CHUNG HUNG - Interim / Quarterly Report 2021

Chung Hung Steel Corporation and Subsidiaries

Consolidated Financial Statements for the Six Months Ended June 30, 2021 and 2020 and Independent Auditors’ Review Report

INDEPENDENT AUDITORS’ REVIEW REPORT

Chung Hung Steel Corporation

Introduction

We have reviewed the accompanying consolidated balance sheets of Chung Hung Steel Corporation (the Corporation) and its subsidiaries as of June 30, 2021 and 2020, and the consolidated statements of comprehensive income for the three months and six months ended June 30, 2021 and 2020, and the consolidated statements of changes in equity and of cash flows for the six months ended June 30, 2021 and 2020, and the notes to the consolidated financial statements, including a summary of significant accounting policies (collectively referred to as 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 International Accounting Standard 34 “Interim Financial Reporting” endorsed and issued into effect by the Financial Supervisory Commission (FSC) of the Republic of China. Our responsibility is to express a conclusion on the consolidated financial statements based on our reviews.

Scope of Review

We conducted our reviews in accordance with Statement of Auditing Standards No. 65 “Review of Financial Information Performed by the Independent Auditor of the Entity”. A review of consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our reviews, nothing has come to our attention that caused us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the financial position of the Corporation and its subsidiaries as of June 30, 2021 and 2020, and its consolidated financial performance for the six months ended June 30, 2021 and 2020, and its consolidated cash flows for the six months ended June 30, 2021 and 2020 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34 “Interim Financial Reporting” endorsed and issued into effect by the FSC.

The engagement partners on the reviews resulting in this independent auditor’s review report are Yu-Hsiang Liu and Jia-Ling Chiang.

Deloitte & Touche Taipei, Taiwan Republic of China

August 3, 2021

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 review such consolidated financial statements are those generally applied in the Republic of China.

For the convenience of readers, the independent auditors’ review 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’ review report and consolidated financial statements shall prevail.

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash (Note 6) Financial assets at fair value through profit or loss - current (Note 7) Financial assets at fair value through other comprehensive income - current (Note 8) Accounts receivable (Notes 9 and 23) Accounts receivable from related parties (Notes 9, 23and 29) Other receivables (Note 9) Other receivables from related parties (Notes 9 and 29) Current tax assets Inventories (Note 10) Prepayments (Note 11) Other financial assets - current (Notes 12 and 30) Other current assets Total current assets NONCURRENT ASSETS Financial assets at fair value through other comprehensive income - noncurrent (Note 8) Investments accounted for using equity method (Note 13) Property, plant and equipment (Notes 14 and 31) Right-of-use assets (Note 15) Investment properties (Note 16) Prepayments for equipment (Note 31) Refundable deposits Total noncurrent assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Notes 17, 29 and 30) Short-term bills payable (Note 17) Contract liabilities – current (Note 23) Accounts payable (Note 19) Accounts payable to related parties (Notes 19 and 29) Other payables (Notes 20 and 29) Current tax liabilities Lease liabilities – current (Note 15) Refund liabilities Other current liabilities Total current liabilities NONCURRENT LIABILITIES Bonds payable (Note 18) Long-term borrowings (Note 17) Long-term bills payable (Note 17) Deferred tax liabilities Lease liabilities - noncurrent (Note 15) Net defined benefit liabilities (Note 4) Guarantee deposits received (Note 16) Total noncurrent liabilities Total liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE CORPORATION (Note 22) Ordinary shares Capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings (Accumulated deficit) Total retained earnings Other equity Total equity TOTAL	June 30, 2021 (Reviewed) Amount % $417,411 1 311,266 1 1,311,126 4 983,394 3 44,274 - 136,787 - 99,672 - 81 - 6,078,932 19 160,197 1 302,800 1 2,922 - 9,848,862 31 89,060 - 4,474,380 14 11,057,072 35 70,604 - 5,982,741 19 21,855 - 5,938 - 21,701,650 69 $31,550,512 100 $1,389,419 4 99,990 - 70,218 - 460,582 1 809,322 3 1,349,729 4 757 - 15,317 - 299,046 1 22,869 - 4,517,249 14 2,995,606 9 1,400,000 4 1,139,500 4 182,222 1 56,191 - 278,524 1 35,000 - 6,087,043 19 10,604,292 34 14,355,444 45 903 - 144,632 - 425,839 1 4,287,155 14 4,857,626 15 1,732,247 5 20,946,220 66 $31,550,512 100	December 31, 2020 (Audited) Amount % $287,373 1 242,410 1 819,454 3 830,087 3 117,238 - 19,321 - 26,672 - 514 - 4,236,420 16 150,961 1 301,700 1 3,961 - 7,036,111 26 68,193 - 2,669,716 10 11,162,643 41 78,330 - 5,983,185 22 95,659 1 6,220 - 20,063,946 74 $27,100,057 100 $404,630 2 3,599,577 13 57,283 - 27,500 - 313,224 1 580,264 2 5 - 15,230 - 153,756 1 15,764 - 5,167,233 19 2,995,039 11 2,000,000 8 1,109,674 4 182,222 1 63,898 - 313,717 1 35,000 - 6,699,550 25 11,866,783 44 14,355,444 53 903 - 90,568 - 549,578 2 662,620 3 1,302,766 5 (425,839) (2) 15,233,274 56 $27,100,057 100	June 30, 2020 (Reviewed)
			Amount % $729,929 2 159,739 1 685,361 2 1,192,378 4 21,643 - 5,553 - 528,423 2 477 - 5,261,602 18 182,032 1 301,700 1 1,067 - 9,069,904 31 64,019 - 2,168,027 8 12,166,795 41 85,968 - 5,983,629 20 81,258 - 6,119 - 20,555,815 69 $29,625,719 100 $5,405,553 18 2,549,608 9 24,911 - 22,309 - 98,532 - 471,234 2 - - 15,130 - 161,118 1 18,899 - 8,767,294 30 1,996,865 7 2,900,000 10 1,709,859 6 182,222 1 71,449 - 348,841 1 35,000 - 7,244,236 24 16,011,530 54 14,355,444 48 903 - 90,568 - 549,578 2 (366,921) (1) 273,225 1 (1,015,383) (3) 13,614,189 46 $29,625,719 100

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

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings (Loss) Per Share) (Reviewed, Not Audited)

OPERATING REVENUES (Notes 23 and 29) Sales Service revenue Other operating revenue Total operating revenue OPERATING COSTS (Notes 10, 24 and 29) GROSS PROFIT (LOSS) OPERATING EXPENSES (Note 24) Selling and marketing expenses General and administrative expenses Total operating expenses PROFIT (LOSS) FROM OPERATIONS NON-OPERATING INCOME AND EXPENSES (Notes 16, 24 and 29) Interest income Other income Other gains and losses Finance costs Share of the loss of associates Total non-operating income and expenses PROFIT (LOSS) BEFORE INCOME TAX INCOME TAX (Notes 4 and 25) NET PROFIT (LOSS) FOR THE PERIOD OTHER COMPREHENSIVE INCOME (LOSS) (Note 22) Items that will not be reclassified subsequently to profit or loss Unrealized gains and losses on investments in equity instruments at fair value through other comprehensive income Share of the other comprehensive income of associates Items that may be reclassified subsequently to profit or loss Exchange differences on translating foreign operations TOTAL COMPREHENSIVE INCOME (LOSS) FOR THE PERIOD	For the Three Months EndedJune 30	For the Three Months EndedJune 30	For the Three Months EndedJune 30	% 99 1 - 100 101 (1) 3 1 4 (5) - - - - - - (5) - (5) 1 2 - 3 (2)	For the	Six Months EndedJune 30	Six Months EndedJune 30
	2021	% 99 1 - 100 84 16 1 1 2 14 - - 3 - - 3 17 - 17 3 11 - 15 32	2020		2021	% 99 1 - 100 83 17 1 1 2 15 - - 1 - - 2 16 - 16 3 7 - 10 25	2020
	Amount $13,239,545 134,789 23,029 13,397,363 11,281,983 2,115,380 109,924 138,722 248,646 1,866,734 239 27,842 401,778 (10,469) (208) 419,182 2,285,916 5,090 2,280,826 467,085 1,520,249 (55) 1,987,279 $4,268,105		Amount $7,753,740 83,094 13,578 7,850,412 7,944,494 (94,082) 195,819 70,800 266,619 (360,701) 372 26,873 (4,592) (23,984) (1,576) (2,907) (363,608) - (363,608) 50,294 194,160 - 244,454 ($119,154)		Amount $23,896,381 289,473 42,031 24,227,885 20,164,371 4,063,514 232,616 228,715 461,331 3,602,183 275 55,188 351,766 (22,054) (1,291) 383,884 3,986,067 5,223 3,980,844 512,539 1,650,281 (55) 2,162,765 $6,143,609

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings (Loss) Per Share) (Reviewed, Not Audited)

For the Three Months EndedJune 30	For the Three Months EndedJune 30	For the Three Months EndedJune 30	For the	Six Months EndedJune 30	Six Months EndedJune 30
2021	% 17 32	2020	2021	% 16 25	2020
Amount $2,280,826 $4,268,105 $1.59 $1.59		Amount ($363,608) ($119,154) ($0.25) ($0.25)	Amount $3,980,844 $6,143,609 $2.77 $2.77		Amount ($488,903) ($954,708) ($0.34) ($0.34)	% (3)
						(5)

(Concluded)

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

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

	Retained Earnings	Other Equity Exchange Unrealized Gain (Loss) on Financial Differences on Assets at Fair Value Translating Through Other Foreign Comprehensive Operations Income $- ($425,839) - - - - - - - - (55) 2,162,820 (55) 2,162,820 - (4,679) ($55) $1,732,302 $- ($549,578) - - - - - - - (465,805) - (465,805) $- ($1,015,383)	Total Equity $15,233,274
		Exchange Differences on Translating Foreign Operations $- - - - - (55) (55) - ($55) $- - - - - - $-
Legal Reserve $90,568 54,064 - - - - - - $144,632 $90,450 118 - - - - $90,568	Special Reserve $549,578 - - (123,739) - - - - $425,839 $497,607 - 51,971 - - - $549,578
			-
			(430,663)
			-
			3,980,844 2,162,765
			6,143,609
			-
			$20,946,220
			$14,568,897
			-
			-
			(488,903) (465,805)
			(954,708)
			$13,614,189

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

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)
CASH FLOWS FROM OPERATING ACTIVITIES Profit (loss) before income tax Adjustments for: Depreciation expense Net loss on financial assets and liabilities at fair value through profit or loss Finance costs Interest income Dividends income Share of the profit of associates Loss on disposal of property, plant and equipment Reversal of inventories Others Changes in operating assets and liabilities Financial assets mandatorily classified as at fair value through profit or loss Accounts receivable Accounts receivable from related parties Other receivables Other receivables from related parities Inventories Prepayments Other current assets Contract liabilities Accounts payable Accounts payable to related parties Other payables Other current liabilities Net defined benefit liabilities Refund liabilities Cash generated from operations Income taxes refund (paid) Net cash generated from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of investments accounted for using equity method Acquisition of property, plant and equipment Decrease (increase) in refundable deposits	For the Six Months EndedJune 30
	2021 $3,986,067 382,493 (344,797) 22,054 (275) (450) 1,291 - (20,465) 567 148,077 (153,307) 72,964 10,398 (28,729) (1,822,047) (9,236) 1,039 12,935 433,082 496,098 341,372 7,105 (35,193) 145,290 3,646,333 (4,038) 3,642,295 (200,000) (192,223) 282	2020 ($488,903) 589,572 21,612 49,400 (478) (8,771) 3,159 11,545 (115,187) - - (726,361) 24,090 478 12,991 1,431,222 46,499 623 (260,141) (7,363) 32,935 (42,015) 2,465 (25,019) 7,506
		559,859 184
		560,043
		- (239,195) (487)

(Continued)

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

Increase in other financial assets Interest received Dividends received from others Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from short-term borrowings Repayments of short-term borrowings Proceeds from short-term bills payable Repayments of short-term bills payable Issuance of bonds payable Proceeds from long-term borrowings Repayments of long-term borrowings Proceeds from long-term bills payable Repayments of long-term bills payable Repayments of principal of lease liabilities Interest paid Net cash generated from (used in) financing activities NET INCREASE IN CASH CASH AT THE BEGINNING OF THE PERIOD CASH AT THE END OF THE PERIOD	For the Six Months EndedJune 30	For the Six Months EndedJune 30
	2021 ($1,100) 275 450 (392,316) 38,775,271 (37,790,482) 700,413 (4,200,000) - 300,000 (900,000) 239,826 (210,000) (7,620) (27,349) (3,119,941) 130,038 287,373 $417,411	2020 $ - 478 8,771
		(230,433)
		55,886,938 (55,636,252) 6,900,058 (6,150,000) 1,996,865 2,250,000 (3,960,000) 200,721 (1,100,000) (7,527) (47,512)
		333,291
		662,901 67,028
		$729,929

(Concluded)

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

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED JUNE 30, 2021 AND 2020 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise) (Reviewed, Not Audited)

1. GENERAL INFORMATION

Chung Hung Steel Corporation (the “Corporation”) was incorporated in September 1983 and started operations in September 1985. It mainly manufactures and sells steel products, such as cold and hot rolled coils and steel pipes. Within these notes to the consolidated financial statement, the Corporation and its subsidiaries are hereto forth referred to as the “Group”.

The Corporation’s shares have been listed on the Taiwan Stock Exchange since February 1992.

As of June 30, 2021, and 2020, China Steel Corporation (“CSC”), the Corporation’s parent and major shareholder (40.60%), controls the Corporation’s management and operations.

The consolidated financial statements are presented in the Corporation’s functional currency, the New Taiwan Dollar.

2. APPROVAL OF FINANCIAL STATEMENTS

The consolidated financial statements were reported to the Corporation’s board of directors and approved for issue on August 3, 2021.

3. APPLICATION OF NEW AND AMENDED STANDARDS AND INTERPRETATIONS

a. Initial application of 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 application of the amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the IFRSs endorsed and issued into effect by the FSC did not have any material impact on the Corporation and its subsidiaries’ (the Group) accounting policies.

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

New IFRSs “Annual Improvements to IFRS Standards 2018-2020” Amendments to IFRS 3 “Reference to the Conceptual Framework” 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	Effective Date Announced by IASB (Note 1)
	January 1, 2022 (Note 2) January 1, 2022 (Note 3) To be determined by IASB January 1, 2023 January 1, 2023 (Continued)

New IFRSs 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” 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 (Note 1)
	January 1, 2023 January 1, 2023 (Note 6) January 1, 2023 (Note 7) January 1, 2023 (Note 8) January 1, 2022 (Note 4) January 1, 2022 (Note 5) (Concluded)

New IFRSs
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”

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 (Note 1)

January 1, 2023
January 1, 2023 (Note 6)
January 1, 2023 (Note 7)
January 1, 2023 (Note 8)
January 1, 2022 (Note 4)
January 1, 2022 (Note 5)
(Concluded)

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 to IFRS 9 are 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” are 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” are applied retrospectively for annual reporting periods beginning on or after January 1, 2022.
Note 3: The amendments are applicable to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after January 1, 2022.
Note 4: 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 5: The amendments are applicable to contracts for which the entity has not yet fulfilled all its obligations on January 1, 2022.
Note 6: The amendments will be applied prospectively for annual reporting periods beginning on or after January 1, 2023.
Note 7: 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 8: Except that deferred taxes 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 reported to the board of directors for issue, the Group is in the process of assessing the impact of the impending initial application of the aforementioned and other standards and the amendments to interpretations on their financial position and results of operations. Disclosures will be provided after a detailed review of the impact has been completed.

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4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICY

For readers’ convenience, the accompanying consolidated financial statements have been translated into English from the original Chinese version prepared and used in the ROC. If inconsistencies arise between the English version and the Chinese version or if differences arise in the interpretations between the two versions, the Chinese version of the consolidated financial statements shall prevail.

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 IAS 34 “Interim Financial Reporting” as endorsed and issued into effect by the FSC. The consolidated financial statements do not present full disclosures required for a complete set of IFRSs annual financial statements.

b. Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Corporation and the entities controlled by the Corporation (i.e. its subsidiaries). All intra-Group transactions, balances, income and expenses are eliminated in full upon consolidation.

The consolidated entities were as follows:

Investor Investee Main Businesses Chung Hung Steel Corporation Ltd. Hung Kao Investment Corporation General investment	Percentage of Ownership (%)
	June 30, 2021 December 31, 2020 June 30, 2020 100 100 100

c. Other significant accounting policies

Except for the following, refer to the summary of significant accounting policy in the consolidated financial statements for the year ended December 31, 2020.

1) Retirement benefits

Pension cost for an interim period is calculated on a year-to-date basis by using the actuarially determined pension cost rate at the end of the prior financial year, adjusted for significant market fluctuations since that time and for significant plan amendments, settlements, or other significant one-off events.

2) Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax. Interim period income taxes are assessed on an annual basis and calculated on an interim period’s pre-tax income by applying to the tax rate that would be applicable to expected total annual earnings.

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

The same critical accounting judgments and key sources of estimation uncertainty of consolidated financial statements have been followed in these consolidated financial statements as those applied in the preparation of the consolidated financial statements for the year ended December 31, 2020.

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6. CASH

Cash on hand Checking accounts and demand deposits	June 30, 2021 $ 640 416,771 $ 417,411	December 31, 2020 $ 640 286,733 $ 287,373	June 30, 2020 $ 640 729,289
			$ 729,929

7. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS - CURRENT

Financial assets mandatorily classified as at FVTPL Emerging market shares	June 30, 2021 December 31, 2020 $ 311,266 $ 242,410	June 30, 2020 $ 159,739

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

Current Domestic Listed shares Noncurrent Domestic listed shares Domestic unlisted shares	June 30, 2021 $ 1,311,126 $ 39,758 49,302 $ 89,060	December 31, 2020 $ 819,454 $ 24,848 43,345 $ 68,193	June 30, 2020 $ 685,361
			$ 20,782 43,237
			$ 64,019

RisLink Venture Capital Corp. conducted capital reduction and refunded NT$1,934 thousand in September 2020.

9. ACCOUNTS RECEIVABLE AND OTHER RECEIVABLES

Accounts receivable Accounts receivable – non-related parties Accounts receivable – related parties	June 30, 2021 $ 983,394 $ 44,274	December 31, 2020 $ 830,087 $ 117,238	June 30, 2020 $ 1,192,378 $ 21,643 (Continued)

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Other receivables (including related parties) Settlement receivable Receivables from disposal of scrap Dividend receivable Discount receivable Others	June 30, 2021 $ 127,864 50,281 44,271 8,882 5,161 $ 236,459	December 31, 2020 $ 11,912 32,961 - 886 234 $ 45,993	June 30, 2020 $ - 27,327 - 505,173 1,476 $ 533,976

(Concluded)

a. Accounts receivable

The Group allows an average credit period of 30 days (the aging of receivables from sales of goods is based upon the date of examination and acceptance of the goods settlement is monthly or 60 days after shipment date). Refer to Note 28 for credit risk management policies.

The Group applies the simplified approach to providing for expected credit losses prescribed by IFRS 9, which permits the use of lifetime expected loss provision for accounts receivables. The expected credit losses on accounts receivables are estimated using a provision matrix by reference to past default experience of the debtor and an analysis of the debtor’s current financial position. As the Group’s historical credit loss experience does not show significantly different loss patterns for different customer segments, the provision for loss allowance based on past due status is not further distinguished according to the Group’s different customer base.

The following table details the loss allowance of accounts receivable based on the Group’s provision matrix.

June 30, 2021

Expected credit loss rate (%) Gross carrying amount Loss allowance (Lifetime ECL) Amortized cost December 31, 2020 Expected credit loss rate (%) Gross carrying amount Loss allowance (Lifetime ECL) Amortized cost June 30, 2020 Expected credit loss rate (%) Gross carrying amount Loss allowance (Lifetime ECL) Amortized cost	Not Past Due - $ 1,027,668 - $ 1,027,668 Not Past Due - $ 947,325 - $ 947,325 Not Past Due - $ 1,214,021 - $ 1,214,021	1 to 30 Days - $ - - $ - 1 to 30 Days - $ - - $ - 1 to 30 Days - $ - - $ -	31 to 60 Days 6 - $ - - $ - 31 to 60 Days 6 - $ - - $ - 31 to 60 Days 6 - $ - - $ -	1 to 180 Days 1 - $ - - $ - 1 to 180 Days 1 - $ - - $ - 1 to 180 Days 1 - $ - - $ -	81 to 365 Days O - $ - - $ - 81 to 365 Days O - $ - - $ - 81 to 365 Days O - $ - - $ -	ver 365 Days 100 $ - - $ - ver 365 Days 100 $ - - $ - ver 365 Days 100 $ - - $ -	Total $ 1,027,668 -
							$ 1,027,668
							Total $ 947,325 -
							$ 947,325
							Total $ 1,214,021 -
							$ 1,214,021

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The amounts of accounts receivable from single customer that exceed 10% of total accounts receivable were as follows:

A company B company C company D company E company F company G company	June 30, 2021 $ 209,076 181,514 148,919 - - - - $ 539,509	December 31, 2020 $ 95,493 186,520 88,499 147,430 - - - $ 517,942	June 30, 2020 $ 76,425 46,953 45,068 2,387 305,625 203,520 192,975 $ 872,953

The Corporation entered into accounts receivable factoring contract (without recourse). Under the contract, the Corporation is authorized to sell accounts receivable to Bank upon the delivery of products to customers and is required to complete related formalities on the next banking day. Under this contract, the Corporation does not bear the risk of the uncollectability of the accounts receivable.

Receivables sold for the six months ended June 30, 2021 and 2020 were as follows:

Buyer of Accounts Receivable For the Six Months Ended June 30,2021 Mega Bank Bank of Taiwan Bank of Taiwan For the Six Months Ended June 30, 2020 Mega Bank Bank of Taiwan Bank of Taiwan	Advances Received at Period - Beginning $ 601,245 67,274 14,577 $ 683,096 $ 926,731 - 124,214 $ 1,050,945	Receivables Sold $ 788,011 89,676 23,927 $ 901,614 $ 1,203,222 102,030 148,556 $ 1,453,808	Amounts Collected Advances Received at Period - End Interest Rates on Advances Received (%) Credit Line $ 753,478 $ 635,778 1.03 NT$817 million 81,515 75,435 1.03 NT$200 million 16,793 21,711 1.46 USD20 million $ 851,786 $ 732,924 $ 1,212,393 $ 917,560 1.12 NT$3 billion 37,221 64,809 1.12 NT$200 million 127,351 145,419 2.61 USD20 million $ 1,376,965 $ 1,127,788

The above credit lines are revolving.

b. Other receivables

The Group applies the approach to providing for expected credit losses prescribed by IFRS 9, which permits the use of lifetime expected loss provision for other receivable. The expected credit losses on other receivables are estimated using expected credit loss rate based on the other receivables overdue days. As of June 30, 2021, December 31, 2020 and June 30, 2020, there was no allowance for doubtful accounts.

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10. INVENTORIES

Raw materials Finished goods Supplies Work in progress Others Raw materials and supplies in transit	June 30, 2021 $ 1,778,424 3,025,159 356,482 817,257 14,487 87,123 $ 6,078,932	December 31, 2020 $ 1,608,738 1,764,310 368,565 488,875 3,872 2,060 $ 4,236,420	June 30, 2020 $ 3,099,187 1,392,315 460,205 307,173 2,665 57
			$ 5,261,602

The cost of inventories recognized as operating costs for the three months and six months ended June 30, 2021 and 2020 was NT$11,146,049 thousand, NT$7,851,255 thousand, NT$19,904,323 thousand and NT$17,549,096 thousand, respectively, including loss on inventory value decline of NT$2,994 thousand, loss on inventory value decline of NT$29,439 thousand, reversal of loss of NT$20,465 thousand and reversal of loss of NT$115,187 thousand, respectively.

11. PREPAYMENTS

Input tax Prepayments for purchases Tax overpaid retained for offsetting future tax payable Others 12. OTHER FINANCIAL ASSETS	June 30, 2021 $ 105,315 42,184 - 12,698 $ 160,197	December 31, 2020 $ 104,098 41,340 - 5,523 $ 150,961	June 30, 2020 $ 90,620 42,957 39,622 8,833 $ 182,032

Current Pledged time deposits (Note 30) One-year time deposits	June 30, 2021 $ 300,000 2,800 $ 302,800	December 31, 2020 $ 300,000 1,700 $ 301,700	June 30, 2020 $ 300,000 1,700 $ 301,700

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13. INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD

			June 30,	December	December	31,		June 30,	June 30,
			2021		2020			2020
Material associates
Transglory Investment Corp. (TIC)		$	4,270,511	$	2,669,716		$	2,168,027
Associates that are not individually material			203,869			-			-
		$	4,474,380	$	2,669,716		$	2,168,027
a. Material associates
					Percentage of Ownership				and
						Voting Rights (%)
					June 30,		December		June 30,
Name of Associate	Nature of Activities	Principal Place of Business			2021		31, 2020		2020
TIC	General investment	Taiwan			40.91		40.91		40.91

The summarized financial information below represents amounts shown in the associates’ financial statements prepared in accordance with IFRSs adjusted by the Group for equity accounting purposes.

TIC

Current assets Noncurrent assets Current liabilities Equity Proportion of the Group’s ownership Equity attributable to the Group Carrying amount Operating revenue Net loss for the period Other comprehensive income Total comprehensive income for the period Comprehensive income attributable to the Group	June 30, 2021 $ 7,489 10,619,034 ( 188,208) $ 10,438,315 (%) 40.91 $ 4,270,511 $ 4,270,511 For the Three Months Ended June 30	December 31, 2020 June 30, 2020 $ 2,470 $ 13,393 6,598,420 5,493,606 ( 75,063) ( 207,495) $ 6,525,827 $ 5,299,504 40.91 40.91 $ 2,669,716 $ 2,168,027 $ 2,669,716 $ 2,168,027 For the Six Months Ended June 30 2021 2020 $ - $ - ($ 5,754) ($ 7,722) 4,026,329 ( 867,846) $ 4,020,575 ($ 875,568) $ 1,645,066 ($ 358,195)	December 31, 2020 June 30, 2020 $ 2,470 $ 13,393 6,598,420 5,493,606 ( 75,063) ( 207,495) $ 6,525,827 $ 5,299,504 40.91 40.91 $ 2,669,716 $ 2,168,027 $ 2,669,716 $ 2,168,027 For the Six Months Ended June 30 2021 2020 $ - $ - ($ 5,754) ($ 7,722) 4,026,329 ( 867,846) $ 4,020,575 ($ 875,568) $ 1,645,066 ($ 358,195)
	2021 2020 $ - $ - ($ 2,877) ($ 3,853) 3,714,447 474,603 $ 3,711,570 $ 470,750 $ 1,518,652 $ 192,584		2020 $ - ($ 7,722) ( 867,846) ($ 875,568) ($ 358,195)

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b. Information about associates that are not individually material was as follows:

Net profit for the period Other comprehensive income Total comprehensive income		For the Three Months Ended June 30 2021 2020 $ 821 $ - 1,585 - $ 2,406 $ -		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 821 1,585 $ 2,406		2021 $ 914 2,955 $ 3,869	2020 $ - - $ -

The whole shareholding of the Group, parent entity and fellow subsidiaries in above-mentioned investee companies is more than 20%; therefore, the investments are evaluated by using the equity method.

Refer to Table 3 “Information on Investments” for the nature of main business, principle of business and countries of incorporation of associates that are not individually material.

14. PROPERTY, PLANT AND EQUIPMENT

For the Six Months Ended June 30, 2021

Cost Balance at January 1, 2021 Additions Disposals Balance at June 30, 2021 Accumulated depreciation and impairment Balance at January 1, 2021 Depreciation expense Disposals Balance at June 30, 2021 Carrying amount at December 31, 2020 Carrying amount at June 30, 2021	Land $ 3,988,983 - - $ 3,988,983 $ - - - $ - $ 3,988,983 $ 3,988,983	Buildings Machinery and Equipment $ 5,001,703 $ 22,862,804 10,378 215,982 - - $ 5,012,081 $ 23,078,786 $ 2,008,941 $ 19,637,206 66,081 176,270 - - $ 2,075,022 $ 19,813,476 $ 2,992,762 $ 3,225,598 $ 2,937,059 $ 3,265,310	Other Equipment $ 4,483,434 9,752 ( 9,838) $ 4,483,348 $ 4,050,064 48,602 ( 9,838) $ 4,088,828 $ 433,370 $ 394,520	Spare Parts $ 1,291,199 107,575 ( 5,517) $ 1,393,257 $ 894,626 83,370 ( 5,517) $ 972,479 $ 396,573 $ 420,778	Construction in Progress and Equipment to be Inspected $ 125,357 ( 74,935 ) - $ 50,422 $ - - - $ - $ 125,357 $ 50,422	Total $ 37,753,480 268,752 ( 15,355) $ 38,006,877 $ 26,590,837 374,323 ( 15,355) $ 26,949,805 $ 11,162,643 $ 11,057,072

For the Six Months Ended June 30, 2020

Cost Balance at January 1, 2020 Additions Disposals Balance at June 30, 2020 Accumulated depreciation Balance at January 1, 2020 Depreciation expense Disposals Balance at June 30, 2020 Carrying amount at June 30, 2020	Land $ 3,988,983 - - $ 3,988,983 $ - - - $ - $ 3,988,983	Buildings Machinery and Equipment $ 4,993,389 $ 22,734,037 1,633 86,690 - ( 13,377) $ 4,995.022 $ 22,807,350 $ 1,877,331 $ 18,539,349 65,735 349,186 - ( 1,832) $ 1,943,066 $ 18,886,703 $ 3,051,956 $ 3,920,647	Other Equipment $ 4,419,879 24,530 ( 5,251) $ 4,439,158 $ 3,938,749 63,097 ( 5,251) $ 3,996,595 $ 442,563	Spare Parts $ 1,428,295 39,336 ( 118,276) $ 1,349,355 $ 773,196 103,388 ( 118,276) $ 758,308 $ 591,047	Construction in Progress and Equipment to be Inspected $ 116,329 55,270 - $ 171,599 $ - - - $ - $ 171,599	Total $ 37,680,912 207,459 ( 136,904) $ 37,751,467 $ 25,128,625 581,406 ( 125,359) $ 25,584,672 $ 12,166,795

Depreciation of the rollers that belong to the cold-rolling departments, the hot rolling department and the skin pass mill of the pickling & galvanizing mill department is calculated based on their level of wear; depreciation of other assets is recognized based on the following useful lives:

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Buildings Facility 5-50 years Main structure 31-60 years Machinery and equipment Power equipment 3-30 years High-temperature equipment 5-18 years Other equipment Computer equipment 3-10 years Office, air condition and extinguishment equipment 3-20 years Transportation equipment 5-16 years Others 3-18 years Tank 10 years

The Corporation bought farmlands for warehouse at the Jia Xing Section and Quing Shui Section of the Gangshan District in Kaohsiung City. However, certain regulations prohibit the Corporation from registering the title of these farmlands in the Corporation’s name; thus, the registration was made in the name of an individual person. The individual person consented to fully cooperate with the Corporation in changing the land title in the future and pledged the land to the Corporation as collateral. As of June 30, 2021, December 31, 2020 and June 30, 2020, the book value of those remaining farmlands recognized as land were NT$55,433 thousand, respectively.

15. LEASE ARRANGEMENTS

a. Right-of-use assets

Carrying amounts	June 30, 2021 $ 62,021 8,583 $ 70,604 For the Three Months Ended June 30	June 30, 2021 $ 62,021 8,583 $ 70,604 For the Three Months Ended June 30	December 31, 2020 June 30, 2020 $ 68,233 $ 74,356 10,097 11,612 $ 78,330 $ 85,968 For the Six Months Ended June 30 2021 2020 $ - $ 18,789 $ 6,212 $ 6,207 1,514 1,515 $ 7,726 $ 7,722	December 31, 2020 June 30, 2020 $ 68,233 $ 74,356 10,097 11,612 $ 78,330 $ 85,968 For the Six Months Ended June 30 2021 2020 $ - $ 18,789 $ 6,212 $ 6,207 1,514 1,515 $ 7,726 $ 7,722	December 31, 2020 June 30, 2020 $ 68,233 $ 74,356 10,097 11,612 $ 78,330 $ 85,968 For the Six Months Ended June 30 2021 2020 $ - $ 18,789 $ 6,212 $ 6,207 1,514 1,515 $ 7,726 $ 7,722
Land Transportation equipment Additions to right-of-use assets Depreciation charge for right-of-use assets Land Transportation equipment
			$

	2021 $ 3,106 757 $ 3,863	2020 $ 3,103 758 $ 3,861		2021 $ - $ 6,212 1,514 $ 7,726	2020 $ 18,789 $ 6,207 1,515 $ 7,722

Except for the above-mentioned additions and depreciation expenses, there were no material subleases and impairment for the six months ended June 30, 2021 and 2020.

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b. Lease liabilities

Carrying amounts Current Non-current Range of discount rate for lease liabilities was as Land(%) Transportation equipment(%)	June 30, 2021 $ 15,317 $ 56,191 follows: June 30, 2021 0.85-1.31 0.76	December 31, 2020 $ 15,230 $ 63,898 December 31, 2020 0.85-1.31 0.76	June 30, 2020 $ 15,130 $ 71,449 June 30, 2020 1.10-1.31 0.76

c. Material lease activities and terms

The Corporation leases land for the use of steel products storing with lease terms of 5-10 years. The Corporation does not have bargain purchase options to acquire the leasehold land at the end of the lease terms.

d. Other lease information

Lease arrangements under operating leases for the leasing out of investment properties are set out in Note 16.

Expenses relating to short-term leases Expenses relating to low-value assets leases Total cash outflow for leases		For the Three Months Ended June 30	For the Three Months Ended June 30		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 2,418 $ 306	2020 $ 5,722 $ 334		2021 $ 5,049 $ 667 ($ 13,785)	2020 $ 11,451 $ 640 ($ 20,160)

For transportation equipment which qualify as short-term leases and other equipment which qualify as low-value asset leases, the Group has elected to apply the recognition exemption and thus did not recognize right-of-use assets and lease liabilities for these leases.

16. INVESTMENT PROPERTIES

For the six months ended June 30, 2021

Cost Balance at January 1 and June 30, 2021	Land $ 5,959,074	Buildings $ 41,067	Total $ 6,000,141 (Continued)

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Accumulated depreciation Balance at January 1, 2021 Depreciation expense Balance at June 30, 2021 Carrying amount at December 31, 2020 Carrying amount at June 30, 2021 For the six months ended June 30, 2020 Cost Balance at January 1 and June 30, 2020 Accumulated depreciation Balance at January 1, 2020 Depreciation expense Balance at June 30, 2020 Carrying amount at June 30, 2020	Land $ - - $ - $ 5,959,074 $ 5,959,074 Land $ 5,959,074 $ - - $ - $ 5,959,074	Buildings $ 16,956 444 $ 17,400 $ 24,111 $ 23,667 Buildings $ 41,067 $ 16,068 444 $ 16,512 $ 24,555	Total $ 16,956 444 $ 17,400 $ 5,983,185 $ 5,982,741 (Concluded) Total $ 6,000,141 $ 16,068 444 $ 16,512 $ 5,983,629

The Corporation signed a land lease contract of Long-Dong Block in Kaohsiung with non-related parties in June 30, 2010 and operating terms 20 years and according to the contract rent is charged monthly. The rent revenue recognized as other income for the three months ended June 30, 2021 and 2020 and for the six months ended June 30, 2021 and 2020 were NT$20,716 thousand, NT$20,330 thousand, NT$41,432 thousand and NT$40,659 thousand, respectively. As of June 30, 2021, December 31, 2020 and June 30, 2020, according to the contract, the Corporation received guarantee from the lessee were all NT$35,000 thousand.

As of June 30, 2021, December 31, 2020 and June 30, 2020, accounting to the abovementioned lease contract, the Corporation had received the amount of notes receivable and recognized as unearned rent revenue as follows:

Notes receivable received Less: unearned rent revenue Carrying amount		June 30, 2021 $ 7,227 7,227 $ -	December 31, 2020 $ 50,587 50,587 $ -		June 30, 2020 $ 7,085 7,085
					$ -

20 -

The maturity analysis of lease payments receivable under operating leases of investment properties were as follows:

Year 1 Year 2 Year 3 Year 4 Year 5 Later than 5 years	June 30, 2021 December 31, 2020 $ 91,743 $ 87,569 85,802 84,956 87,400 86,618 89,108 88,232 90,890 89,996 499,230 544,824 $ 944,173 $ 982,195	June 30, 2020 $ 91,224 84,118 85,802 87,400 89,108 590,120 $ 1,027,772

The land and buildings of investment properties are depreciated on a straight-line basis over 31-55 years useful lives.

The fair value of the investment properties was arrived at on the basis of valuations carried out in November 2019 by real estate appraiser and on the basis of information at the Ministry of the Interior’s real estate transaction database website. Appraised lands and buildings were evaluated using Level 3 inputs under market approach, cost approach, income approach, and land development analysis approach. The important assumptions and fair value were as follows:

Fair value Expense rate (%) Depreciation rate (%)	June 30, 2021 $ 9,996,358 25.14 1.90-2.57	December 31, 2020 $ 9,996,358 25.14 1.90-2.57	June 30, 2020 $ 9,996,358
			25.14 1.90-2.57

All investment properties are owned by the Group and had not been pledged to secure borrowings.

17. BORROWINGS

a. Short-term borrowings and bank overdrafts

Letters of credit Unsecured loans Bank overdrafts (Note 30) Loans from related parties (Note 29) Interest rate (%)	June 30, 2021 December 31, 2020 $ 989,419 $ 50,000 400,000 200,000 - 154,630 - - $ 1,389,419 $ 404,630 0-0.87 0.32-0.75	June 30, 2020 $ 1,128,101 1,650,000 227,452 2,400,000 $ 5,405,553 0.32-0.96

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b. Short-term bills payable

Commercial paper Less: Unamortized discounts Interest rate (%)	June 30, 2021 December 31, 2020 $ 100,000 $ 3,600,000 10 423 $ 99,990 $ 3,599,577 0.32 0.35-0.36	June 30, 2020 $ 2,550,000 392 $ 2,549,608 0.58-0.60

On June 30, 2021, December 31, 2020 and June 30, 2020, all commercial papers were non-guarantee commercial paper.

c. Long-term borrowings

Credit bank loans Due on various dates through December 2024 Interest rate (%) d. Long-term bills payable Commercial papers Less: Unamortized discount Interest rate (%)	June 30, 2021 December 31, 2020 $ 1,400,000 $ 2,000,000 0.75-0.79 0.75-0.92 June 30, 2021 December 31, 2020 $ 1,140,000 $ 1,110,000 500 326 $ 1,139,500 $ 1,109,674 0.62-0.73 0.73-0.91	June 30, 2020 $ 2,900,000 0.75-0.81 June 30, 2020 $ 1,710,000 141 $ 1,709,859 0.75-0.96

Commercial papers have revolving credit lines within the payment terms according to the contracts and need to be utilized to some extent. As of June 30, 2021 and December 31, 2020, all commercial papers were non-guarantee commercial paper. The borrowing from International Bills Financial Corporation was secured by Bangkok Bank as of June 30, 2020.

18. BONDS PAYABLE

Unsecured domestic bonds Less: Issuance cost of bonds payable	June 30, 2021 December 31, 2020 $ 3,000,000 $ 3,000,000 4,394 4,961 $ 2,995,606 $ 2,995,039	June 30, 2020 $ 2,000,000 3,135 $ 1,996,865

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The major terms of unsecured domestic bonds are as follows:

		Coupon
Issuance Period	Total Amount	Rate (%)	Repayment and Interest Payment
March 2020 to March 2025	$ 2,000,000	0.78	Repayable in March 2025; interest payable
			annually.
September 2020 to September	1,000,000	0.65	Repayable in September 2025; interest
2025			payable annually.

19. ACCOUNTS PAYABLE

Accounts payable Operating - non related parties Operating - related parties	June 30, 2021 December 31, 2020 $ 460,582 $ 27,500 $ 809,322 $ 313,224	June 30, 2020 $ 22,309
		$ 98,532

The Group has financial risk management policies in place to ensure that all payables are paid within the pre-agreed credit terms.

20. OTHER PAYABLES

Dividends Salaries and incentive bonus Employees’ compensation and remuneration of directors Utilities Freight Outsourced repair and construction Export fees Processing fee Others	June 30, 2021 December 31, 2020 $ 430,663 $ - 402,326 289,532 250,080 36,469 71,843 59,229 29,951 27,497 26,347 34,572 15,701 26,007 11,520 23,367 111,298 83,591 $ 1.349.729 $ 580,264	June 30, 2020 $ - 142,302 1,811 69,357 24,897 31,527 55,150 29,364 116,826
		$ 471,234

21. RETIREMENT BENEFIT PLANS

Employee benefit expenses in respect of the Corporation and its subsidiaries’ defined benefit retirement plans were calculated using the actuarially determined pension cost discount rate as of December 31, 2020 and 2019, and the amounts were NT$5,000 thousand, NT$5,653 thousand, NT$9,999 thousand and NT$11,306 thousand for the three months ended June 30, 2021 and 2020, and for the six months ended June 30, 2021 and 2020, respectively.

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22. EQUITY

a. Ordinary shares

Numbers of shares authorized (in thousands) Shares authorized Numbers of shares issued and fully paid (in thousands) Shares issued	June 30, 2021 2,043,160 $ 20,431,600 1,435,544 $ 14,355,444	December 31, 2020 2,043,160 $ 20,431,600 1,435,544 $ 14,355,444	June 30, 2020 2,043,160 $ 20,431,600 1,435,544 $ 14,355,444

In June 2009, the Corporation revised the number of its authorized shares to 3,000,000 thousand shares upon obtaining the approval in the shareholders’ meeting. The number of the authorized shares, which is approved by Department of Commerce, is 2,043,160 thousand shares at present.

Fully paid ordinary shares, which have a par value NT$10, carry one vote per share and the right to dividends.

b. Capital surplus

		June 30,	December 31,	June 30,
		2021	2020	2020
Additional paid-in	capital	$ 903	$ 903	$ 903

In 2009, CSC had transferred its treasury stocks to its employees and subsidiaries. The Corporation recognized a compensation cost and capital surplus of NT$743 thousand. In July 2011, CSC issued ordinary shares for cash capital. Under the Company Law, CSC should reserve 10% of the stocks for its employees and subsidiaries. The Corporation recognized NT$160 thousand of compensation cost and capital surplus.

Such capital surplus may be used only to offset deficits.

c. Retained earnings and dividend policy

The Corporation’s Articles of Incorporation provide that 10% of the annual net income less any deficit should be appropriated as a legal reserve; a certain percentage should be appropriated as special reserve; the remainder may be declared as dividends or retained as proposed by the Corporation’s board of directors and approved in the shareholders’ meetings.

In June 2020, the shareholders’ meeting approved a resolution to allocate no less than 30% of the distributable surplus every year to distribute dividends. However, if the cumulative distributable surplus is less than 3% of the paid-in capital, it may not be distributed.

The Corporation is in a mature steel industry. Thus, dividends will be appropriated in cash or in stock at an appropriate ratio, with cash dividends to be at least 50% of total dividends.

Under the Company Law, legal reserve should be appropriated from retained earnings until its balance equals the Corporation’s paid-in capital. Legal reserve may be used to offset a 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.

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The appropriations of earnings for 2020 and 2019 had been proposed by the board of directors in February 2021 and approved in the shareholders’ meeting in June 2020, respectively. The appropriations and dividends per share were as follows:

Legal reserve Special reserve (reversal) Cash dividends	Appropriation of Earnings 2020 2019 $ 54,064 $ 118 ( 123,739) 51,971 430,663 -		Dividend Per Share (NT$)	Dividend Per Share (NT$)
			2020 $ 0.3	2019 $ -

The Corporation suspends its originally scheduled shareholders’ meeting in response to the FSC’s announcement: “For pandemic prevention, the FSC demands public companies to postpone their shareholders’ meetings”. However, the voting result by way of electronic transmission regarding the appropriation of earnings for 2020 reached the legal resolution threshold and the Corporation adjusted related amount accordingly.

Information about the appropriation of earnings and offsetting deficits, proposed by the shareholders’ meetings and the Corporation’s board of directors, is available on the Market Observation Post System website of the Taiwan Stock Exchange.

d. Exchange differences on translating foreign operations

Balance, beginning of period Recognized during the period Share from associates accounted for using the equity method Balance, end of period		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ - 55 $ 55	2020 $ - - $ -

e. Unrealized gains and losses on financial assets at fair value through other comprehensive income

Balance, beginning of period Recognized during the period Unrealized gains and losses - equity instruments Share from associates accounted for using the equity method Other comprehensive income recognized in the period Cumulative unrealized gains and losses of equity instruments transferred to retained earnings due to disposal Balance, end of period		For the Six Months Ended June 30
		2021 2020 ($ 425,839) ($ 549,578) 512,539 ( 110,769) 1,605,281 (355,036) 2,162,820 (465,805) ( 4,679) - $1,732,302 ($1,015,383)

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23. OPERATING REVENUES

a. Contract balances

Accounts receivable Contract liabilities - current Sale of goods	June 30, 2021 December 31, 2020 $ 1,027,668 $ 947,325 $ 70,218 $ 57,283	June 30, 2020 $ 1,214,021 $ 24,911	January 1, 2020 $ 511,750 $ 285,052

b. Disaggregation of revenue

For the Six Months Ended June 30, 2021

Type of goods or services Sale of goods Rendering of services Others For the Six Months Ended June 30, 2020		Reportable segments	Reportable segments
		Chung Hung $ 23,896,381 285,045 42,031 $ 24,223,457	Others $ - 4,428 - $ 4,428	Total $ 23,896,381 289,473 42,031 $ 24,227,885

Type ofgoods orservices Sale of goods Rendering of services Others		Reportable segments	Reportable segments
		Chung Hung $ 17,721,203 198,655 29,447 $ 17,949,305	Others $ - - - $ -	Total $ 17,721,203 198,655 29,447 $ 17,949,305

24. PROFIT (LOSS) BEFORE INCOME TAX

Profit (Loss) before income tax consisted of following items:

a. Other income

Rental income Government grants income Dividend income Others		For the Three Months Ended June 30	For the Three Months Ended June 30		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 21,647 3,311 450 2,434 $ 27,842	2020 $ 21,259 4,312 625 677 $ 26,873		2021 $ 43,169 4,787 450 6,782 $ 55,188	2020 $ 42,376 7,567 8,771 4,820 $ 63,534

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b. Other gains and losses

Net foreign exchange gain Loss on disposal of property, plant and equipment Loss arising from financial assets at fair value through profit or loss Fees Others		For the Three Months Ended June 30 2021 2020 $ 4,296 $ 951 - - 400,178 ( 1,566) ( 2,222) ( 2,875) ( 474) ( 1,102) $ 401,778 ($ 4,592)		For the Six Months Ended June 30
				2021 2020 $ 13,339 $ 6,043 - ( 11,545) 344,797 ( 21,612) ( 5,327) ( 6,069) ( 1,043) ( 1,239) $ 351,766 ($ 34,422)

The components of net foreign exchange gain were as follows:

Foreign exchange gain Foreign exchange loss Net exchange gain		For the Three Months Ended June 30 2021 2020 $ 29,416 $ 14,260 ( 25,120) ( 13,309) $ 4,296 $ 951		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 29,416 ( 25,120) $ 4,296		2021 $ 45,576 ( 32,237) $ 13,339	2020 $ 34,689 ( 28,646) $ 6,043

c. Finance costs

Interest on bank overdrafts and loans Interest on loans from related parties (Note 29) Interest on lease liabilities Total interest expense financial liabilities measured at amortized cost Less: Amounts included in the cost of qualifying assets		For the Three Months Ended June 30 2021 2020 $ 10,366 $ 20,363 - 3,735 219 266 10,585 24,364 116 380 $ 10,469 $ 23,984		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 10,366 - 219 10,585 116 $ 10,469		2021 $ 21,998 - 449 22,447 393 $ 22,054	2020 $ 41,564 7,969 543 50,076 676 $ 49,400

Information about capitalized interest was as follows:

Capitalized amounts Capitalized annual rates (%)	For the Three Months Ended June 30 2021 2020 $ 116 $ 380 0.63-0.72 0.71-0.76	For the Six Months Ended June 30
		2021 2020 $ 393 $ 676 0.59-0.72 0.71-0.83

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d. Depreciation

Property, plant and equipment Investment properties Right-of-use assets Analysis of depreciation by function Operating costs Operating expenses Deduction of other income		For the Three Months Ended June 30 2021 2020 $ 189,360 $ 284,585 222 222 3,863 3,861 $ 193,445 $ 288,668 $ 191,424 $ 267,237 1,799 21,209 222 222 $ 193,445 $ 288,668		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 189,360 222 3,863 $ 193,445 $ 191,424 1,799 222 $ 193,445		2021 $ 374,323 444 7,726 $ 382,493 $ 378,455 3,594 444 $ 382,493	2020 $ 581,406 444 7,722 $ 589,572 $ 547,128 42,000 444 $ 589,572

e. Operating expenses directly related to investment properties

			For the Three Months	For the Three Months	For the Three Months	For the Three Months		For the Six Months	For the Six Months	For the Six Months
			Ended	June 30				Ended June 30
			2021			2020		2021		2020
	Direct operating expenses of
	investment properties that
	generated rental income	$	2,790		$	2,726	$	5,659	$	5,544
	Direct operating expenses of
	investment properties that
	did not generate rental
	income		1,817			1,715		3,633		3,430
		$	4,607		$	4,441	$	9,292	$	8,974
f.	Employee benefits
			For the Three Months					For the Six Months
			Ended	June 30				Ended June 30
			2021			2020		2021		2020
	Short-term employee benefits
	Salaries	$	510,470	$		205,523	$	930,509	$	458,958
	Labor and health insurance		22,414			20,994		46,219		42,118
	Others		54,945			26,540		98,911		61,250
			587,829			253,057		1,075,639		562,326
	Post-employment benefits
	Defined contribution plans		6,507			6,398		12,934		12,787
	Defined benefit plans (Note
	21)		5,000			5,653		9,999		11,306
			11,507			12,051		22,933		24,093
		$	599,336	$		265,108	$	1,098,572	$	586,419
									(Continued)

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Analysis of employee benefits expense by function Operating costs Operating expenses		For the Three Months Ended June 30 2021 2020 $ 483,365 $ 221,625 115,971 43,483 $ 599,336 $ 265,108		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 483,365 115,971 $ 599,336		2021 $ 886,156 212,416 $ 1,098,572	2020 $ 490,882 95,537 $ 586,419 (Concluded)

g. Employees’ compensation and remuneration of directors

In accordance with the Corporation’s Articles of Incorporation, the Corporation distributes employees’ compensation and remuneration of directors at rates no less than 1‰ and no higher than 1%, respectively, of the pre-tax profit to deducting, employees’ compensation, and remuneration of directors less any deficit. There was no bonus to employees and remuneration to directors on June 30, 2020 because the Corporation had accumulated deficits.

For the three months ended June 30, 2021 and for the six months ended June 30, 2021, the employees’ compensation and remuneration of directors were as follows:

Amount	For the Three Months Ended June 30, 2021 $ 99,224 19,800	For the Six Months Ended June 30, 2021
		$ 177,889 35,550 4.24 0.85
Employees’ compensation Remuneration of directors Accrual rate
Employees’ compensation (%) Remuneration of directors (%)

The appropriations of employees’ compensation and remuneration of directors for the year ended December 31, 2020 and 2019, which were approved by the board of directors in February 2021 and 2020, respectively, were as follows:

Amount Employees’ compensation Remuneration of directors Accrual rate Employees’ compensation (%) Remuneration of directors (%)	For the Year Ended December 31
	2020 2019 $ 29,897 $ 11 5,638 - 5.30 0.10 1.00 -

29 -

If there is a change in the proposed amounts after the annual consolidated financial statements are authorized for issue, the difference is recorded as a change in accounting estimate and recognized in the next year.

There was no difference between the actual amounts of employees’ compensation and remuneration of directors paid and the amounts recognized in the consolidated financial statements for the year ended December 31, 2020 and 2019.

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

25. INCOME TAX

a. Income tax recognized in profit or loss

The major components of income tax expense were as follows:

Current tax In respect of the current period Income tax on unappropriated earnings		For the Three Months Ended June 30 2021 2020 $ 619 $ - 4,471 - $ 5,090 $ -		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 619 4,471 $ 5,090		2021 $ 752 4,471 $ 5,223	2020 $ - - $ -

b. No income tax was recognized in equity or other comprehensive loss.
c. Income tax assessments

The Group’s income tax returns through 2019 have been assessed by the tax authorities.

26. EARNINGS (LOSS) PER SHARE

Basic earnings (loss) per share Diluted earnings (loss) per share		For the Three Months Ended June 30 2021 2020 $ 1.59 ($ 0.25) $ 1.59 ($ 0.25)		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 1.59 $ 1.59		2021 $ 2.77 $ 2.77	2020 ($ 0.34) ($ 0.34)

30 -

The net profit (loss) and weighted average number of ordinary shares outstanding in the computation of earnings (loss) per share were as follows:

Net profit (loss) for the period

Attributable to owners of the Corporation		For the Three Months Ended June 30 2021 2020 $ 2,280,826 ($ 363,608)		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 2,280,826		2021 $ 3,980,844	2020 ($ 488,903)

Weighted average number of ordinary shares outstanding (in thousand shares)

Weighted average number of ordinary shares in computation of basic earnings (loss) per share Effect of dilutive potential ordinary shares: Employees’ compensation Weighted average number of ordinary shares used in computation of diluted earnings (loss) per share		For the Three Months Ended June 30 2021 2020 1,435,544 1,435,544 2,907 - 1,438,451 1,435,544		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 1,435,544 2,907 1,438,451		2021 1,435,544 3,461 1,439,005	2020 1,435,544 - 1,435,544

Since the Corporation offered to settle the compensation paid to employees in cash or shares, the Corporation assumed the entire amount of the compensation will 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.

Net loss for the six months ended June 30, 2020 was not included in the calculation of diluted earnings per share because of the anti-dilutive effect.

27. CAPITAL MANAGEMENT

The Group manages its capital to ensure that entities in the Group will be able to continue their operations while maximizing the return to shareholders through the optimization of the debt and equity balance.

28. FINANCIAL INSTRUMENTS

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

Management of the Group considers the carrying amount of financial assets and liabilities not carried at fair value approximates fair value.

b. Fair value of financial instruments that are measured at fair value on a recurring basis.
31 -

1) Fair value hierarchy

June 30,2021 Financial assets at fair value through profit or loss Emerging market shares Financial assets at FVOCI Domestic listed shares Domestic unlisted shares December31,2020 Financial assets at fair value through profit or loss Emerging market shares Financial assets at FVOCI Domestic listed shares Domestic unlisted shares June 30,2020 Financial assets at fair value through profit or loss Emerging market shares Financial assets at FVOCI Domestic listed shares Domestic unlisted shares	Level 1 $ - $1,350,884 - $1,350,884 $ - $ 844,302 - $ 844,302 $ - $ 706,143 - $ 706,143	Level 2 $ - $ - - $ - $ - $ - - $ - $ - $ - - $ -	Level 3 $ 311,266 $ - 49,302 $ 49,302 $ 242,410 $ - 43,345 $ 43,345 $ 159,739 $ - 43,237 $ 43,237	Total $ 311,266 $1,350,884 49,302 $1,400,186 $ 242,410 $ 844,302 43,345 $ 887,647 $ 159,739 $ 706,143 43,237 $ 749,380

There was no transfer between Level 1 and Level 2 for the six months ended June 30, 2021 and 2020.

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

Financial Assets Financial Assets at Fair Value at Fair value Through through Other Profit or Loss - Comprehensive Equity Income - Equity Instruments Instruments Total For the six months ended June 30, 2021 Balance, beginning of period $ 242,410 $ 43,345 $ 285,755 (Continued)

32 -

	Financial Assets	Financial Assets	Financial Assets	Financial Assets	Financial Assets
	at		Fair Value	at	Fair value
			Through	through Other
	Profit or Loss -			Comprehensive
			Equity	Income - Equity
		Instruments		Instruments			Total
Forthe six months ended June 30,2021
Total profit or loss
Recognized in profit or loss		$	344,797	$	-	$	344,797
Recognized in other comprehensive
income			-		5,957		5,957
Diposal	(		275,941)		-	(	275,941)
Balance, end of period	$		311,266	$	49,302	$	360,568
Unrealized gains and losses recognized in
other profit or loss	$		195,582	$	-	$	195,582
Forthe six months ended June 30,2020
Balance, beginning of period	$		181,351	$	44,843	$	226,194
Total profit or loss
Recognized in profit or loss	(		21,612)		-	(	21,612)
Recognized in other comprehensive
income			-	(	1,606)	(	1,606)
Balance, end of period	$		159,739	$	43,237	$	202,976
Unrealized gains and losses recognized in
other profit or loss	($		21,612)	$	-	($	21,612)

(Concluded)

3) Valuation techniques and inputs applied for the purpose of measuring Level 3 fair value measurement
- a) The fair value of emerging stocks was based on the closing price adjusted for liquidity risk premium.
- b) The fair value of unlisted stocks was based on the current net value.
c. Categories of financial instruments

		June 30,	December 31,	December 31,	June 30,
		2021		2020	2020
Financial assets
Fair value through profit or loss
Mandatorily at fair value through profit or
loss	$	311,266	$	242,410 $	159,739
Measured at amortized cost (see 1 below)		1,990,276		1,588,611	2,785,745
Financial assets at fair value through other
comprehensive income
Equity instruments		1,400,186		887,647	749,380
					(Continued)

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		June 30,	December 31,	June 30,
		2021	2020	2020
Financial liabilities
Measured at amortized cost (see 2 below)	$	9,547,531	$ 11,218,664	$ 15,350,078
				(Concluded)

1) The balances included financial assets measured at amortized cost, which comprise cash, accounts receivable (including related parties), other receivables (including related parties but not tax refund receivable), other financial assets and refundable deposits.
2) The balances included financial liabilities measured at amortized cost, which comprise short-term borrowings, short-term bills payable, accounts payable (including related parties), other payables (excluding dividends payable), refund liability, bonds payable, long-term borrowings, long-term bills payable, and guarantee deposits received.
d. Financial risk management objectives and policies

The Group’s major financial instruments include accounts receivable, investments accounted for using equity method, other financial assets, accounts payable, short-term borrowings, short-term bills payable, bonds payable, long-term borrowings (including current portion of long-term bank borrowings) and long-term bills payable. The Group’s financial management department provides service to the business units, coordinates domestic and international financial operations, prepares and analyzes internal risk reports to monitor and manage financial risks related to the operation of the Group. These risks include market risk (including exchange rate risk, interest rate risk and other price risk), credit risk and liquidity risk.

The Group sought to minimize the effects of these risks by using derivative financial instruments to hedge risk exposures. The use of financial derivatives was governed by the Group’s policies approved by the board of directors, which provided written principles on foreign exchange risk, interest rate risk, credit risk, the use of financial derivatives and non-derivative financial instruments, and the investment of excess liquidity. Compliance with policies and exposure limits was reviewed by the internal auditors on a continuous basis. The Group did not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.

1) Market risk

The main financial risks arising from operating activities are to the risk of change in foreign exchange rates (see (a) below), the risk of changes in interest rates (see (b) below) and the risk of other price (see (c) below).

There had been no change to the Group’s exposure to market risks or the manner in which these risks were managed and measured.

a) Foreign currency risk

The Group was exposed to foreign currency risk due to sales and purchases, denominated in foreign currencies. Exchange rate exposures were managed within approved policy parameters utilizing the same currency for accounts receivable and payable.

The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities and of the derivatives exposed foreign currency risk at the end of the reporting period are set out in Note 32.

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Sensitivity analysis

The Group was mainly exposed to the USD. The following table details the Group’s sensitivity to a 1% increase and decrease in the New Taiwan dollars (the functional currency) against the relevant foreign currencies. The sensitivity rate of 1% 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 included only the outstanding foreign currency denominated monetary items, refer to Note 32. A positive number below indicates an increase in profit or loss when the New Taiwan dollars strengthens by 1% against the relevant currency.

Profit before income tax	USD Impact (Note)
	For the Six Months Ended June 30
	2021 2020 ($ 8,399) $ 15,696

Note: This was mainly attributable to the exposure of outstanding USD cash, accounts receivables, accounts payable and other payables, which were not hedged at the balance sheet date.

b) Interest rate risk

The Group was exposed to interest rate risk because the Group borrowed funds at both fixed and floating interest rates.

The carrying amounts of the Group’s financial assets and liabilities with exposure to interest rates at the balance sheet date were as follows:

		June 30,	December 31,	December 31,		June 30,
		2021		2020		2020
Fair value interest rate risk
Financial liabilities	$	3,067,114	$	3,074,167	$	2,083,444
Cash flow interest rate risk
Financial assets		543,753		567,017		1,027,268
Financial liabilities		2,539,500		3,109,674		4,609,859

If interest rates had been 0.25% higher/lower all other variables were held constant, the Group’s pre-tax profit for the six months ended June 30, 2021 and 2020 would have been lower/higher by NT$2,495 thousand and NT$4,478 thousand, respectively.

c) Other price risk

The Group was exposed to equity price risk through their investments in domestic listed shares.

The equity price of the group was evaluated by the closing price of the equity securities on a monthly basis.

Sensitivity analysis

If equity price of fair value through other comprehensive income financial assets had been lower by one dollar, the pre-tax-other comprehensive income, for the six months ended June 30, 2021

35 -

and 2020 would have both been lower by NT$34,113 thousand, respectively.

2) Credit risk

Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in financial loss to the Group. As at the balance sheet date, the Group’s maximum exposure to credit risk is the carrying amount of the financial assets on the consolidated balance sheets.

The Group made transactions only with the parties with good credit. The goods were delivered after the cash or L/C was received, and the Group did not provide financial guarantee to any company. Accounts receivable were due to time differences of L/C negotiation and there was no bad debt in the recent years; therefore, the credit risk is very low.

3) Liquidity risk

The Group manages liquidity risk by monitoring and maintaining a level of cash and cash equivalents deemed adequate to finance the Group’s operations and mitigate the effects of fluctuations in cash flows. The Group relies on bank borrowings as a significant source of liquidity. The management monitors the utilization of bank borrowings and ensures compliance with loan covenants. As of June 30, 2021, the unutilized credit facility of the Group was NT$47.2 billion; therefore, there is no liquidity risk or incapacity of financing capital to meet contractual obligations.

The table below summarizes the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments:

June 30, 2021 Short-term borrowings Short-term bills payable Accounts payable (including related parties) Other payables Refund liabilities Lease liabilities Bonds payables Long-term bank borrowings Long-term bills payable Guarantee deposits received December 31, 2020 Short-term borrowings Short-term bills payable Accounts payable (including related parties) Other payables Refund liabilities Lease liabilities Bonds payables Long-term bank borrowings Long-term bills payable Guarantee deposits received	Less Than 1 Year $ 1,397,663 100,000 1,269,904 1,349,729 299,046 16,344 22,100 10,980 - - $ 4,465,766 $ 406,794 3,600,000 340,724 580,264 153,756 16,086 22,100 16,500 - - $ 5,136,224	1-5 Years $ - - - - - 41,270 3,072,800 1,420,748 1,140,000 - $ 5,674,818 $ - - - - - 45,564 3,088,400 2,034,430 1,110,000 - $ 6,278,394	Over 5 Years $ - - - - - 17,505 - - - 35,000 $ 52,505 $ - - - - - 20,646 - - - 35,000 $ 55,646	Total $ 1,397,663 100,000 1,269,904 1,349,729 299,046 75,119 3,094,900 1,431,728 1,140,000 35,000
				$ 10,193,089
				$ 406,794 3,600,000 340,724 580,264 153,756 82,296 3,110,500 2,050,930 1,110,000 35,000
				$ 11,470,264

(Continued)

36 -

June 30, 2020 Short-term borrowings Short-term bills payable Accounts payable (including related parties) Other payables Refund liabilities Lease liabilities Bonds payables Long-term bank borrowings Long-term bills payable Guarantee deposits received	Less Than 1 Year $ 5,440,148 2,550,000 120,841 471,234 161,118 16,086 15,600 10,208 - - $ 8,785,235	1-5 Years $ - - - - - 50,439 2,062,400 2,926,630 1,710,000 - $ 6,749,469	Over 5 Years $ - - - - - 23,788 - - - 35,000 $ 58,788	Total $ 5,440,148 2,550,000 120,841 471,234 161,118 90,313 2,078,000 2,936,838 1,710,000 35,000 $ 15,593,492 (Concluded)

29. TRANSACTIONS WITH RELATED PARTIES

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 other related parties are disclosed below.

a. The name of the company and its relationship with the Group

Company Relationship China Steel Corporation Parent entity Dragon Steel Corporation (DSC) Fellow subsidiaries CHC Resources Corporation (CHC) Fellow subsidiaries Info Champ Systems Corporation (ICSC) Fellow subsidiaries CSC Steel SDN. BHD. (CSSB) Fellow subsidiaries Himag Magnetic Corporation (HMC) Fellow subsidiaries China Steel Machinery Corporation Fellow subsidiaries China Steel Global Trading Corporation (CSGT) Fellow subsidiaries China Ecotek Corporation Fellow subsidiaries China Steel Security Corporation Fellow subsidiaries Steel Castle Technology Corporation Fellow subsidiaries China Steel Express Corporation Fellow subsidiaries China Steel Structure Co., Ltd Fellow subsidiaries Universal Exchange Inc. Fellow subsidiaries China Steel Management Consulting Corp. Fellow subsidiaries China Steel Chemical Corporation Fellow subsidiaries Yu Cheng Lime Corporation Fellow subsidiaries Wabo Global Trading Corporation Fellow subsidiaries CSC Solar Corporation Fellow subsidiaries Kaohsiung Rapid Transit Corporation Fellow subsidiaries Sing Da Marine Structure Fellow subsidiaries CSGT Japan Co., Ltd. Fellow subsidiaries China Steel Precision Metals Kunshan Co., Ltd. Fellow subsidiaries CSE Transport Corporation Fellow subsidiaries Transglory Investment Corporation (TIC) Associates Pacific Harbour Stevedoring Corporation Other related parties as supervisors of the Corporation

37 -

b. Sale of goods

Related Parties Account Items Types Sales Parent entity Fellow subsidiaries related to others CSSB Others Service Revenue Parent entity Fellow subsidiaries related to others		For the Three Months Ended June 30 2021 2020 $ 794 $ 3,055 407,808 99,942 18,621 9,029 426,429 108,971 $ 427,223 $ 112,026 $ 129,570 $ 82,067 8 11 $ 129,578 $ 82,078		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 794 407,808 18,621 426,429 $ 427,223 $ 129,570 8 $ 129,578		2021 $ 1,368 1,011,576 37,173 1,048,749 $ 1,050,117 $ 281,301 8 $ 281,309	2020 $ 7,524 535,254 13,859 549,113 $ 556,637 $ 196,503 11 $ 196,514

The parent entity and some fellow subsidiaries related to others paid by telegraphic transfers (T/T) within 7 days from product shipment, T/T within 60 days from product shipment, monthly billing by T/T after acceptance sale of, steel pipe products collected at the beginning of next month; these payment terms differed from those for third parties, from whom payments were negotiated to be on Tuesday and Friday. The price of iron oxide that the Corporation sells to fellow subsidiaries related to others does not have comparable price because the Corporation does not sell iron oxide to third parties and the collection term for selling iron oxide is negotiated to be on Tuesday and Friday.

The abovementioned service revenue is from the agreements that the Corporation entered into with parent entity in which the Corporation has to do certain processing work and charged based on the formula stated in the agreements. The Corporation bills the parent entity within one month after approval of delivery.

The Corporation entered into an agreement with fellow subsidiaries related to others under which the Corporation sells waste acid and the price is charged based on the formula stated in the agreement. The Corporation bills the fellow subsidiaries related to others within a month after acceptance by T/T based on the monthly amount of processing.

Related Parties/Name Account Items Types Other operating revenue Fellow subsidiaries related to others DSC HMC		For the Three Months Ended June 30 2021 2020 $ 16,328 $ 9,996 3,116 2,384 $ 19,444 $ 12,380		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 16,328 3,116 $ 19,444		2021 $ 29,968 6,561 $ 36,529	2020 $ 21,347 5,477 $ 26,824

There is no significant profit or loss from the sale of the materials of the Company to fellow subsidiaries.

38 -
c. Purchase of goods

For the Three Months Ended June 30 2021 2020 $ 1,014,453 $ 2,571,298 4,645,331 2,408,507 1,458,244 76,801 6,103,575 2,485,308 $ 7,118,028 $ 5,056,606	For the Six Months Ended June 30	For the Six Months Ended June 30
2021 $ 1,014,453 4,645,331 1,458,244 6,103,575 $ 7,118,028	2021 $ 3,518,759 7,408,068 1,864,721 9,272,789 $ 12,791,548	2020 $ 9,573,865
		3,954,559 212,686
		4,167,245
		$ 13,741,110

Purchases from related parties, mainly slabs and hot rolling coil. Purchase from related parties were made under normal term for the six months ended June 30, 2021; There were not comparable for the six months ended June 30, 2020 because there was no transaction with non-related parties and were made under normal terms for the six months ended June 30, 2020.

d. Accounts receivable from related parties

Account Items Related Parties Types/Name Accounts receivable from Parent entity related parties Fellow subsidiaries related to others CSSB Others Other receivables from Parent entity related parties Fellow subsidiaries related to others CHC Others Associates TIC	June 30, 2021 December 31, 2020 $ 33,120 $ 52,905 - 53,331 11,154 11,002 11,154 64,333 $ 44,274 $ 117,238 $ 13,460 $ 1,035 41,941 $ 25,389 - 248 41,941 25,637 44,271 - $ 99,672 $ 26,672	June 30, 2020 $ 15,390 - 6,253 6,253 $ 21,643 $ 506,260 $ 22,113 50 22,163 - $ 528,423

No guarantee had been received for accounts receivable and other receivable from related parties. No expense had been recognized for the six months ended June 30, 2021 and 2020 for allowance for impairment of accounts receivable in respect of the amounts owed by related parties.

e. Accounts payable to related parties (excluding loans from related parties)

Account Items Related Parties Types Accounts payable Parent entity	June 30, 2021 December 31, 2020 June 30, 2020 $ 611,457 $ 267,429 $ 87,652 (Continued)

39 -

Account Items Related Parties Types Accounts payable Fellow subsidiaries related to others CSGT Others Others Other payable Parent entity Fellow subsidiaries related to others Others	June 30, 2021 December 31, 2020 $ 173,148 $ 41,210 14,781 606 187,929 41,816 9,936 3,979 $ 809,322 $ 313,224 $ 216,799 $ 7,459 6,601 9,187 1,206 3,023 $ 224,606 $ 19,669	June 30, 2020 $ 4,742 655
		5,397
		5,483
		$ 98,532
		$ 8,024 10,896 549
		$ 19,469

(Concluded)

The outstanding accounts payable to related parties were unsecured.

f. Loans from related parties

Related Parties Types Parent entity	June 30, 2021 $ -	December 31, 2020 $ -	June 30, 2020 $ 2,400,000

The Corporation borrowed money from the parent entity because of the need for short-term fund. The interest rate of the loan was based on average daily short-term interest the parent entity financed for the same currency from financial institutions in the last 30 days and adjusted monthly.

As of June 30, 2020, the loans from the parent entity were unsecured loans with interest expense of NT$3,735 thousand and NT$7,969 thousand for the three months ended June 30, 2020 and for the six months ended June 30, 2020, respectively.

g. Other transactions with related parties

1) Authorization fees

In May 2003, CSC, Sumitomo Metal Industries, Ltd. (SMI, renamed to Nippon Steel Corporation in April, 2019) and Sumitomo Corporation (SC) entered into a joint venture agreement and established a holding company named East Asia United Steel Corporation (EAUS) in July 2003. CSC will have a stable supply of good quality slab through this joint venture. CSC then signed a contract with the Corporation, transferring to the Corporation the right to buy slab from EAUS. The Corporation should pay authorization fees to CSC under the contract. These fees (included in the purchase cost of materials) were NT$18,096 thousand, NT$11,013 thousand, NT$36,039 thousand and NT$49,400 thousand for the three months ended June 30, 2021 and 2020 and for the six months ended June 30, 2021 and 2020, respectively. As of June 30, 2021, December 31, 2020 and June 30, 2020, authorization fees payable (included in payables to related parties) were NT$15,341 thousand, NT$15,697 thousand and NT$11,655 thousand, respectively. The calculation of slab purchase prices was based on the formula stated in the agreement.

2) Leases

a) The Corporation entered into a contract with fellow subsidiaries related to others on the lease of the Corporation’s part of the land, roof and warehouse. The rental revenue for the three months ended June 30, 2021 and 2020 and for the six months ended June 30, 2021 and 2020 were NT$1,032 thousand, NT$1,035 thousand, NT$2,011 thousand and NT$2,019 thousand, respectively.
40 -
b) The Corporation entered into a contract with parent entity on the lease of the Corporation’s part of the land. The rental revenue for the three months ended June 30, 2021 and 2020 and for the six months ended June 30, 2021 and 2020 were NT$1,327 thousand, NT$1,327 thousand, NT$2,655 thousand and NT$2,655 thousand, respectively.
3) Construction in progress and other expenditures

Other expenditures include import and export transportation fees, export agency fees, rent expenses, remuneration and transportation allowances of directors and supervisors, etc., were as follows:

a) Other expenditures Parent entity Others Fellow subsidiaries related to others b) Capital expenditure Parent entity Fellow subsidiaries related to others ICSC Others		For the Three Months Ended June 30 2021 2020 $ 50,683 $ 20,207 34,002 34,944 33,644 31,418 $ 118,329 $ 86,569 $ - $ - $ 14,013 $ 95,085 - 379 14,013 95,464 $ 14,013 $ 95,464		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 50,683 34,002 33,644 $ 118,329 $ - $ 14,013 - 14,013 $ 14,013		2021 $ 101,703 63,651 47,385 $ 212,739 $ - $ 34,165 - 34,165 $ 34,165	2020 $ 46,119 74,632 55,137 $ 175,888 $ 7,600 $ 101,825 379 102,204 $ 109,804

4) Income from supplies and scrap (included in deductions of cost of goods sold)

For the Three Months Ended June 30 2021 2020 Fellow subsidiaries related to others CHC $ 117,898 $ 57,074 Others - 3,148 $ 117,898 $ 60,222 Compensation of key management personnel For the Three Months Ended June 30 2021 2020 Short-term employee benefits $ 31,752 $ 6,682		For the Six Months Ended June 30
		2021 2020 $ 220,086 $ 134,306 3,018 6,766 $ 223,104 $ 141,072 For the Six Months Ended June 30
		2021 2020 $ 57,866 $ 11,655 (Continued)

h. Compensation of key management personnel
41 -

Post-employment benefits		For the Three Months Ended June 30	For the Three Months Ended June 30		For the Six Months Ended June 30	For the Six Months Ended June 30
		2021 $ 352 $ 32,104	2020 $ 545 $ 7,227		2021 $ 705 $ 58,571	2020 $ 1,090 $ 12,745

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30. ASSETS PLEDGED AS COLLATERAL OR SECURITY

The Group’s assets mortgaged or pledged as collateral for bank overdrafts was as follows (listed based on their carrying amounts):

Time deposits (included in other financial assets - current)	June 30, 2021 December 31, 2020 $ 300,000 $ 300,000	June 30, 2020 $ 300,000

31. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

In addition to those disclosed in other notes, significant commitments and contingencies of the Group as of June 30, 2021 were as follows:

a. Unused letters of credit for purchases of raw materials and machinery and equipment amounted to about NT$3,490,860 thousand
b. The Group had signed agreements to buy equipment for NT$333,786 thousand, of which NT$68,553 thousand had been paid (included in construction-in-progress and prepayments for equipment).
c. The Group provided letters of credits for NT$144,129 thousand guaranteed by financial institutions for several constructions, purchase agreements and import and export goods. Guarantee notes for NT$32,158,175 thousand were provided to bank for credit line.

32. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

The following information was aggregated by the foreign currencies other than functional currencies of the Group and the exchange rates between foreign currencies and respective functional currencies were disclosed. The significant assets and liabilities denominated in foreign currencies were as follows:

				Carrying	Carrying
		Foreign			Amount
	Currencies			(In	Thousands
		(In		of New Taiwan
	Thousands)		Exchange Rate		Dollars)
June 30, 2021
Monetary financial assets
USD	$	2,679	27.860 (USD:NTD)	$	74,647
					(Continued)

42 -

				Carrying	Carrying
		Foreign			Amount
	Currencies			(In	Thousands
		(In		of New Taiwan
	Thousands)		Exchange Rate		Dollars)
June 30, 2021
Monetary financial liabilities
USD	$	32,827	27.860 (USD:NTD)	$	914,549
December 31, 2020
Monetary financial assets
USD		19,476	28.480 (USD:NTD)		554,666
Monetary financial liabilities
USD		901	28.480 (USD:NTD)		25,659
June 30, 2020
Monetary financial assets
USD		54,360	29.63 (USD:NTD)		1,610,687
Monetary financial liabilities
USD		1,388	29.63 (USD:NTD)		41,132
					(Concluded)

For the three months ended June 30, 2021 and 2020 and for the six months ended June 30, 2021 and 2020, realized and unrealized net foreign exchange gains were NT$4,296 thousand, NT$951 thousand, NT$13,339 thousand and NT$6,043 thousand, respectively. It is impractical to disclose net foreign exchange gains and losses by each significant foreign currency due to the variety of the foreign currency transactions and functional currencies of each entity.

33. SEPARATELY DISCLOSED ITEMS

a. For the six months ended June 30, 2021, information about significant transactions and b. investees:
1) Financing provided to others (None)
2) Endorsements/guarantees provided (None)
3) Marketable securities held (excluding investments in subsidiaries and associates) (Table 1)
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 (None)
43 -
7) Total purchases from or sales to related parties amounting to at least NT$100 million or 20% of the paid-in capital (Table 2)
8) Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital (None)
9) Trading in derivative instruments (None)
10) Intercompany relationships and significant intercompany transactions (None)
11) Information on investees (Table 3)
c. Information on investments in mainland China (None)
d. Information of major shareholders (Table 4)

34. SEGMENT INFORMATION

Information reported to the chief operating decision maker for the purposes of resource allocation and assessment of segment performance focuses on the types of goods or services delivered or provided. Reportable segments of the Group were as follows:

The Corporation - manufacture, process and sell steel products.
Other corporations - Hung Kao Investment Corporation engaged in general investment.

Segment revenues and operating results

The following is an analysis of the Group revenues and results of operations by reportable segment.

For the six months ended June 30, 2021 Revenues from external customers Segment profit Interest income Other income Other income and expenses Finance costs Share of the profit of associates Profit before income tax for the period Income tax expense Net profit for the period	The Corporation $ 24,223,457 $ 3,598,371 265 55,248 351,766 ( 22,054) 1,719 3,985,315 ( 4,471) $ 3,980,844	Others Adjustment and Elimination $ 4,428 $ - $ 3,752 $ 60 10 - - ( 60) - - - - - ( 3,010) 3,762 ( 3,010) ( 752) - $ 3,010 ($ 3,010)	Total $ 24,227,885 $ 3,602,183 275 55,188 351,766 ( 22,054) ( 1,291) 3,986,067 ( 5,223) $ 3,980,844 (Continued)

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The
Corporation
Others
For the six months ended
June 30, 2021
Identifiable assets
$ 27,028,378 $ 47,754
Investments accounted for
using equity method

4,520,628

-

Total assets
$ 31,549,628
$ 47,754

Total liabilities
$ 10,602,786
$ 1,506

For the six months ended
June 30, 2020
Revenues from external
customers
$ 17,949,305
$ -

Segment loss
($ 465,314) ($ 680)
Interest income
469
9
Other income
63,594
-
Other income and expenses
(
34,422)
-
Finance costs
(
49,400)
-
Share of the profit of associates (
3,830)

-

Net loss for the period
($ 488,903)
($ 671)

Identifiable assets
$ 27,432,602 $ 25,090
Investments accounted for
using equity method

2,191,317

-

Total assets
$ 29,623,919
$ 25,090

Total liabilities
$ 16,009,730
$ 1,800

Adjustment
and
Elimination
Total
$ - $ 27,076,132
(
46,248)

4,474,380
($ 46,248)
$ 31,550,512
$ -
$ 10,604,292
$ -
$ 17,949,305
$ 60 ($ 465,934)
-
478
(
60)
63,534
- (
34,422)
- (
49,400)
671
(
3,159)
$ 671
($ 488,903)
$ - $ 27,457,692
(
23,290)

2,168,027
($ 23,290)
$ 29,625,719
$ -
$ 16,011,530
(Concluded)

Segment profit represented the profit before tax earned by each segment without allocation of central administration costs and directors’ salaries, rental revenue, interest income, gain or loss on disposal of property, plant and equipment, exchange gain or loss, finance costs and income tax expense. This was the measure reported to the chief operating decision maker for the purpose of resource allocation and assessment of segment performance.

45 -

TABLE 1

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

MARKETABLE SECURITIES HELD JUNE 30, 2021

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

Held Company Name	Type and Name of Marketable Securities	Relationship with The Company	Financial Statement Account		JUNE 30,	JUNE 30,	2021		Note
				Shares/Units	Carrying Value		Percentage of Ownership (%)	Fair Value
Chung Hung Steel Corporation Hung Kao Investment Corporation	Common Stock Yieh United Steel Corp. Shouh Hwang Enterprise Co., Ltd. Common Stock China Steel Corporation Common Stock Taiwan Ves-Power Co., Ltd. Riselink Venture Capital Corp. Pacific Harbour Stevedoring Corp. Common Stock China Steel Corporation	Parent company The company as its supervisor The ultimate parent of the Company	Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - noncurrent Financial assets at fair value through other comprehensive income - noncurrent Financial assets at fair value through other comprehensive income - noncurrent Financial assets at fair value through other comprehensive income - noncurrent	15,439,800 730,000 33,109,239 958,333 3,948 250,000 1,003,980		$ 311,266 - $ 311,266 $ 1,311,126 $ 42,914 371 6,017 $ 49,302 $ 39,758	1 15 - 2 3 5 -	$ 311,266 - $ 311,266 $ 1,311,126 $ 42,914 371 6,017 $ 49,302 $ 39,758	Note1 Note2 2021.5.31 net value 2021.5.31 net value 2021.4.30 net value

Note 1: The fair value of emerging stock was based on the closing price adjusted for liquidity risk premium on June 30, 2021.

Note 2: The impairment loss has been recognized that resulted in zero book value.

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TABLE 2

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL FOR THE PERIOD ENDED JUNE 30, 2021

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

Buyer	Related Party	Relationship	Relationship	Relationship	Relationship	Relationship	Abnormal Transaction	Abnormal Transaction	Notes/Accounts Receivable (Payable)	Notes/Accounts Receivable (Payable)	Note
			Purchase/Sale	Amount	% of Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% of Total
Chung Hung Steel Corporation	Dragon Steel Corporation China Steel Corporation China Steel Global Trading Corporation CSC Steel Sdn. Bhd. China Steel Corporation	Fellow subsidiary Parent company Fellow subsidiary Fellow subsidiary Parent company	Purchase of goods Purchase of goods Purchase of goods Revenue from sale of goods Service revenue	$7,408,068 3,518,759 1,826,190 (1,011,576 ) (276,872 )	38 18 9 (4 ) (1 )	Letter of credit at sight Letter of credit at sight/Payment after final acceptance Letter of credit at sight/Payment after final acceptance T/T within 7 business days after lading date(not included) T/T as the end of the month of after final acceptance	$- - - - -	NO MATERIAL DIFFERENCE NO MATERIAL DIFFERENCE NO MATERIAL DIFFERENCE NO MATERIAL DIFFERENCE NO THIRD-PARTY COULD BE COMPARED	$- (611,457 ) (173,148 ) - 33,120	- (48 ) (14 ) - 3

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TABLE 3

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

INFORMATION ON INVESTEES FOR THE PERIOD ENDED JUNE 30, 2021

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

Investor Company	Investee Company	Location	Main Businesses and Products	Original Investment Amount	Original Investment Amount	As	of June 30, 2021	of June 30, 2021	Net Income (Loss) of the Investee	Share of Profit (Loss)	Note
						Number of Shares	%	Carrying Amount
				June 30, 2021	December 31, 2020
Chung Hung Steel Corporation Chung Hung Steel Corporation Chung Hung Steel Corporation	Hung Kao Investment Corporation Transglory Investment Corporation Pro-Ascentek Investment Corporation	Republic of China Republic of China Republic of China	General investment General investment General investment	$ 26,000 2,001,152 200,000	$ 26,000 2,001,152 -	2,600,000 306,824,279 20,000,000	100.00 40.91 16.67	$ 46,248 4,270,511 203,869	$ 3,010 ( 5,754 ) 5,487	$ 3,010 ( 2,205 ) 914	Subsidiaries (Note) Associates Associates

Note: Amount was eliminated in the consolidated financial statements.

48 -

TABLE 4

CHUNG HUNG STEEL CORPORATION

INFORMATION OF MAJOR SHAREHOLDERS JUNE 30, 2021

Name of The Shareholder	Shares	Shares
	Number of Shares Owned	Percentage of Ownership(%)
China Steel Corporation	582,673,153	40.58

Note 1: Major shareholders in the Table above are shareholders owning 5% or more of the Corporation’s common and preferred stocks (only ones that have completed dematerialized registration and delivery, and include treasury stocks) based on calculations performed by the Taiwan Depository & Clearing Corporation using data as of the last business date at the end of each quarter. The amount of capital in the financial statements may differ from the Corporation’s actual number of stocks that have completed dematerialized registration and delivery due to different calculation bases.

Note 2: Where the stocks are entrusted by shareholders, information is disclosed by the individual account of settlor who has segregated trust accounts opened by trustees. As for shareholders filing shareholdings of insiders with 10% or more of the Corporation’s stocks pursuant to the securities and exchange laws and regulations, the number of stocks owned shall be ones owned by the persons plus ones entrusted where the shareholders have the power to decide how to utilize the trust property. Please access the Market Observation Post System website for information on insiders’ shareholding filings.

49 -

AI assistant

CHUNG HUNG — Interim / Quarterly Report 2021

51945_rns_2021-12-30_8b2e7739-61eb-490d-ab48-743af46638f1.pdf

Chung Hung Steel Corporation and Subsidiaries

INDEPENDENT AUDITORS’ REVIEW REPORT

Introduction

Scope of Review

Conclusion

Notice to Readers

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In Thousands of New Taiwan Dollars)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings (Loss) Per Share) (Reviewed, Not Audited)

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In Thousands of New Taiwan Dollars, Except Earnings (Loss) Per Share) (Reviewed, Not Audited)

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

CHUNG HUNG STEEL CORPORATION AND SUBSIDIARIES

1. GENERAL INFORMATION

2. APPROVAL OF FINANCIAL STATEMENTS

3. APPLICATION OF NEW AND AMENDED STANDARDS AND INTERPRETATIONS

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICY

c. Other significant accounting policies

1) Retirement benefits

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

6. CASH

7. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS - CURRENT

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

9. ACCOUNTS RECEIVABLE AND OTHER RECEIVABLES

June 30, 2021

b. Other receivables

10. INVENTORIES

11. PREPAYMENTS

13. INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD

TIC

14. PROPERTY, PLANT AND EQUIPMENT

15. LEASE ARRANGEMENTS

b. Lease liabilities

c. Material lease activities and terms

d. Other lease information

16. INVESTMENT PROPERTIES

17. BORROWINGS

b. Short-term bills payable

c. Long-term borrowings

18. BONDS PAYABLE

19. ACCOUNTS PAYABLE

20. OTHER PAYABLES

21. RETIREMENT BENEFIT PLANS

22. EQUITY

a. Ordinary shares

23. OPERATING REVENUES

b. Disaggregation of revenue

24. PROFIT (LOSS) BEFORE INCOME TAX

b. Other gains and losses

c. Finance costs

d. Depreciation

g. Employees’ compensation and remuneration of directors

25. INCOME TAX

26. EARNINGS (LOSS) PER SHARE

Net profit (loss) for the period

27. CAPITAL MANAGEMENT

28. FINANCIAL INSTRUMENTS

1) Fair value hierarchy

1) Market risk

a) Foreign currency risk

Sensitivity analysis

b) Interest rate risk

c) Other price risk

Sensitivity analysis

2) Credit risk

29. TRANSACTIONS WITH RELATED PARTIES

b. Sale of goods

g. Other transactions with related parties

2) Leases

30. ASSETS PLEDGED AS COLLATERAL OR SECURITY

31. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS

CHUNG HUNG Interim / Quarterly Report 2021