cpc — Interim / Quarterly Report 2021

Dec 20, 2021

CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS’ REVIEW REPORT MARCH 31, 2021 AND 2020

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

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INDEPENDENT AUDITORS’ REVIEW REPORT TRANSLATED FROM CHINESE

To the Board of Directors and Stockholders of CHIEFTEK PRECISION CO., LTD.

Introduction

We have reviewed the accompanying consolidated balance sheets of CHIEFTEK PRECISION CO., LTD. and subsidiaries (the “Group”) as of March 31, 2021 and 2020, and the related consolidated statements of comprehensive income, of changes in equity and of cash flows for the three-month periods then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies. Management is responsible for the preparation and fair presentation of these 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” as endorsed by the Financial Supervisory Commission. Our responsibility is to express a conclusion on these consolidated financial statements based on our reviews.

Scope of review

Except as explained in the following paragraph, we conducted our reviews in accordance with the Statement of Auditing Standards No. 65, “Review of Financial Information Performed by the Independent Auditor of the Entity” in the Republic of China. 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.

Basis for qualified conclusion

As explained in Note 4(3), the financial statements and related information disclosed in Note 13 of insignificant consolidated subsidiaries were not reviewed by independent auditors. Those statements reflect total assets of NT$311,237 thousand and NT$285,219 thousand, constituting 9% and 8% of the consolidated total assets, and total liabilities of NT$86,347 thousand and NT$86,539 thousand, both constituting 6% of the consolidated total liabilities as of March 31, 2021 and 2020, respectively, and total comprehensive income of NT$10,382 thousand and NT$668 thousand, constituting 16% and 2% of the consolidated total comprehensive income for the three-month periods then ended, respectively.

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Qualified conclusion

Except for the adjustments to the consolidated financial statements, if any, as might have been determined to be necessary had the financial statements of certain consolidated subsidiaries been reviewed by independent auditors as described in the Basis for qualified conclusion section above, based on our reviews, nothing has come to our attention that causes us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of the Group as of March 31, 2021 and 2020, and of its consolidated financial performance and its consolidated cash flows for the three-month periods then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “Interim Financial Reporting” as endorsed by the Financial Supervisory Commission.

Lin, Yung-Chih

Independent Auditors

Tien, Chung-Yu

PricewaterhouseCoopers, Taiwan

Republic of China

May 5, 2021

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

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

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CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS MARCH 31, 2021, DECEMBER 31, 2020 AND MARCH 31, 2020

(Expressed in thousands of New Taiwan dollars)

(The consolidated balance sheets as of March 31, 2021 and 2020 are reviewed, not audited)

Assets	Notes	March 31, 2021 AMOUNT % $ 660,529 19 7,392 - 31,915 1 360,413 10 1,971 - 20,702 1 525,504 15 46,460 1 1,654,886 47 1,562,194 44 128,045 4 99,337 3 21,975 1 47,764 1 10,403 - 3,683 - 1,873,401 53 $ 3,528,287 100	December 31, 2020 AMOUNT % $ 654,597 19 7,360 - 27,767 1 344,675 10 9,515 - 20,398 - 556,943 16 36,049 1 1,657,304 47 1,532,120 44 129,601 4 101,595 3 25,160 1 48,474 1 9,775 - 5,312 - 1,852,037 53 $ 3,509,341 100	March 31, 2020	March 31, 2020
		AMOUNT $ 660,529 7,392 31,915 360,413 1,971 20,702 525,504 46,460 1,654,886 1,562,194 128,045 99,337 21,975 47,764 10,403 3,683 1,873,401 $ 3,528,287	AMOUNT $ 654,597 7,360 27,767 344,675 9,515 20,398 556,943 36,049 1,657,304 1,532,120 129,601 101,595 25,160 48,474 9,775 5,312 1,852,037 $ 3,509,341	AMOUNT $ 647,003 7,742 25,274 306,493 2,915 15,288 652,349 40,658 1,697,722 1,414,104 134,269 118,267 22,070 46,289 8,288 2,805 1,746,092 $ 3,443,814	%
Current assets 1100 Cash and cash equivalents 1136 Financial assets at amortized cost - current 1150 Notes receivable, net 1170 Accounts receivable, net 1200 Other receivables 1220 Current income tax assets 130X Inventories 1410 Prepayments 11XX Total current assets Non-current assets 1600 Property, plant and equipment 1755 Right-of-use assets 1780 Intangible assets 1840 Deferred income tax assets 1915 Prepayments for equipment 1920 Guarantee deposits paid 1990 Other non-current assets 15XX Total non-current assets 1XXX Total assets	6(1) 6(2) 6(3) 6(3) and 12 6(23) 5 and 6(4) 6(5) and 8 6(6) 6(7) 6(23) 6(5)				19 - 1 9 - - 19 1
					49
					41 4 4 1 1 - -
					51
					100

(Continued)

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CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS MARCH 31, 2021, DECEMBER 31, 2020 AND MARCH 31, 2020

(Expressed in thousands of New Taiwan dollars)

(The consolidated balance sheets as of March 31, 2021 and 2020 are reviewed, not audited)

					March 31, 2021				December 31, 2020	December 31, 2020			March 31, 2020
	Liabilities and Equity	Notes			AMOUNT	%			AMOUNT	%			AMOUNT	%
	Liabilities
	Current liabilities
2100	Short-term borrowings	6(8)(26)		$	294,000		8	$	379,012	11		$	524,578	15
2110	Short-term notes and bills payable	6(9)(26)			-		-		-		-		30,000		1
2130	Current contract liabilities	6(16)			6,695		-		4,807		-		8,471		-
2150	Notes payable				96,698		3		77,992		2		79,377		2
2170	Accounts payable				48,620		1		49,211		2		47,577		2
2200	Other payables	6(10)(15)			260,721		8		110,835		3		179,201		5
2230	Current income tax liabilities	6(23)			9,052		-		3,848		-		18,652		1
2280	Current lease liabilities	6(6)(20)(26)			5,237		-		5,214		-		5,144		-
2320	Long-term liabilities, current	6(11)(26), 8
	portion	and 9			100,929		3		94,658		3		75,696		2
21XX	Total current liabilities				821,952	23			725,577	21			968,696	28
	Non-current liabilities
2540	Long-term borrowings	6(11)(26), 8
		and 9			492,885	14			517,984	15			287,669		9
2570	Deferred income tax liabilities	6(23)			25,539		1		18,973		-		6,865		-
2580	Non-current lease liabilities	6(6)(20)(26)			125,268		4		126,586		4		130,505		4
2640	Net defined benefit liabilities	6(12)			7,089		-		7,163		-		6,589		-
25XX	Total non-current liabilities				650,781	19			670,706	19			431,628	13
2XXX	Total liabilities				1,472,733	42			1,396,283	40			1,400,324	41
	Equity
	Share capital	6(13)
3110	Common stock				811,876	23			811,876	23			811,876	24
	Capital reserves	6(14)
3200	Capital surplus				440,667	12			440,667	12			440,667	13
	Retained earnings	6(15)
3310	Legal reserve				162,016		5		162,016		5		144,552		4
3320	Special reserve				29,394		1		29,394		1		17,047		-
3350	Unappropriated retained earnings				677,343	19			731,978	21			683,961	20
3400	Other equity interest		(		39,192 ) (		1) (		36,323 ) (		1) (		31,073) (		1)
3500	Treasury stocks	6(13)	(		26,550 ) (		1) (		26,550 ) (		1) (		23,540) (		1)
3XXX	Total equity				2,055,554	58			2,113,058	60			2,043,490	59
	Significant Contingent Liabilities and	6(6) and 9
	Unrecognized Contract Commitments
3X2X	Total liabilities and equity			$	3,528,287	100		$	3,509,341	100		$	3,443,814	100

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

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CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2021 AND 2020 (Expressed in thousands of New Taiwan dollars, except as otherwise indicated) (REVIEWED, NOT AUDITED)

Items

Three months ended March 31 2021 2020 Notes AMOUNT % AMOUNT % 6(16) $ 418,654 100 $ 290,490 100 6(4)(12)(21)(22)( 242,384) ( 58) ( 160,021) ( 55) 176,270 42 130,469 45 6(7)(12)(21)(22) and 7 ( 22,843) ( 5) ( 24,192) ( 8) ( 41,322) ( 10) ( 38,973) ( 14) ( 19,447) ( 5) ( 15,115) ( 5) 12 2,458 1 ( 1,021) ( 1) ( 81,154) ( 19) ( 79,301) ( 28) 95,116 23 51,168 17 6(2)(17) 240 - 544 - 6(18) 721 - 1,748 1 6(19) and 12 ( 4,567) ( 1) 4,535 2 6(6)(20) ( 3,699) ( 1) ( 4,886) ( 2) ( 7,305) ( 2) 1,941 1 87,811 21 53,109 18 6(23) ( 21,332) ( 5) ( 9,185) ( 3) $ 66,479 16 $ 43,924 15 ($ 2,869) ( 1) ($ 1,679) - ($ 2,869) ( 1) ($ 1,679) - $ 63,610 15 $ 42,245 15 6(24) $ 0.82 $ 0.54 $ 0.82 $ 0.54

4000 Sales revenue 5000 Operating costs 5900 Net operating margin Operating expenses 6100 Selling expenses 6200 General and administrative expenses 6300 Research and development expenses 6450 Expected credit impairment gain (loss) 6000 Total operating expenses 6900 Operating profit Non-operating income and expenses 7100 Interest income 7010 Other income 7020 Other gains and losses 7050 Finance costs 7000 Total non-operating income and expenses 7900 Profit before income tax 7950 Income tax expense 8200 Profit for the period Other comprehensive income (loss) (Net) Components of other comprehensive income (loss) that will be reclassified to profit or loss 8361 Financial statements translation differences of foreign operations 8300 Total other comprehensive loss for the period 8500 Total comprehensive income for the period Earnings per share (in dollars) 9750 Basic 9850 Diluted

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

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CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2021 AND 2020 (Expressed in thousands of New Taiwan dollars) (REVIEWED, NOT AUDITED)

For the three-month period ended March 31, 2020 Balance at January 1, 2020 Profit for the period Other comprehensive loss for the period Total comprehensive income (loss) for the period Purchase of treasury stocks Balance at March 31, 2020 For the three-month period ended March 31, 2021 Balance at January 1, 2021 Profit for the period Other comprehensive loss for the period Total comprehensive income (loss) for the year Appropriation of 2020 earnings Cash dividends Balance at March 31, 2021	Notes		Share capital - common stock		Capital reserve				Retained Earnings	Retained Earnings		Other Equity Interest		Treasury stocks		Total equity
							Legal reserve		Special reserve		Unappropriated retained earnings	Financial statements translation differences of foreign operations
	6(15)		$ 811,876 - - - - $ 811,876 $ 811,876 - - - - $ 811,876		$ 440,667 - - - - $ 440,667 $ 440,667 - - - - $ 440,667		$ 144,552 - - - - $ 144,552 $ 162,016 - - - - $ 162,016		$ 17,047 - - - - $ 17,047 $ 29,394 - - - - $ 29,394	$ 640,037 43,924 - 43,924 - $ 683,961 $ 731,978 66,479 - 66,479 ( 121,114) $ 677,343		($ 29,394 ) - ( 1,679 ) ( 1,679 ) - ($ 31,073 ) ($ 36,323 ) - ( 2,869 ) ( 2,869 ) - ($ 39,192 )	$ - - - - ( 23,540) ($ 23,540) ($ 26,550) - - - - ($ 26,550)		$ 2,024,785 43,924 ( 1,679 ) 42,245 ( 23,540 ) $ 2,043,490 $ 2,113,058 66,479 ( 2,869 ) 63,610 ( 121,114 ) $ 2,055,554

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

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CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2021 AND 2020 (Expressed in thousands of New Taiwan dollars) (REVIEWED, NOT AUDITED)

CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax Adjustments Adjustments to reconcile profit (loss) Expected credit impairment (gain) loss Loss on (reversal of) inventory market price decline Depreciation Amortization Interest income Interest expense Changes in operating assets and liabilities Changes in operating assets Notes receivable Accounts receivable Other receivables Inventories Prepayments Changes in operating liabilities Current contract liabilities Notes payable Accounts payable Other payables Advance receipts Net defined benefit liabilities Cash inflow generated from operations Interest received Interest paid Income tax paid Net cash flows from operating activities

For the three-month periods ended March 31, Notes 2021 2020 $ 87,811 $ 53,109 12 ( 2,458 ) 1,021 6(4) 798 ( 699 ) 6(5)(6)(21) 20,083 19,272 6(7)(21) 2,673 2,922 6(17) ( 240 ) ( 544 ) 6(20) 3,699 4,886 ( 4,148 ) 2,285 ( 12,873 ) ( 8,398 ) 7,544 337 31,656 ( 14,150 ) ( 10,411 ) ( 12,120 ) 1,888 4,507 15,350 10,723 ( 591 ) 28,866 29,186 18,885 - ( 1,699 ) ( 74 ) ( 75 ) 169,893 109,128 240 544 ( 3,711 ) ( 5,087 ) ( 6,681 ) ( 14,885 ) 159,741 89,700

(Continued)

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CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2021 AND 2020 (Expressed in thousands of New Taiwan dollars) (REVIEWED, NOT AUDITED)

CASH FLOWS FROM INVESTING ACTIVITIES Increase in financial assets at amortized cost - current Cash paid for acquisition of property, plant and equipment Acquisition of intangible assets Increase in prepayments for equipment Increase in guarantee deposits paid Decrease in other non-current assets Net cash flows used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES (Decrease) increase in short-term borrowings Increase in short-term notes and bills payable Payments of lease liability Increase in long-term borrowings Decrease in long-term borrowings Purchase of treasury stocks Net cash flows used in financing activities Effect of foreign exchange rate changes on cash and cash equivalents Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period

For the three-month periods ended March 31, Notes 2021 2020 ($ 32 ) ($ 113 ) 6(25) ( 44,734 ) ( 96,786 ) 6(7) ( 428 ) ( 208 ) ( 265 ) ( 17,399 ) ( 628 ) ( 588 ) 1,629 74 ( 44,458 ) ( 115,020 ) 6(26) ( 84,508 ) 211,540 6(26) - 30,000 6(26) ( 1,295 ) ( 1,271 ) 6(26) - 100,000 6(26) ( 18,990 ) ( 319,406 ) 6(13) - ( 23,540 ) ( 104,793 ) ( 2,677 ) ( 4,558 ) ( 3,134 ) 5,932 ( 31,131 ) 6(1) 654,597 678,134 6(1) $ 660,529 $ 647,003

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

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CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated) (REVIEWED, NOT AUDITED)

1. HISTORY AND ORGANIZATION

• (1) CHIEFTEK PRECISION CO., LTD. (the “Company”) was incorporated on October 19, 1998 as a company limited by shares under the provisions of the Company Act of the Republic of China (R.O.C.) and other related regulations. The Company and its subsidiaries (collectively referred herein as the “Group”) are primarily engaged in the research, development, manufacture and sale of miniature linear guides, miniature ball screws, miniature linear modules, electro-optics equipment and semiconductor process equipment.

• (2) The common stocks of the Company were originally listed on the Taipei Exchange from December 28, 2012, and have been authorized to trade in Taiwan Stock Exchange since December 23, 2020.

• THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL STATEMENTS AND PROCEDURES FOR AUTHORIZATION

• These consolidated financial statements were authorized for issuance by the Board of Directors on May 5, 2021.

3. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS

• (1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”) New standards, interpretations and amendments endorsed by the FSC effective from 2021 are as follows:

New standards, interpretations and amendments endorsed by the FSC follows:	effective from 2021 are as
New Standards,Interpretations andAmendments	Effective date by International Accounting StandardsBoard (“IASB”)
Amendments to IFRS 4, ‘Extension of the temporary exemption from applying IFRS 9’ Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, ‘Interest Rate Benchmark Reform – Phase 2’ Amendments to IFRS 16, ‘Covid-19-related rent concessions beyond June 30, 2021’ Note: Earlier application from January 1, 2021 is allowed by the FSC.	January 1, 2021 January 1, 2021 April 1, 2021 (Note)

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

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

the Group

None.

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

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

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Effective date by
New Standards, Interpretations and Amendments IASB
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New Standards,Interpretations and Amendments	Effective date by IASB
Amendments to IFRS 3, ‘Reference to the conceptual framework’	January 1, 2022
Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets	To be determined by
between an investor and its associate or joint venture’	IASB
IFRS 17, ‘Insurance contracts’	January 1, 2023
Amendments to IFRS 17, ‘Insurance contracts’	January 1, 2023
Amendments to IAS 1, ‘Classification of liabilities as current or	January 1, 2023
non-current’
Amendments to IAS 1, ‘Disclosure of accounting policies’	January 1, 2023
Amendments to IAS 8, ‘Definition of accounting estimates’	January 1, 2023
Amendments to IAS 16, ‘Property, plant and equipment: proceeds before	January 1, 2022
intended use’
Amendments to IAS 37, ‘Onerous contracts – cost of fulfilling a contract’	January 1, 2022
Annual improvements to IFRS Standards 2018 – 2020	January 1, 2022

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

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these consolidated financial statements

are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

(1) Statement of compliance

The consolidated financial statements of the Group have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Accounting Standard 34, ‘Interim financial reporting’ endorsed by the FSC.

(2) Basis of preparation

• A. Except for the defined benefit liabilities recognized based on the net amount of pension fund assets less present value of defined benefit obligation, the consolidated financial statements have been prepared under the historical cost convention.

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

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statements are disclosed in Note 5, ‘Critical accounting judgments, estimates and key sources of assumption uncertainty’.

(3) Basis of consolidation

• A. Basis for preparation of consolidated financial statements:

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

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

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

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

• (e) When the Group loses control of a subsidiary, the Group remeasures any investment retained in the former subsidiary at its fair value. That fair value is regarded as the fair value on initial recognition of a financial asset or the cost on initial recognition of the associate or joint venture. Any difference between fair value and carrying amount is recognized in profit or loss. All amounts previously recognized in other comprehensive income in relation to the subsidiary are reclassified to profit or loss on the same basis as would be required if the related assets or liabilities were disposed of. That is, when the Group loses control of a subsidiary, all gains or losses previously recognized in other comprehensive income in relation to the subsidiary should be reclassified from equity to profit or loss, if such gains or losses would be reclassified to profit or loss when the related assets or liabilities are disposed of.

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B. Subsidiaries included in the consolidated financial statements:

Name of investor	Name of subsidiary	Business activities Professional investment Lease of real estate property Sale of high precision linear motion components and rendering after-sales service Sale of high precision linear motion components and rendering after-sales service Research, manufacture and sale of machineries Professional investment Production, processing and sale of high precision linear motion components and after-sales service	Ownership (%)	Ownership (%)	March 31, 2020 100 100 100 100 100 100 100	Note
			March 31, 2021 100 100 100 100 - 100 100	December 31, 2020 100 100 100 100 - 100 100
CHIEFTEK PRECISION CO., LTD. (“CHIEFTEK PRECISION”) CHIEFTEK PRECISION CO., LTD. CHIEFTEK PRECISION CO., LTD. CHIEFTEK PRECISION CO., LTD. CHIEFTEK PRECISION CO., LTD. CHIEFTEK PRECISION HOLDING CO., LTD. CHIEFTEK PRECISION (Hong Kong) Co., Limited	CHIEFTEK PRECISION HOLDING CO., LTD. CHIEFTEK PRECISION INTERNATIONAL LLC CHIEFTEK PRECISION USA CO., LTD. (“cpc USA”) cpc Europa GmbH (“cpc Europa”) CSM Maschinen GmbH CHIEFTEK PRECISION (Hong Kong) Co., Limited Chieftek Machinery (Kunshan) Co., Ltd. (“Chieftek (Kunshan)”)					- Note 1 Note 1 - Note 2 Note 3 - -

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• Note 1: The financial statements of the entity as of and for the three-month periods ended March 31, 2021 and 2020 were not reviewed by independent auditors as the entity did not meet the definition of a significant subsidiary.

• Note 2: The financial statements of the entity as of and for the three-month period ended March 31, 2020 were not reviewed by independent auditors as the entity did not meet the definition of a significant subsidiary.

• Note 3: CSM Machinen GmbH was merged into cpc Europa GmbH with the approval of the local authority since 2020.

The financial statements and related information disclosed in Note 13 of insignificant consolidated subsidiaries were not reviewed by independent auditors. Those statements reflect total assets of $311,237 and $285,219, constituting 9% and 8% of the consolidated total assets, and total liabilities of $86,347 and $86,539, both constituting 6% of the consolidated total liabilities as of March 31, 2021 and 2020 respectively, and total comprehensive income of $10,382 and $668, constituting 16% and 2% of the consolidated total comprehensive income for the three-month periods ended March 31, 2021 and 2020, respectively.

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

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

• E. Significant restrictions: None.

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

• (4) Foreign currency translation

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

• A. Foreign currency transactions and balances

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

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

• (c) Non-monetary assets and liabilities denominated in foreign currencies held at fair value through profit or loss are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in profit or loss. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through other comprehensive income are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in other comprehensive income. However, non-

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monetary assets and liabilities denominated in foreign currencies that are not measured at fair value are translated using the historical exchange rates at the dates of the initial transactions.

• (d) All other foreign exchange gains and losses based on the nature of those transactions are presented in the statement of comprehensive income within ‘other gains and losses’.

• B. Translation of foreign operations

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

  • i. Assets and liabilities for each balance sheet presented are translated at the closing exchange rate at the date of that balance sheet;

  • ii. Income and expenses for each statement of comprehensive income are translated at average exchange rates of that period; and

iii. All resulting exchange differences are recognized in other comprehensive income.

  - (b) When the foreign operation partially disposed of or sold is a subsidiary, cumulative exchange differences that were recorded in other comprehensive income are proportionately transferred to the non-controlling interest in this foreign operation. In addition, even when the Group retains partial interest in the former foreign subsidiary after losing control of the former foreign subsidiary, such transactions should be accounted for as disposal of all interest in the foreign operation.

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

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

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

  • (b) Assets held mainly for trading purposes;

  • (c) Assets that are expected to be realized within 12 months from the balance sheet date;

  • (d) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to settle liabilities more than 12 months after the balance sheet date.

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

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

  • (b) Liabilities arising mainly from trading activities;

  • (c) Liabilities that are to be settled within 12 months from the balance sheet date;

  • (d) Liabilities for which the repayment date cannot be extended unconditionally to more than 12 months after the balance sheet date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

~15~

(6) Cash equivalents

• A. Cash equivalents refer to short-term, highly liquid investments that are readily convertible to known amount of cash and subject to an insignificant risk of changes in value.

• B. Time deposits that meet the definition above and are held for the purpose of meeting short-term cash commitment in operations are classified as cash equivalents.

• (7) Financial assets at amortized cost

• A. Financial assets at amortized cost are those that meet all of the following criteria:

• (a) The objective of the Group’s business model is achieved by collecting contractual cash flows.

• (b) The assets’ contractual cash flows represent solely payments of principal and interest.

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

• (8) Accounts and notes receivable

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

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

• (9) Impairment of financial assets

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

• (10) Derecognition of financial assets

• The Group derecognizes a financial asset when the contractual rights to receive the cash flows from the financial asset expires.

• (11) Inventories

• Inventories are stated at the lower of cost and net realizable value. Cost is determined using the weighted-average method. The cost of finished goods and work in process comprises raw materials, direct labor, other direct costs and related production overheads (allocated based on normal operating capacity). It excludes borrowing costs. The item by item approach is used in applying the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and applicable variable selling expenses. When the cost of inventory is lower than net realizable value, a write-down is provided and recognized in operating costs. If the circumstances that caused the write-down cease to exist, such that all or part of the write-down is no longer needed, it should be reversed to that extent and recognized as deduction of operating costs.

~16~

(12) Property, plant and equipment

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

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

• C. Land is not depreciated. Other property, plant and equipment apply cost model and are depreciated using the straight-line method to allocate their cost over their estimated useful lives. Each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the item must be depreciated separately.

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

are as follows:
Assets		Useful lives
Buildings and structures	3	～	50	years
Machinery and equipment	2	～	15	years
Transportation equipment	3	～	10	years
Office equipment	1	～	10	years
Leasehold improvements	2	～	15	years
Other equipment	2	～	10	years

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

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

• B. Lease liabilities include the net present value of the remaining lease payments at the commencement date, discounted using the incremental borrowing interest rate. Lease payments are comprised of the following:

• (a) Fixed payments, less any lease incentives receivable;

• (b) Amounts expected to be payable by the lessee under residual value guarantees; and

• (c) Payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.

~17~

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

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

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

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

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

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

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

• D. For lease modifications that decrease the scope of the lease, the lessee shall remeasure the lease liability. The lessee shall also decrease the carrying amount of right-of-use assets to reflect the partial or full termination of the lease, and recognize the difference in profit or loss.

• (14) Intangible assets

• A. Trademarks and patents

Separately acquired trademarks of corporate identity system and patents are stated initially at cost. Trademarks and patents have a finite useful life and are amortized on a straight-line basis over their estimated useful lives of 10 to 20 years.

• B. Computer software

• Computer software is stated initially at cost and amortized on a straight-line basis over its estimated useful life of 3 years.

• C. Turn-key professional technique

• The subsidiary, CSM Maschinen GmbH, which has been merged into cpc Europa GmbH with the approval of the local authority since 2020, was commissioned by the Company to develop and design linear guide, robotic arm and equipment for exhibition which are stated initially at cost and amortized over the economic life of Turn-key professional technique of 10 years.

• D. Other intangible assets

• Technology contribution is stated initially at cost, and regarded as having an indefinite useful life as it is assessed to generate continuous net cash inflow in the foreseeable future. Technology contribution is not amortized, but is tested annually for impairment.

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(15) Impairment of non-financial assets

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

(16) Borrowings

• A. Borrowings comprise long-term and short-term banks loans. Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortized cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognized in profit or loss over the period of the borrowings using the effective interest method.

• B. Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the drawdown occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalized as other non-current assets for liquidity services and amortized over the period of the facility to which it relates.

(17) Notes and accounts payable

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

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

(18) Derecognition of financial liabilities

A financial liability is derecognized when the obligation specified in the contract is either discharged or cancelled or expires.

(19) Offsetting financial instruments

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

(20) Employee benefits

• A. Short-term employee benefits

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

• B. Pensions

(a) Defined contribution plans

For defined contribution plans, the contributions are recognized as pension expenses when

~19~

they are due on an accrual basis. Prepaid contributions are recognized as an asset to the extent of a cash refund or a reduction in the future payments.

  - (b) Defined benefit plans

     - i. Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employees will receive on retirement for their services with the Group in current period or prior periods. The liability recognized in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The net defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The rate used to discount is determined by using interest rates of government bonds (at the balance sheet date) of a currency and term consistent with the currency and term of the employment benefit obligations.

     - ii. Remeasurement arising on defined benefit plans is recognized in other comprehensive income in the period in which they arise and are recorded as retained earnings.

     - iii. Pension cost for the interim period is calculated on a year-to-date basis by using the pension cost rate derived from the actuarial valuation at the end of the prior financial year, adjusted for significant market fluctuations since that time and for significant curtailments, settlements, or other significant one-off events. Also, the related information is disclosed accordingly.

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

  • Employees’ compensation and directors’ and supervisors’ remuneration are recognized as expenses and liabilities, provided that such recognition is required under legal or constructive obligation and those amounts can be reliably estimated. Any difference between the resolved amounts and the subsequently actual distributed amounts is accounted for as changes in estimates. If employee compensation is distributed by shares, the Group calculates the number of shares based on the closing price at the previous day of the board meeting resolution.

• (21) Income tax

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

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

~20~

• C. Deferred tax is recognized, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated balance sheet. However, the deferred tax is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred tax is provided on temporary differences arising on investments in subsidiaries, except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax is determined using tax rates and laws that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realized or the deferred tax liability is settled.

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

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

• F. A deferred tax asset shall be recognized for the carryforward of unused tax credits resulting from equity investments to the extent that it is possible that future taxable profit will be available against which the unused tax credits can be utilized.

• G. The interim period income tax expense is recognised based on the estimated average annual effective income tax rate expected for the full financial year applied to the pretax income of the interim period, and the related information is disclosed accordingly.

(22) Share capital

• A. Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or stock options are shown in equity as a deduction, net of tax, from the proceeds.

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

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(23) Dividends

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

(24) Revenue recognition

Sales of goods

• A. The Group manufactures and sells linear guide, ball screw and linear modules. Sales are recognized when control of the products has been transferred, being when the products are delivered to the external customer, and there is no unfulfilled obligation that could affect the buyer’s acceptance of the products. Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the products in accordance with the sales contract, or the Group has objective evidence that all criteria for acceptance have been satisfied.

• B. Sales revenue is recognized based on the contract price, net of output tax and sales returns and discounts. The sales are made with a credit term of 30 ~ 180 days after monthly closing. As the time interval between the transfer of committed goods and the payment of customer does not exceed one year, the Group does not adjust the transaction price to reflect the time value of money.

• C. A receivable is recognized when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

(25) Operating segments

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

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

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

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

None.

(2) Critical accounting estimates and assumptions

Evaluation of inventories

• A. As inventories are stated at the lower of cost and net realizable value, the Group must determine

~22~

the net realizable value of inventories on balance sheet date using judgements and estimates. Due to the rapid technology innovation, the Group evaluates the amounts of normal inventory consumption, obsolete inventories or inventories without market selling value on balance sheet date, and writes down the cost of inventories to the net realizable value. Such an evaluation of inventories is calculated based on the inventory clearance and historical data of discounts. Therefore, there might be material changes to the evaluation.

• B. As of March 31, 2021, the carrying amount of inventories was $525,504.

6. DETAILS OF SIGNIFICANT ACCOUNTS

(1) Cash and cash equivalents

Cash and cash equivalents
Cash: Cash on hand Checking accounts and demand deposits Cash Equivalents: Time deposits	March31,2021 1,343 $ 657,753 659,096 1,433 660,529 $	December31,2020 1,369 $ 651,729 653,098 1,499 654,597 $	March31,2020 1,337 $ 644,237
			645,574
			1,429
			647,003 $

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

• B. The Group has no cash and cash equivalents pledged to others as of March 31, 2021, December 31, 2020 and March 31, 2020.

(2) Financial assets at amortized cost - current

==> picture [482 x 42] intentionally omitted <==

• A. The Group recognized interest income of $18 and $51 from financial assets at amortized cost for the three-month periods ended March 31, 2021 and 2020, respectively, shown as part of “Interest Income”.

• B. As of March 31, 2021, December 31, 2020 and March 31, 2020, without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the financial assets at amortized cost held by the Group was its book value.

• C. The Group has no financial assets at amortized cost pledged to others as of March 31, 2021, December 31, 2020 and March 31, 2020.

• D. Information relating to credit risk of financial assets at amortized cost is provided in Note 12(2), ‘Financial instruments’.

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(3) Notes and accounts receivable, net

			March31,2021	December	December	31,2020			March31,2020
Notes receivable		$	31,915		$	27,767		$	25,274
			March 31, 2021	December		31, 2020			March 31, 2020
Accounts receivable		$	382,818		$	370,745		$	333,095
Less: Allowance for doubtful
accounts	(		22,405)	(		26,070)	(		26,602)
		$	360,413		$	344,675		$	306,493

• A. The ageing analysis of the Group’s notes and accounts receivable is as follows:

Not past due Up to 30 days 31 to 90 days 91 to 180 days Over 180 days	Accounts Notes receivable receivable 322,508 $ 31,741 $ 14,654 - 21,630 174 5,289 - 18,737 - 382,818 $ 31,915 $ March 31, 2021	December	Notes receivable 27,767 $ - - - - 27,767 $ 31,2020	March 31, 2020	March 31, 2020
	Accounts receivable 322,508 $ 14,654 21,630 5,289 18,737 382,818 $	Accounts receivable 283,508 $ 11,726 41,760 15,188 18,563 370,745 $		Accounts receivable 235,353 $ 12,273 37,374 19,842 28,253 333,095 $	Notes receivable
					24,887 $ 217 170 - -
					25,274 $

The above ageing analysis was based on past due date.

• B. As of March 31, 2021, December 31, 2020, March 31, 2020 and January 1, 2020, the balances of notes receivable and accounts receivable from contracts with customers amounted to $414,733, $398,512, $358,369 and $352,262, respectively.

• C. Without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the Group’s notes and accounts receivable was its book value.

• D. As of March 31, 2021, December 31, 2020 and March 31, 2020, the Group does not hold any collateral as security for accounts receivable.

• E. Information relating to credit risk is provided in Note 12(2), ‘Financial instruments’.

(4) Inventories

Inventories
Raw materials Supplies Work in process Finished goods		March31,2021
	Allowance for Cost market price decline 76,539 $ 2,853) ($ 65,562 9,530) ( 272,151 15,811) ( 177,912 38,466) ( 592,164 $ 66,660) ($		Bookvalue
			73,686 $ 56,032 256,340 139,446
			525,504 $

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December 31, 2020

December31,2020
Allowance for Cost market price decline Raw materials 80,104 $ 2,714) ($ Supplies 67,896 10,676) ( Work in process 274,069 13,003) ( Finished goods 201,751 40,484) ( 623,820 $ 66,877) ($	Bookvalue
	77,390 $ 57,220 261,066 161,267
	556,943 $

Raw materials Supplies Work in process Finished goods	Allowance for Cost market price decline 77,047 $ 22) ($ 66,040 6,267) ( 345,373 6,392) ( 212,810 36,240) ( 701,270 $ 48,921) ($ March 31, 2020	Bookvalue
		77,025 $ 59,773 338,981 176,570
		652,349 $

The cost of inventories recognized as expense for the period:

	For the three-month periods	For the three-month periods	For the three-month periods	For the three-month periods	ended March 31,
		2021			2020
Cost of goods sold	$	241,604		$	160,565
Allowance for (reversal of) inventory market price
decline		798	(		699)
Loss on physical inventory		146			283
Revenue from sale of scraps	(	164)	(		128)
	$	242,384		$	160,021

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(5) Property, plant and equipment

AtJanuary1,2021 Cost Accumulated depreciation For the three-month period ended March31,2021 At January 1, 2021 Additions Transferred from prepayments for equipment Transferred after acceptance inspection Depreciation Disposals－Cost －Accumulated depreciation Net currency exchange differences At March 31, 2021 At March31,2021 Cost Accumulated depreciation

Construction Leasehold in progress Buildings improvements and equipment and Machinery and Transportation Office and other before acceptance Land structures equipment equipment equipment equipment inspection Total 367,121 $ 750,993 $ 944,425 $ 6,789 $ 22,495 $ 156,286 $ 443,763 $ 2,691,872 $ - 166,993) ( 831,312) ( 4,915) ( 19,627) ( 136,905) ( - 1,159,752) ( 367,121 $ 584,000 $ 113,113 $ 1,874 $ 2,868 $ 19,381 $ 443,763 $ 1,532,120 $ 367,121 $ 584,000 $ 113,113 $ 1,874 $ 2,868 $ 19,381 $ 443,763 $ 1,532,120 $ - 150 607 - 136 562 46,233 47,688 - - - - - - 975 975 - 193 260 - - 10,174 10,627) ( - - 5,136) ( 10,406) ( 130) ( 375) ( 2,480) ( - 18,527) ( - - 139) ( - 908) ( 15) ( - 1,062) ( - - 139 - 908 15 - 1,062 97 209 303) ( 2) ( 7) ( 56) ( - 62) ( 367,218 $ 579,416 $ 103,271 $ 1,742 $ 2,622 $ 27,581 $ 480,344 $ 1,562,194 $ 367,218 $ 751,590 $ 944,470 $ 6,762 $ 21,680 $ 166,794 $ 480,344 $ 2,738,858 $ - 172,174) ( 841,199) ( 5,020) ( 19,058) ( 139,213) ( - 1,176,664) ( 367,218 $ 579,416 $ 103,271 $ 1,742 $ 2,622 $ 27,581 $ 480,344 $ 1,562,194 $

~26~

AtJanuary1,2020 Cost Accumulated depreciation For the three-month period ended March31,2020 At January 1, 2020 Additions Transferred from prepayments for equipment Transferred after acceptance inspection Depreciation Disposals－Cost －Accumulated depreciation Net currency exchange differences At March 31, 2020 At March31,2020 Cost Accumulated depreciation

Construction Leasehold in progress Buildings improvements and equipment and Machinery and Transportation Office and other before acceptance Land structures equipment equipment equipment equipment inspection Total 369,768 $ 606,091 $ 896,524 $ 6,654 $ 21,295 $ 146,309 $ 335,290 $ 2,381,931 $ - 151,497) ( 788,483) ( 4,354) ( 17,750) ( 128,888) ( - 1,090,972) ( 369,768 $ 454,594 $ 108,041 $ 2,300 $ 3,545 $ 17,421 $ 335,290 $ 1,290,959 $ 369,768 $ 454,594 $ 108,041 $ 2,300 $ 3,545 $ 17,421 $ 335,290 $ 1,290,959 $ - 626 1,429 - 638 320 108,282 111,295 - - - - - - 28,271 28,271 - - 2,480 - - 1,350 3,830) ( - - 4,484) ( 10,667) ( 130) ( 426) ( 2,009) ( - 17,716) ( - - - - 27) ( - - 27) ( - - - - 27 - - 27 432 965 79) ( 2) ( 5) ( 16) ( - 1,295 370,200 $ 451,701 $ 101,204 $ 2,168 $ 3,752 $ 17,066 $ 468,013 $ 1,414,104 $ 370,200 $ 607,845 $ 900,252 $ 6,633 $ 21,873 $ 147,921 $ 468,013 $ 2,522,737 $ - 156,144) ( 799,048) ( 4,465) ( 18,121) ( 130,855) ( - 1,108,633) ( 370,200 $ 451,701 $ 101,204 $ 2,168 $ 3,752 $ 17,066 $ 468,013 $ 1,414,104 $

~27~

• A. Property, plant and equipment of the Group were all for operating purposes as of March 31, 2021, December 31, 2020 and March 31, 2020.

• B. For the three-month periods ended March 31, 2021 and 2020, no borrowing costs were capitalized as part of property, plant and equipment.

• C. Information about the property, plant and equipment that were pledged to others as collateral as of March 31, 2021, December 31, 2020 and March 31, 2020 is provided in Note 8, ‘Pledged assets’.

• －

• (6) Leasing arrangements lessee

• A. The Group leases land in Southern Taiwan Science Park of Ministry of Science and Technology. Rental contracts are typically made for a period of 20 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions.

B.	The carrying amount of right-of-use assets and the depreciation charge are as follows: Carrying amount: March 31,2021 December 31, 2020 March 31, 2020 Land 128,045 $ 129,601 $ 134,269 $ Depreciation charge: 2021 2020 Land 1,556 $ 1,556 $ For the three-month periods ended March 31,

• C. For the three-month periods ended March 31, 2021 and 2020, the Group has no additions to rightof-use assets.

• D. The information on income and expense accounts relating to lease contracts is as follows:

Items affecting profit or loss Interest expense on lease liabilities Expense on short-term lease contracts	For the three-month periods ended March 31,
	2021 2020 590 $ 613 $ 3,047 $ 3,052 $

• E. For the three-month periods ended March 31, 2021 and 2020, the Group’s total cash outflow for leases were $4,932 and $4,936, respectively.

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(7) Intangible assets

Intangible assets
												Turn-key
												professional
			Trademarks			Patents			Software			technique			Others			Total
At January 1, 2021
Cost		$	578		$	10,106		$	12,848		$	90,718		$	60,000		$	174,250
Accumulated amortization	(		578)	(		3,724)	(		12,155)	(		9,072)	(		13,500)	(		39,029)
Accumulated impairment			-			-			-			-	(		33,626)	(		33,626)
Net value		$	-		$	6,382		$	693		$	81,646		$	12,874		$	101,595
For the three-month period ended
March31,2021
Net value at January 1, 2021		$	-		$	6,382		$	693		$	81,646		$	12,874		$	101,595
Additions－acquired separately			-			302			126			-			-			428
Amortization			-	(		187)	(		218)	(		2,268)			-	(		2,673)
Net currency exchange differences			-			-	(		13)			-			-	(		13)
Net value at March 31, 2021		$	-		$	6,497		$	588		$	79,378		$	12,874		$	99,337
At March 31, 2021
Cost		$	578		$	10,408		$	12,865		$	90,718		$	60,000		$	174,569
Accumulated amortization	(		578)	(		3,911)	(		12,277)	(		11,340)	(		13,500)	(		41,606)
Accumulated impairment			-			-			-			-	(		33,626)	(		33,626)
Net value		$	-		$	6,497		$	588		$	79,378		$	12,874		$	99,337

~29~

												Turn-key
												professional
			Trademarks			Patents			Software			technique			Others			Total
At January 1, 2020
Cost		$	578		$	9,323		$	12,746		$	90,718		$	60,000		$	173,365
Accumulated amortization	(		578)	(		3,114)	(		10,606)			-	(		13,500)	(		27,798)
Accumulated impairment			-			-			-			-	(		24,577)	(		24,577)
Net value		$	-		$	6,209		$	2,140		$	90,718		$	21,923		$	120,990
For the three-month period ended
March31,2020
Net value at January 1, 2020		$	-		$	6,209		$	2,140		$	90,718		$	21,923		$	120,990
Additions－acquired separately			-			208			-			-			-			208
Amortization			-	(		148)	(		506)	(		2,268)			-	(		2,922)
Net currency exchange differences			-			-	(		9)			-			-	(		9)
Net value at March 31, 2020		$	-		$	6,269		$	1,625		$	88,450		$	21,923		$	118,267
At March 31, 2020
Cost		$	578		$	9,531		$	12,722		$	90,718		$	60,000		$	173,549
Accumulated amortization	(		578)	(		3,262)	(		11,097)	(		2,268)	(		13,500)	(		30,705)
Accumulated impairment			-			-			-			-	(		24,577)	(		24,577)
Net value		$	-		$	6,269		$	1,625		$	88,450		$	21,923		$	118,267

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• A. For the three-month periods ended March 31, 2021 and 2020, no borrowing costs were capitalized as part of intangible assets.

• B. Details of amortization on intangible assets are as follows:

For the three-month periods ended March 31,

	For t	he three-month pe	riods	ended March 31,
		2021		2020
General and administrative expenses	$	214	$	236
Research and development expenses		2,459		2,686
	$	2,673	$	2,922

(8) Short-term borrowings

Short-term borrowings
Nature Bank unsecured borrowings Nature Bank unsecured borrowings Bank secured borrowings Nature Bank unsecured borrowings Bank secured borrowings	March 31,2021 294,000 $ December 31,2020 358,000 $ 21,012 379,012 $ March 31,2020 493,000 $ 31,578 524,578 $	Interest rate range 0.52%~0.90% Interest rate range 0.52%~0.95% 1.30% Interest rate range 0.758%～1.03% 1.30%	Collateral
			None Collateral None Endorsements and guarantees by the Company Collateral
			None Endorsements and guarantees by the Company

For more information about interest expense recognized by the Group for the three-month periods ended March 31, 2021 and 2020, please refer to Note 6(20), ‘Finance costs’.

(9) Short-term notes and bills payable

Commercial papers payable	March 31, 2020 30,000 $	Interestraterange 0.938%	Collateral
			None

The Group had no short-term notes and bills payable as of March 31, 2021 and December 31, 2020.

• A. The above commercial papers were issued and secured by Union Bank of Taiwan Co., Ltd. for short-term financing.

• B. For more information about interest expense recognized by the Group for the three-month period ended March 31, 2020, please refer to Note 6(20), ‘Finance costs’.

~31~

(10) Other payables

March 31,2021 Dividends payable 121,114 $ Accrued salaries and bonuses 56,582 Employees’ compensation and directors’ and supervisors’ remuneration payable 34,756 Equipment payable 4,851 Others 43,418 260,721 $	December 31,2020 - $ 52,658 20,500 5,253 32,424 110,835 $	March 31,2020 - $ 43,084 29,920 55,611 50,586 179,201 $

- (11) Long term borrowings

Long-term borrowings
Nature	Expirydate March31,2021 August 21, 2023～ December 28, 2027 433,814 $ February 22, 2022～ May 15, 2027 160,000 593,814 100,929) ( 492,885 $ Expirydate December31,2020 August 21, 2023～ December 28, 2027 440,142 $ February 22, 2022～ May 15, 2027 172,500 612,642 94,658) ( 517,984 $ Expirydate March31,2020 January 24, 2023～ March 20, 2025 263,365 $ February 22, 2023 100,000 363,365 75,696) ( 287,669 $	Interest rate range	Collateral
Long-term bank borrowings Secured borrowings Unsecured borrowings Less: Current portion Nature		1.04%～ 2.81% 1.25%～ 1.30% Interest rate range	Land, buildings and structures None Collateral
Long-term bank borrowings Secured borrowings Unsecured borrowings Less: Current portion Nature		1.04%～ 2.81% 1.25%～ 1.30% Interest rate range	Land, buildings and structures None Collateral
Long-term bank borrowings Secured borrowings Unsecured borrowings Less: Current portion		1.23%～ 4.43% 1.25%	Land, buildings and structures None

~32~

For more information about interest expense recognized by the Group for the three-month periods ended March 31, 2021 and 2020, please refer to Note 6(20), ‘Finance costs’.

• (12) Pensions

• A. (a) The Company has a defined benefit pension plan in accordance with the Labor Standards Law, covering all regular employees’ service years prior to the enforcement of the Labor Pension Act on July 1, 2005 and service years thereafter of employees who chose to continue to be subject to the pension mechanism under the Law. Under the defined benefit pension plan, two units are accrued for each year of service for the first 15 years and one unit for each additional year thereafter, subject to a maximum of 45 units. Pension benefits are based on the number of units accrued and the average monthly salaries and wages of the last 6 months prior to retirement. The Company contributes monthly an amount equal to 2% of the employees’ monthly salaries and wages to the retirement fund deposited with Bank of Taiwan, the trustee, under the name of the independent retirement fund committee. Also, the Company would assess the balance in the aforementioned labor pension reserve account by December 31, every year. If the account balance is not enough to pay the pension calculated by the aforementioned method to the employees expected to qualify for retirement in the following year, the Company will make contribution for the deficit by next March.

  • (b) No pension cost was recognized under the aforementioned defined benefit pension plan of the Company for the three-month periods ended March 31, 2021 and 2020.

  • (c) Expected contributions to the defined benefit pension plans of the Group for the year ending December 31, 2021 amount to $297.

• B. Effective July 1, 2005, the Company has established a defined contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular employees with R.O.C. nationality. Under the New Plan, the Company contributes monthly an amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment. The other subsidiaries are subject to local government sponsored defined contribution plan. In accordance with related laws of the respective local government, the independent pension fund of employees is administered by the government. Other than the monthly contributions, these subsidiaries do not have further obligations. The pension costs under the defined contribution pension plans of the Group for the three-month periods ended March 31, 2021 and 2020 were $3,182 and $3,659, respectively.

~33~

(13) Share capital

• A. Movements in the number of the Company’s ordinary shares outstanding are as follows (in thousands of shares):

Balance at beginning of period Purchase of treasury stocks Balance at end of period	2021 2020 80,743 81,188 - 399) ( 80,743 80,789 Forthe three-monthperiods endedMarch31,

• B. Treasury stocks

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

==> picture [439 x 165] intentionally omitted <==

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

For the three-month period ended March 31, 2021
Shares at
beginning Shares at
Reason for reacquisition of period Increase Decrease end of period
To be reissued to employees 445 - - 445
For the three-month period ended March 31, 2020
Shares at
beginning Shares at
Reason for reacquisition of period Increase Decrease end of period
To be reissued to employees - 399 - 399
----- End of picture text -----

• (b) Pursuant to the R.O.C. Securities and Exchange Act, the number of shares bought back as treasury stock should not exceed 10% of the number of the Company’s issued and outstanding shares and the amount bought back should not exceed the sum of retained earnings, paid-in capital in excess of par value and realized capital surplus. As of March 31, 2021, December 31, 2020 and March 31, 2020, the treasury shares amounted to $26,550, $26,550 and $23,540, respectively.

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

• (d) Pursuant to the R.O.C. Securities and Exchange Act, treasury stocks should be reissued to the employees within 5 years from the reacquisition date and shares not reissued within the 5 year period are to be retired.

• C. As of March 31, 2021, the Company’s authorized capital was $1,500,000 (including $30,000 reserved for employee stock options), and the paid-in capital was $811,876 (81,188 thousand shares) with par value of $10 (in dollars) per share.

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(14) Capital reserve

For the three-month periods ended March 31, 2021 and 2020 Share premium Others Total Balances at beginning and end of period $ 440,553 $ 114 $ 440,667

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

(15) Retained earnings

• A. The legal reserve shall be exclusively used to cover accumulated deficit, to issue new stocks, or to distribute cash to shareholders in proportion to their share ownership. The use of legal reserve for the issuance of stocks or cash dividends to shareholders in proportion to their share ownership is permitted provided that the balance of such reserve exceeds 25% of the Company’s paid-in capital.

• B. According to the Company’s Articles of Incorporation, the Company’s dividend policy is to distribute the current year’s earnings, if any, in the following order:

• (1) pay all taxes and dues;

• (2) offset any loss of prior years;

• (3) set aside 10% as legal reserve;

• (4) set aside or reverse special reserve as required by regulations or the Competent Authority;

• (5) The appropriation of the remaining amount after deducting items (1) to (4), along with the unappropriated retained earnings of prior years can be distributed in accordance with a resolution passed during a meeting of the Board of Directors and approved at the shareholders’ meeting. However, the distribution of dividends shall not be lower than 20% of the current year’s profit after deducting items (1) to (4). In order to continually expand the scale of operations, increase competitiveness and support the Company’s long-term development plans, future capital requirements and long-term financial plan, the Company’s dividend policy is to distribute stock dividends and partially as cash dividends. Cash dividends shall not be less than 10% of the total dividends distributed to shareholders. The Board of Directors of the Company shall adopt a resolution by a majority of more than two-thirds of the directors present to distribute whole or a part of the distributable dividends, bonuses, capital reserves or legal reserve in the form of cash, and report to the shareholders during their meetings. The above is not subject to provisions that require shareholders’ approval.

• C. In accordance with the regulations, the Company shall set aside special reserve from the debit balance on other equity items at the balance sheet date before distributing earnings. When debit

~35~

• balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings. As of December 31, 2019, pursuant to the regulations for the deduction amount to stockholders’ equity from other equity items, the Company has set aside special reserve of $29,394, which cannot be distributed to shareholders.

• D. The Company recognized cash dividends distributed to owners amounting to $80,743 ($1.0 (in dollars) per share) for the year ended December 31, 2020. On February 25, 2021, the Board of Directors resolved the distribution of cash dividends from 2020 earnings in the amount of $121,114 ($1.5 (in dollars) per share).

(16) Operating revenue

$121,114 ($1.5 (in dollars) per share). Operating revenue
		For the three-monthperiods		ended March 31,
		2021		2020
Revenue from contracts with customers	$	418,654	$	290,490

• A. The Group derives revenue from the transfer of goods at a point in time in segments. Please refer to Note 14, ‘Segment information’ for details.

• B. The Group has recognized revenue-related contract liabilities amounting to $6,695, $4,807, $8,471 and $3,964 as of March 31, 2021, December 31, 2020, March 31, 2020 and January 1, 2020, respectively. Revenue recognized that were included in the contract liability balance at the beginning of 2021 and 2020 for the three-month periods ended March 31, 2021 and 2020 were $4,310 and $747, respectively.

(17) Interest income

For the three-month periods ended March 31,

Interest income from bank deposits Interest income from financial assets measured at amortized cost Other interest income	2021 222 $ 18 - 240 $	2020
		490 $ 51 3
		544 $

(18) Other income

Other income – others

For the three-monthperiods ended March31,	For the three-monthperiods ended March31,
2021 721 $	2020
	1,748 $

(19) Other gains and losses

For the three-month periods ended March 31,

Currency exchange (loss) gain Other losses

	2021			2020
($		4,422)	$		4,536
(		145)	(		1)
($		4,567)	$		4,535

~36~

(20) Finance costs

Finance costs
		For the three-monthperiods		ended March 31,
		2021		2020
Interest expense:
Interest expense on bank borrowings	$	3,109	$	4,273
Interest expense on lease liabilities		590		613
	$	3,699	$	4,886

(21) Expenses by nature

Expenses by nature
Employee benefit expense Depreciation Amortization Employee benefit expense Depreciation Amortization	Operatingcost Operatingexpense Total 69,876 $ 54,434 $ 124,310 $ 14,408 5,675 20,083 - 2,673 2,673 84,284 $ 62,782 $ 147,066 $ Operating cost Operating expense Total 54,418 $ 45,273 $ 99,691 $ 15,330 3,942 19,272 - 2,922 2,922 69,748 $ 52,137 $ 121,885 $ Forthe three-monthperiod endedMarch31,2021 Forthe three-monthperiod endedMarch31,2020
		121,885 $

(22) Employee benefit expense

Employee benefit expense
Wages and salaries Labor and health insurance expense Pension costs Other personnel expenses Wages and salaries Labor and health insurance expense Pension costs Other personnel expenses	Forthe three-monthperiod endedMarch31,2021
	Operating cost Operating expense Total 60,148 $ 50,955 $ 111,103 $ 5,370 1,958 7,328 2,417 765 3,182 1,941 756 2,697 69,876 $ 54,434 $ 124,310 $ Forthe three-monthperiod endedMarch31,2020		Total
			111,103 $ 7,328 3,182 2,697
			124,310 $
	Operating cost 45,632 $ 4,658 2,026 2,102 54,418 $	Operating expense 39,409 $ 2,822 1,633 1,409 45,273 $	Total
			85,041 $ 7,480 3,659 3,511
			99,691 $

A. According to the Articles of Incorporation of the Company, a ratio of distributable profit of the current year, after covering accumulated losses, shall be distributed as employees’ compensation

~37~

and directors’ and supervisors’ remuneration. The ratio shall be 3% to 15% for employees’ compensation and shall not be higher than 3% for directors’ and supervisors’ remuneration.

• B. For the three-month periods ended March 31, 2021 and 2020, the Company’s employees’ compensation was accrued at $11,405 and $7,536, respectively; while directors’ and supervisors’ remuneration was accrued at $2,851 and $1,884, respectively. The aforementioned amounts were recognized in salary expenses, and were estimated and accrued based on the profit as of the end of the reporting period and the percentage specified in the Articles of Incorporation of the Company.

The employees’ compensation and directors’ and supervisors’ remuneration for 2020 as resolved by the Board of Directors were $16,000 and $4,500, respectively, and the employees’ compensation was distributed in the form of cash. Employees’ compensation and directors’ and supervisors’ remuneration for 2020 as resolved by the Board of Directors were equal to the amounts recognized in the 2020 financial statements.

Information about the appropriation of employees’ compensation and directors’ and supervisors’ remuneration by the Company as proposed by the Board of Directors is posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

(23) Income tax

A. Income tax expense:

Components of income tax expense:

Current income tax: Income tax incurred in current period Prior year income tax under (over) estimation Total current income tax Deferred income tax: Origination and reversal of temporary differences Income tax expense	2021 2020 9,094 $ 3,575 $ 2,487 1,034) ( 11,581 2,541 9,751 6,644 21,332 $ 9,185 $ Forthe three-monthperiods endedMarch31,

• B. The Company’s income tax returns through 2019 have been assessed and approved by the Tax Authority. There were no disputes existing between the Company and the Tax Authority as of May 5, 2021.

~38~

(24) Earnings per share (“EPS”)

Earnings per share (“EPS”)
Basic earnings per share Profit attributable to ordinary shareholders of the parent Diluted earnings per share Profit attributable to ordinary shareholders of the parent Assumed conversion of all dilutive potential ordinary shares Employees’ compensation Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares Basic earnings per share Profit attributable to ordinary shareholders of the parent Diluted earnings per share Profit attributable to ordinary shareholders of the parent Assumed conversion of all dilutive potential ordinary shares Employees’ compensation Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares	Forthe three-monthperiod endedMarch31,2021
	Weighted average number of shares outstanding EPS Amount aftertax (sharesinthousands) (indollars) 66,479 $ 80,743 0.82 $ 66,479 $ 80,743 - 180 66,479 $ 80,923 0.82 $ Forthe three-monthperiod endedMarch31,2020	EPS (indollars)
		0.82 $
		0.82 $
	Weighted average number of shares outstanding Amount aftertax (sharesinthousands) 43,924 $ 81,161 43,924 $ 81,161 - 257 43,924 $ 81,418	EPS (indollars)
		0.54 $
		0.54 $

~39~

(25) Supplemental cash flow information

A. Investing activities with partial cash payments

			Forthe three-monthperiods	Forthe three-monthperiods	Forthe three-monthperiods	endedMarch31,
			2021			2020
Purchase of property, plant and equipment		$	47,688		$	111,295
Add: Opening balance of notes payable			11,803			25,323
Opening balance of payable for
equipment			5,253			30,601
Less: Ending balance of notes payable	(		15,159)	(		14,822)
Ending balance of payable for
equipment	(		4,851)	(		55,611)
Cash paid during the period		$	44,734		$	96,786
Operating, investing and financing activities		with no cash flow effects
			For the three-month periods			ended March 31,
			2021			2020
(a) Write-offs of allowance for bad debts		$	800		$	6
			For the three-month periods			ended March 31,
			2021			2020
(b) Prepayments for equipment reclassified
to property, plant and equipment		$	975		$	28,271
			For the three-month periods			ended March 31,
			2021			2020
(c) Cash dividends appropriation		$	121,114		$	-

B. Operating, investing and financing activities with no cash flow effects

(26) Changes in liabilities from financing activities

									Liabilities from	Liabilities from
		Short-term					Long-term			financing
		borrowings		Lease	liability		borrowings			activities-gross
At January 1, 2021	$	379,012	$		131,800	$	612,642	$		1,123,454
Changes in cash flow from
financing activities	(	84,508)	(		1,295)	(	18,990)	(		104,793)
Impact of changes in
foreign exchange rate	(	504)			-		162	(		342)
At March 31, 2021	$	294,000	$		130,505	$	593,814	$		1,018,319

~40~

Short-term borrowings At January 1, 2020 313,315 $ Changes in cash flow from financing activities 211,540 Changes in cash flow from other non-financing activities - Impact of changes in foreign exchange rate 277) ( At March 31, 2020 524,578 $	Short-term notes and Lease Long-term billspayable liability borrowings - $ 131,343 $ 582,113 $ 30,000 1,271) ( 219,406) ( - 5,577 - - - 658 30,000 $ 135,649 $ 363,365 $	Liabilities from financing activities-gross 1,026,771 $ 20,863 5,577 381
		1,053,592 $

7. RELATED PARTY TRANSACTIONS

(1) Significant transactions and balances with related parties

None.

(2) Key management compensation

None. Key management compensation
Salaries and other short-term employee benefits	For the three-monthperiods ended March31,
	2021 8,095 $	2020
		8,170 $

8. PLEDGED ASSETS

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

==> picture [507 x 31] intentionally omitted <==

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

Book value
Asset pledged March 31, 2021 December 31, 2020 March 31, 2020 Purpose of collateral
----- End of picture text -----

Land (Note) Buildings and structures-net (Note)	367,218 $ 552,308 919,526 $	367,121 $ 555,652 922,773 $	370,200 $ Guarantee for long- term borrowings 288,460 Guarantee for long- term borrowings 658,660 $

(Note) Listed as ‘Property, plant and equipment’.

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACT

COMMITMENTS

(1) As of March 31, 2021, December 31, 2020 and March 31, 2020, the endorsements and guarantees provided by the Company to the subsidiary, cpc Europa GmbH, amounted to $100,400, $157,590 and － $149,580, respectively, and the actual amounts drawn down were $ , $21,012 and $31,578, respectively; the endorsements and guarantees provided by the Company to the subsidiary, － － CHIEFTEK PRECISION INTERNATIONAL LLC, amounted to $ , $ and $60,450, respectively, and the actual amounts drawn down were all $ － .

(2) As of March 31, 2021, December 31, 2020 and March 31, 2020, the Group’s remaining balance due for construction in progress and prepayments for equipment were $327,543, $373,754 and $508,659,

~41~

respectively.

• (3) On February 19, 2020, the Company entered into a mid-term secured syndicated loan contract for a credit line facility of $2,900,000 with 11 financial institutions including Mega International Commercial Bank Co., Ltd.. The credit term is 7 years. Under the terms of the syndicated loan, the Company agrees that:

• A. The financial ratios stated in the Company’s semi-annual reviewed financial statements and annual audited financial statements shall meet the following financial ratios which will be assessed semiannually:

  • (a) Current ratio (current assets/current liabilities): At least 100%.

  • (b) Liability ratio (total liabilities/net equity): Less than 220% in 2020; less than 200% in 2021 and 2022; less than 180% from 2023.

  • (c) Tangible net value (shareholders’ equity less intangible assets): At least $1,000,000.

• B. If the Company violates the above financial covenants, the Company should improve within 9 months after the fiscal year or half fiscal year. It will not be considered to default, if the audited or reviewed financial rates comply with the covenants after the improvement period. During the improvement period, the credit line which has not been withdrawn will be frozen, until the financial covenants are met. In addition, for withdrawn credit, its financing rate shall be increased by an additional 0.125% per annum from the date after the notification by the management bank to the date after the completion of improvement.

As of March 31, 2021, the Company has not violated any of the above covenants.

• －

• (4) For the details of operating lease agreements, please refer to Note 6(6), ‘Leasing arrangements lessee’.

10. SIGNIFICANT DISASTER LOSS

None.

11. SIGNIFICANT SUBSEQUENT EVENTS

None.

12. OTHERS

(1) Capital management

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

(2) Financial instruments

• A. Details of the Group’s financial instruments by category are provided in Note 6.

• B. Financial risk management policies

• (a) The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk, interest rate risk and price risk), credit risk and liquidity risk.

~42~

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

• C. Significant financial risks and degrees of financial risks

• (a) Market risk

  • I. Foreign exchange risk

  • (i) The Group operates internationally and is exposed to foreign exchange risk arising from the transactions of the Company and its subsidiaries denominated in various functional currency, primarily with respect to USD, EUR and JPY. Foreign exchange risk arises from future commercial transactions and recognized assets and liabilities.

  • (ii)Management has set up a policy to require group companies to manage their foreign exchange risk against their functional currency. The companies are required to hedge their entire foreign exchange risk exposure with the Group treasury.

  • (iii)The Group treasury’s risk management policy is to hedge anticipated cash flows (mainly sale export and purchase of inventory) in the major foreign currency in the future so as to decrease the risk exposure in the major foreign currency.

  • (iv)The Group has certain investments in foreign operations, whose net assets are exposed to foreign currency translation risk. However, as the objective of the net investments in foreign operations is for strategic purposes, the Group does not hedged the investments.

  • (v)The Group’s businesses involve some non-functional currency operations (the Company’s functional currency: NTD, the subsidiaries’ functional currency: USD, EUR and CNY). The information on assets and liabilities denominated in foreign currencies whose values would be materially affected by the exchange rate fluctuations is as follows:

~43~

Foreign currency Exchange amount (inthousands) rate (Foreign currency: functional currency) Financial assets Monetary items USD:NTD 9,477 $ 28.535 JPY:NTD 51,781 0.2577 EUR:NTD 877 33.48 Financial liabilities Monetary items USD:NTD 1 28.535 JPY:NTD 10,548 0.2577 EUR:NTD 449 33.48 Foreign currency Exchange amount (inthousands) rate (Foreign currency: functional currency) Financial assets Monetary items USD:NTD 10,750 $ 28.48 JPY:NTD 32,962 0.2763 EUR:NTD 729 35.02 Financial liabilities Monetary items USD:NTD 3 28.48 JPY:NTD 5,274 0.2763 EUR:NTD 927 35.02 Foreign currency Exchange amount(in thousands) rate (Foreign currency: functional currency) Financial assets Monetary items USD:NTD 8,742 $ 30.225 JPY:NTD 27,382 0.2788 EUR:NTD 2,195 33.24 Financial liabilities Monetary items USD:NTD 3 30.225 JPY:NTD 5,742 0.2788 EUR:NTD 463 33.24 March31,2021 December31,2020 March31,2020	March31,2021	March31,2021
			Book value (NTD)
			270,421 $ 13,344 29,377 19 2,718 15,024
			Book value (NTD)
			306,154 $ 9,107 25,525 83 1,457 32,506
		Exchange rate 30.225 0.2788 33.24 30.225 0.2788 33.24	Book value (NTD)
			264,241 $ 7,634 72,954 87 1,601 15,365

~44~

Sensitivity analysis of foreign exchange risk is primarily for foreign currency monetary items at financial reporting date. If the exchange rate of NTD to other currencies had appreciated/depreciated by 1% with all other factors remaining constant, the Group’s net profit (loss) after tax for the three-month periods ended March 31, 2021 and 2020 would increase/decrease by $2,363 and $2,638, respectively.

• (vi)The total exchange (loss) gain, including realized and unrealized arising from significant foreign exchange variation on the monetary items held by the Group for the three-month periods ended March 31, 2021 and 2020 amounted to ($4,422) and $4,536, respectively.

• II. Price risk

The Group did not engage in any financial instruments with price variations, thus, the Group does not expect market risk arising from variations in the market prices.

III. Cash flow and fair value interest rate risk

  - (i) The Group’s main interest rate risk arises from short-term and long-term borrowings with variable rates, which expose the Group to cash flow interest rate risk. However, partial interest rate risk is offset by cash and cash equivalents held at variable rates. For the three-month periods ended March 31, 2021 and 2020, the Group’s borrowings at variable rate were mainly denominated in NTD, USD and EUR.

  - (ii) The Group’s borrowings are measured at amortized cost. The borrowings are periodically contractually repriced and to that extent are also exposed to the risk of future changes in market interest rates.

  - (iii) If the borrowing interest rate had increased/decreased by 10% with all other variables held constant, profit, net of tax for the three-month periods ended March 31, 2021 and 2020 would have decreased/increased by $249 and $342, respectively. The main factor is that changes in interest expense result from floating rate borrowings.

• (b) Credit risk

• I. Credit risk refers to the risk of financial loss to the Group arising from default by the clients or counterparties of financial instruments on the contract obligations. The main factor is that counterparties could not repay in full the accounts receivable based on the agreed terms.

• II. The Group manages its credit risk taking into consideration the entire group’s concern. According to the Group’s credit policy, each local entity in the Group is responsible for managing and analyzing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. Internal risk control assesses the credit quality of the customers, taking into account their financial position, past experience and other factors. The utilization of credit limits is regularly monitored.

• III. The Group manages its credit risk, whereby if the contract payments are past due over 30 days based on the terms, there has been a significant increase in credit risk on that

~45~

instrument since initial recognition and the impairment is assessed when the contract payments are past due over certain days.

• IV. The Group wrote-off the financial assets, which cannot be reasonably expected to be recovered after initiating recourse procedures. However, the Group will continue executing the recourse procedures to secure their rights. As of March 31, 2021, December 31, 2020 and March 31, 2020, the Group’s written-off financial assets that are still under recourse procedures amounted to $3,878, $3,078, and $672, respectively.

• V. The Group classifies customers’ accounts receivable in accordance with the credit rating of customers and credit risk on trade. The Group applies the simplified approach using the provision matrix and the forecast ability to adjust historical and timely information to estimate expected credit loss. The expected credit loss ranges from 0.03% to 100%. Movements in relation to the Group applying the simplified approach to provide loss allowance for accounts receivable are as follows:

		For the three-monthperiods ended March 31,	For the three-monthperiods ended March 31,	For the three-monthperiods ended March 31,
		2021		2020
		Accounts receivable		Accounts receivable
At January 1	$	26,070	$	25,914
Provision for impairment	(	2,458)		1,021
Write-offs	(	800)	(	6)
Effect of foreign exchange	(	407)	(	327)
At March 31	$	22,405	$	26,602

(c) Liquidity risk

• I. Cash flow forecasting is performed in the operating entities of the Group and aggregated by Group treasury. Group treasury monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Group does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities.

• II. Surplus cash held by the operating entities over and above balance required for working capital management are transferred to the Group treasury. Group treasury invests surplus cash in interest bearing current accounts, time deposits and marketable securities, choosing instruments with appropriate maturities or sufficient liquidity to provide sufficient headroom as determined by the abovementioned forecasts. The Group is expected to readily generate cash inflows for managing liquidity risk.

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III. The Group has the following undrawn borrowing facilities:

March31,2021 December31,2020 Floating rate: Expiring within one year 3,000,440 $ 1,183,578 $ Expiring beyond one year 2,900,000 2,600,000 5,900,440 $ 3,783,578 $	March31,2020 1,225,452 $ 4,247,000 5,472,452 $

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

March 31, 2021 Non-derivative financial liabilities: Short-term borrowings Notes payable Accounts payable Other payables Lease liability Long-term borrowings (including current portion) December31,2020 Non-derivative financial liabilities: Short-term borrowings Notes payable Accounts payable Other payables Lease liability Long-term borrowings (including current portion)	Less than 1year 294,799 $ 96,698 48,620 260,721 7,539 109,114 Less than 1year 379,605 $ 77,992 49,211 110,835 7,539 103,093	Between 1 and 2years - $ - - - 7,539 58,279 Between 1 and 2years - $ - - - 7,539 114,668	Between 2 and5 years - $ - - - 22,618 297,030 Between 2 and5 years - $ - - - 22,618 323,366	More than 5 years
				- $ - - - 118,745 163,940 More than 5 years
				- $ - - - 120,629 108,173

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Between 1 Between 2 More than
March 31, 2020 Less than 1 year and 2 years and 5 years 5 years
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March31,2020	Less	than 1year	an	d 2years	an	d5 years		5 years
Non-derivative financial
liabilities:
Short-term borrowings	$	526,155	$	-	$	-	$	-
Short-term notes and
bills payable		30,023		-		-		-
Notes payable		79,377		-		-		-
Accounts payable		47,577		-		-		-
Other payables		179,201		-		-		-
Lease liability		7,539		7,539		22,618		126,285
Long-term borrowings
(including current
portion)		82,479		106,413		198,814		-

• V. The Group does not expect the timing of occurrence of the cash flows estimated through the maturity date analysis will be significantly earlier, nor expect the actual cash flow amount will be significantly different.

(3) Fair value information

• A. As of March 31, 2021, December 31, 2020 and March 31, 2020, the Group had no fair value financial instruments.

• B. Financial instruments not measured at fair value

The carrying amounts of the Group’s financial instruments not measured at fair value (including cash and cash equivalents, financial assets at amortized cost - current, notes receivable, accounts receivable, other receivables, guarantee deposits paid, short-term borrowings, short-term notes and bills payable, notes payable, accounts payable, other payables, lease liabilities (current and non-current) and long-term borrowings (including current portion) are approximate to their fair values.

(4) Others

As a cross-border operating group, due to the impact of COVID-19 pandemic, certain nations have taken prevention measures, which have reduced business activities and affected the sales of some operating entities of the Group in certain countries. The Group has taken relevant countermeasures, such as keeping in close contact with customers and manufacturers, strengthening employee health monitoring and continuing to pay attention to the development of the epidemic, in order to mitigate the impact on the operations. However, the actual extent of the possible impact will depend on the subsequent development of the pandemic.

13. SUPPLEMENTARY DISCLOSURES

(According to the regulatory requirement, only information for the three-month period ended March 31, 2021 is disclosed.)

(1) Significant transactions information

• A. Loans to others: None.

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• B. Provision of endorsements and guarantees to others: Please refer to table 1.

• C. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures): None.

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

• E. Acquisition of real estate reaching $300 million or 20% of paid-in capital or more: Please refer to table 2.

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

• G. Purchases or sales of goods from or to related parties reaching $100 million or 20% of paid-in capital or more: None.

• H. Receivables from related parties reaching $100 million or 20% of paid-in capital or more: None.

• I. Trading in derivative instruments undertaken during the reporting period: None.

• J. Significant inter-company transactions during the reporting period: Please refer to table 3.

• (2) Information on investees

Names, locations and other information of investee companies (not including investees in Mainland China): Please refer to table 4.

• (3) Information on investments in Mainland China

• A. Basic information: Please refer to table 5.

• B. Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area: Please refer to table 6.

• (4) Major shareholders information

Major shareholders information: Please refer to table 7.

14. SEGMENT INFORMATION

(1) General information

The management of the Group has identified the operating segments based on how the Group’s chief operating decision maker regularly reviews information in order to make decisions.

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(2) Information about segment profit or loss, assets and liabilities

The segment information provided to the chief operating decision-maker for the reportable segments is as follows:

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For the three-month period ended March 31, 2021
CHIEFTEK Chieftek
PRECISION (Kunshan) cpc Europa cpc USA Others Total
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	CHIEFTEK Chieftek PRECISION (Kunshan) cpcEuropa cpc USA Others Total Forthe three-monthperiod endedMarch31,2021	CHIEFTEK Chieftek PRECISION (Kunshan) cpcEuropa cpc USA Others Total Forthe three-monthperiod endedMarch31,2021	CHIEFTEK Chieftek PRECISION (Kunshan) cpcEuropa cpc USA Others Total Forthe three-monthperiod endedMarch31,2021	CHIEFTEK Chieftek PRECISION (Kunshan) cpcEuropa cpc USA Others Total Forthe three-monthperiod endedMarch31,2021	CHIEFTEK Chieftek PRECISION (Kunshan) cpcEuropa cpc USA Others Total Forthe three-monthperiod endedMarch31,2021
Segment revenue Inter-segment revenue External revenue Interest income Depreciation and amortization Capital expenditures Interest expense Segment pre-tax income Segment assets Segment liabilities Segment revenue Inter-segment revenue External revenue Interest income Depreciation and amortization Capital expenditures Interest expense Segment pre-tax income Segment assets Segment liabilities	301,004 $ 111,242 $ 81,630 $ 47,292 $ 2,532 $ 543,700 $ 122,514 - - - 2,532 125,046 178,490 111,242 81,630 47,292 - 418,654 9 185 - 32 14 240 21,271 95 518 111 761 22,756 48,245 - 78 58 - 48,381 3,056 - 41 - 602 3,699 80,787 21,092 8,485 10,379 34) ( 120,709 2,775,210 263,937 115,944 122,839 250,357 3,528,287 1,356,622 11,536 18,185 1,131 85,259 1,472,733 Forthe three-monthperiod endedMarch31,2020
	CHIEFTEK PRECISION 217,211 $ 95,607 121,604 41 20,443 128,208 3,433 53,379 2,738,635 1,262,370	Chieftek (Kunshan) 66,268 $ - 66,268 335 98 - - 7,032 293,249 6,422	cpcEuropa 68,416 $ 15 68,401 - 658 68 147 5,444 114,515 44,993	cpc USA Others 34,217 $ 3,091 $ - 3,091 34,217 - 113 55 165 830 626 - - 1,306 2,061 1,479) ( 92,038 205,377 714 85,825	Total
					389,203 $ 98,713 290,490 544 22,194 128,902 4,886 66,437 3,443,814 1,400,324

~50~

(3) Reconciliation for segment income

Sales between segments are carried out at arm’s length. The revenue from external customers reported to the chief operating decision-maker is measured in a manner consistent with that in the statement of comprehensive income. A reconciliation of reportable segments pre-tax income to profit before income tax from continuing operations is provided as follows:

			For the three-month periods	For the three-month periods	For the three-month periods	ended March 31,
			2021			2020
Reportable segments pre-tax income		$	120,743		$	67,916
Other segments pre-tax loss	(		34)	(		1,479)
Inter segments gain	(		32,898)	(		13,328)
Profit before income tax		$	87,811		$	53,109

~51~

Table 1

Expressed in thousands of NTD

CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES Provision of endorsements and guarantees to others

For the three-month period ended March 31, 2021

Nunber (Note 1)	Endorser/ guarantor	Party being endorsed/guaranteed	Party being endorsed/guaranteed	Limit on endorsements/ guarantees provided for a single party (Note 3)	Maximum outstanding endorsement/ guarantee amount as of March 31, 2021	Outstanding endorsement/ guarantee amount at March 31, 2021	Actual amount drawn down	Amount of endorsements/ guarantees secured with collateral	Ratio of accumulated endorsement/ guarantee amount to net asset value of the endorser/ guarantor company	Ceiling on total amount of endorsements/ guarantees provided (Note 3)	Provision of endorsements/ guarantees by parent company to subsidiary	Provision of endorsements/ guarantees by subsidiary to parent company	Provision of endorsements/ guarantees to the party in Mainland China	Footnote
		Companyname	Relationship with the endorser/ guarantor （Note 2）
0	CHIEFTEK PRECISION CO., LTD.	cpc Europa GmbH	1	1,027,777 $	157,590 $	100,440 $	- $	- $	5%	1,027,777 $	Y	N	N	－

(Note 1) The numbers filled in for the transaction company in respect of inter-company transactions are as follows:

(1) Parent company is ‘0’.

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

(Note 2) The following code respresents the relationship with the Company:

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

(Note 3) (1) The total endorsements/guarantees provided shall not exceed 50% of the Companyʼs net assets, and the amount provided for each counterparty shall not exceed 20% of the Companyʼs paid-in capital. However, the limitation is not applied to subsidiaries that the Company directly or indirectly holds more than 50% of the voting shares.

(2) For trading partner, except for the abovementioned limit, the maximum amount for individual trading partner shall not exceed the higher of total purchase and sale transations during the most recent year.

Table 1, Page 1

Expressed in thousands of NTD

CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES

• Acquisition of real estate reaching NT$300 million or 20% of paid in capital or more For the three-month period ended March 31, 2021

Table 2

If the counterparty is a related party, information as to the last transaction of the real estate is disclosed below:

Real estate acquired by	Real estate acquired	Date of the event	Transaction amount	Status of payment	Counterparty	Relationship with the counterparty	Original owner who sold the real estate to the counterparty	Relationship between the original owner and the acquirer	Date of the original transaction	Amount	Basis or reference used in setting the price	Reason for acquisition of real estate and status of the real estate	Other commitments
CHIEFTEK PRECISION CO., LTD.	Sugu new factory construction phase II	May 17, 2019	$ 454,419	$ 351,686	Hong Sheng Construction Corp.	－	－	－	－	$ -	Negotiation	Building for operation use	－

Table 2, Page 1

• Significant inter company transactions during the reporting period

For the three-month period ended March 31, 2021

Table 3

Expressed in thousands of NTD

CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES

Number (Note1)	Companyname	Counterparty	Relationship (Note2)		Transaction	Transaction
				General ledgeraccount	Amount	Transactionterms	Percentage of consolidated total operating revenues or totalassets (Note 3)
0 1 2	CHIEFTEK PRECISION CO., LTD. CHIEFTEK PRECISION HOLDING CO., LTD. CHIEFTEK PRECISION USA CO., LTD.	cpc Europa GmbH CHIEFTEK PRECISION USA CO., LTD. Chieftek Machinery (Kunshan) Co., Ltd. CHIEFTEK PRECISION USA CO., LTD. CHIEFTEK PRECISION INTERNATINAL LLC	1 1 1 3 3	Sales revenue Accounts receivable Endorsements and guarantees Sales revenue Accounts receivable Sales revenue Accounts receivable Dividends receivable Rent payment Refundable deposits	($ 43,235) 80,962 100,440 ( 22,497) 52,074 ( 56,782) 48,396 26,958 2,532 1,427	180 days after monthly- closing, T/T － － 180 days after monthly- closing, T/T － 180 days after monthly- closing, T/T － － － －	(10%) 2% 3% (5%) 1% (14%) 1% 1% 1% －

(Note 1) The numbers filled in for the transaction company in respect of inter-company transactions are as follows:

(1) Parent company is ‘0’.

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

(Note 2) Relationship between transaction company and counterparty is classified into the following three categories:

(1) Parent company to subsidiary.

(2) Subsidiary to parent company.

(3) Subsidiary to subsidiary.

(Note 3) Regarding percentage of transaction amount to consolidated total operating revenues or total assets, it is computed based on period-end balance of transaction to consolidated total assets for balance sheet accounts and based on accumulated transaction amount for the period to consolidated total operating revenues for income statement accounts.

(Note 4) Only transactions over 1 million are disclosed.

(Note 5) Foreign currencies were translated into New Taiwan Dollars using the exchange rate (USD:NTD 1:28.535) as of March 31, 2021.

Table 3, Page 1

CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES Names, locations and other information of investee companies (not including investees in Mainland China) For the three-month period ended March 31, 2021

Table 4

Expressed in thousands of NTD

Investor	Investee	Location	Main business activities	Initial investment amount	Initial investment amount	Shares held as of March31,2021	Shares held as of March31,2021	Shares held as of March31,2021	Net profit (loss) of the investee for the three-month period ended March31,2021	Investment income (loss) recognized by the Company for the three-month period ended March31,2021	Footnote
				Balance as of March31,2021	Balance as of December31,2020	Number of shares	Ownership (%)	Bookvalue
CHIEFTEK PRECISION CO., LTD. CHIEFTEK PRECISION HOLDING CO., LTD.	CHIEFTEK PRECISION HOLDING CO., LTD. CHIEFTEK PRECISION INTERNATIONAL LLC CHIEFTEK PRECISION USA CO., LTD. cpc Europa GmbH Chieftek Precision (Hong Kong) Co., Limited	Samoa United States of America United States of America Germany Hong Kong	Professional investment Lease of real estate property Sale of high precision linear motion components and rendering after -sale services Sale of high precision linear motion components and rendering after -sale services Professional investment	152,263 $ 110,054 50,027 98,695 145,529	152,263 $ 110,054 50,027 98,695 145,529	5,100,000 - 1,660,000 - 5,100,000	100 100 100 100 100	292,923 $ 101,755 44,012 17,215 270,065	14,032 $ 34) ( 10,415 8,485 14,113	14,032 $ 34) ( 10,415 8,485 -	Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary (Note 1)

(Note 1) Not required to disclose income (loss) recognized by the Company.

(Note 2) Foreign currencies were translated into New Taiwan Dollars using the exchange rate (USD:NTD 1:28.535) as of March 31, 2021.

Table 4, Page 1

Expressed in thousands of NTD

CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES

Information on investments in Mainland China - Basic information

For the three-month period ended March 31, 2021

Table 5

Amount remitted from Taiwan to Investment Mainland China/ income Accumulated Accumulated Amount remitted back (loss) recognized amount amount of to Taiwan for the three-month period Accumulated by the Company of investment remittance from ended March 31, 2021 amount Net income of Ownership for the threeBook value of income Taiwan to of remittance from investee for the held by month investments in remitted back to Mainland China Taiwan to three-month the Company period ended Mainland China Taiwan as of Investee in Mainland Main business Investment as of January 1, Remitted to Remitted back to Mainland China as period ended (direct or March 31, 2021 as of March 31, March 31, China activities Paid-in capital method 2021 Mainland China Taiwan of March 31, 2021 March 31, 2021 indirect) （Note 2） 2021 2021 Footnote Chieftek Machinery Production, $ 145,529 Note 1 $ 145,529 $ - $ - $ 145,529 $ 14,113 100% $ 14,113 $ 219,594 $ 121,770 － (Kunshan) Co., Ltd processing and sale of high precision linear motion components and rendering after-sale services

Companyname	Accumulated amount of remittance from Taiwan to Mainland China as of March 31,2021	Investment amount approved by the Investment Commission of the Ministry of Economic Affairs (MOEA)	Ceiling on investments in Mainland China imposed by the Investment Commission of MOEA(Note 3)
CHIEFTEK PRECISION CO., LTD.	$ 145,529	$ 145,529	$ 1,233,332

(Note 1) Through investing in an existing company in the third area (Chieftek Precision (Hong Kong) Co., Ltd.) which then invested in the investee in Mainland China.

(Note 2) The investment income (loss) is recognized based on the investeesʼ financial statements that were reviewed by the parent company’s auditors for the three-month period ended March 31, 2021. (Note 3) The ceiling amount is 60% of the higher of net worth or consolidated net worth.

(Note 4) Foreign currencies were translated into New Taiwan Dollars using the exchange rate (USD:NTD 1:28.535) as of March 31, 2021.

Table 5, Page 1

Table 6

CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES

Information on investments in Mainland China - Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area For the three-month period ended March 31, 2021

Expressed in thousands of NTD

Investee in MainlandChina	Sales(purchase)	Sales(purchase)	Propertytransaction	Propertytransaction	Accounts receivable	(payable)	Provision of endorsements/guarantees or collaterals	Provision of endorsements/guarantees or collaterals		Financing	Financing		Others
	Amount	%	Amount	%	Balance at March 31, 2021	%	Balance at March 31, 2021	Purpose	Maximum balance during the three-month period ended March31,2021	Balance at March 31, 2021	Interest rate	Interest during the three-month period ended March31,2021
Chieftek Machinery (Kunshan) Co., Ltd	$ 56,782	19%	$ -	-	$ 48,396	13%	$ -	-	$ -	- $	-	- $	- $

Table 6, Page 1

CHIEFTEK PRECISION CO., LTD. AND SUBSIDIARIES

Major shareholders information

March 31, 2021

Table 7

Expressed in share

Name of the major shareholder	Number	of shares
	Common stock	Ownership (%)
Hsu, Ming-Che Fubon Life Insurance Co., Ltd.	5,579,338 4,652,900	6.87% 5.73%

Note: The major shareholders information was derived from the data that the Company issued common shares (including treasury shares) and preference shares in dematerialised form which were registered and held by the shareholders above 5% on the last operating date of each quarter and was calculated by Taiwan Depository & Clearing Corporation. The share capital which was recorded in the financial statements is different from the actual number of shares issued in dematerialised form because of the different calculation basis.

Table 7, Page 1