	577,856
RMB	34,682	0.154 (RMB:USD)	151,803
			\$ 5,850,479
Non-monetary items Investments accounted for using the equity method USD	86,592	28.480 (USD:NTD)	\$ 2,466,146
Financial liabilities
Monetary items
USD	31,401	28.480 (USD:NTD)	\$ 894,301
USD	13,355	7.754 (USD:HKD)	380,346
USD	8,208	0.813 (USD:EUR)	233,763
			\$ 1,508,410

For the years ended December 31, 2021 and 2020, (realized and unrealized) net foreign exchange losses were \$54,773 thousand and \$86,618 thousand, respectively. It is impractical to disclose net foreign exchange gains (losses) by each significant foreign currency due to the variety of the foreign currency transactions of the entities in the Group.

35. SEPARATELY DISCLOSED ITEMS

• a. Information about significant transactions and investees:
• 1) Financing provided to others: Table 1 (attached)
• 2) Endorsements/guarantees provided: Table 2 (attached)
• 3) Marketable securities held (excluding investment in subsidiaries, associates and joint ventures): Table 3 (attached)

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

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

• 6) Disposal of individual real estate at prices of at least NT\$300 million or 20% of the paid-in capital: Table 4 (attached).
• 7) Total purchases from or sales to related parties amounting to at least NT\$100 million or 20% of the paid-in capital: Table 5 (attached)
• 8) Receivables from related parties amounting to at least NT\$100 million or 20% of the paid-in capital: Table 6 (attached)
• 9) Trading in derivative instruments: None
• 10) Others: Intercompany relationships and significant intercompany transactions: Table 7 (attached)
• 11) Information on investees: Table 8 (attached)
• b. Information on investments in mainland China
• 1) Information on any investee company in mainland China, showing the name, principal business activities, paid-in capital, method of investment, inward and outward remittance of funds, ownership percentage, net income of investees, investment income or loss, carrying amount of the investment at the end of the period, repatriations of investment income, and limit on the amount of investment in the mainland China area: Table 9 (attached)
• 2) Any of the following significant transactions with investee companies in mainland China, either directly or indirectly through a third party, and their prices, payment terms, and unrealized gains or losses:
  • a) The amount and percentage of purchases and the balance and percentage of the related payables at the end of the period: Table 5 (attached)
  • b) The amount and percentage of sales and the balance and percentage of the related receivables at the end of the period: Table 5 (attached)
  • c) The amount of property transactions and the amount of the resultant gains or losses: None.
  • d) The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the end of the period and the purposes: Table 2 (attached).
  • e) The highest balance, the end of period balance, the interest rate range, and total current period interest with respect to financing of funds: Table 1 (attached).
  • f) Other transactions that have a material effect on the profit or loss for the year or on the financial position, such as the rendering or receiving of services: None.
• c. Information of major shareholders: List all shareholders with ownership of 5% or greater showing the name of the shareholder, the number of shares owned, and percentage of ownership of each shareholder: None.

36. SEGMENT INFORMATION

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

• a. Special materials department.
• b. Test instrument department.
• c. Automatic equipment department.
• d. Other
• 1) Segment revenues and results

	Special Materials Department	Test Instrument Department	Automatic Equipment Department	Other	Elimination	Total
For the year ended December 31, 2021
Revenue from external customers Inter-segment revenue Segment revenue	\$ 2,804,306 15 \$ 2,804,321	\$ 13,555,365 8,763,991 \$ 22,319,356	\$ 780,206 370,736 \$ 1,150,942	\$ 444,146 49 \$ 444,195	\$ - (9,134,791) \$ (9,134,791)	\$ 17,584,023 - 17,584,023
Consolidated revenue Segment income Non-operating income and expenses	\$ 59,995	\$ 3,050,270	\$ (179,022)	\$ 107,028	\$ 36,722	\$ 17,584,023 \$ 3,074,993 2,208,853
Profit before tax						\$ 5,283,846
For the year ended December 31, 2020
Revenue from external customers Inter-segment revenue Segment revenue	\$ 2,551,127 7 \$ 2,551,134	\$ 12,045,049 8,460,756 \$ 20,505,805	\$ 617,812 194,311 \$ 812,123	\$ 318,555 275 \$ 318,830	\$ - (8,655,349) \$ (8,655,349)	\$ 15,532,543 - 15,532,543
Consolidated revenue						\$ 15,532,543
Segment income Non-operating income and expenses	\$ 32,246	\$ 2,870,986	\$ (170,512)	\$ 5,477	\$ 59,204	\$ 2,797,401 231,606
Profit before tax						\$ 3,029,007

The sales between segments are based on fair value.

The above revenues were generated through transactions with external customers and among segments. The inter-segment revenues for the years ended December 31, 2021 and 2020 had been adjusted and eliminated from the consolidated financial statements.

Segment operating income refers to profits earned by each segment, excluding remuneration of directors, share of profits or loss of associates and joint venture, rental income, interest income, gain (loss) on disposal of property, plant and equipment, gain (loss) on disposal of investments, foreign exchange gain (loss), valuation gain (loss) on financial instruments, finance costs and income tax expense. This was the measure reported to the Group's chief operating decision maker to allocate resources to each segment and evaluate its performance.

2) Segment assets and liabilities

	December 31
	2021	2020
Segment assets
Special materials department Test instrument department Automatic equipment department Others Adjustments and eliminations Total segment assets Investments and other unallocated assets	\$ 1,029,163 23,124,910 1,818,625 401,165 (3,385,996) 22,987,867 6,558,250	\$ 1,063,918 22,569,260 2,330,813 274,843 (3,977,415) 22,261,419 5,867,464
Consolidated total assets	\$ 29,546,117	\$ 28,128,883
Segment liabilities
Special material department Test instrument department Automatic equipment department Others Adjustments and eliminations Total segment liabilities Borrowings and other unallocated liabilities	\$ 782,430 7,067,919 999,050 115,803 (2,695,297) 6,269,905 4,328,754	\$ 834,982 6,262,348 1,410,681 86,490 (3,067,754) 5,526,747 6,213,443
Consolidated total liabilities	\$ 10,598,659	\$ 11,740,190

For the purpose of monitoring segment performance and allocating resources between segments:

• a) All assets were allocated to reportable segments other than interests in associates accounted for using the equity method, other financial assets, and deferred tax assets. Goodwill was allocated to reportable segments.
• b) All liabilities were allocated to reportable segments other than borrowings and deferred tax liabilities.
• 3) Revenue from major products

The following is an analysis of the Group's revenue from its major products and services:

		For the Year Ended December 31
	2021	2020
Special material equipment	\$ 2,804,306	\$ 2,551,127
Test instrument equipment	13,555,365	12,045,049
Automatic equipment	780,206	617,812
	\$ 17,139,877	\$ 15,213,988

4) Geographical information

The Group's primary operating areas are Taiwan, Republic of China, America, and others.

The Group's revenue from external customers by location of operations and information about its non-current assets by geographical location are detailed below.

	Revenue from External Customers
	For the Year Ended		Non-current Assets
	December 31		December 31
	2021	2020	2021	2020
Taiwan	\$ 6,893,918	\$ 5,719,342	\$ 8,943,752	\$ 9,143,772
China	5,784,661	5,779,446	369,790	369,121
America	2,848,020	2,365,314	385,677	409,274
Others (note)	2,057,424	1,668,441	422,955	357,119
	\$ 17,584,023	\$ 15,532,543	\$ 10,122,174	\$ 10,279,286

Note: Including all area amount of non-significant subsidiaries.

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

5) Information about major customers

There was no revenue from any individual customer exceeded 10% of the Group's revenue for the years ended December 31, 2021 and 2020.

CHROMA ATE INC. AND SUBSIDIARIES

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

					Highest		Actual			Business	Reasons for	Allowance		Collateral	Financing	Aggregate
No.	Lender	Borrower	Financial Statement Account	Related Parties	Balance for the Period	Ending Balance	Borrowing Amount	Interest Rate	Nature of Financing	Transaction Amounts	Short-term Financing	for Impairment Loss	Item	Value	Limit for Each Borrower	Financing Limit
0	The Corporation	Chroma Systems Solutions, Inc. Chroma Japan Corp.	Other receivables Other receivables	Y Y	\$ 103,151 \$ 127,905	100,106 \$ 110,540	100,106 24,949	3.25% 1.30%	1 1	\$ 546,995 258,255	- -	\$ - -	- -	\$ -	- \$ 1,851,391 (Note 1) 1,851,391 (Note 1)	\$ 3,702,782 (Note 2) 3,702,782 (Note 2)

Note 1: Based on 10% of the net value of the Corporation.

Note 2: Based on 20% of the net value of the Corporation.

Note 3: The amounts listed in the table were translated into the New Taiwan dollars at the exchange rate of US\$1=NT\$27.680 and JPY1 = NT\$0.241 as of December 31, 2021.

Note 4: Financing provided:

• a. For transactions.
• b. For short-term financing.

CHROMA ATE INC. AND SUBSIDIARIES

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

		Endorsee/Guarantee		Limits on					Ratio of				Endorsement/
No.	Endorser/ Guarantor	Name	Relationship	Endorsement/ Guarantee Given on Behalf of Each Party (Note 1)	Maximum Amount Endorsed/ Guaranteed During the Period	Outstanding Endorsement/ Guarantee at the End of the Period	Actual Borrowing Amount	Amount Endorsed/ Guaranteed by Collateral	Accumulated Endorsement/ Guarantee to Net Equity in Latest Financial Statements	Aggregate Endorsement Guarantee Limit (Note 2)	Endorsement/ Guarantee Given by Parent on Behalf of Subsidiaries	Endorsement/ Guarantee Given by Subsidiaries on Behalf of Parent	Guarantee Given on Behalf of Companies in Mainland China
0	The Corporation	Chroma Japan Corp.	Subsidiary	\$ 2,777,087	\$ 48,200	\$ 48,200	\$ 36,150	\$ -	0.26%	\$ 5,554,173	Y	-	-
		Chroma ATE Europe B.V.	Subsidiary	2,777,087	46,980	46,980	15,660	-	0.25%	5,554,173	Y	-	-
		Chroma ATE Inc.	Subsidiary	2,777,087	221,440	221,440	138,400	-	1.20%	5,554,173	Y	-	-
		Sajet System Technology (Suzhou) Co., Ltd.	Subsidiary	2,777,087	21,720	21,720	-	-	0.12%	5,554,173	Y	-	Y
		Chroma Electronics (Shanghai) Co., Ltd.	Subsidiary	2,777,087	43,440	43,440	-	-	0.23%	5,554,173	Y	-	Y
		Chroma ATE (Suzhou) Co., Ltd.	Subsidiary	2,777,087	338,832	338,832	77,321	-	1.83%	5,554,173	Y	-	Y
		Mas Automation Corp.	Subsidiary	2,777,087	300,000	300,000	201,000	-	1.62%	5,554,173	Y	-	-

Note 1: According to Regulation of the "Procedures for Endorsement/Guarantee and lending of Funds", the Corporation limits the endorsement/guarantee amount on each entity to within 15% of the net value of the Corporation and the capital issued of the entity endorsed/guaranteed, but 100% held subsidiary is not limited by the regulation.

Note 2: According to Regulation of the "Procedures for Endorsement/Guarantee and Lending of Funds", the Corporation limits the endorsement/guarantee amount within the 30% of the net value of the Corporation.

Note 3: The amounts listed in columns were translated into the New Taiwan dollars at the exchange rate of US\$1=NT\$27.680, JPY1=NT\$0.241, RMB1=NT\$4.344, EUR1=NT\$31.320, as of December 31, 2021.

CHROMA ATE INC. AND SUBSIDIARIES

MARKETABLE SECURITIES HELD

(EXCLUDING INVESTMENT IN SUBSIDIARIES, ASSOCIATES AND JOINTLY CONTROLLED ENTITIES) DECEMBER 31, 2021

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

					December 31, 2021
Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account	Shares/Units (In Thousands)	Carrying Amount	Percentage of Ownership	Fair Value	Note
The Corporation	Fund WI Harper INC Fund VII LP	-	Financial assets at fair value through profit or loss - non-current	-	\$ 4,793	-	\$ 4,793	-
	Stocks
	DynaColor, Inc.	-	Financial assets at fair value through other comprehensive income - non-current	6,050	214,181	6.1	214,181	-
	Chunghwa Telecom Co., Ltd.	-	〃	412	48,043	-	48,043	-
	China Communications Media Group Co., Ltd.	-	〃	10	192	0.1	192	-
	Tian Zheng International Precision Machinery Co., Ltd.	-	〃	2,681	248,764	7.3	248,764	-
	Twoway Catv Service Inc.	-	〃	3,561	49,599	4.4	49,599	-
	Taiwan Advanced Nanotech Inc.	-	〃	2,673	368,692	11.5	368,692	-
	WK Technology Fund IX Ltd.	-	〃	4,614	59,668	4.6	59,668	-
	WK Technology Fund IV Ltd.	-	〃	202	300	1.9	300	-
	WK Technology Fund VI Ltd.	-	〃	361	285	1.4	285	-
	TFBS Bioscience Inc.	-	〃	4,330	76,295	14.3	76,295	-
Chroma New Material Corp.	Fund Mega Diamond Money Market Fund	-	Financial assets at fair value through profit or loss - current	16,335	207,095	-	207,095	-
Chroma Systems Solutions Inc.	Fund Franklin California Tax Free Income FD Inc.	-	〃	426	91,534	-	91,534	-
Chroma Investment Co., Ltd.	Fund Hua Nan Kirin Money Market Fund	-	〃	3,597	43,482	-	43,482	-
	Stocks
	Greatek Electronics Inc.	-	〃	85	6,643	-	6,643	-
	Hephas Energy Corporation	-	〃	1,042	53,224	6.8	53,224	-
	Chroma ATE Inc.	The Corporation	Financial assets at fair value through other comprehensive income - non-current	1,806	361,115	0.4	361,115	-
	Taiwan Advanced Nanotech Inc.	-	〃	607	83,794	2.6	83,794	-
	Cosmactive Broadband Networks Co., Ltd.	-	〃	4	-	0.6	-	-
	Global Mixed-mode Technology Inc.	-	〃	111	-	5.1	-	-

(Continued)

					December 31, 2021
Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account	Shares/Units (In Thousands)	Carrying Amount	Percentage of Ownership	Fair Value	Note
Chen Hwa Technology Inc.	Stocks Hangzhou New Material Chroma Co., Ltd.	-	Financial assets at fair value through other comprehensive income - non-current	-	\$ 17,079	19.0	\$ 17,079	-
Innovative Nanotech Incorporated	Fund Mega Diamond Money Market Fund	-	Financial assets at fair value through profit or loss - current	6,605	83,740	-	83,740	-
EVT Technology Co., Ltd.	Fund Mega Diamond Money Market Fund	-	〃	1,517	19,231	-	19,231	-

Note: The fair value of open-end beneficiary certificates and listed market securities was calculated based on the net asset value and closing price as of balance sheet date.

(Concluded)

CHROMA ATE INC. AND SUBSIDIARIES

DISPOSAL OF INDIVIDUAL REAL ESTATE AT PRICES OF AT LEAST NT\$300 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Seller	Property	Event Date	Original Acquisition Date	Carrying Amount	Transaction Amount	Collection	Gain (Loss) on Disposal	Counterparty	Relationship	Purpose of Disposal	Price Reference	Other Terms
The Corporation	Land and buildings	2020.07.03	1999-2004	\$ 1,089,054		\$ 3,080,000 The full amount has been collected	\$ 1,575,072 (Note)	Adlink Technology Inc.	Associate	In order to revitalize assets, increase working capital and repay debts.	Real estate appraisal reports of Cushman & Wakefield and CCIS Real Estate Joint Appraisers Firm	Sell and leaseback partial square feet of factory in Hua Ya technology park for the use of factory and employees' dormitory, and promise to lease for 5 years.

Note: The Group recognized gain arising from transfer of right of \$154,510 thousand in accordance with the sale and leaseback transaction.

CHROMA ATE INC. AND SUBSIDIARIES

TOTAL PURCHASE FROM OR SALE TO RELATED PARTIES AMOUNTING TO AT LEAST \$100 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

					Transaction	Details	Abnormal Transaction		Notes/Accounts Receivable (Payable)
Company Name	Related Party	Relationship	Purchase (Sale)	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total	Note
The Corporation	Neworld Electronics Limited	Subsidiary	(Sale)	\$ (2,438,399)	(24)	Net 365 days after monthly closing	-	-	\$ 415,016	16	-
Neworld Electronics Limited	The Corporation	Parent company	Purchase	2,438,399	100	Net 90 days after delivery	-	-	(415,016)	(100)	-
The Corporation	Chroma ATE Inc.	Subsidiary	(Sale)	(1,226,840)	(12)	Net 365 days after monthly closing	-	-	310,748	12	-
Chroma ATE Inc.	The Corporation	Parent company	Purchase	1,226,840	100	Net 180 days after delivery	-	-	(310,748)	(100)	-
The Corporation	Chroma Electronics (Shanghai) Co., Ltd.	Subsidiary	(Sale)	(650,408)	(6)	Net 365 days after monthly closing	-	-	26,068	1	-
Chroma Electronics (Shanghai) Co., Ltd.	The Corporation	Parent company	Purchase	650,408	100	Net 120 days after delivery	-	-	(26,068)	(100)	-
The Corporation	Chroma Systems Solutions, Inc.	Subsidiary	(Sale)	(546,995)	(5)	Net 90 days after delivery	-	-	126,323	5	-
Chroma Systems Solutions, Inc.	The Corporation	Parent company	Purchase	546,995	100	Net 90 days after delivery	-	-	(126,323)	(100)	-
The Corporation	Chroma Electronics (Shenzhen) Co., Ltd.	Subsidiary	(Sale)	(438,598)	(4)	Net 365 days after monthly closing	-	-	109,542	4	-
Chroma Electronics (Shenzhen) Co., Ltd.	The Corporation	Parent company	Purchase	438,598	100	Net 90 days after monthly closing	-	-	(109,542)	(100)	-
The Corporation	Chroma ATE (Suzhou) Co., Ltd.	Subsidiary	(Sale)	(412,428)	(4)	Net 365 days after monthly closing	-	-	206,239	8	-
Chroma ATE (Suzhou) Co., Ltd.	The Corporation	Parent company	Purchase	412,428	100	Net 120 days after delivery	-	-	(206,239)	(100)	-
The Corporation	Chroma ATE Europe B.V.	Subsidiary	(Sale)	(326,489)	(3)	Net 365 days after monthly closing	-	-	72,438	3	-
Chroma ATE Europe B.V.	The Corporation	Parent company	Purchase	326,489	100	Net 90 days after delivery	-	-	(72,438)	(100)	-
The Corporation	Chroma Japan Corp.	Subsidiary	(Sale)	(258,255)	(3)	Net 365 days after monthly closing	-	-	344,895	13	-
Chroma Japan Corp.	The Corporation	Parent company	Purchase	258,255	100	Net 90 days after delivery	-	-	(344,895)	(100)	-
The Corporation	Quantel Private Ltd.	Subsidiary	(Sale)	(244,962)	(2)	Net 90 days after delivery	-	-	30,409	1	-
Quantel Private Ltd.	The Corporation	Parent company	Purchase	244,962	100	Net 90 days after delivery	-	-	(30,409)	(100)	-
Neworld Electronics Limited	Chroma Electronics (Shenzhen) Co., Ltd	Subsidiary	(Sale)	(1,081,194)	(41)	Net 90 days after declaration	-	-	231,464	34	-

(Continued)

Company Name						Transaction Details	Abnormal Transaction		Notes/Accounts Receivable (Payable)
	Related Party	Relationship	Purchase (Sale)	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total	Note
Chroma Electronics (Shenzhen) Co., Ltd	Neworld Electronics Limited	Parent company	Purchase	\$ 1,081,194	66	Net 90 days after declaration	-	-	\$ (231,464)	(68)	-
Chroma ATE Europe B.V.	Chroma Germany GmbH	Subsidiary	(Sale)	(127,121)	(26)	Net 90 days after declaration	-	-	43,050	36	-
Chroma Germany GmbH	Chroma ATE Europe B.V.	Parent company	Purchase	127,121	80	Net 90 days after declaration	-	-	(43,050)	(99)	-
Neworld Electronics Limited	Chroma ATE (Suzhou) Co., Ltd.	Same parent company	(Sale)	(241,286)	(9)	Net 90 days after declaration	-	-	126,989	18	-
Chroma ATE (Suzhou) Co., Ltd.	Neworld Electronics Limited	Same parent company	Purchase	241,286	18	Net 90 days after declaration	-	-	(126,989)	(21)	-
Wei Kuang Automatic Equipment (Xiamen) Co., Ltd.	Chroma ATE (Suzhou) Co., Ltd.	Same parent company	(Sale)	(160,890)	(40)	Net 90 days after declaration	-	-	21,881	21	-
Chroma ATE (Suzhou) Co., Ltd.	Wei Kuang Automatic Equipment (Xiamen) Co., Ltd.	Same parent company	Purchase	160,890	12	Net 90 days after declaration	-	-	(21,881)	(4)	-

Note: The actual credit period is longer than other customers, the recovery of receivables depends on the related parties' financial position.

(Concluded)

CHROMA ATE INC. AND SUBSIDIARIES

RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST \$100 MILLION OR 20% OF THE PAID-IN CAPITAL

DECEMBER 31, 2021

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

							Overdue	Amount
Company Name	Related Party Relationship Ending Balance			Turnover Rate	Amount	Action Taken	Received in Subsequent Period (Note)	Allowance for Impairment Loss
	Chroma Japan Corp.	Subsidiary	Trade receivables	344,895	0.93	-	-	-	-
	Mas Automation Corp.	Subsidiary	Dividends receivable	295,000	-	-	-	-	-
	Chroma ATE (Suzhou) Co., Ltd.	Same parent company	Trade receivables	126,989	1.49	-	-	20,675	-
The Corporation Neworld Electronics Limited	Neworld Electronics Limited Chroma ATE Inc. Chroma ATE (Suzhou) Co., Ltd. Chroma Systems Solutions, Inc. Chroma Electronics (Shenzhen) Co, Ltd. Chroma Systems Solutions, Inc. Chroma Electronics (Shenzhen) Co, Ltd.	Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary	Trade receivables Trade receivables Trade receivables Trade receivables Trade receivables Other receivables - financing provided Trade receivables	\$ 415,016 310,748 206,239 126,323 109,542 100,106 231,464	5.14 2.80 2.19 4.68 3.52 - 5.73	\$ - - - - - - -	- - - - - - -	\$ 296,195 163,584 18,842 83,370 64,521 607 209,442	\$ - - - - - - -

Note: As of February 23, 2022.

CHROMA ATE INC. AND SUBSIDIARIES

INTERCOMPANY RELATIONSHIPS AND SIGNIFICANT TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 2021

(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

No.	Company Name	Counterparty	Flow of Transactions (Note 1)	Account	Transaction Details Amount	Transaction Terms	Percentage to Consolidated Total Operating Revenues or Total Assets
0	The Corporation	Neworld Electronics Limited Chroma ATE Inc. Chroma Electronics (Shanghai) Co, Ltd. Chroma Systems Solutions, Inc. Chroma Electronics (Shenzhen) Co, Ltd. Chroma ATE (Suzhou) Co., Ltd. Chroma ATE Europe B.V. Chroma Japan Corp. Quantel Private Ltd. Testar Electronics Corporation Adivic Technology Co. Chroma ATE Inc. Chroma Electronics (Shanghai) Co., Ltd. Quantel Private Ltd. Chroma ATE (Suzhou) Co., Ltd. Wei Kuang Automatic Equipment Co., Ltd. Neworld Electronics Limited Chroma Japan Corp. Chroma ATE Inc. Chroma ATE (Suzhou) Co., Ltd. Chroma Systems Solutions, Inc. Chroma Electronics (Shenzhen) Co, Ltd. Chroma ATE Europe B.V. Quantel Private Ltd. Chroma Electronics (Shanghai) Co., Ltd. Chroma Systems Solutions, Inc. Chroma Japan Corp. Wei Kuang Automatic Equipment Co., Ltd. Chroma ATE Inc. Quantel Private Ltd.	a a a a a a a a a a a a a a a a a a a a a a a a a a a a a a	Operating revenue Operating revenue Operating revenue Operating revenue Operating revenue Operating revenue Operating revenue Operating revenue Operating revenue Operating revenue Purchase Purchase Commissions expense Commissions expense Commissions expense Operating expense Trade receivables Trade receivables Trade receivables Trade receivables Trade receivables Trade receivables Trade receivables Trade receivables Trade receivables Other receivables - financing provided Other receivables - financing provided Dividends receivable Trade payables Accrual expense	\$ 2,438,399 1,226,840 650,408 546,995 438,598 412,428 326,489 258,255 244,962 61,843 75,579 57,787 29,573 26,796 16,419 13,376 415,016 344,895 310,748 206,239 126,323 109,542 72,438 30,409 26,068 100,106 24,949 295,000 13,557 12,402	Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms	14 7 4 3 2 2 2 1 1 - - - - - - - 1 1 1 1 - - - - - - - 1 - -
1	Wei Kuang Automatic Equipment Co., Ltd.	Chroma Japan Corp. Wei Kuang Automatic Equipment (Nanking) Co., Ltd. Wei Kuang Automatic Equipment (Xiamen) Co., Ltd.	b b b	Operating revenue Operating revenue Purchase	72,394 21,200 41,707	Based on regular terms Based on regular terms Based on regular terms	- - -

(Continued)

				Transaction Details	Percentage to
No.	Company Name	Counterparty	Flow of Transactions (Note 1)	Account	Amount	Transaction Terms	Consolidated Total Operating Revenues or Total Assets
2	Neworld Electronics Limited	Chroma Electronics (Shenzhen) Co., Ltd. Chroma ATE (Suzhou) Co., Ltd. Chroma Electronics (Shanghai) Co., Ltd. Chroma Electronics (Shenzhen) Co., Ltd. Chroma Electronics (Shanghai) Co., Ltd. Chroma ATE (Suzhou) Co., Ltd. Chroma Electronics (Shenzhen) Co., Ltd.	a b a a a b a	Operating revenue Operating revenue Operating revenue Commissions expense Commissions expense Commissions expense Trade receivables	\$ 1,081,194 241,286 63,390 62,275 35,341 19,323 231,464	Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms Based on regular terms	6 1 - - - - 1
		Chroma ATE (Suzhou) Co., Ltd.	b	Trade receivables	126,989	Based on regular terms	-
3	Chroma Electronics (Shenzhen) Co., Ltd.	Chroma ATE (Suzhou) Co., Ltd. Chroma Electronics (Shanghai) Co., Ltd. Sajet System Technology (Suzhou) Co., Ltd. Chroma ATE (Suzhou) Co., Ltd.	b b b b	Operating revenue Operating revenue Purchase Trade receivables	32,596 14,728 15,015 16,698	Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - - -
4	Chroma ATE (Suzhou) Co., Ltd.	Chroma Electronics (Shanghai) Co., Ltd. Chroma Electronics (Shenzhen) Co., Ltd.	b b	Operating revenue Operating revenue	21,252 14,371	Based on regular terms Based on regular terms	- -
5	Wei Kuang Automatic Equipment (Xiamen) Co., Ltd.	Chroma ATE (Suzhou) Co., Ltd. Wei Kuang Automatic Equipment (Nanjing) Co., Ltd. Wei Kuang Automatic Equipment (Nanjing) Co., Ltd. Chroma ATE (Suzhou) Co., Ltd.	b b b b	Operating revenue Operating revenue Trade receivables Trade receivables	160,890 40,153 24,641 21,881	Based on regular terms Based on regular terms Based on regular terms Based on regular terms	1 - - -
6	Chroma ATE Europe B.V.	Chroma Germany GmbH Chroma Germany GmbH Chroma Germany GmbH	a a a	Operating revenue Trade receivables Other receivables	127,121 43,050 16,735	Based on regular terms Based on regular terms Based on regular terms	1 - -
7	Quantel Private Ltd.	Quantel Global Vietnam Co., Ltd. Quantel Global Sdn. Bhd. Quantel Global Philippines Corporation Quantel Global Vietnam Co., Ltd.	a a a a	Operating revenue Operating revenue Operating expense Trade receivables	62,261 51,070 15,450 11,206	Based on regular terms Based on regular terms Based on regular terms Based on regular terms	- - - -

Note 1: a. From parent to subsidiary.

b. Between subsidiaries.

Note 2: The prices were determined after taking the selling and post-sale service expenses into consideration.

Note 3: The collection periods of about 12 months were longer than those for third parties.

(Concluded)

INFORMATION ON INVESTEES FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

				Investment Amount		Balance as of December 31, 2021			Net Income
Investor	Investee	Location	Main Businesses and Products		December 31,	December 31,	Shares	Percentage of	Carrying	(Loss) of the	Investment Gain (Loss)	Note
				2021		2020	(Thousands)	Ownership	Amount	Investee
The Corporation	Neworld Electronics Limited	Hong Kong	Sale and maintenance of electronic test instruments, etc.	\$ 271,873		\$ 271,873	64,012,815	100.0	\$ 1,457,155	\$ 197,341	\$ 197,343 Subsidiary
	Chroma New Material Corporation	Taoyuan, Taiwan	Sale and processing of gold wire		480,715	480,715	25,000,000	100.0	452,823	43,498		43,500 Subsidiary
	Mas Automation Corp.	Hsinchu, Taiwan	Design, manufacturing, installment and testing of automated factory conveyor systems		533,000	533,000	10,000,000	100.0	54,437	(215,979)		(215,830) Subsidiary
	Chroma ATE Inc.	USA	Sale and maintenance of electronic test instruments, etc.		29,895	29,895	1,000,000	100.0	240,654	105,486		105,465 Subsidiary
	Chroma Systems Solutions, Inc.	USA	Sale and maintenance of electronic test instruments, etc.		29,628	29,628	120,000	25.0	28,328	265,558		66,389 Subsidiary
	Chroma ATE Europe B.V.	The Netherlands	Sale and maintenance of electronic test instruments, etc.		54,026	54,026	1,000	100.0	121,610	707		724 Subsidiary
	Chroma Japan Corp.	Japan	Sale and maintenance of electronic test instruments, etc.		201,750	201,750	9,975	100.0	(137,987)	(28,024)		(28,023) Subsidiary
	CHI Incorporation Ltd.		British Virgin Islands Test of inductance, capacitance and resistance, and sale of parts		122,884	122,884	3,830,000	100.0	240,238	41,607		41,607 Subsidiary
	Chen Hwa Technology Inc.		British Virgin Islands Test of inductance, capacitance and resistance, and sale of parts		98,217	98,217	3,085,000	100.0	120,885	6,590		6,590 Subsidiary
	San Eagle Development Corp.	British Virgin Islands Investment			186,514	186,514	2,050,000	100.0	903,070	69,610		69,345 Subsidiary
	Sensational Holdings Ltd.	British Virgin Islands Investment			38,301	38,301	1,200,000	100.0	49,035	(307)		(307) Subsidiary
	Deep Red Holding Co., Ltd.	Mauritius	Investment		12,217	12,217	215,000	100.0	161,366	20,927		20,927 Subsidiary
	Testar Electronics Corporation	Taoyuan, Taiwan	Testing of LED		247,096	247,096	20,159,600	67.2	117,453	133,023		89,413 Subsidiary
	Adivic Technology Co., Ltd.	Taoyuan, Taiwan	Sale and research of RF device		273,800	273,800	12,590,000	74.1	60,382	1,794		(13,860) Subsidiary
	Chroma Investment Co., Ltd.	Taoyuan, Taiwan	Investment		80,000	80,000	14,000,000	100.0	224,435	22,626		22,626 Subsidiary
	Quantel Private Ltd.	Singapore	Sale and maintenance of test instruments, etc.		112,328	112,328	1,914,000	60.0	206,174	80,051		47,751 Subsidiary
	EVT Technology Co., Ltd.	Taoyuan, Taiwan	Manufacturing of motorcycles and its parts		117,311	117,311	9,412,412	85.6	31,423	(10,707)		(9,152) Subsidiary
	Innovative Nanotech Incorporated	Hsinchu, Taiwan	Monitoring instruments of nanoparticles		142,140	142,140	14,214,000	67.2	162,380	25,502		17,154 Subsidiary
	Touch Cloud Inc.	Taipei, Taiwan	Development of cloud platform and Internet of Things systems		110,457	57,000	11,045,667	83.1	57,768	(16,911)		(13,680) Subsidiary
	Adlink Technology Inc.	Taoyuan, Taiwan	Manufacturing, processing and retailing of software/hardware of		162,311	162,709	24,432,253	11.2	284,189	123,715		16,359 Associate
			computers and peripherals
	DynaScan Technology Corp.	Taoyuan, Taiwan	Research and manufacture of LED generators		238,746	238,746	9,841,112	27.3	152,662	77,424		21,137 Associate
	Camtek Ltd.	Israel	Automatic optical inspection equipment		2,342,340	2,342,340	7,817,440	17.8	2,674,510	1,688,298		267,521 Associate
	Chih Ho Shun Development Co., Ltd.	Taoyuan, Taiwan	Construction and development of residence, buildings and specialized field; construction and investment of public works		17,500	17,500	1,750,000	35.0	16,003	(1,787)		(888) Joint venture
Chroma ATE Inc.	Chroma Systems Solutions, Inc.	USA	Sale and maintenance of electronic test instruments, etc.		64	64	240,000	50.0	286,417	265,558		NA Subsidiary
Chroma ATE Europe B.V.	Chroma Germany GmbH	Germany	Sale and maintenance of electronic test instruments, etc.		1,073	1,073	30,000	100.0	1,611	1,559		NA Subsidiary
San Eagle Development Corp. Wei Kuang Mech. Eng. Inc.		Mauritius	Investment		185,686	185,686	4,475,000	100.0	979,516	69,743		NA Subsidiary
Adivic Technology Co., Ltd. Adivic Holding Corporation		Samoa	Sale and research of RF device		42,245	42,245	1,000,000	100.0	9,005	(31)		NA Subsidiary
Quantel Private Ltd.	Quantel Technologies India Private Ltd.	India	Sale and maintenance of test instruments, etc.		3,056	3,056	64,999	100.0	5,621	892		NA Subsidiary
	Quantel Global Vietnam Co., Ltd.	Vietnam	Sale and maintenance of test instruments, etc.		6,219	6,219	-	100.0	13,693	5,093		NA Subsidiary
	Quantel Global Sdn. Bhd.	Malaysia	Sale and maintenance of test instruments, etc.		4,199	4,199	600,000	100.0	16,330	7,319		NA Subsidiary
	Quantel Global Philippines Corporation	Philippines	Sale and maintenance of test instruments, etc.		610	610	99,095	100.0	6,994	3,052		NA Subsidiary
	Quantel Global Company Limited	Thailand	Sale and maintenance of test instruments, etc.		675	-	29,997	99.9	85	(568)		NA Subsidiary
	Chroma Investment Co., Ltd. Testar Electronics Corporation	Taoyuan, Taiwan	Testing of LED		11,250	11,250	4,500,000	15.0	31,620	133,023		NA Subsidiary

Note: For amounts that were translated from foreign currencies, the amount of the original investment was translated into New Taiwan dollars at the historical exchange rate, while the amount of net income (loss) of the investee and investment gain (loss) were translated into New Taiwan dollars at the average exchange rate for the year ended December 31, 2021. Other amounts were translated into New Taiwan dollars at the spot exchange rate on December 31, 2021.

INFORMATION ON INVESTMENTS IN MAINLAND CHINA FOR THE YEAR ENDED DECEMBER 31, 2021 (In Thousands of New Taiwan Dollars or Foreign Currency, Unless Stated Otherwise)

Investee Company	Main Businesses and Products	Paid-in Capital (Note 2)	Method of Investment (Note 1)	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2021 (Note 3)	Outward		Remittance of Funds Inward		Accumulated Outward Remittance for Investment from Taiwan as of December 31, 2021 (Note 3)	Net Income (Loss) of the Investee	Percentage of Ownership in Investment	Investment Gain (Loss) (Notes 4 and 5)	Carrying Amount as of December 31, 2021 (Note 2)	Accumulated Inward Remittance of Earnings as of December 31, 2021
Chroma Electronics (Shenzhen) Co., Ltd.	Sale of computerized automatic test systems, peripherals and electronic test instruments	\$ 106,470 (HK\$ 30,000)	b. Subsidiary of Neworld Electronics Limited	\$ 132,178 (HK\$ 1,200 US\$ 3,853)	\$	-	\$	-	\$ 132,178 (HK\$ 1,200 US\$ 3,853)	\$ 108,981	100	\$ 108,981	\$ 1,078,664	\$ 91,226 (RMB 21,156)
Chroma Electronics (Shanghai) Co., Ltd.	Sale of computerized automatic test systems, peripherals and electronic test instruments	83,040 (US\$ 3,000)	b. Subsidiary of Neworld Electronics Limited	101,993 (US\$ 3,000)		-		-	101,993 (US\$ 3,000)	95,798	100	95,798	319,603	-
Chroma (Shanghai) Trading Co., Ltd.	International and transit trading, commercial simple processing and commercial consulting service and etc.	74,736 (US\$ 2,700)	b. Subsidiary of Chen Hwa Technology Inc.	84,988 (US\$ 2,700)		-		-	84,988 (US\$ 2,700)	(347)	100	(347)	79,739	-
Hangzhou New Material Chroma Co., Ltd.	Production and sale of semiconductor connecting materials	41,520 (US\$ 1,500)	b. Subsidiary of Chen Hwa Technology Inc.	9,091 (US\$	285)	-		-	9,091 (US\$ 285)	88,401	19	-	17,079	12,065 (US\$ 368)
	Chroma ATE (Suzhou) Co., Ltd. Sale of computerized automatic test systems, peripherals and electronic test instruments	105,184 (US\$ 3,800)	b. Subsidiary of CHI Incorporation Ltd.	121,115 (US\$ 3,800)		-		-	121,115 (US\$ 3,800)	41,607	100	41,607	321,459	-
Wei Kuang Automatic Equipment (Nanjing) Co., Ltd.	Sale and maintenance of electronic equipment and factory conveyor systems	51,568 (RMB 11,871)	b. Subsidiary of Wei Kuang Mech. Eng. Inc.	43,751 (US\$ 1,338)		-		-	43,751 (US\$ 1,338)	43,473	100	43,473	251,294	-
Wei Kuang Automatic Equipment (Xiamen) Co., Ltd.	Sale and maintenance of electronic equipment and factory conveyor systems	49,595 (RMB 11,417)	b. Subsidiary of Wei Kuang Mech. Eng. Inc.	49,935 (US\$ 1,500)		-		-	49,935 (US\$ 1,500)	19,162	100	19,162	523,463	-
Mou Kuan Technologies (Nanjing) Co., Ltd.	Assembly, sale and maintenance of factory conveyors and related systems and renders related after-sales services	7,546 (RMB 1,737)	b. Subsidiary of Wei Kuang Mech. Eng. Inc.	92,000 (US\$ 2,836)		-		-	92,000 (US\$ 2,836)	565	100	565	19,289	47,504 (US\$ 1,552)
Sajet System Technology (Suzhou) Co., Ltd.	Research, development and design of computer network security systems and information management	36,377 (RMB 8,374)	b. Subsidiary of Deep Red Holding Co., Ltd.	(Note 9)		-		-	(Note 9)	22,622	100	22,622	147,068	-

Accumulated Outward Remittance for Investments in Mainland China as of December 31, 2021	Investment Amounts Authorized by the Investment Commission, MOEA	Upper Limit on the Amount of Investment Stipulated by Investment Commission, MOEA
\$635,051	\$725,060	\$11,108,346
(HK\$1,200, US\$19,312)	(HK\$1,400, US\$22,076) (Note 6)	(Note 7)

(Continued)

Note 1: Methods of investment have following type:

• a. Direct investment in mainland China.
• b. Indirect investment in mainland China through an existing company in a third region.
• c. Other

Note 2: The amounts of paid-in capital and carrying value as of balance sheet date were translated into the New Taiwan dollars at the rates of HK\$1=NT\$3.549, US\$1=NT\$27.680, RMB1=NT\$4.344 prevailing on December 31, 2021.

Note 3: The amounts of accumulated outflow of investment from Taiwan as of January 1, 2021 and December 31, 2021 were translated into the New Taiwan dollar on the original outflow day.

Note 4: Based on audited financial statements.

Note 5: Investment income (loss) was translated into the New Taiwan dollar at the average rate of HK\$1=NT\$3.603, US\$1=NT\$28.009, RMB1=NT\$4.341 for the year ended December 31, 2021.

Note 6:

	Approval Letter	Approved Amount
	a. Letter (1998) II-87710585 of Investment Commission of MOEA	NT\$	5,852	(HK\$	1,400)
	b. Letter (2000) II-89014726 and 89037430 of Investment Commission of MOEA		NT\$ 63,180	(US\$	2,000)
	c. Letter (2001) II-89037430 of Investment Commission of MOEA		NT\$ 33,160	(US\$	1,000)
	d. Letter II-91048640 of Investment Commission of MOEA		NT\$ 63,984	(US\$	1,853) (Note 8)
	e. Letter II-90025170 of Investment Commission of MOEA		NT\$ 60,240	(US\$	1,750)
	f. Letter II-092020235 of Investment Commission of MOEA		NT\$ 19,230	(US\$	560)
	g. Letter II-092043358 of Investment Commission of MOEA	NT\$	6,748	(US\$	200)
	h. Letter II-093004076 of Investment Commission of MOEA	NT\$	3,158	(US\$	95)
i.	Letter II-094006092 of Investment Commission of MOEA	NT\$	6,896	(US\$	219)
j.	Letter II-09500052120 of Investment Commission of MOEA		NT\$ 81,528	(US\$	2,500)
	k. Letter II-09600175700 of Investment Commission of MOEA		NT\$ 120,000	(US\$	3,699)
l.	Letter II-096000006020 of Investment Commission of MOEA		NT\$ 66,580	(US\$	2,000)
	m. Letter II-09600310110 of Investment Commission of MOEA		NT\$ 33,160	(US\$	1,000)
	n. Letter II-09700186010 of Investment Commission of MOEA		NT\$ 46,110	(US\$	1,500)
	o. Letter II-09700403210 of Investment Commission of MOEA	NT\$	7,096	(US\$	210) (Note 9)
	p. Letter II-10400042770 of Investment Commission of MOEA		NT\$ 78,240	(US\$	2,500)
	q. Letter II-10600164500 of Investment Commission of MOEA		NT\$ 29,898	(US\$	990)

Note 7: The upper limit on investment was calculated in accordance with the regulations of the Investment Commission of the Ministry of Economic Affairs for 60% of the net equity or consolidated net equity.

Note 8: The Corporation invested accounts receivable amounting to US\$853 thousand in Chroma Electronics (Shenzhen) Co., Ltd. through Neworld Electronics Limited

Note 9: The investment in Sajet Technology Inc. (liquidated on September 15, 2008) was authorized by the Investment Commission in 2004.

(Concluded)