CHROMA — Annual Report 2021

Aug 11, 2022

• I. Spokesperson of Chroma ATE Inc.

Name: Paul Ying

Title: Senior Vice President of Finance & Administration Center

TEL: (03) 327-9999 ext. 82001

Email: paul.ying@chroma.com.tw Deputy spokesperson of Chroma ATE Inc.

Name: Jennifer Chien

Title: Director TEL: (03) 327-9999 ext. 82701 Email: jennifer@chroma.com.tw

II. Addresses and telephone numbers of head office, branches and plants Head Office: No. 88, Wenmao Rd., Guishan Dist., Taoyuan City 333001, Taiwan TEL: (03)327-9999

Taoyuan Huaya plant: 68 Huaya 1st Rd., Guishan Dist., Taoyuan 333411, Taiwan

TEL: (03)327-9999

Hsinchu Branch: 6F, No. 5, Technology Rd., Science Park, Hsinchu City 300092, Taiwan TEL: (03)563-5788

Kaohsiung Branch: No. 1, Neihuan E. Rd., Nanzi Dist., Kaohsiung City 811623, Taiwan TEL: (07)365-6188

• III. Stock transfer agent

Name: Taishin Securities Co., Ltd.

Address: B1, No.96 Jianguo North Road, Sec. 1, Taipei City 104496, Taiwan Website: https://www.tssco.com.tw

TEL: (02)2504-8125

• IV. Attesting Certified Public Accountants (CPAs) for the most recent financial statements

Name: CPAs Wen-Chin Lin, Chien-Liang Liu

Name of accounting firm: Deloitte & Touche Address: 20F, No. 100, Songren Rd., Xinyi Dist., Taipei City 110016, Taiwan Website: http://www.deloitte.com.tw

TEL: (02) 2725-9988

• V. The name of any exchanges where the Company's securities are listed offshore, and the method by which to access information on the offshore securities: None.

• VI. Company website: https://www.chromaate.com

Critical financial indicators (consolidated)

		Unit：NT$ million	Unit：NT$ million
	2019	2020	2021
Consolidated net operating revenues	13,910	15,533	17,584
Net income(attributable to the parent Corporation)	1,854	2,324	4,179
Earnings per share（NT$）	4.48	5.56	9.96
Capital stock	4,193	4,213	4,219
Total assets	25,437	28,129	29,546
Total equity	14,785	16,389	18,947
Return on total assets	7.80	8.85	14.62
Return on total equity	12.83	15.21	24.17

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Earnings per share for
Net income for the 5 most
Consolidated net operating the 5 most years
revenues for the 5 most recent years 4800 recent years 11.0 9.96
20000 4500 4179 10.0
19000 17584 4200
18000 16931 9.0
3900
17000 15533
16000 14901 3600 8.0
15000 13910 3300
14000 3000 7.0 6.41 6.22
1300012000 2700 2558 2546 2324 6.0 5.56
1100010000 24002100 1854 5.0 4.48
9000
8000 1800 4.0
7000 1500
6000 3.0
1200
5000
4000 900 2.0
3000 600 1.0
2000
300
1000
0 0 0.0
2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021
Unit : NT$
Unit ：NT$ million Unit：NT$ million
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Table of Contents

Chapter 1 Reports to Shareholders ...................................................................................................... 1

Chapter 2 Company Introduction	Chapter 2 Company Introduction
I.	Founding date ...................................................................................................................... 2
II.	Company history ................................................................................................................. 2
Chapter 3 Corporate Governance Report
I.	Organizational system ......................................................................................................... 4
II.	Directors, CEO, general managers, vice presidents, assistant vice presidents, and
	heads of departments and branches ..................................................................................... 6
III.	Total remuneration paid to directors, CEO, and vice presidents in the most recent
	year .................................................................................................................................... 13
IV.	Operation of corporate governance ................................................................................... 18
V.	Information on the CPAs’ professional charge ................................................................. 48
VI.	Replacement of CPAs ....................................................................................................... 49
VII.	The Company's Chairman, CEO, or any managerial officer in charge of finance or
	accounting matters who has held a position at the accounting firm of the attesting
	CPAs or its affiliated companies in the most recent year ................................................. 50
VIII. Shareholding transfer and equity pledge changes of directors or managerial officers
	holding more than ten percent (10%) of Company shares during the most recent
	year up to the publication date of this annual report ......................................................... 50
IX.	Information on the ten largest shareholders who are related parties or each other's
	spouses and relatives within the second degree of kinship ............................................... 52
X.	Number of shares held and percentage of the stake of investment in other companies
	by the Company, the Company’s director, managerial officer, or an entity directly
	or indirectly controlled by the Company .......................................................................... 53
Chapter 4 Capital Raising
I.	Capital and shares ............................................................................................................. 55
II.	Corporate bond .................................................................................................................. 63
III.	Preferred shares ................................................................................................................. 63
IV.	Overseas depositary receipt .............................................................................................. 63
V.	Employee stock options .................................................................................................... 64
VI.	New employee restricted stocks ........................................................................................ 65
VII.	Issuance of new shares in connection with the merger or acquisition of other companies66
VIII. Implementation of capital utilization plan ........................................................................ 66
Chapter 5 Operation summary
I.	Business content ................................................................................................................ 67
II.	Market, production, and sales summary ........................................................................... 76
III.	Employee information in the two most recent years up to the publication date of this
	annual report ..................................................................................................................... 82
IV.	Environmental protection expenditure .............................................................................. 83
V.	Labor relations .................................................................................................................. 83
VI.	Cyber security management .............................................................................................. 85

VII. Important contracts ........................................................................................................... 87

Chapter 6 Financial summary
I. Condensed balance sheet and statement of comprehensive income in the five most
recent years ....................................................................................................................... 88
II. Financial analysis in the five most recent years ................................................................ 91
III. Audit Committee's audit report on financial statements in the most recent year .............. 94
IV. Financial statements in the most recent year .................................................................... 95
V. The Company's parent company-only financial statements audited and attested by
CPAs in the most recent year ............................................................................................ 95
VI. Financial conditions of the Company and affiliated companies ....................................... 95

Chapter 7 Review, analysis, and risks of financial position and performance	Chapter 7 Review, analysis, and risks of financial position and performance
I.	Financial condition ............................................................................................................ 96
II.	Financial performance ....................................................................................................... 97
III.	Cash flow .......................................................................................................................... 98
IV.	Impact of material expenditures on the Company's finances and operations in the
	most recent year ................................................................................................................ 98
V.	Investment policies in other companies, the main reasons for profit/losses,
	improvement plan, and investment plans for the upcoming year
	. .......................................................................................................................................... 99
VI.	Risk analysis and assessment for the most recent year up to the publication date of
	this annual report ............................................................................................................... 99
VII.	Other important matters .................................................................................................. 104
Chapter 8 Special Notes
I.	Information on affiliated companies ............................................................................... 105
II.	Private placement of securities in the most recent year up to the publication date of
	this annual report ............................................................................................................. 111
III.	Holding or disposition of the Company's shares by subsidiaries in the most recent
	year up to the publication date of this annual report ....................................................... 111
IV.	Other supplementary matters .......................................................................................... 111
V.	Any event that results in substantial impact upon the shareholders’ equity or prices of
	the Company’s securities as prescribed by Article 36, Paragraph 3, Subparagraph 2 of
	the Securities and Exchange Act that have occurred in the most recent year up to the
	publication date of this report.
	. ........................................................................................................................................ 111

Chapter 1 Reports to Shareholders

Business Results

In 2021, with the continuation of the Covid-19 pandemic and the spread of the Delta virus, all parts of the world and especially Asian regions have experienced various preventive measures, including shutdowns and local or national lockdowns. The entire manufacturing industry has felt the impact, and suffered from severe shortages of materials and labor, as well as soaring freight costs. Inevitably, the company was also affected from the second half of the year. In the face of this serious predicament, our employees remained fearful yet eager to overcome the difficulties, and still managed to generate a record-high revenue. The operating revenue of Chroma ATE Inc. in 2021 was NTD 10.308 billion, while the Chroma Group revenue was NTD 17.584 billion. Including the sale of the Taoyuan plant, the total net profit amounted to NTD 4.179 billion. Earnings per share equaled to NTD 9.96.

The company's overall product revenue on test equipment grew by 16% over the past year. Especially the semiconductor and photonics test systems contributed greatly, with the continuously growing demand for HPC and 5G communication as well as the strong expansion of the Chinese semiconductor market backed by government policies leading to a 19% increase in revenue. The revenue of power electronic test equipment has also been growing steadily by 14%, since the vigorous development of electric vehicles throughout the world has stimulated the demand for testing related components. Within the Chroma Group, MAS Automation has seen flat revenue, the main reason being the slow growth of the solar industry market. Nevertheless, overall group revenue still increased by a solid 13%. Other relevant consolidated financial figures are as follows:

Financial Performance for Year 2020 ~ 2021

	Items	2021	2020
Financial Structure (%)	Debt to Assets Ratio (%)	35.87	41.74
	Long-term Fund to Fixed Assets Ratio (%)	355.40	624.21
Solvency (%)	Current Ratio (%)	186.87	160.57
	Quick Ratio (%)	133.86	122.28
Profitability (%)	Return on Assets (%)	14.62	8.85
	Return on Equity (%)	24.17	15.21
	Profit Margin (%)	23.77	14.96

Business plan, development strategies, external competition and environment, legal environment, and macro-business environment

Looking forward to 2022, we hope that the global epidemic will gradually ease along the raising vaccination rates. From the second half of the year, we expect the shortage of labor and materials to gradually return to the right track, and the global economy to recover. The company welcomes these developments and takes the following measures to overcome the current difficulties, seize the business opportunities brought by the economic recovery, and continue on the road of record high revenue and profit.

1. Actively and properly address the impact of labor and material shortages to meet customer demands.

2. Expedite test solution developments for advanced semiconductor processes, HPC, 5G, and other high-end semiconductor applications.

3. Provide relevant test turnkey solutions in close cooperation with 1st Tier customers. Finally, we would like to express our gratitude to all our shareholders for their unstinted support and encouragement. We wish everyone good health and all the best!

Chairman & CEO Leo Huang

• 1 -

Chapter 2 Company Introduction

I. Founding date: November 8, 1984

II. Company history:

mpany history:
November 1984	Founded in Taipei City with a capital of NT$2 million.
	Launched the first Taiwanese-invented programmable video signals generator
	(65MHz).
November 1986	Released the world’s first automated test system with simultaneous and parallel
	testing architecture for switched-mode power supplies.
February 1993	Invested in U.S. subsidiary Chroma ATE Inc., as a sales office based in the United
	States.
December 1993	Official opening of the new Wugu plant.
February 1994	Invested in the establishment of Hong Kong subsidiary Neworld Electronics
	Limited as a base for expanding into the Chinese market.
December 1994	Granted the ISO9002 quality certification.
November 1995	Gained the Chinese National Laboratory Accreditation (CNLA).
December 1996	The Company's shares were listed and traded on TWSE on December 21.
August 1997	Granted the ISO9001 quality certification.
December 1997	Received the 6th Taiwan Excellence Award for the 9107 Uninterruptible Power
	Supply and the 3203 Memory IC Test System..
April 1998	Received the Outstanding Performance Award during the 6th MOEA Indust
	Technology Development Award.
	Invested in DynaScan Technology Corp.
July 1998	Received the 2nd Outstanding Photonics Product Award for the 7100 Colour Analys
September 1998	Invested in ADLINK Technology Inc.
December 1998	2225 Series and 2325 Series Video Pattern Generator with 9105 uninterruptible
	Power Supply received the 7th Taiwan Excellence Award..
May 1999	Received the Excellent Product Design Award for the 9105/9107 Uninterruptible
	Power Supply.
June 1999	Acquired Hita Technology Co., Ltd.
September 1999	Established Chroma ATE Europe B.V. subsidiary in the Netherlands as a sales
	office in the European market.
November 1999	Grand opening of the new Taoyuan plant.
June 2000	Issuance of the first domestic unsecured convertible bonds in NT$1,500,000,000.
August 2000	Invested in EVT Technology Co., Ltd.
January 2001	Acquired Zentech Tech Inc.
March 2003	Set up a branch office in Hsinchu Science Park.
September 2003	Set up the global headquarters in Taiwan.
December 2004	20th anniversary of the Company and grand opening of the Taoyuan headquarters.
June 2005	The first domestic unsecured convertible bonds expired and terminated from OTC
	listing.
August 2006	Spun off the Special Material business unit as new subsidiary, Chroma New Material Corp.
January 2007	Invested in Wei Kuang Automatic Equipment (Nanjin) Co., Ltd., Mou Kuan
	Technologies (Nanjin) Co. Ltd., Sajet Technology Co., Ltd., and MAS Automation
	Corp.
February 2007	Invested in Wei Kuang Automatic Equipment (Xiamen) Co., Ltd.
March 2007	Invested in Testar Electronic Corporation.
April 2007	Established the MES business unit.
March 2008	Simple merger of subsidiary Silver Town Electronic Co., Ltd.
May 2008	Invested in the establishment of Chroma Japan Corp.
March 2009	Granted ISO 9001:2008 certification.
September 2009	Established the Kaohsiung branch.
September 2009	Invested in Chroma Systems Solutions, Inc. as a sales office based in the United
	States.

• 2 -

August 2010 Received Finance Awards as the Best Managed Company, the Best Corporate Governance, and the Best Mid-cap Company in Taiwan. October 2010 Granted ISO/TS 16949 certification. August 2011 Acquired Wise Life Technology Co., Ltd. January 2012 Acquired the tender for the Industrial Development Zone (Tender A) in the Taoyuan International Airport Access MRT Station A7 Transit-Oriented Development Zone. January 2012 Received the Excellent Industrial Contribution Award for the LED 2D CCD Light Bar Test System in the 2011 MOEA Technical Excellence Program. November 2012 Simple merger of subsidiary Novatest Electronics Co., Ltd. December 2012 Acquired the world’s first SAE J1772 certification from UL for automated communication protocol test system. February 2013 Received the 1st MOEA Taiwan Mittelstand Award. February 2013 Invested in Adivic Technology Co. May 2014 Issuance of the second domestic unsecured convertible bonds in NT$ 2 billion. January 2016 Invested in Quantel Private. Ltd. in Singapore as a Southeast Asia branch. January 2017 Received the Distinguished Enterprise Innovation Award, the highest honor available from the 5th National Industrial Innovation Award. August 2017 Established Innovative Nanotech Incorporated. September 2017 Established subsidiary Chroma Germany GmbH in Germany. October 2017 Invested in Touch Cloud Inc. October 2017 Received the “Best Trade Contribution Award” from MOEA. January 2018 Received the 26th Taiwan Excellence Award for the 61800 Series Regenerative Grid Simulator and 3160-C Tri-Temp Quad Sites Handler. February 2018 Established Chroma Korea as a branch office in South Korea. January 2019 Received the 27th Taiwan Excellence Award for the “17040 Regenerative Battery Pack Test System" and "2238 Video Pattern Generator". February 2019 Invested in Camtek Ltd. in Israel. September 2019 Approved the joint housing construction with Fu Yu Construction. October 2019 Ranked among “2019 Top 35 of the MOEA Best Taiwan Global Brands”. November 2019 Awarded Bronze at 12th TSCA Taiwan Corporate Sustainability Report Awards. November 2020 Ranked among “Top 40 of the MOEA Best Taiwan Global Brands” for 2020. December 2020 Headquarters relocation and expansion. November 2021 Awarded Bronze at 2021 TSCA Taiwan Corporate Sustainability Report Awards. December 2021 Ranked among “Top 40 of the MOEA Best Taiwan Global Brands” for 2021. December 2021 Established the Chroma Cultural and Educational Foundation. January 2022 Invested in Environmental Stress Systems, Inc.

• 3 -

Chapter 3 Corporate Governance Report

I. Organizational system

• (I) Organizational structure

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• 4 -

(II) Responsibilities and functions of main departments

Department	Responsibilities
CEO Office	Set up market planning center, Legal Affairs Dept., and Safety & Health Center. Formulate Corporation-wide administrative and business objectives, implement communication and coordination, product planning, new business development and planning, patent management, contract review environmental protection, and occupation safety and health (OSH) management.
Internal Auditor	Establish, update, and revise internal audit and control systems. Review, revise, and audit internal control systems.
Semiconductor Test Equipment BU	Responsible for the planning, research, and development (R&D), and marketing of semiconductor test equipment and products.
Test & Measurement BU	Responsible for the R&D and marketing of measurement instruments. In charge of calibration services as well as operations of calibration labs for measurement instruments.
Integrated System Solution BU	Responsible for the R&D and sales of MES systems. Responsible for the planning, R&D, and marketing of modular instruments and products. Responsible for the planning, R&D, and marketing of integrated system solutions.
Intelligent Manufacturing System BU	Responsible for the R&D and marketing of MES systems.
Optical Inspection Solution BU	Responsible for the R&D and marketing of optical inspection systems.
Manufacturing Center	Responsible for purchase of raw materials and production for the entire Corporation. Responsible for the planning and maintenance of product quality systems.
Advanced Technology Research Center	New technology planning, development, and supporting the business units (BU) to comprehend the future development of new industries.
Finance & Administration Center	Consists of the Financial Division, Accounting Division, HR Division, General Affairs Department, and Facilities Department Financial Division: Responsible for capital planning and utilization for the entire Corporation, assessing investment plans, and providing support for certain operations. Accounting Division: Responsible for establishing and implementing an accounting system, and handling various taxation and accounting affairs. HR Division: Planning HR resources, organizational development, and training for the entire Company. General Affairs Department: Responsible for the purchase of routine equipment and items, as well as the management of equipment and fixed assets for the entire Corporation. Facilities Department: Responsible for factory maintenance and safety.
Operation Management Center	Responsible for building and managing the Company's operations management system. Establish the IT Division (including the IT System Development Department, the IT System Management Department, and the Data Control Department), carry out planning and safety controls for IT equipment and application systems throughout the entire Corporation, and issuance and control of rules and regulations.

• 5 -

II. Directors, CEO, general managers, vice presidents, assistant vice presidents, and heads of departments and branches (I) Director Information

																April 11,	April 11,	April 11,	2022
Position title	Nationality or place of registration	Name	Gender and age	Date elected	Final date of term of office	Date first elected	Number of shares held when elected		Number of shares currently held		Shares held by spouse or minor children		Shareholding in the name of others//shareho lding percentage	Major experience/academic background	Positions currently assumed in the Company or other corporations	Any managerial officer, director, or supervisor who is a spouse or relative within the second degree of kinship			Remark
							Number of shares	Shareholding percentage	Number of shares	Shareholding percentage	Number of shares	Shareholding percentage				Position title	Name	Relations
Chairperson	Republic of China	Leo Huang	Male 71~80	2020.06.10	2023.06.09	1984.10.23	20,763,897	4.94%	20,859,897	4.94%	9,294,362	2.20%	0	Electronics Engineering Department, National Chiao Tung University President, Kemao	CEO of the Company Director, I-Sheng Electric Wire & Cable Co., Ltd. Director, Leadtek Research Inc. Independent Director, Ichia Technology Inc. Representative of Corporate Director, Tian Zheng International Precision Machinery Co., Ltd. Director, Twoway Communications, Inc. Chairperson, DynaScan Technology Corp. Refer to page 107 -109 for details on positions assumed in affiliated companies	None	None	None	Note 1
Director	Republic of China	I-Shih Tseng	Male 61~70	2020.06.10	2023.06.09	2012.06.06	424,548	0.10%	240,548	0.06%	25,722	0.01%	300,000/ 0.07%	PhD, Mechanical Engineering, Pennsylvania State University Project Manager, Institute for Information Industry	General Manager of the Company Refer to page107-109 for details on positions assumed in affiliated companies	None	None	None	None
Director	Republic of China	Tsun-I Wang	Male 71~80	2020.06.10	2023.06.09	2005.05.18	19,339	0	19,000	0	0	0	0	Ph.D., Institute of Electro-Engineering, National Chiao Tung University Vice President, Tailyn Technologies, Inc. Vice President, Champion-Lighting Technologies Limited Director of Hua Eng Optoelectronics Research Institute Dean of Electronics Department, Minghsin University of Science and Technology	Chief Technology Officer, DynaScan Technology Corp. Independent Director, Dynapack International Technology Refer to page 107-109 for details on positions assumed in affiliated companies	None	None	None	None
Director	Republic of China	Chung- Ju Chang	Male 71~80	2020.06.10	2023.06.09	2012.11.01	0	0	0	0	0	0	0	Ph.D., of Electrical Engineering, National Taiwan	Lifetime Chair Professor, Department of Electrical Engineering, National Chiao Tung University Director, Ting-Shiun Telecommunication Development Foundation Director, National Information Infrastructure Enterprise Promotion Association	None	None	None	None
														University
														Chair Professor, Department of Electrical and Computer Engineering, National Chiao Tung University Vice President for R&D, Office of Research and Development, National Chiao Tung University Dean and Director of the Institute of Communications Engineering, National Chiao Tung University Review committee member, MOEA Leading Projects/Industrial Technology Projects Technology advisor, MOE
														Technologyadvisor,MOTC
Independent Director	Republic of China	Tai-Jen George Chen	Male 71~80	2020.06.10	2023.06.09	2017.06.08	0	0	0	0	0	0	0	Department of Atmospheric Sciences, State University of New York, USA Academic Vice President of National Taiwan University Vice President for Academic Affairs, National Taiwan University Professor, Department of Atmospheric Sciences, National Taiwan University	National Taiwan University Chair Professor Independent Director, Ichia Technology Inc.	None	None	None	None

• 6 -

Independent Director	Republic of China	Jia-Ruey Duann	Male 61~70	2020.06.10	2023.06.09	2020.06.10	0	0	0	0	0	0	0	Ph. D., Physics North Dakota State University Harvard Business School Advanced Management Program Assistant vice president, ITRI Director of Measurement Technology Development Center, ITRI Group leader and deputy director of Measurement Technology Development Center, ITRI Adjunct Professor, Department of Physics, Chung Yuan Christian University President of Automatic Optical Inspection Equipment Alliance Assistant Researcher of Precision Instrument Development Center, National Science Council /Plant manager of optical devices	Distinguished Expert, ITRI CIE-Taiwan President	None	None	None	None
Independent Director	Republic of China	Steven Wu	Male 51~60	2020.06.10	2023.06.09	2020.06.10	0	0	0	0	0	0	0	MBA, Georgetown University Vice President, Private Equity Business Department of CDIB Capital Group	Vice President and department head, Private Equity Business Department of CDIB Capital Group Board Director of Anhui Dongjin Resources Recycling Technology Co., Ltd. Board Director of Jiangyin Tongli Optoelectronic Technology Co., Ltd Board Director of Jiangyin Suda Huicheng Composite Materials Co., Ltd. Board Director of Jiangsu Junhui Optoelectronics Technology Co., Ltd. Board Director of Dongjin Environmental Technology Co., Ltd. Vice-Chairman of JINTEX Corporation Ltd. Chairman of Prime Express International Limited Board Director of Billion View Investments Limited Managing Director of CDIB Capital International Corporation Board Director of Dongjin Green Tech Holdings Co., Ltd. Board Director of Great Rich Technologies Limited Board Director of Prime Express Holdings Limited	None	None	None	None
Note 1: If the Chairperson of the Board and the president or their equivalent (chief managerial officer) are the same person, each other’s spouse, or a relative of the first degree of kinship, the reason, reasonableness, necessity, and response measures (e.g. increase the number of independent directors and more than half of the directors do not concurrently serve as employees or managerial officers) shall be stated: (1) The Chairperson of the Company holds the concurrent position as the president to enhance the overall operating efficiency and decision-making of the Group. In order to reinforce the independence of the Board, the Company has set up three independent directors, representing 3/7 of the total number of directors of the Company.

(2) In order to enhance the functions of the Board of Directors and strengthen its supervisory function, the Company has the following measures in place: 1. A majority of the Board members are not also managerial officers or employees. 2. The three independent directors of the Company have extensive working experience in finance, investment, talents and electronic technology, respectively, and can carry out their supervisory functions effectively. 3. Members of the Audit Committee and the Remuneration Committee of the Company consist of independent directors, and all committees can thoroughly discuss and make recommendations for the Board’s decision to implement corporate governance.

• 7 -

1. Professional qualifications of directors and information on independence of independent directors (1) Professional qualifications and experience of directors	1. Professional qualifications of directors and information on independence of independent directors (1) Professional qualifications and experience of directors
Name Chairperson/ Leo Huang Director/ I-Shih Tseng Director/ Tsun-I Wang Director/ Chung-Ju Chang Independent director/ Tai-Jen George Chen Independent director/ Jia-Ruey Duann Independent director/ Steven Wu	Professional qualifications and experiences
	Graduated from the Electronics Engineering Department, National Chiao Tung University Currently Chairman and CEO of the Company and a director of several TWSE-listed companies including Leadtek Research Inc. with more than five years of experience in electronic information technology, marketing, strategic planning and operation management.
	Ph.D., Mechanical Engineering, Pennsylvania State University Currently director of Integrated System Solution BU and Optical Inspection Solution BU of the Company, with more than five years of professional experience in electronic information technology and management.
	Ph.D., Institute of Electro-Engineering, National Chiao Tung University Currently Chief Technology Officer of, DynaScan Technology Corp. and Independent Director of, Dynapack International Technology, with at least five years of professional and operational management experience in electronic information technology.
	Ph.D., of Electrical Engineering, National Taiwan University
	Formerly a professor in the Department of Electrical Engineering at National Chiao Tung University, specializing in electrical engineering, with more than five years of professional qualifications as a professor at a public university in the relevant disciplines required for company business.
	Graduated from the Department of Atmospheric Sciences, State University of New York, USA The convener of the Remuneration Committee and a member of the Audit Committee of the Company, formerly Independent Director, of Ichia Technology Inc., and Academic Vice President of National Taiwan University with at least five years of professional and talent management qualifications in the field of atmospheric sciences.
	Ph.D., Physics, North Dakota State University A member of the Remuneration Committee and Audit Committee of the Company, independent director of Powertip Tech Corp., formerly an assistant vice president, ITRI with more than five years of experience in the electronic technology industry and talent management.
	MBA, Georgetown University The convener of the Audit Committee and a member of the Remuneration Committee of the Company, currently Vice President and department head of, Private Equity Business Department of CDIB Capital Group, with at least five years of experience in financial investment and asset management.

(2)Information on the independence of independent directors

Name	Where none of the circumstances in the subparagraphs of Article 30 of the Company Act apply.	Status of Independence (Note 1)	Status of Independence (Note 1)	Status of Independence (Note 1)	Status of Independence (Note 1)	Status of Independence (Note 1)	Status of Independence (Note 1)	Status of Independence (Note 1)	Status of Independence (Note 1)	Status of Independence (Note 1)	Status of Independence (Note 1)	Status of Independence (Note 1)	Number of other public companies in which the individual is concurrently serving as an independent director
		1	2	3	4	5	6	7	8	9	10	11
Chairman/LeoHuang	V												1
Director/I-Shih Tseng	V												0
Director/Tsun-IWang	V												1
Director/Chung-JuChang	V												0
Independent director/ Tai-JenGeorge Chen	V	V	V	V	V	V	V	V	V	V	V	V	1
Independent director /Jia- Ruey Duann	V	V	V	V	V	V	V	V	V	V	V	V	1
Independent director / StevenWu	V	V	V	V	V	V	V	V	V	V	V	V	0

Note 1: Please check “ ✓ ” the corresponding boxes if the independent directors meet the following conditions during the two years prior to the nomination and during the term of office.

• (1) Not an employee of the Company or any of its affiliates.

(2) Not a director or supervisor of the Company or any of its affiliates. Not applicable in cases where the person is an independent director of the Company, its parent company, or any subsidiary as appointed in accordance with the Company Act or with the laws of the country of the parent or subsidiary.

• 8 -

• (3) Not a natural-person shareholder who holds shares, together with those held by the person’s spouse, minor children, or held by the person under others’ names, in an aggregate amount of 1% or more of the total number of outstanding shares of the Company or is ranked in the top 10 in shareholdings.

• (4) Not a managerial officer in (1) or a spouse, relative within the second degree of kinship, or lineal relative within the third degree of kinship, of any of the persons in (2) and (3).

• (5) Not a director, supervisor, or employee of a corporate shareholder that directly holds 5% or more of the total number of issued shares of the company or of a corporate shareholder that ranks among the top 5 in shareholdings or a director, supervisor, or employee of a corporate shareholder who is appointed as a director or supervisor of the Company per paragraph 1 or 2 of Article 27 of the Company Act. Not applicable in cases where the person is an independent director of the Company, its parent company, or any subsidiary as appointed in accordance with the Act or with the laws of the country of the parent or subsidiary.

• (6) Not a director, supervisor, or employee of another company that holds director seats in the Company or more than half of the shares with voting rights and is controlled by the same person. Not applicable in cases where the person is an independent director of the Company, its parent company, or any subsidiary as appointed in accordance with the Act or with the laws of the country of the parent or subsidiary.

• (7) Not a director (a member of the governing Board), supervisor (a member of the supervising Board) or employee of a company or institution which is the same person or spouse as the Chairperson, president or equivalent of the Company. Not applicable in cases where the person is an independent director of the Company, its parent company, or any subsidiary as appointed in accordance with the Act or with the laws of the country of the parent or subsidiary.

• (8) Not a director (a member of the governing Board), supervisor (a member of the supervising Board), managerial officer, or shareholder who holds more than 5% of the shares of a specified company or institution that has a financial or business relationship with the Company. Not applicable in cases where the specified company or institution holds more than 20% and not more than 50% of the total number of issued shares of the Company and the person is an independent director of the Company, its parent company, or any subsidiary as appointed in accordance with the Act or with the laws of the country of the parent or subsidiary.

• (9) Not a professional individual or owner, partner, director (a member of the governing Board), supervisor (a member of the supervising Board), managerial officer and his/her spouse of a professional, sole proprietorship, partnership, company, or institution that provides audit services to the Company or an affiliated enterprise or has received remuneration in the two most recent years not exceeding NT$500,000 for business, legal, financial and accounting related services. However, members of the special committee on remuneration, public acquisition review, or merger and acquisition who perform their functions and powers in accordance with the provisions of the Securities and Exchange Act or Business Mergers and Acquisitions Act and other relevant regulations shall not be subject to this provision.

• (10) Not having a marital relationship, or a relative within the second degree of kinship to any other director of the Company.

• (11) Where the person is not elected in the capacity of the government, a juristic person, or a representative thereof as provided in Article 27 of the Company Act

• Diversity policy and independence of the Board of Directors

• In order to strengthen corporate governance and promote the sound composition of the Board of Directors, the Company considers diversity for the composition of the Board of Directors. In addition to the fact that the number of directors who are also managerial officers of the Company shall not exceed one-third of the Board of Directors, the Company follows an appropriate diversity policy for the election of Board members in accordance with its operation, business model and development needs. In order to achieve the desired objectives of corporate governance, Article 20 of the Corporate Governance Best Practice Principles states that the Board of Directors as a whole should have competency in the following areas: (1) Operations. (2) Accounting and financial analysis. (3) Business management. (4) Crisis management. (5) Industry knowledge (6) International market perspective. (7) Leadership (8) Decision-making. Diversity of the Board of Directors: The Company is in the electronic measurement instrument industry with a wide range of products and is R&D technology-intensive with rapid changes in downstream industries. Therefore, in order to make forward-looking decisions, many of the Board members have many years of experience in the information electronics industry. In addition, the Company's R&D manpower accounts for one-third of the Company's manpower, so human resources management is important. Many of our Board members are experienced in operations and human resources management. In addition, the Company has a number of management and financial investment professionals in the Board of Directors.

In summary, the Company's Board of Directors is diversified in age and expertise from 50 to 75 years old, and its decision making quality is balanced as a result of its multifaceted nature. Gender diversity will be set as a target for the next re-election.

The Company's Board of Directors consists of seven directors, including three independent directors, whose terms of office have not exceeded three terms and of whom each has a different professional background and is fully independent The Board of Directors is independent: none of the seven directors are related to each other within two degrees, and there are no cases as stipulated in paragraph 3, Article 26-3 of the Securities and Exchange Act.

• 9 -

Core items of diversity Name of director			Basic composition	Basic composition	Basic composition	Basic composition					Competency	Competency
	Nationality	Gender		Age		Concurrently serving as an employee of the Company	Years of service as an independent director		Industry Knowledge	Business management	Technology	Marketing	Human resources management	Finance
			51 to 60	61 to 70	71 and above		Less than 3 years	3 to 6 years
Chairperson/ LeoHuang	Republic ofChina	Male			V	V			V	V	V	V	V	V
Director/ I-Shih Tseng	Republic ofChina	Male		V		V			V	V	V	V	V	V
Director/ Tsun-IWang	Republic ofChina	Male			V				V	V	V		V
Director/ Chung-Ju Chang	Republic of China	Male			V				V	V	V		V
Independent director/ Tai-Jen George Chen	Republic of China	Male			V			V	V	V	V		V
Independent director/ Jia-RueyDuann	Republic ofChina	Male		V			V		V	V	V		V
Independent director/ StevenWu	Republic ofChina	Male	V				V		V	V		V	V	V

• 10 -

April 11, 2022

(II) CEO, general managers, vice presidents, assistant VPs, and heads of various departments and branches

Position title	Nationality	Name	Gender	Date of assuming position	Shares held	Shares held	Shares held by spouse or minor children	Shares held by spouse or minor children	Shareholding in the name of others	Shareholding in the name of others	Major experience/academic background	Positions currently assumed in other companies	Any managerial officer who is a spouse or a relative within the second degree of kinship	Any managerial officer who is a spouse or a relative within the second degree of kinship	Any managerial officer who is a spouse or a relative within the second degree of kinship	Remark
					Number of shares	Shareholding percentage	Number of shares	Shareholding percentage	Number of shares	Shareholding percentage			Position title	Name	Relations
CEO	Republic of China	Leo Huang	Male	1984.11.08	20,859,897	4.94%	9,294,362	2.20%	0	0	Electronics Engineering Department, National Chiao Tung University	Director of Sheng Industrial (Stock Co.) Corporation, Director of Leadtek Technology Corporation, Independent Director of Yi Jia Technology (Stock Co.), Representative of Legal Person Director of Tianzheng International Precision Machinery Co., Ltd., and Director of Dayun Optoelectronics Co., Ltd. Guangyuan Technology (Co.) Chairman Refer to page 107-109 for details on positions assumed in affiliated companies	None	None	None	Note 2
CEO, Test & Measurement BU	Republic of China	David Yang	Male	1992.08.14	54,000	0.01%	0	0	0	0	Electronics Engineering Department, National Chiao Tung University Teaching Assistant, Department of Information Technology, College of Engineering, ChungHua University	Refer to page107-109 for details on positions assumed in affiliated companies	None	None	None	None
CEO of Integrated System Solution BU and concurrently CEO of Optical Inspection Solution BU	Republic of China	I-Shih Tseng	Male	1998.07.16	240,548	0.06%	25,722	0.01%	300,000	0.07%	Mechanical Engineering, Pennsylvania State University, US Project Manager, Institute for Information Industry	Refer to page107-109 for details on positions assumed in affiliated companies	None	None	None	None
President, Intelligent Manufacturing System BU	Republic of China	Joe Lin	Male	2007.04.01	88,743	0.02%	0	0	0	0	Department of Information Sciences, Cal Poly Pomona President, Sajet Technology Co., Ltd.	Refer to page 107-109 for details on positions assumed in affiliated companies	None	None	None	None
President, Semiconductor Test Equipment BU	Republic of China	George Chang	Male	2006.08.01	40,400	0.01%	0	0	0	0	Electrical and Control Engineering Department, National Chiao Tung University Manager, Business Department,Lian LiCo.,Ltd.	None	None	None	None	None
Senior Vice President of Finance & Administration Center	Republic of China	Paul Ying	Male	1999.05.03	156,969	0.04%	0	0	0	0	School of Management, New York Institute of Technology Vice President of Finance, Hsin Yu EnergyDevelopment Co.,Ltd.	Refer to page 107-109 for details on positions assumed in affiliated companies	None	None	None	None
Senior Vice President, Operation Management Center	Republic of China	Benjamin Huang	Male	1992.06.22	176,723	0.04%	0	0	0	0	Electrical Engineering Department, National Taiwan University Vice President, R&D Division, Test & Measurement BU of the Company	None	None	None	None	None
Senior Vice President of Manufacturing Center	Republic of China	Steven Liu	Male	1991.08.22	118,012	0.03%	0	0	0	0	Department of Information & Communications, Chinese Culture University Divisional Head, Property and Product Management Division of the Company	None	None	None	None	None
Vice President, Sales Division 1, Integrated System Solution BU	Republic of China	Herbert Tsai	Male	2005.07.01	1,974	0	0	0	0	0	Machinery and Automation Engineering, Nanya Institute of Technology Vice President, Dasike Technology Corporation	None	None	None	None	None
Vice President, President’s Office	Republic of China	C.C.Fan	Male	2010.08.01	163,235	0.04%	0	0	0	0	Department and Institute of Industrial Engineering and Management, Minghsin University of Science and Technology Vice President, R&D Department, Wei KuangAutomationCo.,Ltd.	None	None	None	None	None
Vice President, Product Planning Division, Test & Measurement BU	Republic of China	Bobby Tseng	Male	2001.01.01	10,000	0	0	0	0	0	Electrical Engineering, Waseda University Division Head, Product Planning Division, Measurement Instrument BU of the Company	None	None	None	None	None

• 11 -

Vice President, Greater China Area Sales Division, Test & Measurement BU	Republic of China	Vincent Chen	Male	2001.01.01	87,860	0.02%	0	0	0	0	Department of Electrical Engineering, Lunghwa University of Science and Technology Division Head, Greater China Area Sales Division, Test & Measurement BU	Refer to page107-109 for details on positions assumed in affiliated companies	None	None	None	None
Vice President, Technical Service Division, Test & MeasurementBU	Republic of China	Tony Yang	Male	2003.07.01	96,154	0.02%	0	0	0	0	Department of Electrical Engineering, National Taitung Junior College Manager, Engineering Division, Tiger PowerCo.,Ltd.	None	None	None	None	None
Vice President, R&D Division, Test & Measurement BU	Republic of China	Vincent Wu	Male	2003.07.16	95,665	0.02%	903	0	0	0	Electrical and Control Engineering Department, National Chiao Tung University Division Head, R&D Division, Test & Measurement BU of the Company	None	None	None	None	None
Vice President, R&D Division 1, Integrated System Solution BU	Republic of China	Lance Ouyang	Male	2009.07.01	48,500	0.01%	0	0	0	0	Mechanical Engineering Department, National Chiao Tung University Vice President, Global Target Corporation	None	None	None	None	None
Vice President, Sales Division 2, Integrated System Solution BU	Republic of China	Jeff Lee	Male	2007.01.01	86,500	0.02%	0	0	0	0	Department of Electrical Engineering, Hsinpu Institute of Technology Divisional Manager, Product Planning Division, Integrated System BU of the Company	None	None	None	None	None
Vice President, Product Planning Division, Test & Measurement BU	Republic of China	Kenny Wang	Male	1993.04.23	459,928	0.11%	0	0	0	0	Department of Electrical Engineering, Hsinpu Institute of Technology Division Head, Product Planning Division, Measurement Instrument BU of the Company	None	None	None	None	None
Vice President, Turnkey Solution Sales & Marketing Division, Test & Measurement BU	Republic of China	Cindy Tai	Female	2009.11.01	11,936	0	0	0	0	0	Department of Chemical Engineering, Tunghai University Manager, Project Planning Division, Test & Measurement BU ofthe Company	None	None	None	None	None
Vice President, Product Planning Division, Test & Measurement BU	Republic of China	Galen Chou	Male	1996.07.01	9,000	0	0	0	0	0	Electrical and Control Engineering Department, National Chiao Tung University Division Head, Product Planning Division, Measurement Instrument BU of the Company	None	None	None	None	None
Vice President, Marketing Division, Intelligent Manufacturing System BU	Republic of China	Arno Wu	Male	2007.04.01	0	0	0	0	0	0	Department of Business Management, Tamkang University Assistant Vice President, Sajet Technology	Refer to page107-109 for details on positions assumed in affiliated companies	None	None	None	None
Vice President, Product Planning Division, Optical Inspection Solution BU	Republic of China	Alex Zheng	Male	2020.06.15	0	0	0	0	0	0	Institute of Electronic Engineering, University of Warwick Institute of Biomechanical Engineering, National Taiwan University Vice President of Asia Pacific Region and Vice President of Taiwan Branch, Fortemedia,Inc.	None	None	None	None	None
Vice President, Product Planning Office, Semiconductor TestEquipmentBU	Republic of China	Eugene Lin	Male	2018.12.17	0	0	0	0	0	0	Business Management Institute, National Chengchi University Manager, Keysight Technologies Inc.	None	None	None	None	None
Corporate governance officer	Republic of China	Amy Huang (Note 1)	Female	1992.07.16	48,311	0.01%	0	0	0	0	Department of Accounting, Tunghai University Division Head, Finance Division of the Company	Refer to page107-109 for details on positions assumed in affiliated companies	None	None	None	None

Note 1: The Board of Directors approved the designation of Division Head Amy Huang of the Finance Division as the corporate governance officer of the Company on April 28, 2021. Note 2: If the Chairperson of the Board and the president or their equivalent (chief managerial officer) are the same person, each other’s spouse, or a relative of the first degree of kinship, the reason, reasonableness, necessity, and response measures (e.g. increase the number of independent directors and ensure that more than half of the directors do not concurrently serve as employees or managerial officers) shall be stated: (1) The Chairperson of the Company holds the concurrent position as the president to enhance the overall operating efficiency and decision execution of the Group. In order to reinforce the independence of the Board, the Company has set up three independent directors, representing 3/7 of the total number of directors of the Company. The Chairman also maintains adequate communication with each director on the Company’s operating status and performance in order to implement corporate governance. (2) In order to enhance the functions of the Board of Directors and strengthen its supervisory function, the Company has the following measures in place: 1. A majority of the Board members are not also managerial officers or employees. 2. The three independent directors of the Company have extensive working experience in finance, investment, HR management and electronic technology, respectively, and can carry out their supervisory functions effectively. 3. Members of the Audit Committee and the Remuneration Committee of the Company consist of independent directors, and all committees can thoroughly discuss and make recommendations for the Board’s decision to implement corporate governance.

• 12 -

III. Total remuneration paid to directors, CEO, and vice presidents in the most recent year

(I) Remuneration for the directors (including independent directors)

Unit: In thousands of NT$

Position title	Name (Note 1)	Director’s remuneration	Director’s remuneration	Director’s remuneration	Director’s remuneration	Director’s remuneration	Director’s remuneration	Director’s remuneration	Director’s remuneration	Proportion of NIAT after summing the 4 items of A, B, C, and D (Note 4)	Proportion of NIAT after summing the 4 items of A, B, C, and D (Note 4)	Remuneration paid to concurrent employee	Remuneration paid to concurrent employee	Remuneration paid to concurrent employee	Remuneration paid to concurrent employee	Remuneration paid to concurrent employee	Remuneration paid to concurrent employee	Remuneration paid to concurrent employee	Remuneration paid to concurrent employee	Proportion of NIAT after summing the 7 items A, B, C, D, E, F, and G (Note 4)	Proportion of NIAT after summing the 7 items A, B, C, D, E, F, and G (Note 4)	Compensation paid to the president and vice presidents from an invested company other than the Company’s subsidiaries or parent company (Note 3) (Note 7)
		Base remuneration (A)		Severance and pension (B)		Remuneration for directors (C) (Note 2)		Business execution fees (D) (Note 3)				Salary, bonus, allowance (E) (Note 5)		Severance and pension (F)		Remuneration for employee (G) (Note 6)
		The Company	All entities in the financial statemen ts	The Company	All entities in the financial statements	The Company	All entities in the financial statements	The Company	All entities in the financial statements	The Company	All entities in the financial statements	The Company	All entities in the financial statements	The Company	All entities in the financial statements	The Company		All entities in the financial statements		The Company	All entities in the financial statements
																Cash Amount	Stock Amount	Cash Amount	Stock Amount
Director	Leo Huang	0	0	0	0	6,000	6,780	360	360	6,360 0.15%	7,140 0.17%	10,085	10,085	181 (Note 8)	181 (Note 8)	28,360	0	30,910	0	44,986 1.08%	48, 316 1.16%	4,525
	I-Shih Tseng
	Tsun-I Wang
	Chung-Ju Chang
Independent director	Tai-Jen George Chen	0	0	0	0	3,600	3,600	270	270	3, 870 0.09%	3, 870 0.09%	0	0	0	0	0	0	0	0	3, 870 0.09%	3, 870 0.09%	0
	Jia-Ruey Duann
	Steven Wu
1.Description of the policies, systems, standards, and structure of the remuneration packages of independent directors and their correlations with the amount of remuneration paid, taking into account their responsibilities, risks, and time commitment: Bonus paid by the Company mainly comprises bonuses for directors. According to Article 34 of the Company's Articles of Incorporation, bonuses distributed to directors shall not be greater than 1.5% of the Company's net income before taxes and before deducting bonuses distributed to employees and directors in the current year. The independent directors' bonus distribution policy not only takes into account the operating performance of the entire Corporation, but also the individual director's contributions to the performance of the Company. The Remuneration Committee and the Board review the remuneration of the Directors, and the remuneration system is reviewed from time to time based on actual operating conditions, to strike a balance between the Company’s sustainable operation and risk control. 2.Except for information disclosed above, remuneration paid for services rendered by Directors of the Company to all consolidated entities (e.g. serving as a non-employee consultant in the parent company/all entities in the financial statements/investees) in the most recent fiscal year: NT$ 120,000.

recent fiscal year: NT$ 120,000.	recent fiscal year: NT$ 120,000.	recent fiscal year: NT$ 120,000.	recent fiscal year: NT$ 120,000.	recent fiscal year: NT$ 120,000.
Remuneration range for each director in the Company	Name of director
	Sum of the first 4 items(A+B+C+D)		Sum of the first 7 items(A+B+C+D+E+F+G)
	The Company	Parent companyand all investees(Note 7)	The Company	Parent companyand all investees(Note 7)
Less than NT$1,000,000
NT$1,000,000 (inclusive) to 2,000,000 (not inclusive)	I-Shih Tseng, Tsun-I Wang, Chung-Ju Chang, Tai-Jen George Chen,Jia-RueyDuann,Steven Wu	I-Shih Tseng, Tsun-I Wang, Chung-Ju Chang, Tai-Jen George Chen,Jia-RueyDuann,Steven Wu	Chung-Ju Chang, Tai-Jen George Chen, Jia-Ruey Duann,Steven Wu	Chung-Ju Chang, Tai-Jen George Chen, Jia-Ruey Duann,Steven Wu
NT$2,000,000(inclusive)to 3,500,000(not inclusive)	Leo Huang	Leo Huang
NT$3,500,000(inclusive)to 5,000,000(not inclusive)
NT$5,000,000(inclusive)to NT$10,000,000(not inclusive)
NT$10,000,000(inclusive)to 15,000,000(not inclusive)			I-Shih Tseng,Tsun-I Wang	I-Shih Tseng,Tsun-I Wang
NT$15,000,000(inclusive)to NT$30,000,000(not inclusive)			Leo Huang	Leo Huang
NT$30,000,000(inclusive)to NT$50,000,000(not inclusive)
NT$50,000,000(inclusive)to NT$100,000,000(not inclusive)
NT$100,000,000 and above
Total	7people	7people	7people	7people

Note 8: Refers to the amount of retirement pension contributed.

• 13 -

(II) Remuneration for CEO, and vice presidents

Unit: In thousands of NT$

Position title	Name	Salary (A)	Salary (A)	Severance and pension (B)	Severance and pension (B)	Bonuses and allowances (C)(Note 1)	Bonuses and allowances (C)(Note 1)	Remuneration for employees (D) (Note 2)	Remuneration for employees (D) (Note 2)	Remuneration for employees (D) (Note 2)	Remuneration for employees (D) (Note 2)	Proportion of NIAT after summing the 4 items of A, B, C, and D (%)	Proportion of NIAT after summing the 4 items of A, B, C, and D (%)	Compensation paid to the president and vice presidents from an invested company other than the Company’s subsidiaries or parent company (Note 3)
		The Company	All entities in the financial statements	The Company	All entities in the financial statements	The Company	All entities in the financial statements	The Company		All entities in the financial statements		The Company	All entities in the financial statements
								Cash amount	Stock amount	Cash amount	Stock amount
CEO	Leo Huang	54,395	55,222	2,765 (Note 4)	2,765 (Note 4)	12,581	14,694	87,160	0	89,710	0	156,901 3.75%	$162, 391 3.89%	None
President, Test & Measurement BU	David Yang
President, Integrated System Solution BU	I-Shih Tseng
President, Intelligent Manufacturing System BU	Joe Lin
President, Semiconductor Test Equipment BU	George Chang
Senior Vice President of Finance & Administration Center	Paul Ying
Senior Vice President, Operation Management Center	Benjamin Huang
Senior Vice President of Manufacturing Center	Steven Liu
Vice President, Sales Division 1, Integrated System Solution BU	Herbert Tsai
Vice President, President’s Office	C.C.Fan
Vice President, Product Planning Division, Test & Measurement BU	Bobby Tseng
Vice President, Greater China Area Sales Division, Test & Measurement BU	Vincent Chen
Vice President, Technical Service Division, Test & Measurement BU	Tony Yang
Vice President, R&D Division, Test & Measurement BU	Vincent Wu
Vice President, R&D Division 1, Integrated System Solution BU	Lance Ouyang
Vice President, Sales Division 2, Integrated System Solution BU	Jeff Lee
Vice President, Product Planning Division, Test & Measurement BU	Kenny Wang
Vice President, Turnkey Solution Sales & Marketing Division, Test & Measurement BU	Cindy Tai
Vice President, Product Planning Division, Test & Measurement BU	Galen Chou
Vice President, Marketing Division, Intelligent Manufacturing System BU	Arno Wu
Vice President, Product Planning Division, Optical Inspection Solution BU	Alex Zheng
Vice President, Product Planning Office, Semiconductor Test Equipment BU	Eugene Lin

• 14 -

Table of remuneration ranges

	Table of remuneration ranges	Table of remuneration ranges
Remuneration range for each Presidents and Vice Presidents in the Company	Name of the Presidents and Vice Presidents
	The Company	All entities in the financial statements
Less than NT$ 1,000,000
NT$1,000,000 (inclusive) to NT$2,000,000 (not inclusive)
NT$2,000,000 (inclusive) to NT$3,500,000 (not inclusive)	C.C.Fan	C.C.Fan
NT$3,500,000 (inclusive) to NT$5,000,000 (not inclusive)	Herbert Tsai, Bobby Tseng, Vincent Chen, Lance Ouyang, Vincent Wu, Jeff Lee, Kenny Wang, Cindy Tai, Galen Chou, Arno Wu, Alex Cheng, Eugene Lin, Tony Yang	Herbert Tsai, Bobby Tseng, Vincent Chen, Lance Ouyang, Vincent Wu, Jeff Lee, Kenny Wang, Cindy Tai, Galen Chou, Arno Wu, Alex Cheng, Eugene Lin, Tony Yang
NT$5,000,000 (inclusive) to NT$10,000,000 (not inclusive)	George Chang, Benjamin Huang, Steven Liu, Paul Ying, Joe Lin	George Chang, Benjamin Huang, Steven Liu, Paul Ying, Joe Lin
NT$10,000,000 (inclusive) to NT$15,000,000 (not inclusive)	David Yang, I-Shih Tseng	David Yang, I-Shih Tseng
NT$15,000,000 (inclusive) to NT$30,000,000 (not inclusive)	Leo Huang	Leo Huang
NT$30,000,000 (inclusive) to NT$50,000,000 (not inclusive)
NT$50,000,000 (inclusive) to NT$100,000,000 (not inclusive	)
NT$100,000,000 and above
Total	22 people	22 people

• Note 1: Includes the amount of various bonuses, rewards, transport fees, special expenses, various allowances, accommodation, provision of physical items such as vehicles, and other types of remuneration for the president and vice presidents in the most recent year. Salary expenses recognized under IFRS 2 - Share-based Payment, such as employee stock option certificates, new employee restricted stocks, and participation in subscription of stocks in cash capital increase, shall also be included within the remuneration.

• Note 2: The amount of employee compensation approved by the Board of Directors for the distribution of the president and Vice President in 2021 is based on the proportion of the actual distribution amount last year to calculate the proposed distribution amount for this year.

• Note 3: a. If the Company's president, or vice presidents receive remuneration from investments in other companies that are not subsidiaries of the Company or the parent companies, the said remuneration shall be included in the remuneration range table. The name of the column shall also be changed to “All investments in the parent companies and other companies”.

• b. Remuneration in this case refers to remuneration, bonuses (including employee, director, or supervisor bonuses), and allowances received by the president and vice presidents of the Company as the directors, supervisors, or managerial officers of invested companies other than subsidiaries or parent company.

• Note 4: Amount of retirement pension contributed.

• 15 -

• (III) Comparision and analysis of the total remuneration paid to the directors, president, and vice presidents of the Company in the two most recent years by all companies listed in the Company's parent company-only and consolidated financial statements as a percentage of NIAT listed in the parent company-only financial statements, and description of the policies, standards, and packages for payment of remuneration, the procedures for determining remuneration, and its connection to business performance and future risk exposure.

• Analysis of total remuneration paid to the Company’s directors, president, and vice presidents in the 2 most recent years as a percentage of NIAT:

Total compensation paid to directors, president, and vice president as a percentage of NIAT in 2021 (Note)	Total compensation paid to directors, president, and vice president as a percentage of NIAT in 2021 (Note)	Total compensation paid to directors, president, and vice president as a percentage of NIAT in 2020	Total compensation paid to directors, president, and vice president as a percentage of NIAT in 2020
The Company	All entities in the consolidated financial statements	The Company	All entities in the consolidated financial statements
3.99%	4.15%	6.70%	6.84%

Note: The amount of directors and employee compensation allocated for 2021 has been approved by the Board of Directors on February 23, 2022.

1. Policies, standards, and packages for payment of remuneration, the procedures for determining remuneration, and its linkage to business performance and future risk exposure.

2. (1) Directors:

3. Bonus paid by the Company mainly comprises bonuses for directors. According to Article 34 of the Company's Articles of Incorporation, the bonus distributed to directors shall not be greater than 1.5% of the Company's net income before taxes before deducting bonus distributed to employees and directors in the current year. The remuneration policy of the directors is to provide reasonable remuneration, taking into account the Company’s overall operating performance, future operating risks and development trends in the industry, and individual contribution to the Company’s performance. The Remuneration Committee and the Board have reviewed the director remuneration, and review occassionaly the remuneration system’s alignment with in line with real operating conditions and laws and regulations, so as to strike a balance between risk control and sustainable management of the Company. The fixed amount of directors' remuneration for 2021 and 2020 was $9.6 million, which accounted for 0.18% and 0.30% of the pre-tax net income for each year, respectively. The Company also pays directors' attendance fees at each Board meeting, which amounted to $630 thousand and $720 thousand for 2021 and 2020, respectively.

4. (2) Managerial officer:

5. The company has established the “Regulations Governing compensation for Senior Executives,” which stipulates that when a managerial officer is appointed, he/she shall be paid a fixed monthly salary based on the pay standards for similar positions in the industry. Any proposal to alter employee bonus shall be made according to the Company's operational performance for the current year and individual performance appraisal. Such proposal shall first be submitted to the Remuneration Committee for review before it is delivered to the Board of Directors for resolution.

6. (3) Employees:

7. The Company's compensation policy takes into account the salary levels of benchmark companies in the market, and provides differentiated and competitive salaries to employees based on the achievement of performance indicators to reflect employee performance and to measure salary and bonus levels. The salary composition includes salary and allowances, bonuses and employee compensation, welfare, etc.; the welfare system is designed on the premise that it is better than laws and regulations at talent attraction, motivation, and retention.

8. 16 -

9. (4) The Company shall generate a budget for the following year at the end of the current year. The following shall be referenced, including the current state of the economy and market environment and forecasts of overall business performance and risk exposure in the following year, to make suitable adjustments to compensation paid to managerial officers.

Names of managerial officers who receive employee bonus, and distribution of employee bonus

		March 31,2022(Unit: In thousands of NT$)	March 31,2022(Unit: In thousands of NT$)	March 31,2022(Unit: In thousands of NT$)	March 31,2022(Unit: In thousands of NT$)	March 31,2022(Unit: In thousands of NT$)
	Position title	Name	Stock amount	Cash amount (Note)	Total	Total amount of bonus as a percentage of NIAT
Managerial Officer	CEO	Leo Huang	0	87,160	87,160	2.09%
	President,Test &MeasurementBU	DavidYang
	President,Integrated System Solution BU	I-Shih Tseng
	President, Intelligent Manufacturing System BU	Joe Lin
	President, Semiconductor Test Equipment BU	George Chang
	Senior Vice President of Finance & Administration Center	Paul Ying
	Senior Vice President, Operation Management Center	Benjamin Huang
	Senior Vice President of Manufacturing Center	Steven Liu
	Vice President, Sales Division 1, Integrated SystemSolution BU	Herbert Tsai
	Vice President, President’s Office	C.C.Fan
	Vice President, Product Planning Division, Test & Measurement BU	Bobby Tseng
	Vice President, Greater China Area Sales Division, Test & Measurement BU	Vincent Chen
	Vice President, Technical Service Division, Test & Measurement BU	Tony Yang
	Vice President, R&D Division, Test & Measurement BU	Vincent Wu
	Vice President, R&D Division 1, Integrated System Solution BU	Lance Ouyang
	Vice President, Sales Division 2, Integrated System Solution BU	Jeff Lee
	Vice President, Product Planning Division, Test & Measurement BU	Kenny Wang
	Vice President, Turnkey Solution Sales & Marketing Division, Test & Measurement BU	Cindy Tai
	Vice President, Product Planning Division,Test &MeasurementBU	Galen Chou
	Vice President, Marketing Division, IntelligentManufacturing System BU	Arno Wu
	Vice President, Product Planning Division, Optical InspectionSolution BU	Alex Zheng
	Vice President, Product Planning Office, Semiconductor TestEquipmentBU	Eugene Lin
	Corporategovernance officer	AmyHuang

Note: Allocation of profit-sharing employee bonus approved by the Board of Directors in 2021 for managerial officers is based on the actual allocation sum ratio of the previous year.

• 17 -

IV. Operation of corporate governance

(I) Operation of Board of Directors

A total of 6 Board of Directors’ meetings were held in 2021 with the following attendance records:

records:
Position title	Name	Number of attendances inperson	Number of attendances by proxy	Percentage of attendance in person(%)	Repcrmark
Chairperson	Leo Huang	6	-	100%
Director	I-Shih Tseng	6	-	100%
Director	Chung-Ju Chang	6	-	100%
Director	Tsun-I Wang	6	-	100%
Independent director	Tai-JenGeorge Chen	6	-	100%
Independent director	Jia-Ruey Duann	6	-	100%
Independent director	StevenWu	6	-	100%
Other matters to be recorded: I. Where one of the following circumstances apply for the operations of the Board of Director meetings, the date, session, topics discussed, opinions of every independent director, and the Company’s handling of the opinions of the independent directors shall be explained: (I) Items listed in Article 14-3of theSecurities and Exchange Act: Board of Directors Date Session Proposal All independent directors' opinions The Company's actions in response to independent directors’opinions 2021.02.25 1st meeting in 2021 (1)Annual remuneration for directors, and attendance fees for directors and supervisors who attended the Board of Directors' meetings (2)2021 compensation for members of the Audit Committee, and attendance fees for members who attended Audit Committee meetings (3)Issuance of the Company’s 2020 statement of the internal control system. (4)Capital loansforChroma JapanCorp. No objection Proposal approved as presented 2021.04.28 2nd meeting in 2021 (1)Chroma ATE Inc. (USA) endorsement and guarantee (2)Endorsement and guarantee for Chroma ATE Europe B.V. (3)Replacement of attesting CPAs and evaluation of independence (4)Capital increase of Touch Cloud Inc. No objection Proposal approved as presented 2021.07.29 4th meeting in 2021 (1)Proposal for 2020 bonus distribution to the Company’s managerial officers. (2)Capital loans to Chroma Systems Solutions, Inc. (3)Endorsement and guarantee for MAS Automation Corp. (4)2021 CPA professional fees. (5)Amendments to the Company’s “accounting system” (6)Cash capital increase of TFBS Bioscience,Inc. No objection Proposal approved as presented

• 18 -

	2021.10.28 5th Endorsement and guarantee for MAS No Proposal approved
	meeting Automation Corp. objection as presented
	in 2021
	2021.12.23 6th (1) Amendments to the Company’s No Proposal approved
	meeting “Internal Control System” and objection as presented
	in 2021 “Enforcement Rules for Internal Audit”
	(2) Capital loans to Chroma Systems
	Solutions, Inc.
	(3) Endorsements and guarantees for
	subsidiaries in Mainland China.
	(4) Endorsement and guarantee for Chroma
	Japan Corp.
	(5) Donated to establish the Chroma
	Cultural Educational and Foundation.
	(II) In addition to the aforementioned matters, any other resolutions from the Board of Directors where an
	independent director expressed a dissenting or qualified opinion that has been recorded or stated by
	writing: None.
II.	During the execution process where the Director abstains from being a stakeholder, the name of the director,
	the content of the proposal, the reason for abstinence, and the results of the voting should be stated: None.
III.	TWSE/TPEx listed companies shall disclose information such as the evaluation cycle and period, scope,
	method, and items of the Board’s self (or peer) evaluation, and fill out the implementation status of
	evaluation of the Board in Table 2(2).
	The Company’s “Rules for Evaluation of the Performance of the Board” stipulates that the Board shall
	perform performance evaluation of itself, its members, the Remuneration Committee and the Audit
	Committee at least once a year. The performance evaluations of the Board of Directors shall be completed
	before the end of the first quarter in the following year.
	Internal questionnaires were used by the meeting staff and four areas were covered including overall
	operation of the Board, assessment of the Directors’ participation, operation of the Remuneration
	Committee, and operation of the Audit Committee. The results of the evaluations of the Board of Directors
	and functional committees of the Company for 2021 were submitted to the Board of Directors on February
	23, 2022.
	The results of the performance self-assessment regarding the Board of Directors and its members were
	between 4.90 and5.00 (out of 5) on average. The score for "communication and exchange between
	directors and certified public accountants" is relatively low. Functional committees include the Audit
	Committee and the Remuneration Committee, and their overall performance assessment results averaged
	between 4.92 and 5.00 (out of 5). The score for "full communication and exchange between the Audit
	Committee and certified public accountants" is relatively low. On the whole, the Board of Directors is
	operating well and will continue to strengthen based on the results of this Board of Directors' assessment
	to enhance the effectiveness of the Company’s corporate governance.
IV.	Goals for enhancing the functions of the Board of Directors (such as establishing an Audit Committee or
	increasing information transparency) for the current year and most recent year as well as the assessment of
	the actions implemented:
	The Company has set up the Audit Committee, and has formulated the “Audit Committee Charter”. The
	operation of the Audit Committee complies with the relevant laws and regulations. The Company's website
	also discloses important resolutions of the Board of Directors in the most recent year to safeguard the rights
	and interests of the shareholders.
	In addition, the Company has established and operated the Remuneration Committee in accordance with the
	law. The Committee assesses the salary and compensation policy and system for directors and managerial
	officers, and provides recommendations to the Board of Directors for reference during decision-making.
	For the operation of corporate governance, refer to “Operation of corporate governance - (V) Operation of
	RemunerationCommittee”.

• 19 -

(II) Evaluation of Board of Directors

Frequency	Period	Scope	Method		Content
Once a year	2021.01.01~ 2021.12.31	(1) The entire Board of Directors (2) Individual Board directors (3) Audit Committee (4) Remuneration Committee	Self- evaluation		Evaluation Items for the Board of Directors (1) Participation in the Company's operations (2) quality of Board decisions (3) composition and structure of the Board of Directors (4) selection and continuing education of directors (5) internal control. Evaluation items for individual Board directors (1) Alignment of the Company's objectives and tasks (2) directors' awareness of their duties and responsibilities (3) Participation in the Company's operations (4) internal relationship management and communication (5) directors' professionalism and continuing education (6) internal control. Performance evaluation of functional committees (1) Participation in company operations (2) awareness of functional committee responsibilities (3) quality of functional committee decisions (4) composition and selection of functional committee members (5) internalcontrol

(III) Operation Overview of the Audit Committee:

A total of 5 meetings were convened by the Audit Committee in 2021, with the attendance of independent directors listed as follows:

Position title	Name	Number of attendances in person	Number of attendances by proxy	Percentage of attendance in person (%)	Remark
Convener	Steven Wu	5	-	100%
Committee Member	Jia-Ruey Duann	5	-	100%
Committee Member	Tai-Jen George Chen	5	-	100%
Other matters to be recorded: I. If the operation of the Audit Committee meets any of the following situations, the date, period, proposal content, the content of the objections, reservations or major recommendations of the independent directors, resolution of the Audit Committee and the Company’s handling of the Audit Committee’s opinions should be described: (I) Items listed in Article 14-5 of the Securities and Exchange Act: Audit Committee date Period Proposal The content of the objections, reservations or major recommendations Resolution of the Audit Committee The Company's actions in response to the opinions of the Audit

• 20 -

			of the independent directors		Committee
2021.02.25	5th meeting of the second audit committee	(1) The Company’s 2020 business report and financial statements (2) Issuance of the Company’s 2020 statement of the internal control system. (3) Capital loans for Chroma Japan Corp.	None	Approved by the committee members	Proposal approved as presented
2021.04.28	6th meeting of the second audit committee	(1) The Company’s Q1 2021 financial statements. (2) Chroma ATE Inc. (USA) endorsement and guarantee (3) Endorsement and guarantee for Chroma ATE Europe B.V. (4) Replacement of attesting CPAs and evaluation of independence (5) Capital increase of Touch Cloud Inc..	None	Approved by the committee members	Proposal approved as presented
2021.07.29	7th meeting of the second audit committee	(1) The Company’s Q2 2021 financial statements. (2) Capital loans to Chroma Systems Solutions, Inc. (3) Endorsement and guarantee for MAS Automation Corp. (4) 2021 CPA professional fees. (5) Amendments to the Company’s “accounting system” (6) Cash capital increase of TFBS Bioscience, Inc.	None	Approved by the committee members	Proposal approved as presented
2021.10.28	8th meeting of the second audit committee	(1) The Company’s Q3 2021 financial statements. (2) Endorsement and guarantee for MAS Automation Corp.	None	Approved by the committee members	Proposal approved as presented
2021.12.23	9th meeting of the second audit committee	(1) Amendments to the Company’s “Internal Control System” and “Enforcement Rules for Internal Audit” (2) Capital loans to Chroma Systems Solutions, Inc. (3) Endorsements and guarantees for subsidiaries in Mainland China. (4) Endorsement and guarantee for Chroma Japan Corp. (5) Donated to establish the Chroma Cultural and Educational Foundation.	None	Approved by the committee members	Proposal approved as presented

• 21 -

• aforesaid report to the independent directors and they may request clarification from the Internal Auditing Officer upon any inquiry.

• (2) The Head of Internal Audit shall attend the meetings of the Audit Committee at least once a quarter to give an internal audit business report, which shall include the description of audit projects, significant items for improvement of internal audit and improvement policies, etc., so the independent directors may have immediate access for consultation and communication.

Date of meeting	Content of the communication	Results of the communication
2021.02.25	(1) Reporting on internal audit activities. (2) Discussion on issuance of the Company’s 2020 statement oftheinternalcontrolsystem.	Approved by independent directors without objections
2021.04.28	Briefing of Internal audit activities.	Approved by independent directors without objections
2021.07.29	Briefing of Internal audit activities.	Approved by independent directors without objections
2021.10.28	Briefing of Internal audit activities.	Approved by independent directors without objections
2021.12.23	(1) Reporting on internal audit activities. (2) Discussion of the 2022 audit plan. (3) Amendments to the Company’s “Internal Control System” and“EnforcementRulesfor Internal Audit”	Approved by independent directors without objections
2022.02.23	(1) Reporting on internal audit activities. (2) Discussion on issuance of the Company’s 2021 statement of the internal control system.	Approved by independent directors without objections

• 22 -

• (IV) The state of the Company's implementation of corporate governance, any departure of such implementation from the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies, and the reason for any such departure.

Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed corporations and causes thereof
	Yes	No	Summary and Explanation
I. Has the Company formulated and disclosed its corporate governance best practice principles in accordance with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies?	ˇ		The Company has stipulated the Corporate Governance Best Practice Principles. Please visit the MOPS or the official website of the Company to peruse the details.	No difference
II. Equity structure and shareholders’ rights of the Company (I) Has the Company established an internal operating procedure for handling matters related to shareholders' recommendations, doubts, disputes and lawsuits, and implemented them accordingly? (II) Does the Company maintain a list of major shareholders who have actual control over the Company and persons who have ultimate control over the major shareholders? (III) Did the Company establish and enforce risk control and firewall systems with its related corporation? (IV) Has the Company formulated internal regulations that prohibit insiders of the Company from trading securities using undisclosed information in the market?	ˇ ˇ ˇ ˇ		(I) The Company has established a system of spokespersons and deputy spokespersons for handling shareholders' proposals, inquiries, and other relevant matters. (II) The Company has delegated a dedicated person to manage the relevant information in order to effectively assess shareholding by the Company’s directors, managerial officers, and major shareholders holding more than 10% of the Company's shares, and disclosed this information in accordance with the relevant regulations. (III)The Company has established regulations for the monitoring of subsidiaries and delegated personnel for supervising the financial operations of these subsidiaries. (IV)There is a regulation on "Prevention of Insider Trading", which prohibits insiders, such as directors or employees of the Company, from using undisclosed information in the market to trade stocks. This regulation can be found on the Company's website. In addition, to protect shareholders' rights and interests and to implement equal treatment of shareholders,	No difference

• 23 -

Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed corporations and causes thereof
	Yes	No	Summary and Explanation
			the Company prohibits insiders from trading marketable securities using unpublished information in the market, including stock trading control measures from the date the Company's insiders are informed of the Company's financial reports or related results, including directors and managerial officers from trading their shares during the closed period of 30 days prior to the announcement of annual financial reports and 15 days prior to the announcement of quarterlyfinancial reports.
III. Composition and responsibilities of Board of Directors: (I) Has the Board of Directors formulated diversity policies, specific management objectives and implemented them?	ˇ		(I) The Company stipulated Best Practice Principles for Corporate Governance that the composition of the Board of Directors must consider the diversity as well as principles of diversity that including basic criteria, professional knowledge, and skills which correspond to the operations, business, and development required by the Company. In order for the Board of Directors to make effective decisions, the Board of Directors should be composed of a variety of professionals, including those specializing in the management of the electronic information industry, and those specializing in finance and finance. The Company has 7 directors and 3 independent directors, each of whom has different professional backgrounds and whose terms of office have not exceeded 3 terms. The composition of the Board of Directors is diversified, and the number of directors who are also managerial officers of the	No difference

• 24 -

Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed corporations and causes thereof
	Yes	No	Summary and Explanation
(II) Has the Company voluntarily established other functional committees, other than the remuneration committee and audit committee that are established in accordance with the law? (III) Did the Company stipulate regulations for assessing the performance of the Board and the process of assessment, conduct performance appraisals on an annual basis regularly, and submit the results of the performance appraisal to the Board? Are the results used as a reference for the remuneration of individual Directors and the nomination for re-appointment? (IV) Does the Company regularly evaluate the independence of CPAs?	ˇ ˇ	ˇ	Company does not exceed one- third of the total number of directors. (II) The Company has established the Remuneration Committee and the Audit Committee in accordance with the law. (III)The Board of Directors of the Company has formulated the Regulations on the Evaluation of the Performance of the Board and its evaluation methods, which stipulate that the Board shall perform performance evaluation of the Board, its members, the Remuneration Committee and the Audit Committee at least once a year. The Company's Remuneration Committee shall regularly review the policy, system, standards, and structure for the performance appraisal, salary, and remuneration of directors and managerial officers, and shall submit its recommendations to the Board of Directors' for deliberation. The results of evaluation of the Board of Directors for 2021 were submitted to the Board on February 23, 2022. (IV)Except for obtaining the independent declaration from CPA, the Company regularly evaluates the independence of the appointed CPA every year, and submits the evaluation results to the Board of Directors. Evaluation results for the most recent year (detailed in Note 1) have been submitted to the Board of Directors on April 28,2021.

• 25 -

Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed corporations and causes thereof
	Yes	No	Summary and Explanation
IV. Does the TWSE/TPEx listed company have a suitable and appropriate number of corporate governance personnel and appoint a corporate governance officer to be in charge of corporate governance-related matters (including but not limited to supplying the information requested by the directors and supervisors for the execution of their duties, assisting the directors and supervisors in compliance with legal regulations, handling matters related to Board meetings and shareholders’ meetings and preparing minutes of Board meetings and shareholders’ meetings)?	ˇ		The Company's Finance Division has designated dedicated personnel to handle corporate governance matters, and the Head of Finance Division, Amy Huang, has been designated as the corporate governance officer in accordance with the law, and is the highest authority responsible for governance-related matters of the Company. The main duties are: (I) Administer the meetings of the Board of Directors and the shareholders' meetings in accordance with the law. (II) Prepare minutes of the Board of Directors' and shareholders' meetings. (III) Assist directors in their appointment and continuing education. (IV) Provide information necessary for directors to carry out their business. (V) Assist directors in complying with the law (VI) Other matters as set forth in the Articles of Incorporation or contract.	No difference
V. Has the Company established channels of communication with stakeholders (including but not limited to shareholders, employees, customers, and suppliers), dedicated a section of the Company's website for stakeholder affairs, and adequately responded to stakeholders' inquiries on material corporate social responsibility (CSR) issues?	ˇ		The Company has established a CSR area on its official website which provided contact information, emails, and other channels of communication to stakeholders so that they may raise topics that they are concerned with. These concerns will then be promptly addressed by the Company.	No difference
VI. Does the Company commission a professional shareholder services agency to handle shareholders' meetings and other relevant affairs?	ˇ		The Company has appointed Taishin Securities Co., Ltd. to handle affairs of the shareholders’ meeting.	No difference
VII. Information disclosure (I) Has the Company established a website to disclose information on financial operations and corporate governance?	ˇ		(I) The Company has set up a website with special pages on investor services and regular updates on financial operations and corporate governance. Website: (www.chromaate.com)	No difference

• 26 -

Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed corporations and causes thereof
	Yes	No	Summary and Explanation
(II) Has the Company adopted other means of information disclosure (such as establishing a website in English, appointing specific personnel to collect and disclose company information, implementing a spokesperson system, and disclosing the process of investor conferences on the Company’s website)? (III) Has the Company published and reported its annual financial report within two months after the end of a fiscal year, and published and reported its financial reports for the first, second, and third quarters as well as its operating status for each month before the specified deadline?	ˇ	ˇ	(II) The Company has established Chinese and English language websites as well as a special area for investor services. A professional has been charged with collecting information and providing regular updates for financial operations. The Company has delegated a spokesperson and deputy spokesperson. Investor conferences are held on a regular basis, and relevant information has been disclosed using the Company's official website. (III) The Company publishes and reports its annual financial reports and first, second, and third-quarter financial reports within the prescribed period, together with its operations.
VIII. Does the Company provide other important information that can help establish a better understanding of the state of corporate governance (including but not limited to employee rights, employee care, investor relations, supplier relations, stakeholders’ rights, continuing education among directors and supervisors, implementation of risk management policies and risk measurement standards, implementation of customer policies, and purchase of liability insurance for directors and supervisors of the Company)?	ˇ		1. Employees' equity: According to the Labor Standards Act and the Company's personnel regulations; the Company takes the employees' equity seriously and so has set up the employees' feedback mail box, communications channels and various specific areas for discussion to provide a comprehensive selection of channels for feedback. 2. Employee care: In addition to providing a good office environment, employees also enjoy a diverse selection of recreational facilities such as swimming pools and gyms. The Company also subsidizes club activities to provide employees with a variety of after-work leisure options. 3. Investor relations: The Company'swebsite has an	No difference

• 27 -

Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed corporations and causes thereof
	Yes	No	Summary and Explanation
			investors' service page, a spokesperson, and a deputy spokesperson, specifically responsible for public disclosure of Company matters. The Company will also organize road- shows regularly to disclose relevant information regarding the Company's operations, and update that information on the Company's website. 4. Supplier relations: The business strategy adopted by the Company upholds trust as the highest guiding principle and respects every commitment made with both suppliers and stakeholders. The Company aims at building positive and interactive relationships with suppliers and will not delay payments without proper cause. 5. Stakeholders’ rights: To provide public investors with information transparency and prompt notification, financial and business information posted on the Company’s website shall be regularly updated. 6. All directors of the Company have academic backgrounds and practical experience in business management applicable to the business scope of the Company. The following lists financial, business, and professional courses recently taken by the Company directors and managerial officers (refer to Note 2). 7. Implementation of risk management policy and risk evaluation standards: The Company has carefully stipulated various internal control regulations to manage and evaluate various risks. 8. Execution of customer policies: TheCompanyis involved in the

• 28 -

Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed corporations and causes thereof
	Yes	No	Summary and Explanation
			sales of instruments and equipment, and provides excellent product inquiry response as well as rapid maintenance and other post-sales services to ensure that the clients’ production lines operate smoothly while maintaining positive customer relationships. 9. The Company has purchase liability insurance for all the directors and important staff. This action was reported to the Board of Directors on December 23, 2021.
IX. Improvements made in the most recent year in response to the results of corporate governance evaluation conducted by the Corporate Governance Center of the Taiwan Stock Exchange Corporation, and prioritized matters and measures to be improved upon for matters that have not been improved. (This section need not be completed by corporations not listed for evaluations.) 1. Improvements made in the most recent year: (1) Revealing the assessment procedures for assessing the independence of CPA in the annual report. (2) Providing refresher course information to the directors, and increasing the number of directors' refresher hours. 2.Prioritized matters and measures yet to be improved: (1) Invitingdirectors to attend the shareholders meeting,and improvingthe attendance.

Note 1: Assessment of independence and qualification for the Company's CPA	Note 1: Assessment of independence and qualification for the Company's CPA
Evaluation Items	Y/N	Meets the required independence and competence
1. The CPA did not serve as directors and supervisors of the Company	Y	
2. The CPA isnot a shareholderofthe Company	Y	
3. The CPA does not work part-time in the Company or is engaged in regularwork,and ispaid	Y	
4. The CPA hasno significantfinancial interestinthe Company	Y	
5. TheCPA has no borrowingfrom or lendingto theCompany	Y	
6. The CPAs are not involved in the management function of the Company’s decisionsmaking	Y	
7. The CPA has not served in the Company in the first two years of practicing	Y	
8. Receipt ofa declarationof independence by the CPA	Y	
9. The CPA has not provided the Company’s audit certification service for 7 consecutiveyears	Y	
10.There are no interaction issues between CPA and management, governance units,and the internal audit supervisor.	Y	
11.The quality of audit and tax services meets the requirements in a timely and effectivemanner	Y	
12.The Company’s financial report has not been litigated or corrected by the competent authority	Y	

• 29 -

Note 2: Progress of FY2021 training for the Company’s directors up to the publication date of this annual report.

report.
Position title	Name	Training date		Organizer	Curriculum	Training hours	Total training hours for theyear
		From	To
Director	Leo Huang	2021/09/01	2021/09/01	Financial Supervisory Commission	The 13th Taipei Corporate Governance Forum	3	6
		2021/11/09	2021/11/09	Securities and Futures Institute	2021 Annual Seminar on Prevention of Insider Trading	3
Director	I-Shih Tseng	2021/09/01	2021/09/01	Financial Supervisory Commission	The 13th Taipei Corporate Governance Forum	6	6
Director	Tsun-I Wang	2021/09/01	2021/09/01	Financial Supervisory Commission	The 13th Taipei Corporate Governance Forum	6	6
Director	Chung-Ju Chang	2021/11/03	2021/11/03	Securities and Futures Institute	2021 Annual Seminar on Prevention of Insider Trading	3	6
		2021/11/12	2021/11/12	Securities and Futures Institute	Advanced Seminar on Directors and Supervisors (including Independent) and Practices of Corporate Governance Officers - The Key to Becoming a Sustainable Enterprise: ESG in Practice	3
Independent director	Jia-Ruey Duann	2021/09/01	2021/09/01	Financial Supervisory Commission	The 13th Taipei Corporate Governance Forum	3	6
		2021/11/05	2021/11/05	Securities and Futures Institute	2021 Annual Seminar on Prevention of Insider Trading	3
Independent director	Tai-Jen George Chen	2021/11/03	2021/11/03	Securities and Futures Institute	2021 Annual Seminar on Prevention of Insider Trading	3	6
		2021/11/17	2021/11/17	Securities and Futures Institute	Advanced Seminar on Directors and Supervisors (including Independent) and Practices of Corporate Governance Officers - IP Management from the Board of Directors' Perspective	3
Independent director	Steven Wu	2021/10/27	2021/10/27	Taiwan Academy of Banking andFinance	Corporate Governance and Corporate Sustainability Workshop (17th session)	3	6
		2021/12/15	2021/12/15	Securities and Futures Institute	Advanced Seminar on Directors and Supervisors (including Independent) and Practices of Corporate Governance Officers-	3

• 30 -

Human Resources and M&A Integration Issues in the Corporate Merger and Acquisition Process

Corporate governance training for the Company’s managerial officers in 2021 up to the publication date of this annual report:

Position title	Name	Training date	Training date	Organizer	Curriculum	Training hours
		From	To
Accounting Officer	Paul Ying	2021/12/16	2021/12/17	Accounting Research and Development Foundation	Continuing Training Course for Principal Accounting Officers of Issuers, Securities Firms, and SecuritiesExchanges	12
Corporate governance officer	Amy Huang	2021/09/01	2021/09/01	Financial Supervisory Commission	The 13th Taipei Corporate Governance Forum	6
		2021/11/09	2021/11/09	Accounting Research and Development Foundation	2021 Annual Seminar on Prevention of Insider Trading	3

• 31 -

(V) Composition, duties, and operation of the Remuneration Committee

1. Information on the members of the Remuneration Committee

Identity	Conditions Name	Professional qualifications and experiences	Status of Independence	Number of salary and remuneration committee memberships concurrently held in other public corporations
Independent director (convener)	Tai-Jen George Chen	Please refer to page 6-10 for detailed information on directors	Please refer to page 6-10 for detailed information on directors	2
Independent director	Jia-Ruey Duann	Please refer to page 6-10 for detailed information on directors	Please refer to page 6-10 for detailed information on directors	1
Independent director	Steven Wu	Please refer to page 6-10 for detailedinformationondirectors	Please refer to page 6-10 for detailedinformationondirectors	0

2. Operations of the Remuneration Committee

(1) The Company has a Remuneration Committee composed of 3 members.

(2) Duration of the current term of service: July 3, 2020, until June 9, 2023, a total of 2 Remuneration Committee meetings were held in 2021, members’ qualifications and attendance as follows:

Position title	Name	Number of attendances in person	Number of attendances by proxy	Percentage of attendance in person (%) (Note)	Remark
Convener	Tai-JenGeorge Chen	2	-	100%
Committee Member	Jia-Ruey Duann	2	-	100%
CommitteeMember	StevenWu	2	-	100%
Other matters to be recorded: I. Dates of the Remuneration Committee's meetings in the most recent fiscal year, sessions, the content of proposals, resolutions of the Committee, and the Company's actions in response to the opinions of theRemunerationCommittee Session Date Content of Motion and Follow-up Actions Resolution results The Company's actions in response to the opinions of the Remuneration Committee 1st meeting in 2021 2021.02.25 (1) Proposal of the annual rewards for directors, and attendance fees for directors who attended Audit Committee meetings (2) Proposal of 2021 compensation for members of the Audit Committee, and attendance fees for members who attended Audit Committee meetings Approved by all committee members Proposed by the Board of Directors and adopted with the approval of all attended Directors 2nd meeting in 2021 2021.07.29 (1) Proposal of 2020 bonus distribution to the Company’s managerial officers. (2) Amendments to the Regulations Governing the Evaluation of the Performance of the Board of Directors. Approved by all committee members Proposed by the Board of Directors and adopted with the approval of all attendedDirectors II. If the Board of Directors does not adopt or amend the recommendations made by the Remuneration Committee, the date and session of the Board of Directors' meeting, resolutions, voting results and handling of opinions from the Remuneration Committee by the Company shall be disclosed (if the remuneration approved by the Board of Directors is better than that recommended by the Remuneration Committee, the discrepancies and related reasons shall be stated): None. III. Where resolutions of the Remuneration Committee include dissenting or qualified opinion which is on record or stated in a written statement, the date, session, contents discussed, opinions from every member, and disposition of the members’opinions shall be described in detail: None.

II. If the Board of Directors does not adopt or amend the recommendations made by the Remuneration Committee, the date and session of the Board of Directors' meeting, resolutions, voting results and handling of opinions from the Remuneration Committee by the Company shall be disclosed (if the remuneration approved by the Board of Directors is better than that recommended by the Remuneration Committee, the discrepancies and related reasons shall be stated): None.

III.Where resolutions of the Remuneration Committee include dissenting or qualified opinion which is on record or stated in a written statement, the date, session, contents discussed, opinions from every member, and disposition of the members’ opinions shall be described in detail: None.

• 32 -

3. Information on the members of the Nomination Committee and its operation: None.

(VI) Implementation of sustainable development, Deviations from "Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies" and Reasons Thereof

Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies, and causes thereof
	Yes	No	Summary and Explanation
I. Has the Company established a governance structure to promote sustainable development, and set up a dedicated (part-time) unit to promote sustainable development, which is authorized by the Board of Directors to be handled by senior management, and the supervision situation of the Board of Directors?	ˇ		ESH unit shall concurrently implement	No difference
			CSR activities, integrate various CSR
			efforts and results from other
			departments, and provide summary
			reports on CSR activities to upper
			management on a regular basis. The
			Company reports regularly to the
			Board of Directors on the
			implementation of corporate social
			responsibility, with the most recent
			report dated October 28, 2021. The
			company reports on its actions and
			achievements in corporate governance,
			sustainable supply chain, sustainable
			environmental protection, construction
			of a safe and healthy workplace, and
			employee care and social participation,
			as well as on the establishment of
			communication channels for
			stakeholders and responses to their
			concerns on important issues.
II. Has the Company assessed the environmental, social, and corporate governance risks related to its operations based on the principle of materiality and established related risk management policies or strategies? (Note 2)	ˇ		The Company has formulated the “Corporate Governance Best Practice Principles” and “Sustainable Development Best Practice Principles”, which have been approved by the Board of Directors for management and all employees to follow and managing the Company's impact on the environment, societyand corporategovernance.	No difference
III. Environmental Issues (I) Has the Company referred to the nature of its industry to establish a suitable environmental management system (EMS)?	ˇ		(I) All environmental safety operations are regulated in accordance with laws and regulations. The Company regularly tracks and declares the amount of waste generated, sets targets for waste reduction, carries out ideas for resource recycling, and sets up various energy-saving programs to achieve thegoal of energy	No difference

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Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies, and causes thereof
	Yes	No	Summary and Explanation
(II) Is the Company committed to improving the usage efficiency of energies and utilizing renewable resources with reduced environmental impact? (III) Has the Company assessed the potential risks and opportunities arising from climate change at present and in the future and taken related countermeasures?	ˇ ˇ		conservation and environmental protection. The Company currently obtains ISO 14001 attestation. (II) The Company is committed to the development of green energy products, giving priority to environmental protection products and building its headquarters in accordance with green building regulations. The Company is committed to reducing the use of hazardous substances, and generating lead-free production processes. Suitable recycling processes are applied according to the waste characteristics. Waste sorting is implemented through policy announcement and promotion, lectures, labeling, posting and secondary sorting to reduce waste and increase resource recovery rate in fulfilling the Company’s environmental protection responsibility. (III) The Company has established a greenhouse gas inventory system for the 6th year, established an inventory mechanism for all possible sources of greenhouse gases in the organization, and regularly checked the greenhouse gas emission of Scope 1 and Scope 2 of the plant in the previous year on an annual basis, and it has been verified by a third- party external verification agency and obtained the ISO14064-1 certification. By fully understanding the Company’s GHG emissions and formulating short, medium, and long-term reduction plans based on individual emissions, the Company’s actions in

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Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies, and causes thereof
	Yes	No	Summary and Explanation
(IV) Has the Company calculated the greenhouse gas emissions, water consumption, and total weight of waste over the past two years and established policies with regard to energy conservation and carbon reduction, greenhouse gas reductions, water consumption, and waste management?	ˇ		environmental protection are demonstrated. In the future, the Company will continue to examine the greenhouse gases emitted by the Company and formulate related reduction measures to lessen the impact on the environment. (IV) The Company has introduced ISO 14001 and ISO 14064 systems and has passed external third- party inspection. The Company has implemented measures such as enhancing the efficiency of the air-conditioning cooling system, reducing energy consumption, hardware improvement, installing power-saving designs for air- conditioning containers, replacing air-conditioning temperature control system with refrigerant flow measurement system, strengthening power usage monitoring, water-saving packing device and gradually replacing all factory-wide public lighting equipment with LED lights to achieve energy saving and carbon reduction, reduce energy consumption, so as to reduce carbon emission intensity and fulfill the obligation of environmentalprotection.
IV. Social Issues (I) Does the Company formulate appropriate management policies and procedures according to relevant regulations and the International Bill of Human Rights?	ˇ		(I) The Company abides by the laws and regulations where it operates around the world, respects and supports recognized international norms and principles of human rights, including the “International Code of Human Rights”, “Universal Declaration of Human Rights” and the International Labor Organization’s “Declaration of Fundamental	No difference

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Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies, and causes thereof
	Yes	No	Summary and Explanation
(II) Has the Company established and offered proper employee benefits (including compensation, leave, and other benefits) and reflected the business performance or results in employee compensation appropriately? (III) Does the Company provide a healthy and safe working environment and organize training on health and safety for its employees on a regular basis? (IV) Has the Company established an effective career competence training plan for its employees?	ˇ ˇ ˇ		Principles and Rights at Work”, treats with dignity and respects all employees, contract and temporary personnel, interns, etc., and formulates the Company’s internal management policies and related procedures accordingly. (II) In addition to providing employees with various leaves according to the law, the Company also allows paid sick leave up to five days and one-day birthday leave, which is more than provided by to the law. Formulate a competitive salary plan that is superior to legal standards, and allocate employee rewards based on annual operating performance. The Company operating performance and employee personal performance are appropriately reflected in employee compensation policies to ensure the recruitment, retention, and incentives of human resources, achieving the sustainable operation goal. (III) In order to fulfill its corporate social responsibilities and ensure the safety of all colleagues, the Company regularly implements in- service employee education and training, new employee education and training, and fire drills. (IV) The Company regards talent cultivation and development as a competitive advantage, plans a complete education and training system and development training courses to help employees improve their professionalism, management capabilities, and self- growth. Formulate the "Education and Training Management Measures",and introduce

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Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies, and causes thereof
	Yes	No	Summary and Explanation
V. Has the Company followed relevant laws, regulations and international guidelines for issues such as customer health and safety, customer privacy, and marketing and labeling of its products and services and established related consumer or customer protection policies and grievance procedures? VI. Has the Company established the supplier management policies requesting suppliers to comply with laws and regulations related to environmentalprotection,	ˇ ˇ		education and training courses every year, put forward training plans according to the needs of various departments, and continue to optimize the professional functions of employees. (V) The Company focuses on leading manufacturers in the field of testing and provides customers with innovative and quality services to meet their needs. We provides customers with satisfactory product quality and complete sales services, and conducts regular customer satisfaction surveys every year, as we regard customer satisfaction evaluation and survey results as an important basis for improving customer relationship development. We turn customer feedback into motivation to improve our products and services in order to achieve our ultimate goal of exceeding customer expectations. The Company complies with regulations and international standards in the marketing and labeling of products and services. The Company regards maintaining confidential information for business with customers as its highest principle. In addition to the Code of Business Conduct for Employees, all confidential information of the Company shall be kept in custody professional units to ensure the safety of the property of customers. (VI) The Company has established supplier management rules to clearly regulate and require suppliers to comply with relevant laws and regulations,and

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Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies, and causes thereof
	Yes	No	Summary and Explanation
occupational safety and health or labor rights and monitored their compliance?			implement supplier evaluation and review operations for high-risk suppliers, and replace those who fail to meet the standards.
V. Does the Company refer to international reporting standards or guidelines to prepare sustainability or other reports that disclose non- financial information about the Company? Has the assurance or opinion from third-party certifying institutions been obtained for the aforementioned reports?	ˇ		The Company’s report refer to the requirements of the GRI Standards, which is validated and certified by BV as a third party.	No difference
VI. Where the Company has stipulated its own Best Practices on sustainable development according to the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies, please describe any differences between the prescribed best practices and actual activities taken by the Company: The corporation has stipulated “Sustainable Development Best Practice Principles”, which provide various specifications on environmental management, community services, human rights, stakeholders’ rights, and participation in community services. These Best Practices may be perused on the Company's website. For the status of sustainability operations of the corporation, please peruse the CSR reports compiled bytheCompany.
VII. Any important information useful for understanding the state of sustainable development operations: (I) The Company promotes sustainable development in a long-term manner. Every year, the Company reveals its sustainable development status and business philosophy through CSR reports, and reports the implementation of sustainable development to the public based on the concept and practice of transparency, openness, and corporate social sustainability. (1) Environmental sustainability Reducing the impact on the environment is a very important part of sustainable development. Our company is actively developing high-tech, low-pollution, low energy consumption products, such as the regenerative battery pack testing system launched in recent years, which can save a lot of electrical energy consumed in the discharge process and recycle the electrical energy generated by the battery pack discharge to the power grid for reuse, solving the traditional equipment discharge energy waste and meeting the needs of environmental protection. (2) Talent cultivation The Company has been promoting and participating in various social welfare activities and investing in the cultivation of talents. The Company held the "2022 Chroma Precision Machinery and Measurement Technology Thesis Award" to encourage young students to engage in research and development and creative applications in the field of precision measurement, and to recruit talents for the industry, thereby promoting the upgrading and innovation of precision machinery and measurement technology and the sustainable development of society. (II) Activities to promote sustainable development in 2021 (1) Targets of donations in 2021: Friends of Taoyuan Police Association, Friends of Guishan Police Association, Chih-Yue Social Welfare Foundation, Boyo Social Welfare Foundation, Paper Windmill Arts and Educational Foundation,andNationalChiao Tung University Q557Scholarship

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Evaluation Items	State of implementation	State of implementation	State of implementation	Differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies, and causes thereof
	Yes	No	Summary and Explanation
Fund for disadvantaged students, with total donations of NT$2.62 million. (2) Promoted the concept of environmental protection to save energy and reduce carbon emissions by collecting used shoes and bags and delivered them to STEP30, the International Christian care association, so that the used shoes can be recycled and used again, as our response to jointly protect the environment any time any where (3) Cooperated with BUYNEARBY CO., LTD to provide fruits for employees' lunch to help farmers in remote areas, and help produce and sell agricultural products. (4) Continued to pay attention to environmental sustainability issues; the Company participated in the week's "Return the Sea Action Plan" on October 31, and organized a large-scale clean-up activity. 155 employeesparticipated and removed 496 kgof marine waste.

(2) Promoted the concept of environmental protection to save energy and reduce carbon emissions by collecting used shoes and bags and delivered them to STEP30, the International Christian care association, so that the used shoes can be recycled and used again, as our response to jointly protect the environment any time any where

(4) Continued to pay attention to environmental sustainability issues; the Company participated in the week's "Return the Sea Action Plan" on October 31, and organized a large-scale clean-up activity. 155 employees participated and removed 496 kg of marine waste.

(VII) Compliance with ethical corporate management and measures implemented

Evaluation item	State of implementation YesNo Summaryand Explanation	State of implementation YesNo Summaryand Explanation	State of implementation YesNo Summaryand Explanation	Differences with the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed corporations, and the cause thereof.
		No	Summaryand Explanation
I. Formulating ethical corporate management policies and programs (I) Has the Company established the ethical corporate management policies approved by the Board of Directors and specified in its rules and external documents the ethical corporate management policies and practices and the commitment of the Board of Directors and senior management to rigorous and thorough implementation of such policies? (III) Has the Company established a risk assessment mechanism against unethical conduct, analyzed and assessed activities within its business scopewhich are at a	ˇ ˇ		(I) The Company has formulated its “Ethical Corporate Management Best Practice Principles”, “Operating Rules for Ethical Corporate Management Best Practice Principles” and “Code of Ethical Conduct”, and relevant policies and proposals have been approved by the Board. The internal rules and regulations include the "Employee Reward and Punishment Regulations" and "Supplier Management Regulations" to actively implement the ethical corporate management policy. (II) The Company has evaluated and mitigated the risk of dishonest behavior, and preventive measures cover at least the behaviors specified in Paragraph 2,Article 7	No difference

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Evaluation item	State of implementation	State of implementation	State of implementation	Differences with the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed corporations, and the cause thereof.
	Yes	No	Summaryand Explanation
higher risk of being involved in unethical conduct regularly, and established prevention programs accordingly, which shall at least include the preventive measures specified in Paragraph 2, Article 7 of the "Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies"? (III) Has the Company specified in its prevention programs the operating procedures, guidelines, punishments for violations, and a grievance system and implemented them and reviewed the prevention programs regularly?	ˇ		of the Ethical Corporate Management Best Practice Principles of the Company. (III) In addition to communication to internal personnel of the Company regarding the importance of ethical conduct and prescribing various procedures for handling and forestalling unethical conducts within the "Code of Integrity Practice Rules", the Company also requires suppliers to sign a Supplier Commitment towards Business Integrity that clearly stipulates a prohibition against improper or unethical conduct during the process of business transaction. At the same time, the Company stipulated the Regulations for Employee Reward and Disciplinarian Actions as the basis for rewarding and penalizing employee conduct. The rewarding and penalizing of employee conduct, disciplinarian actions taken against violations, and handling of personal appeals are implemented according to these Regulations.
II. Implementing ethical corporate management (I) Has the Company evaluated the ethical records of its counterparty? Does the contract signed by the Companyand its tradingcounterparty	ˇ		(I) To ensure that mutual trust and integrity form the basis of all business dealings, the Company’s management regulations have	No difference

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Evaluation item	State of implementation	State of implementation	State of implementation	Differences with the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed corporations, and the cause thereof.
	Yes	No	Summaryand Explanation
clearly provide terms on ethical conduct? (II) Has the Company set up a dedicated unit under the Board of Directors to promote ethical corporate management and regularly (at least once every year) report to the Board of Directors the implementation of the ethical corporate management policies and prevention programs against unethical conduct? (III) Has the Company established policies to prevent conflicts of interest, provided an appropriate channel for reporting such conflicts and implemented them? (IV)Has the Companyestablished	ˇ ˇ ˇ		provided that suppliers must sign a letter of commitment towards business integrity which clearly prohibits any improper or unethical conduct in business activities and immediately blacklists any violators. Standard purchasing/sales contracts of the Company also clearly stipulate terms for business integrity and prohibition of unethical dealings and conduct. (II) The Company designated the Auditing Office directly under the Board of Directors as the responsible owner for revising, implementing, interpreting, providing counseling services, reporting, registering, and filing the contents of the Operational Rules for Best Practices for Ethical Corporate Management, supervising the implementation of these rules, and providing regular reports to the Board of Directors. The implementation and audit of ethical corporate management in the most recent year has been reported to the Board of Directors on December 23, 2021. (III) The Company has established the "Ethical Corporate Management Best Principles Practice", which clearly specifies the policy to prevent conflicts of interest. The official website of the Company displays an independent e-mail address and dedicated telephone line as channels for internal and external personnel of the Company to make whistleblower reports. Any report shall be immediately handled by the responsible unit. (IV)To implement ethical corporate

• 41 -

Evaluation item	State of implementation	State of implementation	State of implementation	Differences with the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed corporations, and the cause thereof.
	Yes	No	Summaryand Explanation
effective accounting systems and internal control systems to implement ethical corporate management and had its internal audit unit, based on the results of an assessment of the risk of involvement in unethical conduct, devise relevant audit plans and audit the compliance with the prevention programs accordingly or entrusted a CPA to conduct the audit? (V) Does the Company regularly hold internal and external training related to ethical corporate management?	ˇ		management, the Company has established an effective accounting system and internal control system according to the constituent elements of the internal system, and the internal auditing unit shall conduct audits according to the annual audit plan. (V) New recruits are regularly imparted with the Company's organizational, cultural, and internal workplace morality and ethics, emphasizing the importance of individual and professional integrity. Internal awareness programs also convey the importance of integrity. The rules and guidelines regarding ethical conduct are posted on the Company's website and are available for review by employees at all times. A total 8 sessions were held in 2021, with a total of 193 participants.
III. Implementation of the Company’s whistleblower reporting system (I) Has the Company established a specific whistleblowing and reward system, set up convenient whistleblowing channels, and designated appropriate personnel to handle investigations against wrongdoers? (II) Has the Company established the standard operating procedures for investigating reported misconduct, follow-up measures to be adopted after the investigation, and related confidentiality mechanisms?	ˇ ˇ		(I) The Company has established and announced an independent whistleblowing email address (audit@chroma.com.tw) and a dedicated telephone line (03- 3279999 ext.88301) for whistleblowers to report cases to the Company's dedicated personnel. (II) The Company stipulated standard operation procedures for handling whistle-blowing investigations as well as confidentiality mechanisms. The handling personnel shall investigate the case being	No difference

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Evaluation item	State of implementation	State of implementation	State of implementation	Differences with the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed corporations, and the cause thereof.
	Yes	No	Summaryand Explanation
(III) Has the Company set up protection for whistleblowers to prevent them from being subjected to inappropriate measures as a result of reporting such incidents?	ˇ		exposed by the whistle-blower, generate records, submit a report, file relevant documents, and ensure confidentiality of the identity of the whistle-blower and the content of the reported case. (III) The Company has established standard operating procedures for handling whistleblowing investigations and the relevant confidentiality mechanisms to maintain the confidentiality of whistleblowers' identities and the content of reported cases.
IV. Enhancing information disclosure (I) Has the Company disclosed the contents of its best practices for ethical corporate management and the effectiveness of relevant activities on its official website or Market Observation Post System (MOPS)?	ˇ		The Company has established an electronic bulletin Board, providing prompt announcements to relevant regulations and activities. Any regulations related to corporate governance as well as compliance to ethical conduct shall also be disclosed upon the Company’s official website.	No difference
V. If the Company has formulated its own principles of operation integrity based on the"Code of Integrity Practice Rules for TWSE/TPEx Listed corporations", please state the difference between its principles and its operation: No difference.
VI. Other important information that facilitates the understanding of the implementation of ethical corporate management: (such as review and amendment of the Company's Ethical Corporate Management Best Practice Principles) To ensure that employees at the Company comply with the Company's ethical standards, the Company has established the "Ethical Corporate Management Best Practice Principles", "Operational Rules for Ethical Corporate Management Best Practice Principles", and "Code of Ethical Conduct", so that every internal employee, supervisor and member of the Board of Directors better understands the ethical standards during performance of duties, and holds him or herself to high standards. For details regarding the operations and implementation of ethical corporate management at the Company, refer to the IV. Operation of corporate governance and (VII) Compliance with ethical corporate management and measures implemented of this annual report. For details regarding the Company's "Ethical Corporate Management Best Practice Principles", "Code of Ethical Conduct", and "Operational Rules for Ethical Corporate Management Best Practice Principles", visit MOPS or the official website of theCompany.

V. If the Company has formulated its own principles of operation integrity based on the"Code of Integrity Practice Rules for TWSE/TPEx Listed corporations", please state the difference between its principles and its operation: No difference.

VI. Other important information that facilitates the understanding of the implementation of ethical corporate management: (such as review and amendment of the Company's Ethical Corporate Management Best Practice Principles)

To ensure that employees at the Company comply with the Company's ethical standards, the Company has established the "Ethical Corporate Management Best Practice Principles", "Operational Rules for Ethical Corporate Management Best Practice Principles", and "Code of Ethical Conduct", so that every internal employee, supervisor and member of the Board of Directors better understands the ethical standards during performance of duties, and holds him or herself to high standards.

For details regarding the operations and implementation of ethical corporate management at the Company, refer to the IV. Operation of corporate governance and (VII) Compliance with ethical corporate management and measures implemented of this annual report. For details regarding the Company's "Ethical Corporate Management Best Practice Principles", "Code of Ethical Conduct", and "Operational Rules for Ethical Corporate Management Best Practice Principles", visit MOPS or the official website of the Company.

(VIII) If the Company has established the corporate governance best practice principles and other relevant regulations, the means to search for these regulations shall be disclosed. Refer to MOPS or the official website of the Company for details regarding the Corporate Governance Best Practice Principles formulated by the Company and specifications

• 43 -

provided by these best practice principles with regard to protecting shareholders’ rights and interests, enhancing the functions of the Board of Directors, respecting stakeholders’ rights and interests, and enhancing information transparency.

• (IX) Other important information to enhance the understanding of the implementation of corporate governance at the Company

The Company has stipulated "Prevention Management of Insider Trading" as the basis of the Company's major news and information disclosure mechanism. It is also inspected irregularly to ensure compliance with statutory laws and regulations and is published on the Company's internal website for inquiries.

• (X) Protective measures for the work environment and personal safety of employees

• (1) Employee safety:

  • Employee fire safety teams work with local fire departments to conduct fire safety and evacuation exercises, disaster prevention, and practical disaster response drills.

  • Established and enforced self-inspection plans to regularly inspect, maintain, and repair high- and low-voltage electrical equipment, elevators, air conditioning, fire safety equipment, potable water, water towers, and other forms of machinery and equipment to protect employee safety.

  • Commissioned professional cleaning corporations to maintain building sanitation and implement sterilization processes.

  • Commissioned qualified security firms to enforce access controls and security operations.

• (2) Employee insurance:

Used relevant laws and tables of insurance ranges as the basis to provide employees with labor and health insurance.

Purchase social insurances for personnel stationed overseas following local laws. Provided employees with regular life insurance, accidental injury insurance, accident, and health insurance, hospitalization insurance, cancer healthcare insurance, and workplace accident insurance.

• (3) Physical and mental health care for employees:

• Entrusted qualified medical institutions to regularly perform employee health checks, apply health checks that are superior to requirements prescribed by laws and regulations, and established a sound health management system to implement and implement health management to safeguard employee health.

• Incorporated the Sexual Harassment Prevention Act in employee work regulations, established the Sexual Harassment Prevention Committee, and designated dedicated personnel for handling such matters.

• Set up a nursing room and equipment to provide a comprehensive and high-quality breastfeeding environment for breastfeeding staff and maintain their breastfeeding privacy.

• Carried out four cancer screenings and special health check-ups each year to promote employee health care and early detection of diseases.

• AED automatic external defibrillators, first-aid kits and qualified first-aid personnel were set up at each factory site, and first-aid and AED education training courses were conducted. The branch office also obtained the certification for peace of mind and workplace safety.

• Established employee recreation centers with swimming pools, SPA, gyms, dance classrooms, equipment, and other materials for employee use.

• Conducted health promotion courses from time to time, such as emotional management, interpersonal communication, parenting, healthy eating, and health care.

• Regularly organizes health promotion activities, promotes healthy meals, diverse sports instruction courses, health promotion lectures, and health testing activities, etc. Every year, the Company provides measures for physical and mental relaxation, physical management, and weight control of disease prevention and health promotion.

• Regularly organizes health promotion activities, promotes healthy meals, and conducts a diverse range of sports and dancing areas within the perimeter of the factory.

• 44 -

(XI) Implementation of internal control system

1.The Statement on Internal Control System

Chroma ATE Co., Ltd.

The Statement on Internal Control System

Date: February 23, 2022

The Statement of Internal Control System is issued based on the Company’s 2021 self-assessment:

• I. The Company acknowledges that the establishment, implementation, and maintenance of the internal control system are the responsibilities of the Company’s Board of Directors and managerial officers, and has established such a system. The objectives of this system include achieving operational benefits and efficiency

• (including profitability, performance, as well as asset and safety protection), and ensuring the reliability, timeliness, transparency, and regulatory compliance of reporting, thereby providing reasonable assurance.

• II. An internal control system has inherent constraints. No matter how comprehensive its design may be, an effective internal control system is only capable of providing adequate assurance for achieving the abovementioned objectives. In addition, the effectiveness of an internal control system may change with the environment and under different situations. However, the Company’s internal control system has been furnished with self-monitoring systems. The Company shall also initiate corrective actions for any verified defects.

• III. The Company determines whether or not the design and implementation of its internal control system are effective according to the items for determining the effectiveness of internal control system as stated in the Regulations Governing Establishment of Internal Control Systems by Public Companies (hereinafter referred to as the "Regulations"). The internal control system is divided into 5 key components according to the process of management control to generate internal control system assessment items adopted by the Regulations, including: 1. control environment; 2. risk assessment; 3. control operations; 4. information and communications and; 5. monitoring operations. Each key component also includes several sub-items. Refer to the Regulations for more information on the abovementioned items.

• IV. The Company has adopted the aforementioned internal control system assessment items to evaluate the effectiveness of its ICS design and implementation.

• V. Based on the findings of such evaluation, the Company believes that, on December 31, 2021, it has maintained, in all material respects, an effective internal control system (that includes the supervision and management of our subsidiaries), to provide reasonable assurance as to our operational effectiveness and efficiency, reliability, timeliness, transparency of reporting, and compliance with applicable rulings, laws, and regulations.

• VI. The Statement shall be a major item of the Company and the design and implementation shall be publicly disclosed. Where any of the disclosed content contains misrepresentations, non-disclosures, or other illegal acts, the Company shall be subject to legal responsibilities provided in Articles 20, 32, 171, and 174 of the Securities and Exchange Act.

• VII. This statement has been approved by the Board of Directors on February 23, 2022 . Amongst the 7 directors that attended the meeting, none objected, and the remaining have all agreed with the contents of this statement.

Chroma ATE Co., Ltd. Chairman: Leo Huang signature President: Leo Huang signature

1. Where CPAs are commissioned to audit the Company's internal control system, the audit report prepared by the CPAs shall be disclosed: None.

2. 45 -

3. (XII) Penalties imposed on the Company and its internal staff, penalties imposed on its internal staff by the Company for violation of internal control regulations, major deficiencies and status of improvements made in the most recent year up to the publication date of this annual report: None.

(XIII) Major resolutions of the Shareholders’ Meeting and the Board of Directors in the most recent year up to the publication date of this annual report 1. Major resolutions of the Shareholders' Meeting and status of implementation Date 2021 Regular Shareholders’ Meeting convened 2021.08.18 1.Adoption of 2020 business report and financial statements. Status of implementation: The resolution was passed. 2. Adoption of 2020 earnings distribution. Status of implementation: The resolution was passed. The Company’s distribution of earnings was in the form of cash dividends, which was approved by the Board of Directors on February 25, 2021, and the exdividend date was set as June 29, 2021 by the Board of Directors on June 7, 2021. Cash dividends to shareholders were paid on July 15, 2021. (Dividends of NT$4.49960510 per share), which was presented to the Shareholders' Meting on August 18, 2021. 2. Key resolutions of the Board of Directors 2021.02.25 1. Approval of the annual rewards for directors and supervisors, and attendance fees for directors who attended Audit Committee meetings 2. Approval of 2021 compensation for members of the Audit Committee, and attendance fees for members who attended Audit Committee meetings 3. Approval of 2020 employee bonus distribution plan. 4. Approval of 2020 business report and financial statements. 5. Approval of 2020 earnings distribution. 6. Issuance of the Company’s 2020 statement of internal control system. 7. Approval of capital loans to Chroma Japan Corp. 8. Approval of the fact ompany’s receivables overdue for more than 90 days are not of a fund loan nature. 9. Approval of 2021 business plan. 10. Convening of 2021 regular shareholders’ meeting and collection of shareholders’ proposals. 2021.04.28 1. Q1 2021 financial statements. 2. Approval of Chroma ATE Inc. (USA) endorsement and guarantee 3. Approval of the endorsement and guarantee for Chroma ATE Europe BV. 4. Approval of the fact that the Company’s receivables overdue for more than 90 days are not of a fund loan nature. 5. Approval of replacement of attesting CPAs and evaluation of independence 6. Approval of capital increase of Touch Cloud Inc. 7. Approval of the appointment of the corporate governance officer for the Company. 8. Approval of the application of "CHROMA ATE INC for a new plant site for the manufacture and sale of medical devices. 9. Approval of the capital increase base date for employee stock options. 10. Approval of line of credit extension between financial institutions and the Company. 2021.06.07 Approval of 2021 base date of the dividend distribution and subscription price adjustment of employee stock options. 2021.07.29 1. Q2 2021 financial statements. 2. Approval of change of the date of the 2021 regular shareholders’ meeting. 3. Approval of 2020 bonus distribution to the Company’s managerial officers. 4. Approval of amendments to the “Regulations Governing the Evaluation of the Performance of the Board of Directors”. 5. Approval of capital loan for Chroma Systems Solutions, Inc.

• 46 -

• Approval of endorsement and guarantee for MAS Automation Corp. 7. Approval of 2021 CPA professional fees. 8. Approval of the fact that the Company’s receivables overdue for more than 90 days are not of a fund loan nature. 9. Approval of amendments to the Company’s accounting system. 10. Approval of cash capital increase of TFBS Bioscience, Inc. 11. Approval of the financial institution application for line of credit. 2021.10.28 1. Q3 2021 financial statements. 2. Approval of the capital increase base date for employee stock options. 3. Approval of endorsement and guarantee for MAS Automation Corp. 4. Approval of the fact that the Company’s receivables overdue for more than 90 days are not of a fund loan nature. 2021.12.23 1. Approval of the 2022 audit plan. 2. Approval of amendments to the Company’s “Internal Control System” and “Enforcement Rules for Internal Audit” 3. Approval of capital loan for Chroma Systems Solutions, Inc. 4. Approval of endorsements and guarantees for subsidiaries in Mainland China. 5. Approval of the endorsement and guarantee for Chroma Japan Corp. 6. Approval of donation to establish the Chroma Cultural and Educational Foundation. 7. Approval of amendments to “Corporate Governance Best Practice Principles” and “Corporate Social Responsibility Best Practice Principles” of the Company. 8. Approval of the capital increase base date for employee stock options. 2022.01.11 Approval of the closing of the subsidiary “Chroma New Material Corporation”. 2022.02.23 1. Approval of the annual rewards for directors and supervisors, and attendance fees for directors who attended Audit Committee meetings. 2. Approval of 2022 compensation for members of the Audit Committee, and attendance fees for members who attended Audit Committee meetings. 3. Approved the 2022 salary adjustment for managerial officers. 4. Approval of 2021 employee bonus distribution plan. 5. Approval of 2021 business report and financial statements. 6. Approval of 2021 earnings distribution. 7. Issuance of the Company’s 2021 statement of internal control system. 8. Approval of capital loans to Chroma Japan Corp. 9. Approved of the establishment of the Company’s Provision of Financial Loans to Other Parties. 10. Approval of the loan of funds between the Company's 100%-owned foreign subsidiaries. 11. Approval of amendments to the Company's "Procedures for Acquisition and Disposal of Assets". 12. Approval of the Company’s receivables overdue for more than 90 days being not of a fund loan nature. 13. Approval of the Company’s issuance of new employee restricted stocks 14. Approval of investment in ENTELIGENT INC. 15. Approval of 2022 business plan. 16. Approval of amendments to the Company’s Articles of Incorporation 17. Convening of 2022 regular shareholders’ meeting and collection of shareholders’ proposals.

• (XIV) Dissenting opinions or qualified opinions on resolutions passed by the Board of Directors which are made by directors and are documented or issued through written statements, in the most recent year up to the publication date of this annual report: None.

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• (XV) Any resignation or dismissal of the Company's chairperson of the Board, president, accounting manager, financial executive, internal audit manager, and research and development executive in the most recent year up to the publication date of this report: None.

• V. Information on the CPAs’ professional charge

• (I) Amount of audit and non-audit fees paid to CPAs, accounting firm and its affiliated companies, and content of non-audit services

Information on the CPAs’ professional fees

Amount unit: In thousands of NT$

Name of the accounting firm	Name of the CPA	Period of CPA audit	Audit fee	Non-audit fee	Total	Remark
Deloitte & Touche	Wen-Chin Lin Chien-Liang Liu	2021.01.01~ 2021.12.31	6,160	1,713	7,873	Non-audit fees were for TP payment, subsidiary audit disbursement, English report, direct credit check, accounting standards advisory service, CPA review of acquisition of real estate and salaries, etc.

• (II) Where the accounting firm was replaced, and the audit fees for the year when replacement was made were less than those in the previous fiscal year before replacement, the amount of audit fees paid before replacement and the reasons for paying such an amount shall be disclosed: None.

• (III) Where the audit fees for the year were reduced by more than 10% compared to the previous year, the amount and percentage of decrease in audit fees, as well as the reason for such decrease shall be disclosed: None.

• 48 -

VI. Replacement of CPAs

(I) About the predecessor CPAs

Date of replacement	Approved bythe Board of Directors on April 28,2021	Approved bythe Board of Directors on April 28,2021	Approved bythe Board of Directors on April 28,2021	Approved bythe Board of Directors on April 28,2021	Approved bythe Board of Directors on April 28,2021
Reason for replacement	In accordance with the internal rotation of Deloitte and Touche, the attesting CPAs Cheng-Ming Lee and Wen-Chi, Kuo were replaced by Wen-Chin Lin and Chien-Liang Liu effective from the first quarter of 2021.
Indicate whether the appointment is terminated or not accepted by the client or CPAs	Party involved Circumstance			CPA	Client
	Proactively terminated the appointment			Not applicable	Not applicable
	Not accepted (continued) the appointment			Not applicable	Not applicable
Opinions on audit reports issued within the last two years without qualification andreasons	None
Any disagreement with the issuer	Yes		Accounting principles orpractices
			Disclosure of financialstatements
			Audit scope or procedures
			Others
	None	ˇ
	Explanation
Other disclosures (required to be disclosed under paragraphs 6.1-6.7 of Article 10 of the Regulations)	None

(II) About the successor CPAs

to be disclosed under paragraphs 6.1-6.7 of Article 10 of the Regulations) None (II) About the successor CPAs
Name ofthe accountingfirm Name ofthe CPA Date ofappointment Matters and results of consultation on the accounting treatment or accounting principles for specific transactions and on the possible issuance of financial statements priorto the appointment Written opinion of the successor CPA on matters on which the successor CPAs disagreed with the predecessor CPAs .	Deloitte &Touche
	Wen-Chin Lin, Chien-LiangLiu
	Approved by theBoard of Directors on April 28,2021
	None
	None

(III) The predecessor CPAs’ reply to paragraphs 1.6.1 and 1.6.2.3 of Article 10 of the Regulations: None.

• 49 -

• VII. The Company's Chairman, president, or any managerial officer in charge of finance or accounting matters who has held a position at the accounting firm of its CPAs or at an affiliated company in the most recent year: None.

• VIII. Shareholding transfer and equity pledge changes of directors or managerial officers holding more than ten percent (10%) of Company shares during the most recent year up to the publication date of this annual report

• Transfer of shares and changes in equity pledge relating to the directors, managerial officers and primary shareholders:

and primary shareholders:
Position title	Name	2021		2022,as of April 11
		Increase (decrease) in the number of shares held	Increase (decrease) in the number of shares pledged	Increase (decrease) in the number of shares held	Increase (decrease) in the number of shares pledged
Chairperson and CEO	Leo Huang	0	0	0	0
Director and President, Integrated System Solution BU	I-Shih Tseng	(192,000)	0	0	0
Director	Tsun-I Wang	(339)	0	0	0
Director	Chung-Ju Chang	0	0	0	0
Independent director	Tai-Jen George Chen	0	0	0	0
Independent director	Jia-Ruey Duann	0	0	0	0
Independent director	Steven Wu	0	0	0	0
President,Test & Measurement BU	David Yang	(42,000)	0	0	0
President, Intelligent Manufacturing System BU	Joe Lin	0	0	(5,000)	0
President, Semiconductor Test Equipment BU	George Chang	(9,000)	0	0	0
Senior Vice President of Finance & AdministrationCenter	Paul Ying	(32,000)	0	0	0
Senior Vice President of Manufacturing Center	Steven Liu	(18,000)	0	0	0
Senior Vice President, Operation Management Center	Benjamin Huang	(15,000)	0	0	0
Vice President, Sales Division 1, Integrated SystemSolution BU	Herbert Tsai	(1,000)	0	0	0
Vice President,CEO Office	C.C.Fan	(17,000)	0	0	0
Vice President, Product Planning Division, Test &MeasurementBU	Bobby Tseng	(5,000)	0	0	0
Vice President, Greater China Area Sales Division,Test &MeasurementBU	Vincent Chen	0	0	0	0
Vice President, Technical Service Division,Test &MeasurementBU	Tony Yang	0	0	0	0
Vice President, R&D Division, Test & MeasurementBU	Vincent Wu	0	0	0	0
Vice President, R&D Division 1, Integrated SystemSolution BU	Lance Ouyang	0	0	0	0
Vice President, Sales Division 2, Integrated SystemSolution BU	Jeff Lee	0	0	0	0
Vice President, Product Planning Division, Test &MeasurementBU	Kenny Wang	0	0	0	0
Vice President, Turnkey Solution Sales & Marketing Division, Test & Measurement BU	Cindy Tai	(9,000)	0	(6,000)	0

• 50 -

Position title	Name	2021	2021	2022,as of April 11	2022,as of April 11
		Increase (decrease) in the number of shares held	Increase (decrease) in the number of shares pledged	Increase (decrease) in the number of shares held	Increase (decrease) in the number of shares pledged
Vice President, Product Planning Division, Test &MeasurementBU	Galen Chou	(2,000)	0	0	0
Vice President, Marketing Division, IntelligentManufacturing System BU	Arno Wu	(24,250)	0	0	0
Vice President, Product Planning Division, Optical Inspection Solution BU	Alex Zheng	0	0	0	0
Vice President, Product Planning Office, Semiconductor Test Equipment BU	Eugene Lin	0	0	0	0
Corporate governance officer	Amy Huang (Note1)	0	0	0	0

Note 1: Assigned as the corporate governance officer on April 28, 2021 so the changes in her shareholding since that date are provided.

2. Where the counterparty for equity transfer is a related party

Name	Reason for equity transfer	Transaction date	Transaction counterparty	Relationship between the trading counterparty and the Company, directors, supervisors and shareholders holding more than 10 percent of the shares	Number of shares	Transaction price
I-Shih Tseng	Serving as payment of shares	2021.12.27	Yishimin Co., Ltd.	Director’s shareholding in the name of others	120,000	180

3. Where the counterparty of equity pledged is a related party: None.

• 51 -

IX. Information on the ten largest shareholders who are related parties or each other's spouses and relatives within the second degree of kinship

Relationship information between the 10 largest shareholders

Name (Note)	Shares held by the person	Shares held by the person	Shares held by spouse or minor children	Shares held by spouse or minor children	Shares held in the name of others	Shares held in the name of others	Title or name and relationships of the 10 largest shareholders where they are related parties, spouses, or relatives within the second degree of kinship.	Title or name and relationships of the 10 largest shareholders where they are related parties, spouses, or relatives within the second degree of kinship.	Remark
	Number of shares	Shareholding percentage	Number of shares	Shareholding percentage	Number of shares	Shareholding percentage	Name	Relations
Leo Huang	20,859,897	4.94%	9,294,362	2.20%	0	0	Shu-Chuan Chen	Spouse
Chun-Sheng Chen	15,113,308	3.58%	11,074,646	2.62%	0	0	Yu-Mei Hsueh	Spouse
JPMorgan Chase Bank N.A., Taipei Branch in custody for Stichting Depositary APG Emerging Markets Equity Pool	14,256,000	3.37%	0	0	0	0	None	None
JPMorgan Chase Bank N.A., Taipei Branch in custody for Schroder International Selection Fund - Asian Absolute Return	13,460,000	3.19%	0	0	0	0	None	None
Yu-Mei Hsueh	11,074,646	2.62%	15,113,308	3.58%	0	0	Chun- Sheng Chen	Spouse
First State Asia Pacific Leaders fund a sub fund of First State Investment	9,459,000	2.24%	0	0	0	0	None	None
Shu-Chuan Chen	9,294,362	2.20%	20,859,897	4.94%	0	0	Leo Huang	Spouse
JPMorgan Chase Bank N.A., Taipei Branch in custody for Schroder International Selection Fund- Global Climate Change Equity	9,164,000	2.17%	0	0	0	0	None	None
Nan Shan Life Insurance Co., Ltd Representative: Tang Chen	8,662,000	2.05%	0	0	0	0	None	None
BNP Paribas Funds' Green Tiger under the custodianship of HSBC	5,703,000	1.35%	0	0	0	0	None	None

Note: The 10 largest shareholders shall be listed. For corporate shareholders, the title of the corporate shareholder as well as the name of the representative shall be indicated.

• 52 -

• X. Number of shares held and combined shareholdings percentage in the same investment business by the Company, the Company's directors, managerial officers, and companies directly or indirectly controlled by the Company

Consolidated shareholding percentage

Unit: In thousands of shares / in thousands of foreign currency

Investee (Note 1))	Investments by the Company	Investments by the Company	Investments of Directors and managerial officers and directly or indirectly controlled businesses	Investments of Directors and managerial officers and directly or indirectly controlled businesses	Total investments	Total investments
	Number of shares	Shareholding percentage (%)	Number of shares	Shareholding percentage (%)	Number of shares	Shareholding percentage (%)
Neworld Electronics Limited	64,013	100.0	0	0	64,013	100.0
ADLINK TechnologyInc.	24,432	11.2	17	0	24,449	11.2
Chroma New Material Corporation	25,000	100.0	0	0	25,000	100.0
Chroma Investment Co.,Ltd.	14,000	100.0	0	0	14,000	100.0
DynaScan TechnologyCorp.	9,841	27.3	4,640	12.9	14,481	40.2
SENSATIONAL HOLDINGS LTD.	1,200	100.0	0	0	1,200	100.0
CHROMA ATE EUROPE B.V.	1	100.0	0	0	1	100.0
CHROMA ATE INC.	1,000	100.0	0	0	1,000	100.0
CHROMA SYSTEMS SOLUTIONS, INC.(Note 2)	120	25.0	240	50.0	360	75.0
CHEN HWA TECHNOLOGY INC.	3,085	100.0	0	0	3,085	100.0
CHI INCORPORATION LTD.	3,830	100.0	0	0	3,830	100.0
SAN EAGLE DEVELOPMENT CORP	2,050	100.0	0	0	2,050	100.0
Testar Electronic Corporation	20,160	67.2	5,064	16.9	25,224	84.1
MAS Automation Corp.	10,000	100.0	0	0	10,000	100.0
DeepRed HoldingCo., Ltd	215	100.0	0	0	215	100.0
Chroma Japan Corp.	10	100.0	0	0	10	100.0
Chih Ho Shun Development Co., Ltd.	1,750	35.0	0	0	1,750	35.0
Adivic TechnologyCo.	12,590	74.1	0	0	12,590	74.1
EVT TechnologyCo., Ltd.	9,412	85.6	89	0.8	9,501	86.4
QUANTEL PRIVATE LTD.	1,914	60.0	0	0	1,914	60.0
Innovative Nanotech Incorporated	14,214	67.2	800	3.8	15,014	71.0
Touch Cloud Inc.	11,046	83.1	0	0	11,046	83.1
Camtek Ltd.	7,817	17.8	0	0	7,817	17.8
ADIVIC HOLDING CORPORATION	0	0	1,000	100.0	1,000	100.0
WEI KUANG MECH.ENG.INC.	0	0	4,475	100.0	4,475	100.0
Quantel Technologies India Private Ltd.	0	0	65	100.0	65	100.0
Quantel Global Vietnam Co., Ltd.(Note 3)	0	0	US$200	100.0	US$200	100.0
Quantel Global Sdn. Bhd.	0	0	600	100.0	600	100.0
Quantel Global Philippines Corporation	0	0	99	100.0	99	100.0
Quantel Global CompanyLimited	0	0	30	99.9	30	99.9
Chroma GermanyGmbH	0	0	30	100.0	30	100.0
Sajet System Technology (Suzhou) Co., Ltd.(Note 3)	0	0	RMB$8,374	100.0	RMB$8,374	100.0
Chroma Electronics (Shenzhen) Co., Ltd. (Note 3)	0	0	HK$30,000	100.0	HK$30,000	100.0
Chroma Electronics (Shanghai) Co., Ltd. (Note 3)	0	0	US$3,000	100.0	US$3,000	100.0

• 53 -

Chroma (Shanghai) Trading Co., Ltd. (Note 3)	0	0	US$2,700	100.0	US$2,700	100.0
Chroma ATE(Suzhou)Co., Ltd.(Note 3)	0	0	US$3,800	100.0	US$3,800	100.0
Mou Kuan Technologies (Nanjin) Co., Ltd. (Note 3)	0	0	RMB$1,737	100.0	RMB$1,737	100.0
Wei Kuang Automatic Equipment (Nanjin) Co., Ltd.(Note 3)	0	0	RMB$11,871	100.0	RMB$11,871	100.0
Wei Kuang Automatic Equipment (Xiamen) Co., Ltd. (Note 3)	0	0	RMB$11,417	100.0	RMB$11,417	100.0

Note 1: The equity method was employed for the Company's investments.

Note 2: The consolidated shareholding percentage of the Company and its subsidiary Chroma ATE Inc. was 75%.

Note 3: These investee companies have yet to issue any share. Therefore, only the amount and percentage of capital contribution are indicated.

• 54 -

Chapter4 Capital Raising

I. Capital and shares

(I) Source of shares

Year and month	Issuing price	Authorized capital	Authorized capital	Paid-incapital	Paid-incapital	Remark	Remark	Remark
		Number of shares (in thousands of shares)	Amount (in thousands of NT$)	Number of shares (in thousands of shares)	Amount (in thousands of NT$)	Source of capital	Equity contributio ns made in the form of assets other than cash	Others
1996.08	10	70,000	700,000	54,365	543,650	Recapitalizationof retained earnings	None	Note1
1997.08	10	100,000	1,000,000	79,300	793,000	Recapitalization of retained earnings: NT$149,350,000 Cash capital increase by NT$100,000,000	None	Note 2
1998.06	10	150,000	1,500,000	115,200	1,152,000	Recapitalization of retained earnings: NT$259,000,000 Cash capital increase by NT$100,000,000	None	Note 3
1999.05	10	200,000	2,000,000	152,160	1,521,600	Recapitalization of retained earnings: NT$312,000,000 Recapitalization of capital surplus: NT$57,600,000	None	Note 4
2000.06	10	250,000	2,500,000	201,300	2,013,000	Recapitalization of retained earnings: NT$415,320,000 Recapitalization of capital surplus: NT$76,080,000	None	Note 5
2001.01	10	250,000	2,500,000	208,358	2,083,588	Capital increase in connection with merger: NT$70,580,000	None	Note 6
2001.03	10	250,000	2,500,000	201,358	2,013,588	Treasury stock extinguished: NT$70,000,000	None	Note 7
2001.07	10	320,000	3,200,000	234,300	2,343,000	Recapitalization of retained earnings: NT$269,000,000 Recapitalization of capital surplus: NT$60,400,000	None	Note 8
2002.07	10	320,000	3,200,000	252,690	2,526,900	Recapitalization of retained earnings: NT$19,890,000 Recapitalization of capital surplus: NT$164,010,000	None	Note 9
2003.07	10	360,000	3,600,000	272,289	2,722,892	Recapitalization of retained earnings: NT$195,990,000	None	Note 10
2004.03	10	360,000	3,600,000	252,579	2,525,787	Treasury stock extinguished: NT$200,000,000 Stocks converted from stock options: NT$2,890,000	None	Note 11
2004.07	10	360,000	3,600,000	262,705	2,627,052	Recapitalization of capital surplus: NT$96,520,000 Stocks converted from stock options: NT$4,750,000	None	Note 12
2004.10	10	360,000	3,600,000	263,405	2,634,047	Stocks converted from stock options: NT$7,000,000	None	Note 13
2005.01	10	360,000	3,600,000	263,882	2,638,819	Stocks converted from stock options: NT$4,770,000	None	Note 13
2005.03	10	360,000	3,600,000	264,171	2,641,709	Stocks converted from stock options: NT$2,890,000	None	Note 13
2005.07	10	360,000	3,600,000	272,374	2,723,744	Recapitalization of retained earnings: NT$75,130,000 Stocks converted from stock options: NT$6,910,000	None	Note 14
2005.10	10	360,000	3,600,000	272,693	2,726,929	Stocks converted from stock options: NT$3,190,000	None	Note 15
2006.01	10	360,000	3,600,000	274,258	2,742,584	Stocks converted from stock options: NT$15,660,000	None	Note 15

• 55 -

Year and month	Issuing price	Authorized capital	Authorized capital	Paid-incapital	Paid-incapital	Remark	Remark	Remark
		Number of shares (in thousands of shares)	Amount (in thousands of NT$)	Number of shares (in thousands of shares)	Amount (in thousands of NT$)	Source of capital	Equity contributio ns made in the form of assets other than cash	Others
2006.03	10	360,000	3,600,000	274,932	2,749,317	Stocks converted from stock options: NT$6,730,000	None	Note 15
2006.06	10	360,000	3,600,000	284,344	2,843,442	Recapitalization of retained earnings: NT$81,370,000 Stocks converted from stock options: NT$12,760,000	None	Note 16
2006.10	10	360,000	3,600,000	285,154	2,851,542	Stocks converted from stock options: NT$8,100,000	None	Note 15
2007.01	10	360,000	3,600,000	286,378	2,863,779	Stocks converted from stock options: NT$12,240,000	None	Note 15
2007.03	10	360,000	3,600,000	287,410	2,874,099	Stocks converted from stock options: NT$10,320,000	None	Note 15
2007.08	10	400,000	4,000,000	302,311	3,023,114	Recapitalization of retained earnings: NT$142,490,000 Stocks converted from stock options: NT$6,520,000	None	Note 17
2007.10	10	400,000	4,000,000	302,713	3,027,134	Stocks converted from stock options: NT$4,020,000	None	Note 15
2008.01	10	400,000	4,000,000	304,244	3,042,441	Stocks converted from stock options: NT$15,310,000	None	Note 15
2008.03	10	400,000	4,000,000	305,058	3,050,581	Stocks converted from stock options: NT$8,140,000	None	Note 15
2008.08	10	400,000	4,000,000	329,542	3,295,419	Recapitalization of retained earnings: NT$234,820,000 Stocks converted from stock options: NT$10,020,000	None	Note 18
2008.10	10	400,000	4,000,000	329,664	3,296,644	Stocks converted from stock options: NT$1,230,000	None	Note 15
2009.01	10	400,000	4,000,000	329,915	3,299,151	Stocks converted from stock options: NT$2,510,000	None	Note 15
2009.03	10	400,000	4,000,000	331,600	3,316,004	Stocks converted from stock options: NT$16,850,000	None	Note 15
2009.07	10	450,000	4,500,000	348,909	3,489,089	Recapitalization of retained earnings: NT$166,100,000 Stocks converted from stock options: NT$6,990,000	None	Note 19
2009.10	10	450,000	4,500,000	349,598	3,495,984	Stocks converted from stock options: NT$6,900,000	None	Note 15
2010.01	10	450,000	4,500,000	349,767	3,497,674	Stocks converted from stock options: NT$1,690,000	None	Note 15
2010.03	10	450,000	4,500,000	350,076	3,500,756	Stocks converted from stock options: NT$3,080,000	None	Note 15
2010.07	10	450,000	4,500,000	362,077	3,620,771	Recapitalization of retained earnings: NT$105,500,000 Stocks converted from stock options: NT$14,520,000	None	Note 20
2010.10	10	450,000	4,500,000	362,144	3,621,441	Stocks converted from stock options: NT$670,000	None	Note 15
2011.01	10	450,000	4,500,000	362,269	3,622,691	Stocks converted from stock options: NT$1,250,000	None	Note 15
2011.07	10	450,000	4,500,000	376,760	3,767,599	Recapitalization of retained earnings: NT$144,910,000	None	Note 21
2014.12	10	450,000	4,500,000	378,086	3,780,862	Stocks converted from convertible corporate bonds: NT$13,260,000	None	Note 22
2015.01	10	450,000	4,500,000	378,782	3,787,821	Stocks converted from convertible corporate bonds: NT$6,960,000	None	Note 22
2015.05	10	450,000	4,500,000	378,786	3,787,862	Stocks converted from convertible corporate bonds: NT$40,000	None	Note 22
2015.11	10	450,000	4,500,000	379,030	3,790,300	Stocks converted from stock	None	Note 23

• 56 -

Year and month	Issuing price	Authorized capital	Authorized capital	Paid-incapital	Paid-incapital	Remark	Remark	Remark
		Number of shares (in thousands of shares)	Amount (in thousands of NT$)	Number of shares (in thousands of shares)	Amount (in thousands of NT$)	Source of capital	Equity contributio ns made in the form of assets other than cash	Others
						options: NT$2,440,000
2016.01	10	450,000	4,500,000	379,170	3,791,698	Stocks converted from stock options: NT$1,400,000	None	Note 23
2016.05	10	450,000	4,500,000	379,693	3,796,934	Stocks converted from convertible corporate bonds: NT$2,890,000 Stocks converted from stock options: NT$2,350,000	None	Notes 22~23
2016.07	10	450,000	4,500,000	383,373	3,833,732	Stocks converted from convertible corporate bonds: NT$4,620,000 Stocks converted from stock options: NT$1,180,000 New employee restricted stocks: NT$31,000,000	None	Notes 22~24
2016.12	10	450,000	4,500,000	387,158	3,871,576	Stocks converted from convertible corporate bonds: NT$28,500,000 Stocks converted from stock options: NT$9,350,000	None	Notes 22~23
2017.01	10	450,000	4,500,000	389,887	3,898,872	Stocks converted from convertible corporate bonds: NT$23,820,000 Stocks converted from stock options: NT$3,470,000	None	Notes 22~23
2017.05	10	450,000	4,500,000	405,090	4,050,904	Stocks converted from convertible corporate bonds: NT$149,580,000 Stocks converted from stock options: NT$2,450,000	None	Notes 22~23
2017.06	10	450,000	4,500,000	405,275	4,052,754	New employee restricted stocks: NT$1,850,000	None	Note 24
2017.07	10	450,000	4,500,000	405,263	4,052,631	Write-off NT$120,000 of new employeerestricted stock	None	Note 24
2017.08	10	450,000	4,500,000	408,051	4,080,513	Stocks converted from convertible corporate bonds: NT$27,220,000 Stocks converted from stock options: NT$670,000	None	Notes 22~23
2017.11	10	450,000	4,500,000	409,410	4,094,101	Stocks converted from convertible corporate bonds: NT$4,300,000 Stocks converted from stock options: NT$9,290,000	None	Notes 22~23
2018.01	10	450,000	4,500,000	411,894	4,118,942	Stocks converted from convertible corporate bonds: NT$20,420,000 Stocks converted from stock options: NT$4,430,000	None	Notes 22~23
2018.05	10	450,000	4,500,000	412,953	4,129,532	Stocks converted from convertible corporate bonds: NT$220,000 Stocks converted from stock options: NT$10,910,000 New employee restricted stocks extinguished: NT$540,000	None	Notes 22~25
2018.09	10	450,000	4,500,000	414,359	4,143,594	Stocks converted from convertible corporate bonds: NT$80,000 Stocks converted from stock options: NT$14,070,000 New employee restricted stocks extinguished: NT$90,000	None	Notes 22~25
2018.11	10	450,000	4,500,000	416,443	4,164,431	Stocks converted from convertible corporate bonds: NT$14,940,000 Stocks converted from stock options: NT$6,100,000 New employee restricted stocks extinguished: NT$210,000	None	Notes 22~25

• 57 -

Year and month	Issuing price	Authorized capital	Authorized capital	Paid-incapital	Paid-incapital	Remark	Remark	Remark
		Number of shares (in thousands of shares)	Amount (in thousands of NT$)	Number of shares (in thousands of shares)	Amount (in thousands of NT$)	Source of capital	Equity contributio ns made in the form of assets other than cash	Others
2019.01	10	450,000	4,500,000	416,779	4,167,794	Stocks converted from convertible corporate bonds: NT$900,000 Stocks converted from stock options: NT$2,460,000	None	Notes 22~ 23, and 25
2019.03	10	450,000	4,500,000	416,717	4,167,174	New employee restricted stocks extinguished: NT$620,000	None	Note 24
2019.05	10	450,000	4,500,000	417,394	4,173,942	Stocks converted from stock options: NT$ 6,770,000	None	Notes 23, 25
2019.07	10	500,000	5,000,000	417,382	4,173,823	Write-off NT$120,000 of new employeerestricted stock	None	Note 24
2019.08	10	500,000	5,000,000	419,093	4,190,926	Stocks converted from stock options: NT$17,370,000 New employee restricted stocks extinguished: NT$270,000	None	Notes 23~25
2019.11	10	500,000	5,000,000	419,296	4,192,961	Stocks converted from stock options: NT$2,040,000	None	Note 25
2020.03	10	500,000	5,000,000	419,526	4,195,256	Stocks converted from stock options: NT$2,300,000	None	Note 25
2020.05	10	500,000	5,000,000	419,821	4,198,212	Stocks converted from stock options: NT$3,080,000 Write-off NT$120,000 of new employeerestricted stock	None	Notes 24~25
2020.08	10	500,000	5,000,000	420,748	4,207,484	Stocks converted from stock options: NT$10,330,000 Write-off NT$1,060,000 of new employeerestricted stocks	None	Notes 24~25
2020.11	10	500,000	5,000,000	421,094	4,210,944	Stocks converted from stock options: NT$3,520,000 Write-off NT$60,000 of new employeerestricted stocks	None	Notes 24~25
2021.01	10	500,000	5,000,000	421,295	4,212,945	Stocks converted from stock options: NT$2,000,000	None	Note 25
2021.05	10	500,000	5,000,000	421,632	4,216,315	Stocks converted from stock options: NT$3,370,000	None	Note 25
2021.11	10	500,000	5,000,000	421,742	4,217,415	Stocks converted from stock options: NT$1,100,000	None	Note 25
2022.01	10	500,000	5,000,000	421,875	4,218,745	Stocks converted from stock options: NT$1,330,000	None	Note 25
2022.03	10	500,000	5,000,000	422,487	4,224,870	Stocks converted from stock options: NT$6,130,000	None	Note 26

• Note 1: Approved by the Securities and Exchange Commission, Ministry of Finance as per letter with Ref. No. (85) Taiwan-Finance-Securities (I) 41514 on July 8, 1996.

• Note 2: Approved by the Securities and Exchange Commission, Ministry of Finance as per letter with Ref. No. (86) Taiwan-Finance-Securities (I) 45915 on June 25, 1997.

• Note 3: Approved by the Securities and Exchange Commission, Ministry of Finance as per letter with Ref. No. (87) Taiwan-Finance-Securities (I) 46094 on June 8, 1998.

• Note 4: Approved by the Securities and Exchange Commission, Ministry of Finance as per letter with Ref. No. (88) Taiwan-Finance-Securities (I) 48548 on May 24, 1999.

• Note 5: Approved by the Securities and Exchange Commission, Ministry of Finance as per letter with Ref. No. (89) Taiwan-Finance-Securities (I) 49542 on June 8, 2000.

• Note 6: Approved by the Securities and Exchange Commission, Ministry of Finance as per letter with Ref. No. (89) Taiwan-Finance-Securities (I) 83405 on December 18, 2000.

• Note 7: Approved by the Securities and Exchange Commission, Ministry of Finance as per letter with Ref. No. (89) Taiwan-Finance-Securities (III) 102418 on December 22, 2000.

• Note 8: Approved by the Securities and Exchange Commission, Ministry of Finance as per letter with Ref. No. (90) Taiwan-Finance-Securities (I) 137773 on June 13, 2001.

• Note 9: Approved by the Securities and Exchange Commission, Ministry of Finance as per letter with Ref. No. Taiwan-Finance-Securities (I) 0910132477 on June 14, 2002.

• Note 10: Approved by the Securities and Exchange Commission, Ministry of Finance as per letter with Ref. No. Taiwan-Finance-Securities (I) 0920125022 on June 9, 2003.

• Note 11: Approved by the Securities and Exchange Commission, Ministry of Finance as per letters with Ref. No. Taiwan-Finance-Securities (III) 0920162383 on January 2, 2004 and (90) Taiwan-Finance-Securities (I) 143348 on July 16, 2001.

• 58 -

• Note 12: Approved by the Securities and Exchange Commission, Ministry of Finance as per letters with Ref. No. (90) Taiwan-Finance-Securities (I) 143348 on July 16, 2001 and Taiwan-Finance-Securities (I) 0930128437 on June 28, 2004.

• Note 13: Approved by the Securities and Exchange Commission, Ministry of Finance as per letters with Ref. No. (90) Taiwan-Finance-Securities (I) 143348 on July 16, 2001 and Taiwan-Finance-Securities (I) 0910132478 on June 14, 2002.

• Note 14: Approved by the Financial Supervisory Commission, Executive Yuan as per letter with Ref. No. Financial-Supervisory-Securities(I) 0940122455 on June 3, 2005.

• Note 15: Approved by the Securities and Exchange Commission, Ministry of Finance as per letters with Ref. No. (90) Taiwan-Finance-Securities (I) 143348 on July 16, 2001, Taiwan-Finance-Securities (I) 0910132478 on June 14, 2002, and Taiwan-Finance-Securities (I) 0920127281 on June 19, 2003.

• Note 16: Approved by the Financial Supervisory Commission, Executive Yuan as per letter with Ref. No. Financial-Supervisory-Securities (I) 0950122451 on June 2, 2006.

• Note 17: Approved by the Financial Supervisory Commission, Executive Yuan as per letter with Ref. No. Financial-Supervisory-Securities (I) 0960030405 on June 14, 2007.

• Note 18: Approved by the Financial Supervisory Commission, Executive Yuan as per letter with Ref. No. Financial-Supervisory-Securities (I) 0970031743 on June 25, 2008.

• Note 19: Approved by the Financial Supervisory Commission, Executive Yuan as per letter with Ref. No. Financial-Supervisory-SecuritiesCorporate-0980027677 on June 5, 2009.

• Note 20: Approved by the Financial Supervisory Commission, Executive Yuan as per letter with Ref. No. Financial-Supervisory-SecuritiesCorporate-0990029749 on June 9, 2010.

• Note 21: Approved by the Financial Supervisory Commission, Executive Yuan as per letter with Ref. No. Financial-Supervisory-SecuritiesCorporate-1000028222 dated June 20, 2011.

• Note 22: Approved by the Financial Supervisory Commission as per letter with Ref. No. Financial-Supervisory-Securities-Corporate-1030012130 dated April 17, 2014.

• Note 23: Approved by the Financial Supervisory Commission as per letter with Ref. No. Financial-Supervisory-Securities-Corporate-1010042558 dated September 17, 2012.

• Note 24: Approved by the Financial Supervisory Commission as per letter with Ref. No. Financial-Supervisory-Securities-Corporate-1050024281 dated June 27, 2016.

• Note 25: Approved by the Financial Supervisory Commission per letter Ref. No. Financial-Supervisory-Securities-Corporate-1040036382 of September 7, 2015.

• Note 26: Approved by the Financial Supervisory Commission per letter Ref. No. Financial-Supervisory-Securities-Corporate-1040036382 of September 7, 2015. (Change of capital not yet processed)

	Unit: shares,April 11,2022	Unit: shares,April 11,2022	Unit: shares,April 11,2022	Unit: shares,April 11,2022
Type of shares	Authorized capital			Remark
	Outstanding shares (TWSE listed)	Unissued shares	Total
Common shares	422,487,037	77,512,963	500,000,000	30,000,000 shares were reserved for employeepurchase of stock options.

Information on the shelf registration system: None.

(II) Shareholder structure

April 11, 2022

						April 11, 2022
Shareholder structure Quantity	Government agencies	Financial institutions	Other corporate entities	Individuals	Foreign institutions and individuals	Total
Number of people	5	37	52	7,720	494	8,308
Number of shares held	4,497,000	24,499,884	18,197,395	87,768,670	287,524,088	422,487,037
Shareholding percentage	1.06%	5.80%	4.31%	20.77%	68.06%	100.00%

• 59 -

(III) Distribution of equity ownership

1. Common shares

1. Common shares
			April 11,2022
Shareholding range	Number of shareholders	Number of shares held	Shareholding percentage
1 to 999	4,054	685,962	0.16%
1,000 to 5,000	3,114	5,727,462	1.36%
5,001 to 10,000	316	2,360,039	0.56%
10,001 to 15,000	148	1,846,622	0.44%
15,001 to 20,000	77	1,378,749	0.33%
20,001 to 30,000	90	2,197,258	0.52%
30,001 to 40,000	48	1,646,846	0.39%
40,001 to 50,000	37	1,713,076	0.41%
50,001 to 100,000	104	7,718,217	1.83%
100,001 to 200,000	97	14,127,100	3.34%
200,001 to 400,000	59	16,895,872	4.00%
400,001 to 600,000	32	15,069,885	3.57%
600,001 to 800,000	23	15,972,004	3.78%
800,001 to 1,000,000	17	15,035,686	3.56%
1,000,001 or above	92	320,112,259	75.77%
Total	8,308	422,487,037	100.00%

2. Preferred shares: None.

(IV) List of major shareholders

Name, number of shares held, and shareholding percentage of shareholders who hold more than 5% of the shares or the 10 largest shareholders:

(IV) List of major shareholders Name, number of shares held, and shareholding percentage of shareholders who hold more than 5% of the shares or the 10 largest shareholders:	(IV) List of major shareholders Name, number of shares held, and shareholding percentage of shareholders who hold more than 5% of the shares or the 10 largest shareholders:	(IV) List of major shareholders Name, number of shares held, and shareholding percentage of shareholders who hold more than 5% of the shares or the 10 largest shareholders:
April 11,2022
Shares Name of major shareholder	Number of shares held	Shareholding percentage
Leo Huang	20,859,897	4.94%
Chun-Sheng Chen	15,113,308	3.58%
JPMorgan Chase Bank N.A., Taipei Branch in custody for Stichting Depositary APG Emerging Markets Equity Pool	14,256,000	3.37%
JPMorgan Chase Bank N.A., Taipei Branch in custody for Schroder International Selection Fund - Asian Absolute Return	13,460,000	3.19%
Yu-Mei Hsueh	11,074,646	2.62%
First State Asia Pacific Leaders fund a sub fund of First State Investment	9,459,000	2.24%
Shu-Chuan Chen	9,294,362	2.20%
JPMorgan Chase Bank N.A., Taipei Branch in custody for Schroder International Selection Fund-Global Climate Change Equity	9,164,000	2.17%
Nan Shan Life Insurance Co., Ltd	8,662,000	2.05%
BNP Paribas Funds' Green Tiger under the custodianship of HSBC	5,703,000	1.35%

• 60 -

• (V) Prices, net asset value per share (NAVPS), earnings per share (EPS), and dividends per share (DPS), and related information of the 2 most recent years.

Item	Year	Year	2020	2021	2022 up to March 31
Market price per share	Highest		186.50	230.00	238.00
	Lowest		95.00	161.00	169.00
	Average		149.28	194.17	204.68
Net worth per share	Before distribution		38.29	44.07	-
	Afterdistribution		33.77	37.00	-
Earnings per share (EPS)	Weighted average number of shares		417,761,066	419,789,625	-
	Earnings per share (EPS)		5.56	9.96	-
Dividend per share (DPS)	Cashdividend		4.49960510	7.0 (Note)	-
	Stock divide nds	Stock dividends from earnings	-	-	-
		Stock dividends from capital surplus	-	-	-
	Cumulative unpaid dividends		-	-	-
Analysis of return on investment	Price to earningsratio		26.85	19.49	-
	Price to dividendsratio		33.17	27.74	-
	Cash dividend yield		3.01	3.61	-

Note: The 2021 earning distribution proposal was approved by the Board of Directors on February 23, 2022. The total cash dividend was NT$2,970,000,000. If an employee’s exercise of stock options or other reasons affect the number of outstanding shares or the shareholder dividend rate, and result in any change, the Chairperson is authorized to handle it with full authority.

• (VI) Dividend policy of the Company and its implementation

• Dividend policy stipulated within the Articles of Incorporation

  • Where the annual accounting close indicates a surplus, the said surplus shall be first used to pay taxes and cumulated losses (dues), and shall then set aside 10% of the said surplus as legal reserve. Where such legal reserve amounts to the total authorized capital, this provision shall not apply. The Company may review business requirements or refer to statutory regulations to set aside or reverse the surplus as special reserves. Any remaining surplus shall then be combined with the cumulated undistributed earnings of the previous year and the Board of Directors shall formulate a plan for distributing the earnings. The plan shall then be provided to the Shareholders’ Meeting to resolve on the distribution of this sum. Share dividends and bonuses shall not be allotted if the Company has no surplus.

The Board is authorized to make a special resolution to distribute and report to the Shareholders’ Meeting if the distribution of earnings as mentioned in the preceding paragraph shall be in the form of cash dividends.

When the Company has no loss, it may distribute new shares or cash out of the statutory surplus reserve and all or part of the capital surplus that meets the requirements of the Company Act, to the extent of 25% of the excess of the statutory surplus reserve over the paid-in capital.

Subject to the provisions of the preceding paragraph, the Board of Directors shall be authorized, by special resolution, to distribute cash out of the statutory surplus reserve and the whole or part of the capital surplus which complies with the requirements of the Company Act, and to report such distribution at the next shareholders’ meeting.

Dividend payout shall be implemented according to the business condition of the Company and consider both future capital budgets and capital requirements of future development plans of the Company as well as the shareholders’ interests. The Board of

• 61 -

Directors shall formulate the category and sum of dividend payout which shall, by principle, be no less than 60% of the net income after tax (NIAT) of the year. The Company’s 2021 and 2020 dividend distribution rates were approximately 71% and 81%, respectively.

Since the Company is still in the growing phase, capital requirements of future development plans of the Company shall be considered. Cash dividend distributed each year shall be no less than 20% of the total cash and stock dividends distributed for the year.

1. Dividend payout plans proposed during the most recent Shareholders’ Meeting According to Article 34-1 of the Company’s Articles of Association, the earning distribution proposal is based on cash dividends, and the Board of Directors is authorized to distribute by a special resolution and report to the Shareholders’ Meeting. The Company’s 2021 earnings distribution proposal was approved by the Board of Directors on February 23, 2022, to distribute shareholders cash dividends of NT$2,970,000,000, with a distribution of about NT$7 per share. This distribution plan will be reported to the 2022 regular meeting of shareholders and the Board of Directors will decide the base date for the distribution.

If the provision of employee stock options or any other reasons affects the number of outstanding shares, thereby leading to changes in the dividend payout ratio, it is proposed that the Board of Directors fully authorizes the Chairman to handle the relevant issue.

• (VII) Impact of stock dividends proposed by the Shareholders' Meeting on the Company's business performance and earnings per share (EPS): Not applicable.

• (VIII) Rewards for employees and directors

• Percentage or range of employee rewards and directors' rewards as stipulated in the Company's Articles of Incorporation.

• If the Company records a profit, 5% to 20% of the said profit shall be set aside for employee rewards. The Board of Directors shall determine whether to issue rewards in the form of stocks or cash. Recipients of the said rewards shall include employees at the Company who satisfy specific criteria. The Company permits the Board of Directors to set aside no more than 1.5% of the aforementioned profit as directors' rewards. Proposals for the distribution of employee rewards as well as directors' rewards shall be submitted to the Shareholders’ Meeting.

• Accounting treatment for the basis of estimating the amount of employee rewards and directors’ rewards, the basis of calculating the number of shares to be distributed as employee rewards, and for any discrepancy between the actual amount distributed and the estimated figures.

• (1) The possible amount is estimated based on the Company’s Articles of Association and past experience. The estimated amounts of 2021 employees’ compensation and directors compensation are NT$415,047,000 and NT$9,600,000, respectively. It is estimated at 7.73% and 0.18% of the profit before tax (amount before deduction of compensation for employees and directors), which is in line with the figures set in the articles of association.

• (2) Number of shares issued for employees’ compensation: 0.

• (3) Accounting treatment for any discrepancy between the actual amount distributed and the estimated figures: Where the Board of Directors resolves to enact major changes to the sum issued before the approval and issuance of the financial report, the said change shall be adjusted as annual expenses listed for the year. Where changes were still made to the said sum after approval and issuance of the financial report, the changes shall be treated as changes to accounting estimates, and be adjusted and entered into account for the following year.

• Status of compensation distribution as approved by the Board of Directors

• (1) Where the value of the employee rewards as well as directors' rewards distributed

• 62 -

in the form of cash or shares exhibit discrepancies with the recognized expenses and annual estimates, the sum, cause, and treatment of such discrepancies shall be disclosed:

  - On February 23, 2022, the Company’s Board of Directors approved a cash distribution of NT$415,047,000 for employees’ compensation and NT$9,600,000 for directors’ compensation, which is the same as the estimated annual amount of recognized expenses.

• (2) Sum of employees’ compensation provided in distributed shares and its proportion of the net income after tax (NIAT) provided in the parent company only financial report and the total sum of employees’ compensation: 0.

• If there is any discrepancy between the actual amount of rewards distributed to employees and directors (including the number and dollar amount of shares distributed, as well as share price) and the recognized amount of rewards for employees and directors in the previous fiscal year, the amount, causes and treatment of such discrepancies shall be stated:

• The Company’s FY2020 employees cash bonus was NT$383,845,000 and directors compensation was NT$9,600,000. There was no difference between the actual distribution amount and the recognized amount.

(IX) Repurchase of the Company's own shares: None.

II. Corporate Bonds: None.

III. Preferred shares: None.

• Ⅳ. Overseas depositary receipt: None.

• 63 -

V. Employee stock warrant

• (I) Status of employee stock options of the Company that are yet to mature: None.

• (II) Name and subscription status of managerial officers who have obtained employee stock options and employees ranked in the top 10 employees with the highest number of shares to which they have subscription rights through employee stock options acquired, up to the publication date of this annual report March 24, 2022

	of this an	nual report							March 24, 2022	March 24, 2022	March 24, 2022	March 24, 2022
	Position title (Note 1)	Name	Number of subscribed shares (In thousands of shares)	Proportion of subscribed shares acquired of total issued and outstanding shares (%) (Note 2)	Exercised				Unexercised
					Number of subscribed shares (thousand shares)	Price of subscribed shares (NT$)	Total value of subscribed shares (thousand NT$)	Ratio of subscriptions executed to the total shares issued (%) (Note2)	Quantity of unsubscribed shares (thousand shares)	Price of unsubscribed shares (NT$)	Total value of unsubscribed shares (thousand NT$)	Ratio of outstanding shares to the total shares issued (%) (Note2)
Managerial Officer	None	None	-	-	-	-	-	-	-	-	-	-
Employees (Note 3)	Employee	Kuo-Wei, Huang	770	0.1825	770	57.3~ 63.4	46,549	0.1825	0	0	0	0
	Employee	Chouyu Chuang
	Employee	Nick Wu
	Employee	Kevin Weng
	Employee	Hsin-I Wu
	Employee	Chun-Kuo Chen
	Employee	Hans Yi
	Employee	Mark Chien
	Employee	James Lee
	Employee	Yu-wen Hsieh
	Employee	Ming-Ying Tsou
	Employee	John Lee
	Employee	Liwei Liu
	Employee	Hsiang-Wen Shih
	Employee	Kuo-Cheng Wang
	Employee	Chien-I Cheng
	Employee	Chih-Wen Tsou
	Employee	Sheng-Kai Cheng
	Employee	Wen-Chung Chen

• 64 -

The Company's 2015 employee stock options expired on March 24, 2022.

• Note 1: It includes managerial officers and employees (special notes shall be provided for those who have resigned or deceased). Individual names and job positions shall be displayed. A summary sheet may be used to disclose the means of acquisition and subscription.

Note 2: The total number of shares issued refers to the number of shares listed in the Ministry of Economic Affairs' change registration data. (On January 7, 2022, the number of shares listed in the Ministry of Economic Affairs' change registration data is 421,874,537 shares)

• Note 3: Refers to a non-managerial employee in the top-10 employees for the number of stock subscriptions acquired.

VI. New employee restricted stocks

(I)New employee restricted stocks that have not yet reached all vesting conditions: None. (II)Name of managerial officers and top 10 employees with the highest number of new employee restricted stocks, and status of acquisition December 31, 2021

									December 31, 2021	December 31, 2021	December 31, 2021	December 31, 2021
	Position title (Note 1)	Name	New employee restricte d stocks acquired (shares)	Ratio of new employee restricted stocks to the total shares issued (Note 3)		Restricted rights released			Restricted rights unreleased
					Number of new employee restricted stocks shares (shares)	Issue Price (NT$)	Issue Amounts (NT$)	Ratio of new employee restricted stocks lifted to the total shares issued (Note 3)	Restricted rights unreleased Number of shares (shares)	Issue Price (NT$)	Issue Amount (NT$)	Ratio of new employee restricted stocks lifted to total shares issued (Note 3)
Managerial Officer	None	None	-	-	-	-	-	-	-	-	-	-
Employees (Note 2)	Employee	Zhi-Xiang Xu (Note 1)	185,000	0.0439%	135,750	10	1,357,500	0.0322%	0	0	0	0
	Employee	Yu-Zho Chen
	Employee	Jia-Chen Lin
	Employee	Zhi-Qing Zhong
	Employee	Bo-Yi Huang (Note 1)
	Employee	Yu-Quan Huang
	Employee	Wen-Yue Zhuang
	Employee	You-Qing Zhang
	Employee	Zhi-Shi Cai
	Employee	Shi-Chao Lin
	Employee	Cai-De Liao
	Employee	Chien-Liang Lin
	Employee	Ming-Chong Qiu (Note 1)

The Company's new employee restricted stocks expired on June 21, 2021

Note 1: Includes managerial officers and employees (special notes shall be provided to those who have resigned or deceased). Individual names and job positions shall be displayed. A summary sheet may be used to disclose the means of receiving an allocation or subscription.

• 65 -

Zhi-Xiang Xu resigned on January 31, 2019; Bo-Yi Huang resigned on August 4, 2020; Ming-Chong Qiu resigned on April 30, 2019.

• Note 2: Refers to a non-managerial employee in the top-10 employees for new employee restricted stocks

• Note 3: The total number of shares issued refers to the number of shares listed in the Ministry of Economic Affairs' change registration data. (On January 7, 2022, the number of shares listed in the Ministry of Economic Affairs' change registration data is 421,874,537 shares)

• VII. Issuance of new shares in connection with the merger or acquisition of other companies: None.

VIII. Implementation of capital utilization plan: None.

• 66 -

Chapter 5 Operation summary

I. Business content

• (I) Scope of business

• Major contents of the businesses engaged in

The Company and its subsidiaries mainly engage in the design, assembly, manufacturing, trading, repair, maintenance, calibration, and distribution of computer and peripheral equipment hardware and software, computer-automated test systems, electronic test equipment, signal generators, power supplies, and communication power supply equipment; trading of special materials; and the design, manufacture, and installation of automated equipment. The Company's current product lines include: 1. Test instrument equipment; 2. special materials; 3. automated equipment.

1. Proportion of various businesses

Consolidated revenue:

equipment; 2. special materials; 3. automated equipment. 2. Proportion of various businesses Consolidated revenue:	equipment; 2. special materials; 3. automated equipment. 2. Proportion of various businesses Consolidated revenue:	equipment; 2. special materials; 3. automated equipment. 2. Proportion of various businesses Consolidated revenue:	equipment; 2. special materials; 3. automated equipment. 2. Proportion of various businesses Consolidated revenue:	equipment; 2. special materials; 3. automated equipment. 2. Proportion of various businesses Consolidated revenue:
Unit: In thousands of NT$
Year Product category	2020		2021
	Amount	Proportion of revenue (%)	Amount	Proportion of revenue (%)
Testinstrument equipment	12,045,049	77.55	13,555,365	77.09
Special material	2,551,127	16.42	2,804,306	15.95
Automated equipment	617,812	3.98	780,206	4.44
Others	318,555	2.05	444,146	2.52
Total net operatingrevenue	15,532,543	100.00	17,584,023	100.00

1. Current products of the Company

2. Power electronics test solutions

   1. DC electric load

   2. AC electric load

   3. Regenerative AC load

   4. AC power source

   5. DC power source

   6. Digital power meter

   7. Switching power supply ATS

   8. Battery simulator

   9. Chroma Soft panel

3. Electric vehicle test solutions

   1. Automated test system for power electronic components

   2. Battery simulator

   3. Battery test system

   4. Electric propulsion system

   5. DC power source

   6. Electronic load

   7. Motor test

   8. Automated transformer test system/automatic component analyzer

4. Battery test and automation solution

   1. Battery pack/battery module ATS

   2. Battery testing and formation system

   3. Battery pack manufacture test solution

   4. Battery pack after service test system

   5. Electrical safety test solution

   6. Automated optical inspection system

5. Passive component test solutions

6. 67 -

7. LCR meter/auto transformer test system

8. Electrolytic capacitor tester

9. High-frequency AC tester

10. Component test scanner

11. Insulation tester

12. Milliohm tester

13. Passive component ATS

14. Electrical safety test solution

15. Partial discharge tester

16. Lead-acid battery cell tester

17. Electrical safety test solution

18. High potential tester/safety tester

19. Ground bond tester

20. Electrical safety test scanner

21. Impulse winding tester

22. Calibrator

23. Automated test system

24. Motor test solution

25. Video and color test solutions

26. Video signal image generator

27. Color analyzer

28. Automated test system

29. PCBA image analyzer

30. Signal module

31. Flat panel display test solutions

32. Flat panel display tester

33. OLED test system

34. SHV 8K test solution

35. LED & driver test solution

36. LED total power test system

37. ESD test system

38. LED power source test solution

39. Cooling chip controller

40. Temperature recorder

41. Photonics Test Solution

42. Wafer-level testing

43. Packaging level testing

44. Automated optical inspection solutions

45. Automated optical test system

46. Solar cell AOI system

47. Photovoltaic/inverter test & automation solutions

48. 1.Automated optical test system

49. 2.Thermoelectric cooling chip controller

50. 3.Thermal data logger

51. PV inverter test solution

52. Semiconductor/IC test solutions

53. SoC test system

54. VLSI test system

55. IC test handler

56. Metrology system

57. RF and wireless measurement and test solutions

58. 68 -

     1. Wireless test solutions
    
     2. RF recorder/player
    
     3. GPS simulator
    

    • PXI test & measurement solutions

      1. PXI SMU/power supply instrument

      2. PXI semiconductor/IC test system

      3. High-precision power measurement unit

    • Smart manufacturing system solutions

      1. Intelligent manufacturing system

    • Turnkey test & automation solution

      1. Production line automation assembly and testing

    • Other solutions

      1. Reliability test solution

    • Universal test solution

59. New products under development

    • Ultra high resolution Video Generator for Gaming Testing

    • High performance Battery cell series charge Formation System

    • Laboratory-level high-precision vehicle power battery test system

    • Research in Characteristics measurement and defect detection of energy storage components

    • High performance Electrical Motor Emulator

    • Dual axle Dynamometer

    • Next Generation Power HIL Testbed for EV Key components Testing Power HIL Testbed for EV key-component testing

    • Energy recycling battery module charge and discharge tester-direction charger for battery module/Pack testing

    • Energy Recycling and high power density DC Load

    • Energy Recycling and high power density DC Load

    • 1U 3-channels high power density DC Source Next generation bi-direction and high power density DC Source

    • Bi-directional high power density DC Source Next generation bi-direction and high power density DC Source

60. (II) State of the industry

61. Current state and development of the industry

In 2021, the COVID 19 epidemic and the spread of the variant virus Delta continued from the previous year, and under the epidemic control system of various countries, the shortage of labor and materials impacted the world economy, and therefore the semiconductor industry is regarded as an important economic and political driver of various countries, and various semiconductor investment incentives and subsidies were launched, thus driving the booming development of the overall semiconductor equipment industry. The booming development of automation and electric vehicles has led to strong demand for testing of related components, which has also boosted the demand for power electronics test equipment.

• Power electronics test solutions

Power supplies represent a basic and core component of electronic equipment, and are widely utilized in various electronic products such as PC, servers, rechargers, displays, and industrial power supplies.

In 2021, the EV electronic components and battery charging station industries flourished. The automotive electronics industry focuses on safety and tolerance and implements strict quality requirements. Therefore, its demand for test equipment is

• 69 -

more complex and extensive. Improving the quality and speed of testing is the key issue for the development of the test instrument industry. The Company and its subsidiaries' development of power supply test equipment and test automation addresses complex and multi-tasking test requirements. Following the production automation trend, the Company has also developed its own power supply automated test system, which features a powerful software platform and a wide selection of test items for various industrial test applications, thus maintaining this product line’s competitive advantage.

• Video and color test solutions The display market’s continued development towards high-resolution has resulted in the production of 8K SHV (Super HI-Vision) high-resolution displays. With the introduction of these high-resolution applications, the video interface has also improved. For example, the HDMI 2.1 specification has introduced a single HDMI signal capable of transmitting 8K video signal images. As for video and color test solutions, the display panel industry has developed 8K Super-Hi Vision test solutions to meet the needs of 8K SHV resolution (7680x4320 / 8192 x 4320) testing. In the meantime, a modular architecture design must be adopted so that the solution can be combined flexibly with different signals or power modules and required test conditions. High flexibility, strong scalability, and the ability to support a variety of mainstream industry communication interfaces enable this solution to stay in line with industry developments.

• Test solutions for passive components and regulatory testing In 2021, the epidemic continued to catalyze remote business opportunities and stimulate the continued growth of the information electronics industry, boosting the demand for passive components. Passive component manufacturers expande their production capacity to boost market demand. Therefore, we provided new automated testing technology for passive components and safety standard testing. Multiple testers are consolidated into one. Verifying that power semiconductor components can operate under normal conditions without continuous partial discharge is the key test item that ensures long-term working quality.

• Semiconductor/IC test solutions

• In 2021, with the increase of 5G smartphone penetration and the expansion of the electric vehicle market, the semiconductor market size increased greatly and the shortage of materials remained unresolved throughout the year. This prompted manufacturers to invest in plant expansion, resulting in a significant increase in equipment demand. Therefore, we developed a variety of test programs that can carry out parallel tests that will increase the amount of output per unit of time, which is a trend in test equipment manufacturer R&D. Customized test equipment capable of satisfying specific requirements may be directly utilized to replace the generalpurpose testers, achieving a significant reduction in costs.

• Battery test and automation solution With the changes caused by the epidemic in 2021, the global battery industry highlighted the urgency of the energy demand. Additionally spurred by the carbon reduction issue raised at the climate summit, global new energy industries such as the electric vehicle and battery industries attracted investments in development and therefore flourished. The resulting increase in demand for batteries has in turn raised the importance of battery safety. The Company has long been committed to the new energy field and has been working hard on automation and efficiency of battery testing, providing customers with testing and certification services for power cell, module, battery pack and battery system performance, as well as environmental reliability and safety testing. The evolution of electric vehicles depends on the advancement of battery functions. With battery reliability becoming increasingly

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important, the stability of the battery quality not only affects the EV’s endurance but also its safety. Hence, automated battery testing is an important part of the current development of electric vehicles.

1. Correlation between upstream, midstream, and downstream sections of the industry

2. A. Measurement instruments and equipment

   • These instruments and equipment belong to the test instrument sector in the information electronics industry. The Company primarily purchases parts and components from upstream suppliers, and assembles them to produce the test instruments and equipment, which are marketed and sold to customers under the Company’s brand name. The Company and its subsidiaries offer an extensive selection of solutions for product testing and validation purposes to customers from many fields such as video surveillance, passive components, LCD modules, LED, semiconductor, photovoltaics (PV), and electric vehicle industries.

The following diagram describes the relationship between the upstream, midstream, and downstream sectors in this industry:

Upstream Boxes and cases Printed circuit Boards (PCB) IC Other components	Midstream		Downstream
Boxes and cases Printed circuit Boards (PCB) IC Other components	Assembly Testing Sales		Video surveillance, power supply, passive components., IC design, IC testing, LED, PV and solar power cells, and electric vehicles industries

• B. Special materials

• The main products in the special materials business are gold wires, copper wires, and lead-free solder balls. Gold and copper wires are bonding wires used in the process of bonding semiconductor packaging wires. The primary business engaged by the Company’s subsidiary, Chroma New Materials Corp., is the trading of special materials, and the downstream industry is the IC packaging industry.

• C. Automated equipment

• With the combination of metrology equipment, automation systems, and MES software capabilities to provide customers with automation solutions (Turnkey Solution). The various main products of MAS, a subsidiary corporation, are photovoltaic (PV) automated production and system integration, TFT-LCD automated production and system integration, battery module ATS and cleanroom equipment planning and system integration.

• Development trends and competition for various products

• A. Development trends of various products

• Power electronics testing industry

  • The following describes the current product development trends for power supply test solutions in response to the aforementioned production, R&D, and quality requirements:

  • Low voltage load characteristics and high current switching technology in response to the point-of-load converter power supply and fast switching properties.

  • Input distortion simulations and electrical grid distortion simulations in response to regulatory requirements for testing of power supplies.

  • Discontinuous, low power measurements in response to energy-saving requirements of power supplies under standby mode.

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• DC power supplies covering high voltage and current levels are able to reduce the required number of DC power supplies with DC/DC converter input, thus reducing testing costs.

• High voltage, high frequency testing technology, and low parasitic capacitance testing jigs for LCD Inverter testing can greatly improve testing speed and stability.

• Network data capture functions enable manufacturers to establish real-time production capacity controls and perform statistical quality control.

• Video testing industry

• The display industry develops towards high resolution, officially entering the 8K era with 8K (Super-Hi Vision) ultra-high-definition resolution images. The application drives the improvement of the video interface and USB TYPE-C integration for image transmission, bidirectional power supply, and data transmission functions, with lightness and uni-directional convenience. The Video Electronics Association of America (VESA) has defined the Embedded Display Port video interface, widely used because of its high bandwidth and low system power consumption. Therefore, the corresponding test specifications are also the focus of industry development. Product development adopts modular architecture design which can pair up with different signals or power modules, offers freely customizable test conditions as required, high elasticity, strong expandability, and supports multiple mainstream industry communication interfaces. Thus we provide the display panel industry with 8K ultra-high-definition resolution (7680x4320/8192x4320) test solutions to meet the needs of today's and future video industry applications.

• Passive components. testing

• Electronic products are becoming lighter, thinner, and smaller. As a result, the manufacturing, R&D, and quality of passive components within these products also focuses on high efficiency and precision. The trends in development of testing equipment for passive components can be described as follows:

• High speed precision measurement, integrating equipment automation to improve production efficiency while reducing human mistakes to enhance reliability.

• Integrated testing of multiple parameters to reduce production equipment and decrease the number of labor hours required, thereby lowering production costs.

• Providing comprehensive test solutions for specific applications that help users to set up systems quickly, meet their test requirements and receive comprehensive technical support.

• Providing network data capture functions so that manufacturers can establish realtime production capacity controls and perform statistical quality analysis.

• Electric vehicle/battery test equipment

• The most important components of mobile devices and electric vehicles are battery modules. The reliability of battery modules is closely related to safety concerns, making battery reliability testing an essential part of production. Battery production can be extremely energy-consuming, which is why development of energy-saving, efficient, stable and safe automated equipment has become an important trend in this industry.

• Semiconductor/IC test solutions

Since 5G, smart manufacturing, autonomous vehicles, and HPC applications are increasing, the semiconductor industry is becoming more and more important. Especially the development of high-precision testing is a key issue in semiconductor development, and the combination of integrated test instruments

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and automation has become the focus of competition in the industry. To respond to this trend, the Company and its subsidiaries have been actively integrating combined technologies in multiple fields such as electronics, electrical machinery, software, information, and communications. We provide a full range of test solutions for different semiconductor products in the production and manufacturing process, including semiconductor material nanoparticle monitoring, multimedia wafer testing, PXIe test platforms, RF radio frequency wafer testing, and other 5G solutions.

• Photonics test solutions

Since Apple amazed the technology community by incorporating facial recognition technology into iPhone X, its key laser diode has become an important element for 3D sensing. This technology has recently become widely used, especially in face recognition, autonomous vehicles and fiber-optic communications. With the increase in demand for laser diodes, the quality and reliability of laser diodes becomes important, and the need for various related test instruments is increasing. Photonics test solutions mainly comprise the chip sector of the laser diode and the packaging sector of the optical communication active component.

• B. Product competition

As the Company and its subsidiaries have been actively involved in the test instrument and automation industry for many years, its barriers to entry in terms of product technology are very high, and each product can maintain its technologically leading position. However, as new products continue to be introduced and the Company has to maintain its competitiveness, we continue to expand our product base and technical capability, collaborate with tier-one manufacturers, improve our R&D and invest in companies with unique testing technology. In addition, with rampant counterfeiting in other regions brought along by the relocation of industries in recent years, products of the Company and its subsidiaries also suffer from price competition involving counterfeit products. Hence, in order to maintain the competitive advantage of its products, the Company and its subsidiaries invested a considerable amount of manpower to apply for patents and safeguard our brand value. As production processes become increasingly automated, integrated testers and automated equipment will provide instrumentation industries with high levels of competitive advantage.

• (III) Technologies and recent R&D efforts

• R&D expenses invested in the two most recent years

competitive advantage. chnologies and recent R&D efforts &D expenses invested in the two most recent years
	Unit: In	thousands of NT$ 2021 1,511,465 17,584,023 9%
Item\Year	2020	2021
R&D expenses	1,341,956	1,511,465
Net operating revenue	15,532,543	17,584,023
Proportion of R&D expenses to net operating revenue	9%	9%

1. Major R&D outcomes

2. ◎2238 Video Pattern Generator

3. ◎2918 Flat Panel Display Test Solution

4. ◎7505-05 Multi-Functional Optical Measuring System

5. ◎61509 Programmable AC Source

6. ◎63000 Programmable DC Load

7. ◎62000L Programmable DC

8. ◎66205 Digital Power Meter

9. ◎1870D Inductor Test & Packing Machine

10. ◎1871 Inductor Layer Short Automatic Test System

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◎11210 Battery Cell Insulation Tester

◎11050 HF LCR meter

◎19501-K Partial Discharge Tester ◎19311 Battery Cell Surge Tester

◎33010 PXIe PE Card

◎3680 Advanced SoC Test System

◎3160-C Tri-Temp Quad-Site Handler

◎3660-C Tri-Temp System Board Handler

◎7940 Wafer Chip Inspection System

◎58620 Laser Diode Characterization System

◎58604 Laser Diode Burn-in and Reliability Test System

◎7505-K006 Cylindrical Battery Cell Automated Optical Inspection System

◎7505-K007 Thin Film Thickness Automated Optical Metrology System

◎3730-E Solar Cell Sorting System

◎3760 Solar Cell Inspection Test/Sorting System

◎17011 Battery Charge and Discharge Test System

◎17040 Regenerative Battery Pack Test System

◎7925 TO-CAN Inspection System

◎8000 Power Supply ATS

1. Future R&D plans

After the sales of the semiconductor solution nanoparticle monitoring system to semiconductor fabs, the Company successfully entered the testing field of advanced manufacturing processes in semiconductor fabs. In mid-2019, the Company invested in the Israeli semiconductor test equipment company CAMTEK. Through the technical cooperation between the two parties and the integration of the Company’s optical, electromechanical, and temperature control measurement technologies, the Company will expand its test equipment in advanced semiconductor manufacturing processes. These will be the Company's research and development goals in the next few years. In recent years, the main development trends of the IT industry are toward 3D and a variety of 5G wireless transport equipment, entering the era of electric vehicles, unmanned vehicles, and smart cities. As the use of various power sources has become increasingly important, the Company continues to develop towards high-power power supplies.

Therefore, the Company's research and development plan has also evolved with various industries, promoting related automation equipment of Industry 4.0 and the development and integration of Turnkey Solution products, as well as establishing Industry 4.0 smart manufacturing related solutions. In response to the IoT trend, we are also developing electric vehicle-related equipment and test equipment, battery test equipment, wireless communication test equipment, as well as test equipment that meets VR and AR requirements. The Company and its subsidiaries are also committed to the R&D of products related to clean technology, with the aim of developing relevant automated 5G test equipment.

• (IV) Long-term and short-term business development plans

• Short-term development plans

  • (1) Actively and properly address the impact of labor and material shortages to meet customer needs

    • The U.S.-China trade war and the success of epidemic prevention have elevated the global status of Taiwan's electronics industry, and the increasing use of electronic products has led to a significant increase in demand. The crisis of material and labor shortage broke out in 2021 and has not been alleviated in 2022; this must be addressed to ensure the proper shipping of goods.

  • (2) Accelerate the development of advanced semiconductor manufacturing, HPC, 5G

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communications and other high-end semiconductor-related test solutions Investment in advanced semiconductor manufacturing equipment is increasing. Many equipment vendors vying for business, but the barrier to entry is very high, so the development of equipment in the semiconductor field has become an important plan for the Company's product development. HPC and 5G will also lead to large-scale applications in recent years, and the active development of related equipment has been an important development goal for the equipment industry in recent years.

• (3) Actively meet the needs of our 1st Tier customers for Test Turnkey Solutions.

• The 1st Tier customers are the pioneers of the industry technology, so we break through the technical bottleneck to meet the test quality requirements of customers, in order to promote the Company's technological advancement and expand our product market.

• Long-term development plans

• The long-term goal and vision of the Company is to “develop world-class products and become a world-class enterprise”. World-class products are "precise, reliable and unique", providing customers with valuable test solutions to various electronic technology industries, while world-class corporations advance toward the three major principles of "innovative technologies, private brands, and internationalization". Thus, the Company annually invests a significant sum in R&D and in companies with unique technologies, to ensure that the Company maintains its lead with its core technologies and highly integrated capabilities in optics, machinery, electronics, temperature control, and software, maintaining its competitive advantage and growth and thereby achieving the goal of sustainable development.

• (1) Marketing plans

• With the rise of work specialization at an international level, manufacturing bases for the IT industry have started expanding outward. In order to provide customers with services of the highest quality, the Company and its subsidiaries have also established a sales network composed of overseas subsidiaries, as well as sales agents and dealers. With Taiwanese companies heading to Southeast Asia for investment purposes in recent years, the Company has also formulated plans to set up sales and marketing locations in Southeast Asia through its subsidiary in Singapore. Furthmore, the parent company provides support to various activities, in hopes of increasing revenue in this region to sell to the whole world under its own brand name.

• (2) Human resource plans

• The Company and its subsidiaries have been developing niche products for its business development objectives and can thus be considered a highly technical business. Efforts have been invested to strengthen employee training and establish a knowledge management platform and learning database, sharing resources to help employees quickly gain competence in the professional and technological field, improve human resources, and reduce learning time. Regular performance appraisals and employee interviews are conducted to help employees develop their career and life appropriately and to steadily cultivate the human resource base.

• (3) Product development plans Innovation is the DNA of the Company. Innovative technology provides customers with higher added value and services to meet their needs. It is the Company’s product development strategy and is aligned with the development of the industry. In the future, in addition to investing in semiconductors, HPC and 5G communication industrial development-related test products, the Company will also invest in modular instruments, systematic integration, and various automated customized products. With the rising labor costs and aging population, intelligent networks, industrial automation, and health care industries are becoming increasingly important. The Company's long-term product development plans will therefore focus on the

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development of test equipment related to products in intelligent network systems in order to develop equipment related to industrial automation and health care. The Company will also be actively integrating the upstream and downstream industries, and utilize a merger and acquisition strategy to create opportunities for expanding relevant 5G product lines.

II. Market, production, and sales summary

• (I) Market analysis

• Major products by sales area

Area		2020	2020			Unit: In thousands of NT$ 2021	Unit: In thousands of NT$ 2021	Unit: In thousands of NT$ 2021
		Amount	% of	net operating revenue		Amount	% of	net operating revenue
Domestic sales Export sales Total		$ 4,339,259 11,193,284 $15,532,543		28% 72% 100%		$ 4,889,619 12,694,404 $17,584,023		28% 72% 100%

1. State of the market

2. The Covid-19 virus continued to spread worldwide in 2021, and work stoppages, city closures, and lockdowns were implemented from time to time around the world to prevent the virus from wreaking havoc. Governments continue to stimulate the economy with monetary easing and subsidies, leading to a booming demand for HPC, 5G communications, and electric vehicle applications in the information electronics industry, resulting in labor and material shortages. As a result, the equipment market has grown significantly, and countries have come to regard semiconductor production capacity as an important part of national development, in turn resulting in stronger demand for semiconductor equipment.

3. State and growth of market supply and demand

4. The shortage crisis in 2022 has not been alleviated yet. From the shortage of raw materials, which leads to price increase, to the shortage of electronic components, especially the shortage of semiconductors, and lead times of key components sometimes being than 40 weeks, these issues have all triggered the governments of various countries to regard the expansion of semiconductor production capacity as the lifeline of national economic and military development. Therefore, ensuring the adequate supply of raw materials and on-time delivery to customers is the biggest challenge for the industry's growth in 2022.

5. Positive and negative factors affecting competitive niches and long-term development, as well as response strategies

6. (A) Competitive niches and positive factors:

7. The Company has long invested in the research and development of critical technologies and products with unparalleled reliability. In the early stage, the Company cooperated with the world’s first-tier manufacturers to gain trust and experience so that the Company can keep abreast of industry trends and timely introduce new measurement equipment in response to the mass production requirements of the market. The Company has accumulated a variety of key technologies over the years and developed a number of technologically advanced products, allowing the Company and its subsidiaries to stay ahead in the test market. Competitive niches of the Company and its subsidiaries include effective control over sales channels and acquisition of the latest industry information. The business group has ample resources in the sectors of testing, automation, and factory management systems to provide customers with required Turnkey Solutions, providing the Company and its subsidiaries with various advantages to maintain

8. 76 -

market competitiveness.

• (B) Negative factors:

• Our test Instruments are typically produced in small amounts and wide varieties, making mass production difficult. Production processes are often complicated and difficult to manage. Other unfavorable factors include the complexity of test instruments, and a diverse range of material types required, which combined with the current crisis of shortage of parts makes immediate delivery to customers impossible, resulting in high warehousing costs.

• (C) Response strategies:

• Since products are offered in many models and required in small quantities, the Corporation and its subsidiaries adopted modular designs during product research and development (R&D) phases. Differences in specifications were concentrated in a single module during the production process. Shared characteristics and designs were adopted into general modules in order to improve production volume for general modules while reducing the materials required for the unique parts. Besides, in order to strengthen production and inventory management, the IMS BU and the Information Center at the Company and its subsidiaries have also built a complete information management system according to the nature of industries to which they belong, intending to enhance management efficiency.

In response to the material shortage crisis, the Company is actively seeking alternative materials for immediate delivery to meet customer demand.

• (II) Major uses and production process of primary products

• Major uses of the primary products

  • Power electronics test solutions

    • In addition to applications in information, communications, aerospace, defense, and other industries which rely on power electronics test solutions, under the pressure of the tightening of the earth’s resources in recent years, energy-saving products such as hybrid electric vehicles, LED lighting devices, solar energy, and fuel cells also use Chroma ATE's proficient technology in the field of power supply testing, introducing customized test solutions for the industry.

    • The Company provides a variety of test equipment for programmable AC power supply, programmable DC power source, DC electronic load, AC electronic load, digital power meter, and frequency-response analyzer, offering regulatory tests for both input and output terminals as well as satisfying the requirements of dynamic simulations. Soft panel (exclusive graphic operating software) and NI Labview drivers were also provided to help users conveniently employ these solutions. The Corporation and its subsidiaries independently developed an automated test system which includes a software platform that comes with powerful inbuilt functions and general tests which can then be integrated with the desired hardware instrument to independently edit the test items and to acquire and analyze vast amounts of test data. Analysis results could then be used as a basis for R&D or quality assurance (QA) to make changes to the product or improvements to factory processes. In addition to recent applications for PC/servo/telecom power sources, adapters, and chargers, other areas such as backlight inverters, LED drivers, ballast of energy-saving lamps, UPS, PV inverters, and even electric vehicle supply equipment (EVSE) were included within the scope of applications. The Company and its subsidiaries have a global technical applications support team, and can provide customized plans for automation systems as well as production of testing jigs.

  • Video and color test solutions

LCD modules are provided with different signal transformation panels. Once assembled, the final product can be adapted to different signal outputs in various products. These complex outputs and input interfaces require a video pattern generator

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which provides various international standard signal test screens for testing purposes to analyze the performance of the display in processing video signals. Precision is a key requirement since the output signals of the video pattern generator are the standard source.

Color analyzers employ advanced digital signal processors and photoelectric conversion technology, and combine them with precision optical components and circuit design to accurately measure the energy, calibrated color, brightness, and white balance of the light projected by the display to meet international standards and specifications.

For large-scale monitors and projectors, the optical color analysis probe can be used to achieve simultaneous measurements of multiple points. This can then be integrated with the video pattern generator as well as a software operation interface for video signal analysis. All programmed tests can be carried out quickly using single button operations, making it the most competitive video and color test solution available. - Test solutions for passive components and regulatory testing

Test equipment for passive components includes tests for capacitors, inductors, resistors, and other basic passives as well as tests conducted for various electronic components that were assembled using these components (such as wound components, communication and power source filters) or have similar properties (such as switches, connectors, conducting wires, metallic materials, dielectric materials, magnetic materials, and semiconductor components). Tests can be used to analyze the properties of the tested objects and provide design optimization for integrated applications such as automated production inspection, incoming/outgoing inspection, QA verification, and R&D analysis in order to satisfy the customer’s requirements for cost reduction and efficiency.

Electrical regulatory test equipment is widely employed for various types of electronic components, electrical products, or health care products. Major tests include AC/DC withstand voltage and insulation resistance testing for electronic components as well as ground bond and grounding leakage current tests for electrical products or medical electronics. In addition to verifying product compliance with various safety specifications such as those from UL (United States), CE (Europe), and TUV (Germany), the primary purpose of testing is to ensure personal safety of the users as well as long-term reliability of the products. To create an international sales channel, safety regulations must be regarded as a major topic.

Products to be tested include multi-functional calibrators, resistors, and capacitor meters. In addition to single-unit operations, these solutions can also be connected and used with other testers for R&D, design verification, and QA testing purposes. These test solutions are capable of fulfilling basic testing requirements of different units.

• Flat panel display test solutions

Liquid crystal module test solutions can adopt a shorting-bar signal during the assembly phase to test for various defects of the panel and implement laser correction. After module assembly, different panel dimensions and backlight sources (CCFL or LED BLU) are referenced before using video signal sources and programmable power sources together with an ergonomic operation interface on PC platforms to carry out voltage, current, and power testing. Both software and hardware are used to analyze image bright spots, defective spots, color, and resolution. Automated conveyor belt production line designs and system-based controls also provide integrated networkbased management functions for data analysis.

• Semiconductor/IC test solutions

The Company has established a strong foundation in the field of semiconductor wafer testing for many years, and thus has a large number of product lines. Equipment required from the R&D to mass production stages such as the ATE large-scale test

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system, IC sorter, and PXI/PXIe miniaturization test platform are all complete. Corresponding products provide customers with the most suitable choice. Semiconductor solutions cover different wafer test applications such as: consumer wafers (microprocessors, audio chips, peripherals for computers/mobile devices, etc.), power management chips (linear regulators, DC converters, AC converters, LEDs Drivers, etc.), RF chips (wireless networks, Bluetooth, mobile communications, etc.), and specific areas of testing (image sensors, radio frequency identification, etc.). Handlers used in backend production of ICs can work with different IC packaging types and sort out defective products from conforming ones. After IC packaging and testing, automated system function testers can be used to rapidly screen the completed IC packages, replacing simulated test environments with actual usage environments for product testing to provide low cost and high coverage tests that will greatly improve the quality of the delivered product.

• Solar cell test solutions

The solar cell test solutions focuse on the inspection needs of the solar cell and module process, and consists of various testing machines and inspection equipment. The I-V tester measures the conversion efficiency of the cells and differentiates them according to different conversion efficiencies, then determines the cell color and printing defects on the front and back sides through automatic optical inspection, and finally sorts them through the solar cell sorting machine. When assembling PV systems, system inverters would convert DC into AC currents while controlling the direction of current flow and calculate the reverse current delivered. AC/DC power supply and electronic load of Chroma ATE can be used to simulate and measure output power supply to ensure its quality.

• Battery test and automation solutions

• The Company's battery testing and automation solutions cover a wide range of products, including dynamic charge and discharge, regenerative battery module test systems for real-world current simulation applications, battery discharge energy recovery and reuse, power saving, environmental protection, and low thermal output. The goal is to reduce electricity, air conditioning and production costs. The applicable industry scope includes electric vehicle manufacturers, energy storage system vendors, and battery module plants, which are interested in battery management system testing, battery pack endurance testing, product shipment inspection, design verification research, battery pack production line capacity learning and DC internal group testing.

• Photonics Test Solution

• The photonics test solution mainly includes the chip sector of the laser diode and the packaging sector of the optical communication active component. Chroma's superior power electronics and optical measurement technology, coupled with structural integration and temperature control, the optical components can be burned at different ambient temperatures and tested. The semiconductor laser characteristic detection system is designed specifically for laser diodes, and the all-in-one design concept is used for automatic detection. It can be used for simultaneous testing of different test items; it can be used together with high-capacity vehicle designs. A large number of chips are used to perform various tests. In addition, AOI can increase the speed and reliability of automated inspections. The design of a highly stable temperature control platform enables the R&D engineers to accurately understand the relationship between laser semiconductor characteristics and temperature.

• Manufacturing execution system (MES)

• This solution provides an integrated system for collection of production information from manufacturing sites, and makes use of various automated electronic equipment to automatically collect on-site production information in real-time, using intelligent data collection and intelligent computing. It also integrates data required by processes

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in various units (such as material, production, manufacturing, quality control (QC), and warehousing) so that every unit can rapidly acquire the needed information and boost production efficiency.

2. Production process

==> picture [424 x 129] intentionally omitted <==

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

Material 插件(自動 Mounting 電路板後 Process
Material 材 料 processing 材料加工 (automatic) 插件) Reflow oven 過錫爐 Touch-Up 焊加工 inspection 製程檢驗
After burning assembly 燒機後組裝 Burning 燒 機 Prior burning 燒機前測試 test assembly Module 燒機前組裝 Inspection of Semi-finished product 半成品入庫前檢驗 Pre-warehouse PCB test 電路板測試
After burning 燒機後 Pre-warehouse 入庫前 Pre-warehouse 入庫前 Pre-delivery 出貨前
測試 test inspection 檢驗 packing 包裝 Warehousing 入 庫 inspection 檢驗 Delivery 出 貨
----- End of picture text -----

(III) Supply of raw materials

The Company and its subsidiaries manufacture a large variety of product types in small quantities. A large quantity of raw materials is required, including: programmable logic gate array IC, converter IC, memory, relays, structural materials, and PCB. The following describes the state of material supply:

Raw material category	Main supplier	State of supply
Programmable logic gate array IC	Galaxy Far East Corp., Weikeng, and Answer Technology	The Company maintains more than three suppliers, acting as agents for the products of world-renowned manufacturers, for long-term cooperation. Both quality and supply are stable.
Power converter IC	Answer Technology, Morrihan, Texas Instruments	The Company maintains more than three suppliers, acting as agents for the products of world-renowned manufacturers, for long-term cooperation. Both quality and supply are stable.
Memory IC	Weikeng, Transcend, and Arrow Electronics	The Company maintains more than three suppliers, acting as agents for the products of world-renowned manufacturers, for long-term cooperative. Both quality and supply are stable.
Relay	SUMCHIP, IC- Hi Technology, Bright Toward Industry	The Company maintains more than three suppliers, acting as agents for the products of world-renowned manufacturers, for long-term cooperative. Both quality and supply are stable.
Structural materials	Chyuan Jyh Industry Co., Ltd., GAO JING JHUN METAL CO. LTD., Chang Yang	It is supplied by more than three suppliers, and its manufacturing quality and supply are very stable. The company maintains a good long-term cooperation relationship.
PCB	SHIN PUU, SPEEDY CIRCUITS, TAI MOON ELECTRONICS	It is supplied by more than three suppliers, and its manufacturing quality and supply are very stable. The company maintains a good long-term cooperation relationship.
Gold wire and copper wire for IC	NIPPON	Primarily supplied by NIPPON, while the Company's subsidiary, Chroma New Material Corporation has ended its distributionbusiness on March31,2022.

Given the large variety of raw materials and components needed by the Company and its subsidiaries to manufacture precision instruments, all local and overseas purchases were

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handled by a single purchasing unit. Where possible, 2 or more suppliers were selected to ensure supplier replaceability, acquire competitive pricing, distribute purchasing risks, achieve reasonable cost reductions, and provide better services. The purchasing unit shall regularly review quotations offered by the supplier. QC and purchasing personnel shall conduct audits at the supplier end to ensure the stability of product quality while assessing the production capability of the supplier.

• (IV) List of suppliers and customers accounting for 10 percent or more of the Company’s total purchases (sales) of goods in either of the two most recent years, amount and percentage of total purchases (sales) of goods, and reason for changes in these figures.

• List of suppliers accounting for 10 percent or more of the Company's total purchases of goods in either of the two most recent years

Information on major suppliers in the two most recent years

Unit: In thousands of NT$

Item	2020	2020	2020	2020	2021	2021	2021	2021
	Name	Amount	Proportion to net purchases of goods for the entire year (%)	Relationship with the issuer	Name	Amount	Proportion to net purchases of goods for the entire year (%)	Relationship with the issuer
1	NMC (Japan)	1,662,467	21.07	None	NMC (Japan)	1,671,326	18.66	None
2	NMC (Philippines)	780,037	9.89	None	NMC (Philippines)	1,019,827	11.39	None
	Others	5,447,483	69.04	-	Others	6,264,871	69.95	-
	Net purchase	7,889,987	100.00		Net purchase	8,956,024	100.00

Explanation for any changes:

NMC (Japan) and NMC (Philippines) are the main suppliers of the Company’s subsidiary Chroma New Material. This is mainly due to an increase in sales of special materials in 2021, so the purchase amount has increased relatively.

1. List of customers accounting for 10 percent or more of the Company's total sales of goods in either of the two most recent years

Information on major customers for the two most recent years

Unit: In thousands of NT$

	2020	2020	2020	2020	2021	2021	2021	2021
Item	Name	Amount	Proportion to net sales of goods for the entire year(%)	Relationship with the issuer	Name	Amount	Proportion to net sales of goods for the entire year(%)	Relationship with the issuer
1	Others	15,532,543	100.00	-	Others	17,584,023	100.00	-
	Net sales	15,532,543	100.00		Net sales	17,584,023	100.00

Explanation for any changes: No single customer’s income in the last two years has exceeded 10% of the Group’s total income.

• 81 -

(V)Production volume and value in the two most recent years

Unit: KM, M, feet, g, units, sets, thousand NT$

Year Production volume and value Primary product	2020	2020	2020	2021	2021	2021
	Production capacity (Note)	Production volume	Production value	Production capacity (Note)	Production volume	Production value
Test instrument equipment	-	104,562	3,796,921	-	167,443	4,632,836
Special material	-	-	-	-	-	-
Automated equipment	-	130	307,353	-	101	508,505
Others	-	-	321	-	-	424
Total	-	104,692	4,104,595	-	167,544	5,141,765

Note: The Company and its subsidiaries adopted a production model of producing many product types for limited quantities instead of mass production using automated production lines. No single product has an exclusive product line. Hence, general assessments for capacity utilization rates cannot be used for such production models. Production processes were based upon the processes required and the work hours provided by the testers. Machinery and equipment were then used to assemble a flexible manufacturing work station. Production volume and capacity for various products was sequenced according to the product market or purchase order requirements. Expected production volume was used to flexibly adjust production capacity in order to achieve maximum benefits using limited economic resources. Hence, all primary products listed above were capable of maintaining stable capacity utilization rate. Products that proved to be competitive in the market could also utilize the most flexible production plan to achieve optimal capacity utilization rates.

(VI) Sales volume in the two most recent years

(VI) Sales volume in the two most recent years	(VI) Sales volume in the two most recent years	(VI) Sales volume in the two most recent years	(VI) Sales volume in the two most recent years	(VI) Sales volume in the two most recent years	(VI) Sales volume in the two most recent years	(VI) Sales volume in the two most recent years	(VI) Sales volume in the two most recent years	(VI) Sales volume in the two most recent years
Unit: KM,M,feet, g,units,sets,thousand NT$
Year Sales Volume and Value Primary product	2020				2021
	Domestic sales		Export sales		Domestic sales		Export sales
	Volume	Value	Volume	Value	Volume	Value	Volume	Value
Test instrument equipment	59,990	1,598,373	154,425	10,446,676	43,934	1,665,708	189,662	11,889,657
Special material	3,136,867,963	2,521,164	70	29,963	3,688,924,107	2,759,909	69	44,397
Automated equipment	108	83,390	22	534,422	82	244,513	19	535,693
Others	-	136,332	-	182,223	-	219,489	-	224,657
Total	3,136,928,061	4,339,259	154,517	11,193,284	3,688,968,123	4,889,619	189,750	12,694,404

III. Employee information in the two most recent years up to the publication date of this annual report

	Year	2020	2021	The current year up to February 28, 2022
Number of employees	Administration and sales staff	1,351	1,420	1,439
	Production staff	809	875	868
	R&D staff	860	876	879
	Total	3,020	3,171	3,186
	Average age	38.01	38.39	38.45
Average years of service		7.25	7.39	7.44
Proportional distribution of academic backgrounds	Doctor	1.14%	1.01%	1.01%
	Master	22.41%	21.75%	21.76%
	University or college	67.63%	68.82%	68.82%
	Senior high school	7.33%	7.18%	7.20%
	Below senior high school	1.49%	1.24%	1.21%

• 82 -

• IV. Environmental protection expenditure

• (I) Total losses and fines from environmental pollution from the most recent year up to the publication date of this annual report: None.

  • In 2021, the Company had no case that caused environmental pollution and resulted in punishment by the competent authority.

• (II) Future response strategies

  • (1) Compliance with laws and regulations: Obtain, identify, follow and comply with regulations and other requirements that can apply to Chroma ATE due to the environmental impact of products, activities, and services, and communicate relevant information to employees.

  • (2) Continuous improvement: Promote environmental policies, aim at pollution prevention, formulate supervision and measurement methods for the control operations and activities related to significant environmental considerations, and evaluate the effectiveness of the environmental management system as the basis for performance evaluation for continuous improvement.

  • (3) Reduce impact: To effectively control environmental impact, provide appropriate protective facilities and equipment or formulate operating standards for related activities to prevent environmental impacts caused by hazardous substances, wastewater, and waste management.

  • (4) Consultation and communication: To strengthen the interaction with employees, the public, suppliers, and stakeholders, establish channels for communicating environmental policies and related information, and provide appropriate responses.

V. Labor relations

• (I) Various employee welfare measures, continuing education and training, retirement systems, and their implementation, as well as various labor-management agreements and measures for safeguarding employee rights and interests.

• Employee welfare measures

  • The Company has established an Occupational Welfare Committee in charge of coordinating and managing employee benefit funds, organizing employee social clubs and tours, ball games, social activities, and gifts for public holidays for fellow employees. The plan also includes subsidies for employee marriage, passing of immediate family, and other celebrations and festivals, subsidies for employee tours, labor, health insurance, and group insurances, establishing employee restaurants, employee dormitories and recreation centers, providing a diverse selection of recreational and entertainment facilities for employees, as well as employee parking spaces.

• Continuing education and training

  • To promote employee competence, knowledge, and management skills required by their duties, the Company stipulated the Education and Training Management Regulations. The Company's business objectives and results of departmental surveys were compiled to formulate the annual training plan. Newly hired staff were provided with work orientation training. On-job training, specialization training, or professional external training were provided every now and then for employees to train professional and talented personnel, improve business performance, and achieve effective utilization of human resources.

2021 training implementation was as follows:

Numberofemployees trained	Training costs
186 participants in external trainings, 7,734 in internal trainings,totaling7,920	NT$1,207 thousand

The content of education and training is based on the overall business strategy, job

• 83 -

requirements, and multiple considerations and designs from the perspective of employees, including professional, management, and general education courses, and are implemented per employees' personal development plans, such as communication skills, innovation ability, leadership ability, projectability, sales ability, etc., to provide employees with a complete training plan.

1. Retirement system

2. Following the Labor Standards Act, the Company has formulated the “Labor Retirement Rules” and made the 4% monthly contributions for the retirement reserve funds to the Trust Department of Bank of Taiwan. Since the implementation of the Labor Pension Act, 6% of the gross proceeds of labor pension shall be allocated to the individual labor pension account monthly to be in line with the new system. For those who voluntarily contribute pension funds, the voluntary contribution shall be withheld from their monthly salary and deposited to the individual pension account as provided by the Bureau of Labor Insurance on July 1, 2005.

The provisions applicable to employee retirement are as follows:

• (1) Voluntary retirement:

An employee may voluntarily apply for retirement in any of the following situations:

• a. Those who have served for more than 15 years and are over 55 years old. b. Having served FST for more than 25 years. c. Aged 60 or above and having completed at least 10 years of service.

• (2) Forced retirement:

• Unless any one of the following circumstances is met, the Company shall not force an employee to retire:

• a. Having reached the age of 65 b. Those with mental disorders or physical disabilities that prevent them from working.

  • The Company may request the competent central authority to adjust the age prescribed above if the specific job entails risk, requires substantial physical strength, or otherwise. However, the age criterium must be no less than 55.

• (3) Pension standards:

• a. Employees who have service seniority accumulated before or after the application of the Labor Standards Act, and choose to be applicable to the Labor Standards Act in accordance with Labor Pension Act or service seniority preserved before the application of the Labor Pension Act, shall have their retirement benefit paid in accordance with Article 55 and Article 84-2 of the Labor Standards Act.

• b. For employees who have service seniority calculated according to the preceding pension payment standard and are forced to retire in accordance with Subparagraph 2 of Paragraph 1 of Article 54 of the Labor Standards Act, an additional 20% on top of the amount calculated according to the preceding pension payment standard shall be given to the worker forced to retire due to disability incurred from the execution of their duties, as set forth in Subparagraph 2 of Paragraph 1 of Article 55.

• c. The length of service, the receipt, and calculation of pensions under the Labor Pension Act shall follow Articles 23 to 28 of the Labor Pension Act.

• (4) Pension benefits:

Pensions under the Labor Standards Act are payable within 30 days from the date of employee retirement.

1. Employee-management agreement

The Company and its subsidiaries place great importance on employee welfare and

• establishing a harmonious employee-employer relationship. In addition to complying with Labour Standards Act and relevant laws, welfare measures considered superior to statutory regulations has also been enacted. Additionally, to promote the efficiency of

• 84 -

internal communication, colleagues are encouraged propose any recommendations. In addition to regular internal communication meetings between various units, communication channels for employee relations have also been established. Any employee inquiry or recommendations can be communicated using Employee Communication Helpline, Employee Communication Email, which are offered to prevent any possible employee-employer disputes.

     5. Measures for safeguarding employee rights To safeguard employee rights and improve the living standards of colleagues, additional labor-management communication channels have been established. The Company has also established the Employee Welfare Committee to plan the allocation, payment, preservation, and utilization of the employee welfare fund and to provide laws specified by relevant laws. Protection of employee rights and implementation of welfare systems shall comply with the relevant laws and regulations.

  - (II)Any loss suffered due to labor disputes, estimated loss for current or future incidents that may occur, and response measures from the most recent year up to the publication date of this annual report, and reasons why a reasonable estimate cannot be made: None.

• VI. Cyber security management

• (I) Description of the risk management framework for cyber security, cyber security policies, specific management plans and resources devoted to cyber security management, etc.

      1. Risk management framework of cyber security
  
      - To improve the performance of the Company's information security management system and to build an information security management system from a risk management perspective, the Company began to build an ISO27001 information security management framework in April 2021 and completed and passed the ISO27001 information security certification in November 2021. The risk management framework of cyber security is as follows:
  
      - In September 2021, according to the "Information Security Management Organization Regulations", the Vice President of the Operation Management Center is responsible for managing the information security organization and information security system maintenance.
  
      - The information security organization consists of the information security audit team, the information security management team, and the information security emergency response team.
  
      2. Information Security Policy
  
      - To protect the security of our important information assets (including software and hardware facilities, operation information systems, R&D results, intellectual property, etc.) and customer data, we have established the following information security management policies.
  
      - (1) To ensure the confidentiality of the Company's business-related information assets and to protect the Company's confidential information and customer assets.
  
      - (2) To ensure the integrity of the Company's business-related information assets and to improve administrative efficiency and data accuracy.
  
      - (3) To ensure the availability of information assets related to the Company's business and to enhance business continuity and information security response.
  
      - (4) To cooperate with the promotion of policies and laws of customers and authorities, and to improve policy compliance and protection requirements.
  
      - (5) To effectively manage organizational information risks to achieve business continuity goals.
  
      - (6) Information security indicators: According to the nature of the business,
  

• 85 -

management indicators are formulated in terms of confidentiality, integrity, availability and customer policy compliance, and approved by the head of the operation management center, and the management of quantitative indicators is used to implement this policy.

1. Specific management plan and resources invested in cyber security management In addition to the establishment of information security management organization and manpower, new employees are provided with basic information security-related education and training when entering the job. Information security advocacy and information security awareness tests are also conducted regularly to enhance colleagues' information security awareness. We also invest in the establishment of various information and communication security management mechanisms and the backup and maintenance mechanisms for important core network equipment.

   • Cyber security management mechanism

     • For confidential information, we implement appropriate encryption mechanisms or endpoint protection measures to reduce the risk of data leakage.

     • For the threat of Internet and mail viruses, advanced continuous threat prevention technology is used to strengthen the protection of mail and Internet to avoid network attacks from any third party.

     • The Company's intranet is equipped with an advanced threat protection mechanism, which monitors protocols of all network ports and detects and responds to inbound, outbound, and lateral spreading targeted attacks to ensure the security of the Company's intranet.

   • Backup and maintenance of critical core network equipment

     • Establishment of a high-availability redundancy architecture for critical

     • core network equipment.

     • Planning a high-availability architecture according to the risk level of information systems to ensure uninterrupted critical information system services.

     • Establishment of an off-site backup mechanism to store important data offsite.

   • Possible abnormal disasters for equipment and hosts in the server room

     • Monitoring the environment of the server room on a regular basis.

     • Conducting various simulation tests and emergency drills in machine rooms in order to ensure the normal operation of various facilities and information systems in machine rooms, to prevent the risks of various disasters or human errors without warning.

2. (II) Any loss suffered due major cyber security incidents from the most recent year up to the publication date of this annual report, possible impact, countermeasures and reasons why a reasonable estimate cannot be made if it cannot be reasonably estimated: The Company's information department is always aware of the latest information security threats. There were no incidents that jeopardized the Company's information security or had a significant adverse impact on the Company's operations in the most recent year or as of the date of the annual report.

3. 86 -

VII. Important contracts

Nature of contract	Party involved	Starting and final date ofthe contract	Major contents	Restrictive terms
Medium and long- term loan contract	Mega International Commercial Bank	March 1, 2018~March 1, 2023	Medium and long-term loan	Credit lines cannot be used to purchase realestate.
Overseas Investment and loan contracts	The Export–	June 17, 2019~June 17, 2026	Investment in the shares of Camtek Ltd., Israel	None
	Import Bank
	of the Republic of China
Joint constructio n contract	Fuyu	September 25, 2019~ September 25, 2023	The Company provided two pieces of land with No. 61 and No. 61-1 in Lejie Section, Guishan District, Taoyuan, covering an area of 15,608.13 square meters (approximately 4,721.46 pings). It cooperated with Fuyu Construction for a residential building. The distribution ratio of joint construction is 47% for the Company and 53% for Fuyu Construction.	None
	Construction
	Co., Ltd.
Property lease contract	ADLINK Technology Inc.	April 1, 2021~March 31, 2026	After the Company sold the old plant in Huaya Park and handover to ADLINK, we rented 4,004 pings from ADLINK. The monthly rent is NT$2,902,900. The lease term is5 years.	None

• 87 -

Chapter6 Financial summary

I. Condensed balance sheet and statement of comprehensive income in the five most recent years

1. Condensed consolidated balance sheet and statement of comprehensive income

Unit: In thousands of NT$

		Unit: In thousands of NT$	Unit: In thousands of NT$	Unit: In thousands of NT$	Unit: In thousands of NT$	Unit: In thousands of NT$
Year Item		Financial information of the 5 most recent years
		2017	2018	2019	2020	2021
Current assets		14,105,784	13,231,273	12,612,242	13,527,839	14,724,532
Property, plant, and equipment		2,664,584	3,389,889	3,221,431	3,156,634	6,096,436
Intangible assets		278,036	274,095	268,601	283,580	323,108
Other assets		4,969,208	6,307,207	9,334,798	11,160,830	8,402,041
Total assets		22,017,612	23,202,464	25,437,072	28,128,883	29,546,117
Current liabilities	Before distribution	6,922,901	5,972,513	7,474,187	8,424,952	7,879,488
	After distribution	8,774,705	7,723,085	8,739,187	10,322,127	10,849,488
Non-current liabilities		1,631,882	2,539,602	3,177,425	3,315,238	2,719,171
Total liabilities	Before distribution	8,554,783	8,512,115	10,651,612	11,740,190	10,598,659
	After distribution	10,406,587	10,262,687	11,916,612	13,637,365	13,568,659
Equity attributable to shareholders of the parent company		13,230,679	14,410,020	14,488,761	16,063,223	18,513,911
Capital stock		4,118,942	4,167,794	4,192,961	4,212,945	4,218,745
Capital surplus		3,187,289	3,469,637	3,629,471	4,036,875	4,087,223
Retained earnings	Before distribution	5,972,296	6,795,059	6,875,970	7,929,190	10,166,996
	After distribution	4,120,492	5,044,487	5,610,970	6,032,015	7,196,996
Other equity		(12,134)	13,244	(187,651)	(82,101)	74,633
Treasury stock		(35,714)	(35,714)	(35,714)	(33,686)	(33,686)
Non-controlling-interests		232,150	280,329	296,699	325,470	433,547
Equity Total	Before distribution	13,462,829	14,690,349	14,785,460	16,388,693	18,947,458
	After distribution	11,611,025	12,939,777	13,520,460	14,491,518	15,977,458
Item	Year	Financial information of the 5 most recent years
		2017	2018	2019	2020	2021
Operatingrevenue		14,901,346	16,931,128	13,909,634	15,532,543	17,584,023
Operating grossprofit(Note 1)		7,068,872	7,458,293	6,580,690	7,544,220	8,450,153
Operating profit or loss		3,043,081	3,039,633	2,059,459	2,797,401	3,074,993
Non-operatingincome and expenses		78,986	268,457	279,147	231,606	2,208,853
Netprofit before tax		3,122,067	3,308,090	2,338,606	3,029,007	5,283,846
Netprofit from continuingoperations for theperiod		2,548,823	2,547,179	1,889,476	2,380,957	4,305,315
Loss from discontinued operations		─	─	─	─	─
Netprofit(loss)for theperiod		2,548,823	2,547,179	1,889,476	2,380,957	4,305,315
Other comprehensive income for the period (net amount after tax)		(138,228)	3,487	(249,805)	78,137	106,234
Total comprehensive income for theperiod		2,410,595	2,550,666	1,639,671	2,459,094	4,411,549
Net profit attributable to shareholders of the parent company		2,558,401	2,546,275	1,854,481	2,323,776	4,179,232
Netprofit attributable to non-controllinginterests		(9,578)	904	34,995	57,181	126,083
Total comprehensive income attributable to shareholders of theparent company		2,425,174	2,546,584	1,608,601	2,412,798	4,294,625
Total comprehensive income attributable to non- controllinginterests		(14,579)	4,082	31,070	46,296	116,924
Earningsper share(NT$)		6.41	6.22	4.48	5.56	9.96

Note 1: Presented based on the net realized operating gross profit after deducting the unrealized operating gross profit.

Note 2: On February 23, 2022, the Board of Directors proposed the earnings distribution plan and cash dividend for the shareholders for FY2021 of NT$2,970,000,000.

• 88 -

2. Parent company only balance sheet and comprehensive income or loss sheet - International Financial Reporting Standards

Unit: In thousands of NT$

		Unit: In thousands of NT$	Unit: In thousands of NT$	Unit: In thousands of NT$	Unit: In thousands of NT$	Unit: In thousands of NT$
Year Item		Financial information of the 5 most recent years
		2017	2018	2019	2020	2021
Current assets		8,212,509	6,640,159	6,544,302	6,852,858	7,471,189
Property, plant, and equipment		1,789,099	2,493,620	2,406,545	2,352,493	5,325,381
Intangible assets		94,424	94,424	94,424	113,588	149,251
Other assets		8,463,667	10,098,682	12,757,869	15,087,123	12,422,739
Total assets		18,559,699	19,326,885	21,803,140	24,406,062	25,368,560
Current liabilities	Before distribution	3,877,087	2,551,737	4,347,102	5,286,457	4,511,048
	After distribution	5,731,511	4,302,633	5,612,102	7,183,632	7,481,048
Non-current liabilities		1,451,933	2,365,128	2,967,277	3,056,382	2,343,601
Total liabilities	Before distribution	5,329,020	4,916,865	7,314,379	8,342,839	6,854,649
	After distribution	7,183,444	6,667,761	8,579,379	10,240,014	9,824,649
Equity attributable to shareholders of the parent company		13,230,679	14,410,020	14,488,761	16,063,223	18,513,911
Capital stock		4,118,942	4,167,794	4,192,961	4,212,945	4,218,745
Capital surplus		3,187,289	3,469,637	3,629,471	4,036,875	4,087,223
Retained earnings	Before distribution	5,972,296	6,795,059	6,875,970	7,929,190	10,166,996
	After distribution	4,117,872	5,044,163	5,610,970	6,032,015	7,196,996
Other equity		(12,134)	13,244	(187,651)	(82,101)	74,633
Treasury stock		(35,714)	(35,714)	(35,714)	(33,686)	(33,686)
Non-controlling-interests		─	─	─	─	─
Equity Total	Before distribution	13,230,679	14,410,020	14,488,761	16,063,223	18,513,911
	After distribution	11,376,255	12,659,124	13,223,761	14,166,048	15,543,911

Year Item	Financial information of the 5 most recent years	Financial information of the 5 most recent years	Financial information of the 5 most recent years	Financial information of the 5 most recent years	Financial information of the 5 most recent years
	2017	2018	2019	2020	2021
Operatingrevenue	8,018,006	7,546,840	8,111,033	9,180,240	10,308,453
Operating grossprofit(Note 1)	4,116,862	3,916,720	4,092,554	4,866,948	5,418,461
Operating profit or loss	1,759,378	1,514,112	1,690,390	2,260,437	2,446,302
Non-operatingincome and expenses	1,106,336	1,414,496	459,985	534,543	2,499,108
Netprofit before tax	2,865,714	2,928,608	2,150,375	2,794,980	4,945,410
Netprofit from continuingoperations for theperiod	2,558,401	2,546,275	1,854,481	2,323,776	4,179,232
Loss from discontinued operations	─	─	─	─	─
Netprofit of thisperiod	2,558,401	2,546,275	1,854,481	2,323,776	4,179,232
Other comprehensive income or loss (net value after tax) in thisperiod	(133,227)	309	(245,880)	89,022	115,393
Total comprehensive income for theperiod	2,425,174	2,546,584	1,608,601	2,412,798	4,294,625
Net profit attributable to shareholders of the parent company	2,558,401	2,546,275	1,854,481	2,323,776	4,179,232
Netprofit attributable to non-controllinginterests	─	─	─	─	─
Total comprehensive income attributable to shareholders of theparent company	2,425,174	2,546,584	1,608,601	2,412,798	4,294,625
Total comprehensive income attributable to non- controllinginterests	─	─	─	─	─
Earningsper share (NT$)	6.41	6.22	4.48	5.56	9.96

Note 1: Presented as the realized operating gross profit after deducting the unrealized interests of subsidiaries and associates. Note 2: On February 23, 2022, the Board of Directors proposed the earnings distribution plan and cash dividend for the shareholders for FY2021 of NT$2,970,000,000.

• 89 -

• Name of the attesting CPAs for the 5 most recent years and audit opinions (1) Name of the attesting CPAs for the 5 most recent years and audit opinions

Year	Accountingfirm	Name of the CPA	Audit opinions
2017	Deloitte & Touche	Cheng-Ming Lee, Wen-Chi Kuo	Unqualified opinion
2018	Deloitte & Touche	Cheng-Ming Lee, Wen-Chi Kuo	Unqualified opinion
2019	Deloitte & Touche	Cheng-Ming Lee, Wen-Chi Kuo	Unqualified opinion
2020	Deloitte & Touche	Cheng-Ming Lee, Wen-Chi Kuo	Unqualified opinion
2021	Deloitte & Touche	Wen-Chin Lin, Chien-Liang Liu	Unqualified opinion

• (2) Accounting firms, former and successor CPAs, and reasons for the replacement for any replacement of CPAs in the 5 most recent years

• ①Reasons for replacing CPAs in 2021

• a. Names of predecessor and successor CPAs:

  • Predecessors: CPA Cheng-Ming Lee and CPA Wen-Chi Kuo Successors: CPA Wen-Chin Lin and CPA Chien-Liang Liu

• b. Reasons for change: To meet the needs of internal adjustment of Qinye Zhongxin United Certified Public Accountants.

• c. Date of occurrence of the fact: April 28, 2021

• d. Any disagreement relating to accounting principles or auditing items between the former and successor CPAs: None

• 90 -

II. Financial analysis in the five most recent years

1. Consolidated financial analysis - International Financial and Accounting Reporting Standards

Standards	Standards
Year Itemanalyzed (Note2)		Financial analysis for the five most recentyears
		2017	2018	2019	2020	2021
Capital structure (%)	Debt to assets ratio	38.85	36.69	41.87	41.74	35.87
	Long-term capital to property, plant, and equipment ratio	566.49	508.27	557.61	624.21	355.40
Solvency (%)	Current ratio	203.76	221.54	168.74	160.57	186.87
	Quick ratio	161.87	163.98	129.77	122.28	133.86
	Interest coverage multiplier	138.04	105.13	44.29	52.50	119.11
Operating performance	Receivables turnover rate (times)	4.04	3.72	2.80	3.17	3.49
	Average collection days	90	98	130	115	105
	Inventory turnover rate (times)	2.97	2.95	2.59	2.51	2.38
	Payables turnover rate (times)	3.15	3.45	2.82	3.00	3.18
	Average sales days	123	124	141	145	153
	Property, plant, and equipment turnover rate (times)	5.54	5.59	4.21	4.87	3.80
	Total asset turnover rate (times)	0.73	0.75	0.57	0.58	0.61
Profitability	Return on assets (%)	12.68	11.37	7.80	8.85	14.62
	Return on equity (%)	21.46	18.42	12.83	15.21	24.17
	Net profit before tax to paid-in capital ratio (%)	75.80	79.37	55.77	71.90	125.25
	Net profit margin (%)	17.17	15.04	13.33	14.96	23.77
	Earnings per share (NT$)	6.41	6.22	4.48	5.56	9.96
Cash flow	Cash flow ratio (%)	39.71	21.19	18.26	32.19	32.89
	Cash flow adequate ratio (%)	89.99	77.28	68.13	65.50	62.77
	Cash reinvestment ratio (%)	10.36	(Note 1)	(Note 1)	9.09	3.39
Leverage	Operating leverage	1.10	1.10	1.22	1.16	1.19
	Financial leverage	1.01	1.01	1.03	1.02	1.01
Please explain the reasons for changes in various financial ratios in the last two years. (analysis is not required if the change is within 20%). The following describes the reason for changes to financial ratios that exceed 20% in the two most recent years: 1. Decrease in long-term capital to property, plant and equipment ratio: Mainly due to the decrease in long-term loans and increase in property, plant and equipment. 2. Increase in interest coverage multiplier: Mainly due to the disposal of the Huaya plant and the significant increase in non-operating income. 3. Decrease in property, plant and equipment turnover rate (times): Mainly due to the increase in property, plant and equipment as a result of the acceptance of the new plant in A7 and its transfer to property, plant and equipment. 4. Increase in return on assets and return on equity: Mainly due to the gain on disposal of the Huaya plant, which resulted in a significant increase in net profit for the period. 5. Increase in net income before tax to paid-in capital ratio: Mainly due to the significant increase in net income before tax as a result of the disposal of property, plant and sale and leaseback transfer gain of approximately NT$1.74 billion. 6. Increase in net profit margin and EPS: Mainly due to the disposal of the Huaya plant and the significant increase in non-operating income. 7.Decrease in cash reinvestment ratio: Mainly due to the increase in cash dividends and the increase in gross property, plant and equipment.

Note 1: Net cash flow from operating activities - since cash dividends are negative, the relevant ratio does not apply. Note 2: The following lists the formulas used for performing the financial analysis:

1. Capital structure

2. 91 -

3. (1) Debt to assets ratio = total liabilities/total assets

4. (2) Long-term capital to property, plant, and equipment ratio = (total equity + non-current liabilities)/net property, plant, and equipment

5. Solvency

6. (1) Current ratio = Current assets/Current liabilities.

7. (2) Quick ratio = (Current asset - inventories)/Current liabilities

8. (3) Interest coverage multiplier = Earnings before interests and taxes (EBIT)/Interest expenses over this period.

9. Operating performance

10. (1) Receivable (including accounts receivable and notes receivable from business operations) turnover rate = net sales / balance of average accounts receivable for various periods (including accounts receivable and notes receivable from business operations).

11. (2) Average collection days = 365/Receivables turnover ratio.

12. (3) Inventory turnover rate = Cost of sales / Average inventory value

13. (4) Payable turnover rate (including bills payable resulting from accounts payable and business operations) = Cost of goods sold/Average accounts payable in various periods (including bills payable resulting from accounts payable and business operations).

14. (5) Average sales days = 365/Inventory turnover ratio.

15. (6) Property, plant, and equipment turnover rate = Net sales / Average value of PP&E

16. (7) Total assets turnover rate = Net sales / Average total asset value.

17. Profitability

18. (1) Return on assets ＝ [Net income after taxes + Interest expense (1– Tax rate)]/Average total assets.

19. (2) Return on equity = Net income after taxes/Average total equity.

20. (3) Net profit margin = Gain (loss) after tax / Net sales

21. (4) Earnings per share = (Net profit (loss) attributable to the owners of the parent company – Preferred dividends) / Weighted average number of shares outstanding.

22. Cash flow

23. (1) Cash flow ratio = Net cash flow of business activities / Current liabilities.

24. (2) Net cash flow adequacy ratio = Net cash flow from operating activities for the five most recent years/(Capital expenditure + Inventory increase + Cash dividend) for the most recent five years.

25. (3) Cash reinvestment ratio = (Net cash flow from operating activities – Cash dividend)/Gross value of PP&E + Long-term investments + Other non-current assets + Working capital).

26. Leverage

27. (1) Operating leverage = (Net operating revenue - Change in operating costs and operating expenses)/Operating income.

28. (2) Financial leverage = Operating income/(Operating income - Interest expenses)

29. Note 3: The formula listed above for calculating EPS shall take special consideration of the following matters during calculations:

30. Calculation is made based upon the weighted average of common shares and not the number of issued shares at the end of the year.

31. Where cash capital increase or transaction of treasury stock is involved, weighted average number of shares shall be calculated by taking into consideration circulation period.

32. Where recapitalization of retained earnings or recapitalization of capital surplus is involved, retrospective adjustment shall be made according to the proportion of recapitalization when calculating annual and semiannual earnings per share. There is no need to consider the period of issuance for the said recapitalization.

33. If the preferred share cannot be converted into cumulative preferred shares, then the dividend of the year (whether it has been issued or not) shall be deducted from net income after tax (NIAT), or included as a net loss after tax. If the preferred share is non-cumulative, dividends for the preferred share shall be deducted from any NIAT resulting from this period. No readjustments would be required for losses.

34. Note 4: The following items shall be taken note of during cash flow analysis:

35. Net cash flow of business activities shall refer to the amount of net cash inflow for business activities indicated in the cash flow statement.

36. Capital expenditure shall refer to cash outflow for annual capital investments.

37. Inventory increase is only included in the calculation when the ending balance is greater than the beginning balance. Inventory decrease at the end of the year shall be calculated as zero.

38. Cash dividends include those for common shares as well as preferred shares.

39. Gross value of property, plant and equipment (PP&E) refers to the total value of PP&E before deducting accumulated depreciation.

40. Note 5: The issuer shall categorize operating costs and operating expenses as fixed and variable based on the nature of these items. Where estimates or subjective judgments must be made, care must be taken to ensure their validity and consistency.

41. Note 6: Where the share of the Company has no par value or its par value is not NT$10 per share, the abovementioned ratio of income before tax to paid-in capital shall be replaced with the ratio of income before tax to equity attributable to the owner of the parent company listed in the balance sheet.

42. 92 -

2. Parent company-only financial analysis

2. Parent company-onlyfinancial analysis	2. Parent company-onlyfinancial analysis
Year Itemanalyzed		Financial analysis for the five most recentyears
		2017	2018	2019	2020	2021
Capital structure (%)	Debt to assets ratio	28.71	25.44	33.55	34.18	27.02
	Long-term capital to property, plant, and equipment ratio	820.67	672.72	725.36	812.74	391.66
Solvency (%)	Current ratio	211.82	260.22	150.54	129.63	165.62
	Quick ratio	161.19	184.01	100.28	84.28	97.54
	Interest coverage multiplier	230.44	135.59	61.27	81.22	220.72
Operating performance	Receivables turnover rate (times)	2.91	2.58	2.69	2.87	3.60
	Average collection days	125	141	136	127	101
	Inventory turnover rate (times)	2.07	1.75	1.82	1.79	1.63
	Payables turnover rate (times)	3.01	3.01	3.54	3.83	3.76
	Average sales days	176	209	201	204	224
	Property, plant, and equipment turnover rate (times)	4.46	3.52	3.31	3.86	2.69
	Total asset turnover rate (times)	0.46	0.40	0.39	0.40	0.41
Profitability	Return on assets (%)	14.62	13.53	9.16	10.18	16.86
	Return on equity (%)	21.46	18.42	12.83	15.21	24.17
	Net profit before tax to paid-in capital ratio (%)	69.57	70.27	51.29	66.34	117.22
	Net profit margin (%)	31.91	33.74	22.86	25.31	40.54
	Earnings per share (NT$)	6.41	6.22	4.48	5.56	9.96
Cash flow	Cash flow ratio (%)	17.05	71.13	35.36	38.75	45.01
	Cash flow adequate ratio (%)	61.09	63.58	59.71	57.38	52.29
	Cash reinvestment ratio (%)	(Note)	(Note)	(Note)	5.44	0.73
Leverage	Operating leverage	1.12	1.12	1.16	1.08	1.19
	Financial leverage	1.01	1.01	1.02	1.02	1.01
Please explain the reasons for changes in various financial ratios in the last two years. (analysis is not required if the change is within 20%). The following describes the reason for changes to financial ratios that exceed 20% in the two most recent years: 1.Decrease in debt to assets ratio: Mainly due to the decrease in the amount of debt by the repayment of bank loans. 2.Decrease in long-term capital to property, plant and equipment ratio: Mainly due to the decrease in long-term loans and increase in property, plant and equipment. 3.Increase in current ratio: Mainly due to the increase in cash in current assets and the decrease in short-term borrowings in current liabilities. 4.Increase in interest coverage multiplier: Mainly due to the disposal of the Huaya plant and the significant increase in non-operating income. 5.Increase in receivables turnover rate (times) and decrease in average collection days: Mainly due to the year-over-year growth in revenue in 2021 and good collection results. 6.Decrease in property, plant and equipment turnover rate (times): Mainly due to the increase in property, plant and equipment as a result of the acceptance of the new plant in A7 and its transfer to property, plant and equipment. 7.Increase in return on assets and return on equity: Mainly due to the gain on disposal of the Huaya plant, which resulted in a significant increase in net profit for the period. 8.Increase in net income before tax to paid-in capital ratio: Mainly due to the significant increase in net income before tax as a result of the disposal of property, plant and sale and leaseback transfer gain of approximately NT$1.74 billion. 9.Increase in net profit margin and EPS: Mainly due to the disposal of the Huaya plant and the significant increase in non-operating income. 10. Decrease in cash reinvestment ratio: Mainly due to the increase in cash dividends and the increase in gross property, plant and equipment.

Note: Net cash flow from operating activities - since cash dividends are negative, the relevant ratio does not apply.

• 93 -

III. Audit Committee's audit report on financial statements in the most recent year

Chroma ATE Co., Ltd.

Audit Committee’s Audit Report

The Board of Directors has prepared the Company’s 2021 Business Report, Financial Statements (consolidated and parent company-only financial statements included), and proposal for allocation of earnings. The CPAs, Wen-Chin Lin, Chien-Liang Liu of Deloitte & Touche audited the Financial Statements and have issued an audit report relating to the Financial Statements. The list of all books opened was reviewed by the Audit Committee and it was considered that there were no discrepancies. The 14th Article of the Securities Exchange Act and Article 219 of the Company Act were submitted for verification.

Yours sincerely Chroma ATE Co., Ltd. 2022 Annual General Meeting

Audit committee convener: Steven Wu

March 7, 2022

• 94 -

• IV. Financial statements in the most recent year: Please refer to Page 112~191 of this report.

• V. The Company’s parent company only financial statements audited and attested by CPA in the most recent year: Please refer to Page 192~263 of this report.

• VI. Any financial difficulties experienced by the Company and its affiliated companies during the most recent year up to the publication date of this annual report as well as the impact of the said difficulties on the financial condition of the Company: None.

• 95 -

Chapter 7 Review, analysis, and risks of financial position and performance

I. Financial condition

Comparative analysis of financial conditions

		Units: In thousands of NT$;% December 31, 2020 Difference Amount % 13,527,839 1,196,693 9% 3,156,634 2,939,802 93% 3,137,187 0 0% 283,580 39,528 14% 8,023,643 (2,758,789) (34%) 28,128,883 1,417,234 5% 8,424,952 (545,464) (6%) 3,315,238 (596,067) (18%) 11,740,190 (1,141,531) (10%) 4,212,945 5,800 0% 4,036,875 50,348 1% 7,929,190 2,237,806 28% (82,101) 156,734 191% (33,686) 0 0% 325,470 108,077 33% 16,388,693 2,558,765 16%	Units: In thousands of NT$;% December 31, 2020 Difference Amount % 13,527,839 1,196,693 9% 3,156,634 2,939,802 93% 3,137,187 0 0% 283,580 39,528 14% 8,023,643 (2,758,789) (34%) 28,128,883 1,417,234 5% 8,424,952 (545,464) (6%) 3,315,238 (596,067) (18%) 11,740,190 (1,141,531) (10%) 4,212,945 5,800 0% 4,036,875 50,348 1% 7,929,190 2,237,806 28% (82,101) 156,734 191% (33,686) 0 0% 325,470 108,077 33% 16,388,693 2,558,765 16%	Units: In thousands of NT$;% December 31, 2020 Difference Amount % 13,527,839 1,196,693 9% 3,156,634 2,939,802 93% 3,137,187 0 0% 283,580 39,528 14% 8,023,643 (2,758,789) (34%) 28,128,883 1,417,234 5% 8,424,952 (545,464) (6%) 3,315,238 (596,067) (18%) 11,740,190 (1,141,531) (10%) 4,212,945 5,800 0% 4,036,875 50,348 1% 7,929,190 2,237,806 28% (82,101) 156,734 191% (33,686) 0 0% 325,470 108,077 33% 16,388,693 2,558,765 16%
Year			Difference
	December 31, 2021	December 31, 2020
Item			Amount	%
Current assets	14,724,532	13,527,839	1,196,693	9%
Property,plant, and equipment	6,096,436	3,156,634	2,939,802	93%
Investmentproperty	3,137,187	3,137,187	0	0%
Intangible assets	323,108	283,580	39,528	14%
Other assets	5,264,854	8,023,643	(2,758,789)	(34%)
Total assets	29,546,117	28,128,883	1,417,234	5%
Current liabilities	7,879,488	8,424,952	(545,464)	(6%)
Non-current liabilities	2,719,171	3,315,238	(596,067)	(18%)
Total liabilities	10,598,659	11,740,190	(1,141,531)	(10%)
Capital stock	4,218,745	4,212,945	5,800	0%
Capital surplus	4,087,223	4,036,875	50,348	1%
Retained earnings	10,166,996	7,929,190	2,237,806	28%
Other equity	74,633	(82,101)	156,734	191%
Treasurystock	(33,686)	(33,686)	0	0%
Non-controlling-interests	433,547	325,470	108,077	33%
Total stockholders' equity	18,947,458	16,388,693	2,558,765	16%
1. Major reasons and impact of any material change to the Company's assets, liabilities, or equity in the two most recent years: (analysis of changes whose percentage exceeds 20%, and whose amount reaches NT$10 million shall be provided) (1) Increase in property, plant and equipment: Mainly due to the transfer of the prepaid construction to property, plant and equipment by the acceptance of the construction of Plant A7. (2) Decrease in other assets: Mainly due to the transfer of prepaid construction to property, plant and equipment and decrease in prepaid land and equipment by the acceptance of the construction of Plant A7. (3) Increase in retained earnings: Mainly due to the gain on sale of the Huaya plant and the significant increase in non-operating income. (4) Increase in other equity: Mainly due to increase in unrealized profit of financial assets measured by fair value through other comprehensive income. (5) Increase in non-controlling interests: Mainly due to the increase in net income of equity-method investees, JSI, CSS and Quantel, and the change in equity in Innovative Nanotech Incorporated. 2. Future response plan: These changes were considered part of normal business operations, and would not lead to severe negative impacts upon the overall financial operations of the Companyand its subsidiaries.

1. Major reasons and impact of any material change to the Company's assets, liabilities, or equity in the two most recent years: (analysis of changes whose percentage exceeds 20%, and whose amount reaches NT$10 million shall be provided)

2. (1) Increase in property, plant and equipment: Mainly due to the transfer of the prepaid construction to property, plant and equipment by the acceptance of the construction of Plant A7.

3. (2) Decrease in other assets: Mainly due to the transfer of prepaid construction to property, plant and equipment and decrease in prepaid land and equipment by the acceptance of the construction of Plant A7.

4. (3) Increase in retained earnings: Mainly due to the gain on sale of the Huaya plant and the significant increase in non-operating income.

5. (4) Increase in other equity: Mainly due to increase in unrealized profit of financial assets measured by fair value through other comprehensive income.

6. (5) Increase in non-controlling interests: Mainly due to the increase in net income of equity-method investees, JSI, CSS and Quantel, and the change in equity in Innovative Nanotech Incorporated.

7. Future response plan: These changes were considered part of normal business operations, and would not lead to severe negative impacts upon the overall financial operations of the Company and its subsidiaries.

8. 96 -

II. Financial performance

Financial performance analysis

				Units: In thousands of NT$;%	Units: In thousands of NT$;%	Units: In thousands of NT$;%
Item	Year	2021	2020	Sum of changes	Proportion of changes (%)
Operating revenue		17,584,023	15,532,543	2,051,480	13%
Operating gross profit (Note)		8,450,153	7,544,220	905,933	12%
Net operating profit		3,074,993	2,797,401	277,592	10%
Non-operating income and expenses		2,208,853	231,606	1,977,247	854%
Net profit before tax		5,283,846	3,029,007	2,254,839	74%
Net profit of this period		4,305,315	2,380,957	1,924,358	81%
Other comprehensive income the period	for	106,234	78,137	28,097	36%
Total comprehensive income for the period		4,411,549	2,459,094	1,952,455	79%
Net profit attributable to shareholders ofthe parent company		4,179,232	2,323,776	1,855,456	80%
Total comprehensive income
attributable to shareholders of the		4,294,625	2,412,798	1,881,827	78%
parent company

1. Major reasons and impact of any material change to the Company’s operating revenue, operating profit, and earnings before tax (EBT) in the two most recent years: (analysis of changes whose percentage exceeds 20%, and whose amount reaches NT$10 million shall be provided)

2. (1) Increase in non-operating income and expenses: Mainly due to the gain on sale of the Huaya plant of NT$1.73 billion and the significant increase in non-operating income.

3. (2) Increase in net profit before tax, net profit for the period, total comprehensive income for the period, net profit attributable to shareholders of the parent company, and total comprehensive income attributable to shareholders of the parent company: Mainly due to the gain on disposal of the Huaya plant and the significant increase in non-operating income

4. (3) Increase in other comprehensive income for the period: Mainly due to the increase in the share of other comprehensive income of affiliates and joint ventures accounted for using the equity method and the increase in unrealized valuation gains or losses on investments in equity instruments measured at fair value through other comprehensive income

5. Expected sales volume and relevant data, possible impact on the Company’s financial operations, and response plans:

6. The material shortage crisis will not be alleviated in 2022. The two major challenges for the

7. Company are to invest in research and development to find alternative materials to solve the material shortage crisis, and to actively source materials to ensure timely delivery to meet customer demand; and to accelerate the development of advanced semiconductor process testing equipment to obtain customer quality certification and increase market scale to ensure continuous revenue growth in 2022.

Note: Presented on the basis of realized net operating gross profit.

• 97 -

III. Cash flow

Cash liquidity analysis

(I) Analysis and explanations of changes in cash flow in the most recent year

Unit: In thousands of NT$

Opening cash balance	Net cash inflow from operating activities in the year	Total net cash inflow (outflow) from investing and financing activities in theyear(Note)	Cash surplus (shortfall)	Remedial measures for cash shortfall	Remedial measures for cash shortfall
				Investment plan	Financing plan
2,896,645	2,591,787	(2,400,274)	3,088,158	─	─
Note: Including net cash inflow from investing activities of $1,737,628 thousand, net cash outflow from financing activities of $4,071,229 thousand and exchange rate effects of $66,673 thousand. 1. Analysis of changes in cash flow in the most recent year: (1) Operating activities: Net cash inflow from operating activities in 2021 was NT$2,591,787 thousand, mainly from operating profit. (2) Investing activities: The net cash inflow from investing activities in 2021 was NT$1,737,628 thousand, which was mainly due to the cash inflow from disposal of the Huaya plant. (3) Financing activities: The net cash outflow of $4,071,229 thousand from financing activities in 2021 was mainly due to cash dividends and cash outflow from repayment of bank loans. 2. Remedial measures and liquidityanalysis for cash shortfall: Not applicable.

• Note: Including net cash inflow from investing activities of $1,737,628 thousand, net cash outflow from financing activities of $4,071,229 thousand and exchange rate effects of $66,673 thousand.

(II) Analysis of cash liquidity for the following year

Unit: In thousands of NT$

Opening cash balance	Expected net cash inflow from operating activities in the year	Expected total net cash inflow (outflow) from investing and financing activities in theyear	Expected cash surplus (shortfall)	Remedial measures for expected cash shortfall	Remedial measures for expected cash shortfall
				Investment plan	Financing plan
3,088,158	2,650,000	(2,900,000)	2,838,158	─	─
1. Analysis of changes to cash flow in the most recent year (1) Operating activities: Mainly refers to cash inflow generated by business profits. (2) Investing activities: Cash outflow from the payment for the second phase of new construction and equity investment. (3) Financing activities: mainly the cash outflow of expected cash dividends and the cash inflow of bank borrowings. 2. Remedial measures and liquidityanalysis for expected cash shortfall: Not applicable.

• IV. Impact of material expenditures on the Company's finances and operations in the most recent year

The Company, Dynapack International Technology and HERAN Co., Ltd., on January 17, 2012, acquired the tender for the Ministry of Interior’s Industrial Development Zone (Tender A) in the Taoyuan International Airport Access MRT Station A7 Transit-Oriented Development Zone. The total transaction amount of this tender was NT$10,088,890 thousand, with a total land area of 222,300 square meters, 35% of which were held by the Company. The 77,805 square meters owned by the Company are subject to a bidding amount of NT$3,531,112 thousand. The Company entered into a land transaction deed with the Ministry of the Interior on April 18, 2012, and completed the payment of the entire land in June 2018. The registration of the land equity transfer has been completed. In order to meet operational requirements, the Company decided on December 27, 2016 to build the A7 plant & office building in the abovementioned industrial zone (land No. 62), and construct the A7 plant to expand production capacity, increase R&D laboratory space, invest more R&D resources to develop more key technologies and products, and provide comprehensive (turnkey) testing and automation

• 98 -

solutions, in order to maintain the Company's long-term competitiveness and provide more fast, accurate, and reliable products to the industry. The Company completed the plant expansion and relocation of headquarters at the end of 2020, and the new headquarters will serve as the foundation for the development of new business units in the future.

• V. Investment policies in other companies, the main reasons for profit/losses, improvement plan,

• and investment plans for the upcoming year

  • (I) Investment policy: reinvestment in accordance with the Company's operational needs and consideration of future development strategies and other factors.

  • (II) The profit from investment recognized under the equity method in 2021 was NT$752,111 thousand. The Company's investments under the equity method were all for the purpose of long-term strategic investment.

  • (III) Investment plan for the coming year: To increase capital in the existing investment business and to invest in companies with unique technology to ensure the leading key technology and to maintain the Company's competitive advantage and growth.

VI. Risk analysis and assessment of the most recent year up to the publication date of this annual

report

• (I) Changes to interest rates, currency exchange fluctuations, and inflation and how these may impact the Company penetrate loss as well as future response measures

• Changes to interest rates and the resulting impact on the Company's gain or loss as well as future response measures

  • (1) Changes to interest rates and impact on the gain or loss of the Company and its subsidiaries

Unit: In thousands of NT$

subsidiaries	Unit: In	thousands of NT$
Item/Year	2020	2021
Interest expense	58,811	44,738
Net operatingrevenue	15,532,543	17,584,023
Operating profit	2,797,401	3,074,993
Interest expense/Operatingrevenue(%)	0.38	0.25
Interest expense/Operating profit(%)	2.10	1.45

Interest expenses amounted to NT$58,811 thousand and NT$44,738 thousand for 2020 and 2021, respectively, and the ratio of interest expenses to operating revenue was 2.10% and 1.45%, respectively, which were quite correlated to the changes in profit or loss of the Company and its subsidiaries.

• (2) Future countermeasures

The Company and its subsidiaries have been carrying out capital planning based on the principle of stability and conservatism, and focus primarily on safety and liquidity. Finance personnel of the Consolidated Company maintains close contact with its financial institutions, pays attention to the trends and changes in market interest rates at all times, negotiates interest rates with various banks, and actively reduces the cost of working capital to reduce the impact of interest rate fluctuations on the Company’s profitability.

1. Currency exchange fluctuations and the resulting impact on the Company's gain or loss as well as future response measures

2. (1) Currency exchange fluctuations and the resulting impact on the gain or loss of the Company and its subsidiaries

3. 99 -

Unit: In thousands of NT$	Unit: In thousands of NT$	Unit: In thousands of NT$
Item/Year	2020	2021
Net exchange loss	(86,618)	(54,773)
Net operatingrevenue	15,532,543	17,584,023
Operating profit	2,797,401	3,074,993
Netprofit before tax	3,029,007	5,283,846
Exchange loss to net operatingrevenue(%)	(0.56)	(0.31)
Exchange loss to net operating profit(%)	(3.10)	(1.78)
Exchange loss to netprofit before tax(%)	(2.86)	(1.04)

The Company and its subsidiaries have accounts receivable and accounts payable denominated in USD, therefore, changes in USD exchange rates are correlated with changes in foreign exchange gains and losses of the Company and its subsidiaries. For the years ended December 31, 2020 and 2021, the exchange loss amounted to NT$(86,618) thousand and NT$(54,773) thousand, respectively, and the ratio of exchange loss to net profit before tax was (2.86)% and (1.04)%, respectively.

• (2) Future countermeasures

In response to the risk of exchange rate changes, the Company and its subsidiaries directly offset foreign currency payables and foreign currency shortterm bank borrowings arising from purchases of increased foreign currency receivables directly through U.S. dollar transactions to achieve the effect of natural hedging; also, financial units and financial institutions maintain close contact, collect exchange rate information daily, grasp exchange rate trends and changes, and adjust foreign currency positions promptly to reduce the impact of exchange rate fluctuations on the Company's profit and loss.

1. Inflation and its impact on the Company’s gain or loss as well as future response measures

2. (1) Inflation and its impact on the gain or loss of the Company and its subsidiaries The Company and its subsidiaries have not been affected by inflation severe enough to result in a major impact on the gains or losses to the Company and its subsidiaries during the period of the most recent year to the publication date of this report.

3. (2) Future countermeasures

The Company and its subsidiaries are minimally affected by inflation, but will continue to monitor changes in the prices of upstream and downstream products to reduce its impact on their gains or losses as a result of cost changes.

• (II) Policies on high risk, highly leveraged investments, loans to other parties, endorsements, guarantees, and derivatives trading, main reasons for the profits or losses generated thereby, and future response measures to be undertaken.

• Main reasons for engaging in high risk, highly leveraged investments and future response measures

• (1) Main reasons for engaging in high risk, highly leveraged investments The Company and its subsidiaries have not engaged in any high risk, highly leveraged investment from the most recent year to the publication date of this report.

• (2) Future countermeasures

The Company and its subsidiaries are focused on specialized businesses and adopt a conservative and stable financial operation by principle. No capital is applied for high risk, highly leveraged investments.

1. Loans to other parties, endorsements, and guarantees

2. (1) Reasons for providing loans to other parties, endorsements, and guarantees The Company and its subsidiaries are engaged in fund loans and endorsement guarantees based on the principle that there are business contacts or associates. The

3. 100 -

fund loan and interest rates are higher than the Company and its subsidiaries' shortterm borrowing rates from financial institutions.

(2) Future countermeasures

The Company has stipulated Provision of Financial Loans to Other Parties as well as Endorsement and Guarantee Operations Procedure and refer to the relevant provisions to provide relevant public disclosures.

1. Policies on derivatives trading, major reasons for profits or losses as well as future response measures

2. (1) Policies when engaging in derivatives trading and major reasons for profits or losses All derivatives trading engaged by the Company and its subsidiaries include hedging of foreign exchange risks generated by the assets or liabilities. No derivatives trading have been implemented in the most recent fiscal year up to the publication date of this annual report.

3. (2) Future countermeasures

The Company and its subsidiaries shall adopt a conservative business principle and seek stable growth, and shall continue to assess impacts to profits or losses resulting from exchange rate fluctuations. To manage transaction risks, the Company and its subsidiaries shall refer to regulations prescribed in the Procedure for Handling Derivatives Trading, and activate foreign exchange risk avoidance tools and avoid improper and high risk transactions.

• (III) Future R&D plans and expected R&D investments

R&D plan	Current progress	Expected completion time	Additional investments required	Remark
Ultra high resolution Video Generator forGamingTesting	Design verification phase	2022/Q3	NT$10 million
High performance Battery cell series chargeFormationSystem	Design planning phase	2023/Q1	NT$20 million
Laboratory-level high-precision vehicle powerbattery test system	Design verification phase	2022/Q3	NT$20 million
Research in Characteristics measurement and defect detection of energy storage components	Design verification phase	2022/Q4	NT$35 million
Next Generation High performance Elelctrical Motor Emulator	Design verification phase	2022/Q4	NT$15 million
Next Generation Dual-axle Dynamometer	Design verification phase	2022/Q4	NT$20 million
Next Generation Power HIL Testbed for EV Key components Testing	Design verification phase	2022/Q4	NT$15 million
Energy recycling battery module charge and discharge tester	Design verification phase	2022/Q4	NT$20 million
Energe Recycling and high power density DC Load	Design verification phase	2022/Q3	NT$10 million
Energe Recycling and high power density AC Load	Design verification phase	2022/Q4	NT$10 million
1U 3-channels high power density DC Source	Design planning phase	2023/Q2	NT$10 million
Bi-directional high power density DC Source	Design verification phase	2022/Q3	NT$24 million

(IV) Changes to local and overseas policies and laws that impact the Company’s financial operations, and response measures

No changes to local and overseas policies and laws have resulted in major impact to the

• 101 -

financial operations of The Company and its subsidiaries.

• (V) Changes to technology (including cyber security risk) and industry that impact the Company’s financial operations, and response measures

• The Company pays close attention to the latest cyber security threats, conducts annual organizational situation and risk management analysis, conducts inventory and risk assessment of information assets, applies information asset value identification techniques, plans, designs and upgrades appropriate software and hardware equipment resources according to risk levels, and improves operational processes and other countermeasures. For the industry-related technological changes, we respond to technological changes in the industry by developing testing solutions in the areas of High Performance Computing (HPC) chips, 5G, AIoT, biometric 3D sensors, electric vehicles, green technology, and the AR/VR headset metaverse to seize business opportunities and align with the market pulse to meet future growth and market demand. In order to keep pace with the changes in the product market and the needs of customers, we continue to develop new technologies and effectively use our capital to align with the trend of product development, so as to enhance the ability of advanced technology to maintain the competitiveness of the Company and control the impact on the Company's finance and operations

• (VI) Changes to the corporate image that impact the Company’s risk management, and response measures

• The Company and its subsidiaries enjoy good business images and would not be subject to changes that negatively affect their corporate images.

• (VII)Expected benefits and possible risks of mergers and response measures

• In consideration of the enhancement to the Company’s product strategy and competitiveness, the Company’s Board of Directors approved a resolution on December 23, 2020, to invest in ENVIRONMENTAL STRESS SYSTEMS, INC. and acquire 100% of the equity. ESS is a supplier of Thermal Platforms, Space Simulation, Cascade Condensers, and Liquid Recirculating Chillers with high power, very low temperature cooling technology to meet the needs of emerging applications. The combination of its technology capabilities and the Company's products will expand the market for semiconductor test applications such as aerospace, electric/self-driving vehicles, 5G, AIoT, and biomedical testing equipment, which will contribute to future growth.

• (VIII) Expected benefits and possible risks of expanding factory buildings and response risks Factory building expansions allow the Company and its subsidiaries to increase its productivity, gain the ability to receive more purchase orders, improve revenue and profitability, and increase market share. Factory building expansion undertaken by the Company and its subsidiaries have been carefully reviewed to ensure that customers’ requirements are met while achieving optimal use of corporate capital.

• (IX) Risks resulting from the consolidation of purchasing or sales operations and response measures

• Purchasing risks

  • The Company and its subsidiaries in 2020 and 2021 accounted for 30.96% and 30.05%, respectively, of each year's purchases from NMC. The purchases were concentrated in the same group, mainly due to the special material products such as gold wire and copper wire provided by NMC. Compared with other Japanese and Korean manufacturers such as Tanaka, NKE, and Heesung, the quality is the best, and it meets the quality requirements of downstream semiconductor packaging customers. Since its establishment in 2006, the subsidiary, Chroma New Material Corporation, had been acting as an agency for NMC, Japan to sell special materials such as gold and copper wires for semiconductor packaging, leading the Company to enter the semiconductor industry. In recent years, the Company's revenue in the field of semiconductor test instruments has been growing year by year, and its phased mission has been completed. The Company's Board of Directors meeting on January 11, 2022 approved the termination of the agency business of NMC

• 102 -

to focus on the test instrument business. The operating revenue of Chroma New Material Corporation accounted for 16% of the Company's consolidated revenue and the net profit after tax accounted for 1% and 0.8% of the consolidated net profit after tax in 2020 and 2021, respectively, which had little impact on the Consolidated Company's profitability. The amount of purchases made from various suppliers by the Company and its subsidiaries may increase or decrease in response to changes in profitability of relevant products. Given the large variety of raw materials and components needed by the Company and its subsidiaries to produce their products, all local and overseas purchases are handled by a single purchasing unit. Where possible, two or more suppliers are selected to ensure supplier replaceability, acquire competitive pricing, spread purchasing risks, achieve reasonable cost reductions, and provide better services. Also, The Company and its subsidiaries have established positive partnerships with external suppliers to eliminate any concerns of material shortage. Material preparation for automated conveying and engineering equipment of The Company and its subsidiaries would only be initiated after receiving a purchase order to establish inventory levels for raw materials. Positive relationships have been established with upstream suppliers to reduce purchasing risks. The Company and its subsidiaries have been cooperating with major suppliers for a long period of time and there is a good understanding of cooperation between the two parties, and no significant abnormalities are found.

1. Sales risks

   • The Company and its subsidiaries offer a large variety of product categories. Product sales are mainly based upon the state of the industry, customer requirements, as well as changes to marketing strategies adopted by The Company and its subsidiaries. Hence, The Company and its subsidiaries are actively developing new customers to achieve business stability and growth. Currently, most customers are listed corporations or renowned corporations in Taiwan and other countries. No single customer’s income in the last two years has exceeded 10% of the Group’s total income.

2. (X) Impacts, risks, and response measures resulting from major equity transfer or replacement of directors, supervisors, or shareholders holding more than 10% of the Company's shares

3. In 2021 and as of the publication date of the annual report, the Company and its subsidiaries did not have directors, supervisors or major shareholders holding more than 10% of the shares transferred or replaced in large quantities.

4. (XI) Impact, risk, and response measures related to any change in governance rights in the Company

5. The Company and its subsidiaries did not undertake any major change to its governance team and did not undertake any major change to business strategies or guidelines. Hence, The Company and its subsidiaries did not experience any changes in their governance rights.

6. (XII) If there has been any substantial impact upon shareholders' equity or prices for the Company's securities as a result of any litigation, non-litigious proceeding, or administrative dispute involving the Company that was finalized or remained pending, the facts in dispute, amount in dispute, commencement date, main parties involved, and current status of the case up to the publication date of this annual report shall be disclosed MAS Automation Corp. (MAS), a subsidiary of the Company, entered into an equipment sale and purchase agreement with Linco Technology Co., Ltd. (Linco) in 2017 to manufacture a set of equipment entrusted by MAS. Still, Linco did not deliver a large number of critical parts and refused to cooperate during the installation. MAS, therefore, claimed against Linco a default payment of NT$2,503,659 thousand (approximately US$83,455 thousand) for the delay. On November 12, 2018, MAS filed a lawsuit against Linco for NT$440,000 thousand and reserved the right to seek future compensation for the rest amount. In order to protect the rights and interests of MAS Automation, it filed a provisional attachment against LINCO to the court and provided a court guarantee of NT$440,000. However, LINCO claimed that MAS Automation owed the balance of the

7. 103 -

contract and breached its commitments. On October 30, 2019, it filed a lawsuit requesting MAS Automation for compensation of NT$255,640 thousand (approximately USD 8.24 million) and interest. The dispute settlement procedure has been carried out, and is in the stage of evidence investigation. The case has not yet been closed; LINCO also requests MAS Automation to compensate LINCO for at least NT$505,521 thousand in losses due to the provisional attachment against LINCO. The case was heard, in turn, by the Taichung District Court and the Taichung Branch of the Taiwan High Court, which ruled in favor of MAS Automation on all counts; however, LINCO appealed the verdict to the Supreme Court on June 9, 2021, and the case is still pending before the Supreme Court.

(XIII) Other material risks and response measures: None.

1. Organizational context and risk management

   • (1) Risk management organization: The highest-ranking officers at various business units and centers are responsible for promoting organizational context and stakeholder needs and expectation analyses, risk identification, and assessment, as well as handling and communicating organizational context and stakeholder needs and expectation analyses.

2. (2) Information Security Risk Management and Response Measures (On-going Operation Risk Management and Response Measures)

    - The Company assesses that it will not pay for insurance information security insurance for the time being. But it has taken relative actions in response to information security, such as: for confidential data, introducing appropriate encryption mechanisms or endpoint protection measures to reduce the risk of data leakage; some colleagues’ operating environment uses a virtual desktop environment to centralize the operating system and data in the computer room host to improve security; for Internet and email virus threats, advanced continuous threat defense technology is used to strengthen the protection of email and Internet access to avoid any third-party threats; the Company’s internal network has an advanced threat protection mechanism to monitor the communication protocols of all network ports while monitoring and detecting and responding to targeted attacks spreading internally, externally, and horizontally, ensuring the Company’s internet security. New employees are provided with basic information security-related training when entering the job. Information security advocacy and education training are also conducted regularly to enhance colleagues' information security awareness. The information Division constantly follows the latest security threats. Every year, the Division analyzes organizational context and risk management, and performs operational risk impact analysis using an information risk analysis map. In addition, the Division carries out design planning and increases appropriate software and hardware equipment resources based on risk level, in order to improve response measures such as operating procedures.
   

With regard to abnormal disasters that may happen to equipment and host machines in machine rooms, the Company monitors the environment of machine rooms regularly, and conducts various simulation tests and emergency drills in machine rooms in order to ensure the normal operation of various facilities and information systems in machine rooms, to prevent the risks of various disasters or human errors without warning.

VII. Other important matters: None

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Chapter 8 Special Notes

I. Information on affiliated companies

• (I) Consolidated business report

As of December 31, 2021

1.Diagram of affiliated companies

Chroma ATE Co.,	Chroma ATE Europe B.V. shareholding percentage: 100% Chroma Investment Co., Ltd. Shareholding percentage: 100% MAS Automation Corp. shareholding percentage: 100% San Eagle Development Corp. shareholding percentage: 100% Chroma Japan Corp. Shareholding percentage: 100% Chen Hwa Technology Inc. Shareholding percentage: 100% Chroma New Material Corporation Shareholding percentage: 100% Testar Electronic Corporation Shareholding percentage: 67.2% Sensational Holdings Ltd. Shareholding percentage: 100% CHI Incorporation Ltd. Shareholding percentage: 100% Deep Red Holding Co.,Ltd. Shareholding percentage: 100% Adivic Technology Co. Shareholding percentage: 74.1% EVT Technology Co., Ltd. Shareholding percentage: 85.6% Chroma Systems Solutions, Inc. Shareholding percentage: 25% Neworld Electronics Limited Shareholding percentage: 100% Chroma ATE Inc. Shareholding percentage: 100% Quantel Private Ltd. Shareholding percentage: 60% Innovative Nanotech Incorporated shareholding percentage: 67.2% Touch Cloud Inc. Shareholding percentage: 83.1%	Neworld Electronics Limited Shhldi t 100%			Chroma Electronics (Shenzhen) Co., Ltd. shareholding percentage: 100% Chroma Electronics (Shanghai) Co., Ltd. shareholding percentage: 100%	Chroma Electronics (Shenzhen) Co., Ltd. shareholding percentage: 100% Chroma Electronics (Shanghai) Co., Ltd. shareholding percentage: 100%	Chroma Electronics (Shenzhen) Co., Ltd. shareholding percentage: 100%		Wei Kuang Automatic Equipment (Nanjin) Co., Ltd. shareholding percentage: 100% Wei Kuang Automatic Equipment (Xiamen) Co., Ltd. shareholding percentage: 100% Mou Kuan Technologies (Nanjin) Co., Ltd. shareholding percentage: 100%
		areong percenage:
		Chroma ATE Inc. Shareholding percentage: 100%
		Chroma New Material Corporation Shareholding percentage: 100%
		Chroma ATE Europe B.V. shareholding percentage: 100%					Chroma Germany GmbH Shareholding percentage: 100%
		Chroma Investment Co., Ltd. Shareholding percentage: 100%	Shareholding percentage: 50%
		Chroma Japan Corp. Shareholding percentage: 100%
		Sensational Holdings Ltd. Shareholding percentage: 100%
		Chroma Systems Solutions, Inc. Shareholding percentage: 25%
		Testar Electronic Corporation Shareholding percentage: 67.2%
		CHI Incorporation Ltd. Shareholding percentage: 100%					Chroma ATE (Suzhou) Co., Ltd. Shareholding percentage: 100%
					Chroma (Shanghai) Trading Co., Ltd. shareholding percentage:100%
		Chen Hwa Technology Inc. Shareholding percentage: 100%					Chroma (Shanghai) Trading Co., Ltd. shareholding percentage:100%
		San Eagle Development Corp. shareholding percentage: 100%					Wei Kuang Mech Eng Inc. Shareholding percentage: 100%
					Sajet System Technology (Suzhou) Co., Ltd. shareholding percentage: 100% Adivic Holding Corporation Shareholding percentage: 100% Quantel Global Vietnam Co., Ltd. shareholding percentage: 100% Quantel Technologies India Private Limited shareholding percentage: 100% Quantel Global Sdn. Bhd. Shareholding percentage: 100% Quantel Global Philippines Corporation shareholding percentage: 100% Quantel Global Company Limited shareholding percentage: 99.9%
							Quantel Global Company Limited shareholding percentage: 99.9%

• 105 -

2.Basic information of various related corporation

December 31, 2021 (Unit: In thousands of NT$ or foreign currency)

Name of enterprise	Date of establishment	Address	Paid-in capital	Primary business or production items
Neworld Electronics Limited	1994.02.17	Unit 606, 6F, Shui Hing Centre, No.13, Sheung Yuet Rd., Kowloon Bay, Kowloon, H.K.	HK$ 64,013	Sales and service of electronic measurement instruments, etc.
Chroma Electronics (Shenzhen) Co., Ltd.	1998.03.10	8F, No.4, Nanyou Tian An Industrial Estate, Shenzhen, China	HK$30,000	Sales of computerized automation and peripheral equipment as well as electronic measurement instruments
Chroma Electronics (Shanghai) Co., Ltd.	2000.11.10	3F Building 40, No.333, Qin Jiang Rd., Shanghai, China	US$3,000	Sales of computerized automation and peripheral equipment as well as electronic measurement instruments
Chroma ATE Inc.	1993.02.18	7 Chrysler Irvine CA92618	US$1,000	Sales and service of electronic measurement instruments,etc.
Chroma ATE Europe B.V.	1999.09.17	Morsestraat 32,6716 AH Ede, The Netherlands	EUR$45	Sales and service of electronic measurement instruments,etc.
Chroma Germany GmbH	2017.09.04	Südtiroler Str. 9 86165 Augsburg Germany	EUR$30	Sales and service of electronic measurement instruments,etc.
Chroma Investment Co., Ltd.	1997.01.14	15F, No. 88, Wenmao Rd., Guishan Dist., Taoyuan City,Taiwan	NT$140,000	General Investment
Chroma New Material Corporation	2006.08.11	1F, No. 68, Huaya 1st Road, Guishan District,Taoyuan City	NT$250,000	Processing and sale of gold wire
Testar Electronic Corporation	2007.03.09	3F, No. 68, Huaya 1st Road, Guishan District,Taoyuan City	NT$300,000	Testing of LED products
Sensational Holdings Ltd.	1997.07.11	Citco Buildings P.O. Box 662, Road Town, Tortola,British Virgin Island	US$1,200	General Investment
Chroma Systems Solutions, Inc.	2001.04.01	19772 Pauling, Foothill Ranch, CA 92610	US$5	Sales and service of electronic measurement instruments,etc.
CHI Incorporation Ltd.	1998.04.03	P.O. Box 957 Offshore Incorporations Centre, Road Town, Tortola, British Virgin Islands	US$3,830	Inductance, capacitance, and resistance testing and component trading
Chroma ATE (Suzhou) Co., Ltd.	2006.03.15	Building 7, No.855, Zhujiang Rd., Suzhou New District, Jiang Su, China	US$3,800	Sales of computerized automation and peripheral equipment as well as electronic measurement instruments
Chen Hwa Technology Inc.	1998.04.03	P.O. Box 957 Offshore Incorporations Centre, Road Town, Tortola, British Virgin Islands	US$3,085	Inductance, capacitance, and resistance testing and component trading
Chroma (Shanghai) Trading Co., Ltd.	2004.01.05	Rm 1102B, Building 1, No.18, Tai Gu Rd., Waigaoqiao Free Trade Zone, Shanghai	US$2,700	International trade, intermediary trade, simple processing for trade purposes, and trade inquiryservices.
San Eagle Development Corp.	2006.07.04	Drake Chambers, Road Town, Tortola, British Virgin Islands	US$2,050	General Investment
Wei Kuang Mech Eng Inc.	2002.01.10	608 St. James Court, St. Denis Street Port Louis, Mauritius	US$4,475	General Investment
Mou Kuan Technologies (Nanjin) Co., Ltd.	1997.09.27	128# Keyuan Road, Jiangning District, Nanjing City, China	RMB$1,737	Assembly, sale and maintenance of factory conveyors and related systems and renderingafter-sales services
Wei Kuang Automatic Equipment (Nanjin) Co., Ltd.	2005.06.30	128# Keyuan Road, Jiangning District, Nanjing City, China	RMB$11,871	Assembly, sales, and after-sales service of electronic production equipment system and transport system
Wei Kuang Automatic Equipment (Xiamen) Co., Ltd.	2007.02.01	Unit 101 & 102, No. 20, Jinhui Road, Houxi, Jimei District, Xiamen	RMB$11,417	Assembly, sales, and after-sales service of electronic production equipment system and transport system
MAS Automation Corp.	1975.11.26	No.6, Lane 17, Niupu S Rd., Hsinchu City, Taiwan	NT$100,000	Design, manufacturing, installment and testing of automated factory conveyor systems
Chroma Japan Corp.	2008.05.30	888 Nippa-cho, Kouhoku-ku, Yokohama- shi,Kanagawa,223-0057 Japan	JPY$99,500	Sales and service of electronic measurement instruments,etc.
Deep Red Holding Co., Ltd	2004.04.29	2F, Felix House,24 Dr. Joseph Riviere Street,Port Louis,Republic of Mauritius	US$215	General Investment
Sajet System Technology	2004.08.24	503-1,4th Floor GenwayLOHASTOWN,88	RMB$8,374	R&D and design of computer network

106

Name of enterprise	Date of establishment	Address	Paid-in capital	Primary business or production items
(Suzhou) Co., Ltd.		Building，999 Xinghu Road,SIP Suzhou		safety systems and data management systems
Adivic Technology Co.	2009.04.07	9F, No. 88, Wenmao Rd., Guishan Dist., Taoyuan City,Taiwan	NT$170,000	Sale and research of RF device
Adivic Holding Corp	2015.01.15	Offshore Chambers, P.O. Box 217, Apia, Samoa.	US$1,000	Sale and research of RF device
EVT Technology Co., Ltd.	1999.08.19	6F, No. 88, Wenmao Rd., Guishan Dist., Taoyuan City,Taiwan	NT$110,000	Manufacturing of vehicles and parts
Quantel Private Ltd.	1989.02.15	25 Kallang Ave #05-02 Singapore 339416	SG$3,190	Sales of testing and measurement instruments,etc.
Quantel Global Vietnam Co., Ltd	2017.01.03	Floor 10, CIC Tower lane 219 Trung Kinh, Yen Hoa,Cau Giay,Hanoi	VND4,526,506	Sales of testing and measurement instruments,etc.
Quantel Technologies India Private Limited	2016.10.05	326, 3rd Floor MGF Metropolis Sector-28 MG Roadgurgaon-122002 India	INR6,500	Sales of testing and measurement instruments,etc.
Quantel Global Sdn. Bhd.	2016.07.20	Unit 802, 8th Flr, Blk A Damansara Intan, No. 1 Jalan SS20/27, 47400, Petaling Jaya, Selangor,Malaysia	MYR600	Sales of testing and measurement instruments, etc.
Quantel Global Philippines Corporation	2017.07.24	Unit 2401-2402 The Orient Square Building, F. Ortigas Jr Rd. Ortigas Centre, PasigCityManila Philippines 1605	PHP9,910	Sales of testing and measurement instruments, etc.
Quantel Global Company Limited	2016.10.12	5th Flr, 2170 Bangkok Tower, New Petchburi Road, Bangkapi, Huaykwang, Bangkok 1031	THB750	Sales of testing and measurement instruments, etc.
Innovative Nanotech Incorporated	2017.08.09	5F, No. 6-2, Du Sing Rd, East District, Hsinchu City,Taiwan	NT$211,640	Nanoparticles monitoring equipment
Touch Cloud Inc.	2016.02.03	10F-4, No.148, Section 4, Zhongxiao East Road, Da’an District, Taipei City, Taiwan 106	NT$132,995	Cloud platform development and IoT system integration

• 3.Information of shareholders with corporate governance power while working in the Company: None.

• 4.Overall business scope of every related corporation

The overall business scope of every related corporation of the Company primarily focuses on specialized manufacturing services for measurement instruments. There is also a small number of related corporations that focus on investments in this scope of business. In general, specialization amongst related corporations focuse on mutual support in technology, production capacity, sales, and services to maximize synergy so that the Company can keep providing the best manufacturing services for professional measurement instruments to customers throughout the world and ensure the Company’s leadership in the global market.

1. Directors, supervisors, and presidents of Chroma ATE Inc. and affiliated companies

			December 31, 2021	December 31, 2021
Name of enterprise	Position title	Name or representative	Shares held
			Number of shares	Shareholding percentage
Neworld Electronics Limited	Director	Chroma ATE Inc. (representatives: Leo Huang and Ming Chang)	64,012,815 shares	100%
Chroma Electronics (Shenzhen) Co., Ltd.	Director Director Director President	Neworld Electronics Limited (representative: Leo Huang) Vincent Chen Emma Chen LeoHuang	(Note 1) - - -	100% - - -
Chroma Electronics (Shanghai) Co., Ltd.	Director Director Director Supervisor President	Neworld Electronics Limited (representative: Leo Huang) Paul Ying Vincent Chen Amy Huang Paul Ying	(Note 1) - - - -	100% - - - -
Chroma ATE Inc.	Director Director	I-Shih Tseng ChengYing	Chroma holds 1,000,000 shares	100%

107

Name of enterprise	Position title	Name or representative	Shares held	Shares held
			Number of shares	Shareholding percentage
	Director	Yi-Shen Wang
Chroma ATE Europe B.V.	Director	Chroma ATE Inc. (representatives: David Yang, Paul Ying, andI-Shih Tseng)	1,000 shares	100%
Chroma Germany GmbH	Director	Chroma ATE Europe BV (representative: Cheng Ying)	(Chroma BV holds 30,000 shares)	100%
Chroma Investment Co., Ltd.	Director Supervisor	Chroma ATE Inc. (representative: Leo Huang, Paul Ying, Ming Chang) ChromaATE Inc. (representative:AmyHuang)	14,000,000 shares	100%
Chroma New Material Corporation	Director Supervisor	Chroma ATE Inc. (representative: Leo Huang, I-Shih Tseng, Amy Huang) ChromaATE Inc. (representative:Paul Ying)	25,000,000 shares	100%
Testar Electronic Corporation	Director Supervisor President	Chroma ATE Inc. (representatives: Leo Huang, I- Shih Tseng, Tsun-I, Wang) Amy Huang Chih-Ming Chen	20,159,600 shares 1,000 shares 36,000 shares	67.2% - 0.1%
Sensational Holdings Ltd.	Director	Chroma ATE Inc. (representative: Leo Huang)	1,200,000 shares	100%
Chroma Systems Solutions , Inc.	Director Director Director	Fred Joseph Sabatine Cheng Ying Tai-Wei Yang	120,000 shares Chroma holds 120,000 shares Chroma USA holds 240,000 shares	25% 25% 50%
CHI Incorporation Ltd.	Director	Leo Huang	(Chroma holds 3,830,000 shares)	100%
Chroma ATE (Suzhou) Co., Ltd.	Director Director Director Supervisor CEO	CHI (representative: Leo Huang) Paul Ying Emma Chen Qin Wang LeoHuang	(Note 1) - - - -	100% - - - -
Chen Hwa Technology Inc.	Director	Leo Huang	(Chroma holds 3,085,000 shares)	100%
Chroma (Shanghai) Trading Co.,Ltd.	Director	Chen Hwa (representative: Leo Huang)	(Note 1)	100%
San Eagle Development Corp.	Director	Chroma ATE Inc. (representative: Leo Huang)	2,050,000 shares	100%
Wei Kuang Mech Eng Inc.	Director	San Eagle (representative: Leo Huang)	4,475,000 shares	100%
Mou Kuan Technologies (Nanjin) Co., Ltd.	Director Director Director	Wei Kuang (representative: Leo Huang) Chin-Fu Huang AmyHuang	(Note 1) - -	100% - -
Wei Kuang Automatic Equipment (Nanjin) Co., Ltd.	Director Director Director	Wei Kuang (representative: Leo Huang) Chin-Fu Huang AmyHuang	(Note 1) - -	100% - -
Wei Kuang Automatic Equipment (Xiamen) Co., Ltd.	Director Director Director	Wei Kuang (representative: Leo Huang) Chin-Fu Huang AmyHuang	(Note 1) - -	100% - -
MAS Automation Corp.	Director Supervisor President	Chroma ATE Inc. (representative: Leo Huang, Jin-Fu, Huang, I-Shih Tseng) Chroma ATE Inc. (representative: Amy Huang) Chin-FuHuang	10,000,000 shares -	100% -
Chroma Japan Corp.	Director	Leo Huang	(Chroma holds 9,975 shares)	100%
Deep Red Holding Co., Ltd	Director	Leo Huang	(Chroma holds 215,000 shares)	100%
Sajet System Technology (Suzhou) Co., Ltd.	Director Director Director Supervisor	Deep Red Holding (representative: Joe Lin) Arno Wu Paul Ying AmyHuang	(Note 1) - - -	100% - - -

108

Name of enterprise	Position title	Name or representative	Shares held	Shares held
			Number of shares	Shareholding percentage
	President	JoeLin	-	-
Adivic Technology Co.	Director Director Supervisor President	Chroma ATE Inc. (representative: I-Shih Tseng, Leo Huang) AIT group (representative: Michael Sheu) Amy Huang Jason Huang	12,590,000 shares 4,410,000 shares - -	74.1% 25.9% - -
Adivic Holding Corporation	Director	Adivic Technology (representative: I-Shih Tseng)	1,000,000 shares	100%
EVT Technology Co., Ltd.	Director Director Director Supervisor President	Leo Huang Joey Chang Tsun-I Wang Chroma ATE Inc. (representative: Paul Ying) LeoHuang	54,023 shares 1,339 shares 34,838 shares 9,412,412 shares 54,023 shares	0.5% - 0.3% 85.6% 0.5%
Quantel Private Ltd.	Director Director	Chroma ATE Inc. (representative: Leo Huang, Paul Ying) YipHin Lay	1,914,000 shares 1,276,000 shares	60% 40%
Quantel Global Vietnam Co.,Ltd	Director	Phan Sy Dung	Quantel Private holds100%	100%
Quantel Technologies IndiaPvtLtd	Director	Yip Hin Lay	Quantel Private holds 64,999 shares	100%
Quantel Global Sdn. Bhd.	Director	Yip Hin Lay	Quantel Private holds 600,000 shares	100%
Quantel Global Philippines Corporation	Director	Yip Hin Lay	Quantel Private holds 99,095 shares	100%
Quantel Global Company Limited	Director	Yip Hin Lay	Quantel Private holds29,997 shares	99.9%
Innovative Nanotech Incorporated	Director Director Supervisor President	Chroma ATE Inc. (representative: Leo Huang, I-Shih Tseng) Research Industry (representative: Bruce Han) Amy Huang Bo-RenWu	14,214,000 shares 1,000,000 shares 100,000 shares 100,000 shares	67.2% 4.7% 0.5% 0.5%
Touch Cloud Inc.	Director Director Director supervisor	Chroma ATE Inc. (representative: Leo Huang) Kun-Shan Lu Cheng-Xun Li AmyHuang	11,045,667 shares - 669,814 shares -	83.1% - 5.0% -

Note 1: Limited liability Corporation

109

6. Business operating conditions of Chroma ATE Inc. and its related corporation

	December 31, 2021 Unit: In thousands of NT$ Paid-in capital Total assets Total liabilitiesNet worth Operatin g revenue for the period Operatin g profit for the period Profit or loss for the period (after tax) Earnings per share (NT$) (after tax) 227,181 2,180,507 442,747 1,737,760 2,640,765 (37,593) 197,341 3.08 106,470 1,882,667 562,382 1,320,285 2,422,654 161,371 108,981 Not applicable 83,040 539,775 148,581 391,194 1,108,273 139,798 95,798 Not applicable 27,680 1,134,711 864,913 269,798 1,682,943 (25,747) 105,486 105.49 133 1,084,565 511,730 572,835 1,247,311 298,502 265,558 Not applicable 140,000 587,171 1,620 585,551 - (167) 22,626 1.62 250,000 1,236,258 783,435 452,823 2,804,321 59,995 43,498 1.74 1,421 342,015 149,872 192,143 488,145 (307) 707 Not applicable 940 83,143 81,532 1,611 184,106 (6,168) 1,559 Not applicable 74,736 13,002 488 12,514 177 (693) (347) Not applicable 105,184 166,668 116,220 50,448 221,418 7,663 41,607 Not applicable 100,000 1,322,575 1,268,137 54,438 508,505 (241,442) (215,979) (21.60) 7,546 3,029 2 3,027 1,144 50 565 Not applicable 51,568 53,829 14,392 39,437 36,558 6,263 43,473 Not applicable 49,595 104,152 22,002 82,150 61,867 3,361 19,162 Not applicable 36,377 24,578 1,498 23,080 14,276 2,232 22,622 Not applicable 300,000 322,683 111,880 210,803 441,402 134,714 133,023 4.43 23,980 316,429 440,688 (124,259) 452,117 (26,109) (28,024) Not applicable 33,216 49,366 331 49,035 0 (856) (307) (0.26) 85,393 120,904 20 120,884 0 (990) 6,590 2.14 106,014 321,473 0 321,473 0 0 41,607 10.86 56,744 985,943 18 985,925 0 (135) 69,610 33.96 123,868 979,535 18 979,517 0 (128) 69,743 15.59 5,951 161,732 366 161,366 0 (2,048) 20,927 97.33 170,000 139,975 34,765 105,210 94,314 1,148 1,794 0.11 110,000 38,094 1,376 36,718 424 (11,525) (10,707) (0.97) 65,267 444,712 119,256 325,456 611,702 69,270 80,051 25.09 211,640 302,370 60,733 241,637 156,970 26,810 25,502 1.20 132,995 57,649 2,216 55,433 2,369 (17,016) (16,911) (1.27)	December 31, 2021 Unit: In thousands of NT$ Paid-in capital Total assets Total liabilitiesNet worth Operatin g revenue for the period Operatin g profit for the period Profit or loss for the period (after tax) Earnings per share (NT$) (after tax) 227,181 2,180,507 442,747 1,737,760 2,640,765 (37,593) 197,341 3.08 106,470 1,882,667 562,382 1,320,285 2,422,654 161,371 108,981 Not applicable 83,040 539,775 148,581 391,194 1,108,273 139,798 95,798 Not applicable 27,680 1,134,711 864,913 269,798 1,682,943 (25,747) 105,486 105.49 133 1,084,565 511,730 572,835 1,247,311 298,502 265,558 Not applicable 140,000 587,171 1,620 585,551 - (167) 22,626 1.62 250,000 1,236,258 783,435 452,823 2,804,321 59,995 43,498 1.74 1,421 342,015 149,872 192,143 488,145 (307) 707 Not applicable 940 83,143 81,532 1,611 184,106 (6,168) 1,559 Not applicable 74,736 13,002 488 12,514 177 (693) (347) Not applicable 105,184 166,668 116,220 50,448 221,418 7,663 41,607 Not applicable 100,000 1,322,575 1,268,137 54,438 508,505 (241,442) (215,979) (21.60) 7,546 3,029 2 3,027 1,144 50 565 Not applicable 51,568 53,829 14,392 39,437 36,558 6,263 43,473 Not applicable 49,595 104,152 22,002 82,150 61,867 3,361 19,162 Not applicable 36,377 24,578 1,498 23,080 14,276 2,232 22,622 Not applicable 300,000 322,683 111,880 210,803 441,402 134,714 133,023 4.43 23,980 316,429 440,688 (124,259) 452,117 (26,109) (28,024) Not applicable 33,216 49,366 331 49,035 0 (856) (307) (0.26) 85,393 120,904 20 120,884 0 (990) 6,590 2.14 106,014 321,473 0 321,473 0 0 41,607 10.86 56,744 985,943 18 985,925 0 (135) 69,610 33.96 123,868 979,535 18 979,517 0 (128) 69,743 15.59 5,951 161,732 366 161,366 0 (2,048) 20,927 97.33 170,000 139,975 34,765 105,210 94,314 1,148 1,794 0.11 110,000 38,094 1,376 36,718 424 (11,525) (10,707) (0.97) 65,267 444,712 119,256 325,456 611,702 69,270 80,051 25.09 211,640 302,370 60,733 241,637 156,970 26,810 25,502 1.20 132,995 57,649 2,216 55,433 2,369 (17,016) (16,911) (1.27)	December 31, 2021 Unit: In thousands of NT$ Paid-in capital Total assets Total liabilitiesNet worth Operatin g revenue for the period Operatin g profit for the period Profit or loss for the period (after tax) Earnings per share (NT$) (after tax) 227,181 2,180,507 442,747 1,737,760 2,640,765 (37,593) 197,341 3.08 106,470 1,882,667 562,382 1,320,285 2,422,654 161,371 108,981 Not applicable 83,040 539,775 148,581 391,194 1,108,273 139,798 95,798 Not applicable 27,680 1,134,711 864,913 269,798 1,682,943 (25,747) 105,486 105.49 133 1,084,565 511,730 572,835 1,247,311 298,502 265,558 Not applicable 140,000 587,171 1,620 585,551 - (167) 22,626 1.62 250,000 1,236,258 783,435 452,823 2,804,321 59,995 43,498 1.74 1,421 342,015 149,872 192,143 488,145 (307) 707 Not applicable 940 83,143 81,532 1,611 184,106 (6,168) 1,559 Not applicable 74,736 13,002 488 12,514 177 (693) (347) Not applicable 105,184 166,668 116,220 50,448 221,418 7,663 41,607 Not applicable 100,000 1,322,575 1,268,137 54,438 508,505 (241,442) (215,979) (21.60) 7,546 3,029 2 3,027 1,144 50 565 Not applicable 51,568 53,829 14,392 39,437 36,558 6,263 43,473 Not applicable 49,595 104,152 22,002 82,150 61,867 3,361 19,162 Not applicable 36,377 24,578 1,498 23,080 14,276 2,232 22,622 Not applicable 300,000 322,683 111,880 210,803 441,402 134,714 133,023 4.43 23,980 316,429 440,688 (124,259) 452,117 (26,109) (28,024) Not applicable 33,216 49,366 331 49,035 0 (856) (307) (0.26) 85,393 120,904 20 120,884 0 (990) 6,590 2.14 106,014 321,473 0 321,473 0 0 41,607 10.86 56,744 985,943 18 985,925 0 (135) 69,610 33.96 123,868 979,535 18 979,517 0 (128) 69,743 15.59 5,951 161,732 366 161,366 0 (2,048) 20,927 97.33 170,000 139,975 34,765 105,210 94,314 1,148 1,794 0.11 110,000 38,094 1,376 36,718 424 (11,525) (10,707) (0.97) 65,267 444,712 119,256 325,456 611,702 69,270 80,051 25.09 211,640 302,370 60,733 241,637 156,970 26,810 25,502 1.20 132,995 57,649 2,216 55,433 2,369 (17,016) (16,911) (1.27)	December 31, 2021 Unit: In thousands of NT$ Paid-in capital Total assets Total liabilitiesNet worth Operatin g revenue for the period Operatin g profit for the period Profit or loss for the period (after tax) Earnings per share (NT$) (after tax) 227,181 2,180,507 442,747 1,737,760 2,640,765 (37,593) 197,341 3.08 106,470 1,882,667 562,382 1,320,285 2,422,654 161,371 108,981 Not applicable 83,040 539,775 148,581 391,194 1,108,273 139,798 95,798 Not applicable 27,680 1,134,711 864,913 269,798 1,682,943 (25,747) 105,486 105.49 133 1,084,565 511,730 572,835 1,247,311 298,502 265,558 Not applicable 140,000 587,171 1,620 585,551 - (167) 22,626 1.62 250,000 1,236,258 783,435 452,823 2,804,321 59,995 43,498 1.74 1,421 342,015 149,872 192,143 488,145 (307) 707 Not applicable 940 83,143 81,532 1,611 184,106 (6,168) 1,559 Not applicable 74,736 13,002 488 12,514 177 (693) (347) Not applicable 105,184 166,668 116,220 50,448 221,418 7,663 41,607 Not applicable 100,000 1,322,575 1,268,137 54,438 508,505 (241,442) (215,979) (21.60) 7,546 3,029 2 3,027 1,144 50 565 Not applicable 51,568 53,829 14,392 39,437 36,558 6,263 43,473 Not applicable 49,595 104,152 22,002 82,150 61,867 3,361 19,162 Not applicable 36,377 24,578 1,498 23,080 14,276 2,232 22,622 Not applicable 300,000 322,683 111,880 210,803 441,402 134,714 133,023 4.43 23,980 316,429 440,688 (124,259) 452,117 (26,109) (28,024) Not applicable 33,216 49,366 331 49,035 0 (856) (307) (0.26) 85,393 120,904 20 120,884 0 (990) 6,590 2.14 106,014 321,473 0 321,473 0 0 41,607 10.86 56,744 985,943 18 985,925 0 (135) 69,610 33.96 123,868 979,535 18 979,517 0 (128) 69,743 15.59 5,951 161,732 366 161,366 0 (2,048) 20,927 97.33 170,000 139,975 34,765 105,210 94,314 1,148 1,794 0.11 110,000 38,094 1,376 36,718 424 (11,525) (10,707) (0.97) 65,267 444,712 119,256 325,456 611,702 69,270 80,051 25.09 211,640 302,370 60,733 241,637 156,970 26,810 25,502 1.20 132,995 57,649 2,216 55,433 2,369 (17,016) (16,911) (1.27)	December 31, 2021 Unit: In thousands of NT$ Paid-in capital Total assets Total liabilitiesNet worth Operatin g revenue for the period Operatin g profit for the period Profit or loss for the period (after tax) Earnings per share (NT$) (after tax) 227,181 2,180,507 442,747 1,737,760 2,640,765 (37,593) 197,341 3.08 106,470 1,882,667 562,382 1,320,285 2,422,654 161,371 108,981 Not applicable 83,040 539,775 148,581 391,194 1,108,273 139,798 95,798 Not applicable 27,680 1,134,711 864,913 269,798 1,682,943 (25,747) 105,486 105.49 133 1,084,565 511,730 572,835 1,247,311 298,502 265,558 Not applicable 140,000 587,171 1,620 585,551 - (167) 22,626 1.62 250,000 1,236,258 783,435 452,823 2,804,321 59,995 43,498 1.74 1,421 342,015 149,872 192,143 488,145 (307) 707 Not applicable 940 83,143 81,532 1,611 184,106 (6,168) 1,559 Not applicable 74,736 13,002 488 12,514 177 (693) (347) Not applicable 105,184 166,668 116,220 50,448 221,418 7,663 41,607 Not applicable 100,000 1,322,575 1,268,137 54,438 508,505 (241,442) (215,979) (21.60) 7,546 3,029 2 3,027 1,144 50 565 Not applicable 51,568 53,829 14,392 39,437 36,558 6,263 43,473 Not applicable 49,595 104,152 22,002 82,150 61,867 3,361 19,162 Not applicable 36,377 24,578 1,498 23,080 14,276 2,232 22,622 Not applicable 300,000 322,683 111,880 210,803 441,402 134,714 133,023 4.43 23,980 316,429 440,688 (124,259) 452,117 (26,109) (28,024) Not applicable 33,216 49,366 331 49,035 0 (856) (307) (0.26) 85,393 120,904 20 120,884 0 (990) 6,590 2.14 106,014 321,473 0 321,473 0 0 41,607 10.86 56,744 985,943 18 985,925 0 (135) 69,610 33.96 123,868 979,535 18 979,517 0 (128) 69,743 15.59 5,951 161,732 366 161,366 0 (2,048) 20,927 97.33 170,000 139,975 34,765 105,210 94,314 1,148 1,794 0.11 110,000 38,094 1,376 36,718 424 (11,525) (10,707) (0.97) 65,267 444,712 119,256 325,456 611,702 69,270 80,051 25.09 211,640 302,370 60,733 241,637 156,970 26,810 25,502 1.20 132,995 57,649 2,216 55,433 2,369 (17,016) (16,911) (1.27)	December 31, 2021 Unit: In thousands of NT$ Paid-in capital Total assets Total liabilitiesNet worth Operatin g revenue for the period Operatin g profit for the period Profit or loss for the period (after tax) Earnings per share (NT$) (after tax) 227,181 2,180,507 442,747 1,737,760 2,640,765 (37,593) 197,341 3.08 106,470 1,882,667 562,382 1,320,285 2,422,654 161,371 108,981 Not applicable 83,040 539,775 148,581 391,194 1,108,273 139,798 95,798 Not applicable 27,680 1,134,711 864,913 269,798 1,682,943 (25,747) 105,486 105.49 133 1,084,565 511,730 572,835 1,247,311 298,502 265,558 Not applicable 140,000 587,171 1,620 585,551 - (167) 22,626 1.62 250,000 1,236,258 783,435 452,823 2,804,321 59,995 43,498 1.74 1,421 342,015 149,872 192,143 488,145 (307) 707 Not applicable 940 83,143 81,532 1,611 184,106 (6,168) 1,559 Not applicable 74,736 13,002 488 12,514 177 (693) (347) Not applicable 105,184 166,668 116,220 50,448 221,418 7,663 41,607 Not applicable 100,000 1,322,575 1,268,137 54,438 508,505 (241,442) (215,979) (21.60) 7,546 3,029 2 3,027 1,144 50 565 Not applicable 51,568 53,829 14,392 39,437 36,558 6,263 43,473 Not applicable 49,595 104,152 22,002 82,150 61,867 3,361 19,162 Not applicable 36,377 24,578 1,498 23,080 14,276 2,232 22,622 Not applicable 300,000 322,683 111,880 210,803 441,402 134,714 133,023 4.43 23,980 316,429 440,688 (124,259) 452,117 (26,109) (28,024) Not applicable 33,216 49,366 331 49,035 0 (856) (307) (0.26) 85,393 120,904 20 120,884 0 (990) 6,590 2.14 106,014 321,473 0 321,473 0 0 41,607 10.86 56,744 985,943 18 985,925 0 (135) 69,610 33.96 123,868 979,535 18 979,517 0 (128) 69,743 15.59 5,951 161,732 366 161,366 0 (2,048) 20,927 97.33 170,000 139,975 34,765 105,210 94,314 1,148 1,794 0.11 110,000 38,094 1,376 36,718 424 (11,525) (10,707) (0.97) 65,267 444,712 119,256 325,456 611,702 69,270 80,051 25.09 211,640 302,370 60,733 241,637 156,970 26,810 25,502 1.20 132,995 57,649 2,216 55,433 2,369 (17,016) (16,911) (1.27)	December 31, 2021 Unit: In thousands of NT$ Paid-in capital Total assets Total liabilitiesNet worth Operatin g revenue for the period Operatin g profit for the period Profit or loss for the period (after tax) Earnings per share (NT$) (after tax) 227,181 2,180,507 442,747 1,737,760 2,640,765 (37,593) 197,341 3.08 106,470 1,882,667 562,382 1,320,285 2,422,654 161,371 108,981 Not applicable 83,040 539,775 148,581 391,194 1,108,273 139,798 95,798 Not applicable 27,680 1,134,711 864,913 269,798 1,682,943 (25,747) 105,486 105.49 133 1,084,565 511,730 572,835 1,247,311 298,502 265,558 Not applicable 140,000 587,171 1,620 585,551 - (167) 22,626 1.62 250,000 1,236,258 783,435 452,823 2,804,321 59,995 43,498 1.74 1,421 342,015 149,872 192,143 488,145 (307) 707 Not applicable 940 83,143 81,532 1,611 184,106 (6,168) 1,559 Not applicable 74,736 13,002 488 12,514 177 (693) (347) Not applicable 105,184 166,668 116,220 50,448 221,418 7,663 41,607 Not applicable 100,000 1,322,575 1,268,137 54,438 508,505 (241,442) (215,979) (21.60) 7,546 3,029 2 3,027 1,144 50 565 Not applicable 51,568 53,829 14,392 39,437 36,558 6,263 43,473 Not applicable 49,595 104,152 22,002 82,150 61,867 3,361 19,162 Not applicable 36,377 24,578 1,498 23,080 14,276 2,232 22,622 Not applicable 300,000 322,683 111,880 210,803 441,402 134,714 133,023 4.43 23,980 316,429 440,688 (124,259) 452,117 (26,109) (28,024) Not applicable 33,216 49,366 331 49,035 0 (856) (307) (0.26) 85,393 120,904 20 120,884 0 (990) 6,590 2.14 106,014 321,473 0 321,473 0 0 41,607 10.86 56,744 985,943 18 985,925 0 (135) 69,610 33.96 123,868 979,535 18 979,517 0 (128) 69,743 15.59 5,951 161,732 366 161,366 0 (2,048) 20,927 97.33 170,000 139,975 34,765 105,210 94,314 1,148 1,794 0.11 110,000 38,094 1,376 36,718 424 (11,525) (10,707) (0.97) 65,267 444,712 119,256 325,456 611,702 69,270 80,051 25.09 211,640 302,370 60,733 241,637 156,970 26,810 25,502 1.20 132,995 57,649 2,216 55,433 2,369 (17,016) (16,911) (1.27)	December 31, 2021 Unit: In thousands of NT$ Paid-in capital Total assets Total liabilitiesNet worth Operatin g revenue for the period Operatin g profit for the period Profit or loss for the period (after tax) Earnings per share (NT$) (after tax) 227,181 2,180,507 442,747 1,737,760 2,640,765 (37,593) 197,341 3.08 106,470 1,882,667 562,382 1,320,285 2,422,654 161,371 108,981 Not applicable 83,040 539,775 148,581 391,194 1,108,273 139,798 95,798 Not applicable 27,680 1,134,711 864,913 269,798 1,682,943 (25,747) 105,486 105.49 133 1,084,565 511,730 572,835 1,247,311 298,502 265,558 Not applicable 140,000 587,171 1,620 585,551 - (167) 22,626 1.62 250,000 1,236,258 783,435 452,823 2,804,321 59,995 43,498 1.74 1,421 342,015 149,872 192,143 488,145 (307) 707 Not applicable 940 83,143 81,532 1,611 184,106 (6,168) 1,559 Not applicable 74,736 13,002 488 12,514 177 (693) (347) Not applicable 105,184 166,668 116,220 50,448 221,418 7,663 41,607 Not applicable 100,000 1,322,575 1,268,137 54,438 508,505 (241,442) (215,979) (21.60) 7,546 3,029 2 3,027 1,144 50 565 Not applicable 51,568 53,829 14,392 39,437 36,558 6,263 43,473 Not applicable 49,595 104,152 22,002 82,150 61,867 3,361 19,162 Not applicable 36,377 24,578 1,498 23,080 14,276 2,232 22,622 Not applicable 300,000 322,683 111,880 210,803 441,402 134,714 133,023 4.43 23,980 316,429 440,688 (124,259) 452,117 (26,109) (28,024) Not applicable 33,216 49,366 331 49,035 0 (856) (307) (0.26) 85,393 120,904 20 120,884 0 (990) 6,590 2.14 106,014 321,473 0 321,473 0 0 41,607 10.86 56,744 985,943 18 985,925 0 (135) 69,610 33.96 123,868 979,535 18 979,517 0 (128) 69,743 15.59 5,951 161,732 366 161,366 0 (2,048) 20,927 97.33 170,000 139,975 34,765 105,210 94,314 1,148 1,794 0.11 110,000 38,094 1,376 36,718 424 (11,525) (10,707) (0.97) 65,267 444,712 119,256 325,456 611,702 69,270 80,051 25.09 211,640 302,370 60,733 241,637 156,970 26,810 25,502 1.20 132,995 57,649 2,216 55,433 2,369 (17,016) (16,911) (1.27)
Name of enterprise	Paid-in capital	Total assets	Total liabilities	Net worth	Operatin g revenue for the period	Operatin g profit for the period	Profit or loss for the period (after tax)	Earnings per share (NT$) (after tax)
Neworld Electronics Limited	227,181	2,180,507	442,747	1,737,760	2,640,765	(37,593)	197,341	3.08
Chroma Electronics (Shenzhen) Co., Ltd.	106,470	1,882,667	562,382	1,320,285	2,422,654	161,371	108,981	Not applicable
Chroma Electronics (Shanghai) Co., Ltd.	83,040	539,775	148,581	391,194	1,108,273	139,798	95,798	Not applicable
Chroma ATE Inc.	27,680	1,134,711	864,913	269,798	1,682,943	(25,747)	105,486	105.49
Chroma Systems Solutions, Inc.	133	1,084,565	511,730	572,835	1,247,311	298,502	265,558	Not applicable
Chroma Investment Co.,Ltd.	140,000	587,171	1,620	585,551	-	(167)	22,626	1.62
Chroma New Material Corporation	250,000	1,236,258	783,435	452,823	2,804,321	59,995	43,498	1.74
Chroma ATE Europe B.V.	1,421	342,015	149,872	192,143	488,145	(307)	707	Not applicable
Chroma Germany GmbH	940	83,143	81,532	1,611	184,106	(6,168)	1,559	Not applicable
Chroma (Shanghai) Trading Co., Ltd.	74,736	13,002	488	12,514	177	(693)	(347)	Not applicable
Chroma ATE (Suzhou) Co., Ltd.	105,184	166,668	116,220	50,448	221,418	7,663	41,607	Not applicable
MAS Automation Corp.	100,000	1,322,575	1,268,137	54,438	508,505	(241,442)	(215,979)	(21.60)
Mou Kuan Technologies (Nanjin) Co., Ltd.	7,546	3,029	2	3,027	1,144	50	565	Not applicable
Wei Kuang Automatic Equipment (Nanjin) Co., Ltd.	51,568	53,829	14,392	39,437	36,558	6,263	43,473	Not applicable
Wei Kuang Automatic Equipment (Xiamen) Co., Ltd.	49,595	104,152	22,002	82,150	61,867	3,361	19,162	Not applicable
Sajet System Technology (Suzhou) Co., Ltd.	36,377	24,578	1,498	23,080	14,276	2,232	22,622	Not applicable
Testar Electronic Corporation	300,000	322,683	111,880	210,803	441,402	134,714	133,023	4.43
Chroma Japan Corp.	23,980	316,429	440,688	(124,259)	452,117	(26,109)	(28,024)	Not applicable
Sensational Holdings Ltd.	33,216	49,366	331	49,035	0	(856)	(307)	(0.26)
Chen Hwa TechnologyInc.	85,393	120,904	20	120,884	0	(990)	6,590	2.14
CHI Incorporation Ltd.	106,014	321,473	0	321,473	0	0	41,607	10.86
San Eagle Development Corp.	56,744	985,943	18	985,925	0	(135)	69,610	33.96
Wei KuangMech.Eng.Inc.	123,868	979,535	18	979,517	0	(128)	69,743	15.59
DeepRed HoldingCo.,Ltd.	5,951	161,732	366	161,366	0	(2,048)	20,927	97.33
Adivic TechnologyCo.(Note 1)	170,000	139,975	34,765	105,210	94,314	1,148	1,794	0.11
EVT TechnologyCo.,Ltd.	110,000	38,094	1,376	36,718	424	(11,525)	(10,707)	(0.97)
Quantel Private Ltd.(Note 1)	65,267	444,712	119,256	325,456	611,702	69,270	80,051	25.09
Innovative Nanotech Incorporated	211,640	302,370	60,733	241,637	156,970	26,810	25,502	1.20
Touch Cloud Inc.	132,995	57,649	2,216	55,433	2,369	(17,016)	(16,911)	(1.27)

Note 1: Expressed with the consolidated financial statement.

Note 2: The following lists the exchange rates for the statement of assets and liabilities:

USD: NTD=1:27.680, HKD: NTD=1:3.549, EUR: NTD=1:31.320, RMB: NTD=1:4.344, JPY: NTD=1:0.241, SGD: NTD=1:20.46

The following lists the exchange rates for the profit and loss statement:

USD: NTD=1:28.009, HKD: NTD=1:3.603, EUR: NTD=1:33.160, RMB:NTD=1:4.341, JPY:NTD=1:0.255, SGD:NTD=1:20.850

110

• (II) Consolidated financial statements of affiliated companies For 2021 (from January 1 to December 31, 2021), the Company's entities that are required to be included in the consolidated financial statements of affiliated enterprises under the "Criteria Governing Preparation of Consolidated Business Report of Affiliated Enterprises, Consolidated Financial Statements of Affiliated Enterprises, and Affiliation Reports" are the same as those required to be included in the parent-subsidiary consolidated financial statements under the International Financial Reporting Standards 10. Moreover, the related information required to be disclosed for the consolidated financial statements of affiliated enterprises has been fully disclosed in the aforementioned parent-subsidiary consolidated financial statements. Consequently, a separate set of consolidated financial statements of affiliated enterprises is not prepared.

• (III) Affiliation report

According to Article 369-12 of the Company Act, separate affiliation reports were not required for subsidiaries of The Company that have not been publicly listed.

• II. Private placement of securities in the most recent year up to the publication date of this annual report: None.

III. Holding or disposition of the Company's shares by subsidiaries in the most recent year up to the publication date of this annual report

								Unit:Thousand NT$; shares; %	Unit:Thousand NT$; shares; %	Unit:Thousand NT$; shares; %	Unit:Thousand NT$; shares; %
Subsidiary Name	Paid-in capital	Capital Source	Shareholding of the Company	Date of acquisition or disposal	Number and amount of shares acquired	Number and amount of shares disposed	Investment Income or loss	Number and amount of shares held as of the publication date of the annual report (Note)	Status of pledge	Value of endorsements and guarantees provided to subsidiaries by the Company	Loans provided to subsidiaries by the Company
Chroma Investment Co., Ltd.	NT$140,000 thousand	Self Capital	100%	2021	0	0	0	1,805,579 shares NT$299,726 thousand	None	0	0
				In the current year up till the publication date of this report	0	0	0		None	0	0

Note: The holding amount is calculated based on the closing price of NT$166 on April 11, 2022.

IV. Other supplementary matters: None.

• V. Any event that results in substantial impact upon shareholders’ equity or prices of the Company’s securities as prescribed by Article 36, Paragraph 3, Subparagraph 2 of the Securities and Exchange Act that have occurred in the most recent year up to the publication date of this annual report: None.

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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 prepared a separate set of consolidated financial statements of affiliates.

Very truly yours,

CHROMA ATE INC.

LEO HUANG Chairman February 23, 2022

112

INDEPENDENT AUDITORS’ REPOR

The Board of Directors and Shareholders Chroma ATE Inc.

Opinion

We have audited the accompanying consolidated financial statements of Chroma ATE Inc. and its subsidiaries (collectively referred to as the “Group”), which comprise the consolidated balance sheets as of December 31, 2021 and 2020, and the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2021 and 2020, and its consolidated financial performance and its consolidated cash flows for the years then ended, in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission (FSC) of the Republic of China.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements for the year ended December 31, 2021. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, we do not provide a separate opinion on these matters.

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

Revenue Recognition

The main source of revenue of the Group is the sales of test instruments. Since the main contract condition with customers is delivery at the point of departure, the determination of the point of shipment is important for judging whether the obligations of delivery are satisfied and recognized sales revenue; thus, we identified the revenue recognition of contract with customers as a key audit matter.

Our audit procedures include 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 detailed testing on transactions, indentifying material terms and conditions in the contracts or orders, and checking the original documents such as the shipping documents and invoice to confirm the correctness of the identified performance obligations and the time of sales recognition.

113

We also considers 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.

114

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.

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

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

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

5. 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.

6. 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.

115

The engagement partners on the audit 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.

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CHROMA ATE INC. AND SUBSIDIARIES

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

ASSETS CURRENT ASSETS Cash and cash equivalents (Note 6) Financial assets at fair value through profit or loss - current (Note 7) Financial assets at amortized cost - current (Notes 9 and 30) Contract assets - current (Note 22) Notes receivable (Note 10) Trade receivables (Note 10) Trade receivables - related parties (Notes 10 and 29) Inventories (Note 11) Prepayments Other current assets (Note 29) Total current assets NON-CURRENT ASSETS Financial assets at fair value through profit or loss - non-current (Note 7) Financial assets at fair value through other comprehensive income - non-current (Note 8) Investments accounted for using the equity method (Note 13) Property, plant and equipment (Notes 14, 29 and 30) Right-of-use assets (Notes 15 and 29) Investment properties (Note 16) Goodwill (Note 17) Other intangible assets Deferred tax assets (Note 24) Prepayments for land and equipment Refundable deposits Non-current prepayments for investments Other non-current assets (Note 20) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Note 18) Contract liabilities - current (Notes 22 and 29) Notes payable Notes payable - related parties (Note 29) Trade payables Trade payables - related parties (Note 29) Other payables (Notes 19 and 29) Current tax liabilities Lease liabilities - current (Notes 15 and 29) Current portion of long-term borrowings (Notes 18 and 30) Other current liabilities Total current liabilities NON-CURRENT LIABILITIES Long-term borrowings (Notes 18 and 30) Deferred tax liabilities (Note 24) Lease liabilities - non-current (Notes 15 and 29) Net defined benefit liabilities (Note 20) Guarantee deposits received Other non-current liabilities Total non-current liabilities Total liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE CORPORATION (Note 21) Ordinary share capital Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Total retained earnings Other equity Treasury shares Total equity attributable to owners of the Corporation NON-CONTROLLING INTERESTS Total equity TOTAL		2021 Amount % $ 3,088,158 10 504,949 2 1,353,890 5 779,547 3 198,853 1 4,292,917 14 33,969 - 3,915,791 13 261,498 1 294,960 1 14,724,532 50 4,793 - 1,166,892 4 3,127,364 11 6,096,436 21 345,318 1 3,137,187 11 225,695 1 97,413 - 345,338 1 118,865 - 20,268 - 55,024 - 80,992 - 14,821,585 50 $ 29,546,117 100 $ 1,901,110 7 746,946 3 31,549 - 2,953 - 3,009,505 10 11,005 - 1,372,698 5 405,049 1 107,604 - 213,053 1 78,016 - 7,879,488 27 1,447,169 5 767,422 3 276,636 1 174,889 - 43,334 - 9,721 - 2,719,171 9 10,598,659 36 4,218,745 14 4,087,223 14 2,824,310 10 86,888 - 7,255,798 25 10,166,996 35 74,633 - (33,686) - 18,513,911 63 433,547 1 18,947,458 64 $ 29,546,117 100		2020
				Amount % $ 2,896,645 10 509,015 2 1,036,691 4 1,278,936 4 127,042 - 4,247,500 15 19,340 - 3,028,457 11 197,038 1 187,175 1 13,527,839 48 4,646 - 862,898 3 3,139,227 11 3,156,634 11 144,921 1 3,137,187 11 228,002 1 55,578 - 314,987 1 3,463,185 13 13,693 - - - 80,086 - 14,601,044 52 $ 28,128,883 100 $ 2,554,260 9 765,682 3 35,933 - 4,570 - 2,637,070 10 11,353 - 1,210,998 4 348,441 1 55,247 - 633,456 2 153,317 1 8,410,327 30 2,404,616 9 621,111 2 92,345 - 156,280 1 40,886 - 14,625 - 3,329,863 12 11,740,190 42 4,212,945 15 4,036,875 14 2,592,487 9 176,128 1 5,160,575 18 7,929,190 28 (82,101) - (33,686) - 16,063,223 57 325,470 1 16,388,693 58 $ 28,128,883 100

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

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

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

(Continued)

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

INCOME TAX EXPENSE (Note 24) NET PROFIT FOR THE YEAR 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 other comprehensive income Share of the other comprehensive loss of associates and joint ventures accounted for using the equity method Items that may be reclassified subsequently to profit or loss: Exchange differences on translating the financial statements of foreign operations Share of the other comprehensive loss of associates and joint ventures accounted for using the equity method Total other comprehensive income (loss) TOTAL COMPREHENSIVE INCOME NET PROFIT ATTRIBUTABLE TO: Owners of the Corporation Non-controlling interests COMPREHENSIVE INCOME ATTRIBUTABLE TO: Owners of the Corporation Non-controlling interests EARNINGS PER SHARE (NT$; Note 25) Basic Diluted		2021 Amount % $ 978,531 6 4,305,315 24 (40,175) - 298,132 2 (4,327) - (76,832) (1) (70,564) - 106,234 1 $ 4,411,549 25 $ 4,179,232 24 126,083 - $ 4,305,315 24 $ 4,294,625 24 116,924 1 $ 4,411,549 25 $ 9.96 $ 9.89		2020
				Amount % $ 648,050 4 2,380,957 15 (5,258) - 229,747 2 (504) - (9,764) - (136,084) (1) 78,137 1 $ 2,459,094 16 $ 2,323,776 15 57,181 - $ 2,380,957 15 $ 2,412,798 16 46,296 - $ 2,459,094 16 $ 5.56 $ 5.51

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

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CHROMA ATE INC. AND SUBSIDIARIES

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

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

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

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

CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments for: Depreciation expenses Amortization expenses Expected credit loss recognized on trade receivables Net loss (gain) on financial liabilities at fair value through profit or loss Finance costs Interest income Dividend income Compensation costs of share-based payment Share of profit of associates and joint ventures accounted for using the equity method Gain on disposal of property, plant and equipment, net Gain on disposal of investments accounted for using equity method Write-downs of inventories Realized gain on transactions with associates and joint ventures Net loss on foreign currency exchange Gain on sale and leaseback transactions Gain on lease modification Net changes in operating assets and liabilities Contract assets Notes receivable Trade receivables Inventories Prepayments Other current assets Contract liabilities Notes payable Trade payables Other payables Other current liabilities Net defined benefit liabilities Cash generated from operations Income tax paid Net cash generated from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Payments to acquire financial assets at fair value through other comprehensive income Proceeds from capital reduction of financial assets at fair value through other comprehensive income Increase in financial assets at amortized cost

2021 2020 $ 5,283,846 $ 3,029,007 572,034 428,009 22,035 11,225 291,032 244,174 2,211 (8,903) 44,738 58,811 (24,391) (16,843) (71,755) (21,730) 1,415 16,968 (304,129) (135,392) (1,585,428) (7,066) (2,684) (480) 11,835 46,444 (1) (5) 89,008 36,798 (154,510) - (671) - 183,958 (20,890) (71,811) 47,879 (440,983) 74,720 (1,059,965) (472,222) (37,294) 32,237 (100,528) 47,114 (18,736) (249,175) (6,001) (582) 700,694 58,538 180,730 (98,893) (75,301) 124,715 (21,566) (12,067) 3,407,782 3,212,391 (815,995) (497,845) 2,591,787 2,714,546 (15,750) (39,157) 9,660 - (380,584) (432,301) (Continued)

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

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

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

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CHROMA ATE INC. AND SUBSIDIARIES

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

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

• 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.

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• 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

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

• 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.

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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.

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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 group entity, 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 interst 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 noncontrolling 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.

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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

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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 a group entity 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.

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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 a group entity 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

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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

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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.

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• 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, 12month 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

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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-ofuse-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

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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.

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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.

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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

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

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7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

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

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

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

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

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10. NOTES RECEIVABLE AND TRADE RECEIVABLES

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

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

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

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

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11. INVENTORIES

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

Investor Investee Business The Corporation Neworld Electronics Limited Sale and maintenance of electronic test instruments, etc. Chroma New Material Corp. Processing and sale of gold wire Mas Automation Corp. Design, manufacturing, installment and testing of automated factory conveyor systems Chroma ATE Inc. Sale and maintenance of electronic test instruments, etc. Chroma Systems Solutions, Inc. Sale and maintenance of electronic test instruments, etc. Chroma ATE Europe B.V. Sale and maintenance of electronic test instruments, etc. Chroma Japan Corp. Sale and maintenance of electronic test instruments, etc. CHI Incorporation Ltd. Test of inductance, capacitance and resistance equipment and sale of parts Chen Hwa Technology Inc. Test of inductance, capacitance and resistance equipment and sale of parts San Eagle Development Corp. Investment Sensational Holdings Ltd. Investment Deep Red Holding Co., Ltd. Investment Testar Electronics Corporation Testing of LED Adivic Technology Co., Ltd. Sale and research of RF device Chroma Investment Co., Ltd. Investment Quantel Private Ltd. Sale and maintenance of test instruments, etc. EVT Technology Co., Ltd. Manufacturing of motorcycles and its parts Innovative Nanotech Incorporated Monitoring instruments of nanoparticles Touch Cloud Inc. Development of cloud platform and Internet of Things systems Neworld Electronics Limited Chroma Electronics (Shenzhen) Co., Ltd. Sale of computerized automatic test systems, peripherals and electronic test instruments Chroma Electronics (Shanghai) Co., Ltd. Sale of computerized automatic test systems, peripherals and electronic test instruments Chroma ATE Inc. Chroma Systems Solutions, Inc. Sale and maintenance of electronic test instruments, etc. Chen Hwa Technology Inc. Chroma (Shanghai) Trading Co., Ltd. International and transit trading, simple commercial processing, commercial consulting services, etc. CHI Incorporation Ltd. Chroma ATE (Suzhou) Co., Ltd. Sale of computerized automatic test systems, peripherals and electronic test instruments San Eagle Development Corp. Wei Kuang Mech. Eng. Inc. Investment

Percentage of Ownership as of December 31 2021 2020 Remark 100.0 100.0 100.0 100.0 Note 32 100.0 100.0 100.0 100.0 25.0 25.0 Note 1 100.0 100.0 100.0 100.0 Note 2 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 67.2 67.2 74.1 74.1 100.0 100.0 60.0 60.0 85.6 85.6 67.2 71.1 Note 3 83.1 78.1 Note 4 100.0 100.0 100.0 100.0 50.0 50.0 Note 1 100.0 100.0 100.0 100.0 100.0 100.0 (Continued)

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Investor Investee Business Wei Kuang Mech. Eng. Inc. Mou Kuan Technologies (Nanjin) Co., Ltd. Assembly, sale and maintenance of factory conveyors and related systems and rendering after-sales services Wei Kuang Automatic Equipment (Nanjin) Co., Ltd. Sale and maintenance of electronic equipment and factory conveyor systems Wei Kuang Automatic Equipment (Xiamen) Co., Ltd. Sale and maintenance of electronic equipment and factory conveyor systems Deep Red Holdings Co., Ltd. Saject System Technology (Suzhou) Co., Ltd. Research, development and design of computer network security systems and information management EVT Technology Co., Ltd. Wei Da Electric Vehicle Co., Ltd. Sale and lease of motorcycles Adivic Technology Co., Ltd. Adivic Holding Corporation Sale and research of RF device Quantel Private Ltd. Quantel Technologies India Private Ltd. Sale and maintenance of test instruments, etc. Quantel Global Vietnam Co., Ltd. Sale and maintenance of test instruments, etc. Quantel Global Sdn. Bhd. Sale and maintenance of test instruments, etc. Quantel Global Philippines Corporation Sale and maintenance of test instruments, etc. Quantel Global Company Limited Sale and maintenance of test instruments, etc. Chroma ATE Europe B.V. Chroma Germany GmbH Sale and maintenance of electronic test instruments, etc. Chroma Investment Co., Ltd. Testar Electronics Corporation Testing of LED

Percentage of Ownership as of December 31 2021 2020 Remark 100.0 100.0 Note 32 100.0 100.0 100.0 100.0 100.0 100.0 - - Note 5 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 99.9 - Note 6 100.0 100.0 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

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

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a. Investments in associates

Associates that are not individually material Adlink Technology Inc. Dynascan Technology Corp. Camtek Ltd.		December 31	December 31	December 31
		2021 Amount Percentage of Equity Interest (%) $ 284,189 11.2 152,662 27.3 2,674,510 17.8 $ 3,111,361		2020
				Amount Percentage of Equity Interest (%) $ 514,751 11.3 141,439 27.3 2,466,146 18.1 $ 3,122,336

The Group’s share of: Net profit Other comprehensive loss Total comprehensive income (loss) for the year	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 305,017 (74,891) $ 230,126	2020 $ 136,122 (136,588) $ (466)

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

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

Although the Corporation’s equity interest in Camtek Ltd. fell below 20% in 2020, after assessment the Corporation’s seats of directors in Camtek, it still have the significant influence, therefore Camtek, Ltd is still regarded as 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 defines 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.

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b. Investments in joint ventures

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

Aggregate information of joint ventures that are not individually material:

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

Cost Balance, January 1, 2020 Additions Disposals Reclassification Exchange differences Balance, December 31, 2020	Land $ 1,209,760 - - - (2,765) $ 1,206,995	Buildings $ 2,568,672 17,981 (45) 3,195 (8,428) $ 2,581,375	Machinery $ 803,326 38,712 (32,358) (7,631) (1,721) $ 800,328	Office Equipment Total $ 1,834,589 $ 6,416,347 129,896 186,589 (207,994) (240,397) 113,093 108,657 6,514 (6,400) $ 1,876,098 $ 6,464,796 (Continued)

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

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:

Buildings Primary buildings 15-51 years Mechanical and electrical equipment 5-20 years Clean room equipment 3-11 years Others 1-49 years Machinery 1-12 years Office equipment 1-10 years

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

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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 was $116,475 thousand and $103,734 thousand, and the total cash out flow 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

INVESTMENT PROPERTIES
Land		December 31
		2021 $ 3,137,187	2020 $ 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.

the fair value as appraised.
Fair value		December 31
		2021 $ 11,830,879	2020 $ 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

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

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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

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

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

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

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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 (the “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:

Present value of defined benefit obligation Fair value of plan assets Net defined benefit assets (reconized in other non-current assets) Net defined benefit liabilities Movements in net defined benefit liabilities were as follows: Present Value of the Defined Benefit Obligation Balance at January 1, 2020 $ 486,655 Current service cost 3,601 Net interest expense (income) 3,663		December 31
	2021 2020 $ 538,051 $ 496,002 (364,082) (339,722) 173,969 156,280 920 - $ 174,889 $ 156,280 Fair Value of the Plan Assets Net Defined Benefit Liabilities $(323,566) $ 163,089 - 3,601 (2,489) 1,174

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	Present Value	Present Value
	of the Defined		Fair Value of	Net Defined
	Benefit		the Plan	Benefit
	Obligation		Assets	Liabilities
Recognized in profit or loss		7,264	(2,489)	4,775
Remeasurement
Return on plan assets (excluding
amounts included in net interest)	$	-	$ (10,566)	$ (10,566)
Actuarial loss
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)		-	(4,327)	(4,327)
Actuarial loss
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.

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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:

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

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

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

21. EQUITY

• a. Ordinary share capital

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

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b. Capital surplus

Capital surplus
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 May be used to offset a deficit only Additional paid-in capital Share of changes in capital surplus of associates or joint ventures May not be used for any purpose Employee share options Employee restricted shares		December 31
		2021 $ 3,372,101 218,317 146,976 $ 341,296 8,533 - $ 4,087,223	2020 $ 3,331,004 210,193 146,976 $ 327,868 16,060 4,774 $ 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. 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.

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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 was 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:

Legal reserve Special reserve Reversal of special reserve Cash dividends	Appropriation of Earnings For Fiscal Year 2020 For Fiscal Year 2019 $ 231,823 $ 185,448 - 89,240 ( 89,240) - 1,897,175 1,265,000	Dividend Per Share (NT$)
		For Fiscal Year 2020 For Fiscal Year 2019 $ 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	Dividends Per
	of Earnings	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 the shareholder’s 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.

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e. Other equity items

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

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f. Non-controlling interests

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

reporting periods were as follows:
Number of shares held (in thousand shares) Carrying amount Market price		December 31
		2021 1,806 $ 33,686 $ 361,116	2020 1,806 $ 33,686 $ 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

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

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a. Contract balances

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

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

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b.Depreciation and amortization

An analysis of depreciation by function Operating costs Operating expenses An analysis of amortization by function Operating costs Operating expenses c. Employee benefits expense Short-term benefits Share-based payments Post-employment benefits Defined contribution plans Defined benefit plans (Note 20) Other employee benefits An analysis of employee benefits expense by function Operating costs Operating expenses	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
	2021 2020 $ 114,977 $ 80,065 457,057 347,944 $ 572,034 $ 428,009 $ 85 $ - 21,950 11,225 $ 22,035 $ 11,225 For the Year Ended December 31
		2021 $ 3,862,080 1,415 100,444 4,094 78,052 $ 4,046,085 $ 646,588 3,399,497 $ 4,046,085	2020 $ 3,269,024 16,968 99,034 4,775 58,776 $ 3,448,577 $ 418,257 3,030,320 $ 3,448,577

• d. Employees’ compensation and remuneration of directors

According to the Article of Incorporation of the Corporation, the Corporation accrued 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:

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

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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

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

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

Profit before tax Income tax expense calculated at the statutory rate Adjustment items in determining taxable income Tax-exempt income Others Unrecognized deductible differences Investment credits Loss carryforward Deductible temporary differences Other taxable items Land value incremental tax Income tax on unappropriated earnings Difference on basic tax payable Others Adjustments for prior years’ tax Temporary differences Others Income tax expense recognized in profit or loss	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 5,283,846 $ 1,206,760 (350,591) (9,437) (119,301) (23,256) 46,654 200,196 15,982 - 176 10,384 193 771 $ 978,531	2020 $ 3,029,007 $ 721,364 (25,157) 32,663 (81,554) (5,121) 34,600 - 15,222 990 77 (42,936) (2,646) 548 $ 648,050

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• 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 Unrealized intercompany gain $ 112,022 $ 16,560 $ - Loss carry forwards 63,876 7,607 (1,567) Inventory reserve 59,507 760 - Allowance for impaired receivables 27,067 5,650 (6) Tax credit 29,186 4,190 (869) Unrealized exchange loss 11,645 (2,748) - Gain on disposal of assets - 3,853 - Net defined benefit liability 3,775 (3,775) - Others 7,909 762 (66) $ 314,987 $ 32,859 $ (2,508) Deferred Tax Liabilities Opening Balance Recognized in Profit or Loss Exchange Differences and Other Unappropriated earnings of foreign subsidiaries $ 566,002 $ 135,236 $ - Goodwill 46,598 2,606 (377) Others 8,511 9,179 (333) $ 621,111 $ 147,021 $ (710) For the year ended December 31, 2020 Deferred Tax Assets Opening Balance Recognized in Profit or Loss Exchange Differences and Other Unrealized intercompany gain $ 120,426 $ (8,404) $ - Loss carry forwards 75,343 (8,568) (2,899) Inventory reserve 51,667 7,840 - Tax credit 24,298 6,333 (1,445) Allowance for impaired receivables 22,735 4,342 (10) Unrealized exchange loss 10,385 1,260 - Net defined benefit liability 6,203 (2,428) - Others 6,512 2,114 (717) $ 317,569 $ 2,489 $ (5,071)

Closing Balance $ 128,582 69,916 60,267 32,711 32,507 8,897 3,853 - 8,605 $ 345,338 Closing Balance $ 701,238 48,827 17,357 $ 767,422 Closing Balance $ 112,022 63,876 59,507 29,186 27,067 11,645 3,775 7,909 $ 314,987

Deferred Tax Assets Unrealized intercompany gain Loss carry forwards Inventory reserve Tax credit Allowance for impaired receivables Unrealized exchange loss Net defined benefit liability Others

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Deferred Tax Liabilities Unappropriated earnings of foreign subsidiaries Goodwill Others	Opening Balance Recognized in Profit or Loss Exchange Differences and Other $ 445,017 $ 120,985 $ - 32,570 15,604 (1,576) 6,560 1,930 21 $ 484,147 $ 138,519 $ (1,555)	Closing Balance $ 566,002 46,598 8,511 $ 621,111

c. Information about unused loss carryforwards

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

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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

Earnings used in the computation of basic and diluted earnings per share		For the Year Ended December 31	For the Year Ended December 31
		2021 $ 4,179,232	2020 $ 2,323,776

Shares

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

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.

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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:

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

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

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

Compensation costs 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.

159

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

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:

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

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:

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

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• 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.

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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

December 31, 2021 Financial assets at FVTPL Domestic listed equity securities Domestic unlisted equity securities Open-end beneficiary certificates Financial assets at FVTOCI Domestic listed ordinary shares and emerging markets shares Domestic unlisted equity securities Foreign unlisted equity securities	Level 1 $ 6,643 - 445,082 $ 451,725 $ 511,180 - - $ 511,180	Level 2 $ - - - $ - $ - - - $ -	Level 3 Total $ - $ 6,643 53,224 53,224 4,793 449,875 $ 58,017 $ 509,742 $ 502,085 $1,013,265 136,548 136,548 17,079 17,079 $ 655,712 $1,166,892 (Continued)

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Level 1 Level 2 Level 3 Total

December 31, 2020 Financial assets at FVTPL Domestic listed equity securities Domestic unlisted equity securities Open-end beneficiary certificates Financial assets at FVTOCI Domestic listed ordinary shares and emerging markets shares Domestic unlisted equity securities Foreign unlisted equity securities	$ 4,763 - 445,422 $ 450,185 $ 376,499 - - $ 376,499	$ - - - $ - $ - - - $ -	$ - $ 4,763 58,830 58,830 4,646 450,068 $ 63,476 $ 513,661 $ 347,474 $ 723,973 131,196 131,196 7,729 7,729 $ 486,399 $ 862,898 (Concluded)

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

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For the year ended December 31, 2020

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

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

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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:

Fair value interest rate risk Financial assets Financial liabilities	December 31
	2021 2020 $ 1,400,290 $ 1,176,504 690,793 1,537,030

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Cash flow interest rate risk Financial assets Financial liabilities	December 31
	2021 2020 $ 2,909,610 $ 2,753,550 3,254,779 4,202,894

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 pretax 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

166

• 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 nonderivative financial liabilities were based on the agreed repayment dates.

Non-derivative financial liabilities Non-interest bearing Fixed interest rate instruments Floating interest rate instruments Lease liabilities	December 31, 2021	December 31, 2021
	Within 1 Year $ 4,427,710 208,228 1,927,042 120,292 $ 6,683,272	1-5 Years More Than 5 Years $ - $ - 33,104 92,348 1,288,896 80,730 270,495 16,552 $ 1,592,495 $ 189,630

167

Non-derivative financial liabilities Non-interest bearing Fixed interest rate instruments Floating interest rate instruments Lease liabilities	December 31, 2020	December 31, 2020
	Within 1 Year $ 3,914,549 1,314,065 1,908,542 59,308 $ 7,196,464	1-5 Years More Than 5 Years $ - $ - 32,551 83,505 2,182,924 176,862 89,946 5,224 $ 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”) Associate Adlink Technology Inc. (“Adlink”) Associate Chih Ho Shun Development Co., Ltd. Joint venture DynaScan Technology Inc. (“Dynascan USA”) Other related party (associate’s subsidiaries) Mou Kuan Industry Co., Ltd. (“Mou Kuan”) Other related party Quantel Co., Ltd. (“Quantel Thailand”) Other related party Quantel Electronics (India) Private Limited （ Quantel Other related party India ） 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., Other related party (associate’s Ltd.(Dongguan) subsidiaries)

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.

168

b. Sales

Related Party Categories/Name Associates Other related parties c. Purchases Related Party Categories/Name Associates Other related parties d. Contract liabilities Related Party Categories/Name Associates Adlink Technology Inc.	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
	2021 2020 $ 24,245 $ 18,225 41,465 42,382 $ 65,710 $ 60,607 For the Year Ended December 31
		2021 2020 $ 22,414 $ 23,987 22,985 23,085 $ 45,399 $ 47,072 December 31
		2021 $ -	2020 $ 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)

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

Outstanding trade receivables from related parties are unsecured.

169

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

Line Item Related Party Categories/Name Notes payable - related parties Other related parties Trade payables - related parties Associates Other related parties Acquisition of property, plant and equipment Related Party Categories/Name Associates		December 31	December 31
		2021 2020 $ 2,953 $ 4,570 $ 3,877 $ 6,613 7,128 4,740 $ 11,005 $ 11,353 Purchase Price
	For the Year Ended December 31
		2021 $ 24,182	2020 $ 740

• g. Acquisition of property, plant and equipment

• h. Disposal of property, plant and equipment

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

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

Related Party Categories/Name Acquisitions of right-of-use assets Associates Adlink Technology Inc. Line Item Related Party Categories/Name Lease liabilities Associates Adlink Technology Inc.	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
			2021 $ 180,053 December		2020 $ - 31 2020 -
		2021 $ 189,258		$

170

For the Year Ended December 31

	For the Year Ended December 31	For the Year Ended December 31
Line Item Related Party Categories/Name Interest Expense Associates Adlink Technology Inc. Depreciation Expense Associates Adlink Technology Inc. Refer to Note 14 for the related transaction. g. Others Line Item Related Party Categories/Name Rental income Associates Joint venture Other related parties Rental expense Associates Other related parties Administration expense Associates Other related parties Line Item Related Party Categories/Name Other current assets Associates Joint venture Other related parties Other payables Associates Other related parties	2021 2020 $ 1,317 $ - $ 27,008 $ - For the Year Ended December 31
		2021 2020 $ 6,611 $ 1,260 16 - - 100 $ 6,627 $ 1,360 $ 547 $ - - 12,600 $ 547 $ 12,600 $ 12,791 $ 450 2,785 3,481 $ 15,576 $ 3,931 December 31 2021 2020 $ 2,771 $ 523 3 - 663 1,264 $ 3,437 $ 1,787 $ 5,525 $ 75 21 - $ 5,546 $ 75
		2021 $ 2,771 3 663 $ 3,437 $ 5,525 21 $ 5,546

171

h. Compensation of key management personnel

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

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

172

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 100% equity of Environmental Stress Systems, Inc. with 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 of its important subsidiary, Chroma New Material Corp., on January 11, 2022.

• c. The Corporation’s subsidiary, Mou Kuan Technologies (Nanjin) 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 Group entities’ 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:

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December 31, 2021

Foreign Currencies Exchange Rate Financial assets Monetary items USD $ 96,108 27.680 (USD:NTD) USD 11,417 7.799(USD:HKD) USD 10,329 6.372(USD:RMB) USD $ 8,816 1.353(USD:SGD) RMB 136,085 4.344(RMB:NTD) RMB 91,770 1.224 (RMB:HKD) RMB 35,246 0.157 (RMB:USD) Non-monetary items Investments accounted for using the equity method USD 96,622 27.680(USD:NTD) Financial liabilities Monetary items USD 42,691 27.680(USD:NTD) USD 9,241 7.799 (USD:HKD) RMB 30,495 1.224 (RMB:HKD) December 31, 2020 Foreign Currencies Exchange Rate Financial assets Monetary items USD $ 113,578 28.480 (USD:NTD) USD 20,512 7.754 (USD:HKD) USD 9,108 6.507 (USD:RMB) USD 8,315 0.813 (USD:EUR) USD 7,437 1.321 (USD:SGD) RMB 135,694 4.377 (RMB:NTD) RMB 132,021 1.192 (RMB:HKD) RMB 34,682 0.154 (RMB:USD)

Carrying Amount $ 2,660,272 316,019 285,894 $ 244,031 591,153 398,647 153,109 $ 4,649,125 $ 2,674,510 1,181,688 255,798 132,472 $ 1,569,958 Carrying Amount $ 3,234,710 584,178 259,401 236,801 211,797 593,933 577,856 151,803 $ 5,850,479

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Foreign Currencies Exchange Rate Non-monetary items Investments accounted for using the equity method USD 86,592 28.480 (USD:NTD) Financial liabilities Monetary items USD 31,401 28.480 (USD:NTD) USD 13,355 7.754 (USD:HKD) USD 8,208 0.813 (USD:EUR)	Carrying Amount $ 2,466,146 $ 894,301 380,346 233,763 $ 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 group entities.

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

• 175 -

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

For the year ended December 31, 2021 Revenue from external customers Inter-segment revenue Segment revenue Consolidated revenue Segment income Non-operating income and expenses	Special Materials Department $ 2,804,306 15 $ 2,804,321 $ 59,995	Test Instrument Department $ 13,555,365 8,763,991 $ 22,319,356 $ 3,050,270	Automatic Equipment Department $ 780,206 370,736 $ 1,150,942 $ (179,022)	Other $ 444,146 49 $ 444,195 $ 107,028	Elimination $ - (9,134,791) $ (9,134,791) $ 36,722	Total $ 17,584,023 -
						17,584,023
						$ 17,584,023
						$ 3,074,993 2,208,853

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Profit before tax For the year ended December 31, 2020 Revenue from external customers Inter-segment revenue Segment revenue Consolidated revenue Segment income Non-operating income and expenses Profit before tax	Special Materials Department $ 2,551,127 7 $ 2,551,134 $ 32,246	Test Instrument Department $ 12,045,049 8,460,756 $ 20,505,805 $ 2,870,986	Automatic Equipment Department $ 617,812 194,311 $ 812,123 $ (170,512)	Other $ 318,555 275 $ 318,830 $ 5,477	Elimination $ - (8,655,349) $ (8,655,349) $ 59,204	Total $ 5,283,846
						$ 15,532,543 -
						15,532,543
						$ 15,532,543
						$ 2,797,401 231,606
						$ 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

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

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Total segment liabilities Borrowings and other unallocated liabilities Consolidated total liabilities		December 31	December 31
		2021 6,269,905 4,328,754 $ 10,598,659	2020 5,526,747 6,213,443 $ 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:

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

4)Geographical information

The Group’s primary operating areas is 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

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

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TABLE 1

CHROMA ATE INC.

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

No.	Lender	Borrower	Financial Statement Account	Related Parties	Highest Balance for the Period	Ending Balance	Actual Borrowing Amount	Interest Rate	Nature of Financing	Business Transaction Amounts	Reasons for Short-term Financing	Allowance for Impairment Loss	Collateral	Collateral	Financing Limit for Each Borrower	Aggregate Financing Limit
													Item	Value
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.

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TABLE 2

CHROMA ATE INC.

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

No.	Endorser/ Guarantor	Endorsee/Guarantee	Endorsee/Guarantee	Limits on 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	Ratio of 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	Endorsement /Guarantee Given on Behalf of Companies in Mainland China
		Name	Relationship
0	The Corporation	Chroma Japan Corp. Chroma ATE Europe B.V. Chroma ATE Inc. Sajet System Technology (Suzhou) Co., Ltd. Chroma Electronics (Shanghai) Co., Ltd. Chroma ATE (Suzhou) Co., Ltd. Mas Automation Corp.	Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary	$ 2,777,087 2,777,087 2,777,087 2,777,087 2,777,087 2,777,087 2,777,087	$ 48,200 46,980 221,440 21,720 43,440 338,832 300,000	$ 48,200 46,980 221,440 21,720 43,440 338,832 300,000	$ 36,150 15,660 138,400 - - 77,321 201,000	$ - - - - - - -	0.26% 0.25% 1.20% 0.12% 0.23% 1.83% 1.62%	$ 5,554,173 5,554,173 5,554,173 5,554,173 5,554,173 5,554,173 5,554,173	Y Y Y Y Y Y Y	- - - - - - -	- - - Y Y 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.

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TABLE 3

CHROMA ATE INC.

MARKETABLE SECURITIES HELD

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

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

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

(Continued)

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

• 182 -

TABLE 4

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 $154,510 thousand in accordance with the sale and leaseback transaction.

• 183 -

TABLE 5

CHROMA ATE INC.

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)

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

• 184 -

Chroma ATE Europe B.V. The Corporation Chroma Japan Corp. The Corporation Quantel Private Ltd. Neworld Electronics Limited Chroma Electronics (Shenzhen) Co., Ltd	The Corporation Chroma Japan Corp. The Corporation Quantel Private Ltd. The Corporation Chroma Electronics (Shenzhen) Co., Ltd Neworld Electronics Limited	Parent company Subsidiary Parent company Subsidiary Parent company Subsidiary Parent company	Purchase (Sale) Purchase (Sale) Purchase (Sale) Purchase	326,489 (258,255) 258,255 (244,962) 244,962 (1,081,194) 1,081,194	100 (3) 100 (2) 100 (41) 66	Net 90 days after delivery Net 365 days after monthly closing Net 90 days after delivery Net 90 days after delivery Net 90 days after delivery Net 90 days after declaration Net 90 days after declaration	- - - - - - -	- - - - - - -	(72,438) 344,895 (344,895) 30,409 (30,409) 231,464 (231,464)	(100) 13 (100) 1 (100) 34 (68)	- - - - - - -
										(Continued)
Company Name	Related Party	Relationship		Transaction Details			Abnormal Transaction		Notes/Accounts Receivable (Payable)		Note
			Purchase (Sale)	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
Chroma ATE Europe B.V. Chroma Germany GmbH Neworld Electronics Limited Chroma ATE (Suzhou) Co., Ltd. Wei Kuang Automatic Equipment (Xiamen) Co., Ltd. Chroma ATE (Suzhou) Co., Ltd.	Chroma Germany GmbH Chroma ATE Europe B.V. Chroma ATE (Suzhou) Co., Ltd. Neworld Electronics Limited Chroma ATE (Suzhou) Co., Ltd. Wei Kuang Automatic Equipment (Xiamen) Co., Ltd.	Subsidiary Parent company Same parent company Same parent company Same parent company Same parent company	(Sale) Purchase (Sale) Purchase (Sale) Purchase	$ (127,121) 127,121 (241,286) 241,286 (160,890) 160,890	(26) 80 (9) 18 (40) 12	Net 90 days after declaration Net 90 days after declaration Net 90 days after declaration Net 90 days after declaration Net 90 days after declaration Net 90 days after declaration	- - - - - -	- - - - - -	$ 43,050 (43,050) 126,989 (126,989) 21,881 (21,881)	36 (99) 18 (21) 21 (4)	- - - - - -

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

(Concluded)

• 185 -

TABLE 6

CHROMA ATE INC.

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)

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

Note: As of February 23, 2022.

• 186 -

TABLE 7

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)	Transaction Details	Transaction Details		Percentage to Consolidated Total Operating Revenues or Total Assets
				Account	Amount	Transaction Terms
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)

• 187 -

No.	Company Name	Counterparty	Flow of Transactions (Note 1)	Transaction Details	Transaction Details		Percentage to Consolidated Total Operating Revenues or Total Assets
				Account	Amount	Transaction Terms
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. Chroma ATE (Suzhou) Co., Ltd.	a b a a a b a b	Operating revenue Operating revenue Operating revenue Commissions expense Commissions expense Commissions expense Trade receivables Trade receivables	$ 1,081,194 241,286 63,390 62,275 35,341 19,323 231,464 126,989	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	6 1 - - - - 1 -
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)

• 188 -

TABLE 9

CHROMA ATE INC. AND SUBSIDIARIES

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

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

Note 1: 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 years ended December 31, 2021. Other amounts were translated into New Taiwan dollars at the spot exchange rate on December 31, 2021.

• 189 -

TABLE 9

CHROMA ATE INC. AND SUBSIDIARIES

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	Main Businesses and Products	Paid-in Capital (Note 2)	Method of Investment (Note 1)	Method of Investment (Note 1)	Accumulated Outward Remittance for Investment from Taiwan as of January 1, 2021 (Note 3)	Remittance of Funds	Remittance of Funds	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
							Outward	Inward
Chroma Electronics (Shenzhen) Co., Ltd. Chroma Electronics (Shanghai) Co., Ltd. Chroma (Shanghai) Trading Co., Ltd. Hangzhou New Material Chroma Co., Ltd. Chroma ATE (Suzhou) Co., Ltd. Wei Kuang Automatic Equipment (Nanjin) Co., Ltd. Wei Kuang Automatic Equipment (Xiamen) Co., Ltd. Mou Kuan Technologies (Nanjin) Co., Ltd. Sajet System Technology (Suzhou) Co., Ltd.	Sale of computerized automatic test systems, peripherals and electronic test instruments Sale of computerized automatic test systems, peripherals and electronic test instruments International and transit trading, commercial simple processing and commercial consulting service and etc. Production and sale of semiconductor connecting materials Sale of computerized automatic test systems, peripherals and electronic test instruments Sale and maintenance of electronic equipment and factory conveyor systems Sale and maintenance of electronic equipment and factory conveyor systems Assembly, sale and maintenance of factory conveyors and related systems and renders related after-sales services Research, development and design of computer network security systems and information management		$ 106,470 (HK$ 30,000) 83,040 (US$ 3,000) 74,736 (US$ 2,700) 41,520 (US$ 1,500) 105,184 (US$ 3,800) 51,568 (RMB 11,871) 49,595 (RMB 11,417) 7,546 (RMB 1,737) 36,377 (RMB 8,374)	b. Subsidiary of Neworld Electronics Limited b. Subsidiary of Neworld Electronics Limited b. Subsidiary of Chen Hwa Technology Inc. b. Subsidiary of Chen Hwa Technology Inc. b. Subsidiary of CHI Incorporation Ltd. b. Subsidiary of Wei Kuang Mech. Eng. Inc. b. Subsidiary of Wei Kuang Mech. Eng. Inc. b. Subsidiary of Wei Kuang Mech. Eng. Inc. b. Subsidiary of Deep Red Holding Co., Ltd.		$ 132,178 (HK$ 1,200 US$ 3,853) 101,993 (US$ 3,000) 84,988 (US$ 2,700) 9,091 (US$ 285) 121,115 (US$ 3,800) 43,751 (US$ 1,338) 49,935 (US$ 1,500) 92,000 (US$ 2,836) (Note 9)	$ - - - - - - - - -	$ - - - - - - - - -	$ 132,178 (HK$ 1,200 US$ 3,853) 101,993 (US$ 3,000) 84,988 (US$ 2,700) 9,091 (US$ 285) 121,115 (US$ 3,800) 43,751 (US$ 1,338) 49,935 (US$ 1,500) 92,000 (US$ 2,836) (Note 9)	$ 108,981 95,798 (347) 88,401 41,607 43,473 19,162 565 22,622	100 100 100 19 100 100 100 100 100	$ 108,981 95,798 (347) - 41,607 43,473 19,162 565 22,622	$ 1,078,664 319,603 79,739 17,079 321,459 251,294 523,463 19,289 147,068	$ 91,226 (RMB 21,156) - - 12,065 (US$ 368) - - - 47,504 (US$ 1,552) -
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 (HK$1,200, US$19,312)		$725,060 (HK$1,400, US$22,076) (Note 6)			$11,108,346 (Note 7)

(Continued)

• 190 -

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	Approved Amount	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)

• 191 -

INDEPENDENT AUDITORS’ REPOR

The Board of Directors and Shareholders Chroma ATE Inc.

Opinion

We have audited the financial statements of Chroma ATE Inc. (the “Corporation”), which comprise the balance sheets as of December 31, 2021 and 2020, and the statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Corporation as of December 31, 2021 and 2020, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the year ended December 31, 2021. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

The key audit matters of the financial statements for the year ended December 31, 2021 are described as follows:

Revenue Recognition

The main source of revenue of the Corporation is the sales of test instruments. Since the main contract condition with customers is delivery at the point of departure, the determination of the point of shipment is important for judging whether the obligations of delivery are satisfied and recognized sales revenue; thus, we identified the revenue recognition of contract with customers as a key audit matter.

Our audit procedures include 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 detailed testing on transactions, indentifying material terms and conditions in the contracts or orders, and checking the original documents such as the shipping documents and invoice to confirm the correctness of the identified performance obligations and the time of sales recognition.

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

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

Management is responsible for the preparation and fair presentation of the financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers,

192

and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Corporation’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 Corporation or to cease operations, or has no realistic alternative but to do so.

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

Auditors’ Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an 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 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 financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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

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

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

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

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

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

We also provide those charged with governance with 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 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 audit 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 financial statements are intended only to present the 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 financial statements are those generally applied in the Republic of China.

For the convenience of readers, the independent auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. 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 financial statements shall prevail.

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CHROMA ATE INC.

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

ASSETS CURRENT ASSETS Cash (Note 6) Financial assets at amortized cost - current (Notes 9 and 29) Notes receivable (Note 10) Trade receivables (Notes 5 and 10) Trade receivables - related parties (Notes 10 and 28) Other receivables - related parties (Note 28) Inventories (Note 11) Prepayments Other current assets (Note 28) Total current assets NON-CURRENT ASSETS Financial assets at fair value through profit or loss - non-current (Note 7) Financial assets at fair value through other comprehensive income - non-current (Note 8) Investments accounted for using equity method (Note 12) Property, plant and equipment (Notes 13, 28 and 29) Right-of-use assets (Note 14) Investment properties (Note 15) Goodwill (Note 16) Other intangible assets Deferred tax assets (Note 23) Prepayments for land and equipment (Note 30) Refundable deposits Non-current prepayments for investments Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Note 17) Contract liabilities - current (Notes 21 and 28) Trade payables Trade payables - related parties (Note 28) Other payables (Note 18) Current tax liabilities (Note 23) Lease liabilities - current (Note 14) Current portion of long-term borrowings (Note 17) Other current liabilities Total current liabilities NON-CURRENT LIABILITIES Long-term borrowings (Note 17) Deferred tax liabilities (Note 23) Lease liabilities - non-current (Note 14) Net defined benefit liabilities (Note 19) Guarantee deposits received Total non-current liabilities Total liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE CORPORATION (Note 20) Ordinary share capital Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Total retained earnings Other equity Treasury shares Total equity TOTAL		2021 Amount % $ 994,158 4 279,778 1 5,147 - 982,111 4 1,666,038 6 420,055 2 2,988,756 12 82,156 - 52,990 - 7,471,189 29 4,793 - 1,066,019 4 7,678,993 30 5,325,381 21 149,239 1 3,137,187 12 94,424 1 54,827 - 202,240 1 118,866 1 10,378 - 55,024 - 17,897,371 71 $ 25,368,560 100 $ 1,200,000 5 51,033 - 1,501,200 6 33,599 - 1,109,817 5 344,351 1 46,133 - 200,000 1 24,915 - 4,511,048 18 1,250,000 5 737,596 3 139,600 - 173,158 1 43,247 - 2,343,601 9 6,854,649 27 4,218,745 17 4,087,223 16 2,824,310 11 86,888 - 7,255,798 29 10,166,996 40 74,633 - (33,686) - 18,513,911 73 $ 25,368,560 100		2020
				Amount % $ 622,210 3 279,778 1 71,003 - 967,254 4 1,936,374 8 494,093 2 2,331,084 10 66,209 - 84,853 - 6,852,858 28 4,646 - 801,358 3 7,439,923 31 2,352,493 10 53,865 - 3,137,187 13 94,424 - 19,164 - 181,644 1 3,463,185 14 5,315 - - - 17,553,204 72 $ 24,406,062 100 $ 1,800,000 8 559,721 2 989,994 4 31,891 - 985,529 4 254,716 1 20,465 - 620,000 3 24,141 - 5,286,457 22 2,230,000 9 599,222 2 33,824 - 152,449 1 40,887 - 3,056,382 12 8,342,839 34 4,212,945 17 4,036,875 17 2,592,487 10 176,128 1 5,160,575 21 7,929,190 32 (82,101) - (33,686) - 16,063,223 66 $ 24,406,062 100

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

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CHROMA ATE INC.

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

OPERATING REVENUE (Notes 21 and 28) Sales Less: Sales returns Sales allowances Net operating revenue OPERATING COSTS (Notes 11, 22 and 28) GROSS PROFIT REALIZED (UNREALIZED) GAIN ON TRANSACTIONS WITH SUBSIDIARIES AND ASSOCIATES REALIZED GROSS PROFIT OPERATING EXPENSES (Notes 22 and 28) Selling and marketing expenses General and administrative expenses Research and development expenses Expected credit (gain) loss Total operating expenses PROFIT FROM OPERATIONS NON-OPERATING INCOME AND EXPENSES Finance costs (Note 22) Share of profit of subsidiaries, associates and joint ventures, net (Note 12) Interest income (Note 28) Rental income (Note 28) Dividend income Other income (Note 28) Gain (Loss) on disposal of property, plant and equipment, net Gain on disposal of investment Profit from lease modification Gains arising from transfer of right in sale and lease-back transaction Net foreign exchange loss (Note 32)		2021 Amount % $10,319,433 100 (7,769) - (3,211) - 10,308,453 100 4,807,190 46 5,501,263 54 (82,802) (1) 5,418,461 53 941,579 9 682,951 7 1,350,521 13 (2,892) - 2,972,159 29 2,446,302 24 (22,508) - 752,111 7 4,910 - 15,421 - 55,839 1 47,573 - 1,575,019 15 2,684 - 82 - 154,510 2 (85,978) (1)		2020
				Amount % $ 9,201,579 100 (19,513) - (1,826) - 9,180,240 100 4,355,315 47 4,824,925 53 42,023 - 4,866,948 53 845,805 9 537,646 6 1,216,060 14 7,000 - 2,606,511 29 2,260,437 24 (34,842) - 540,822 6 5,719 - 15,157 - 17,526 - 64,481 1 (995) - 480 - - - - - (68,727) (1) (Continued)

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CHROMA ATE INC.

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

Gain (Loss) on financial assets at fair value through profit or loss, net Other expenses Total non-operating income and expenses PROFIT BEFORE INCOME TAX INCOME TAX EXPENSE (Note 23) NET PROFIT FOR THE YEAR OTHER COMPREHENSIVE INCOME (LOSS) Items that will not be reclassified subsequently to profit or loss: Remeasurement of defined benefit plans (Note 19) Unrealized gain (loss) on investments in equity investments designated as at fair value through other comprehensive income Share of the other comprehensive income (loss) of subsidiaries, associates and joint ventures accounted for using the equity method Items that may be reclassified subsequently to profit or loss: Exchange differences on translating the financial statements of foreign operations Share of the other comprehensive loss of subsidiaries, associates and joint ventures accounted for using the equity method Total other comprehensive income (loss) TOTAL COMPREHENSIVE INCOME EARNINGS PER SHARE (NT$; Note 24) Basic Diluted		2021 Amount % $ 390 - (945) - 2,499,108 24 4,945,410 48 766,178 7 4,179,232 41 (42,177) - 258,571 2 36,998 - (67,435) - (70,564) (1) 115,393 1 $ 4,294,625 42 $ 9.96 $ 9.89		2020
				Amount % $ (44) - (5,034) - 534,543 6 2,794,980 30 471,204 5 2,323,776 25 (7,804) - 194,230 2 37,565 - 1,115 - (136,084) (1) 89,022 1 $ 2,412,798 26 $ 5.56 $ 5.51

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

(Concluded)

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CHROMA ATE INC.

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

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

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

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

CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments for: Depreciation expenses Amortization expenses Expected credit (gain) loss recognized on trade receivables Net (gain) loss on financial assets at fair value through profit or loss Finance costs Interest income Dividend income Compensation costs of share-based payments Share of profit of subsidiaries, associates and joint ventures accounted for using the equity method (Gain) Loss on disposal of property, plant and equipment Gain on disposal of investments accounted for using equity method Write-downs of inventories Unrealized loss (gain) on transactions with subsidiaries and associates Net loss on foreign currency exchange Gain on sale and leaseback transactions Gain on lease modification Net changes in operating assets and liabilities Notes receivable Trade receivables Inventories Prepayments Other current assets Contract liabilities Trade payables Other payables Other current liabilities Net defined benefit liabilities Cash generated from operations Income tax paid Net cash generated from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Payments to acquire financial assets at fair value through other comprehensive income Proceeds from disposal of financial assets at fair value through other comprehensive income Proceeds from capital reduction of financial assets at fair value through other comprehensive income

2021 2020 $ 4,945,410 $ 2,794,980 359,674 217,918 13,964 5,033 (2,892) 7,000 (390) 44 22,508 34,842 (4,910) (5,719) (55,839) (17,526) 1,415 16,948 (752,111) (540,822) (1,575,019) 995 (2,684) (480) 3,000 42,000 82,802 (42,023) 97,541 22,713 (154,510) - (82) - 65,856 (66,742) 166,790 386,680 (790,330) (370,985) 11,219 73,237 31,382 26,691 (508,688) (175,636) 526,090 (228,408) 129,470 139,896 774 5,561 (21,468) (11,108) 2,588,972 2,315,089 (558,765) (266,434) 2,030,207 2,048,655 (15,750) (17,239) - 17,946 9,660 - (Continued)

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CHROMA ATE INC.

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

		2021	2020
Payments to acquire financial assets at amortized cost	$	-	$ (279,778)
Payments to acquire financial assets at fair value through profit
or loss		(600,188)	(300,000)
Proceeds from disposal of financial assets at fair value through
profit or loss		600,431	300,072
Payments to acquire subsidiaries		-	(54,626)
Proceeds from disposal of investment		3,955	688
Increase in prepayments for investments		(55,024)	-
Payments for property, plant and equipment		-	(82,462)
Proceeds from disposal of property, plant and equipment		3,080,000	20,935
Increase in advance receipts for real estate		-	308,000
Increase in refundable deposits		(5,063)	(727)
Increase in other receivables - related parties		63,258	(329,716)
Payments for intangible assets		(23,433)	(4,750)
Increase in prepayments for equipment		(972,549)	(1,451,858)
Interest received		5,347	5,345
Dividends received		236,428	425,190
Net cash generated from (used in) investing activities		2,327,072	(1,442,980)
CASH FLOWS FROM FINANCING ACTIVITIES
(Decrease) Increase in short-term borrowings		(600,000)	200,000
Proceeds from long-term borrowings		-	950,000
Repayments of long-term borrowings	(1,400,000)		(400,000)
Increase in guarantee deposits		2,360	20,887
Repayment of the principal portion of lease liabilities		(39,117)	(22,493)
Dividends paid by cash	(1,897,175)		(1,265,000)
Exercise of employee share options		33,706	112,563
Payments for buy-back of ordinary shares		-	(1,235)
Acquisition of subsidiaries		(53,457)	-
Interest paid		(23,336)	(34,898)
Net cash used in financing activities	(3,977,019)		(440,176)
EFFECTS OF EXCHANGE RATE CHANGES ON THE
BALANCE OF CASH HELD IN FOREIGN CURRENCIES		(8,312)	(2,535)
NET INCREASE IN CASH		371,948	162,964
CASH AT THE BEGINNING OF THE YEAR		622,210	459,246
CASH AT THE END OF THE YEAR	$	994,158	$ 622,210
The accompanying notes are an integral part of the financial statements.			(Concluded)

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

CHROMA ATE INC.

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 financial statements are presented in the Corporation’s functional currency, the New Taiwan dollar (NTD).

2. APPROVAL OF FINANCIAL STATEMENTS

The 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 Corporation’s accounting policies.

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

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

201

• 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 financial statements were authorized for issue, the Corporation has assessed that the application of above standards and interpretations will not have a material impact on the Corporation’s financial position and financial performance.

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

New IFRSs Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between An Investor and Its Associate or Joint Venture” IFRS 17 “Insurance Contracts” Amendments to IFRS 17 Amendments to IFRS 17 “Initial Application of IFRS 9 and IFRS 17—Comparative Information” Amendments to IAS 1 “Classification of Liabilities as Current or Non-current” Amendments to IAS 1 “Disclosure of Accounting Policies” Amendments to IAS 8 “Definition of Accounting Estimates” Amendments to IAS 12 “Deferred Tax related to Assets and Liabilities arising from a Single Transaction”

Effective Date Announced by IASB (Note 1)

To be determined by IASB January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 (Note 2) January 1, 2023 (Note 3) January 1, 2023 (Note 4)

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

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4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

• a. Statement of compliance

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

• b. Basis of preparation

The 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, 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.

When preparing these financial statements, the Corporation used the equity method to account for its investment in subsidiaries, associates and joint ventures. In order for the amounts of the net profit for the year, other comprehensive income for the year and total equity in the financial statements to be the same with the amounts attributable to the owner of the Corporation in its financial statements, adjustments arising from the differences in accounting treatment between the basis and the consolidated basis were made to investments accounted for using the equity method, share of profit or loss of subsidiaries, associates and joint ventures, share of other comprehensive income of subsidiaries, associates and joint ventures and related equity items, as appropriate, in these financial statements.

• c. Classification of current and non-current 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 Corporation 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.

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d. Foreign currencies

In preparing the Corporation’s financial statements, 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.

e. Inventories

Inventories consist of raw materials, semi-finished goods, finished goods and work-in-process, 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.

• f. Investments accounted for using the equity method

Investments in subsidiaries, associates and joint ventures are accounted for by the equity method.

Under the equity method, investment in a subsidiary, associates and joint ventures are initially recognized at cost and adjusted thereafter to recognize the Corporation's share of the profit or loss and other comprehensive income of the subsidiary, associates and joint ventures. The Corporation recognizes the changes in the Corporation’s share of equity of subsidiaries, associates and joint ventures.

1) Investment in subsidiaries

A subsidiary is an entity that is controlled by the Corporation.

Changes in the Corporation’s ownership interest in a subsidiary that do not result in the Corporation losing control of the subsidiary are equity transactions. The Corporation recognizes directly in equity any difference between the carrying amount of the investment and the fair value of the consideration paid or received.

When the Corporation’s share of losses of a subsidiary equals or exceeds its interest in that subsidiary (which includes any carrying amount of the investment in subsidiary accounted for using the equity method and long-term interests that, in substance, form part of the Corporation’s net investment in the subsidiary), the Corporation continues recognizing its share of further losses.

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Any excess of the cost of acquisition over the Corporation’s share of the net fair value of the identifiable assets and liabilities of a subsidiary that consitutes a business 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 Corporation’s share of the net fair value of the identifiable assets and liabilities of a subsidiary that consitutes a business over the cost of acquisition is recognized immediately in profit or loss.

When the Corporation loses control of a subsidiary, it recognizes the investment retained in the former subsidiary at its fair value at the date when control is lost. The difference between the fair value of the retained investment plus any consideration received and the carrying amount of previous investment at the date when control is lost is recognized as a gain or loss in profit or loss. Besides, the Corporation accounts for all amounts previously recognized in other comprehensive income in relation to that subsidiary on the same basis as would be required if the Corporation had directly disposed of the related assets or liabilities.

Profits and losses resulting from downstream transactions are eliminated in full in the Corporation’s financial statement. Profits and losses resulting from upstream transactions and transactions between subsidiaries are recognized in the Corporation’s financial statements only to the extent of interests in the subsidiaries that are not related to the Corporation.

2) Investments in associates and joint ventures

An associate is an entity over which the Corporation 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 Corporation and other parties that have joint control of the arrangement have rights to the net assets of the arrangement.

Any excess of the cost of acquisition over the Corporation’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 Corporation’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 Corporation 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 Corporation’s proportionate interest in the associate and joint venture. The Corporation 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 Corporation’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 Corporation’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 Corporation’s net investment in the associate and joint venture), the Corporation discontinues recognizing its share of further losses. Additional losses and liabilities are recognized only to the extent that the Corporation has incurred legal obligations, or constructive obligations, or made payments on behalf of that associate and joint venture.

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When a group entity transacts with its associate and joint venture, profits and losses resulting from the transactions with the associate and joint venture are recognized in the Corporation’s financial statements only to the extent that interests in the associate and the joint venture are not related to the Corporation.

• g. 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 cost 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.

• h. 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.

i. 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 Corporation’s cashgenerating units or groups of cash-generating units (referred to as “cash-generating units”) that are expected to benefit from the synergies of the combination.

If goodwill has been allocated to a cash-generating unit and the Corporation 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.

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j. 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.

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.

k. Financial instruments

Financial assets and financial liabilities are recognized when the Corporation 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 27.

1) Financial assets

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

The Corporation’s financial assets are classified into the following categories:

• a) Financial assets at FVTPL

The Corporation’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 Corporation, 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.

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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 Corporation’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 Corporation 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 Corporation’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 Corporation 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.

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

Repurchase of the Corporation’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 Corporation’s own equity instruments.

• 3) Financial liabilities

Financial liabilities are measured at amortized cost using the effective interest method. On 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.

• l. Assessment of asset impairment

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

At the end of each reporting period, the Corporation 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 Corporation 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 Corporation assesses its investment in subsidiaries for any impairment by comparing the carrying amount with the estimated recoverable amount as assessed based on the investee’s financial statements as a whole. If the recoverable amount of the investment subsequently increases, the Corporation recognizes a reversal of the impairment loss; the adjusted post-reversal carrying amount should not exceed the carrying amount that would have been recognized had no impairment loss been recognized in prior years. An impairment loss recognized on goodwill cannot be reversed in a subsequent period.

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.

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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 Corporation 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 Corporation always recognizes lifetime expected credit losses (ECLs) for trade receivables and contract assets. For all other financial instruments, the Corporation 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 Corporation 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, 12month 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 Corporation 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 Corporation 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.

• m. Warranty provision

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 Corporation of the expenditures required to settle the obligations.

n. Revenue recognition

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

Revenue from sale of goods comes from sales of test instruments. Revenue is recognized when the goods are delivered to the customer’s specific location or the goods are shipped because it is the time

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

• o. Leases

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

• 1) The Corporation 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 Corporation as lessee

The Corporation 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 Corporation 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 Corporation 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 Corporation recognizes only the amount of any gain or loss which relates to the rights transferred to the buyer-lessor, and adjusts the offmarket 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.

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p. Government grants

Government grants are not recognized until there is reasonable assurance that the Corporation 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 Corporation recognizes as expenses the related costs for which the grants are intended to compensate. Specifically, government grants whose primary condition is that the Corporation 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 Corporation with no future related costs are recognized in profit or loss in the period in which they become receivable.

q. 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 services.

2) Retirement benefits

Payments to defined contribution retirement benefit plans are recognized as expenses when employees have rendered services 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 liabilities (assets) are recognized as employee benefits expense in the period in which 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 liabilities (assets) represent the actual deficit (surplus) in the Corporation’s defined benefit plans. 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.

r. Share-based payment arrangements

Employee share options and restricted shares for employees that are granted to employees 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 Corporation's best estimate of the number of 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.

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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 Corporation 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.

s. 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 on unappropriated earnings is provided for 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 Corporation 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.

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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 Corporation 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 Corporation’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 Corporation uses judgment in making these assumptions and in selecting the inputs to the impairment calculation, based on the Corporation’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

Cash on hand Demand deposits		December 31	December 31
		2021 $ 1,900 992,258 $ 994,158	2020 $ 1,916 620,294 $ 622,210

7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

Financial assets mandatorily at FVTPL-non-current Open-end beneficiary certificates		December	31
		2021 $ 4,793	2020 $ 4,646

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8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

Investments in equity instruments-non-current Domestic listed ordinary shares and emerging market shares Domestic unlisted ordinary shares		December 31	December 31
		2021 $ 929,471 136,548 $1,066,019	2020 $ 670,162 131,196 $ 801,358

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 Corporation’s strategy of holding these investments for long-term purposes.

9. FINANCIAL ASSETS AT AMORTIZED COST - CURRENT

Pledged deposits (Note 29)		December 31	December 31
		2021 $ 279,778	2020 $ 279,778

10. NOTES RECEIVABLE AND TRADE RECEIVABLES

Gross carrying amount at amortized cost - unrelated parties Less: Allowance for impairment loss Gross carrying amount at amortized cost - related parties		December 31	December 31
		2021 $ 1,032,735 (45,477) 987,258 1,666,038 $ 2,653,296	2020 $ 1,086,626 (48,369) 1,038,257 1,936,374 $ 2,974,631

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, and no interest was charged on trade receivables. Before accepting any new customer, the Corporation 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 Corporation.

The Corporation 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 past default experience of the debtor and an analysis of the debtor’s current financial position, adjusted for general economic conditions of the industry in which the debtors operate. As the Corporation’s historical credit loss experience does not show other factors that matter significantly, the expected credit loss rate is based on past due status of trade receivables.

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The Corporation 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 Corporation 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:

Not past due Past due 1- 60 days Past due 61-180 days Past due 181-365 days Past due over 365 days		December 31	December 31
		2021 $ 747,338 99,082 81,613 74,679 30,023 $ 1,032,735	2020 $ 831,676 72,699 45,151 41,049 96,051 $ 1,086,626

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

Balance at January 1 Add: Impairment loss Less: Reversal of impairment loss Balance at December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 48,369 - ( 2,892) $ 45,477	2020 $ 41,369 7,000 - $ 48,369

11. INVENTORIES

Finished goods Semi-finished products Work in process Raw materials		December 31	December 31
		2021 $ 361,753 506,484 902,739 1,217,780 $ 2,988,756	2020 $ 277,297 443,435 654,770 955,582 $ 2,331,084

The cost of goods sold for the years ended December 31, 2021 and 2020 included the inventory writedowns of $3,000 thousand and $42,000 thousand, respectively.

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12. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

Investments in subsidiaries Investments in associates Investments in joint venture		December 31	December 31
		2021 $ 4,551,629 3,111,361 16,003 $ 7,678,993	2020 $ 4,300,696 3,122,336 16,891 $ 7,439,923

• a. Investments in subsidiaries

Unlisted company Neworld Electronics Limited Chroma New Material Corp. Mas Automation Corp. Chroma ATE Inc. Chroma Systems Solutions, Inc. Chroma ATE Europe B.V. Chroma Japan Corp. CHI Incorporation Ltd. Chen Hwa Technology Inc. San Eagle Development Corp. Sensational Holdings Ltd. Deep Red Holding Co., Ltd. Testar Electronics Corporation Adivic Technology Co., Ltd. Chroma Investment Co., Ltd. Quantel Private Ltd. EVT Technology Co., Ltd. Innovative Nanotech Incorporated Touch Cloud Inc.		December 31	December 31	December 31
		2021 Amount Percentage of Equity Interest (%) $ 1,457,155 100.0 452,823 100.0 54,437 100.0 240,654 100.0 28,328 25.0 121,610 100.0 (137,987) 100.0 240,238 100.0 120,885 100.0 903,070 100.0 49,035 100.0 161,366 100.0 117,453 67.2 60,382 74.1 224,435 100.0 206,174 60.0 31,423 85.6 162,380 67.2 57,768 83.1 $ 4,551,629		2020
				Amount Percentage of Equity Interest (%) $ 1,464,458 100.0 428,239 100.0 270,267 100.0 128,653 100.0 (6,717) 25.0 137,505 100.0 (125,940) 100.0 197,569 100.0 106,264 100.0 845,853 100.0 50,764 100.0 142,022 100.0 34,528 67.2 73,705 74.1 163,702 100.0 175,480 60.0 40,558 85.6 152,441 71.1 21,345 78.1 $ 4,300,696

The Corporation and the Corporation’s subsidiary, Chroma USA, held 75% equity interest in Chroma Systems Solutions, Inc.

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 Corporation’s equity remained the same.

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%.

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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.

The Corporation’s subsidiary, Wei Da Electric Vehicle Co., Ltd., had completed its liquidation procedures on October 15, 2020.

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.

Refer to Note 33 for the detail of the subsidiaries indirectly held by the Corporation. Refer to Table 7 “Information on Investees” for the Corporations’ share of profit of subsidiaries under equity method.

The investments accounted for using the equity method and the share of profit or loss and other comprehensive income of those investments for the years ended December 31, 2021 and 2020 were calculated based on the financial statements which have been audited.

• b. Investments in associates

Associates that are not individually material Adlink Technology Inc. Dynascan Technology Corp. Camtek Ltd.		December 31	December 31	December 31
		2021 Amount Percentage of Equity Interest (%) $ 284,189 11.2 152,662 27.3 2,674,510 17.8 $ 3,111,361		2020
				Amount Percentage of Equity Interest (%) $ 514,751 11.3 141,439 27.3 2,466,146 18.1 $ 3,122,336

The Corporation’s share of: Net profit Other comprehensive loss Total comprehensive income (loss) for the year	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 305,017 (74,891) $ 230,126	2020 $ 136,122 (136,588) $ (466)

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

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

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Although the Corporation’s equity interest in Camtek Ltd. fell below 20% in 2020, after assessment the Corporation’s seats of directors in Camtek, it still have the significant influence, therefore Camtek, Ltd is still regarded as associate.

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

Refer to Table 7 “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 associate accounted for using 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.

• c. Investments in joint ventures

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

Aggregate information of joint ventures that are not individually material:

The Corporation’s share of: Net loss Other comprehensive income Total comprehensive loss for the year	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ (888) - $ (888)	2020 $ (730) - $ (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 Fabruary 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 7 “Information on Investees” for the nature of activities, principal place of business and country of incorporation of 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 were based on the joint ventures’ financial statements which have been audited.

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13.PROPERTY, PLANT AND EQUIPMENT

Cost Balance, January 1, 2020 Additions Disposals Reclassification Balance, December 31, 2020 Accumulated depreciation Balance, January 1, 2020 Depreciation Disposals Reclassification Balance, December 31, 2020 Carrying amount at December 31, 2020 Cost Balance, January 1, 2021 Disposals Reclassification Balance, December 31, 2021 Accumulated depreciation Balance, January 1, 2021 Depreciation Disposals Reclassification Balance, December 31, 2021 Carrying amount at December 31, 2021	Land $ 1,138,906 - - - $ 1,138,906 Land $ - - - - $ - $ 1,138,906 $ 1,138,906 (425,072) 2,519 $ 716,353 $ - - - - $ - $ 716,353	Buildings $ 2,033,510 7,309 - 3,195 $ 2,044,014 Buildings $ 1,123,547 68,836 - 2,512 $ 1,194,895 $ 849,119 $ 2,044,014 (1,601,556) 4,035,943 $ 4,478,401 $ 1,194,895 172,262 (938,399) - $ 428,758 $ 4,049,643	Machinery Miscellaneous Equipment Total $ 179,278 $ 1,246,991 $ 4,598,685 14,739 65,651 87,699 (2,024) (175,987) (178,011) (12,764) 84,658 75,089 $ 179,229 $ 1,221,313 $ 4,583,462 (Continued) Machinery Miscellaneous Equipment Total $ 132,245 $ 936,348 $ 2,192,140 23,951 102,442 195,229 (2,022) (147,195) (149,217) (18,057) 8,362 (7,183) $ 136,117 $ 899,957 $ 2,230,969 $ 43,112 $ 321,356 $ 2,352,493 $ 179,299 $ 1,221,313 $ 4,583,462 (4,786) (147,605) (2,179,019) 66,262 32,023 4,136,747 $ 240,705 $ 1,105,731 $ 6,541,190 $ 136,117 $ 899,957 $ 2,230,969 32,615 121,429 326,306 (4,787) (146,191) (1,089,377) - (252,089) (252,089) $ 163,945 $ 623,106 $ 1,215,809 $ 76,760 $ 482,625 $ 5,325,381 (Concluded)

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 Corporation 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 $128,797 thousand and lease liabilities of $170,699 thousand, refer to Note 28 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:

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Buildings
Primary buildings	41-50 years
Mechanical and electrical equipment	8-15 years
Clean room equipment	3-11 years
Others	1-49 years
Machinery	1-10 years
Office equipment	1-9 years

14. LEASE ARRANGEMENTS

The Corporation’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 is 2 to 10 years. The Corporation does not have bargain purchase options to acquire lease items at the end of lease terms.

The right-of-use assets increases $137,234 thousand and $31,159 thousand, the depreciation was $33,368 thousand and $22,689 thousand, and the total cash out flow in lease was $47,376 thousand and $25,953 thousand for the years ended December 31, 2021 and 2020, respectively. Refer to the balance sheets for the right-of-use assets and lease liabilities.

15. INVESTMENT PROPERTIES

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

The Corporation 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.

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

In the third quarter of 2019, the Corporation 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 Corporation provided the lands and Fu Yu Construction provided fund to construct. The area will be distributed to the Corporation 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 guaranted notes with a denomination of $120,000 thousand to the Corporation 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.

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16. GOODWILL

To reorganize the organization structure, save operating costs and improve the operating efficiency, the Corporation’s board of directors resolved to acquire Silver Town Electronic Co., Ltd. in February 2008. The goodwill was from the premium acquisition. There was no change for the years end December 31, 2021 and 2020.

For assessing goodwill for impairment, the Corporation took value in use as basis for calculating the recoverable amount of goodwill. The Corporation 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 Corporation did not recognize any impairment loss on goodwill for the years ended December 31, 2021 and 2020.

17. BORROWINGS

• a. Short-term borrowings

Unsecured bank loans Interest rate (%)		December 31
	2021 2020 $ 1,200,000 $ 1,800,000 0.52%-0.68% 0.52%-071%

• b. Long-term borrowings

Secured bank loans (Note 29) Unsecured bank loans Less: Current portions		December 31	December 31
		2021 $ - 1,450,000 1,450,000 200,000 $ 1,250,000	2020 $ 300,000 2,550,000 2,850,000 620,000 $ 2,230,000

The Corporation applied for bank loan for increasing operating budget. As of December 31, 2021 and 2020, the interest rate was 0.68%-0.83% and 0.69%-0.89% per annum on a floating basis. The bank loan will be due in June 2026.

18. OTHER PAYABLES

Salaries and bonus Employee’s compensation Remuneration of directors Others		December 31	December 31
		2021 $ 386,421 448,825 9,600 264,971 $1,109,817	2020 $ 343,916 408,769 9,600 223,244 $ 985,529

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19.RETIREMENT BENEFIT PLANS

a. Defined contribution plans

The Corporation adopted a pension plan under the Labor Pension Act (the “LPA”), which is a statemanaged defined contribution plan. Under the LPA, an entity makes monthly contributions to employees’ individual pension accounts at 6% of monthly salaries and wages.

b. Defined benefit plans

The defined benefit plan adopted by the Corporation in accordance with the Labor Standards Law is operated by the government. Pension benefits are calculated on the basis of length of service and average monthly salaries of the 6 months before retirement. The Corporation contributes 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 assesses the balances 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 is 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 Corporation has no right to influence the investment policy and strategy.

The amounts included in the balance sheets in respect of the Corporation’s defined benefit plans were as follows:

Present value of defined benefit obligation Fair value of plan assets Net defined benefit liabilities		December 31	December 31
		2021 $ 530,677 (357,519) $ 173,158	2020 $ 486,736 (334,287) $ 152,449

Movements in net defined benefit liability were as follows:

	Present Value
	of the Defined	Fair Value of	Net Defined
	Benefit	the Plan	Benefit
	Obligation	Assets	Liabilities
Balance at January 1, 2020	$ 475,089	$(319,336)	$ 155,753
Current service cost	3,576	-	3,576
Net interest expense (income)	3,563	(2,453)	1,110
Recognized in profit or loss	7,139	(2,453)	4,686
Remeasurement
Return on plan assets (excluding
amounts included in net interest)	-	(10,445)	(10,445)
Actuarial (gain) loss
Changes in demographic assumptions	118	-	118
Changes in financial assumptions	13,617	-	13,617
Experience adjustments	4,514	-	4,514
Recognized in other comprehensive
income	18,249	(10,445)	7,804
Contributions from employer	-	(15,794)	(15,794)
Benefits paid	(13,741)	13,741	-
Balance at December 31, 2020	486,736	(334,287)	152,449

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	Present Value
	of the Defined	Fair Value of	Net Defined
	Benefit	the Plan	Benefit
	Obligation	Assets	Liabilities
Current service cost	3,381	-	3,381
Net interest expense (income)	2,408	(1,711)	697
Recognized in profit or loss	5,789	(1,711)	4,078
Remeasurement
Return on plan assets (excluding
amounts included in net interest)	-	(4,263)	(4,263)
Actuarial (gain) loss
Changes in demographic assumptions	15,086	-	15,086
Experience adjustments	31,354	-	31,354
Recognized in other comprehensive
income	46,440	(4,263)	42,177
Contributions from employer	-	(25,546)	(25,546)
Benefits paid	(8,288)	8,288	-
Balance at December 31, 2021	$ 530,677	$(357,519)	$ 173,158

Through the defined benefit plans under the Labor Standards Law, the Corporation 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:

as follows:
Discount rate(s) Expected rate(s) of salary increase	December 31
	2021 2020 0.38%-0.50% 0.38%-0.50% 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:

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Discount rate(s) 0.25% increase 0.25% decrease Expected rate(s) of salary increase 0.25% increase 0.25% decrease		December	31
		2021 $(13,924) $ 14,466 $ 13,956 $(13,508)	2020 $(13,617) $ 14,172 $ 13,667 $(13,206)

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.

Expected contributions to the plan for the next year Average duration of the defined benefit obligation		December	31
		2021 2020 $ 30,000 $ 15,713 11.1 years 11.6 years

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20. EQUITY

a. Ordinary share capital

Ordinary share capital
Number of shares authorized (in thousands) Shares authorized Number of shares issued and fully paid (in thousands) Shares issued		December 31
		2021 500,000 $ 5,000,000 421,875 $ 4,218,745	2020 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

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 May be used to offset a deficit only Share of changes in capital surplus of associates or joint ventures May not be used for any purpose Employee shares options Employee restricted shares		December 31	December 31
		2021 $ 3,372,101 218,317 146,976 341,296 8,533 - $ 4,087,223	2020 $ 3,331,004 210,193 146,976 327,868 16,060 4,774 $ 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 dividends policy

Under the dividends 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. 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.

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For the policies on distribution of employees’ compensation of employees and remuneration to directors, refer to d. employees’ compensation of employees and remuneration of directors in Note 22.

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 share dividends are subject to actual earnings and capital requirements of the Corporation in a particular year.

An appropriation of earnings to the legal reserve shall be made until the legal reserve equals the Corporation’s paid-in capital. The legal reserve may be used to offset deficit. If the Corporation has no deficit 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 was annulled on December 31,2021 and March 31, 2021, respectively.

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

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

The appropriations of earnings for 2021 had been proposed by the Corporation’s board of directors on February 23, 2022, were as follows:

	Appropriation	Dividends Per
	of Earnings	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 the shareholder’ 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.

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e. Other equity items

f.	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 $(466,042) $ 384,493 $ (552) Exchange differences on translating foreign operations (67,435) - - Unrealized gain arising from equity investments - 258,571 - Share of other comprehensive gain (loss) of associates and join ventures accounted for using the equity method (70,628) 35,601 - Disposal of investments accounted for using the equity method 64 9 6 4 - Share-based payment transaction - - 552 Balance at December 31, 2021 $(604,041) $ 678,674 $ - For the year ended December 31, 2020 Balance at January 1, 2020 $(331,073) $ 154,946 $ (11,524) Exchange differences on translating foreign operations 1,115 - - Unrealized gain arising from equity investments - 194,230 - Share of other comprehensive gain (loss) of associates and join ventures accounted for using the equity method (136,092) 35,317 - Disposal of investments accounted for using the equity method 8 - - Share-based payment transaction - - 10,972 Balance at December 31, 2020 $(466,042) $ 384,493 $ (552) Treasury shares The Corporation’s shares held by its subsidiaries at the end of the reporting periods were as follows:	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 $(466,042) $ 384,493 $ (552) Exchange differences on translating foreign operations (67,435) - - Unrealized gain arising from equity investments - 258,571 - Share of other comprehensive gain (loss) of associates and join ventures accounted for using the equity method (70,628) 35,601 - Disposal of investments accounted for using the equity method 64 9 6 4 - Share-based payment transaction - - 552 Balance at December 31, 2021 $(604,041) $ 678,674 $ - For the year ended December 31, 2020 Balance at January 1, 2020 $(331,073) $ 154,946 $ (11,524) Exchange differences on translating foreign operations 1,115 - - Unrealized gain arising from equity investments - 194,230 - Share of other comprehensive gain (loss) of associates and join ventures accounted for using the equity method (136,092) 35,317 - Disposal of investments accounted for using the equity method 8 - - Share-based payment transaction - - 10,972 Balance at December 31, 2020 $(466,042) $ 384,493 $ (552) Treasury shares The Corporation’s shares held by its subsidiaries at the end of the reporting periods were as follows:	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 $(466,042) $ 384,493 $ (552) Exchange differences on translating foreign operations (67,435) - - Unrealized gain arising from equity investments - 258,571 - Share of other comprehensive gain (loss) of associates and join ventures accounted for using the equity method (70,628) 35,601 - Disposal of investments accounted for using the equity method 64 9 6 4 - Share-based payment transaction - - 552 Balance at December 31, 2021 $(604,041) $ 678,674 $ - For the year ended December 31, 2020 Balance at January 1, 2020 $(331,073) $ 154,946 $ (11,524) Exchange differences on translating foreign operations 1,115 - - Unrealized gain arising from equity investments - 194,230 - Share of other comprehensive gain (loss) of associates and join ventures accounted for using the equity method (136,092) 35,317 - Disposal of investments accounted for using the equity method 8 - - Share-based payment transaction - - 10,972 Balance at December 31, 2020 $(466,042) $ 384,493 $ (552) Treasury shares The Corporation’s shares held by its subsidiaries at the end of the reporting periods were as follows:	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 $(466,042) $ 384,493 $ (552) Exchange differences on translating foreign operations (67,435) - - Unrealized gain arising from equity investments - 258,571 - Share of other comprehensive gain (loss) of associates and join ventures accounted for using the equity method (70,628) 35,601 - Disposal of investments accounted for using the equity method 64 9 6 4 - Share-based payment transaction - - 552 Balance at December 31, 2021 $(604,041) $ 678,674 $ - For the year ended December 31, 2020 Balance at January 1, 2020 $(331,073) $ 154,946 $ (11,524) Exchange differences on translating foreign operations 1,115 - - Unrealized gain arising from equity investments - 194,230 - Share of other comprehensive gain (loss) of associates and join ventures accounted for using the equity method (136,092) 35,317 - Disposal of investments accounted for using the equity method 8 - - Share-based payment transaction - - 10,972 Balance at December 31, 2020 $(466,042) $ 384,493 $ (552) Treasury shares The Corporation’s shares held by its subsidiaries at the end of the reporting periods were as follows:
	Number of shares held (in thousand shares) Carrying amount Market price		December 31
			2021 1,806 $ 33,686 $ 361,116	2020 1,806 $ 33,686 $ 303,337

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

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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.

21. REVENUE

Contract revenue of the Corporation comes from sale of goods.

• a. Contract balances

Contract liabilities from sale of goods (1) Construction contract revenue (2)		December 31	December 31
		2021 $ 51,033 - $ 51,033	2020 $ 251,721 308,000 $ 559,721

• 1) The changes in the balance of contract liabilities primarily result from the timing difference between the Corporation’s performance and respective customer’s payment.

• 2) Refer to Notes 13 and 28 for related information.

b. Disaggregation of revenue

Automatic test systems Precision electronic test instruments Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 5,354,137 3,871,975 1,082,341 $10,308,453	2020 $ 4,976,066 3,352,078 852,096 $ 9,180,240

22. ADDITIONAL INFORMATION ON EXPENSES

• a. Finance costs

Interest on borrowings Interest on lease liabilities	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 21,034 1,474 $ 22,508	2020 $ 34,097 745 $ 34,842

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b. Depreciation and amortization

For the Year Ended December

An analysis of depreciation by function Operating costs Operating expenses An analysis of amortization by function Operating costs Operating expenses		31
		2021 $ 111,090 248,584 $ 359,674 $ 85 13,879 $ 13,964	2020 $ 43,477 174,441 $ 217,918 $ - 5,033 $ 5,033

c. Employee benefits expense

Short-term benefits Salary expenses Insurance expenses Remuneration of directors Share-based payments Retirement benefits Defined contribution plans Defined benefit plans Other employee benefits Total employee benefits expense			For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
			2021	Total $ 2,021,651 153,147 10,230 2,185,028 1,415 72,285 4,078 76,363 43,385 $ 2,306,191 $			2020
		Operating Costs $ 352,274 36,975 - 389,249 - 10,856 592 11,448 19,480 $ 420,177	Operating Expenses $ 1,669,377 $ 116,172 10,230 1,795,779 1,415 61,429 3,486 64,915 23,905 $ 1,886,014 $			Operating Costs $ 300,078 31,134 - 331,212 - 9,705 737 10,442 16.185 $ 357,839	Operating Expenses $ 1,525,548 $ 106,919 10,320 1,642,787 16,948 57,473 3,949 61,422 23,868 $ 1,745,025 $	Total $ 1,825,626 138,053 10,320 1,973,999 16,948 67,178 4,686 71,864 40,053 $ 2,102,864

• 1) As of December 31, 2021 and 2020, the Corporation’s average number of employees was 1,831 and 1,754 employees, respectively, among which 5 directors not concurrently holding positions in the Corporation in both years. The basis of above calculations was the same as the basis used in the calculation of employee benefits expense.

• 2) As of December 31, 2021 and 2020, the average employee benefit expenses were $1,257 thousand and $1,196 thousand, respectively; average salary expenses were $1,107 thousand and $1,044 thousand, respectively. The change in average salary expense was 6.0%.

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• 3) The Corporation set up an audit committee in accordance with Article 14-4 of Securities and Exchange Act and did not set up supervisory duties.

• 4) The Corporation’s compensation policy is determined by considering the operating performance and future development of the current year and the remuneration of directors and managers and employees are as follows:

Directors

The remuneration paid by the Corporation is comprises bonus for directors. When the board of directors is held, the Corporation will also pay the directors’ attendance.

According to Article 34 of the Corporation’s Articles of Incorporation, bonus distributed to directors shall not be greater than 1.5% of the Corporation's net profit before income tax, employees’ compensation, and remuneration of directors.

The fixed amount of directors’ remuneration for 2021 and 2020 was 9,600 thousand which accounts for 0.18% and 0.30% of the net profit before tax for each year, respectively. The director attendance expenses for 2021 and 2020 was $630 thousand and $720 thousand, respectively.

Managers

The Corporation has established the “Regulations Governing Compensation for Senior Executives”, which stipulates that when a manager is appointed, he/she shall be paid a fixed monthly salary based on the pay standards for similar positions in the industry. Any proposal to change employee bonus shall be made according to the Corporation's operational performance for the current year and by taking into individual performance appraisal. Such proposal shall first be submitted to the Remuneration Committee for review before it is delivered to the Board of Directors for resolution.

Staff

The Corporation’s remuneration policy takes into account the salary levels of benchmark companies in the market, and provide differentiated and competitive salaries for employees based on the achievement of performance indicators to reflect the ability of employees and to measure salary and bonus levels. The salary composition includes salaries, bonuses and employee remuneration, benefits, etc.; benefits are superior to the legal provisions as prerequisites are designed to improve talent attraction, motivation, and retention effects.

• d. Employees’ compensation and remuneration of directors

According to the Article of Incorporation of the Corporation, the Corporation accrued 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:

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

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If there is a change in the amounts after the annual 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 actual amounts recognized in the 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 in 2022 and 2021 is available at the Market Observation Post System website of the Taiwan Stock Exchange.

23. INCOME TAXES

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

Current tax In respect of the current year Land value incremental tax Income tax on unappropriated earnings Adjustments for prior years Deferred tax In respect of the current year Income tax expense recognized in profit or loss	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 433,897 200,196 14,307 - 648,400 117,778 $ 766,178	2020 $ 365,461 - 14,990 (36,631) 343,820 127,384 $ 471,204

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

Profit before tax Income tax expense calculated at the statutory rate Adjustment items in determining taxable income Tax-exempt income other Land value incremental tax Unrecognized investment credits Income tax on unappropriated earnings Adjustments for prior years’ tax Income tax expense recognized in profit or loss	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 4,945,410 $ 989,082 (326,751) 8,645 200,196 (119,301) 14,307 - $ 766,178	2020 $ 2,794,980 $ 558,996 (3,405) 18,808 - (81,554) 14,990 (36,631) $ 471,204

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b. Deferred tax assets and liabilities

For the year ended December 31, 2021

Deferred tax assets Temporary differences Unrealized intercompany gain Inventory reserve Unrealized exchange loss Gain on disposal of assets Allowance for impaired receivables Net defined benefit liability Others Deferred tax liabilities Temporary differences Unappropriated earnings of subsidiaries Goodwill Others For the year ended December 31, 2020 Deferred tax assets Temporary differences Unrealized intercompany gain Inventory reserve Unrealized exchange loss Net defined benefit liability Allowance for impaired receivables Provisions Deferred tax liabilities Temporary differences Unappropriated earnings of subsidiaries Goodwill

Opening Balance Recognized in Profit or Loss Closing Balance $ 112,022 $ 16,560 $ 128,582 56,058 600 56,658 5,301 3,275 8,576 - 3,853 3,853 3,628 70 3,698 3,762 (3,762) - 873 - 873 $ 181,644 $ 20,596 $ 202,240 (Continued) Opening Balance Recognized in Profit or Loss Closing Balance $ 566,002 $ 135,236 $ 701,238 33,220 2,606 35,826 - 532 532 $ 599,222 $ 138,374 $ 737,596 Opening Balance Recognized in Profit or Loss Closing Balance $ 120,426 $ (8,404) $ 112,022 47,658 8,400 56,058 8,952 (3,651) 5,301 5,983 (2,221) 3,762 1,546 2,082 3,628 873 - 873 $ 185,438 $ (3,794) $ 181,644 $ 445,017 $ 120,985 $ 566,002 30,615 2,605 33,220 $ 475,632 $ 123,590 $ 599,222

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c.Income tax assessments

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

24. 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

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

If the Corporation offered to settle compensation paid to employees in cash or shares, the Corporation 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.

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25. SHARE-BASED PAYMENT ARRANGEMENTS

• a. Employee share option plan

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:

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

Information on outstanding options is as follows:

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

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

• b. 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.

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• 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 is as follows:

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

Compensation 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

26. CAPITAL MANAGEMENT

The Corporation manages its capital to ensure that it will be able to continue as going concerns while maximizing the return to shareholders through the optimization of the debt and equity balance. The Corporation’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.

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27. FINANCIAL INSTRUMENTS

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

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

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

• 1) Fair value hierarchy

December 31, 2021 Financial assets at FVTPL Openend beneficiary certificates Financial assets at FVTOCI Domestic listed ordinary shares and emerging markets shares Foreign unlisted equity securities December 31, 2020 Financial assets at FVTPL Open-end beneficiary certificates Financial assets at FVTOCI Domestic listed ordinary shares and emerging markets shares Foreign unlisted equity securities	Level 1 $ - $ 511,180 - $ 511,180 $ - $ 376,499 - $ 376,499	Level 2 $ - $ - - $ - $ - $ - - $ -	Level 3 $ 4,793 $ 418,291 136,548 $ 554,839 $ 4,646 $ 293,663 131,196 $ 424,859	Total $ 4,793 $ 929,471 136,548 $1,066,019 $ 4,646 $ 670,162 131,196 $ 801,358

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

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

For the year ended December 31, 2021

Financial Assets Balance at January 1, 2021 Purchases Reduction of capital cash return Recognized in profit or loss (included in valuation gains and losses) Recognized in other comprehensive income (included in unrealized gain on financial assets at FVTOCI) Balance at December 31, 2021 For the year ended December 31, 2020 Financial Assets Balance at January 1, 2020 Purchases Disposal Unrealized gains and losses from sales to subsidiaries Recognized in profit or loss (included in valuation gains and losses) Recognized in other comprehensive income (included in unrealized gain on financial assets at FVTOCI) Balance at December 31, 2020	Financial Assets at FVTPL Open-end beneficiary certificates $ 4,646 - - 147 - $ 4,793 Financial Assets at FVTPL Open-end beneficiary certificates $ 4,762 - - - (116) - $ 4,646	Financial Assets at FVTOCI Equity Instruments $ 424,859 15,750 (9,660) - 123,890 $ 554,839 Financial Assets at FVTOCI Equity Instruments $ 200,037 17,239 (9,000) (8,946) - 225,529 $ 424,859	Total $ 429,505 15,750 (9,660) 147 123,890 $ 559,632 Total $ 204,799 17,239 (9,000) (8,946) (116) 225,529 $ 429,505

• 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.

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c. Categories of financial instruments

Categories of financial instruments
Financial assets Financial assets at FVTPL Mandatorily at FVTPL Financial assets at amortized cost (1) Financial assets at FVTOCI Equity instruments Financial liabilities Financial liabilities at amortized cost (2)	December 31
	2021 2020 $ 4,793 $ 4,646 4,370,212 4,405,723 1,066,019 801,358 5,337,863 6,698,301

• 1) The balances include financial assets at amortized cost, which comprise cash, financial assets at amortised cost, notes receivable, trade receivables, other receivables (classified as other receivable - related parties and other current assets) and refundable deposits.

• 2) The balances included financial liabilities measured at amortized cost, which comprise short-term loans, 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 Corporation’s major financial instruments consist of equity investments, cash, receivables, longterm and short-term borrowings, and trade payables. The Corporation’s financial risk management pertains to financial risks relating to the operations of the Corporation, including currency risk, interest rate risk, credit risk and liquidity risk. The Corporation seeks to identify, evaluate and hedge against market uncertainties to lower the effect of market changes on the Corporation’s financial performance.

The Corporation 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 Corporation actively observes the exchange rate information to fully control the foreign currency hedge.

1) Market risk

The Corporation’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 Corporation’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 Corporation’s foreign currency denominated monetary assets and monetary liabilities at the end of the reporting period are set out in Note 32.

Sensitivity analysis

The Corporation was mainly exposed to USD and RMB.

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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. Had the NTD strengthened/weakened by 5% against the relevant currency, the pre-tax profit would have decreased/increased by $85,192 thousand and $101,208 thousand for the years ended December 31, 2021 and 2020, respectively.

b) Interest rate risk

The Corporation is exposed to interest rate risk because it borrows funds both at fixed and floated interest rates. The Corporation 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:

Fair value interest rate risk Financial assets Financial liabilities Cash flow interest rate risk Financial assets Financial liabilities	December 31
	2021 2020 $ 279,778 $ 279,778 185,733 1,054,289 992,258 620,294 2,650,000 3,650,000

Sensitivity analysis

The sensitivity analysis below was 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 Corporation’s pre-tax profit for the years ended December 31, 2021 and 2020 would have decreased/increased by $8,289 thousand and $15,149 thousand, respectively, which was mainly attributable to the Corporation’s exposure to interest rates on its variable rate deposits and bank loans.

c) Price risk

The Corporation is exposed to equity price risks mainly arising from investment in open-end beneficiary certificates, listed stocks and emerging markets stocks in Taiwan, which are held for strategic rather than trading purposes. The Corporation does not actively trade these investments. The Corporation manages the risk through holding various portfolios of investment and having each equity investment to get prior approval from the Corporation’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.

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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 $240 thousand and $232 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 $53,301 thousand and $40,068 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 the counterparty will default on its contractual obligations resulting in financial loss to the Corporation. As at the end of the reporting period, the Corporation’s maximum exposure to credit risk, which would cause a financial loss to the Corporation 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 Corporation 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 bank deposits, fixed-income financial instruments and other financial instruments are evaluated, managed and controlled by the Corporation’s financial department. The Corporation’s exposure to credit risk was limited because the Corporation adopted a policy of only dealing with creditworthy counterparties.

• 3) Liquidity risk

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

The Corporation relies on bank borrowings as a significant source of liquidity. As of December 31, 2021 and 2020, the Corporation’s available unutilized bank loan facilities were $3,800,000 thousand and $2,850,000 thousand, respectively.

Liquidity and interest risk tables for non-derivative financial liabilities

The following tables detail the Corporation’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 Corporation 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.

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Non-interest bearing Floating interest rate instruments Lease liabilities Non-interest bearing Fixed interest rate instruments Floating interest rate instruments Lease liabilities	December 31, 2021	December 31, 2021
	Within 1 Year 1-5 Years $ 2,644,616 $ - 1,413,814 1,262,347 47,547 136,956 $ 4,105,977 $ 1,399,303 December 31, 2020		More Than 5 Years $ - - 4,789 $ 4,789
	Within 1 Year $ 2,007,414 1,000,185 1,445,424 20,998 $ 4,474,021	1-5 Years $ - - 2,136,262 28,220 $ 2,164,482	More Than 5 Years $ - - 120,417 6,530 $ 126,947

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

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

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28. TRANSACTIONS WITH RELATED PARTIES

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

Related Party Chroma ATE Inc. (“Chroma USA”) Neworld Electronics Limited (“Neworld”) Chroma ATE Europe B.V. (“Chroma Europe”) Chroma Investment Co., Ltd. (“Chroma Investment”) Chroma New Material Corp. (“Chroma New Material”) Chroma Japan Corp. (“Chroma Japan”) Chroma Systems Solutions, Inc. (“CSS”) Quantel Private Ltd. (“Quantel”) Mas Automation Corp. (“Taiwan Wei Kuang”) Testar Electronics Corporation (“Testar Electronics”) Adivic Technology Co., Ltd. (“Adivic Tech.”) Sajet System Technology (Suzhou) Co., Ltd. (“Sajet Suzhou”) Chroma Electronics (Shenzhen) Co., Ltd. (“Chroma Shenzhen”) Chroma Electronics (Shanghai) Co., Ltd. (“Chroma Shanghai”) Chroma ATE (Suzhou) Co., Ltd. (“Chroma Suzhou”) EVT Technology Co., Ltd. (“EVT”) Innovative Nanotech Incorporated (“Innovative”) Chroma Germany GmbH (“Chroma Germany”) Adlink Technology Inc. (“Adlink”) DynaScan Technology Corp. (“DynaScan Technology”) Related Party Chih Ho Shun Development Co., Ltd. Tian Zheng International Precision Machinery Co., Ltd. (“Tian Zheng International”) Taiwan Advanced Nanotech Inc. (“TAN Bead”)	Relationship with the Corporation
	Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Associate Associate Relationship with the Corporation
	Joint venture Other related party Other related party

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

The related-party transactions were as follows:

b. Sales

Related Party Category/Name Subsidiaries Neworld Chroma USA Others Associates Other related parties	For the Year Ended December 31 2021 2020 $ 2,438,399 $ 3,090,906 1,226,840 1,054,688 2,945,225 2,042,821 24,245 18,003 18,626 - $ 6,653,335 $ 6,206,418	For the Year Ended December 31 2021 2020 $ 2,438,399 $ 3,090,906 1,226,840 1,054,688 2,945,225 2,042,821 24,245 18,003 18,626 - $ 6,653,335 $ 6,206,418	For the Year Ended December 31 2021 2020 $ 2,438,399 $ 3,090,906 1,226,840 1,054,688 2,945,225 2,042,821 24,245 18,003 18,626 - $ 6,653,335 $ 6,206,418
		2021 $ 2,438,399 1,226,840 2,945,225 24,245 18,626 $ 6,653,335	2020 $ 3,090,906 1,054,688 2,042,821 18,003 - $ 6,206,418

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To raise market share and expand its market in the America, Europe and mainland China, the Corporation set up Chroma USA, Chroma Europe and Neworld. The selling prices for Chroma USA, CSS, Chroma Europe, Neworld, Chroma Suzhou, and Chroma Shenzhen were determined after taking the selling and post-sale service expenses into consideration.

• c. Purchases

Related Party Category/Name Subsidiaries Associates Other related parties Contract liabilities Related Party Categories Related Party Name Associates Adlink Technology Inc.	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 2020 $ 148,323 $ 116,053 19,795 21,686 8,582 9 $ 176,700 $ 137,748 December 31
		2021 $ -	2020 $ 308,000

• d. Contract liabilities

It is advance receipt for selling the land and plant in Hwa Ya Technology park, refer to Note 13 for the detailed information.

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

Line Item Related Party Category/Name Trade receivables Subsidiaries Neworld Chroma Japan Chroma USA Others Associates Other related parties Other receivable-related party Subsidiaries (dividends receivable) Taiwan Wei Kuang Payables to related parties (excluding loans from related parties) Line Item Related Party Categories/Name Trade payables Subsidiaries Associates Other related parties Acquisitions of property, plant and equipment Related Party Categories/Name Subsidiaries Associates Disposal of property, plant and equipment Proceeds For the Year Ended December 31 Related Party Category/Name 2021 2020 Associates Adlink Technology Inc.$ 3,080,000 $ -	Line Item Related Party Category/Name Trade receivables Subsidiaries Neworld Chroma Japan Chroma USA Others Associates Other related parties Other receivable-related party Subsidiaries (dividends receivable) Taiwan Wei Kuang Payables to related parties (excluding loans from related parties) Line Item Related Party Categories/Name Trade payables Subsidiaries Associates Other related parties Acquisitions of property, plant and equipment Related Party Categories/Name Subsidiaries Associates Disposal of property, plant and equipment Proceeds For the Year Ended December 31 Related Party Category/Name 2021 2020 Associates Adlink Technology Inc.$ 3,080,000 $ -	Line Item Related Party Category/Name Trade receivables Subsidiaries Neworld Chroma Japan Chroma USA Others Associates Other related parties Other receivable-related party Subsidiaries (dividends receivable) Taiwan Wei Kuang Payables to related parties (excluding loans from related parties) Line Item Related Party Categories/Name Trade payables Subsidiaries Associates Other related parties Acquisitions of property, plant and equipment Related Party Categories/Name Subsidiaries Associates Disposal of property, plant and equipment Proceeds For the Year Ended December 31 Related Party Category/Name 2021 2020 Associates Adlink Technology Inc.$ 3,080,000 $ -	Line Item Related Party Category/Name Trade receivables Subsidiaries Neworld Chroma Japan Chroma USA Others Associates Other related parties Other receivable-related party Subsidiaries (dividends receivable) Taiwan Wei Kuang Payables to related parties (excluding loans from related parties) Line Item Related Party Categories/Name Trade payables Subsidiaries Associates Other related parties Acquisitions of property, plant and equipment Related Party Categories/Name Subsidiaries Associates Disposal of property, plant and equipment Proceeds For the Year Ended December 31 Related Party Category/Name 2021 2020 Associates Adlink Technology Inc.$ 3,080,000 $ -	For			December 31	December 31
							2021 2020 $ 415,016 $ 533,772 344,895 208,148 310,748 567,037 581,600 622,376 11,796 5,041 1,983 - $ 1,666,038 $1,936,374 $ 295,000 $ 305,000 December 31
							2021 2020 $ 25,019 $ 25,550 3,803 6,341 4,777 - $ 33,599 $ 31,891 the Year Ended December 31
					$		2021 2020 6,248 $ 1,121 24,182 740 30,430 $ 1,861 Gain on Disposal
					$
		For the Year Ended December 31					For the Year Ended December 31
		2021 $ 3,080,000	2020 $ -			2021 $ 1,575,072		2020 $ -

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

• g. Acquisitions of property, plant and equipment

• h. Disposal of property, plant and equipment

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 13 for the detailed information.

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i. Lease arrangements

Related Party Categories/Name Acquisitions of right-of-use assets Associates Adlink Technology Inc. Line Item Related Party Categories/Name Lease liabilities Associates Adlink Technology Inc.	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
			2021 2020 $ 128,797 $ - December 31
			2021 $ 145,525	2020 $ -

Refer to Note 13 for the related transaction.

• j. Loans to related parties

• 1) Loans and interest receivables

Line Item Related Party Categories/Name Other receivable-related party Subsidiaries CSS Chroma Japan Other current asset Subsidiaries (interest receivables) Interest revenue Related Party Categories/Name Subsidiaries CSS Chroma Japan	December 31 2021 2020 $ 100,106 $ 106,417 24,949 82,676 $ 125,055 $ 189,093 $ 301 $ 731 For the Year Ended December 31	December 31 2021 2020 $ 100,106 $ 106,417 24,949 82,676 $ 125,055 $ 189,093 $ 301 $ 731 For the Year Ended December 31	December 31	December 31	December 31
					2020 $ 106,417 82,676 $ 189,093 $ 731 December
		2021 $ 3,352 978 $ 4,330		$	2020 3,664 938 4,602
				$

• 2) Interest revenue

Refer to Table 1 (attached) for other information related to financing provided.

• k. Endorsement guarantees provided

Refer to Table 2 (attached) for other information related to endorsement guarantees provided.

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l. Others

1) Commission expense

Related Party Categories/Name Subsidiaries Chroma Shanghai Quantel Chroma Suzhou Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 29,573 26,796 16,419 10,966 $ 83,754	2020 $ 29,144 5,523 10,141 4,691 $ 49,499

Commission expense refers to the disbursements made for business introduction activities.

• 2) Rental income

Related Party Categories/Name Subsidiaries Testar Electronics Adivic Tech. Others Associates Dynascan Technology Corp. Joint venture Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 5,757 2,192 647 6,611 16 $ 15,223	2020 $ 11,979 - 1,284 1,260 - $ 14,523

The Corporation leased out its A7 office buildings and plant, as well as the plant in Hsinchu Science Industrial Park to the above related parties under operating lease contracts, and these leases were based on market prices. Rents were collected monthly.

• 3) Management service income

Related Party Categories/Name Subsidiaries Chroma New Material Others	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 6,000 600 $ 6,600	2020 $ 6,000 600 $ 6,600

Management service income was from the Corporation’s provision of administrative services.

247

• 4) Other current assets - other receivables

Related Party Categories/Name Subsidiaries Testar Electronics Neworld Others Associates Dynascan Technology Corp. Others. Joint venture Others.		December 31	December 31
		2021 $ 2,026 5,202 858 2,755 16 3 $ 10,860	2020 $ 13,679 4,817 1,520 - 523 - $ 20,539

Receivables were recognized from managerial services and building rentals.

• m. Compensation of key management personnel

Short-term employee benefits Post-employment benefits	For the Year Ended December 31	For the Year Ended December 31	For the Year Ended December 31
		2021 $ 175,876 2,765 $ 178,641	2020 $ 144,666 2,435 $ 147,101

29. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY

The assets pledged as collaterals for bank loans were as follows:

Land and buildings, net Pledge deposits (classified as financial assets measured at amortized cost)		December 31	December 31
		2021 $ - 279,778 $ 279,778	2020 $ 597,432 279,778 $ 877,210

30. SIGNIFICANT EVENTS AFTER REPORTING PERIOD

• a. Considering the future strategy of products and the improvement of product competitiveness, the Corporation invested 100% equity of Environmental Stress Systems, Inc. with 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 of its important subsidiary, Chroma New Material Corp., on January 11, 2022.

• c. The Corporation’s subsidiary, Mou Kuan Technologies (Nanjin) Co., Ltd., had completed its liquidation procedures on January 25, 2022.

248

31. 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 Corporation 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 Corporation continuously observes and assesses the impact of the pandemic on the aforementioned aspects.

32. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The Corporation’s significant financial assets and liabilities denominated in foreign currencies were as follows:

December 31, 2021 Foreign Currencies Exchange Rate Financial assets Monetary items USD $ 60,274 27.680 (USD:NTD) RMB 107,879 4.344(RMB:NTD) Non-monetary items Investments accounted for using the equity method USD 170,744 27.680 (USD:NTD) HKD 489,648 3.549(HKD:NTD) Financial liabilities Monetary items USD 15,649 27.680 (USD:NTD) December 31, 2020 Foreign Currencies Exchange Rate Financial assets Monetary items USD $ 63,736 28.480 (USD:NTD) RMB 96,728 4.377 (RMB:NTD)

Carrying Amount $ 1,668,384 468,626 $ 2,137,010 $ 4,657,421 1,737,760 $ 6,395,181 $ 433,164 Carrying Amount $ 1,815,201 423,378 $ 2,238,579

249

Foreign Currencies Exchange Rate Non-monetary items Investments accounted for using the equity method USD $ 149,393 28.480 (USD:NTD) HKD 450,598 3.673 (HKD:NTD) Financial liabilities Monetary items USD 7,529 28.480 (USD:NTD)	Carrying Amount $ 3,930,554 1,464,458 $ 5,395,012 $ 214,426

For the years ended December 31, 2021 and 2020, (realized and unrealized) net foreign exchange losses were $85,978 thousand and $68,727 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.

33. 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) Information on investees: Table 7 (attached)

250

• 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 8 (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.

251

TABLE 1

CHROMA ATE INC.

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

No.	Lender	Borrower	Financial Statement Account	Related Parties	Highest Balance for the Period	Ending Balance	Actual Borrowing Amount	Interest Rate	Nature of Financing	Business Transaction Amounts	Reasons for Short-term Financing	Allowance for Impairment Loss	Collateral	Collateral	Financing Limit for Each Borrower	Aggregate Financing Limit
													Item	Value
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.

• 252 -

TABLE 2

CHROMA ATE INC.

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

No.	Endorser/ Guarantor	Endorsee/Guarantee	Endorsee/Guarantee	Limits on 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	Ratio of 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	Endorsement /Guarantee Given on Behalf of Companies in Mainland China
		Name	Relationship
0	The Corporation	Chroma Japan Corp. Chroma ATE Europe B.V. Chroma ATE Inc. Sajet System Technology (Suzhou) Co., Ltd. Chroma Electronics (Shanghai) Co., Ltd. Chroma ATE (Suzhou) Co., Ltd. Mas Automation Corp.	Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary	$ 2,777,087 2,777,087 2,777,087 2,777,087 2,777,087 2,777,087 2,777,087	$ 48,200 46,980 221,440 21,720 43,440 338,832 300,000	$ 48,200 46,980 221,440 21,720 43,440 338,832 300,000	$ 36,150 15,660 138,400 - - 77,321 201,000	$ - - - - - - -	0.26% 0.25% 1.20% 0.12% 0.23% 1.83% 1.62%	$ 5,554,173 5,554,173 5,554,173 5,554,173 5,554,173 5,554,173 5,554,173	Y Y Y Y Y Y Y	- - - - - - -	- - - Y Y 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.

• 253 -

TABLE 3

CHROMA ATE INC.

MARKETABLE SECURITIES HELD

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

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

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

• 254 -

Holding Company Name	Type and Name of Marketable Securities	Relationship with the Holding Company	Financial Statement Account		December 31, 2021	December 31, 2021		Note
				Shares/Units (Thousands)	Carrying Amount	Percentag e of Ownershi p	Fair Value
	Chroma ATE Inc. Taiwan Advanced Nanotech Inc. Cosmactive Broadband Networks Co., Ltd. Global Mixed-mode Technology Inc.	The Corporation - - -	Financial assets at fair value through other comprehensive income - non-current 〃 〃 〃	1,806 607 4 111	361,115 83,794 - -	0.4 2.6 0.6 5.1	361,115 83,794 - -	- - - -
							(Continued)

• 255 -

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

• 256 -

TABLE 4

CHROMA ATE INC.

DISPOSAL OF INDIVIDUAL REAL ESTATE AT PRICES OF AT LEAST NT$300 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE YEAR 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 Corporation recognized gain arising from transfer of right $154,510 thousand in accordance with the sale and leaseback transaction.

• 257 -

TABLE 5

CHROMA ATE INC.

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)

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

• 258 -

Chroma ATE Europe B.V. The Corporation Chroma Japan Corp. The Corporation Quantel Private Ltd. Neworld Electronics Limited Chroma Electronics (Shenzhen) Co., Ltd	The Corporation Chroma Japan Corp. The Corporation Quantel Private Ltd. The Corporation Chroma Electronics (Shenzhen) Co., Ltd Neworld Electronics Limited	Parent company Subsidiary Parent company Subsidiary Parent company Subsidiary Parent company	Purchase (Sale) Purchase (Sale) Purchase (Sale) Purchase	326,489 (258,255) 258,255 (244,962) 244,962 (1,081,194) 1,081,194	100 (3) 100 (2) 100 (41) 66	Net 90 days after delivery Net 365 days after monthly closing Net 90 days after delivery Net 90 days after delivery Net 90 days after delivery Net 90 days after declaration Net 90 days after declaration	- - - - - - -	- - - - - - -	(72,438) 344,895 (344,895) 30,409 (30,409) 231,464 (231,464)	(100) 13 (100) 1 (100) 34 (68)	- - - - - - -
										(Continued)
Company Name	Related Party	Relationship		Transaction Details			Abnormal Transaction		Notes/Accounts Receivable (Payable)		Note
			Purchase (Sale)	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
Chroma ATE Europe B.V. Chroma Germany GmbH Neworld Electronics Limited Chroma ATE (Suzhou) Co., Ltd. Wei Kuang Automatic Equipment (Xiamen) Co., Ltd. Chroma ATE (Suzhou) Co., Ltd.	Chroma Germany GmbH Chroma ATE Europe B.V. Chroma ATE (Suzhou) Co., Ltd. Neworld Electronics Limited Chroma ATE (Suzhou) Co., Ltd. Wei Kuang Automatic Equipment (Xiamen) Co., Ltd.	Subsidiary Parent company Same parent company Same parent company Same parent company Same parent company	(Sale) Purchase (Sale) Purchase (Sale) Purchase	$ (127,121) 127,121 (241,286) 241,286 (160,890) 160,890	(26) 80 (9) 18 (40) 12	Net 90 days after declaration Net 90 days after declaration Net 90 days after declaration Net 90 days after declaration Net 90 days after declaration Net 90 days after declaration	- - - - - -	- - - - - -	$ 43,050 (43,050) 126,989 (126,989) 21,881 (21,881)	36 (99) 18 (21) 21 (4)	- - - - - -

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

(Concluded)

• 259 -

TABLE 6

CHROMA ATE INC.

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)

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

Note: As of February 23, 2022.

• 260 -

TABLE 7

CHROMA ATE INC.

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

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

• 261 -

TABLE 8

CHROMA ATE INC.

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	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)	Remittance of Funds	Remittance of Funds	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
						Outward	Inward
Chroma Electronics (Shenzhen) Co., Ltd. Chroma Electronics (Shanghai) Co., Ltd. Chroma (Shanghai) Trading Co., Ltd. Hangzhou New Material Chroma Co., Ltd. Chroma ATE (Suzhou) Co., Ltd. Wei Kuang Automatic Equipment (Nanjin) Co., Ltd. Wei Kuang Automatic Equipment (Xiamen) Co., Ltd. Mou Kuan Technologies (Nanjin) Co., Ltd. Sajet System Technology (Suzhou) Co., Ltd.	Sale of computerized automatic test systems, peripherals and electronic test instruments Sale of computerized automatic test systems, peripherals and electronic test instruments International and transit trading, commercial simple processing and commercial consulting service and etc. Production and sale of semiconductor connecting materials Sale of computerized automatic test systems, peripherals and electronic test instruments Sale and maintenance of electronic equipment and factory conveyor systems Sale and maintenance of electronic equipment and factory conveyor systems Assembly, sale and maintenance of factory conveyors and related systems and renders related after-sales services Research, development and design of computer network security systems and information management		$ 106,470 (HK$ 30,000) 83,040 (US$ 3,000) 74,736 (US$ 2,700) 41,520 (US$ 1,500) 105,184 (US$ 3,800) 51,568 (RMB 11,871) 49,595 (RMB 11,417) 7,546 (RMB 1,737) 36,377 (RMB 8,374)	b Subsidiary of Neworld Electronics Limited b Subsidiary of Neworld Electronics Limited b Subsidiary of Chen Hwa Technology Inc. b Subsidiary of Chen Hwa Technology Inc. b Subsidiary of CHI Incorporation Ltd b Subsidiary of Wei Kuang Mech Eng Inc. b Subsidiary of Wei Kuang Mech Eng Inc. b Subsidiary of Wei Kuang Mech Eng Inc. b. Subsidiary of Deep Red Holding Co., Ltd.	$ 132,178 (HK$ 1,200 US$ 3,853) 101,993 (US$ 3,000) 84,988 (US$ 2,700) 9,091 (US$ 285) 121,115 (US$ 3,800) 43,751 (US$ 1,338) 49,935 (US$ 1,500) 92,000 (US$ 2,836) (Note 9)	$ - - - - - - - - -	$ - - - - - - - - -	$ 132,178 (HK$ 1,200 US$ 3,853) 101,993 (US$ 3,000) 84,988 (US$ 2,700) 9,091 (US$ 285) 121,115 (US$ 3,800) 43,751 (US$ 1,338) 49,935 (US$ 1,500) 92,000 (US$ 2,836) (Note 9)	$ 108,981 95,798 (347) 88,401 41,607 43,473 19,162 565 22,622	100 100 100 19 100 100 100 100 100	$ 108,981 95,798 (347) - 41,607 43,473 19,162 565 22,622	$ 1,078,664 319,603 79,739 17,079 321,459 251,294 523,463 19,289 147,068	$ 91,226 (RMB 21,156) - - 12,065 (US$ 368) - - - 47,504 (US$ 1,552) -
Accumulated Outward Remittance for Investment 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 (HK$1,200, US$19,312)		$725,060 (HK$1,400, US$22,076) (Note 6)		$11,108,346 (Note 7)

(Continued)

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Note 1: Methods of investment have following types:

• 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 dollar 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)C:\WINDOWS\Temp\REPORT.MDB

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Chroma ATE Inc.

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Chairman Leo Huang

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