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DFI Inc. — Audit Report / Information 2025
Apr 7, 2026
52054_rns_2026-04-07_787f0ff6-74e8-4210-90cd-1690179f6ca5.pdf
Audit Report / Information
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Stock Code: 2397
DFI Inc.
Parent Company Only Financial Statements and Independent Auditors' Report
For the years ended December 31, 2025 and 2024
This is the translation of the financial statements. CPAs do not audit on this translation
Company Address: 10F, No. 97, Sec. 1, Xintai 5th Rd., Xizhi Dist., New Taipei City
Telephone: (02) 26972986
The independent auditors' report and the accompanying financial statements are the English translation of the Chinese version prepared and used in the Republic of China. The translation is not prepared by the independent auditor. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors' report and financial statements, the Chinese version shall prevail.
~1~
Table of Contents
| Item | Page |
|---|---|
| A. Cover | 1 |
| B. Table of Contents | 2 |
| C. Independent Auditors' Report | 3 |
| D. Balance Sheets | 4 |
| E. Statement of Comprehensive Income | 5 |
| F. Statement of Changes in Equity | 6 |
| G. Statements of Cash Flows | 7 |
| H. Notes to Parent Company Only Financial Statements | |
| I. Company History | 8 |
| II. Date and Procedures for Approval of Financial Statements | 8 |
| III. Application of Newly Issued and Revised Standards and Interpretations | 8-10 |
| IV. Summary of Significant Accounting Policies | 10-26 |
| V. Major Sources of Uncertainty in Significant Accounting Judgments, Estimates and Assumptions | 26-27 |
| VI. Description of Significant Accounting Items | 27-60 |
| VII. Related Party Transactions | 60-65 |
| VIII. Pledged Assets | 65 |
| IX. Significant Contingent Liabilities and Unrecognized Contract Commitments | 65 |
| X. Significant Disaster Losses | 65 |
| XI. Significant Events after the Balance Sheet Date | 65 |
| XII. Others | 66 |
| XIII. Supplementary Disclosures | |
| (I) Information on Significant Transactions | 67, 68-70 |
| (II) Reinvestment and Related Information | 67, 71 |
| (III) Information on Investments in Mainland China | 67, 72 |
| XIV. Segment Information | 67 |
| I. Statements of Major Accounting Item | 73-83 |
~2~
Independent Auditors' Report
The Board of Directors and Shareholders DFI Inc.
Audit Opinion
We have reviewed the accompanying balance sheets of DFI Inc. as of December 31, 2025 and 2024, which comprise the comprehensive income statement, statement of changes in equity, and cash flow statement from January 1 to December 31, 2025 and 2024, as well as the notes to the parent company only financial statements (including the summary of significant accounting policies).
In our opinion, based on our audits and the reports of other certified public accountants (see Other Matters section), the aforementioned financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, as well as the Company's financial performance and cash flows from January 1 to December 31 in 2025 and 2024, in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.
Basis for opinion
We conducted audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and Generally Accepted Auditing Standards. Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Parent Company Only Financial Statements section of our report. We are independent of the Company in accordance with the Norm of Professional Ethics for Certified Public Accountant of the Republic of China and we have fulfilled our other ethical responsibilities in accordance with these requirements. Based on our audit results and other certified public accountants' audit reports, we believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Company's parent company only financial statements for the year ended December 31, 2025. These matters were addressed in the context of our audit of the parent company only financial statements as a whole, and in forming our opinion thereon, we do not provide a separate opinion on these matters. Key audit matters that we judge should be communicated in the audit reports are stated as follows:
I. Impairment assessment of goodwill arising from investment in subsidiaries
For accounting policies related to the impairment of non-financial assets, please refer to Note IV (XIV) of the parent company only financial statements; for an explanation on the uncertainty of assumptions and accounting estimates of a goodwill impairment assessment, please refer to Note V of the parent company only financial statements; for an explanation of a goodwill impairment test, please refer to Note VI (VII) of the parent company only financial statements.
~3~
Key audit matters are stated as follows:
The Company’s significant goodwill arising from the acquisition of DFI AMERICA, LLC and Transpak Equipment Corporation was included in the book value of the investment accounted for using the equity method in the parent company only financial statements. The goodwill should be tested for impairment annually, or whenever there is an indication of impairment. Because assessing the recoverable amount of the cash-generating unit to which goodwill has been allocated involves a number of management assumptions and estimates, the goodwill impairment assessment is a material evaluation matter for us when conducting the audit of the Company's parent company only financial report.
The audit procedures to process for the above:
Our audits of the above critical items include: obtaining management’s self-assessment of the DFI AMERICA, LLC.'s and Transpak Equipment Corporation's goodwill impairment test form; evaluating DFI AMERICA, LLC.'s and Transpak Equipment Corporation's reasonableness of the bases of estimates and significant assumptions used by management to determine the recoverable amount, including the discount rate, expected rate of growth in revenues, and projections of future cash flows; compare the previously forecasted future cash flows with actual results to assess the accuracy of past management estimates; performing sensitivity analyses of significant assumptions; and reviewing whether the Company has appropriately disclosed information regarding the goodwill impairment assessment.
Other Matters
Some of the investments in subsidiaries under the equity method included in the Company’s parent company only financial statements were not audited by us, but by other certified public accountants. Therefore, our opinion, insofar as it relates to the amounts included in the financial statements of the subsidiaries, is based on the reports of other certified public accountants. The investment in this subsidiary recognized under the equity method amounted to NT$478,691 thousand and NT$470,216 thousand as of December 31, 2025 and 2024, respectively, representing 7.67% and 7.65% of total assets. The share of profit or loss of subsidiaries recognized under the equity method from January 1 to December 31, 2025 and 2024 were NT$29,795 thousand and NT$16,545 thousand, respectively, which accounted for 8.60% and 3.47% of income before tax, respectively.
Responsibility of Management and Governance Units for Parent Company Only Financial Statements
Management is responsible for the preparation and fair presentation of the parent company only financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and for such internal control as management determines is necessary to enable the preparation of parent company only financial statement that are free from material misstatement, whether due to fraud or error.
In preparing the parent company only financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those charged with governance (including Audit Committee) are responsible for overseeing DFI Inc.'s financial reporting process.
~3-1~
Auditors’ Responsibilities for the Audit of the Parent Company Only Financial Statements
Our objectives are to obtain reasonable assurance regarding whether the parent company only financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the auditing standards generally accepted in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error. If the individual amounts or sums that the material misstatement involved may be reasonably expected to affect the financial decision making of users of the parent company only financial statements, such misstatement will be considered material.
As part of an audit in accordance with the auditing standards generally accepted in the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
I. Identify and assess the risks of material misstatement of the parent company only financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
II. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the DFI Inc.’s internal control.
III. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
IV. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the DFI Inc.’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the parent company only financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause DFI Inc. to cease to continue as a going concern.
V. Evaluate the overall presentation, structure and content of the parent company only financial statements, including the related notes, and whether the parent company only financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
VI. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements of equity-method investees in order to express an opinion on the financial statements. We are responsible for directing, supervising, and performing the audit and for forming an opinion on the financial statements of DFI Inc.
We communicate with the governance body regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
~3-2~
We also provide the governance unit with a statement of independence from the Norm of Professional Ethics for Certified Public Accountant of the Republic of China, which is followed by those who are subject to the independence requirements of the firm to which we belong, and we communicate with the governance unit about all relationships and other matters (including relevant safeguards) that might be perceived as affecting the independence of the accountant.
From the matters communicated with the governance unit, we determine the key audit matters of the Company’s parent company only financial statements for the year ended December 31, 2025. We describe these matters in our certified public accountants’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
KPMG Taiwan
CPA:
Assurance Document Number Approved by Securities Authority
: Jin-Guan-Zheng-Shen-Zi No. 1060005191
(88) Tai-Cai-Zheng (VI) No. 18311
March 3, 2026
Notes to Readers
The accompanying financial statements are intended only to present the financial position, financial performance and cash flows in accordance with the accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such financial statements are those generally accepted and applied in the Republic of China.
The independent auditors’ audit report and the accompanying financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ audit report and financial statements, the Chinese version shall prevail.
~3-3~
DFI Inc.
Balance Sheets
As of December 31, 2025 and 2024
Unit: NT$ thousand
| Assets | 2025.12.31 | 2024.12.31 | |||
|---|---|---|---|---|---|
| Amount | % | Amount | % | ||
| Current assets: | |||||
| 1100 | Cash and cash equivalents (Note VI (I)) | $ 300,623 | 5 | 418,043 | 7 |
| 1110 | Financial assets measured at fair value through profit or loss - current (Notes VI (II)) | 21,007 | - | 22,457 | - |
| 1136 | Financial assets measured at amortized cost - current (Notes VI (IV) & VIII) | 1,500 | - | 1,500 | - |
| 1170 | Net of notes and accounts receivable (Notes VI (V) & (XX)) | 254,827 | 4 | 306,775 | 5 |
| 1180 | Accounts receivable - related parties (Notes VI (V), (XX) and VII) | 246,742 | 4 | 293,886 | 5 |
| 1200 | Other receivables (Notes VI (V) & VII) | 17,818 | - | 26,082 | 1 |
| 130X | Inventories (Notes VI (VI)) | 787,282 | 13 | 477,050 | 8 |
| 1410 | Prepayments | 36,002 | 1 | 23,275 | - |
| 1470 | Other current assets | 1,330 | - | 1,200 | - |
| Total current assets | 1,667,131 | 27 | 1,570,268 | 26 | |
| Non-current assets: | |||||
| 1510 | Financial assets measured at fair value through profit or loss - non-current (Notes VI (II)) | 20,000 | - | - | - |
| 1550 | Investment under the equity method (Notes VI (III) & (VII)) | 3,526,552 | 57 | 3,507,786 | 57 |
| 1600 | Property, plant and equipment (Note VI (VIII)) | 717,515 | 11 | 765,019 | 12 |
| 1755 | Right-of-use assets (Notes VI (IX) & VII) | 67,873 | 1 | 84,620 | 1 |
| 1760 | Net of investment properties (Note VI (X)) | 173,090 | 3 | 174,881 | 3 |
| 1780 | Intangible assets (Notes VI (VII), (XI) & VII) | 4,782 | - | 9,303 | - |
| 1840 | Deferred income tax assets (Notes VI (XVII)) | 29,425 | - | 36,773 | 1 |
| 1990 | Other non-current assets | 32,694 | 1 | 1,043 | - |
| Total non-current assets | 4,571,931 | 73 | 4,579,425 | 74 | |
| Total assets | $ 6,239,062 | 100 | 6,149,693 | 100 |
(Please read the accompanying notes to the parent company only financial statements)
Chairman: Chen Chi-Hong
President: Tien Chih-Yin
Accounting Supervisor: Huang Li-Min
DFI Inc.
Balance Sheets (Continued from the previous page)
As of December 31, 2025 and 2024
Unit: NT$ thousand
| Liabilities and equity | 2025.12.31 | 2024.12.31 | |||
|---|---|---|---|---|---|
| Amount | % | Amount | % | ||
| Current liabilities: | |||||
| 2100 | Short-term borrowings (Notes VI (XII)) | $ 680,000 | 11 | 1,000,000 | 16 |
| 2120 | Financial liabilities measured at fair value through profit or loss | ||||
| - current (Note VI (II)) | 1,160 | - | 3,751 | - | |
| 2130 | Contract liabilities - current (Note VI (XX)) | 19,420 | - | 12,090 | - |
| 2170 | Accounts payables | 712,007 | 12 | 551,860 | 9 |
| 2180 | Accounts payables to related parties (Note VII) | 40,734 | 1 | 58,131 | 1 |
| 2200 | Other payables (Note VI (XXI) & VII) | 210,761 | 4 | 208,456 | 4 |
| 2230 | Current income tax liabilities | 17,596 | - | 3,732 | - |
| 2250 | Provisions - current (Note VI (XV)) | 23,192 | - | 30,437 | 1 |
| 2280 | Lease liabilities - current (Note VI (XIV) & VII) | 14,101 | - | 17,166 | - |
| 2322 | Long-term borrowings - current portion (Note VI (XIII)) | 320,000 | 5 | 80,000 | 1 |
| 2399 | Other current liabilities | 6,102 | - | 6,012 | - |
| Total current liabilities | 2,045,073 | 33 | 1,971,635 | 32 | |
| Non-current liabilities: | |||||
| 2540 | Long-term borrowings (Notes VI (XIII)) | 600,000 | 9 | 470,000 | 8 |
| 2570 | Deferred income tax liabilities (Notes VI (XVII)) | 118,037 | 2 | 109,039 | 2 |
| 2580 | Lease liabilities - non-current (Note VI (XIV) & VII) | 58,016 | 1 | 72,118 | 1 |
| 2640 | Net defined benefit liabilities - non-current (Note VI (XVI)) | 15,025 | - | 15,159 | - |
| Total non-current liabilities | 791,078 | 12 | 666,316 | 11 | |
| Total liabilities | 2,836,151 | 45 | 2,637,951 | 43 | |
| Equity (Notes VI (III), (VII) and (XVIII)): | |||||
| 3110 | Share capital - Ordinary shares | 1,144,889 | 18 | 1,144,889 | 19 |
| 3200 | Capital surplus | 898,872 | 15 | 898,131 | 14 |
| 3300 | Retained earnings | 1,432,841 | 23 | 1,538,288 | 25 |
| 3400 | Other equity | (73,691) | (1) | (69,566) | (1) |
| Total equity | 3,402,911 | 55 | 3,511,742 | 57 | |
| Total liabilities and equity | $ 6,239,062 | 100 | 6,149,693 | 100 |
(Please read the accompanying notes to the parent company only financial statements)
Chairman: Chen Chi-Hong
President: Tien Chih-Yin
Accounting Supervisor: Huang Li-Min
DFI Inc.
Statement of Comprehensive Income
From January 1 to December 31, 2025 and 2024
Unit: NT$ thousand
| 2025 | 2024 | ||||
|---|---|---|---|---|---|
| Amount | % | Amount | % | ||
| 4000 | Net operating revenue (Notes VI (XX) and VII) | $ 3,760,516 | 100 | 3,222,248 | 100 |
| 5000 | Operating costs (Note VI (VI), (VIII), (IX), (XI), (XIV), (XV), (XVI), (XXI), VII & XII) | (2,879,897) | (77) | (2,365,100) | (74) |
| Gross Profit | 880,619 | 23 | 857,148 | 26 | |
| 5910 | Gain on realized (unrealized) sales | (13,432) | - | 49,770 | 2 |
| Gross Profit | 867,187 | 23 | 906,918 | 28 | |
| Operating expenses (Note VI (V), (VIII), (IX), (X), (XI), (XIV), (XVI), (XXI), VII & XII): | |||||
| 6100 | Selling and marketing expenses | (207,147) | (6) | (187,233) | (6) |
| 6200 | General and administrative expenses | (116,607) | (3) | (112,764) | (3) |
| 6300 | Research and development expenses | (292,500) | (7) | (281,775) | (9) |
| 6450 | Expected credit (impairment loss) gain on reversal | (1,873) | - | 242 | - |
| 6000 | Total operating expenses | (618,127) | (16) | (581,530) | (18) |
| Net operating income | 249,060 | 7 | 325,388 | 10 | |
| Non-operating income and expenses (Notes VI (VII), (XIV), (XXII) & VII) | |||||
| 7100 | Interest income | 6,517 | - | 7,482 | - |
| 7010 | Other income | 18,711 | - | 27,362 | 1 |
| 7020 | Other gains and losses | (1,964) | - | (30,994) | (1) |
| 7050 | Finance costs | (28,957) | (1) | (22,786) | (1) |
| 7070 | Share of profit or loss from subsidiary and associates recognized using the equity method | 103,425 | 3 | 170,050 | 5 |
| Total non-operating income and expenses | 97,732 | 2 | 151,114 | 4 | |
| 7900 | Net profit before tax | 346,792 | 9 | 476,502 | 14 |
| 7950 | Less: Income tax expense (Note VI (XVII)) | (61,427) | (2) | (79,891) | (2) |
| 8200 | Net profit for the period | 285,365 | 7 | 396,611 | 12 |
| Other comprehensive income (Note VI (XVI), (XVII) and (XVIII)): | |||||
| 8310 | Items that will not be reclassified to profit or loss | ||||
| 8311 | Remeasurement of defined benefit plans | (2,096) | - | 1,756 | - |
| 8316 | Unrealized gain (loss) on investments in equity instruments at fair value through other comprehensive income | - | - | (1,419) | - |
| 8330 | Shares of other comprehensive income of subsidiary and associates accounted for using the equity method | (5,066) | - | 1,637 | - |
| 8349 | Income tax relating to items that will not be reclassified | 419 | - | (351) | - |
| (6,743) | - | 1,623 | - | ||
| 8360 | Items that may be reclassified subsequently to profit or loss | ||||
| 8361 | Exchange differences on translating the financial statements of foreign operations | 1,068 | - | 26,356 | 1 |
| 8399 | Income tax relating to items that may be reclassified | - | - | - | - |
| 1,068 | - | 26,356 | 1 | ||
| Other comprehensive income (loss) for the period | (5,675) | - | 27,979 | 1 | |
| 8500 | Total comprehensive income (loss) for the period | $ 279,690 | 7 | 424,590 | 13 |
| Earnings per Share (Unit: NT$, Note VI (XIX)) | |||||
| 9750 | Basic earnings per share | $ | 2.49 | 3.46 | |
| 9850 | Diluted earnings per share | $ | 2.48 | 3.45 |
(Please read the accompanying notes to the parent company only financial statements)
Chairman: Chen Chi-Hong
President: Tien Chih-Yin
Accounting Supervisor: Huang Li-Min
DFI Inc.
Statement of Changes in Equity
From January 1 to December 31, 2025 and 2024
Unit: NT$ thousand
Balance as of January 1, 2024
Net profit for the period
Other comprehensive income (loss) for the period
Total comprehensive income (loss) for the period
Profit distribution:
Legal reserve
Special reserve
Cash dividends for common shares
Changes in percentage of ownership interests in subsidiaries
Differences between the actual price for acquisition or disposal of the subsidiaries and their carrying amount
Disposal of equity instruments measured at fair value through other comprehensive income
Disposition of unearned funds of employee stock ownership trust
Balance as of December 31, 2024
Net profit for the period
Other comprehensive income (loss) for the period
Total comprehensive income (loss) for the period
Profit distribution:
Legal reserve
Special reserve
Cash dividends for common shares
Changes in percentage of ownership interests in subsidiaries
Disposition of unearned funds of employee stock ownership trust
Balance as of December 31, 2025
| Share capital - Ordinary shares | Capital surplus | Retained earnings | Exchange differences on translating the financial statements of foreign operations | Unrealized gain (loss) on financial assets at fair value through other comprehensive income | Total | Total equity | |||
|---|---|---|---|---|---|---|---|---|---|
| Legal reserve | Special reserve | Undistributed earnings | Total | ||||||
| $ 1,144,889 | 629,767 | 924,057 | 38,040 | 481,074 | 1,443,171 | (97,599) | 41,808 | (55,791) | 3,162,036 |
| - | - | - | - | 396,611 | 396,611 | - | - | - | 396,611 |
| - | - | - | - | 3,326 | 3,326 | 26,356 | (1,703) | 24,653 | 27,979 |
| - | - | - | - | 399,937 | 399,937 | 26,356 | (1,703) | 24,653 | 424,590 |
| - | - | 36,913 | - | (36,913) | - | - | - | - | - |
| - | - | - | 17,750 | (17,750) | - | - | - | - | - |
| - | - | - | - | (343,467) | (343,467) | - | - | - | (343,467) |
| - | 84,571 | - | - | - | - | - | - | - | 84,571 |
| - | 183,410 | - | - | - | - | 268 | (49) | 219 | 183,629 |
| - | - | - | - | 38,647 | 38,647 | - | (38,647) | (38,647) | - |
| - | 383 | - | - | - | - | - | - | - | 383 |
| 1,144,889 | 898,131 | 960,970 | 55,790 | 521,528 | 1,538,288 | (70,975) | 1,409 | (69,566) | 3,511,742 |
| - | - | - | - | 285,365 | 285,365 | - | - | - | 285,365 |
| - | - | - | - | (1,550) | (1,550) | 1,068 | (5,193) | (4,125) | (5,675) |
| - | - | - | - | 283,815 | 283,815 | 1,068 | (5,193) | (4,125) | 279,690 |
| - | - | 43,858 | - | (43,858) | - | - | - | - | - |
| - | - | - | 13,775 | (13,775) | - | - | - | - | - |
| - | - | - | - | (389,262) | (389,262) | - | - | - | (389,262) |
| - | 171 | - | - | - | - | - | - | - | 171 |
| - | 570 | - | - | - | - | - | - | - | 570 |
| $ 1,144,889 | 898,872 | 1,004,828 | 69,565 | 358,448 | 1,432,841 | (69,907) | (3,784) | (73,691) | 3,402,911 |
(Please read the accompanying notes to the parent company only financial statements)
Chairman: Chen Chi-Hong
President: Tien Chih-Yin
Accounting Supervisor: Huang Li-Min
DFI Inc.
Statements of Cash Flows
From January 1 to December 31, 2025 and 2024
Unit: NT$ thousand
| 2025 | 2024 | |
|---|---|---|
| Cash flows from operating activities: | ||
| Net profit before tax for the period | $ 346,792 | 476,502 |
| Adjustment item: | ||
| Adjustments for | ||
| Depreciation expense | 81,101 | 87,554 |
| Amortization expense | 5,729 | 6,518 |
| Expected credit (impairment loss) gain on reversal | 1,873 | (242) |
| Evaluation losses of financial assets measured at fair value through profit or losses | 1,370 | 2,350 |
| Interest expense | 28,957 | 22,786 |
| Interest income | (6,517) | (7,482) |
| Dividend income | - | (4,555) |
| Shares of profit of subsidiaries accounted for using the equity method | (103,425) | (170,050) |
| Loss (gain) on disposal of property, plant and equipment | (170) | 88 |
| Unrealized loss (gain) on sales | 13,432 | (49,770) |
| Total revenue, expense and loss items | 22,350 | (112,803) |
| Changes in assets/liabilities related to business activities: | ||
| Net changes in assets related to operating activities: | ||
| Financial assets mandatorily classified as at fair value through profit or loss | 80 | 7,810 |
| Notes and accounts receivable | 50,075 | (14,535) |
| Accounts receivable - related parties | 47,144 | (147,965) |
| Other receivables | 8,262 | (17,883) |
| Inventories | (310,232) | (39,956) |
| Prepayments | (12,727) | (22) |
| Other current assets | (130) | (898) |
| Total net changes in assets related to operating activities | (217,528) | (213,449) |
| Net change in liabilities related to operating activities: | ||
| Financial liabilities held for trading | (2,591) | 3,616 |
| Contract liabilities | 7,330 | 1,358 |
| Accounts payables | 160,147 | 206,795 |
| Accounts payable - related parties | (17,397) | 46,531 |
| Other payables | (3,577) | 43,291 |
| Provisions | (7,245) | (11,327) |
| Other current liabilities | 90 | (12,052) |
| Net defined benefit liabilities | (2,230) | (2,213) |
| Total net changes in liabilities related to business activities | 134,527 | 275,999 |
| Total net changes in assets and liabilities related to operating activities | (83,001) | 62,550 |
| Total adjustment items | (60,651) | (50,253) |
| Cash generated from operations | 286,141 | 426,249 |
| Interest received | 6,519 | 7,484 |
| Interest paid | (29,271) | (21,657) |
| Income tax paid | (30,798) | (132,866) |
| Net cash inflows from operating activities | 232,591 | 279,210 |
(Continued on the next page)
(Please read the accompanying notes to the parent company only financial statements)
Chairman: Chen Chi-Hong
President: Tien Chih-Yin
Accounting Supervisor: Huang Li-Min
DFI Inc.
Statements of Cash Flows (Continued from the previous page)
From January 1 to December 31, 2025 and 2024
Unit: NT$ thousand
| 2025 | 2024 | |
|---|---|---|
| Cash flows from investing activities: | ||
| Purchase of financial assets at fair value through other comprehensive income | - | (41,692) |
| Acquisition of financial assets measured at fair value through profit or loss | (20,000) | - |
| Acquisition of investments accounted for using the equity method | - | (715,357) |
| Refund of share capital due to capital decrease of subsidiaries accounted for using the equity method | - | 78,804 |
| Purchase of property, plant and equipment | (8,711) | (5,989) |
| Proceeds from disposal of property, plant and equipment | 170 | 981 |
| Purchase of intangible assets | (1,208) | (6,577) |
| Decrease (increase) in other non-current assets | (31,803) | 969 |
| Dividends received | 67,400 | 31,374 |
| Net cash inflows (outflows) from investing activities | 5,848 | (657,487) |
| Cash flows from financing activities: | ||
| Proceeds from short-term borrowings | 4,450,000 | 3,750,000 |
| Repayments of short-term borrowings | (4,770,000) | (3,400,000) |
| Proceeds from long-term borrowings | 750,000 | 150,000 |
| Repayments of long-term borrowings | (380,000) | - |
| Repayment of the principal portion of lease | (17,167) | (18,566) |
| Cash dividends distributed | (389,262) | (343,467) |
| Disposal of subsidiary shares (without loss of control) | - | 214,138 |
| Disposition of unearned funds of employee stock ownership trust | 570 | 383 |
| Net cash (used in) generated from financing activities | (355,859) | 352,488 |
| Decrease in cash and cash equivalents for the current period | (117,420) | (25,789) |
| Cash and cash equivalents at the beginning of the period | 418,043 | 443,832 |
| Cash and cash equivalents at the end of the period | $ 300,623 | 418,043 |
(Please read the accompanying notes to the parent company only financial statements)
Chairman: Chen Chi-Hong
President: Tien Chih-Yin
Accounting Supervisor: Huang Li-Min
DFI Inc.
Notes to Parent Company Only Financial Statements
For the years ended December 31, 2025 and 2024
(The amount shall be dominated in thousands of NT$, unless otherwise specified)
I. Company History
On July 14, 1981, DFI Inc. (the “Company”) was established and registered under the approval from the Ministry of Economic Affairs, having the registered address of 10F, No. 97, Sec. 1, Xintai 5th Rd., Xizhi Dist., New Taipei City. The Company is principally engaged in the manufacturing and sales of boards and computer components for industrial computers.
II. Date and Procedures for Approval of Financial Statements
The accompanying parent company only financial statements were approved and issued by the Board of Directors on March 3, 2026.
III. Application of Newly Issued and Revised Standards and Interpretations
(I) Effect of adopting new and amended standards and interpretations endorsed by the Financial Supervisory Commission
As of January 1, 2025, the Company began to apply the following newly revised International Financial Reporting Standards (IFRS), which has not had a significant impact on the parent company only financial statements.
- Amendments to IAS 21 "Lack of Exchangeability"
(II) Impact of not yet adopting IFRSs endorsed by the FSC
The Company assessed that the application of the following newly revised IFRSs, effective January 1, 2026, would not have a material impact on the parent company only financial statements.
- Amendments to IFRS 17, "Insurance Contracts" and IFRS 17
- Amendments to IFRS 9 and IFRS 7 "Amendments to the Classification and Measurement of Financial Instruments"
- Annual Improvements to IFRSs
- Amendments to IFRS 9 and IFRS 7 "Contracts Referencing Nature-dependent Electricity"
(III) New and amended standards and interpretations not yet endorsed by the FSC
The standards and interpretations issued and amended by the IASB but not yet endorsed by the FSC that may be related to the Company are as follows:
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
| New issued or amended standards | Main amendments | Effective date of issuance by IASB |
|---|---|---|
| IFRS 18 "Presentation and Disclosure of Financial Statements" | The new guidelines introduce three categories of income and expenses, two subtotals on the income statement, and a single footnote regarding management performance measurement. These three amendments and enhancements to the guidance on segmenting information in financial statements lay the foundation for providing users with improved and consistent information, and will have an impact on all companies. |
• A more structured income statement: The company currently uses various formats to express its financial performance, which makes it challenging for investors to compare the financial performance of different companies. The new guidelines have implemented a more structured income statement. They have introduced a new subtotal called 'operating profit' and require that all revenues and expenses be classified into three new categories based on the company's main business activities.
• Management Performance Measurement (MPMs): The new criteria introduce the concept of management performance measurement. Companies are now required to provide an explanation, in a single footnote in the financial statements, regarding the usefulness of each measurement indicator, its calculation method, and how it is adjusted for amounts recognized in accordance with international financial reporting standards accounting principles.
• More detailed information: The new guidelines provide instructions on how companies can improve the organization of information in financial statements. This guidance includes determining whether the information should be included in the primary financial statements or further disaggregated in the notes. | January 1, 2027
Note: On September 25, 2025, FSC issued a press release announcing that Taiwan will adopt International Financial Reporting Standards 18 starting from fiscal year 2028. If the Company has a need for early adoption, it may elect to adopt early upon approval by the FSC. |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
The Company is now continuously assessing the impact of the above standards and interpretations on the financial position and operating results of the Company, and will disclose the related impact after completing the assessment.
The Company expects that the following newly issued and amended standards that have not been endorsed yet will not have a material impact on the parent company only financial statements.
- Amendments to IFRS 10 and IAS 28 "Sale or Contribution of Assets between an Investor and its Associate or Joint Venture"
- Amendments to IFRS 19 "Subsidiaries without Public Accountability: Disclosures" and IFRS 19
- Amendments to IAS 21 "Translation to a Hyperinflationary Presentation Currency"
IV. Summary of Significant Accounting Policies
The significant accounting policies adopted in the parent company only financial statements are summarized below. The following accounting policies have been applied consistently to all periods presented in the parent company only financial statements.
(I) Statement of Compliance
These accompanying financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.
(II) Basis of Preparation
- Basis of measurement
The parent company only financial statements have been prepared on the historical cost basis, except for the following significant balance sheet items.
(1) Financial instruments (including derivative financial instruments) measured at fair value through profit or loss.
(2) Financial assets at fair value through other comprehensive income; and
(3) Net defined benefit liabilities, which are measured at the present value of the defined benefit obligation less the fair value of pension fund assets.
- Functional and presentation currencies
The functional currency of the Company is the currency of the primary economic environment in which the Company operates. The accompanying parent company only financial statements of the Company are presented in the Company's functional currency, New Taiwan dollar. All financial information dominated in New Taiwan dollars shall be dominated in thousands of NTD, unless otherwise specified.
(III) Foreign currency
- Foreign currency transactions
Foreign currency transactions are translated into functional currencies at the exchange rates prevailing on the dates of transactions. At the end of each subsequent reporting
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
period (hereinafter referred to as the "reporting date"), monetary items denominated in foreign currencies are translated into the functional currency using the exchange rates prevailing on that date. Non-monetary items denominated in foreign currencies that are measured at fair value are translated into the functional currency at the exchange rates prevailing on the date of measurement of the fair value, while non-monetary items measured at historical cost in foreign currencies are translated at the exchange rates prevailing on the date of the transaction.
Translation differences arising from foreign currency translations are generally recognized in profit or loss, except for equity instruments designated as at fair value through other comprehensive income, which are recognized in other comprehensive income.
- Foreign operations
Assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated into the presentation currency of the parent company only financial statements at the exchange rates prevailing on the reporting date; income and expense items are translated into the presentation currency of the parent company only financial statements at the average exchange rates for the period, with the resulting exchange differences recognized in other comprehensive income.
When the disposal of a foreign operating entity results in a loss of control, joint control or significant influence, the cumulative translation differences related to the foreign operating entity are reclassified to profit or loss. When the disposal includes a subsidiary of a foreign operating entity, the related cumulative translation differences are re-attributed to non-controlling interests on a pro rata basis. When the disposal component includes investments in affiliates or joint ventures of foreign operating entities, the related cumulative translation differences are reclassified proportionately to profit or loss.
When there is no plan to settle a monetary receivable or payable from a foreign operation and it is not likely to be settled in the foreseeable future, the resulting foreign currency translation gain or loss is recognized in other comprehensive income as part of the net investment in the foreign operation.
(IV) Criteria for classifying assets and liabilities as current or non-current
The Company classifies assets meeting one of the following conditions as current assets, while all other assets that are not current assets are classified as non-current assets:
- The asset is expected to be realized in the normal course of business or is intended to be sold or consumed;
- The asset is held primarily for trading purposes.
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
- The asset is expected to be realized within twelve months after the reporting period; or
- The asset is cash or cash equivalents (as defined by IAS 7) unless the asset is restricted from being exchanged or used to settle a liability at least 12 months after the reporting period.
The Company classifies liabilities as current liabilities if one of the following conditions is met, and all other liabilities that are not current liabilities are classified as non-current liabilities:
- The liability is expected to be settled in the normal course of business;
- The liability is held primarily for trading purposes;
- The liability is due for settlement within 12 months after the reporting period; or
- The entity does not have the right to defer settlement of the liability beyond twelve months after the end of the reporting period.
(V) Cash and cash equivalents
Cash includes cash on hand, checking deposits and demand deposits. Cash equivalents are short-term, highly liquid investments that are readily convertible into fixed amounts of cash and subject to an insignificant risk of changes in value. Time deposits that meet the above definition and are held to meet short-term cash commitments rather than for investment or other purposes are reported as cash equivalents.
(VI) Financial instruments
Accounts receivable and debt securities issued are recognized as they are incurred. All other financial assets and liabilities are recognized when the Company becomes a party to the contractual provisions of the financial instruments. Financial assets (excluding accounts receivable that do not include significant financial components) or financial liabilities measured at fair value through profit or loss were originally measured at fair value plus transaction costs directly attributable to the acquisition or issuance. Accounts receivable that do not include significant financial components are originally measured at transaction prices.
- Financial assets
Financial assets at the time of initial recognition is classified as follows: Financial assets measured at amortized cost, financial assets measured at fair value through other comprehensive income, and financial assets measured at fair value through profit or loss. Purchase or sale of financial assets in accordance with transaction practices is subject to accounting treatment on the transaction date.
The Company only reclassifies all affected financial assets from the first day of the next reporting period when it changes its business model for managing financial assets.
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
(1) Financial assets measured at amortized cost
Financial assets that simultaneously meet the following conditions and are not designated as measured at fair value through profit or loss are measured at amortized cost:
- The financial asset is held under a business model for the purpose of receiving contractual cash flows.
- The contractual terms of the financial asset generate cash flow on a specific date, which is entirely the interest on the payment of principal and outstanding principal amounts.
After initial recognition, these financial assets are measured using the effective interest rate method at amortized cost less impairment losses. Interest income, foreign currency exchange gain or loss, and impairment losses are recognized in profit or loss. When de-recognized, profit or loss is included in profit or loss.
(2) Financial assets measured at fair value through other comprehensive income
When a debt instrument investment simultaneously meets the following conditions and is not designated as measured at fair value through profit or loss, it is measured at fair value through other comprehensive income:
- The financial asset is held under a business model for the purpose of receiving contractual cash flows and selling.
- The contractual terms of the financial asset generate cash flow on a specific date, which is entirely the interest on the payment of principal and outstanding principal amounts.
Upon initial recognition, the Company may make an irrevocable option to report subsequent changes in the fair value of equity instrument investments not held for trading in other comprehensive income. The above selections were made on a tool by tool basis.
Debt instrument investments are subsequently measured at fair value. Interest income, foreign currency exchange gain or loss, and impairment losses calculated using the effective interest method are recognized in profit or loss, while the remaining net profits or losses are recognized in other comprehensive income. Upon derecognition, the accumulated amount of other comprehensive income under equity is reclassified to profit or loss.
Equity instrument investments are subsequently measured at fair value. Dividend income (unless it clearly represents the recovery of some investment costs) is recognized as profit or loss, and the remaining net profits or losses are recognized as other comprehensive income. When derecognized, the accumulated other comprehensive income under equity are reclassified to
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
retained earnings, not to profit or loss. Dividend income from equity investments is recognized on the date on which the Company is entitled to receive dividends (usually the ex-dividend date).
(3) Financial assets at fair value through profit or loss
Financial assets that are not measured at amortized cost or at fair value through other comprehensive income are measured at fair value through profit or loss, including derivative financial assets. At the time of initial recognition, in order to eliminate or significantly reduce accounting mismatch, the Company may irrevocably designate financial assets that meet the criteria for measurement at amortized cost or fair value through other comprehensive income as financial assets measured at fair value through profit or loss.
These assets are subsequently measured at fair value, and the net gains or losses (including any dividends and interest income) arising from remeasurement are recognized as profit or loss.
(4) Impairment of financial assets
The Company recognizes an allowance for expected credit losses on financial assets measured at amortized cost, including cash and equivalents, financial assets measured at amortized cost, notes and accounts receivable, other receivables, and deposits.
The following financial assets are measured as allowance losses based on the expected amount of credit losses over a twelve-month period, while the remaining financial assets are measured based on the expected amount of credit losses during their lifetime:
- The credit risk of bank deposits (i.e., the risk of default during the expected lifetime of a financial instrument) has not significantly increased since the initial recognition.
The allowance for losses on accounts receivable is measured by the expected amount of credit losses during the period of existence.
The expected credit loss during the expected lifetime of a financial instrument refers to the expected credit loss caused by all possible default events during the expected lifetime of the financial instrument. "Twelve month expected credit loss" refers to the expected credit loss caused by a possible default event of a financial instrument within twelve months after the reporting date (or a shorter period, if the expected duration of the financial instrument is less than twelve months).
The maximum period for measuring expected credit losses is the longest contractual period during which the Company is exposed to credit risk.
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
In determining whether the credit risk has significantly increased since the initial recognition, the Company considers reasonable and verifiable information (available without excessive cost or investment), including qualitative and quantitative information, and analysis based on the historical experience, credit evaluation, and forward-looking information of the Company.
The expected credit loss is a weighted estimate of the probability of credit loss during the expected lifetime of a financial instrument. Credit losses are measured at the present value of all cash shortfalls, which is the difference between the cash flows that the Company can receive under the contract and the cash flows that the Company expects to receive. Expected credit losses are discounted at the effective interest rate of the financial assets.
Allowance for losses on financial assets measured at amortized cost is deducted from the carrying amount of the assets.
When the Company does not have a reasonable expectation of recovering all or part of a financial asset, the total carrying amount of the financial asset is directly reduced. The Company analyzes the timing and amount of write-offs individually on the basis of whether recovery is reasonably expected. The Company does not expect any material reversal of the amount written off. However, financial assets that have been written off are still enforceable in order to comply with the Company's procedures for recovering overdue amounts.
(5) Derecognition of financial assets
The Company derecognizes a financial asset only when the contractual rights to the cash flows from the asset cease, or when the financial asset has been transferred and substantially all the risks and rewards of ownership of the asset have been transferred to other enterprises, or when substantially all the risks and rewards of ownership of the asset have neither been transferred nor retained and control of the financial asset has not been retained.
If the Company enters into a transaction to transfer a financial asset, the financial asset is continuously recognized in the balance sheet if all or substantially all the risks and rewards of ownership of the transferred asset are retained.
- Financial liabilities and equity instruments
(1) Classification of liabilities or equity
Debt and equity instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
contractual arrangements and the definitions of a financial liability and an equity instrument.
(2) Equity transactions
An equity instrument is any contract that recognizes the Company's remaining interest in an asset less all of its liabilities. Equity instruments issued by the Company are recognized at the proceeds received less the cost of direct issuance.
(3) Financial liabilities
Financial liabilities are classified as being measured at amortized cost or at fair value through profit or loss. Financial liabilities are classified as being measured at fair value through profit or loss if they are held for trading, derivative instruments or designated at initial recognition. Financial liabilities measured at fair value through profit or loss are measured at fair value, and the related net gain or loss, including any interest expense, are recognized in profit or loss.
Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and exchange gain or loss are recognized in profit or loss. Any gain or loss on derecognization is also recognized in profit or loss.
(4) Derecognition of financial liabilities
The Company derecognizes financial liabilities when the contractual obligations are fulfilled, canceled or expired. When the terms of a financial liability are modified and the cash flows of the modified liability are materially different, the original financial liability is derecognition and the new financial liability is recognized at fair value based on the modified terms. When a financial liability is derecognized, the difference between the carrying amount and the total consideration paid or payable (including any non-cash assets transferred or liabilities assumed) is recognized in profit or loss.
(5) Offsetting of financial assets and liabilities
Financial assets and financial liabilities are offset and presented in the balance sheet on a net basis only when the Company has a legally enforceable right to do so and intends to settle on a net basis or to realize the assets and settle the liabilities simultaneously.
- Derivative financial instruments
The Company holds derivative financial instruments to hedge the risk of foreign currency exposure. Derivatives are initially recognized at fair value, with transaction costs recognized in profit or loss; subsequently, they are measured at fair value, with
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
gains or losses arising from remeasurement recognized directly in profit or loss. When its fair value is positive, the derivative is recognized as a financial asset; when its fair value is negative, the derivative is recognized as a financial liability.
(VII) Inventories
Inventories are measured at the lower of cost or net realizable value. Inventories include acquisition, production or processing costs and other costs incurred in bringing them to the place and condition in which they are available for use and are measured using the weighted-average method. Fixed manufacturing costs are allocated to finished goods and work in process based on the higher of normal production capacity or actual production of the production equipment, while variable manufacturing costs are allocated on the basis of actual production. Net realizable value is the estimated selling price under normal operations less estimated costs of completion and selling expenses required to complete the sale.
(VIII) Investment in associates
Associates refer to entities over which the Company has material impact on financial and operational policies but does not exercise control or joint control.
The Company applies the equity method to account for its interests in associates. Under the equity method, the initial acquisition is recorded at cost, including the transaction costs related to the investment. The carrying amount of investments in associates includes the goodwill recognized at the time of the initial investment, adjusted for any accumulated impairment losses. In the impairment assessment, the total carrying amount of the investment (including goodwill) is treated as a single asset. The recoverable amount is compared to the carrying amount to perform the impairment test. Any recognized impairment loss is recorded as a reduction in the carrying amount of the investment. Any reversal of impairment losses will be recognized in accordance with subsequent increases in the recoverable amount of the investment.
From the date the Company gains significant influence until the date it loses such influence, the Company shall recognize the profit and loss, as well as other comprehensive income, of each associate under the equity method, making adjustments to align with the Company's accounting policies. When an associate experiences changes in equity, not related to profit or other comprehensive income, and these changes do not affect the Company's ownership percentage, the Company will recognize the entire equity change as capital reserve in proportion to its shareholding.
When the Company is required to recognize its share of losses from associates that equal or exceed its equity in those enterprises, it will cease to recognize further losses. Additional losses and related liabilities will only be recognized to the extent of any statutory obligations, presumed obligations, or amounts already paid on behalf of the invested company.
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
(IX) Investments in subsidiaries
In the preparation of the parent company only financial statements, the Company adopts the equity method to evaluate the investee companies under its control. The carrying amount of an investment in a subsidiary includes goodwill recognized at the time of the original investment, less any accumulated impairment loss, which is recognized as a decrease in carrying amount of investment. Under the equity method, the current gains or losses and other composite gains or losses of the financial statements shall be the same as the share of the current gains or losses and other composite gains or losses attributable to the owners of the parent company in the financial statements prepared on a consolidated basis. Equity attributable to the owners of financial statements should be the same as the equity attributable to the owners of the parent company in the financial statements prepared on a consolidated basis.
Where the change in the Company's ownership interest in the subsidiary does not result in the loss of control, it shall be treated as an equity transaction with the owner.
(X) Property, plant and equipment
- Recognition and measurement
Property, plant and equipment are measured at cost (including capitalized borrowing costs) less accumulated depreciation and any accumulated impairment.
If the significant components of property, plant and equipment have different useful lives, they are treated as separate items (major components) of property, plant and equipment.
Gain or loss on disposal of property, plant and equipment is recognized in profit or loss.
- Subsequent costs
Subsequent expenditures are capitalized only when it is probable that future economic benefits will flow to the Company.
- Depreciation
Depreciation is calculated on the basis of the cost of an asset less its residual value and is recognized in profit or loss over the estimated useful life of each component using the straight-line method. Except for land, which is not subject to depreciation, the estimated useful lives of the remaining components are. Machinery equipment: 2 to 10 years; office and other equipment: 2 to 15 years. In addition, buildings and structures are depreciated over their estimated useful lives based on their significant components: 20 to 50 years for main and auxiliary buildings, and 3 to 10 years for other auxiliary electrical and mechanical equipment and engineering systems.
The depreciation method, useful lives and residual values are reviewed at each reporting date, and the effects of any changes in estimates are deferred and adjusted.
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
(XI) Investment property
Investment property refers to property held to earn rentals or for capital appreciation, or both. Investment property is measured at cost when initially recognized, and subsequently measured at cost less accumulated depreciation and less accumulated impairment losses. The depreciation method, useful life, and residual values shall be compared with the regulations on property, plant, and equipment. Costs include expenses directly attributable to the acquisition of investment property and any directly attributable costs of bringing investment property ready for use and borrowing costs capitalized.
Gains or losses on the disposal of the investment property (calculated as the difference between the net disposal price and the carrying amount of the item) are recognized in profit or loss.
Rental income arising from investment property is recognized on a straight-line basis over the lease period. The incentives for leasing are recognized as an adjustment to lease income during the lease period.
When the use of investment property is changed and reclassified as property, plant, and equipment, the book value at the time of change of use shall be used for reclassification.
(XII) Leases
The Company assesses whether a contract is or comprises a lease at the inception date of the contract. A contract is or comprises a lease if it transfers control over the use of an identified asset for a period of time in exchange for consideration.
- Lessees
The Company recognizes a right-of-use asset and a lease liability at the commencement date of the lease. The right-of-use asset is measured initially at cost, which includes the original measurement of the lease liability, adjusted for any lease payments made on or before the commencement date of the lease, plus the original direct costs incurred and the estimated costs to disassemble, remove and restore the subject asset to its location or to the subject asset, less any lease incentives received. The lease payments are added to the original direct costs incurred and the estimated costs of dismantling, removing and restoring the subject asset to its location or to the subject asset, less any incentives received.
Right-of-use assets are subsequently depreciated on a straight-line basis from the lease commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. In addition, the Company periodically assesses whether a right-of-use asset is impaired and addresses any impairment loss incurred, and adjusts the right-of-use asset when the lease liability is remeasured.
Lease liabilities are measured initially at the present value of the lease payments outstanding at the inception date of the lease. If the implied interest rate of the lease is
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
readily determinable, the discount rate is that rate; if it is not readily determinable, the Company's incremental borrowing rate is used. In general, the Company uses its incremental borrowing rate as the discount rate.
Lease payments included in the measurement of lease liabilities include:
(1) Fixed payments, including real fixed payments:
(2) Variable lease payments that depend on an index or rate, using the index or rate at the inception date of the lease as the original measure:
(3) The amount of the residual value guarantee expected to be paid; and
(4) The exercise price or penalty to be paid if it is reasonably certain that the option to purchase or the option to terminate the lease will be exercised.
Lease liabilities are subsequently accrued for using the effective interest method and are remeasured when the following occurs:
(1) There is a change in future lease payments as a result of a change in the index or rate used to determine lease payments;
(2) There is a change in the amount of the residual value guarantee expected to be paid.
(3) There is a change in the evaluation of the purchase option on the subject asset; and
(4) There is a change in the estimate of whether to exercise the option to extend or terminate the lease, resulting in a change in the evaluation of the lease term;
(5) There is a change in the subject matter, scope or other terms of the lease.
When a lease liability is remeasured as a result of changes in the index or rate used to determine lease payments, changes in the residual value guarantee amount and changes in the evaluation of the purchase, extension or termination option as described above, the carrying amount of the right-of-use asset is adjusted accordingly and the remaining remeasurement amount is recognized in profit or loss when the carrying amount of the right-of-use asset is reduced to zero.
For lease modifications that reduce the scope of the lease, the carrying amount of the right-of-use asset is reduced to reflect the partial or full termination of the lease, and the difference between the carrying amount and the remeasurement amount of the lease liability is recognized in profit or loss.
The Company presents right-of-use assets and lease liabilities that do not meet the definition of investment property as separate line items in the balance sheet.
For short-term leases and leases of low-value underlying assets, the Company chooses not to recognize right-of-use assets and lease liabilities, and instead recognizes the related lease payments as expenses on a straight-line basis over the lease term.
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
2. Lessors
Transactions in which the Company is the lessor are classified as finance leases on the inception date of the lease based on whether the lease contracts transfer substantially all the risks and rewards incidental to the ownership of the subject assets, and otherwise are classified as operating leases. In its evaluation, the Company considers specific indicators, including whether the lease period covers a significant portion of the economic life of the subject asset.
If the Company is the lessor of a sublease, it treats the main lease and the sublease transaction separately and assesses the classification of the sublease transaction using the right-of-use assets arising from the main lease. If a master lease is a short-term lease and the recognition exemption applies, the sublease transaction should be classified as an operating lease.
For operating leases, the Company recognizes the lease payments received as rental income over the lease term on a straight-line basis.
(XIII) Intangible assets
The Company's acquisition of purchased software is measured at cost less accumulated amortization and accumulated impairment. Amortization is provided on a straight-line basis over the estimated useful lives of 3 to 5 years and is recognized in profit or loss.
The Company reviews the residual value, useful life and amortization method of intangible assets at each reporting date, and makes appropriate adjustments when necessary.
(XIV) Impairment of non-financial assets
The Company assesses at each reporting date whether there is any indication that the carrying amount of non-financial assets (other than inventories and deferred income tax assets) may be impaired. If any such indication exists, the recoverable amount of the asset is estimated. Goodwill is tested for impairment annually or whenever there is an indication of impairment.
The purpose of the impairment test is to identify a group of assets as the smallest identifiable group of assets for which a significant portion of the cash inflows are separate from other individual assets or groups of assets. Goodwill acquired on a business combination is allocated to each cash-generating unit or group of cash-generating units that is expected to benefit from the combined effect.
The recoverable amount is the higher of the fair value of the individual asset or cash-generating unit, less costs to dispose, and its value in use. In assessing value in use, estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or cash-generating unit.
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
An impairment loss is recognized if the recoverable amount of an individual asset or cash-generating unit is less than its carrying amount. The impairment loss is recognized immediately in profit or loss and reduces the carrying amount of the goodwill amortized for the cash-generating unit first, and then reduces the carrying amount of each asset in proportion to the carrying amount of the other assets in the unit.
The impairment loss on goodwill is not subject to reversal. Non-financial assets other than goodwill are reversed only to the extent that the carrying amount of the asset, net of depreciation or amortization, would have been determined had no impairment loss been recognized in prior years.
(XV) Provisions
Provisions for liabilities are recognized when the Company has a present obligation as a result of a past event, it is probable that an outflow of economic resources will be required to settle the obligation in the future, and the amount of the obligation can be reliably estimated.
The provision for product warranty liability is recognized when the product is sold. The provision for this liability is measured based on historical warranty information and all probable outcomes weighted by their respective probabilities.
(XVI) Revenue recognition
Revenue is measured at the consideration to which the Group is expected to be entitled as a result of the transfer of goods or services. The Company recognizes revenue when control of goods or services is transferred to customers to satisfy performance obligations. The Company explains the main revenue items as follows:
- Sales of goods
The Company recognizes revenue when control of the goods is transferred to customers. Transfer of control of goods means that the goods has been delivered to the customer, the customer is able to determine the sales channel and price of the product, and there are no outstanding obligations that would affect the customer's acceptance of the goods. Delivery occurs when the product is delivered to a specific location, the risk of obsolescence and loss has been transferred to the customer, the customer has accepted the product in accordance with the terms of the transaction, and the Company has objective evidence that all acceptance conditions have been met.
The Company has a refund obligation for defective products sold and has recognized a provision for warranty liability for this obligation.
The Company recognizes accounts receivable upon delivery of goods because the Company has the unconditional right to receive the consideration at that point in time.
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Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
- Financial components
The Company does not adjust the time value of money of the transaction price because the time interval between the expected transfer of goods to customers and the payment of goods or services by customers does not exceed one year.
(XVII) Employee benefits
- Defined contribution plans
The contribution obligation of the defined contribution pension plan is recognized as employee benefit expense in profit or loss during the period in which the employees render service.
- Defined benefit plans
The net obligation under the defined benefit pension plan is calculated as the discounted value of the future benefit amounts to be earned by each plan for each employee's current or prior service, less the fair value of any plan assets. The discount rate is based on the market yield rate at the reporting date for government bonds with maturity dates approximating the term of the Company's net obligation and denominated in the same currency as the expected benefit payments. The net obligation of the defined benefit plans is actuarially determined annually by a qualified actuary using the projected unit benefit method.
When benefits under a plan are improved, the related expense is recognized immediately in profit or loss for the portion of the benefit increase attributable to employees' past service.
The remeasurement of the net defined benefit liability (asset) consists of (1) actuarial gain or loss; (2) compensation on plan assets, excluding the amount included in net interest on the net defined benefit liability (asset); and (3) any change in the asset ceiling effect, excluding the amount included in net interest on the net defined benefit liability (asset). The remeasurement of the net defined benefit liability (asset) is recognized in other comprehensive income and is transferred to retained earnings in the current period.
The Company recognizes a gain or loss on the curtailment or settlement of a defined benefit plan when the curtailment or settlement occurs. The curtailment or settlement gain or loss includes the change in the fair value of any plan assets and the change in the present value of the defined benefit obligation.
- Short-term employee benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are recognized as an expense when the related services are rendered. The amount expected to be paid under short-term cash bonus or dividend plans is recognized as a
~23~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
liability when the Company has a present legal or constructive obligation to pay for the services rendered by employees and the obligation can be reliably estimated.
(XVIII) Income taxes
Income tax expense includes current and deferred income taxes. Current and deferred income taxes are recognized in profit or loss, except when they relate to business combinations, items recognized directly in equity or other comprehensive income.
Current income taxes include estimated income taxes payable or refunds receivable based on current year's taxable income (loss) and any adjustments to prior years' income taxes payable or refunds receivable. The amount reflects the best estimate of the amount expected to be paid or received, measured at the statutory tax rate at the reporting date or the tax rate of substantive legislation, after reflecting uncertainties, if any, related to income taxes.
Deferred income taxes are recognized on temporary differences between the carrying amounts of assets and liabilities at the reporting date and their tax bases. Deferred income tax is not recognized for temporary differences arising from:
- Assets or liabilities that are not part of a business combination and are recognized initially in a transaction that (i) at the time of the transaction do not affect the accounting profit or taxable income (loss) and (ii) do not result in an equal number of taxable and deductible temporary differences;
- Temporary differences arising from investments in subsidiaries, affiliates and joint ventures where the timing of the reversal of the temporary differences is controlled by the Company and it is probable that the temporary differences will not reverse in the foreseeable future; and
- Taxable temporary differences arising from the original recognition of goodwill.
Deferred income tax assets are recognized for unused tax losses and unused tax credits in subsequent periods, together with deductible temporary differences, to the extent that it is probable that future taxable income will be available for use. Deferred income tax assets are reassessed at each reporting date and reduced to the extent that it is not probable that the related income tax benefit will be realized or to the extent that it becomes probable that sufficient taxable income will be available to allow the reversal of the original reduction.
Deferred income taxes are measured at the tax rates that are expected to apply to the reversal of temporary differences, based on the statutory tax rate at the reporting date or the tax rate of substantive legislation, and reflecting uncertainties, if any, related to income taxes.
The Company shall offset deferred income tax assets and deferred income tax liabilities only if the following conditions are met at the same time:
~24~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
- There is a legally enforceable right to offset current income tax assets and current income tax liabilities; and
- The deferred income tax assets and deferred income tax liabilities relate to one of the following taxable entities that are subject to income tax by the same taxing authority:
(1) The same taxable entity; or
(2) Different taxable entities, provided that each entity intends to settle current income tax liabilities and assets on a net basis, or to realize assets and settle liabilities simultaneously, in each future period in which significant amounts of deferred income tax assets are expected to be recovered and deferred income tax liabilities are expected to be settled.
(XIX) Business Combination
The Company uses the acquisition method of accounting to account for the combined subsidiaries. Goodwill is measured at the fair value of the consideration transferred at the acquisition date, including the amount attributable to any non-controlling interest in the acquiree, less the net amount of the identifiable assets acquired and liabilities assumed, which is generally the fair value. If the resulting balance is negative, the Company reassesses whether all assets acquired and liabilities assumed have been properly recognized before recognizing the benefit of the bargain purchase in profit or loss.
Transaction costs associated with a business combination are recognized as expenses of the combining company as soon as they are incurred, except when they relate to the issuance of debt or equity instruments.
The non-controlling interests in the acquiree that are presently owned and whose holders are entitled to a proportionate share of the net assets of the business at the time of liquidation are measured, at the option of the Company, on a transaction-by-transaction basis, at either the acquisition date fair value or at the present ownership instrument's proportionate share of the recognized amount of the acquiree's identifiable net assets. Other non-controlling interests are measured at their fair values at the acquisition date or on other bases in accordance with IFRSs recognized by the FSC.
If the original accounting for a business combination is not completed before the reporting date of the combination transaction, the Company reports the outstanding accounting items at provisional amounts and makes retroactive adjustments or recognizes additional assets or liabilities during the measurement period to reflect new information obtained during the measurement period about facts and circumstances existing at the acquisition date. The measurement period does not exceed one year from the date of acquisition.
~25~
~26~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
In a business combination entered into in stages, the Company remeasures its previously held interest in the acquiree at its acquisition-date fair value, and any resulting gain or loss is recognized in profit or loss. Changes in the value of the acquiree's interest that were recognized in other comprehensive income before the acquisition date should be treated in the same manner as if the Company had directly disposed of its previously held interest, and if it is appropriate to reclassify the interest to profit or loss upon disposal, the amount is reclassified to profit or loss.
(XX) Earnings per share
The Company presents basic and diluted earnings per share attributable to equity holders of the Company's common stock. Basic earnings per share of the Company is calculated by dividing the profit or loss attributable to the holders of the Company's common stock by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is calculated by adjusting the profit or loss attributable to equity holders of the Company's common stock and the weighted-average number of common shares outstanding, respectively, for the effect of all potentially dilutive common shares. The potential diluted common stock of the Company is the employee compensation that may be issued in stock.
(XXI) Segment Information
The Company has disclosed segment information in the consolidated financial statements and therefore does not disclose segment information in the parent company only financial statements.
V. Major Sources of Uncertainty in Significant Accounting Judgments, Estimates and Assumptions
When preparing the parent company only financial statements, the management shall make judgments and estimates for the future (including climate related risks and opportunities), which will affect the adoption of accounting policies and the reported amounts of assets, liabilities, incomes and expenses. Actual results may differ from estimates.
Management regularly reviews estimates and key assumptions to ensure they are consistent with the Company's risk management and climate-related commitments. Any changes in estimates are recognized during the period of change and deferred to the relevant future periods.
Accounting policies require significant judgment, and the following information has a substantial impact on the amounts recognized in these parent company only financial statements:
(I) Judgment of Significance of Impact on Invested Companies
The Company holds less than 20% of the voting rights in APLEX Technology Inc. (APLEX) but owns 13.36% of the voting shares, making it the largest single shareholder. This position allows the Company to elect directors to the Board and participate in
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
decision-making regarding APLEX's financial and operational policies, thereby exerting significant impact over the Company.
The uncertainties in the following assumptions and estimates have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities in the next fiscal year, and the relevant information is as follows:
(I) Valuation of inventories
Inventories are measured at the lower of cost or net realizable value. The Company assesses the amount of inventories that are normally worn out, obsolete or have no marketable value at the reporting date and reduces the cost of inventories to net realizable value. This inventory valuation is primarily based on estimates of product demand in specific periods in the future and is subject to significant changes due to rapid changes in the industry. Please refer to Note VI (VII) for the valuation of inventories.
(II) Impairment assessment of goodwill arising from investment in subsidiaries
The carrying amount of the invested subsidiary includes the goodwill identified at the time of the original investment. The process of assessing goodwill impairment relies on the Company's subjective judgment, which includes identifying cash-generating units, allocating goodwill to the relevant cash-generating units, and determining the recoverable amount of the relevant cash-generating units. Any changes in economic conditions or corporate strategy may cause significant changes in the results of the assessment.
VI. Description of Significant Accounting Items
(I) Cash and cash equivalents
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Cash on hand and petty cash | $ 67 | 130 |
| Demand deposits and check deposits | 300,556 | 417,913 |
| $ 300,623 | 418,043 |
(II) Financial instruments at fair value through profit or loss
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Financial assets mandatorily classified at fair value through profit or loss - current: | ||
| Non-hedging derivative instruments: | ||
| Forward foreign exchange contracts | $ 98 | 322 |
| Foreign exchange SWAP contracts | 144 | - |
| Subtotal | 242 | 322 |
| Non-derivative financial assets: | ||
| Fund beneficial certificates | 20,765 | 22,135 |
| $ 21,007 | 22,457 |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Equity instruments at fair value through profit or loss - non-current: | ||
| Stocks of domestic unlisted companies | $ 20,000 | - |
| Financial liabilities held for trading - current: | ||
| Derivative financial instruments: | ||
| Forward foreign exchange contracts | $ 346 | 649 |
| Foreign exchange SWAP contracts | 814 | 3,102 |
| Subtotal | $ 1,160 | 3,751 |
Please refer to Note VI (XXII) for the amount recognized in profit or loss measured at fair value.
The Company engages in derivative financial instruments to hedge the exposure to exchange rate risk arising from operating activities, which are reported as financial assets or liabilities measured at fair value through profit or loss because hedge accounting is not applied. The details of the derivative financial instruments not yet matured as of the reporting date are as follows:
- Forward foreign exchange contracts
2025.12.31
| Currency | Contract amount (in thousands) | Maturity period |
|---|---|---|
| Buy USD/Sell RMB | USD 1,013 | 2026.1 |
| Buy JPY/Sell USD | USD 625 | 2026.1 |
| Buy EUR/Sell USD | USD 2,808 | 2026.1 |
| 2024.12.31 | ||
| Currency | Contract amount (in thousands) | Maturity period |
| Buy USD/Sell RMB | USD 579 | 2025.1 |
| Buy JPY/Sell USD | USD 1,157 | 2025.1 |
| Buy EUR/Sell USD | USD 2,403 | 2025.1 |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
- Foreign exchange SWAP contracts
| 2025.12.31 | ||
|---|---|---|
| Currency | Contract amount (in thousands) | Maturity period |
| Swap in NTD/swap out USD | USD 8,050 | 2026.1 |
| 2024.12.31 | ||
| Currency | Contract amount (in thousands) | Maturity period |
| Swap in NTD/swap out USD | USD 10,800 | 2025.1 |
(III) Financial assets at fair value through other comprehensive income - non-current
The Company originally held shares in APLEX Technology Inc. (APLEX) classified as financial assets measured at fair value through other comprehensive income. In 2024, the Company increased its shareholding in APLEX and assessed that it has obtained significant influence. Accordingly, the equity investment previously measured at fair value through other comprehensive income was reclassified as an investment accounted for using the equity method in the amount of NT$117,587 thousand. In addition, the unrealized gain of NT$38,647 thousand recognized in other equity—financial assets at fair value through other comprehensive income—was transferred to retained earnings.
(IV) Financial assets carried at amortized cost - current
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Pledged certificate of deposit | $ 1,500 | 1,500 |
Please refer to Note VIII for details of the aforesaid financial assets used by the Company to provide guarantees.
(V) Accounts receivable and other receivables
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Accounts receivable | $ 257,379 | 307,454 |
| Accounts receivable - related parties | 246,742 | 293,886 |
| Less: Allowance for loss | (2,552) | (679) |
| $ 501,569 | 600,661 | |
| Other receivables | $ 14,601 | 11,631 |
| Other receivables - related parties | 3,217 | 14,451 |
| $ 17,818 | 26,082 |
The Company uses a simplified approach to estimate expected credit losses for all accounts receivable, which is measured using expected credit losses for the duration of the period, and has included forward-looking information. The expected credit losses of the Company's accounts receivable were analyzed as follows:
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
| 2025.12.31 | |||
|---|---|---|---|
| Carrying amount of accounts receivable | Weighted average expected credit loss rate | Allowance for expected credit losses for the duration of the period | |
| Not overdue | $ 195,077 | 0% | - |
| 1-30 days overdue | 57,434 | 0% | - |
| 31-60 days overdue | 2,316 | 0% | - |
| Overdue for more than 90 days | 2,552 | 100% | 2,552 |
| $ 257,379 | 2,552 | ||
| 2024.12.31 | |||
| Carrying amount of accounts receivable | Weighted average expected credit loss rate | Allowance for expected credit losses for the duration of the period | |
| Not overdue | $ 251,884 | 0% | - |
| 1-30 days overdue | 45,099 | 0.46% | 206 |
| 31-60 days overdue | 7,332 | 1.72% | 126 |
| 61-90 days overdue | 3,139 | 11.05% | 347 |
| $ 307,454 | 679 |
Accounts receivable—related parties on December 31, 2025 and 2024 are expected to have no expected credit losses as evaluated by the Company and are analyzed as follows:
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Not overdue | $ 238,668 | 280,019 |
| 1-30 days overdue | 3,555 | 8,927 |
| 31-60 days overdue | 4,519 | 4,940 |
| $ 246,742 | 293,886 |
The statement of changes in the allowance for losses of the Company's accounts receivable is listed as follows:
| 2025 | 2024 | |
|---|---|---|
| Beginning balance | $ 679 | 921 |
| Recognition (reversal) of impairment losses for the period | 1,873 | (242) |
| Ending balance | $ 2,552 | 679 |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
(VI) Inventories
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Raw materials | $ 532,259 | 226,912 |
| Work in progress | 121,753 | 105,739 |
| Finished goods and commodities | 91,524 | 84,998 |
| Goods in transit | 24,980 | 58,315 |
| Outsourced processed goods | 16,766 | 1,086 |
| $ 787,282 | 477,050 |
The inventory-related expenses and losses recognized in the operating cost in the current period are detailed as follow:
| 2025 | 2024 | |
|---|---|---|
| Cost of inventory sold | $ 2,893,190 | 2,380,309 |
| Gain from price recovery of inventory | (40,835) | (11,659) |
| Inventory scrap loss | 34,779 | 7,772 |
| Inventory gain | 8 | 5 |
| $ 2,887,142 | 2,376,427 |
The above inventories recovery gains resulted from the Company's sale or scrapping of slow-moving inventories; accordingly, recovery gains were recognized by reversing the prior inventory falling price loss that had reduced the original inventories to net realizable value.
(VII) Investments accounted for under the equity method
Investments of the Company under equity method at reporting date are listed below:
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Subsidiary | $ 3,261,513 | 3,234,842 |
| Associate | 265,039 | 272,944 |
| $ 3,526,552 | 3,507,786 |
- Acquisition of subsidiary - Transpak Equipment Corporation
(1) Consideration transferred for acquisition of the subsidiary
On August 12, 2024 (the acquisition date), the Company and its consolidated subsidiary, Ace Pillar, acquired 833 thousand ordinary shares of Transpak Equipment Corporation (TPK) for a cash consideration of NT$1,250,000 thousand, representing a 70.65% equity interest, thereby obtaining control over this company and has included it in the consolidated financial statements since the acquisition date. TPK is primarily engaged in the production, manufacturing, and trading of bundling equipment. The acquisition of TPK by the Group and its subsidiary Ace Pillar is aimed at supporting the company's long-term operational development and business expansion. This acquisition will enable
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
the Group to offer a more diverse range of products and services to its customers, thereby enhancing its competitiveness.
(2) Identifiable net assets acquired and goodwill recognized
The fair values of the identifiable assets acquired and liabilities assumed of the Company and its subsidiary, Ace Pillar on August 12, 2024 (acquisition date) and the goodwill recognized as a result of the acquisition are as follows:
Transfer consideration:
Cash $ 1,250,000
Add: Non-controlling interests (measured by the proportion of non-controlling interests in net identifiable assets) 301,768
Less: fair value of net identifiable assets acquired:
Cash and cash equivalents $ 385,305
Net notes and accounts receivable 774
Other receivables 25,084
Inventories 331,743
Prepayments and other current assets 1,844
Property, plant and equipment 2,035
Right-of-use assets 66,327
Intangible assets-Trademark 185,911
Intangible assets - Patents 69,054
Intangible assets - Client relationship 630,208
Deferred income tax assets 3,812
Refundable deposits 1,547
Contract liabilities (29,369)
Notes and accounts payables (167,031)
Other payables (21,100)
Current income tax liabilities (24,974)
Preferred share liabilities - current (196,797)
Other current liabilities (382)
Lease liabilities (including current and non-current) (66,327)
Deferred income tax liabilities (169,135)
Other non-current liabilities (278) 1,028,251
Goodwill $ 523,517
~32~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
The aforementioned goodwill is attributed to our Company and its subsidiary, Ace Pillar Co., Ltd., amounting to NT$234,535 thousand and NT$288,982 thousand, respectively.
During the measurement period, the Company continuously reviewed the aforementioned matters and adjusted other receivables, deferred tax liabilities, and non-controlling interests in the first quarter of 2025 as follows:
| Increase in other receivables | $ 3,911 |
|---|---|
| Increase in deferred income tax liabilities | (7,900) |
| Increase in non-controlling interests | 1,171 |
| Decrease in goodwill | $ (2,818) |
During the measurement period, the Company continuously reviewed the aforementioned matters and adjusted aforementioned intangible assets, deferred tax liabilities, and non-controlling interests in the fourth quarter of 2024 as follows:
| Intangible assets - decrease in trademark rights | $ (21,256) |
|---|---|
| Decrease in intangible assets - patents | (8,040) |
| Increase in intangible assets - client relationships | 56,510 |
| Increase in deferred income tax liabilities | (5,443) |
| Decrease in non-controlling interests | (6,390) |
| Increase in goodwill | $ 15,381 |
After the above adjustments, the goodwill is attributed to our Company and its subsidiary, Ace Pillar Co., Ltd., amounting to NT$228,907 thousand and NT$282,047 thousand, respectively.
(3) Intangible assets
The trademark rights, patent rights and customer relationships are amortized on a straight-line basis over their respective projected future economic benefit period of 10 years, 6 years, and 15.39 years, respectively.
Goodwill mainly comes from the profitability of TPK, the comprehensive effect of merger, future market development, and the value of its human resources team, with no expected income tax effect. Goodwill in the parent company only financial statements is included in the carrying amount of investments in subsidiaries accounted for using the equity method.
- Disposal of subsidiary shares (without loss of control)
Between July and December of 2024, our Company sold a portion of its equity in Ace Pillar for cash totaling NT$214,138 thousand, thereby reducing its ownership stake in Ace Pillar from 48.07% to 46.71%.
~33~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
The changes in the ownership interest of the Company in the aforementioned subsidiaries have produced the following impact on the owners' equity attributable to the parent company:
| 2024 | |
|---|---|
| Consideration received | $ 214,138 |
| Carrying amount of the disposal of subsidiary equities | (30,509) |
| Other equity: | |
| Exchange differences on translating the financial statements of foreign operations | (268) |
| Unrealized gain (loss) on financial assets measured at fair value through other comprehensive income in other equity | 49 |
| Capital reserve - Differences between the actual price for acquisition or disposal of the subsidiaries and their carrying amount | $ 183,410 |
3. Impairment test of goodwill
If the investment cost for the Company to acquire a subsidiary exceeds the amount of the net fair value of its share of the identifiable assets and liabilities in the investee on the acquisition date, it shall be listed as goodwill; if the goodwill is impaired, it shall be regarded as a decrease in the carrying value of the investment accounted for using the equity method in the parent company only financial statements. As of December 31, 2025 and 2024, goodwill obtained through mergers and acquisitions was allocated to the following cash generating units (or groups of cash generating units) expected to benefit from the comprehensive effects of the merger:
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| DFI AMERICA, LLC. | $ 177,874 | 177,874 |
| Transpak Equipment Corporation | 510,954 | 508,136 |
| Other cash generating units with non-significant goodwill amortized | 115,419 | 115,419 |
| $ 804,247 | 801,429 |
The above cash generating units are the smallest units under the management's supervision of investment returns on goodwill containing assets. According to the results of goodwill impairment testing conducted by the Company, the recoverable amount as of December 31, 2025 and 2024 was higher than its carrying amount, so there is no need to recognize impairment losses. The recoverable amount of the cash generating units are determined based on value in use, with key assumptions as follows:
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
The key assumptions used to estimate value in use are as follows:
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| DFI America, LLC. : | ||
| Operating revenue growth rate | (22.8%)~36.7% | (18%)~18.9% |
| Discount rate | 11.09% | 11.33% |
| TPK: | ||
| Operating revenue growth rate | 5%~11.65% | 2.11%~2.50% |
| Discount rate | 10.50% | 10.68% |
(1) The estimated future cash flow used is a five-year financial budget estimated by the management based on future operating plans. Cash flows over five years are extrapolated using an annual growth rate of 0%.
(2) The discount rate for determining the value in use is based on the weighted average cost of capital as the estimation basis.
4. Associate
The affiliated enterprises that are significant to the Company are as follows:
| Name of Affiliated Enterprise | Nature of Relationship with the Company | Primary business premises/ country of incorporation | Proportion of ownership interests and voting rights | |
|---|---|---|---|---|
| 2025.12.31 | 2024.12.31 | |||
| APLEX Technology Inc. | The main business is the research and development, as well as the manufacturing, of industrial computer products, serving as a strategic partner of the Company. | Taiwan | 13.36% | 13.36% |
Before December 24, 2024, APLEX held financial assets measured at fair value through other comprehensive income, which had a significant impact as of that date. For the reclassification of investments using the equity method, please refer to Note VI(III).
The fair value regarding significant associates of our Company listed (OTC) and are listed is as follows:
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| APLEX | $ 189,868 | 254,810 |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
The summary financial information regarding significant associates of our Company is as follows:
(1) Summary financial information for APLEX:
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Current assets | $ 561,466 | 567,378 |
| Non-current assets | 1,574,059 | 1,591,538 |
| Current liabilities | (240,146) | (183,221) |
| Non-current liabilities | (341,218) | (362,027) |
| Net assets | $ 1,554,161 | 1,613,668 |
| Net assets attributable to non-controlling interests | $ - | - |
| Net assets attributable to the owners of the investee company | $ 1,554,161 | 1,613,668 |
| 2025 | 2024 | |
| Operating revenue | $ 915,913 | 888,810 |
| Net Profit for the Current Operating Unit | $ 1,443 | 58,996 |
| Other comprehensive income | (4,793) | 6,507 |
| Total comprehensive income | $ (3,350) | 65,503 |
| Total comprehensive income attributable to non-controlling interests | $ - | - |
| Total comprehensive income attributable to the owners of the investee company | $ (3,350) | 65,503 |
| 2025 | 2024 | |
| The carrying amount of the Company's share in the net assets of associates at the beginning of the period. | $ 272,944 | - |
| Increase in the period | - | 272,944 |
| Total comprehensive income attributable to the Company for the period | (469) | - |
| Dividends received from affiliated enterprises for this period | (7,436) | - |
| The carrying amount of the Company's share in the net equity assets of associates at the end of the period. | $ 265,039 | 272,944 |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
(VIII) Property, plant and equipment
| Land | Buildings | Machinery equipment | Office equipment | Other equipment | Total | |
|---|---|---|---|---|---|---|
| Costs: | ||||||
| Balance as of January 1, 2025 | $ 286,508 | 368,027 | 323,918 | 21,443 | 191,904 | 1,191,800 |
| Addition | - | 1,100 | 9,124 | 840 | 3,843 | 14,907 |
| Disposal | - | - | (16,839) | (964) | - | (17,803) |
| Reclassification | - | - | - | - | 152 | 152 |
| Balance as of December 31, 2025 | $ 286,508 | 369,127 | 316,203 | 21,319 | 195,899 | 1,189,056 |
| Balance as of January 1, 2024 | $ 436,303 | 404,290 | 324,655 | 22,272 | 188,576 | 1,376,096 |
| Addition | - | - | 1,164 | - | 3,212 | 4,376 |
| Disposal | - | - | (2,218) | (829) | (2,080) | (5,127) |
| Reclassification | (149,795) | (36,263) | 317 | - | 2,196 | (183,545) |
| Balance as of December 31, 2024 | $ 286,508 | 368,027 | 323,918 | 21,443 | 191,904 | 1,191,800 |
| Accumulated depreciation: | ||||||
| Balance as of January 1, 2025 | $ - | 98,391 | 228,971 | 18,107 | 81,312 | 426,781 |
| Depreciation | - | 8,893 | 30,513 | 2,061 | 21,096 | 62,563 |
| Disposal | - | - | (16,839) | (964) | - | (17,803) |
| Balance as of December 31, 2025 | $ - | 107,284 | 242,645 | 19,204 | 102,408 | 471,541 |
| Balance as of January 1, 2024 | $ - | 99,051 | 197,180 | 16,042 | 60,522 | 372,795 |
| Depreciation | - | 8,725 | 34,009 | 2,894 | 21,801 | 67,429 |
| Disposal | - | - | (2,218) | (829) | (1,011) | (4,058) |
| Reclassification | - | (9,385) | - | - | - | (9,385) |
| Balance as of December 31, 2024 | $ - | 98,391 | 228,971 | 18,107 | 81,312 | 426,781 |
| Carrying amount: | ||||||
| December 31, 2025 | $ 286,508 | 261,843 | 73,558 | 2,115 | 93,491 | 717,515 |
| December 31, 2024 | $ 286,508 | 269,636 | 94,947 | 3,336 | 110,592 | 765,019 |
~37~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
(IX) Right-of-use assets
| Buildings | |
|---|---|
| Cost of right-of-use assets: | |
| Balance as of January 1, 2025 | $ 149,763 |
| Decrease | (14,275) |
| Balance as of December 31, 2025 | $ 135,488 |
| Balance as of January 1, 2024 (i.e., balance as of December 31, 2024) | $ 149,763 |
| Accumulated depreciation of right-of-use assets: | |
| Balance as of January 1, 2025 | $ 65,143 |
| Depreciation | 16,747 |
| Decrease | (14,275) |
| Balance as of December 31, 2025 | $ 67,615 |
| Balance as of January 1, 2024 | $ 46,810 |
| Depreciation | 18,333 |
| Balance as of December 31, 2024 | $ 65,143 |
| Carrying amount: | |
| December 31, 2025 | $ 67,873 |
| December 31, 2024 | $ 84,620 |
(X) Investment property
Investment properties of the Company are detailed as follows:
| Land | Buildings | Total | |
|---|---|---|---|
| Costs: | |||
| Balance as of January 1, 2025 (i.e., balance as of December 31, 2025) | $ 149,795 | 36,263 | 186,058 |
| Balance as of January 1, 2024 | $ - | - | - |
| Reclassification | 149,795 | 36,263 | 186,058 |
| Balance as of December 31, 2024 | $ 149,795 | 36,263 | 186,058 |
| Accumulated depreciation and impairment loss: | |||
| Balance as of January 1, 2025 | $ - | 11,177 | 11,177 |
| Depreciation for the current period | - | 1,791 | 1,791 |
| Balance as of December 31, 2025 | $ - | 12,968 | 12,968 |
| Balance as of January 1, 2024 | $ - | - | - |
| Depreciation for the current period | - | 1,792 | 1,792 |
| Reclassification | - | 9,385 | 9,385 |
| Balance as of December 31, 2024 | $ - | 11,177 | 11,177 |
| Carrying amount: | |||
| December 31, 2025 | $ 149,795 | 23,295 | 173,090 |
| December 31, 2024 | $ 149,795 | 25,086 | 174,881 |
| Fair value: | |||
| December 31, 2025 | $ 235,959 | ||
| December 31, 2024 | $ 284,935 |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
As of December 31, 2025 and 2024, the fair value of investment property was evaluated based on the market evidence of similar property transaction prices in the same region by the management, and the input value used in the fair value evaluation technology belonged to level 3.
(XI) Intangible assets
| Computer software | |
|---|---|
| Costs: | |
| Balance as of January 1, 2025 | $ 80,156 |
| Separate Acquisition | 1,208 |
| Balance as of December 31, 2025 | $ 81,364 |
| Balance as of January 1, 2024 | $ 73,579 |
| Separate Acquisition | 6,577 |
| Balance as of December 31, 2024 | $ 80,156 |
| Accumulated amortization: | |
| Balance as of January 1, 2025 | $ 70,853 |
| Amortization | 5,729 |
| Balance as of December 31, 2025 | $ 76,582 |
| Balance as of January 1, 2024 | $ 64,335 |
| Amortization | 6,518 |
| Balance as of December 31, 2024 | $ 70,853 |
| Carrying amount: | |
| Balance as of December 31, 2025 | $ 4,782 |
| Balance as of December 31, 2024 | $ 9,303 |
The amortization charges for intangible assets for the years ended December 31, 2025 and 2024 are reported sequentially in the statements of comprehensive income as follows:
| 2025 | 2024 | |
|---|---|---|
| Operating costs | $ 2,517 | 3,382 |
| Operating expenses | 3,212 | 3,136 |
| $ 5,729 | 6,518 |
~39~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
(XII) Short-term borrowings
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Unsecured bank loans | $ 680,000 | 1,000,000 |
| Unused lines of credit | $ 3,400,000 | 2,430,000 |
| Range of interest rate | 1.82%~1.86% | 1.89%~1.90% |
(XIII) Long-term borrowings
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Unsecured bank loans | $ 920,000 | 550,000 |
| Less: portion due within one year | 320,000 | 80,000 |
| $ 600,000 | 470,000 | |
| Unused lines of credit | $ 980,000 | 1,200,000 |
| Year of maturity | 2027~2028 | 2025~2026 |
| Range of interest rate | 1.88%~1.89% | 1.88%~1.92% |
(XIV) Lease liabilities
The carrying amount of the lease liabilities of the Company is as follows:
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Current | $ 14,101 | 17,166 |
| Non-current | $ 58,016 | 72,118 |
Please refer to Note VI (XXIV) Financial Risk Management for the maturity analysis of lease liabilities.
The amounts recognized in profit or loss are as follows:
| 2025 | 2024 | |
|---|---|---|
| Interest expense on lease liabilities | $ 912 | 1,130 |
| Short-term leases expenses and lease expenses of low-value assets | $ 2,113 | 406 |
The amounts recognized in the cash flow statement are as follows:
| 2025 | 2024 | |
|---|---|---|
| Total cash outflow for leases | $ 20,192 | 20,102 |
Important lease terms:
- Lease of houses and buildings
Regarding the houses and buildings leased by the Company as office premises, warehouses and plants, the lease terms are approximately three to ten years, some of which include the option to extend for the same period as the original contract at the end of the lease term.
~40~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
- Other leases
The leases under which the Company leases office equipment are short-term leases or leases of low-value assets, and the Company has elected to apply the exemption from the recognition requirement and not recognize the related right-of-use assets and lease liabilities.
(XV) Provisions - product warranty
| 2025 | 2024 | |
|---|---|---|
| Balance as of January 1 | $ 30,437 | 41,764 |
| Provisions increase for the period | 4,635 | 3,761 |
| Provision reverses for the period | (11,880) | (15,088) |
| Balance as of December 31 | $ 23,192 | 30,437 |
The warranty provisions for products of the Company is mainly related to the sales of industrial computer boards and systems, and the warranty reserve is estimated based on the historical warranty data of similar products.
(XVI) Employee benefits
- Defined benefit plans
The adjustment when the present value of the Company's defined benefit obligation is greater than the fair value of the plan assets is as follows:
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Present value of defined benefit obligation | $ 82,927 | 75,640 |
| Fair value of plan assets | (67,902) | (60,481) |
| Net defined benefit liabilities | $ 15,025 | 15,159 |
The defined benefit plans of the Company are allocated to the special account for labor pension reserves of the Bank of Taiwan. The pension payment for each employee subject to the Labor Standards Act is calculated based on the base obtained through service years and the average salary for the six months prior to retirement.
(1) Composition of plan assets
The pension funds allocated by the Company in accordance with the Labor Standards Act are administrated by the Bureau of Labor Funds, Ministry of Labor (hereinafter referred to as "BLF"). In accordance with the "Regulations on the Custody and Utilization of Income and Expenditure of Labor Pension Funds", the minimum income for the annual final distribution of the funds shall not be lower than the income calculated based on the two-year fixed deposit rate of the local bank.
As of December 31, 2025 and 2024, the balances in the special accounts for labor pension reserves of the Company in the Bank of Taiwan were NT$67,902 thousand and NT$60,481 thousand, respectively. Information on the use of
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
labor pension fund assets, including fund returns and fund asset allocation, can be found on the website of the BLF.
(2) Changes in the present value of defined benefit obligations
| 2025 | 2024 | |
|---|---|---|
| Defined benefit obligations as of January 1 | $ 75,640 | 74,844 |
| Current service cost and interest | 1,211 | 1,039 |
| Remeasurement of net defined benefit liabilities (assets) | ||
| — Actuarial gain or loss arising from experience adjustments | 4,700 | 4,968 |
| — Actuarial gain or loss arising from changes in financial assumptions | 1,696 | (1,714) |
| Benefits paid under the plan | (320) | (3,497) |
| Defined benefit obligations as of December 31 | $ 82,927 | 75,640 |
(3) Changes in fair value of plan assets
| 2025 | 2024 | |
|---|---|---|
| Fair value of plan assets as of January 1 | $ 60,481 | 55,715 |
| Interest income | 926 | 716 |
| Remeasurement of net defined benefit liabilities (assets) | ||
| — Compensation of plan assets (excluding current interest) | 4,300 | 5,010 |
| Amount contributed to the plan | 2,515 | 2,537 |
| Benefits paid under the plan | (320) | (3,497) |
| Fair value of plan assets as of December 31 | $ 67,902 | 60,481 |
(4) Change in asset ceiling effects
The Company did not have defined benefit plan asset ceiling effects in the years 2025 and 2024.
(5) Expenses recognized as profit or loss
| 2025 | 2024 | |
|---|---|---|
| Service costs for the current period | $ 77 | 105 |
| Net interest on net defined benefit liabilities (assets) | 208 | 218 |
| $ 285 | 323 | |
| Operating costs | $ 161 | 202 |
| Operating expenses | 124 | 121 |
| $ 285 | 323 |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
(6) Actuarial assumptions
The significant actuarial assumptions used by the Company at the reporting date to determine the present value of the defined benefit obligations are as follows:
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Discount rate | 1.250% | 1.500% |
| Future salary increases | 3.25% | 3.25% |
The Company expects to make a contribution of NT$2,525 thousand to the defined benefit plan within one year after the reporting date of the fiscal year 2025. The weighted average duration of the defined benefit plan is 8.3 years.
(7) Sensitivity analysis
The effect of changes in the main actuarial assumptions used on the present value of defined benefit obligations is as follows:
| Effect on defined benefit obligations | ||
|---|---|---|
| Increase by 0.25% | Decrease by 0.25% | |
| December 31, 2025 | ||
| Discount rate | $ (1,695) | 1,752 |
| Future salary increases | 1,690 | (1,644) |
| December 31, 2024 | ||
| Discount rate | (1,658) | 1,715 |
| Future salary increases | 1,657 | (1,611) |
The sensitivity analysis described above is based on analyzing the impact of changes in a single assumption while other assumptions remain unchanged. In practice, many hypothetical changes may be sequential. The sensitivity analysis is consistent with the method used to calculate the net defined benefit liabilities on the balance sheet date. The method and assumptions used to prepare the sensitivity analysis in the current period are the same as in the previous period.
- Defined contribution plans
The defined contribution plan of the Company is made in accordance with the provisions of the Labor Pension Act at a contribution rate of 6% of the monthly salary of the laborers to the individual pension account of the Bureau of Labor Insurance (BLI). There is no statutory or presumptive obligation to pay additional amount after the Company has made a defined contribution under these plans.
~44~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
The pension expenses under the defined pension contribution measures of the Company in 2025 and 2024 were NT$22,791 thousand and NT$22,238 thousand, respectively.
(XVII) Income taxes
1. Income tax expenses
The income tax expenses of the Company are detailed as follows:
| 2025 | 2024 | |
|---|---|---|
| Current income tax expense | ||
| Current income tax | $ 42,458 | 46,077 |
| Prior period adjustment of current income tax | 2,204 | 3,256 |
| Current income tax expense | 44,662 | 49,333 |
| Deferred income tax expenses | 16,765 | 30,558 |
| $ 61,427 | 79,891 |
The details of income tax benefits (expenses) recognized by the Company under other comprehensive income in 2025 and 2024 are as follows:
| 2025 | 2024 | |
|---|---|---|
| Items that will not be reclassified to profit or loss: | ||
| Remeasurement of defined benefit plans | $ 419 | (351) |
The reconciliation of income tax expenses and income before tax was as follows:
| 2025 | 2024 | |
|---|---|---|
| Net profit before tax | $ 346,792 | 476,502 |
| Income tax at the Company's domestic tax rate | $ 69,358 | 95,300 |
| Loss (gain) on domestic investment recognized under equity method | (9,710) | (18,473) |
| Prior period adjustment of income tax | 2,204 | 3,256 |
| Other tax-exempt income | - | (911) |
| Others | (425) | 719 |
| $ 61,427 | 79,891 |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
- Deferred income tax assets and liabilities
(1) Deferred income tax assets and liabilities recognized
The changes in deferred tax assets and liabilities are as follows:
Deferred income tax assets:
| Allowance for inventory loss | Provisions | Net defined benefit liabilities | Unrealized gross profit on sales between affiliated companies | Others | Total | |
|---|---|---|---|---|---|---|
| January 1, 2025 | $ 23,773 | 6,088 | 2,214 | 4,077 | 621 | 36,773 |
| (Debit) Credit income statement | (8,167) | (1,449) | (446) | 2,687 | (392) | (7,767) |
| (Debit) Credit to other comprehensive income | - | - | 419 | - | - | 419 |
| December 31, 2025 | $ 15,606 | 4,639 | 2,187 | 6,764 | 229 | 29,425 |
| January 1, 2024 | $ 26,105 | 8,353 | 3,008 | 14,031 | 2,433 | 53,930 |
| (Debit) Credit income statement | (2,332) | (2,265) | (443) | (9,954) | (1,812) | (16,806) |
| (Debit) Credit to other comprehensive income | - | - | (351) | - | - | (351) |
| December 31, 2024 | $ 23,773 | 6,088 | 2,214 | 4,077 | 621 | 36,773 |
Deferred income tax liabilities:
| Temporary differences related to investment in subsidiaries | Difference between finance and taxes from fixed assets | Others | Total | |
|---|---|---|---|---|
| January 1, 2025 | $ 107,054 | 696 | 1,289 | 109,039 |
| (Debit) Credit income statement | 10,983 | (696) | (1,289) | 8,998 |
| December 31, 2025 | $ 118,037 | - | - | 118,037 |
| January 1, 2024 | $ 92,992 | 696 | 1,599 | 95,287 |
| (Debit) Credit income statement | 14,062 | - | (310) | 13,752 |
| December 31, 2024 | $ 107,054 | 696 | 1,289 | 109,039 |
- The Company's profit-seeking enterprise income tax has been approved by the tax authority for the year 2023.
(XVIII) Capital and other equities
- Share capital - Ordinary shares
As of December 31, 2025 and 2024, the total authorized capital of the Company was NT$1,772,000 thousand, which was divided into 177,200 thousand shares at NT$10 per share. The number of issued shares were both 114,489 thousand shares. The
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
reserved capital for issuance of stock options to employees in the authorized share capital is 20,000 thousand shares.
2. Capital surplus
The Company's capital reserve balance is analyzed as follows:
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Share premium | $ 599,203 | 599,203 |
| Differences between the actual price for acquisition or disposal of the subsidiaries and their carrying amount | 183,410 | 183,410 |
| Recognized changes in percentage of ownership interests in subsidiaries | 90,748 | 90,577 |
| Gain on asset disposal | 808 | 808 |
| Others | 24,703 | 24,133 |
| $ 898,872 | 898,131 |
In accordance with the Company Act, the capital reserve must first be used to cover deficits before new shares or cash can be issued in proportion to the shareholders' original shares. If the foregoing is paid in cash, the Board of Directors shall be authorized to make a resolution and report to the shareholders' meeting. The realized capital surplus as termed in the preceding sentence includes the proceeds from the shares issued at a premium over the face value and the income from the acceptance of donations. Pursuant to the provision of Regulations Governing the Offering and Issuance of Securities by Securities Issuers, the capital surplus shall be accrued out of the capital, and the total amount accrued every year shall be no higher than ten percent of the paid-in capital.
3. Retained earnings and dividend policy
Under the provision of the Articles of Association of the Company, if there are any earnings in the final settlement, it shall first accrue the tax, make up the accumulated loss, and then set aside 10% as the legal surplus reserve, except when the legal surplus reserve has reached the paid-in capital of the Company. If there are any earnings after the special surplus reserve is set aside or reversed in accordance with the law, the Board of Directors shall formulate the earnings distribution proposal together with the accumulated unappropriated earnings and submit them to the Shareholders' Meeting for dividend distribution. The Board of Directors is authorized to make a resolution to distribute and report to the Shareholders' Meeting if the earnings distribution shall be in the form of cash dividends.
According to the Articles of Association of the Company, due to the fierce competition in the industry, the volatile environment, and the stable growth stage of
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
the Company's life cycle, to effectively master the Company's future investment opportunities, working capital needs, and long-term financial planning, and to meet shareholders' cash inflow needs, the Board of Directors formulates the earnings distribution proposal should take into account the general distribution level of the relevant industry and adopt a balanced dividend policy, and distribute according to the principle of prudence. If the Company's annual final settlement has earnings of 2% of the capital, the dividend distribution should not be less than 10% of the distributable earnings for the year, and the proportion of cash dividends paid each year should not be less than 10% of the total of cash and stock dividends paid for the year.
(1) Legal reserve
Pursuant to the provision of the Company Act, when the Company makes no loss, it may, by resolution of the Shareholders' Meeting, distribute the legal surplus reserve in the form of new shares or in cash to the extent that such legal reserve exceeds 25% of the total paid-in capital. If the aforementioned is done in cash, is authorized to be resolved by the Board of Directors and reported to the Shareholders' Meeting.
(2) Special reserve
Under the regulations issued by the Financial Supervisory Commission, when distributing the distributable earnings, for the net deductibles of other shareholders' equity incurred in the current year, the Company shall accrue the special surplus reserve in the same amount out of the amount of current after-tax net income added to the current unappropriated earnings, including items other than current after-tax net income and the unappropriated earnings in the previous period, and for the deductibles of other shareholders' equity accumulated in the previous period, the Company shall not distribute the special surplus reserve in the same amount accrued out of the unappropriated earnings in the previous period. If deductibles of other shareholders' equity are reversed in future, the reversed portion may be distributed as earnings.
- Distribution of earnings
On February 25, 2025, and March 4, 2024, the Board of Directors of the Company resolved the amount of cash dividends and distribution amounts for the years ended December 31, 2024 and 2023, respectively. On May 22, 2025, and May 31, 2024, the annual shareholders' meeting resolved the other earnings distribution proposal for the years ended December 31, 2024 and 2023, respectively. The relevant distribution amounts were as follows:
~47~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
| 2024 | 2023 | |||
|---|---|---|---|---|
| Dividend per share (NT$) | Amount | Dividend per share (NT$) | Amount | |
| Legal reserve | $ 43,858 | 36,913 | ||
| Special reserve | $ 13,775 | 17,750 | ||
| Dividends distributed to owners of common stock: | ||||
| Cash dividends | 3.4 | 389,262 | 3.0 | 343,467 |
On March 3, 2026, the Board of Directors resolved to distribute the following cash dividends from the 2025 earnings:
| 2025 | ||
|---|---|---|
| Dividend per share (NT$) | Amount | |
| Dividends distributed to owners of common stock: | ||
| Cash dividends | $ 2.45 | 280,498 |
The information regarding the earnings distribution can be found on the MOPS (Market Observation Post System).
- Other equities (net amount after tax)
| Exchange differences on translating the financial statements of foreign operations | Unrealized gain (loss) on financial assets at fair value through other comprehensive income | Total | |
|---|---|---|---|
| Balance as of January 1, 2025 | $ (70,975) | 1,409 | (69,566) |
| Exchange difference from conversion of net assets of foreign operating organizations | 1,068 | - | 1,068 |
| Shares of other comprehensive income of subsidiary and associates accounted for using the equity method | - | (5,193) | (5,193) |
| Balance as of December 31, 2025 | $ (69,907) | (3,784) | (73,691) |
| Balance as of January 1, 2024 | $ (97,599) | 41,808 | (55,791) |
| Exchange difference from conversion of net assets of foreign operating organizations | 26,356 | - | 26,356 |
| Unrealized gain (loss) on financial assets at fair value through other comprehensive income | - | (1,419) | (1,419) |
| Share of other comprehensive income of the subsidiary recognized using the equity method | - | (284) | (284) |
| Disposal of partial ownership interests in subsidiaries | 268 | (49) | 219 |
| Disposal of equity instruments measured at fair value through other comprehensive income | - | (38,647) | (38,647) |
| Balance as of December 31, 2024 | $ (70,975) | 1,409 | (69,566) |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
(XIX) Earnings per share
- Basic earnings per share
| 2025 | 2024 | |
|---|---|---|
| Net profit attributable to ordinary shareholders of the Company | $ 285,365 | 396,611 |
| Weighted average number of outstanding ordinary shares (in thousands of shares) | 114,489 | 114,489 |
| Basic earnings per share (NT$) | $ 2.49 | 3.46 |
- Diluted earnings per share
| 2025 | 2024 | |
|---|---|---|
| Net profit attributable to ordinary shareholders of the Company | $ 285,365 | 396,611 |
| Weighted average number of outstanding ordinary shares (in thousands of shares) | 114,489 | 114,489 |
| Effects of potential ordinary shares with dilution effect (in thousands of shares): | ||
| Effects of employee stock compensation | 501 | 581 |
| Weighted average number of outstanding ordinary shares (after adjusting for the dilutive effect of potential ordinary shares) (in thousands of shares) | 114,990 | 115,070 |
| Diluted earnings per share (NT$) | $ 2.48 | 3.45 |
(XX) Revenue from customer contracts
- Breakdown of revenue
| 2025 | 2024 | |
|---|---|---|
| Main products and services: | ||
| Industrial computer cards and system | $ 3,475,315 | 2,977,634 |
| Others | 285,201 | 244,614 |
| $ 3,760,516 | 3,222,248 |
- Balance of contracts
| 2025.12.31 | 2024.12.31 | 2024.1.1 | |
|---|---|---|---|
| Notes and accounts receivable (including related parties) | $ 504,121 | 601,340 | 438,840 |
| Less: Allowance for loss | (2,552) | (679) | (921) |
| $ 501,569 | 600,661 | 437,919 | |
| Contract liabilities | $ 19,420 | 12,090 | 10,732 |
For the disclosure of notes receivable, accounts receivable (including related parties) and their impairments, please see Note VI (V) for details.
The contract liabilities mainly come from the difference between the time point of satisfying the performance obligation when the Company transfers goods to a customer and the time point of the customer's payment. The beginning balances of contract liabilities as of January 1, 2025 and 2024 were recognized as income of
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
NT$10,398 thousand and NT$7,976 thousand, respectively, for the years ended December 31, 2025 and 2024.
(XXI) Compensation of employees and directors
On May 22, 2025, the Company’s shareholders resolved to amend the Articles of Incorporation. Pursuant to the amended Articles, if the Company has profits in a given fiscal year, 5% and 20% of such profits shall be allocated as employee compensation, and no more than 1% for director compensation. Of the employee compensation, the distribution of compensation for entry-level employees shall not be less than 10% of the total employee compensation mentioned above. But if the Company still has an accumulated loss, a certain amount should be reserved in advance for offsetting. Under the Articles of Incorporation prior to the amendment, the Company shall set aside at least 5-20% of the earnings, if any, in the year as compensation to the employees and no greater than 1% as compensation to directors. But if the Company still has an accumulated loss, a certain amount should be reserved in advance for offsetting. The beneficiaries of the aforesaid employees' compensation, if distributed in stock or in cash, shall include the employees of the controlled companies or affiliates of the Company who meet certain conditions.
For the years ended December 31, 2025 and 2024, the estimated employee compensations of the Company were NT$26,315 thousand and NT$36,219 thousand, respectively, and the estimated director compensations were NT$2,820 thousand and NT$3,878 thousand, respectively, which were estimated based on the Company's pre-tax net income before deducting the compensations for employees and directors multiplied by the Company's proposed distribution rate of compensations for employees and directors for each period, and were reported as operating costs or operating expenses for each such period. If the actually distributed amount of next year is different from the estimate, the difference will be treated as an accounting estimate change and listed in the profit and loss of next year.
The amounts of compensations for employees and directors of the Company as of March 3, 2026 and February 25, 2025, as determined by the Board of Directors, are not different from the amounts estimated in the Company's parent company only financial statements for the fiscal years 2025 and 2024, and are paid entirely in cash. The relevant information can be found in the MOPS.
~50~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
(XXII) Non-operating income and expenses
- Interest income
| 2025 | 2024 | |
|---|---|---|
| Interest on bank deposit | $ 5,840 | 6,713 |
| Interest income from financial assets measured at amortized cost | 25 | 186 |
| Interest on deposits | 14 | 13 |
| Interest income from financial assets at fair value through profit or loss | 638 | 570 |
| $ 6,517 | 7,482 |
- Other income
| 2025 | 2024 | |
|---|---|---|
| Rental income | $ - | 4,523 |
| Dividend income | - | 4,555 |
| Others | 18,711 | 18,284 |
| $ 18,711 | 27,362 |
- Other gains and losses
| 2025 | 2024 | |
|---|---|---|
| Gain (loss) on disposal of property, plant and equipment | 170 | (88) |
| Net gain (loss) on foreign exchange | (12,099) | 21,440 |
| Net gain (loss) on financial instruments at fair value through profit or loss | 9,971 | (54,769) |
| Other expenses (gains) | (6) | 2,423 |
| $ (1,964) | (30,994) |
- Finance costs
| 2025 | 2024 | |
|---|---|---|
| Bank interest expenses | $ 28,045 | 21,656 |
| Financial expenses on lease liabilities | 912 | 1,130 |
| $ 28,957 | 22,786 |
~51~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
(XXIII) Financial instruments
- Types of financial instruments
(1) Financial assets
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Financial assets at fair value through profit or loss - current | $ 21,007 | 22,457 |
| Financial assets at fair value through profit or loss - non-current | 20,000 | - |
| Financial assets measured at amortized cost: | ||
| Cash and cash equivalents | 300,623 | 418,043 |
| Financial assets at amortized cost - current | 1,500 | 1,500 |
| Notes receivable, accounts receivable, and other receivables (including related parties) | 519,387 | 626,743 |
| Refundable deposits (reported in other non-current assets) | 891 | 891 |
| Subtotal | 822,401 | 1,047,177 |
| Total | $ 863,408 | 1,069,634 |
(2) Financial liabilities
| 2025.12.31 | 2024.12.31 | |
|---|---|---|
| Financial liabilities measured at fair value through profit or loss: | ||
| Held for trading | $ 1,160 | 3,751 |
| Financial liabilities measured at amortized cost: | ||
| Short-term borrowings | 680,000 | 1,000,000 |
| Accounts payable and other payables (including related parties) | 963,502 | 818,447 |
| Long-term borrowings (including those due within one year) | 920,000 | 550,000 |
| Lease liabilities (including current and non-current) | 72,117 | 89,284 |
| Subtotal | 2,635,619 | 2,457,731 |
| Total | $ 2,636,779 | 2,461,482 |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
2. Fair value
(1) Financial instruments not measured at fair value
The management of the Company believes that the carrying amounts of the financial assets and liabilities of the Company classified as amortized cost in the parent company only financial statements are close to their fair value.
(2) Financial instruments measured at fair value
The Company’s financial assets/liabilities measured by fair value through profit and loss and the financial assets measured by fair value through other comprehensive profit and loss are measured by fair value on the basis of repeatability. The following table provides relevant analysis of the financial instruments measured at fair value after initial recognition and classifies these assets into levels 1 to 3 based on the observable extent of fair value. Different fair value levels are defined as follows:
A. Level 1: Open quotation of the same asset or liability in the active market (without adjustment).
B. Level 2: The input parameter of the asset or liability is directly observable (namely price) or indirectly observable (namely, inferred from price), except for the open quotations included in level 1.
C. Level 3: The input parameters of assets or liabilities are not based on observable market data (non-observable parameters).
| 2025.12.31 | ||||
|---|---|---|---|---|
| Fair value | ||||
| Level 1 | Level 2 | Level 3 | Total | |
| Financial assets measured at fair value through profit or loss: | ||||
| Derivative financial instruments - Forward foreign exchange contracts | $ - | 98 | - | 98 |
| Derivative financial instruments - Foreign exchange swaps contract | - | 144 | - | 144 |
| Fund beneficiary certificates | 20,765 | - | - | 20,765 |
| Stocks of domestic unlisted companies | - | - | 20,000 | 20,000 |
| $ 20,765 | 242 | 20,000 | 41,007 | |
| Financial liabilities measured at fair value through profit or loss: | ||||
| Derivative financial instruments - Forward foreign exchange contracts | $ - | 346 | - | 346 |
| Derivative financial instruments - Foreign exchange swaps contracts | - | 814 | - | 814 |
| Subtotal | $ - | 1,160 | - | 1,160 |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
| 2024.12.31 | ||||
|---|---|---|---|---|
| Fair value | ||||
| Level 1 | Level 2 | Level 3 | Total | |
| Financial assets measured at fair value through profit or loss: | ||||
| Derivative financial instruments - Forward foreign exchange contracts | $ - | 322 | - | 322 |
| Fund beneficiary certificates | 22,135 | - | - | 22,135 |
| $ 22,135 | 322 | - | 22,457 | |
| Financial assets measured at fair value through other comprehensive income: | ||||
| Financial liabilities measured at fair value through profit or loss: | ||||
| Derivative financial instruments - Forward foreign exchange contracts | $ - | 649 | - | 649 |
| Derivative financial instruments - Foreign exchange swaps contracts | - | 3,102 | - | 3,102 |
| Subtotal | $ - | 3,751 | - | 3,751 |
(3) Fair value measurement techniques for financial instruments measured at fair value
A. Non-derivative financial instruments
If there is an open quotation for the financial instrument in the active market, the open quotation in the active market shall be the fair value.
Except for financial instruments with active markets, fair values of the other financial instruments are obtained with valuation techniques or counterparty quotations. Evaluation technique-based fair value may be calculated by referring to the current fair value of other financial instruments with similar substantial conditions and characteristics, or discounted cash flow or other evaluation techniques, including market information application mode available on the reporting date.
The fair values of the financial instruments held by the Company are presented in terms of type and attribute as follows:
TWSE/TPEx listed stocks and fund beneficiary certificates have standard terms and conditions and are traded in active markets, and their fair values are determined in accordance with market quotations.
~54~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
For financial instruments held by the Company, such as unlisted stocks with no active market, the fair value is primarily estimated using the market approach, based on factors such as the net worth, operational status, and the total market value of the individual assets and liabilities of the evaluated company. In addition, the main unobservable input is the liquidity discount. However, since potential fluctuations in the liquidity discount would not have a significant financial impact, its quantitative information will not be disclosed.
B. Derivative financial instruments
They are valuated with the valuation model generally accepted by market participants. Forward foreign exchange contracts and foreign exchange swap contracts are usually valuated in line with the current forward exchange rate.
(4) Transfer between fair value levels
There were no transfers of fair value levels of any financial asset and financial liability for the years ended 2025 and 2024.
(5) Detailed statement on changes in level 3
Financial assets measured at fair value through profit or loss:
| 2025 | 2024 | |
|---|---|---|
| Beginning balance | $ - | - |
| Addition in current period | 20,000 | - |
| Ending balance | $ 20,000 | - |
(XXIV) Financial risk management
The Company is exposed to credit risk, liquidity risk and market risk (including exchange rate risk, interest rate risk and equity instrument price risk) as a result of its business activities. This Note presents the Company's policies and procedures for measuring and managing each of these risks and the quantitative disclosure of the risks.
The Company's Board of Directors is responsible for developing and controlling the Company's risk management policy. The risk management policy is established to identify and analyze the risks faced by the Company, set appropriate risk limits and controls, and monitor compliance with the risks and risk limits. Risk management policies and systems are periodically reviewed to reflect changes in market conditions and the operations of the Company.
The financial management department of the Company monitors and manages the financial risks related to the operations of the Company through internal risk reports.
- Credit risk
Credit risk refers to the risk of financial losses incurred by the Company due to the failure of counterparties to perform contractual obligations with respect to financial
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
assets, mainly arising from financial assets such as cash and equivalents, derivative instrument transactions, accounts receivable from customers, and other receivables. The carrying value of financial assets of the Company represents the maximum exposure amount.
The transaction counterparties of cash and cash equivalents of the Company and the beneficiary certificates of the fund held by the Company are all financial institutions with good credit and therefore should not generate significant credit risk.
The policies adopted by the Company are to only conduct transactions with reputed counterparties, and to obtain sufficient collateral under necessary circumstances to reduce the risk of financial losses. The Company conducts transactions with enterprises whose ratings is equivalent to or higher than investment level. The information is provided by independent rating agencies. If such information is not available, the Company will use other publicly available financial information and transaction records of each other to rate major clients. The Company continuously monitors credit exposure and the credit ratings of its counterparties, and distributes the total transaction amount to qualified customers with credit ratings. It controls credit exposure through counterparty credit limit limits reviewed and approved by the risk management unit annually, and also reduces possible losses through insurance.
To mitigate the credit risk, the management of the Company appoints a team solely responsible for determination of credit lines, credit approvals and other monitoring procedures to ensure that appropriate action has been taken for the collection of overdue receivables. In addition, the Company will review the recoverable amount of the receivables one by one on the balance sheet date to ensure that the unrecoverable receivables have been recognized with appropriate impairment loss. Accordingly, the management of the Company believes that the Company's credit risk is significantly reduced.
The Company does not significantly concentrate on transactions with a single external customer; therefore, there is no concentration of credit risk on accounts receivable.
- Liquidity risk
Liquidity risk refers to the risk that the Company cannot deliver cash or other financial assets to settle financial liabilities and fails to fulfill relevant obligations. The Company manages and maintains sufficient cash positions to support operations and mitigate the impact of cash flow fluctuations. The management of the Company monitors the use of bank facility and ensures compliance with the terms of the loan contract.
The following table shows the contractual maturity dates of financial liabilities, including the impact of estimated interest, based on the earliest date on which the Company may be required to repay and using undiscounted cash flow.
~56~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
| Contractual cash flows | Within 1 year | 1-2 years | 2-5 years | 5 years and above | |
|---|---|---|---|---|---|
| December 31, 2025 | |||||
| Non-derivative financial liabilities: | |||||
| Short-term borrowings (floating rates) | $ 681,482 | 681,482 | - | - | - |
| Long-term borrowings (floating rates) | 941,132 | 334,694 | 444,871 | 161,567 | - |
| Accounts payable and other payables (including related parties) | 963,502 | 963,502 | - | - | - |
| Lease liabilities | 74,197 | 14,839 | 14,839 | 43,282 | 1,237 |
| Subtotal | 2,660,313 | 1,994,517 | 459,710 | 204,849 | 1,237 |
| Derivative financial instruments: | |||||
| Forward foreign exchange contracts - gross delivery | |||||
| Outflow | 139,690 | 139,690 | - | - | - |
| Inflow | (139,442) | (139,442) | - | - | - |
| Foreign exchange SWAP contracts - gross delivery | |||||
| Outflow | 252,834 | 252,834 | - | - | - |
| Inflow | (252,164) | (252,164) | - | - | - |
| Total | 918 | 918 | - | - | - |
| $ 2,661,231 | 1,995,435 | 459,710 | 204,849 | 1,237 | |
| December 31, 2024 | |||||
| Non-derivative financial liabilities: | |||||
| Short-term borrowings (floating rates) | $ 1,000,933 | 1,000,933 | - | - | - |
| Long-term borrowings (floating rates) | 564,486 | 89,915 | 474,571 | - | - |
| Accounts payable and other payables (including related parties) | 818,447 | 818,447 | - | - | - |
| Lease liabilities | 92,275 | 18,078 | 14,839 | 43,282 | 16,076 |
| Subtotal | 2,476,141 | 1,927,373 | 489,410 | 43,282 | 16,076 |
| Derivative financial instruments: | |||||
| Forward foreign exchange contracts - gross delivery | |||||
| Outflow | 135,471 | 135,471 | - | - | - |
| Inflow | (135,144) | (135,144) | - | - | - |
| Foreign exchange SWAP contracts - gross delivery | |||||
| Outflow | 353,694 | 353,694 | - | - | - |
| Inflow | (350,592) | (350,592) | - | - | - |
| Subtotal | 3,429 | 3,429 | - | - | - |
| Total | $ 2,479,570 | 1,930,802 | 489,410 | 43,282 | 16,076 |
The Company doesn't expect the time point of the cash flow under the maturity date analysis will come much earlier or the actual amount will be substantially different.
~57~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
- Market risk
Market risk refers to the risk that changes in market prices, such as exchange rates, interest rates and the price of equity instruments, and may affect the earnings of the Company or the value of the financial instruments it holds. The goal of market risk management is to control the degree of exposure to market risk within an acceptable range, and to optimize investment returns.
(1) Exchange rate risk
The Company is exposed to the risk of exchange rate fluctuations arising from sales and purchase transactions denominated in non-functional currencies, which are primarily denominated in USD. The management of exchange rate risk of the Company involves using forward foreign exchange contracts and foreign exchange contracts to manage exchange rate risk to the extent permitted by policy.
The exchange rate risk of the Company mainly stems from the USD-denominated receivables and payables that are still outstanding at the balance sheet date. The sensitivity analysis of the carrying values of significant monetary assets and liabilities that are not denominated in functional currencies and their related foreign currency movements on the reporting date is as follows in thousands of NTD:
| 2025.12.31 | |||||
|---|---|---|---|---|---|
| Foreign currency | Exchange rate | NTD | Exchange rate fluctuation | Profit and loss influence (before tax) | |
| Financial assets | |||||
| Monetary items | |||||
| USD | $ 24,432 | 31.4300 | 767,903 | 1% | 7,679 |
| Financial liabilities | |||||
| Monetary items | |||||
| USD | 17,685 | 31.4300 | 555,837 | 1% | 5,558 |
| 2024.12.31 | |||||
| Foreign currency | Exchange rate | NTD | Exchange rate fluctuation | Profit and loss influence (before tax) | |
| Financial assets | |||||
| Monetary items | |||||
| USD | $ 22,605 | 32.7850 | 741,102 | 1% | 7,411 |
| Financial liabilities | |||||
| Monetary items | |||||
| USD | 13,018 | 32.7850 | 426,798 | 1% | 4,268 |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
Due to the wide variety of monetary items of the Company, the exchange gain or loss of monetary items are disclosed through consolidation. Please refer to Note VI (XXII) for details of foreign currency exchange (loss) gain (including realized and unrealized) for the years 2025 and 2024.
(2) Interest rate risk
The bank borrowings of the Company are based on a floating rate basis. The measures taken by the Company to address the risk of interest rate changes mainly include regularly assessing the borrowing interest rate of banks, maintaining good relationship with financial institutions to achieve lower financing costs, and strengthening working capital management to reduce the dependence on bank borrowings and the risk of interest rate changes.
The interest rate exposure of financial liabilities of the Company is described in the liquidity risk management section of this Note. The following sensitivity analysis is based on the interest rate exposure of non-derivative instruments at the reporting date. For floating rate liabilities, the analysis assumes that the amount of liabilities outstanding at the reporting date is outstanding throughout the year. The rate of change used by the Company to report interest rates to the main management is an increase or decrease of 1% in annual interest rates, which also represents the management's assessment of the reasonable and possible range of changes in interest rates.
If the annual interest rate on bank borrowings of the Company increases/decreases by 1%, and all other variables remain unchanged, based on the estimated balance of bank borrowings of the Company as of December 31, 2025 and 2024, the income before tax of the Company for the years 2025 and 2024 will increase/decrease by NT$16,000 thousand and NT$15,500 thousand, respectively.
(XXV) Capital management
The Company manages its capitalization to ensure that the Company will be able to continue as going concern while maximizing the return to stakeholders through the optimization of the debt and equity balance.
The capital structure of the Company consists of the net debt (i.e., borrowings less cash and cash equivalents) and equity (i.e., capital stock, capital reserve, retained earnings and other equity items) of the Company. The Company is not subject to other external capital requirements.
~59~
~60~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
The Company's key management annually reviews the Company's capital structure, and the content of the review includes costs of various capital and related risks. According to the key management's suggestions, the Company will balance the overall capital structure through the payment of dividends, issuance of new shares, and buy-back of shares.
The way of capital management of the Company did not change in 2025 and 2024.
(XXVI) Non-cash transactions in investing and financing activities
- Please refer to Note VI (IX) for the right-of-use assets acquired by the Company through lease.
- The liabilities arising from financing activities are reconciled in the following table:
| 2025.1.1 | Cash flows | 2025.12.31 | |
|---|---|---|---|
| Short-term borrowings | $ 1,000,000 | (320,000) | 680,000 |
| Long-term borrowings (including those due within one year) | 550,000 | 370,000 | 920,000 |
| Lease liabilities | 89,284 | (17,167) | 72,117 |
| Total liabilities from financing activities | $ 1,639,284 | 32,833 | 1,672,117 |
| 2024.1.1 | Cash flows | 2024.12.31 | |
| Short-term borrowings | $ 650,000 | 350,000 | 1,000,000 |
| Long-term borrowings (including those due within one year) | 400,000 | 150,000 | 550,000 |
| Lease liabilities | 107,850 | (18,566) | 89,284 |
| Total liabilities from financing activities | $ 1,157,850 | 481,434 | 1,639,284 |
VII. Related Party Transactions
(I) Parent company and ultimate controller
Qisda Corporation is the ultimate controller of the parent company and affiliated group of the Company, directly or indirectly holding 55.09% of the Company's outstanding ordinary shares. Qisda has prepared consolidated financial reports for public use.
(II) Names and relationships of related parties
During the period covered by the parent company only financial statements, the Company's parent company, subsidiaries, and other related parties that have transactions with the Company are as follows:
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
| Name of related party | Relationship with the Company |
|---|---|
| Qisda Corporation (Qisda) | Parent company of the Company |
| DFI AMERICA, LLC. | Subsidiary directly or indirectly held by the Company |
| DFI Co., Ltd. | Subsidiary directly or indirectly held by the Company |
| Yan Tong Technology Ltd. | Subsidiary directly or indirectly held by the Company |
| Diamond Flower Information (NL) B.V. | Subsidiary directly or indirectly held by the Company |
| Yan Ying Hao Trading (Shenzhen) Co., Ltd. (Yan Ying Hao) | Subsidiary directly or indirectly held by the Company |
| AEWIN Technologies Co., Ltd. (AEWIN) | Subsidiary directly or indirectly held by the Company |
| Aewin Beijing Technologies Co., Ltd. | Subsidiary directly or indirectly held by the Company |
| Wise way international CO., LTD. (Wise way) | Subsidiary directly or indirectly held by the Company |
| Bright profit enterprise Limited (Bright profit) | Subsidiary directly or indirectly held by the Company |
| Aewin (Shenzhen) Technologies Co., Ltd | Subsidiary directly or indirectly held by the Company (Note 1) |
| Ace Pillar Co., Ltd. | Subsidiary directly or indirectly held by the Company |
| Tianjin Ace Pillar Co., Ltd. | Subsidiary directly or indirectly held by the Company |
| Transpak Equipment Corporation | Subsidiary directly or indirectly held by the Company |
| ACE Energy Co., Ltd | Subsidiary directly or indirectly held by the Company |
| Cyber South Management Ltd. (Cyber) | Subsidiary directly or indirectly held by the Company |
| Hong Kong Ace Pillar Enterprise Ltd (Hong Kong ACE Pillar) | Subsidiary directly or indirectly held by the Company (Note 2) |
| Suzhou Super Pillar Automation Equipment Co., Ltd. (Suzhou Super Pillar) | Subsidiary directly or indirectly held by the Company |
| Proton Inc. (Proton) | Subsidiary directly or indirectly held by the Company |
| Ace Tek (HK) Holding Co., Ltd. (ACE Tek) | Subsidiary directly or indirectly held by the Company |
| Grace Transmission (Tianjin) Co., Ltd. (Grace Transmission) | Subsidiary directly or indirectly held by the Company (Note 3) |
| Advancedtek Ace (TJ) Inc. (Advancedtek Ace) | Subsidiary directly or indirectly held by the Company |
| Standard Technology Corporation (Standard Co.) | Subsidiary directly or indirectly held by the Company |
| Standard International Trading (Shanghai) Co., Ltd. (Shanghai Standard) | Subsidiary directly or indirectly held by the Company |
| Standard Technology Corp. (BVI) | Subsidiary directly or indirectly held by the Company |
| Blue Walker GmbH (BWA) | Subsidiary directly or indirectly held by the Company |
| APLEX Technology Inc. | Associate of the Company (Note 4) |
| Other related parties: | |
| Partner Technology Co., Ltd. | Subsidiaries directly or indirectly held by Qisda |
| Partner Tech Asia Pacific | Subsidiaries directly or indirectly held by Qisda |
| Alpha Networks Inc. | Subsidiaries directly or indirectly held by Qisda |
| BenQ Materials Corp. | Subsidiaries directly or indirectly held by Qisda |
| BenQ Asia Pacific Corp. | Subsidiaries directly or indirectly held by Qisda |
| BenQ Corporation | Subsidiaries directly or indirectly held by Qisda |
| Epic Cloud Co.,Ltd. | Subsidiaries directly or indirectly held by Qisda |
| Simula Technology Inc. | Subsidiaries directly or indirectly held by Qisda |
| Golden Spirit Co., Ltd. | Subsidiaries directly or indirectly held by Qisda |
| Data Image Corporation | Subsidiaries directly or indirectly held by Qisda |
~61~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
| Name of related party | Relationship with the Company |
|---|---|
| Metaage Corporation | Subsidiaries directly or indirectly held by Qisda |
| AdvancedTEK International Corp. | Subsidiaries directly or indirectly held by Qisda |
| DIVA Laboratories, Ltd. | Subsidiaries directly or indirectly held by Qisda |
| Metaguru Corporation | Subsidiaries directly or indirectly held by Qisda |
| Global Intelligence Network Co., Ltd. | Subsidiaries directly or indirectly held by Qisda |
| Action Star Technology Co., Ltd. | Subsidiaries directly or indirectly held by Qisda |
| Qisda Electronics (Suzhou) Co. Ltd. | Subsidiaries directly or indirectly held by Qisda |
| Qisda Optronics (Suzhou) Co., Ltd. | Subsidiaries directly or indirectly held by Qisda |
| Qisda (Suzhou) Co. Ltd. | Subsidiaries directly or indirectly held by Qisda |
| Brainstorm Corporation | Subsidiaries directly or indirectly held by Qisda |
| Qisda Vietnam Co., Ltd. | Subsidiaries directly or indirectly held by Qisda |
| Marketop Smart Solutions Co., Ltd. | Associates of Qisda |
| BenQ Foundation | Substantial related party of Qisda |
| AUO Corporation (AUO) | Company valuing Qisda under equity approach |
| AUO Digitech Taiwan Inc. | Subsidiary directly or indirectly held by AUO |
| Darwin Precisions Corporation | Subsidiary directly or indirectly held by AUO |
| AUO Display Plus Corp. | Subsidiary directly or indirectly held by AUO |
| Darfon Electronics Corporation (Darfon) | Associates of Qisda |
| Unictron Technologies Corporation | Subsidiaries directly or indirectly held by Darfon |
| Aplex Singapore Pte Ltd | Other related parties (Associate of APLEX) |
Note 1: Aewin (Shenzhen) has been fully liquidated in June, 2024 and deregistration has been completed in July, 2024.
Note 2: The cancellation procedures for Hong Kong Ace Pillar were completed in February 2024.
Note 3: Grace Transmission Co., Ltd. completed its liquidation in January 2024.
Note 4: Starting from December 24, 2024, became an associate of the Company.
(III) Material transactions with related party
- Net operating income
The material sales amount of the Company to the related parties is as follows:
| 2025 | 2024 | |
|---|---|---|
| Parent company | $ 230,179 | 115,635 |
| Subsidiary - DFI AMERICA, LLC. | 503,837 | 474,799 |
| Subsidiary - Diamond Flower Information (NL) B.V. | 528,287 | 420,268 |
| Subsidiary - DFI Co., Ltd. | 319,555 | 321,741 |
| Other subsidiaries | 183,067 | 117,451 |
| Associate | 19,478 | - |
| Other related parties | 192,570 | 180,804 |
| $ 1,976,973 | 1,630,698 |
Sales of the Company to related parties involve customary products made to order based on the customer demand, so the price is determined by both parties through negotiation. The credit term for related parties is 60 to 90 days after shipment for receipt of payment, and 30 to 90 days for non-related parties.
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
- Purchases
The purchase amount of the Company from the related parties is as follows:
| 2025 | 2024 | |
|---|---|---|
| Parent company | $ 233,775 | 107,471 |
| Subsidiary | 5,033 | 7,438 |
| Associate | 2,381 | - |
| Other related parties | 31,188 | 16,453 |
| $ 272,377 | 131,362 |
The purchases from related parties by the Company are customized products tailored to the requirements of the order, and, therefore, the selling price is mutually agreed. The credit term for related parties is 60 to 90 days after shipment, and for non-related parties is 30 to 120 days after monthly settlement.
- Leases
The Company has leased plants and offices from the parent company and signed the lease contracts based on the rent prices in the adjacent areas.
The Company has recognized interest expenses of NT$896 thousand and NT$1,052 thousand for the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025 and 2024, the balances of related lease liabilities were NT$72,117 thousand and NT$86,062 thousand, respectively.
- Property transaction
Acquisition of assets:
| Category of related party | Item | 2025 | 2024 |
|---|---|---|---|
| Other related parties | Intangible assets | $ - | 3,024 |
- Operating costs, expenses, and other income
The operating costs and expenses incurred by the Company due to the provision of product processing and management services by related parties, as well as other income generated by other transactions, are detailed below:
| Item | Category of related party | 2025 | 2024 |
|---|---|---|---|
| Operating costs | Parent company | $ 23,278 | 22,194 |
| Subsidiary | 900 | 962 | |
| Other related parties | 679 | 863 | |
| Operating expenses | Parent company | 4,197 | 2,928 |
| Subsidiary | 664 | 2,549 | |
| Associate | 6 | - | |
| Other related parties | 8,524 | 5,003 | |
| Other income | Parent company | 162 | 910 |
| Subsidiary | 8,048 | 6,242 | |
| Other related parties | 457 | 4,789 |
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
- Receivables from related parties
Details of the receivables from related parties of the Company are as follows:
| Item | Category of related party | 2025.12.31 | 2024.12.31 |
|---|---|---|---|
| Accounts receivable - related parties | Parent company | ||
| $ 91,692 | 68,343 | ||
| Subsidiaries: | |||
| DFI AMERICA, LLC. | 35,203 | 83,994 | |
| Yan Ying Hao | 32,380 | 25,616 | |
| AEWIN | 26,321 | 25,700 | |
| Others | 31,567 | 25,226 | |
| Associate | 1,656 | 1,444 | |
| Other related parties | 27,923 | 63,563 | |
| 246,742 | 293,886 | ||
| Item | Category of related party | 2025.12.31 | 2024.12.31 |
| --- | --- | --- | --- |
| Other receivables | Parent company | 398 | 1,128 |
| Subsidiaries: | |||
| DFI AMERICA, LLC | - | 9,249 | |
| Others | 2,459 | 3,508 | |
| Other related parties | 360 | 566 | |
| 3,217 | 14,451 | ||
| $ 249,959 | 308,337 |
The Company provides some of the raw materials to the parent company for manufacturing, while the completed semi-finished products are sold back to the Company for processing and assembly. To prevent repeated calculation of the purchases and sales above, the Company did not recognize the amount of raw materials provided to the parent company as operating income. Furthermore, the accounts receivable and payable arising from the sale of raw materials and the purchase of semi-finished products above were not collected and paid on a net basis; therefore, they were not expressed as mutual offset.
~64~
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
- Payables to related parties
The payables of the Company to related parties are detailed as follows:
| Item | Category of related party | 2025.12.31 | 2024.12.31 |
|---|---|---|---|
| Accounts payables | Parent company | $ 35,136 | 50,864 |
| Subsidiary | 91 | 226 | |
| Associate | 261 | - | |
| Other related parties | 5,246 | 7,041 | |
| 40,734 | 58,131 | ||
| Other payables | Parent company | 5,261 | 5,703 |
| Subsidiary | 27 | 1,917 | |
| Other related parties | 3,200 | 1,989 | |
| 8,488 | 9,609 | ||
| Lease liabilities - current | Parent company | 14,101 | 13,944 |
| Lease liabilities - non-current | Parent company | 58,016 | 72,118 |
| 72,117 | 86,062 | ||
| $ 121,339 | 153,802 |
(IV) Compensation of main managerial officers
Short-term employee benefits
| 2025 | 2024 |
|---|---|
| $ 29,489 | 32,205 |
VIII. Pledged Assets
The details of the book-entry values of the asset pledged as collateral provided by the Company are detailed as follows:
| Asset name | Subject matter of pledge guarantee | 2025.12.31 | 2024.12.31 |
|---|---|---|---|
| Pledged certificate of deposit | Performance bond for release before tax to customs house | $ 1,500 | 1,500 |
The aforesaid bank deposits are presented under the financial assets measured at amortized cost.
IX. Significant Contingent Liabilities and Unrecognized Contract Commitments: None.
X. Significant Disaster Losses: None.
XI. Significant Events after the Balance Sheet Date: None.
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
XII. Others
The employee benefits, depreciation and amortization expenses are summarized by function as follows:
| By function
By nature | 2025 | | | 2024 | | |
| --- | --- | --- | --- | --- | --- | --- |
| | Attributable to operating cost | Attributable to operating expenses | Total | Attributable to operating cost | Attributable to operating expenses | Total |
| Employee benefits expenses | | | | | | |
| Salary expense | 192,160 | 368,558 | 560,718 | 190,340 | 345,215 | 535,555 |
| Labor and health insurance expenses | 18,237 | 30,369 | 48,606 | 18,883 | 27,743 | 46,626 |
| Pension expense | 6,070 | 17,006 | 23,076 | 6,576 | 15,985 | 22,561 |
| Remuneration to directors | - | 19,870 | 19,870 | - | 20,193 | 20,193 |
| Other employee benefit expenses | 9,212 | 8,575 | 17,787 | 8,361 | 7,810 | 16,171 |
| Depreciation expense | 61,687 | 19,414 | 81,101 | 67,473 | 20,081 | 87,554 |
| Amortization expense | 2,517 | 3,212 | 5,729 | 3,382 | 3,136 | 6,518 |
Additional information on the number of employees and employee welfare expenses of the Company is as follows:
| 2025 | 2024 | |
|---|---|---|
| Number of employees | 601 | 618 |
| Number of directors not concurrently employed | 6 | 6 |
| Average employee benefit expense | $ 1,093 | 1,015 |
| Average employee salary expense | $ 942 | 875 |
| Average employee salary expense adjustment | 7.66% | 7.76% |
| Supervisors' compensation | $ - | - |
The Company's salary and award policies (for directors, managerial officers, and employees) are as follows:
The compensation of directors of the Company includes the remuneration and award of directors. According to the Articles of Association, if any profit is made, no more than 1% shall be set aside for directors' remuneration. Award shall be proposed by the Human Resources Department in consideration of the competitive environment and operational risks, and shall be evaluated in accordance with the Company's management rules and bonus plan and submitted to the Board of Directors for approval. The compensation composition of the Company's managerial officers and employees consists of fixed wages and variable bonuses, with fixed wages being the basic remuneration of employees and variable bonuses being linked to the Company's operational performance and achievement of strategic goals. The bonus policy shall be proposed by the Human Resources Department in accordance with the Company's salary and award management rules and bonus plan, and shall be submitted to the Board of Directors for approval.
Notes to Parent Company Only Financial Statements of DFI Inc. (Continued)
XIII. Supplementary Disclosures
(I) Information on Material Transactions:
1. Loan of funds to others: please refer to Table 1.
2. Endorsement and guarantee for others: None.
3. Significant securities held at the end of the period (excluding investments in subsidiaries, related enterprises, and equity joint ventures): None.
4. The amount of purchases or sales with related parties reached NT$100 million or 20% and above of the paid-in capital: please refer to Table 2.
5. Receivables from related parties reached NT$100 million or 20% and above of paid-in capital: please refer to Table 3.
(II) Reinvestment and related information: please refer to Table 4.
(III) Investment information in Mainland China: please refer to Table 5.
XIV. Segment Information
Please refer to the consolidated financial statements for the year ended December 31, 2025.
~67~
Table 1.
DFI Inc.
Loan of funds to others
From January 1 to December 31, 2025
Unit: NTS thousand
| No. | Financing company | Loan recipient | Transaction item | Related party | Maximum amount in current period | Ending balance | Amount actually drawn in current period | Range of interest rate | Nature of financing | Business transaction amounts | Reason for short-term financing | Allowance for bad debts recognized | Collateral | Financing limits for each borrowing company | Total financing limits | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Name | Value | |||||||||||||||
| 1 | AEWIN | Beijing AEWIN | Other receivables-related parties | Yes | 236,211 | 223,658 | 223,658 | - | 1 | 190,722 | Business interaction | - | - | - | 190,722 | 555,652 |
| 1 | AEWIN | Beijing AEWIN | Other receivables-related parties | Yes | 21,251 | 20,115 | - | 3% | 2 | - | Operating capital turnover | - | - | - | 277,826 | 555,652 |
| 2 | Ace Pillar | Tianjin ACE Pillar | Other receivables-related parties | Yes | 179,808 | 179,808 | 17,981 | 2% | 2 | - | Operating capital turnover | - | - | - | 394,626 | 789,253 |
| 3 | Cyber South | Tianjin ACE Pillar | Other receivables-related parties | Yes | 42,826 | 22,001 | 22,001 | - | 2 | - | Operating capital turnover | - | - | - | 334,091 | 334,091 |
| 4 | Proton | Tianjin ACE Pillar | Other receivables-related parties | Yes | 23,896 | 12,572 | 12,572 | - | 2 | - | Operating capital turnover | - | - | - | 199,158 | 199,158 |
| 5 | Sezhou Super Pillar | Tianjin ACE Pillar | Other receivables-related parties | Yes | 74,878 | 44,952 | 44,952 | 3% | 2 | - | Operating capital turnover | - | - | - | 130,104 | 130,104 |
Note 1: The limits of funds lent by AEWIN to all others and to each individual were 40% and 20%, respectively, of the net value of the company's most recent financial statements.
Note 2: The limits of funds lent by Ace Pillar to all others and to each individual were 40% and 20%, respectively, of the net value of the company's most recent financial statements.
Note 3: The limits of funds lent by Cyber South to all others and to each individual were 10% and 5%, respectively, of the net value of the company's most recent financial statements. When lending funds to foreign subsidiaries that the parent company directly or indirectly holds 100% of the voting shares based on need for financing, the limit of all loans and each loan was 100% of the net value.
Note 4: The limits of funds lent by Proton to all others and to each individual were 10% and 5%, respectively, of the net value of the company's most recent financial statements. When lending funds to foreign subsidiaries that the parent company directly or indirectly holds 100% of the voting shares based on need for financing, the limit of all loans and each loan was 100% of the net value.
Note 5: The limits of funds lent by Sezhou Super Pillar to all others and to each individual were 40% and 20%, respectively, of the net value of the subsidiaries' most recent financial statements. When lending funds to foreign subsidiaries that the parent company directly or indirectly holds 100% of the voting shares based on need for financing, the limit of all loans and each loan was 100% of the net value of the subsidiaries.
Note 6: "1" for those with the nature for financing arising from business transaction; "2" for those with short-term financing needs.
Table 2.
DFI Inc.
The amount of purchases or sales with related parties reached NTS100 million or 20% and above of the paid-in capital
For the period from January 1 to December 31, 2025
Unit: NTS thousand
| Companies for Purchases (Sales) | Name of counterparty | Relationship | Transaction status | Situation and reason for difference between the trading terms and those of the general trading | Notes and accounts receivable (payable) | Remarks | |||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Purchases (Sales) | Amount | Proportion to total purchase (sales) | Credit period | Unit price | Credit period | Balance | Proportion to total notes and accounts receivable (payable) | ||||
| Diamond Flower Information (NL) B.V. | The Company | Parent company and subsidiary | Purchases | 528,287 | 100.00% | 60-90 days to collect | (6,485) | 100.00% | Note 1 | ||
| The Company | Diamond Flower Information (NL) B.V. | Parent company and subsidiary | (Sales) | (528,287) | 14.05% | 60-90 days to collect | 6,485 | 1.29% | Note 1 | ||
| DFI AMERICA, LLC. | The Company | Parent company and subsidiary | Purchases | 503,837 | 98.63% | 60-90 days to collect | (35,203) | 99.98% | Note 1 | ||
| The Company | DFI AMERICA, LLC. | Parent company and subsidiary | (Sales) | (503,837) | 13.40% | 60-90 days to collect | 35,203 | 7.02% | Note 1 | ||
| DFI Co., Ltd. | The Company | Parent company and subsidiary | Purchases | 319,555 | 100.00% | 60-90 days to collect | (24,526) | 100.00% | Note 1 | ||
| The Company | DFI Co., Ltd. | Parent company and subsidiary | (Sales) | (319,555) | 8.50% | 60-90 days to collect | 24,526 | 4.89% | Note 1 | ||
| The Company | Qsda Corporation | Parent company and subsidiary | Purchases | 233,775 | 7.76% | 60-90 days to collect | (35,136) | 4.67% | |||
| Qsda Corporation | The Company | Parent company and subsidiary | (Sales) | (233,775) | 0.32% | 60-90 days to collect | 35,136 | 0.13% | Note 1 | ||
| Qsda Corporation | The Company | Parent company and subsidiary | Purchases | 230,179 | 0.82% | 60-90 days to collect | (91,692) | 0.29% | Note 1 | ||
| The Company | Qsda Corporation | Parent company and subsidiary | (Sales) | (230,179) | 6.12% | 60-90 days to collect | 91,692 | 18.28% | |||
| Yan Ying Hao Trading (Shenzhen) Co., Ltd. | The Company | Parent company and subsidiary | Purchases | 117,896 | 99.37% | 60-90 days to collect | (32,380) | 99.83% | Note 1 | ||
| The Company | Yan Ying Hao Trading (Shenzhen) Co., Ltd. | Parent company and subsidiary | (Sales) | (117,896) | 3.14% | 60-90 days to collect | 32,380 | 6.46% | Note 1 | ||
| The Company | Brainstorm Corporation | Related parties | (Sales) | (102,935) | 2.74% | 60-90 days to collect | 19,864 | 3.96% | Note 1 | ||
| AEWIN | Aewin Tech Inc. | Parent company and subsidiary | (Sales) | (388,377) | 21.97% | 120 days after shipment | Comparable to general customers | Shipment is immediately converted to a receivable within 120 days and subject to extension according to market conditions | 135,263 | 28.76% | Note 1 |
| AEWIN | Beijing AEWIN | Parent company and subsidiary | (Sales) | (190,722) | 10.79% | 150 days after shipment | Comparable to general customers | Shipment is immediately converted to a receivable within 120 days and subject to extension according to market conditions | 185,624 | 39.47% | Note 1 |
| Aewin Tech Inc. | AEWIN | Parent company and subsidiary | Purchases | 388,377 | 100.00% | 120 days after shipment | Comparable to general customers | Shipment is immediately converted to a receivable within 120 days and subject to extension according to market conditions | (135,263) | 100.00% | Note 1 |
| Beijing AEWIN | AEWIN | Parent company and subsidiary | Purchases | 190,722 | 24.66% | 150 days after shipment | Comparable to general customers | Shipment is immediately converted to a receivable within 120 days and subject to extension according to market conditions | (185,624) | 36.13% | Note 1 |
Note 1: The above transactions have been offset when preparing the consolidated financial report.
Table 3.
DFI Inc.
Accounts receivable from related parties reached NT$100 million or 20% and above of paid-in capital
December 31, 2025
Unit: NT$ thousand
| Company with receivables | Name of counterparty | Relationship | Balance of receivables from related parties | Turnover rate | Overdue receivables from related parties | Recovery amount of accounts receivable from related parties after the balance sheet date | Allowance for bad debts recognized | |
|---|---|---|---|---|---|---|---|---|
| Amount | Treatment | |||||||
| AEWIN | Beijing AEWIN | Parent company and subsidiary | 185,624 | 0.90 | 107,102 | Strengthen collection | - | - |
| AEWIN | Beijing AEWIN | Parent company and subsidiary | 223,658 | - | - | - | 52,618 | - |
| AEWIN | Aewin Tech Inc. | Parent company and subsidiary | 135,263 | 2.98 | - | - | - | - |
Note: The aforesaid transactions had been offset when the consolidated financial statements were prepared.
Table 4.
DFI Inc.
Reinvestment and related information
From January 1 to December 31, 2025
Unit: NTS thousand/In thousands of shares
| Name of investee | Location | Primary business | Original investment amount | Ending shareholding | Current profit (loss) of the investee in the period | Investment profit (loss) recognized for the period | Remarks (Note 2) | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| End of current period | End of last year | Number of shares | Ratio | Carrying amount | |||||||
| The Company | DFI AMERICA, LLC. | USA | Sales of industrial computer cards | 254,683 | 254,683 | 1,209 | 100% | 478,691 | 29,795 | 29,795 | Subsidiary of the Company |
| The Company | Yan Tong | Mauritius | General investment business | 28,394 | 28,394 | 1,100 | 100% | 33,034 | (536) | (514) | Subsidiary of the Company |
| The Company | DFI Co., Ltd. | Japan | Sales of industrial computer cards | 104,489 | 104,489 | 6 | 100% | 175,935 | 15,600 | 15,600 | Subsidiary of the Company |
| The Company | Diamond Flower Information (NL) B.V. | Netherlands | Sales of industrial computer cards | 35,219 | 35,219 | 12 | 100% | 203,143 | 9,997 | 9,997 | Subsidiary of the Company |
| The Company | AEWIN | Taiwan | Design, manufacturing and sale of industrial computer motherboards and related products | 564,191 | 564,191 | 30,376 | 51.38% | 716,016 | 38,348 | 19,703 | Subsidiary of the Company |
| The Company | Ace Pillar | Taiwan | Automated control and testing, processing, sales, repair, and mechanical and electrical integration of industrial transmission systems | 1,270,850 | 1,270,850 | 52,436 | 46.71% | 1,003,813 | (61,735) | (33,635) | Subsidiary of the Company |
| The Company | TPK | Taiwan | Production, manufacturing, and sales of bundling equipment | 560,000 | 560,000 | 3,165 | 31.65% | 650,881 | 253,578 | 62,305 | Subsidiary of the Company |
| The Company | APLEX | Taiwan | Sales of Displays and Mainframes for Industrial Computers | 234,297 | 234,297 | 4,957 | 13.36% | 265,039 | 47,862 | 174 | Associate of the Company |
| AEWIN | Wise Way | Anguilla | Investment business | 90,940 | 46,129 | 3,000 | 100% | 119,239 | (20,731) | (Note 1) | Subsidiary indirectly controlled by the Company |
| AEWIN | Aewin Tech Inc. | USA | Wholesale of computer and peripheral equipment and software | 77,791 | 77,791 | 2,560 | 100% | 40,434 | 16,439 | (Note 1) | Subsidiary indirectly controlled by the Company |
| Wise Way | Bright Profit | Hong Kong | Investment business | 90,940 | 46,129 | 3,000 | 100% | 139,423 | (20,731) | (Note 1) | Subsidiary indirectly controlled by the Company |
| Ace Pillar | Cyber South | Samoa | Holding Company | 107,041 | 107,041 | 4,669 | 100% | 334,091 | (180,224) | (Note 1) | Subsidiary indirectly controlled by the Company |
| Cyber South | Proton | Samoa | Holding Company | 527,665 | 527,665 | 17,744 | 100% | 199,158 | (183,821) | (Note 1) | Subsidiary indirectly controlled by the Company |
| Cyber South | Ace Tek | Hong Kong | Holding Company | 4,938 | 4,938 | 150 | 100% | 3,100 | (16) | (Note 1) | Subsidiary indirectly controlled by the Company |
| Ace Pillar | Standard Co. | Taiwan | Trading of semiconductor optoelectronic equipment and consumables and equipment maintenance services | 187,000 | 187,000 | 6,084 | 60% | 220,871 | 19,519 | (Note 1) | Subsidiary indirectly controlled by the Company |
| Standard Co. | Standard Technology Corp. | BVI | Holding Company | 21,727 | 21,727 | 600 | 100% | 82,705 | 9,526 | (Note 1) | Subsidiary indirectly controlled by the Company |
| ACE Energy | BlueWalker GmbH | Germany | Trading and services of energy management products | 138,804 | 138,804 | (Note 3) | 100% | 239,834 | 34,813 | (Note 1) | Subsidiary indirectly controlled by the Company |
| Ace Pillar | ACE Energy | Taiwan | Energy technical services | 166,760 | 166,760 | 4,993 | 99.86% | 278,340 | 40,190 | (Note 1) | Subsidiary indirectly controlled by the Company |
| Ace Pillar | TPK | Taiwan | Production, manufacturing, and sales of bundling equipment | 690,000 | 690,000 | 3,900 | 39% | 801,987 | 253,578 | (Note 1) | Subsidiary indirectly controlled by the Company |
Note 1: The profit or loss of the investee company has been included in its investor, so to avoid confusion, it is not be expressed separately here.
Note 2: The subsidiaries directly and indirectly controlled by the Company in the above table have been written off when preparing the consolidated financial report.
Note 3: It is a limited liability company, so there is no number of shares.
Table 5.
DFI Inc.
Investment information in Mainland China
From January 1 to December 31, 2025
1. Information on reinvestment in Mainland China:
Unit: In thousands of New Taiwan Dollar
In thousands of foreign currency
| Investor in mainland China | Primary business | Paid-in capital | Investment method | Accumulated amount of investment remitted out of Taiwan at the beginning of the period | Remitted or repatriated amount of investment for the period | Accumulated investment amount remitted from Taiwan at the end of current period | Current profit (loss) of the investee in the period | Shareholding ratio of direct or indirect investment of the Company | Investment profit (loss) recognized for the period | Ending carrying value of investment | Repatriated investment income as of the end of the period | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Remitted | Repatriated | |||||||||||
| Yan Ying Han Trading (Shenzhen) Co. Ltd. | Wholesale, import and export of computer motherboard, board cards, host computer, electronic parts and components | 15,393 | (Note 1) | - | - | - | - | 67 | 100% | 67 | 29,453 | - |
| (USD 500) | (USD -) | |||||||||||
| Beijing AEWIN | Business of wholesaling computers and their peripheral equipment and software | 90,940 | (Note 1) | 46,129 | 44,811 | - | 90,940 | (20,736) | 100% | (20,736) | 139,412 | - |
| (USD 3,000) | (USD 1,500) | (USD 1,500) | (USD 3,000) | (Note 3) | ||||||||
| Tianjin ACE Pillar | Trade of transmission mechanical components | 1,109,385 | (Note 1) | 61,289 | - | - | 61,289 | (228,053) | 100% | (228,053) | 224,833 | 125,533 |
| (USD 35,297) | (USD 1,950) | (USD 1,950) | (Note 3) | |||||||||
| Quansheng Information | Electronic system integration | 9,429 | (Note 1) | 4,715 | - | - | 4,715 | (16) | 100% | (16) | 3,072 | - |
| (USD 300) | (USD 150) | (USD 150) | (USD 0.5) | (USD 97) | ||||||||
| Suzhou Super Pillar | Processing and technical services of mechanical transmission and control products | 45,574 | (Note 1) | - | - | - | - | 10,799 | 100% | (Note 3) | 10,799 | - |
| (USD 1,450) | (Note 4) | (Note 4) | (10,799) | 130,104 | ||||||||
| Shanghai Standard | Trading of semiconductor optoelectronic equipment and consumables and equipment maintenance services | 15,086 | (Note 1) | 15,086 | - | - | 15,086 | 9,398 | 100% | (Note 3) | 9,398 | 78,953 |
| (USD 480) | (USD 480) | (USD 480) |
Note 1: Reinvest in the companies in Mainland China through companies established in third regions.
Note 2: It is a limited liability company, so there is no number of shares data.
Note 3: It is recognized in line with the financial report prepared by the investee and reviewed by the CPA of the parent company in Taiwan.
Note 4: It was reinvested and established by Cyber South.
- Limit of investment in mainland China:
| Name of investor company | Accumulated remitted from Taiwan at the end of current period Amount of investment in mainland China | Department of Investment Review of the Ministry of Economic Affairs Approved Investment Amount | In accordance with the Department of Investment Review of the Ministry of Economic Affairs Limit of investment in mainland China (Note 2, 3, and 4) |
|---|---|---|---|
| DFI | 0 (Note 1) | 15,393 (USD 500) | 3,421,165 |
| AEWIN | 90,940 (USD 3,000) | 90,940 (USD 3,000) | 833,479 |
| Ace Pillar | 160,890 (USD 5,119) | 160,890 (USD 5,119) | 1,729,946 |
| Standard Co. | 15,086 (USD 480) | 15,086 (USD 480) | 121,739 |
Note 1: It refers to the amount actually remitted by the Company and approved by the Investment Commission, excluding the amount remitted by subsidiaries and approved by the Investment Commission.
Note 2: According to the Review Principles for Investment or Technical Cooperation in Mainland China, the accumulated amount of investment in Mainland China shall not exceed $60\%$ of the net value or consolidated net value, whichever the higher.
Note 3: The Department of Investment Review, Ministry of Economic Affairs approved an investment of US$2,859 thousand in Delta Green Tech; Ace Pillar had sold all of its shares in the Company in 2011 and completed the required filing with the Department of Investment Review on August 5, 2011; however, the approved investment quota has not yet been cancelled.
- Material transactions with investees in Mainland China:
Please refer to the statement under the "Information on Significant Transactions" for the direct or indirect material transactions between the Group and the investees in mainland China from January 1 to December 31, 2025 (these transactions had been written off when the consolidated financial statements were prepared).
DFI Inc.
Statement of cash and cash equivalent
December 31, 2025
Unit: NT$ thousand
| Item | Summary | Amount |
|---|---|---|
| Petty cash and cash on hand | $ 67 | |
| Demand deposits and check deposits | 38,507 | |
| Foreign currency deposits (Note) | USD: 8,336 | 262,000 |
| RMB: 11,000 | 49 | |
| $ 300,623 |
Note: Foreign currency deposits are translated at the spot exchange rate on December 31, 2025
USD: NTD=1: 31.43
RMB: NTD=1: 4.4952
Statement of Accounts Receivable
| Client name | Amount |
|---|---|
| Client A | $ 40,804 |
| Client B | 29,277 |
| Client C | 28,730 |
| Client D | 19,161 |
| Client E | 13,332 |
| Client F | 13,005 |
| Client G | 12,826 |
| Others (Note) | 100,244 |
| 257,379 | |
| Less: Allowance for loss | (2,552) |
| $ 254,827 |
Note: None has reached 5% of the item.
DFI Inc.
Statement of other receivables
December 31, 2025
Unit: NT$ thousand
| Item | Summary | Amount | Remarks |
|---|---|---|---|
| Business tax refund receivable | $ 12,991 | ||
| Others (all less than 5%) | 4,827 | ||
| $ 17,818 |
Note: None has reached 5% of the item.
Statement of inventories
| Item | Amount | Remarks | |
|---|---|---|---|
| Carrying amount | Net realizable value | ||
| Raw materials | $ 532,259 | 601,965 | |
| Work in progress | 121,753 | 149,560 | |
| Finished goods and commodities | 91,524 | 121,146 | |
| Goods in transit | 24,980 | 24,980 | |
| Outsourced processed goods | 16,766 | 16,766 | |
| $ 787,282 | 914,417 |
~74~
DFI Inc.
Statement of changes in financial assets measured at fair value through income - non-current
From January 1 to December 31, 2025
Unit: NT$ thousand/In thousands of shares
| Financial instrument name | Beginning of the period | Increase in the period | Decrease in the period | End of period | Guarantee or pledge provided | Remarks | ||||
|---|---|---|---|---|---|---|---|---|---|---|
| Number of Shares or Number of Lots | Fair value | Number of Shares or Number of Lots | Amount | Number of Shares or Number of Lots | Amount | Number of Shares or Number of Lots | Fair value | |||
| Stocks of domestic unlisted companies - Racing Electric Instrument Co., LTD. | - | $ - | 333 | $ 20,000 | - | $ - | 333 | $ 20,000 |
~75~
DFI Inc.
Statement of changes in investments accounted for using equity method
From January 1 to December 31, 2025
Unit: NT$ thousand
| Investee | Beginning balance | Increase in the period | Decrease in the period (Note 2) | Adjustment using the equity method (Note 1) | Ending balance | Market price or net equity | Guarantee or pledge provided | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Number of shares | Amount | Number of shares | Amount | Number of shares | Amount | Number of shares | Shareholding ratio | Amount | Unit price (NT$) | Total | |||
| Diamond Flower Information (NL) B.V. | 12,001 | $ 188,484 | - | - | - | - | 26,014 | 12,001 | 100% | 214,498 | 17,873.34 | 214,498 | None |
| DFI AMERICA, LLC. | 1,209,000 | 477,589 | - | - | - | - | 18,289 | 1,209,000 | 100% | 495,878 | 263.03 | 318,003 | None |
| DFI Co., Ltd. | 6,200 | 168,518 | - | - | - | - | 8,408 | 6,200 | 100% | 176,926 | 27,005.72 | 167,435 | None |
| Yan Tong Technology Ltd. | 1,100,000 | 37,176 | - | - | - | - | (513) | 1,100,000 | 100% | 36,663 | 33.33 | 36,663 | None |
| AEWIN | 30,376,000 | 722,171 | - | - | - | (27,035) | 20,880 | 30,376,000 | 51.38% | 716,016 | 48.40 | 1,470,198 (Note 3) | None |
| Ace Pillar | 52,436,069 | 1,063,378 | - | - | - | (23,596) | (35,311) | 52,436,069 | 46.71% | 1,004,471 | 78.50 | 4,116,231 (Note 3) | None |
| TPK | 373,333 | 597,914 | 2,791,885 | - | - | (9,333) | 62,300 | 3,165,218 | 31.65% | 650,881 | 205.77 | 651,322 | None |
| APLEX | 4,957,395 | 272,944 | - | - | - | (7,436) | (469) | 4,957,395 | 13.36% | 265,039 | 38.30 | 189,868 (Note 3) | None |
| Less: Deferred inter-affiliate gains | (20,388) | - | (13,432) | - | (33,820) | ||||||||
| $ 3,507,786 | - | (80,832) | 99,598 | 3,526,552 |
Note 1: Adjustment using the equity method is as follows:
Shares of profit (loss) of subsidiaries accounted for using the equity method
$ 103,425
Adjustment to exchange difference in financial statement translation of foreign operations
1,068
Adjustment to unrealized gain (loss) on financial assets measured at fair value through other comprehensive income
(5,193)
Adjustment to re-measurement of defined benefit plan
127
Changes in percentage of ownership interests in subsidiaries
171
$ 99,598
Note 2: The decrease includes the cash dividends received from investees of NT$67,400 thousand.
Note 3: It reveals the market capitalization of the company.
Note 4: The increase in TPK's number of shares was that added through the conversion of TPK's capital reserve into a capital increase.
DFI Inc.
Statement of short-term borrowings
December 31, 2025
Unit: NT$ thousand
| Types of borrowing | Description | Ending balance | Term of contract | Financing facilities | Mortgage or guarantee (with promissory note issued) |
|---|---|---|---|---|---|
| Credit borrowings | Chang Hwa Commercial Bank | $ 150,000 | 2025.06.01~2026.05.31 | 300,000 | None |
| // | Taipei Fubon Bank | 50,000 | 2025.08.24~2026.08.24 | 600,000 | None |
| // | Bank of Taiwan | 300,000 | 2025.10.02~2026.10.02 | 300,000 | None |
| // | Mega International Commercial Bank | 180,000 | 2025.03.04~2026.03.03 | 180,000 | None |
| $ 680,000 |
Note: The annual interest rates of the above short-term borrowings are 1.82%-1.86%.
Statement of accounts payable
| Supplier | Amount |
|---|---|
| Company A | $ 170,779 |
| Company B | 64,101 |
| Company C | 39,293 |
| Others (Note) | 437,834 |
| $ 712,007 |
Note: Accounts payable to individual supplier, less than 5% of the item.
DFI Inc.
Statement of other payables
December 31, 2025
Unit: NT$ thousand
| Item | Amount |
|---|---|
| Salaries and bonuses payable | $ 98,086 |
| Compensation payable to employees and directors | 32,110 |
| Insurance Payable | 10,895 |
| Others (Note) | 69,670 |
| $ 210,761 |
Note: None has reached 5% of the item.
Statement of lease liabilities
| Item | Lease period | Discount rate | Ending balance |
|---|---|---|---|
| Buildings | 2021.1~2031.3 | 1.1%~1.43% | $ 72,117 |
| Current: | |||
| Related party - Qisda | $ 14,101 | ||
| Non-current: | |||
| Related party - Qisda | $ 58,016 |
~78~
DFI Inc.
Statement of long-term borrowings
December 31, 2025
Unit: NT$ thousand
| Creditor | Summary | Amount of borrowing | Term of contract | Mortgage or pledge |
|---|---|---|---|---|
| KGI Bank | $ 520,000 | 2023.08.29-2028.08.18 | None | |
| Yuanta Bank | 400,000 | 2025.02.25-2027.02.25 | None | |
| 920,000 | ||||
| Less: Long-term borrowings due within one year | (320,000) | |||
| $ 600,000 |
Note: The annual interest rate of the above long-term borrowings is 1.88-1.89%.
~79~
DFI Inc.
Statement of operating costs
From January 1 to December 31, 2025
Unit: NT$ thousand
| Item | Amount |
|---|---|
| Raw materials: | |
| Beginning stock | $ 347,469 |
| Plus: Net amount of material purchase in the period | 2,775,934 |
| Less: Ending raw materials | 601,929 |
| Scrapping of raw materials | 25,353 |
| Loss on physical raw materials | 8 |
| Sale of raw materials | 202,232 |
| Raw material requisition and others | 7,410 |
| Consumption of raw materials in the period | 2,286,471 |
| Direct labor | 106,123 |
| Manufacturing expense | 252,953 |
| Manufacturing cost | 2,645,547 |
| Beginning work in process | 105,739 |
| Beginning outsourced products | 1,086 |
| Plus: Outsourcing processing fee | 40,827 |
| Less: Ending work in process | 121,753 |
| Ending outsourced products | 16,765 |
| Scrapping of work in process | 129 |
| Work in process costs | 2,654,552 |
| Beginning finished goods | 141,297 |
| Plus: Net purchase amount for the period | 59,673 |
| Less: Ending finished goods | 124,540 |
| Scrapping of finished goods | 9,297 |
| Sale of semi-finished goods | 63,164 |
| Department requisition and others | 26,717 |
| Finished goods cost | 2,631,804 |
| Inventory scrap loss | 34,779 |
| Loss on physical inventory | 8 |
| Cost of selling raw materials and semi-finished goods | 265,396 |
| Gain from price recovery of inventory | (40,835) |
| Warranty cost | (7,245) |
| Income from scraps | (4,010) |
| Operating costs | $ 2,879,897 |
~80~
DFI Inc.
Statement of selling and marketing expenses
From January 1 to December 31, 2025
Unit: NT$ thousand
| Item | Amount |
|---|---|
| Salary expense | $ 120,390 |
| Insurance expenses | 14,670 |
| Other expenses (Note) | 72,087 |
| $ 207,147 |
Note: None has reached 5% of the item.
Statement of general and administrative expenses
| Item | Amount |
|---|---|
| Salary expense | $ 47,712 |
| Depreciation | 9,218 |
| Software program fee | 7,705 |
| Labor cost | 6,638 |
| Other expenses (Note) | 45,334 |
| $ 116,607 |
Note: None has reached 5% of the item.
DFI Inc.
Statement of research and development expenses
From January 1 to December 31, 2025
Unit: NT$ thousand
| Item | Amount |
|---|---|
| Salary expense | $ 200,456 |
| Research and development testing | 19,960 |
| Insurance expenses | 18,051 |
| Other expenses (Note) | 54,033 |
| $ 292,500 |
Note: None has reached 5% of the item.
Please refer to Note VI (II) of the parent company only financial statements for the Statement of Financial Instruments Measured at Fair Value Through Profit or Loss - Current
Please refer to Note VI (IV) of the parent company only financial statements for the Statement of Financial Assets Measured at Amortized Cost - Current
Please refer to Note VII of the parent company only financial statements for the Statement of Accounts Receivable - Related Parties
Please refer to Note VI (VIII) of the parent company only financial statements for the Statement of Changes in Property, Plant and Equipment
Please refer to Note VI (IX) of the parent company only financial statements for the Statement of Changes in Right-of-Use Assets
Please refer to Note VI (X) of the parent company only financial statements for the Statement of Changes in Investment Property
Please refer to Note VI (XI) of the parent company only financial statements for the Statement of Changes in Intangible Assets
Please refer to Note VI (XVII) of the parent company only financial statements for the Statement of Deferred Income Tax Assets
Please refer to Note VII of the parent company only financial statements for the Statement of Accounts Payable - Related Parties
Please refer to Note VII of the parent company only financial statements for the Statement of Other Accounts Payables - Related Parties
Please refer to Note VI (XV) of the parent company only financial statements for the Statement of Provisions
Please refer to Note VI (XVII) of the parent company only financial statements for the Statement of Deferred Income Tax Liabilities
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Please refer to Note VI (XVI) of the parent company only financial statements for the Statement of Net Defined Benefit Liabilities
Please refer to Note VI (XX) of the parent company only financial statements for the Statement of Operating Revenue
Please refer to Note VI (XXII) of the parent company only financial statements for the Statement of Interest Income, Other Income, Other Gain and Loss and Financial Costs of Non-Operating Income and Expenses
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