EDISON OPTO - Interim / Quarterly Report 2021

Stock Code:3591

EDISON OPTO CORPORATION AND SUBSIDIARIES

Consolidated Financial Statements

With Independent Auditors’ Review Report For the Nine Months Ended September 30, 2021 and 2020

Address: 5F., No. 800, Chung-Cheng Rd., Chung-Ho Dist., New Taipei City Telephone: (02)8227-6996

The independent auditors’ review report and the accompanying consolidated 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’ review report and consolidated financial statements, the Chinese version shall prevail.

Contents 1. Cover Page 2. Table of Contents 3. Independent Auditors’ Review Report 4. Consolidated Balance Sheets 5. Consolidated Statements of Comprehensive Income 6. Consolidated Statements of Changes in Equity 7. Consolidated Statements of Cash Flows 8. Notes to the Consolidated Financial Statements (1) Company history (2) Approval date and procedures of the consolidated financial statements (3) New standards, amendments and interpretations adopted (4) Summary of significant accounting policies (5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty (6) Explanation of significant accounts (7) Related-party transactions (8) Pledged assets (9) Commitments and contingencies (10) Losses Due to Major Disasters (11) Subsequent Events (12) Other (13) Other disclosures (a) Information on significant transactions (b) Information on investees (c) Information on investment in mainland China (d) Major shareholders (14) Segment information	Page
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Contents
1. Cover Page
2. Table of Contents
3. Independent Auditors’ Review Report
4. Consolidated Balance Sheets
5. Consolidated Statements of Comprehensive Income
6. Consolidated Statements of Changes in Equity
7. Consolidated Statements of Cash Flows
8. Notes to the Consolidated Financial Statements
(1)
Company history
(2)
Approval date and procedures of the consolidated financial statements
(3)
New standards, amendments and interpretations adopted
(4)
Summary of significant accounting policies
(5)
Significant accounting assumptions and judgments, and major sources
of estimation uncertainty
(6)
Explanation of significant accounts
(7)
Related-party transactions
(8)
Pledged assets
(9)
Commitments and contingencies
(10) Losses Due to Major Disasters
(11) Subsequent Events
(12) Other
(13) Other disclosures
(a) Information on significant transactions
(b) Information on investees
(c) Information on investment in mainland China
(d) Major shareholders
(14) Segment information

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KPMG

台北市110615信義路5段7號68樓(台北101大樓) Telephone 電話 + 886 2 8101 6666 68F., TAIPEI 101 TOWER, No. 7, Sec. 5, Fax 傳真 + 886 2 8101 6667 Xinyi Road, Taipei City 110615, Taiwan (R.O.C.) Internet 網址 home.kpmg/tw

Independent Auditors’ Review Report

To the Board of Directors of Edison Opto Corporation:

Introduction

We have reviewed the accompanying consolidated balance sheets of EDISON OPTO CORPORATION and its subsidiaries as of September 30, 2021 and 2020, and the related consolidated statements of comprehensive income for the three months and nine months ended September 30, 2021 and 2020, as well as the changes in equity and cash flows for the nine months ended September 30, 2021 and 2020, and notes to the consolidated financial statements, including a summary of significant accounting policies. Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “Interim Financial Reporting” endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China. Our responsibility is to express a conclusion on the consolidated financial statements based on our reviews.

Scope of Review

Except as explained in the Basis for Qualified Conclusion paragraph, we conducted our reviews in accordance with Statement of Auditing Standard 65, “ Review of Financial Information Performed by the Independent Auditor of the Entity”. A review of the consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with the generally accepted auditing standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Basis for Qualified Conclusion

As stated in Note 4(b), the consolidated financial statements included the financial statements of certain nonsignificant subsidiaries, which were not reviewed by independent auditors. These financial statements reflect total assets amounting to $386,745 thousand and $482,861 thousand, constituting 10.04% and 13.63% of consolidated total assets at September 30, 2021 and 2020, respectively, total liabilities amounting to $26,855 thousand and $183,463 thousand, constituting 2.31% and 18.96% of consolidated total liabilities at September 30, 2021 and 2020, respectively, and total comprehensive income (loss) amounting to $8,017 thousand, $(7,602) thousand, $23,894 thousand and $(10,204) thousand, constituting 45.64%, (22.72)%, (43.09)% and (120.93)% of consolidated total comprehensive income (loss) for the three months and nine months ended September 30, 2021 and 2020, respectively.

KPMG, a Taiwan partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee.

3-1

Qualified Conclusion

Except for the adjustments, if any, as might have been determined to be necessary had the financial statements of certain consolidated subsidiaries described in the Basis for Qualified Conclusion paragraph above been reviewed by independent auditors, based on our reviews, nothing has come to our attention that causes us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of EDISON OPTO CORPORATION and its subsidiaries as of September 30, 2021 and 2020, and of its consolidated financial performance for the three months and nine months ended September 30, 2021 and 2020, as well as its consolidated cash flows for the nine months ended September 30, 2021 and 2020 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “ Interim Financial Reporting” endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

The engagement partners on the audit resulting in this independent auditors’ report are HENG-SHEN LIN and PEI-CHI CHEN.

KPMG

Taipei, Taiwan (Republic of China) November 12, 2021

Notes to Readers

The accompanying consolidated financial statements are intended only to present the consolidated 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 review such consolidated financial statements are those generally accepted and applied in the Republic of China.

						September 30, 2020	Amount %		423,675 12	291,914 8	94,377 3	19,861 1	12,313 -	- -		35,495 1	877,635 25		- -	- -	2,035 -	40,669 1 47,132 1	89,836 2	967,471 27		1,225,564 35 1,553,526 44 - -	30,551 1		(209,363) (6)	(46,287) (1)		(8,150) -	(58,877) (2)	2,486,964 71	87,264 2	2,574,228 73	3,541,699 100
						December 31, 2020	Amount %		482,352 13	369,907 10	110,128 3	18,361 -	11,916 -	- -		35,523 1	1,028,187 27		- -	- -	2,035 -	39,229 1 41,140 1	82,404 2	1,110,591 29		1,225,564 33 1,553,577 41 - -	48,411 1		(177,025) (4)	(17,426) -		(6,378) -	(61,902) (2)	2,564,821 69	88,841 2	2,653,662 71	3,764,253 100
(English Translation of Consolidated Financial Statements Originally Issued in Chinese)	Reviewed only, not audited in accordance with the generally accepted auditing standards as of September 30, 2021 and 2020	EDISON OPTO CORPORATION AND SUBSIDIARIES	Consolidated Balance Sheets	September 30, 2021, December 31, 2020, and September 30, 2020	(Expressed in Thousands of New Taiwan Dollars)	September 30, 2021 December 31, 2020 September 30, 2020 September 30, 2021	Assets Amount % Amount % Amount % Liabilities and Equity Amount %	Current assets: 21xx Current liabilities:	Cash and cash equivalents (note 6(a)) $ 1,079,457 28 1,249,755 33 1,216,943 34 2100 Short-term borrowings (note 6(i) and 8) $ 102,674 3	Current financial assets at fair value through profit or 9,126 - - - - - 2170 Accounts and notes payable 317,801 8	loss (note 6(b)) 2200 Other payables (note 6(t)) 110,994 3	Accounts and notes receivable, net (note 6(e)(s)) 425,577 11 424,578 11 416,467 12 2230 Current tax liabilities 12,826 -	Other receivables 6,697 - 2,028 - 3,908 - 2280 Current lease liabilities (note 6(l)) 15,140 -	Inventories (note 6(f)) 301,033 8 265,522 7 216,809 6 2322 Long-term borrowings, current portion (note 6(j) and 16,080 1	Prepayments 85,331 2 64,526 2 57,785 2 8)	Other current assets (note 8) 44,163 1 131,671 3 128,405 4 2399 Other current liabilities, others 45,291 1	Total current assets 1,951,384 50 2,138,080 56 2,040,317 58 Total current liabilities 620,806 16	Non-current assets: 25xx Non-Current liabilities:	Non-current financial assets at fair value through 2530 Bonds payable (note 6(k) and 8) 173,347 4	profit or loss (note 6(b) and (k)) 574 - - - - - 2540 Long-term borrowings (note 6(j) and 8) 294,800 8	Non-current financial assets at fair value through other comprehensive income (note 6(c)) - - 131,960 4 106,124 3 Non-current financial assets at amortized cost, net (note 6(d)) 8,722 - - - - - 2570 Deferred tax liabilities 2,035 - 2580 Non-current lease liabilities (notes 6(l)) 28,954 1 2600 Other non-current liabilities (notes 6(m)) 40,460 1		Property, plant and equipment (notes 6(g), 8 and 9) 1,672,889 43 1,206,246 32 1,206,256 34 Total non-current liabilities 539,596 14	Right-of-use assets (note 6(h)) 70,090 2 79,502 2 81,536 2 Total liabilities 1,160,402 30	Intangible assets 3,017 - 3,757 - 4,277 - Deferred tax assets 61,753 2 61,753 2 65,613 2 Prepayments for business facilities (note 9) 25,718 1 5,318 - 7,938 - Other non-current assets, others (note 6(g) and 8) 59,456 2 137,637 4 29,638 1 Total non-current assets 1,902,219 50 1,626,173 44 1,501,382 42 31xx Equity attributable to owners of parent (notes 6(p)(q)): 3100 Capital stock 1,282,073 33 3200 Capital surplus 1,628,214 42 3310 Legal reserve 4,841 - 3350 Total unappropriated retained earnings (accumulated		deficit) 98,473 3	3410 Exchange differences on translation of foreign	financial statements (199,772) (5)	3420 Unrealized gains (loss) on financial assets at fair (148,761) (4)	value through other comprehensive income	3491 Other equity, unearned compensation (2,066) -	3500 Treasury shares (62,527) (1)	Total equity attributable to owners of parent: 2,600,475 68	36xx Non-controlling interests 92,726 2	Total equity 2,693,201 70	Total assets $ 3,853,603 100 3,764,253 100 3,541,699 100 Total liabilities and equity $ 3,853,603 100
								11xx	1100	1110		1170	1200	1310	1410	1470		15xx	1510		1517	1535	1600	1755	1780	1840 1915 1990

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with generally accepted auditing standards

EDISON OPTO CORPORATION AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the nine months ended September 30, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars Except Earnings Per Share)

4000 Operating revenue (note 6(s)) 5000 Operating costs (notes 6(f)(g)(h)(n)) Gross profit from operations Operating expenses (note 6(e)(g)(h)(l)(n)(q)(t)): 6100 Selling expenses 6200 Administrative expenses 6300 Research and development expenses 6450 Impairment loss (reversal of impairment losses) Total operating expenses 6900 Net operating income Non-operating income and expenses (note 6(g)(i)(j)(k)(l)(m)(u)): 7100 Interest income 7010 Other income 7020 Other gains and losses 7050 Finance costs Total non-operating income and expenses 7900 Profit from continuing operations before tax 7950 Less: Income tax expenses (note 6(o)) Profit 8300 Other comprehensive income: 8310 Components of other comprehensive income that will not be reclassified to profit or loss 8316 Unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income (note 6(c)) 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8360 Components of other comprehensive income (loss) that will be reclassified to profit or loss 8361 Exchange differences on translation of foreign financial statements 8399 Income tax related to components of other comprehensive income that will be reclassified to profit or loss Components of other comprehensive income that will be reclassified to profit or loss 8300 Other comprehensive income 8500 Total comprehensive income Profit (loss), attributable to: 8610 Attributable to owners of parent 8620 Attributable to non-controlling interests Comprehensive income attributable to: 8710 Attributable to owners of parent 8720 Attributable to non-controlling interests Basic earnings per share (note 6(r)) 9750 Basic earnings per share Diluted earnings per share 9850 Diluted earnings per share	For the three months ended September 30 2021 2020 Amount % Amount % $ 485,432 100 478,432 100 376,226 78 382,779 80 109,206 22 95,653 20 22,627 5 19,299 4 37,086 7 28,663 6 25,094 5 30,957 6 (492) - 9,359 2 84,315 17 88,278 18 24,891 5 7,375 2 4,033 1 3,920 1 1,301 - 10,496 2 1,648 1 5,806 1 (4,797) (1) (1,895) - 2,185 1 18,327 4 27,076 6 25,702 6 2,627 1 3,315 1 24,449 5 22,387 5 (75) - - - - - - - (75) - - - (6,809) (1) 37,974 8 - - - - (6,809) (1) 37,974 8 (6,884) (1) 37,974 8 $ 17,565 4 60,361 13 $ 24,486 5 25,781 6 (37) - (3,394) (1) $ 24,449 5 22,387 5 $ 17,852 4 62,347 13 (287) - (1,986) - $ 17,565 4 60,361 13 $ 0.20 0.22 $ 0.19 0.22	For the nine months ended September 30 2021 2020 Amount % Amount % 1,606,162 100 1,459,218 100 1,211,615 75 1,190,489 82 394,547 25 268,729 18 76,452 5 62,220 4 128,793 8 106,797 7 77,889 5 78,687 5 (6,167) - 18,739 1 276,967 18 266,443 17 117,580 7 2,286 1 10,960 1 14,799 1 3,917 - 16,530 1 (6,751) - 2,885 - (15,483) (1) (6,414) - (7,357) - 27,800 2 110,223 7 30,086 3 9,969 1 9,691 1 100,254 6 20,395 2 (131,335) (8) (507) - - - - - (131,335) (8) (507) - (24,364) (2) (11,450) (1) - - - - (24,364) (2) (11,450) (1) (155,699) (10) (11,957) (1) (55,445) (4) 8,438 1 94,903 6 30,551 3 5,351 - (10,156) (1) 100,254 6 20,395 2 (59,179) (4) 19,599 2 3,734 - (11,161) (1) (55,445) (4) 8,438 1 0.80 0.26 0.75 0.25	For the nine months ended September 30 2021 2020 Amount % Amount % 1,606,162 100 1,459,218 100 1,211,615 75 1,190,489 82 394,547 25 268,729 18 76,452 5 62,220 4 128,793 8 106,797 7 77,889 5 78,687 5 (6,167) - 18,739 1 276,967 18 266,443 17 117,580 7 2,286 1 10,960 1 14,799 1 3,917 - 16,530 1 (6,751) - 2,885 - (15,483) (1) (6,414) - (7,357) - 27,800 2 110,223 7 30,086 3 9,969 1 9,691 1 100,254 6 20,395 2 (131,335) (8) (507) - - - - - (131,335) (8) (507) - (24,364) (2) (11,450) (1) - - - - (24,364) (2) (11,450) (1) (155,699) (10) (11,957) (1) (55,445) (4) 8,438 1 94,903 6 30,551 3 5,351 - (10,156) (1) 100,254 6 20,395 2 (59,179) (4) 19,599 2 3,734 - (11,161) (1) (55,445) (4) 8,438 1 0.80 0.26 0.75 0.25
	2021 Amount % $ 485,432 100 376,226 78 109,206 22 22,627 5 37,086 7 25,094 5 (492) - 84,315 17 24,891 5 4,033 1 1,301 - 1,648 1 (4,797) (1) 2,185 1 27,076 6 2,627 1 24,449 5 (75) - - - (75) - (6,809) (1) - - (6,809) (1) (6,884) (1) $ 17,565 4 $ 24,486 5 (37) - $ 24,449 5 $ 17,852 4 (287) - $ 17,565 4 $ 0.20 $ 0.19	2021 Amount % 1,606,162 100 1,211,615 75 394,547 25 76,452 5 128,793 8 77,889 5 (6,167) - 276,967 18 117,580 7 10,960 1 3,917 - (6,751) - (15,483) (1) (7,357) - 110,223 7 9,969 1 100,254 6 (131,335) (8) - - (131,335) (8) (24,364) (2) - - (24,364) (2) (155,699) (10) (55,445) (4) 94,903 6 5,351 - 100,254 6 (59,179) (4) 3,734 - (55,445) (4) 0.80 0.75
			0.25

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with generally accepted auditing standards EDISON OPTO CORPORATION AND SUBSIDIARIES Consolidated Statements of Changes in Equity For the nine months ended September 30, 2021 and 2020 (Expressed in Thousands of New Taiwan Dollars) Equity attributable to owners of parent Retained earnings Other equity Ordinary shares Capital surplus Legal reserve Special reserve Unappropriated retained earnings (accumulated deficit)) Exchange differences on translation of foreign financial statements Unrealized gains (losses) on financial assets measured at fair value through other comprehensive income Employees unrealized reward Treasury shares Total equity attributable to owners of parent Non-controlling interests Total equity Balance at January 1, 2020 $ 1,250,014 1,841,558 701 6,313 (289,754) (198,918) (45,780) (19,575) (58,877) 2,485,682 112,806 2,598,488 Appropriation and distribution of retained earnings: Legal reserve used to offset accumulated deficits - - (701) - 701 - - - - - - - Special reserve used to offset accumulated deficits - - - (6,313) 6,313 - - - - - - - - - (701) (6,313) 7,014 - - - - - - - Net income - - - - 30,551 - - - - 30,551 (10,156) 20,395 Other comprehensive income - - - - - (10,445) (507) - - (10,952) (1,005) (11,957) Total comprehensive income - - - - 30,551 (10,445) (507) - - 19,599 (11,161) 8,438 Capital surplus used to offset accumulated deficits - (282,740) - - 282,740 - - - - - - - Cash dividends from capital surplus - (12,300) - - - - - - - (12,300) - (12,300) Purchase of treasury share - - - - - - - - (19,832) (19,832) - (19,832) Retirement of treasury share (16,180) (3,652) - - - - - - 19,832 - - - Changes in ownership interests in subsidiaries - 14,381 - - - - - - - 14,381 (14,381) - Share-based payments - - - - - - - (566) - (566) - (566) Forfeit of restricted employee stocks (8,270) (3,721) - - - - - 11,991 - - - - Balance at September 30, 2020 $ 1,225,564 1,553,526 - - 30,551 (209,363) (46,287) (8,150) (58,877) 2,486,964 87,264 2,574,228 Balance at January 1,2021 $ 1,225,564 1,553,577 - - 48,411 (177,025) (17,426) (6,378) (61,902) 2,564,821 88,841 2,653,662 Appropriation and distribution of retained earnings: Legal reserve appropriated - - 4,841 - (4,841) - - - - - - - Cash dividends of ordinary share - - - - (40,000) - - - - (40,000) - (40,000) - - 4,841 - (44,841) - - - - (40,000) - (40,000) Net income - - - - 94,903 - - - - 94,903 5,351 100,254 Other comprehensive income - - - - - (22,747) (131,335) - - (154,082) (1,617) (155,699) Total comprehensive income - - - - 94,903 (22,747) (131,335) - - (59,179) 3,734 (55,445) Other changes in capital surplus: Due to recognition of equity component of convertible bonds issued - 31,990 - - - - - - - 31,990 - 31,990 Conversion of convertible bonds 56,839 42,424 - - - - - - - 99,263 - 99,263 Acquisition of company's share by subsidiaries recognized as treasury share - - - - - - - - (625) (625) - (625) Difference between consideration and carrying amount of subsidiaries acquired or disposed - 78 - - - - - - - 78 (2,548) (2,470) Changes in ownership interests in subsidiaries - 294 - - - - - - - 294 2,699 2,993 Share-based payments - - - - - - - 3,833 - 3,833 - 3,833 Forfeit of restricted employee stocks (330) (149) - - - - - 479 - - - - Balance at September 30, 2021 $ 1,282,073 1,628,214 4,841 - 98,473 (199,772) (148,761) (2,066) (62,527) 2,600,475 92,726 2,693,201	2,598,488	- -	-	20,395 (11,957)	8,438	- (12,300) (19,832) - - (566) -	2,574,228	2,653,662	- (40,000)	(40,000)	100,254 (155,699)	(55,445)	31,990 99,263 (625) (2,470) 2,993 3,833 -	2,693,201

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

Reviewed only, not audited in accordance with generally accepted auditing standards

EDISON OPTO CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the nine months ended September 30, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from (used in) operating activities:
Profit before tax
Adjustments:
Adjustments to reconcile profit (loss):
Depreciation expense
Amortization expense
Impairment loss (reversal of impairment loss)
Net loss on financial assets or liabilities at fair value through profit or loss
Interest expense
Interest income
Share-based payments
Gain on disposal of property, plant and equipment
Gain on disposal of other assets
Gain on disposal of investments
Total adjustments to reconcile profit
Changes in operating assets and liabilities:
Accounts and notes receivable
Other receivables
Inventories
Prepayments
Other current assets
Other operating assets
Accounts and notes payable
Other payable
Other current liabilities
Net defined benefit liability
Total changes in operating assets and liabilities
Cash inflow generated from operations
Interest received
Interest paid
Income taxes
Net cash flows from operating activities
Cash flows from (used in) investing activities:
Acquisition of financial assets at amortised cost
Acquisition of financial assets at fair value through profit or loss
Proceeds from disposal of financial assets at fair value through profit or loss
Acquisition of property, plant and equipment
Proceeds from disposal of property, plant and equipment
Decrease in refundable deposits
Acquisition of intangible assets
Decrease in other financial assets
Increase in restricted deposits
Decrease in restricted deposits
Increase in other non-current assets
Increase in prepayments for business facilities
Net cash flows from (used in) investing activities
Cash flows from (used in) financing activities:
Increase in short-term loans
Decrease in short-term loans
Proceeds from issuing bonds
Proceeds from long-term debt
Repayments of long-term debt
Increase in guarantee deposits received
Payment of lease liabilities
Cash dividends paid
Payments to acquire treasury shares
Acquisition of ownership interests in subsidiaries
Net cash flows from financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

See accompanying notes to consolidated financial statements

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with generally accepted auditing standards EDISON OPTO CORPORATION AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

September 30, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(1) Company history

Edison Opto Corporation (the “Company”) was approved by the Ministry of Economic Affairs on October 4, 2001 and incorporated in 5F, No.800, Chung-Cheng Rd., Chung-Ho Dist., New Taipei City, Taiwan. The Company’s shares were listed on the Taiwan Stock Exchange in November 2000. The Company and its subsidiaries (hereinafter referred as Group) are mainly engaged in manufacturing, selling, research and development of LED components and modules in general lighting and automotive lighting area.

(2) Approval date and procedures of the consolidated financial statements:

These consolidated financial statements were authorized for issuance by the Board of Directors on November 12, 2021.

(3) New standards, amendments and interpretations adopted:

(a) The impact of the International Financial Reporting Standards (“IFRSs”) endorsed by the Financial Supervisory Commission, R.O.C. (“FSC”) which have already been adopted.

The Group has initially adopted the following new amendments, which do not have a significant impact on its consolidated financial statements, from January 1, 2021:

●Amendments to IFRS 4 “Extension of the Temporary Exemption from Applying IFRS 9”
－
●Amendments to IFRS 9, IAS39, IFRS7, IFRS 4 and IFRS 16 “Interest Rate Benchmark Reform Phase 2”

The Group has initially adopted the (following) new amendments, which do not have a significant impact on its consolidated financial statements, from April 1, 2021：

●Amendments to IFRS 16 “Covid-19-Related Rent Concessions beyond June 30, 2021”
(b) The impact of IFRS issued by the FSC but not yet effective

The Group assesses that the adoption of the following new amendments, effective for annual period beginning on January 1, 2022, would not have a significant impact on its consolidated financial statements:

－
●Amendments to IAS 16 “Property, Plant and Equipment Proceeds before Intended Use”
－
●Amendments to IAS 37 “Onerous Contracts Cost of Fulfilling a Contract”
●Annual Improvements to IFRS Standards 2018–2020
●Amendments to IFRS 3 “Reference to the Conceptual Framework”

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

The Group does not expect the following new and amended standards, which have yet to be endorsed by the FSC, to have a significant impact on its consolidated financial statements:

●Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets Between an Investor and Its Associate or Joint Venture”
●IFRS 17 “ Insurance Contracts” and amendments to IFRS 17 “ Insurance Contracts”
●Amendments to IAS 1 “Classification of Liabilities as Current or Non-current”
●Amendments to IAS 1 “Disclosure of Accounting Policies”
●Amendments to IAS 8 “Definition of Accounting Estimates”
●Amendments to IAS 12 “Deferred Tax related to Assets and Liabilities arising from a Single Transaction”

(4) Summary of significant accounting policies:

The significant accounting policies presented in the consolidated financial statements are summarized below. Except for those specifically indicated, the following accounting policies were applied consistently throughout the periods presented in the consolidated financial statements.

(a) Statement of compliance

These consolidated financial statements have been prepared in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” (hereinafter referred to as the Regulations) and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations endorsed by the FSC (hereinafter referred to as the IFRSs endorsed by the FSC).

Except the following accounting policies mentioned below, the significant accounting policies adopted in the consolidated financial statements are the same as those in the consolidated financial statement for the year ended December 31, 2020. For the related information, please refer to note 4 of the consolidated financial statements for the year ended December 31, 2020.

(b) Basis of consolidation
(i) List of subsidiaries in the consolidated financial statements

Name of investor The Company The Company The Company The Company	Name of subsidiary Principal activity Edison Opto Corporation Business of opto- electronics Ledison Opto Corporation Business of opto- electronics Best Opto Corporation Business of opto- electronics Edison Fund Investment Corporation Investment		Shareholding	September 30, 2020 Note % 100.00 5 % 100.00 5 % 100.00 % 100.00
		September 30, 2021	December 31, 2020 % 100.00 % 100.00 % 100.00 % 100.00
		% 100.00 % 100.00 % 100.00 % 100.00

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Name of investor The Company The Company The Company Ledison Opto Corporation Best Opto Corporation Best Led Corporation Yangzhou Edison Opto Corporation Edison Fund Investment Corporation Edison Fund Investment Corporation Edison Fund Investment Corporation Edison Fund Investment Corporation Ledionopto Lighting Inc. Edison-Litek Opto Corporation Limited Edison-Litek Opto Corporation	Name of subsidiary Principal activity Edison-Litek Opto Corporation Limited (note 1) Investment Edison-Litek Opto Corporation (note 4) Business of opto- electronics Edison-Egypt Opto Corporation Business of opto- electronics Edison Opto (Dong Guan) Co., Ltd. Business of opto- electronics Best Led Corporation Investment Yangzhou Edison Opto Corporation Business of opto- electronics Yangzhou Aichuang Electronic Trade Corporation Business of opto- electronics Edison Opto USA Corporation Business of opto- electronics Edison Auto Lighting Corporation Business of opto- electronics Davinci Opto Corporation (note 2) Business of opto- electronics Ledionopto Lighting Inc. Business of opto- electronics Led Plus Co., Ltd. (note 3) Investment Yangzhou Edison- Litek Opto Corporation Business of opto- electronics Edison-Litek Opto Corporation Limited (note 1) Investment		Shareholding	September 30, 2020 Note % 44.58 % 100.00 % 100.00 5 % 100.00 6 % 100.00 % 100.00 % 100.00 5 % 55.00 5 % 51.00 5 % 100.00 5 % 100.00 5 % 100.00 5 % 100.00 % 28.06
		September 30, 2021	December 31, 2020 % 44.58 % 100.00 % 100.00 % 100.00 % 100.00 % 100.00 % 100.00 % 55.00 % 51.00 % 100.00 % 100.00 % - % 100.00 % 28.06
		% 44.58 % 98.43 % 100.00 % 100.00 % 100.00 % 100.00 % 100.00 % 55.00 % 100.00 % - % 100.00 % - % 100.00 % 28.06

Note 1: The Company and Edison-Litek Opto Corporation Limited held 72.64% of EdisonLitek Opto Corporation Limited in Total.
Note 2: The dissolution of the Company has been registered in 2021.

Note 3: The dissolution of the Company has been registered in 2020.

Note 4: Edison-Litek Opto Corporation issued shares as employee compensation in 2021 which makes the shareholding ratio of the Company's decreased from 100% to 98.43%.
Note 5: The Company is a non-significant subsidiary, its financial statements have not been reviewed.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Note 6: The Company is a non-significant subsidiary on September 30, 2020, its financial statements have not been reviewed.

(ii) Subsidiaries excluded from the consolidated financial statements: None.

(c) Financial instruments

Trade receivables and debt securities issued are initially recognized when they are originated. All other financial assets and financial liabilities are initially recognized when the Group becomes a party to the contractual provisions of the instrument. A financial asset (unless it is a trade receivable without a significant financing component) or financial liability is initially measured at fair value plus, for an item not at fair value through profit or loss (FVTPL), transaction costs that are directly attributable to its acquisition or issue. A trade receivable without a significant financing component is initially measured at the transaction price.

(i) Financial assets

All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis.

On initial recognition, a financial asset is classified as measured at: amortized cost; Fair value through other comprehensive income (FVOCI) – debt investment; FVOCI – equity investment; or FVTPL. Financial assets are not reclassified subsequent to their initial recognition unless the Group changes its business model for managing financial assets, in which case all affected financial assets are reclassified on the first day of the first reporting period following the change in the business model.

1) Fair value through profit or loss (FVTPL)

All financial assets not classified as amortized cost or FVOCI described as above are measured at FVTPL, including derivative financial assets. Trade receivables that the Group intends to sell immediately or in the near term are measured at FVTPL; however, they are included in the ‘trade receivables’ line item. On initial recognition, the Group may irrevocably designate a financial asset, which meets the requirements to be measured at amortized cost or at FVOCI, as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.

These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognized in profit or loss.

(ii) Financial liabilities and equity instruments

1) Compound financial instruments

Compound financial instruments issued by the Group comprise convertible bonds denominated in NTD that can be converted to ordinary shares at the option of the holder, when the number of shares to be issued is fixed and does not vary with changes in fair value.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

The liability component of compound financial instruments is initially recognized at the fair value of a similar liability that does not have an equity conversion option. The equity component is initially recognized at the difference between the fair value of the compound financial instrument as a whole and the fair value of the liability component. Any directly attributable transaction costs are allocated to the liability and equity components in proportion to their initial carrying amounts.

Subsequent to initial recognition, the liability component of a compound financial instrument is measured at amortized cost using the effective interest method. The equity component of a compound financial instrument is not remeasured.

Interest related to the financial liability is recognized in profit or loss. On conversion at maturity, the financial liability is reclassified to equity and no gain or loss is recognized.

(d) Employee benefits

The pension cost in the interim period was calculated and disclosed on a year-to-date basis by using the actuarially determined pension cost rate at the end of the prior fiscal year.

(e) Income taxes

The income tax expenses have been prepared and disclosed in accordance with paragraph B12 of International Financial Reporting Standards 34, Interim Reporting.

Income tax expenses for the period are best estimated by multiplying pre-tax income for the interim reporting period by the effective annual tax rate as forecasted by the management. This should be recognized fully as tax expense for the current period.

For a change in tax rate that is substantively enacted in an interim period, the effect of the change should immediately be recognized in the interim period in which the change occurs.

Temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their respective tax bases shall be measured based on the tax rates that have been enacted or substantively enacted at the time of the asset or liability is recovered or settled, and be recognized directly in equity or other comprehensive income as tax expense.

(5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty:

The preparation of the consolidated financial statements in conformity with the Regulations and IFRSs (in accordance with IAS 34 “Interim Financial Reporting” and endorsed by the FSC) requires management to make judgments, estimates and assumptions that affect the application of the accounting policies and the reported amount of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Except for the following, the preparation of the consolidated interim financial statements, estimates and underlying assumptions are reviewed on an ongoing basis which are in conformity with the consolidated financial statements for the year ended December 31, 2020. For the related information, please refer to note 5 of the consolidated financial statements for the year ended December 31, 2020.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Information about assumptions and estimation uncertainty that have significant effect on the amounts recognized in the consolidated financial statements is as follow:

(a) Fair value of financial instruments

The fair value of non-active market or non-quoted financial instruments is determined using valuation techniques. The management had to determine the valuation techniques and the nonobservable market parameters to ensure the output result reflects the actual market price. Please refer to note 6(v).

(6) Explanation of significant accounts:

Except for the following disclosures, there is no significant difference as compared with those disclosed in the consolidated financial statements for the year ended December 31, 2020.

Please refer to note 6 of the 2020 annual consolidated financial statements.

(a) Cash and cash equivalents

Cash Demand Deposit Time Deposit	September 30, 2021 $ 6,253 1,001,009 72,195 $ 1,079,457	December 31, 2020 7,922 912,421 329,412 1,249,755	September 30, 2020
			8,551 464,571 743,821
			1,216,943

For bank deposit which original maturity date of bank deposit is less than a year is not for investment but to meet its short-term commitment. It could be transferred into cash and the risk is considered low so was classified as cash and cash equivalents.

(b) Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss: Securities of listed companies Convertible bond securities of listed companies Total Debt investments at fair value through profit or loss Convertible corporate bonds - call options	September 30, 2021 $ 5,976 3,150 $ 9,126 $ 574	December 31, 2020 - - - -	September 30, 2020
			- -
			-
			-

The above financial assets of the Group were not pledged.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Debt investments at fair value through other comprehensive income Unlisted common shares—Foreign Company – LEDLitek Co., Ltd.	September 30, 2021 $ -	December 31, 2020 131,960	September 30, 2020
			106,124

The Group holds 15.39% of common shares of LEDLitek Co., Ltd, and the main operating activities of the Company are Sales car lighting module. The Group designated the investments shown above should recognize as fair value through other comprehensive income, because these investments were intended to be held for long-term strategic purposes. The Group recognized an evaluation loss at fair value amounting to $131,960 under unrealized other comprehensive income (loss) from investments in equity instruments measured at fair value.

Ledionopto Lighting Inc., a sub-subsidiary of the Company, held 500 thousand shares of the Company and had recognized an unrealized gain of $625. Please refer to note6(p).

There were no disposed of investments for the nine months ended September 30, 2021 and 2020 and there were no transfers of any cumulative gain or loss within equity relating to these investments.

The above financial assets of the Group were not pledged.

(d) Financial assets measured at amortized cost

Government international bonds	September 30, 2021 $ 8,722	December 31, 2020 -	September 30, 2020
			-

The Group have assessed that the financial assets are held to maturity to collect contractual cash flows, which consists of payments of principal and interest on principal amount outstanding. Therefore, the investments were classified as financial assets measured at amortized costs.

The above financial assets of the Group were not pledged.

(e) Notes and accounts receivable

Notes receivable Accounts receivable Overdue receivable Less: Loss allowance	September 30, 2021 $ 9,808 433,200 10,526 (27,957) $ 425,577	December 31, 2020 23,068 433,748 2,027 (34,265) 424,578	September 30, 2020 12,918 428,703 2,027 (27,181) 416,467

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

The Group applies the simplified approach to provide for its expected credit losses, i.e. the use of lifetime expected loss provision for all receivables. To measure the expected credit losses, trade receivables have been grouped based on shared credit risk characteristics and the days past due, as well as incorporated forward looking information, including macroeconomic and relevant industry information. The loss allowance provision in Taiwan was determined as follows:

September 30, 2021	September 30, 2021
Gross carrying amount Weighted- average loss rate $ 419,391 0.03% 5,534 2.93% 975 4.8% 17,108 100% $ 443,008 Gross carrying amount Weighted- average loss rate $ 10,526 100% December 31, 2020		Loss allowance provision
		114 162 47 17,108
		17,431
		Loss allowance provision
		10,526

	Weighted- average loss rate 0.38% 4.24% 10.30% 95.23% Weighted- average loss rate 100%	Loss allowance provision
		1,553 530 45 30,110
		32,238
		Loss allowance provision
		2,027

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

September 30, 2020	September 30, 2020
Gross carrying amount $ 404,830 4,315 375 32,101 $ 441,621 Gross carrying amount $ 2,027	Weighted- average loss rate 0.01% 2.92% 7.47% 77.82% Weighted- average loss rate 100%	Loss allowance provision
		18 126 28 24,982
		25,154
		Loss allowance provision
		2,027

Movements of the loss allowance for notes and accounts receivable were as follows:

Balance at January 1 Impairment losses recognized (reversed) Amount written off due to uncollectible in the current year Foreign exchange losses Balance at September 30	For the nine months ended September 30, 2021 2020 $ 34,265 62,522 (6,167) 18,739 - (54,047) (141) (33) $ 27,957 27,181
	2021 $ 34,265 (6,167) - (141) $ 27,957

Note and account receivables of the Group were not pledged.

(f) Inventories

Raw materials Supplies Work in progress Finished goods	September 30, 2021 $ 111,460 3,533 124,025 62,015 $ 301,033	December 31, 2020 100,716 3,084 70,037 91,685 265,522	September 30, 2020
			86,568 3,072 53,740 73,429
			216,809

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

The details of the cost of sales were as follows:

For the three months ended September 30, 2021 2020 $ 367,849 369,864 (4,722) 276 13,099 12,639 $ 376,226 382,779	For the nine months ended September 30,	For the nine months ended September 30,
2021 $ 367,849 (4,722) 13,099 $ 376,226	2021 1,184,951 (7,505) 34,169 1,211,615	2020
		1,159,002 4,546 26,941
		1,190,489

The Group did not provide any inventories as collateral for its loans.

(g) Property, plant and equipment

The cost, depreciation, and impairment of the property, plant and equipment of the Consolidated Company for the nine months ended September 30, 2021 and 2020, were as follows:

Land Cost or decked cost: Balance at January 1, 2021 $ 260,051 Additions 351,073 Disposal - Reclassify 26,738 Effect of movements in exchange rates - Balance at September 30, 2021$ 637,862 Balance at January 1, 2020 $ 260,051 Additions - Disposal - Reclassify - Effect of movements in exchange rates - Balance at September 30, 2020$ 260,051 Deprecation and impairments loss: Balance at January 1, 2021 $ - Depreciation - Disposal - Effect of movements in exchange rates - Balance at September 30, 2021$ -	Building and construction 815,073 78,385 - 77,775 (9,856) 961,377 803,349 1,730 (3,223) 3,597 (3,328) 802,125 231,044 19,540 - (1,627) 248,957	Machinery and equipment 1,229,332 16,667 (78,161) 3,873 (14,441) 1,157,270 1,367,864 20,099 (197,795) 25,935 (6,522) 1,209,581 1,014,435 49,577 (77,207) (11,533) 975,272	Molding equipment 38,871 80 (437) 186 (605) 38,095 38,611 - (112) - (209) 38,290 30,964 1,892 (394) (471) 31,991	Other facilities 204,881 5,967 (1,230) - (3,015) 206,603 214,443 1,439 (13,975) 365 (1,215) 201,057 65,519 9,474 (1,084) (1,811) 72,098	Total 2,548,208 452,172 (79,828) 108,572 (27,917) 3,001,207 2,684,318 23,268 (215,105) 29,897 (11,274) 2,511,104 1,341,962 80,483 (78,685) (15,442) 1,328,318

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Land Balance at January 1, 2020 $ - Depreciation - Disposal - Effect of movements in exchange rates - Balance at September 30, 2020$ - Carrying amounts: Balance at January 1, 2021 $ 260,051 Balance at September 30, 2021$ 637,862 Balance at January 1, 2020 $ 260,051 Balance at September 30, 2020$ 260,051	Building and construction 208,227 17,593 (2,914) (675) 222,231 584,029 712,420 595,122 579,894	Machinery and equipment 1,138,279 51,405 (194,786) (4,994) 989,904 214,897 181,998 229,585 219,677	Molding equipment 27,468 2,677 (61) (130) 29,954 7,907 6,104 11,143 8,336	Other facilities 65,558 10,053 (12,470) (382) 62,759 139,362 134,505 148,885 138,298	Total 1,439,532 81,728 (210,231) (6,181) 1,304,848 1,206,246 1,672,889 1,244,786 1,206,256

(i) Guarantee

Some of the property, plant and equipment that belongs to the Group had been pledged as collateral for short-term borrowings, long-term borrowings and the issuance of the corporate bonds; please refer to note 8.

(ii) Prepaid payments for land and buildings

The Company purchased a new office with $536,000 and had prepaid $107,571 as of December 31, 2020, which was recognized under other non-current assets-other. The remaining balances were paid, and the transferring procedures were completed on January 22, 2021.

(h) Right-of-use assets

The Group leases many assets including land and buildings, machinery and vehicles. Information about leases for which the Group as a lessee was presented below:

Cost: Balance at January 1, 2021 Additions Disposal Effect of changes in foreign exchange rates Balance at September 30, 2021 Balance at January 1, 2020 Additions Disposals Effect of changes in foreign exchange rates Balance at September 30, 2020	Land $ 32,468 - - (531) $ 31,937 $ 31,948 - - (180) $ 31,768	Building and Construction 57,424 3,336 (1,315) (913) 58,532 31,091 37,103 (11,997) (163) 56,034	Machinery equipment - - - - - 173 - (173) - -	Vehicles 5,821 1,134 (582) - 6,373 4,659 1,162 - - 5,821	Total 95,713 4,470 (1,897) (1,444) 96,842 67,871 38,265 (12,170) (343) 93,623

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Accumulated depreciation: Balance at January 1, 2021 Depreciation Disposal Effect of changes in foreign exchange rates Balance at September 30, 2021 Balance at January 1, 2020 Depreciation Disposals Effect of changes in foreign exchange rates Balance at September 30, 2020 Carrying amount: Balance at January 1, 2021 Balance at September 30, 2021 Balance at January 1, 2020 Balance at September 30, 2020	Land $ 1,712 632 - (27) $ 2,317 $ 843 628 - (5) $ 1,466 $ 30,756 $ 29,620 $ 31,105 $ 30,302	Building and Construction 12,264 10,123 (1,251) (187) 20,949 12,207 8,662 (11,997) (59) 8,813 45,160 37,583 18,884 47,221	Machinery equipment - - - - - 112 61 (173) - - - - 61 -	Vehicles 2,235 1,397 (146) - 3,486 657 1,151 - - 1,808 3,586 2,887 4,002 4,013	Total 16,211 12,152 (1,397) (214) 26,752 13,819 10,502 (12,170) (64) 12,087 79,502 70,090 54,052 81,536

(i) Short-term borrowings

The short-term borrowings were summarized as follows:

Secured bank loans Unsecured bank loans Total Unused short-term credit lines Range of interest rates	September 30, 2021 $ 27,850 74,824 $ 102,674 $ 1,421,499 0.85%~1.00%	December 31, 2020 161,853 320,499 482,352 1,152,195 0.16%~1.23%	September 30, 2020
			159,075 264,600
			423,675
			1,100,671
			0.155%~1.4%

For the collateral for short-term borrowings, please refer to note 8.

A key management personnel provided a joint guarantee for the borrowings of the Group from certain financial institutions. Please refer to note 7.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(j) Long-term borrowings

Secured bank loans Less: current portion Total		September 30, 2021 Rate Maturity year Amount 1.1960%~1.1977% 2041 $ 310,880 (16,080) $ 294,800
	Currency TWD	Rate 1.1960%~1.1977%

For the collateral for long-term borrowings, please refer to note 8.

(k) Bonds payable

Bonds payable
				September 30,	December 31,	September 30,
				2021	2020	2020
Total convertible corporate		bonds issued	$	300,000	-	-
Unamortized discounted	corporate bonds			(16,953)	-	-
payable
Cumulative converted amount				(109,700)	-	-
Convertible bonds issued balance			$	173,347	-	-
Embedded derivative-call options
(included in financial	assets at fair value
through profit or loss)			$	574	-	-
Equity components－conversion options
(included in capital surplus－share
options)			$	20,292	-	-
		For the three months ended			For the nine months ended
		September 30,			September 30,
		2021		2020	2021	2020
Interest expense	$	2,054		-	6,525	-
Items			Third unsecured domestic convertible bonds
1.Total issue amount					300,000
2.Par value					100
3.Maturity date				January 25, 2021 ~ January 25, 2024
4.Outstanding period					3 years
5.Coupon rate					0%

6.Redemption at maturity The Company redeems the convertible bond at par value by cash from the bondholders when it meets maturity.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Items	Third unsecured domestic convertible bonds
7.Redemption method	(1) If the closing price of shares for each of 30 consecutive
	trading days is at least 130% of the conversion price between
	the 3 months after the share issuance date and the 40th day
	before the maturity date, the Company may redeem all the
	outstanding bonds at their par vale.
	(2) If the amount outstanding of bonds is less than 10% of the
	principal amount between the 3 months after the share
	issuance date and the 40th day before the maturity date, the
	Company may redeem the outstanding bonds at their principal
	amount within five business days before the maturity date.
8.Conversion period	(1) The bondholder can convert its bonds into shares at any time
	between 3 months after the issuance date and the day before
	the maturity day.
	(2) For the circumstances below, the conversion terminates in
	compliance with the method issued by the Company.
	The closing period in accordance with the applicable laws.
	The period that starts from the fifteen business days prior to
	the date of record for determination wherein the shareholders
	are entitled to receive the distributions or rights to subscribe
	for new shares in a capital increase for cash, and ends on the
	date of record for the distribution of the rights/benefits. The
	period starts from the date of record of the capital decrease
	and ends one day prior to the reissuance of the trading of
	shares after the capital decrease.
9.Conversion price	The conversion price is $19.3 per share when issuance.
	The Company announced on July 29, 2021 that due to the
	allotment of cash dividends on the ordinary shares, the conversion
	price has been adjusted from $19.3 to $19.1 since August 21,
	2021.
10. Pledge	For the collateral for bonds payable, please refer to note 8.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(l) Lease liability

The carrying values of the lease liabilities were as follows:

Current Non-current	September 30, 2021 $ 15,140 $ 28,954	December 31, 2020 11,916 39,229	September 30, 2020
			12,313
			40,669

For the maturity analysis, please refer to note 6(v).

The amounts recognized in profit or loss were as follows:

For the three months ended September 30, 2021 2020 $ 1,513 990 $ 336 255 $ 40 45	For the three months ended September 30, 2021 2020 $ 1,513 990 $ 336 255 $ 40 45	For the nine months ended September 30, 2021 2020 4,855 2,416 930 784 137 142	For the nine months ended September 30, 2021 2020 4,855 2,416 930 784 137 142
2021 $ 1,513 $ 336 $ 40		2021 4,855 930 137
	990		2,416
	255		784
	45		142

The amounts recognized in the statement of cash flows for the Group were as follows:

Total cash outflow for leases	For the nine months ended September 30, 2021 2020 $ 16,123 12,801	For the nine months ended September 30, 2021 2020 $ 16,123 12,801
	2021 $ 16,123
		12,801

(i) Real estate leases

The Group leases building for its employee dormitories and plant offices. The lease terms ranged for a period of 1 to 2 years and 2 to 5 years for employee dormitories and plant offices, respectively. Some of the terms can be extended upon maturity. However, if the option of extension is uncertain, the related expenditures incurred in the covered period cannot be accounted for as lease liabilities.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(ii) Other leases

The Group leases machinery and vehicle, with lease terms ranging for a period of 4 to 5 years. Some of the terms can be extended upon maturity. However, if the option of extension is uncertain, the related expenditures incurred in the covered period would not be accounted for as lease liabilities.

Some buildings leased by the Group have a term with no more than a year are considered as short-term leases. Therefore, the Group decided to apply the exemption for recognition to recognize its right of use assets and lease liabilities.

(m) Deferred income

The agreement between Yangzhou Edison Opto Corporation and Yangzhou Land And Resources Bureau entitled right of land use of Yangzhou Economic Development Zone, from December, 2006 to December, 2056. The right of land use of CNY 9,788 thousand is subsidized by the Administrative Commission of Yangzhou Economic Development Zone, generating the long-term deferred revenue of CNY 9,393 thousand recognized under other non-current liabilities and is amortized for 50 years to recognize revenue. As of September 30, 2021, December 31, 2020 and September 30, 2020, the amount of unamortized deferred revenue was $28,425, $29,514 and $29,079, respectively.

(n) Employee benefits

(i) Defined benefit plans

Management believes that there was no material volatility of the market, no material reimbursement and settlement or other material one-time events since prior fiscal year. As a result, the pension cost in the accompanying interim period was measured and disclosed according to the actuarial report as of December 31, 2020 and 2019.

The expenses recognized in profit or loss for the Group were as follows:

For the three months ended September 30, 2021 2020 $ 36 65 103 185 $ 139 250	For the nine months ended September 30, 2021 2020 169 264 329 484 498 748	For the nine months ended September 30, 2021 2020 169 264 329 484 498 748
2021 $ 36 103 $ 139	2021 169 329 498
		264 484
		748

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(ii) Defined contribution plans

The Group’s expenses under the pension plan cost to the Bureau of Labor Insurance were as follows:

For the three months ended September 30, 2021 2020 $ 3,027 465 2,057 816 $ 5,084 1,281	For the nine months ended September 30,	For the nine months ended September 30,
2021 $ 3,027 2,057 $ 5,084	2021 8,767 5,919 14,686	2020
		2,916 3,334
		6,250

(o) Income taxes

(i) The components of income tax were as follows:

For the three months ended September 30, 2021 2020 $ 2,627 3,315 - - $ 2,627 3,315	For the nine months ended September 30,	For the nine months ended September 30,
2021 $ 2,627 - $ 2,627	2021 9,969 - 9,969	2020
		9,691 -
		9,691

(ii) Assessment of tax

The Company’s tax returns for the years through 2018 were assessed by the Taipei National Tax Administration.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(p) Capital and other equity

Except for the following disclosure, there was no significant change for capital and other equity for the periods from January 1 to September 30, 2021 and 2020. For the related information, please refer to note 6(o) of the consolidated financial statements for the year ended December 31, 2020. Please refer to note 6(v) for changes of other equity.

(i) Issuance and cancellation of ordinary shares

The Company recalled and cancelled of 827 thousand restricted employee stocks and 1,618 thousand treasury shares, respectively. Furthermore, the Company recalled and cancelled of 33 thousand restricted employee stocks in July 2021. The statutory registration procedures of all the above-mentioned cancellations had been completed as of the reporting date.

The unsecured domestic convertible bonds issued by the Company were converted into 5 thousand ordinary shares and 5,679 thousand ordinary shares due to the exercise of the conversion rights by the bondholders in the second and third quarters of 2021, respectively. The related registration procedures were completed in July 2021 and October 2021, respectively.

(ii) Capital surplus

The balances of capital surplus were as follows:

Share capital Employee share options Difference arising from subsidiary’s share price and its carrying value Restricted employee stocks Conversion options	September 30, 2021 $ 1,493,980 72,142 14,753 27,047 20,292 $ 1,628,214	December 31, 2020 September 30, 2020 1,439,858 1,439,808 72,142 72,142 14,381 14,381 27,196 27,195 - - 1,553,577 1,553,526

On June 16, 2020, the Company’s shareholders approved to distribute the cash dividend of $12,300 by capital surplus. Each share could receive a cash dividend of $0.10081853 from capital reserve.

(iii) Retained earnings

1) Earnings distribution

A resolution was made during the shareholders' meeting held on July 15, 2021, to distribute a cash dividend of $40,000. Each share could receive a cash dividend of $0.33457. A resolution was approved during the shareholders' meeting held on June 16, 2020, to cover the deficit, so there were no earnings distribution.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(iv) Treasury shares
1) Ledionopto Lighting Inc., sub-subsidiary of the Company, held 500 thousand shares of the Company’s treasury share. As of September 30, 2021, all treasury shares were not sold and the market price on September 30, 2021, December 31 and September 30, 2020, was $20.55 , $19.30 and $11.25 per share, respectively.
2) In compliance with the Securities and Exchange Act, treasury shares held by the Group should not be pledged, and shareholder rights are not entitled before the transfer.

(q) Share-based payment

Except for the following disclosure, there were no significant changes for share-based payment during the periods from January 1 to September 30, 2021 and 2020. For the related information, please refer to note 6(p) of the consolidated financial statements for the year ended December 31, 2020.

(i) Expense recognized in profit or loss

The Group incurred expenses of share-based arrangements in 2021 and 2020 as follows:

For the three months ended September 30, 2021 2020 Expenses resulting from restricted employee stocks (reversal) $ 290 (7,091)	For the nine months ended September 30, 2021 2020 3,833 (566)
	2021 3,833

(r) Earnings per share

The calculation of basic earnings per share and diluted earnings per share is as follows:

For the three months ended September 30, 2021 2020 $ 24,486 25,781 122,244 118,383 $ 0.20 0.22 $ 24,486 25,781 1,644 -	For the nine months ended September 30,	For the nine months ended September 30,
2021 $ 24,486 122,244 $ 0.20 $ 24,486 1,644	2021 94,903 119,337 0.80 94,903 5,220	2020
		30,551
		119,282
		0.26
		30,551 -

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

For the three months ended September 30, $ 26,130 25,781 $ 122,244 118,383 51 - 11,897 - 570 1,182 134,762 119,565 $ 0.19 0.22	For the nine months ended September 30, 100,123 30,551 119,337 119,282 275 - 12,639 - 972 1,727 133,223 121,009 0.75 0.25	For the nine months ended September 30, 100,123 30,551 119,337 119,282 275 - 12,639 - 972 1,727 133,223 121,009 0.75 0.25
$ 26,130 $ 122,244 51 11,897 570 134,762 $ 0.19	100,123 119,337 275 12,639 972 133,223 0.75
		119,282
		-
		- 1,727
		121,009
		0.25

(s) Revenue from contracts with customers

(i) Revenue detail

		For the three mo	nths ended September 30, 2021	nths ended September 30, 2021
The Company $ 16,690 91,264 41,465 8,935 61,774 $ 220,128 $ 8,236 66,738 139,155 - 5,999 $ 220,128	Edison Opto (Dong Guan) Co., Ltd 91,697 - - - - 91,697 46,462 2,993 36,709 - 5,533 91,697	Yangzhou Edison Opto Corporation 55,016 - - - 359 55,375 - 44,534 10,537 - 304 55,375	Yangzhou Edison-Litek Opto Corporation 6,775 621 - - - 7,396 - - - 7,173 223 7,396	Edison- Litek Opto Corporation - 64,734 1,792 - 81 66,607 - - - 66,526 81 66,607	Other 2,034 38,812 384 - 2,999 44,229 - 14,009 23,295 5,672 1,253 44,229	Total 172,212 195,431 43,641 8,935 65,213
						485,432
						54,698 128,274 209,696 79,371 13,393
						485,432

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

		For the three mo	nths ended September 30, 2020	nths ended September 30, 2020
The Company	Edison Opto (Dong Guan) Co., Ltd. 95,224 - - - - 95,224 63,770 6,442 24,832 - 180 95,224	Yangzhou Edison Opto Corporation 79,926 - - - 104 80,030 - 56,904 7,003 - 16,123 80,030	Yangzhou Edison-Litek Opto Corporation 14,950 167 - - - 15,117 - - - 15,117 - 15,117	Edison- Litek Opto Corporation - 69,304 12 - 24 69,340 - - - 69,340 - 69,340	Other - 25,527 363 4,266 3,244 33,400 - 6,367 15,405 10,662 966 33,400	Total 211,710 144,539 23,432 13,130 85,621
$ 21,610 49,541 23,057 8,864 82,249 $ 185,321 $ 13,228 67,912 103,472 - 709 $ 185,321
						478,432
						76,998 137,625 150,712 95,119 17,978
						478,432

		For the nine mo	nths ended September 30, 2021	nths ended September 30, 2021
The Company $ 57,836 202,804 142,626 23,975 192,260 $ 619,501 $ 33,795 211,911 350,886 - 22,909 $ 619,501	Edison Opto (Dong Guan) Co., Ltd. 295,848 - - - - 295,848 151,059 6,293 119,552 - 18,944 295,848	Yangzhou Edison Opto Corporation 208,334 - - - 3,577 211,911 - 165,285 35,972 - 10,654 211,911	Yangzhou Edison-Litek Opto Corporation 26,037 977 - - - 27,014 - - - 26,692 322 27,014	Edison-Litek Opto Corporation - 312,400 4,436 - 4,002 320,838 - - - 316,836 4,002 320,838	Other 5,957 109,294 649 - 15,150 131,050 - 37,192 75,535 16,367 1,956 131,050	Total 594,012 625,475 147,711 23,975 214,989
						1,606,162
						184,854 420,681 581,945 359,895 58,787
						1,606,162

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements


Edison Opto (Dong Guan) Co., Ltd. Yangzhou Edison Opto Corporation Yangzhou Edison-Litek Opto Corporation Edison-Litek Opto Corporation 254,903 212,964 36,243 - - - 2,577 217,454 - - - 27 - - - - - 335 17 2,632 254,903 213,299 38,837 220,113 139,723 - - - 10,972 150,716 - - 103,615 30,590 - - - - 37,962 220,113 593 31,993 875 - 254,903 213,299 38,837 220,113 September 30, 2021 December 31, 2020 $ 9,808 23,068 433,200 433,748 (17,431) (32,238) $ 425,577 424,578	Other Total 1,623 545,969 71,912 441,720 392 68,789 8,203 156,319 8,335 246,421 90,465 1,459,218 - 166,095 15,355 392,508 58,891 585,258 14,507 272,582 1,712 42,775 90,465 1,459,218 September 30, 2020 12,918 428,703 (25,154) 416,467	Total 545,969 441,720 68,789 156,319 246,421
		1,459,218
		166,095 392,508 585,258 272,582 42,775
		1,459,218

For details on accounts receivable and allowance for impairment, please refer to note 6(e).

(t) Employee compensation and directors' remuneration

In accordance with the Articles of incorporation, the Company should contribute 5%~15% of the profit as employee compensation and less than 3% as directors' remuneration when there is profit for the year. However, if the Company has accumulated deficits, the profit should be reserved to offset the deficit. The amount of remuneration of each director and of compensation for employees entitled to receive the abovementioned employee compensation is approved by the Board of Directors. The recipients of shares and cash may include the employees of the Company’s affiliated companies who meet certain conditions.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

The employees’ compensation for the three months and nine months period ended September 30, 2021, were $1,300 and $5,100, respectively. The directors’ remuneration for the three months and nine months period ended September 30, 2021, were $425 and $1,525, respectively. The calculation is based on the Company’s net income before tax excluding employees’ compensation, directors’ remuneration and recovery of deficit that multiplied by the percentage of employees’compensation and remuneration to directors. The compensations and remunerations were expensed under operating costs or operating expenses during the period. There were no estimated employees’ compensation and directors' remuneration for the three months and nine months period ended September 30, 2020, as the amount were immaterial. The employees’ compensation and directors’remuneration for the year ended September 30, 2020, were $2,250 and $450, respectively. There were no employees' compensation and directors’ remuneration for the year ended December 31, 2019, as the Company had suffered in loss. Related information would be available at the Market Observation Post System website.

(u) Non-operating income and expenses

(i) Interest income

The details of net other income were as follows:

For the three months ended September 30, 2021 2020 $ 1,616 2,008 2,417 1,912 $ 4,033 3,920	For the nine months ended September 30,	For the nine months ended September 30,
2021 $ 1,616 2,417 $ 4,033	2021 5,970 4,990 10,960	2020
		6,180 8,619
		14,799

(ii) Other income

The details of net other income were as follows:

Other income- others	For the three months ended September 30, 2021 2020 $ 1,301 10,496	For the nine months ended September 30,	For the nine months ended September 30,
	2021 $ 1,301	2021 3,917	2020
			16,530

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(iii) Other gains and losses

The details of other gains and losses were as follows:

Net gain on disposal of Property, plant, and equipment Net gain on financial assets at fair value Net gain (losses) on foreign exchange Others	For the three months ended September 30, 2021 2020 $ 3,346 12,566 143 - 446 (5,418) (2,287) (1,342) $ 1,648 5,806	For the nine months ended September 30, 2021 2020 3,044 11,136 3,940 - (5,351) (5,845) (8,384) (2,406) (6,751) 2,885
	2021 $ 3,346 143 446 (2,287) $ 1,648	2021 3,044 3,940 (5,351) (8,384) (6,751)

(iv) Finance costs

The details of finance costs were as follows:

Interest expenses	For the three months ended September 30, 2021 2020 $ 4,797 1,895	For the nine months ended September 30,	For the nine months ended September 30,
	2021 $ 4,797	2021 15,483	2020
			6,414

(v) Financial instruments

Except for the contention mentioned below, there was no significant change in the fair value of the Group’s financial instruments and degree of exposure to credit risk, liquidity risk and market risk arising from financial instruments. For the related information, please refer to note 6(u) of the consolidated financial statements for the year ended December 31, 2020.

(i) Credit risk

1) Concentration of credit risk

Accounts receivable were due from many customers. Therefore, there was no concentration of credit risk. In order to reduce the credit risk of accounts receivable, the Company continually evaluates each customer’ s financial situation. Otherwise, the customer will have to provide bank guarantees or collaterals.

2) Receivable

For credit risk exposure of note and trade receivables, please refer to note 6(e). Other financial assets at amortized cost includes other receivables and time deposits.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

All of these financial assets are considered to have low risk, and thus, the impairment provision recognized during the period was limited to 12 months expected losses. Regarding how the financial instruments are considered to have low credit risk, please refer to note 4(g) of the consolidated financial statements for the year ended December 31, 2020.

(ii) Liquidity risk

The following table shows the contractual maturities of financial liabilities, including estimated interest payments and excluding the impact of netting agreements.

Carrying amount September 30, 2021 Non-derivative financial liabilities Secured loans $ 338,730 Unsecured loans 74,824 Lease liabilities 44,094 Notes payable and accounts payable 317,801 Other payable 110,994 Bonds payable 173,347 $ 1,059,790 December 31, 2020 Non-derivative financial liabilities Secured loans $ 161,853 Unsecured loans 320,499 Lease liabilities 51,145 Notes payable and accounts payable 369,907 Other payable 110,128 $ 1,013,532 September 30, 2020 Non-derivative financial liabilities Secured loans $ 159,075 Unsecured loans 264,600 Lease liabilities 52,982 Notes payable and accounts payable 291,914 Other payable 94,377 $ 862,948	Contractual cash flows (374,877) (74,942) (54,193) (317,801) (110,994) (190,300) (1,123,107) (161,999) (320,622) (65,684) (369,907) (110,128) (1,028,340) (159,201) (264,690) (68,952) (291,914) (94,377) (879,134)	Within 6 months (37,776) (74,942) (10,097) (317,801) (110,994) - (551,610) (161,999) (320,622) (9,663) (369,907) (110,128) (972,319) (159,201) (264,690) (9,444) (291,914) (94,377) (819,626)	6-12 months (9,836) - (9,975) - - - (19,811) - - (9,204) - - (9,204) - - (9,195) - - (9,195)	1-2 years (19,509) - (14,862) - - - (34,371) - - (18,051) - - (18,051) - - (17,776) - - (17,776)	2-5 years (57,401) - (19,259) - - (190,300) (266,960) - - (28,766) - - (28,766) - - (32,537) - - (32,537)	Over 5 years (250,355) - - - - -
						(250,355)
						- - - - -
						-
						- - - - -
						-

The Group does not expect the cash flows included in the maturity analysis to occur significantly earlier or at significantly different amounts.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(iii) Currency risk
1) Exposure to foreign currency risk

The Consolidated Company’ s significant exposure to foreign currency risk was as follows:

Fi		September 30, 2021			December 31, 2020		September 30, 2020
	Foreign currency $ 12,533 6,270 28,005 13,023 461 190	Exchange rate USD/TWD= 27.8500 USD/CNY= 6.4854 CNY/TWD= 4.2945 USD/TWD= 27.8500 USD/CNY= 6.4854 CNY/TWD= 4.2945	TWD	Foreign currency 6,769 4,448 28,045 15,722 3,424 129	Exchange rate USD/TWD= 28.4800 USD/CNY= 6.5249 CNY/TWD= 4.3770 USD/TWD= 28.4800 USD/CNY= 6.5249 CNY/TWD= 4.3770	Foreign currency 8,470 7,064 113,134 16,486 2,932 3,548	Exchange rate TWD USD/TWD= 29.1000 246,477 USD/CNY= 6.8101 205,505 CNY/TWD= 4.2719 483,295 USD/TWD= 29.1000 479,743 USD/CNY= 6.8101 85,298 CNY/TWD= 4.2719 15,157
			349,044 174,628 120,267 362,691 12,839 816
Fi

2) Sensitivity analysis

The Group’s exposure to foreign currency risk arises from the translation of the foreign currency exchange gains and losses on cash and cash equivalents, trade and other receivables, loans and borrowings; and trade and other payables that are denominated in foreign currency.

A strengthening (weakening) of 5% of the TWD against the USD and CNY as at September 30, 2021 and 2020 would have increased (decreased) the equity by $13,380 and $17,753 due to cash flow hedges. The analysis assumes that all other variables remain constant and ignores any impact of forecasted sales and purchases. The analysis is performed on the same basis for prior year.

Since the Consolidated Company has many kinds of functional currency, the information on foreign exchange gain (loss) on monetary items is disclosed by total amount. For the nine months ended September 30, 2021 and 2020, foreign exchange gain (loss) (including realized and unrealized portions) amounted to $(5,351) and $(5,845), respectively.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(iv) Fair value of financial instruments

1) The fair value of financial assets at fair value through profit or loss and financial assets at fair value through other comprehensive income (available for sale financial assets) is measured on a recurring basis. The carrying amount and fair value of the Group’ s financial assets and liabilities, including the information on fair value hierarchy were as follows; however, except as described in the following paragraphs, for financial instruments not measured at fair value whose carrying amount is reasonably close to the fair value, and lease liabilities, disclosure of fair value information is not required :

September 30, 2021

	Fair Value	Fair Value
Level 1 5,976 3,150 - - - - - - 9,126 - - - - - -	Level 2 - - 574 - - - - - 574 - - - - - -	Level 3 - - - - - - - - - - - - - - -	Total
			5,976
			3,150
			574
			- - - -
			-
			9,700
			- - - - -
			-

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

	December 31, 2020	December 31, 2020	December 31, 2020
Book value $ 131,960 $ 1,249,755 424,578 2,028 1,676,361 $ 1,808,321 $ 482,352 369,907 110,128 51,145 $ 1,013,532		Fair value
	Level 1 Level 2 Level 3 - - 131,960 - - - - - - - - - - - - - - 131,960 - - - - - - - - - - - - - - - September 30, 2020			Total
				131,960
				- - -
				-
				131,960
				- - - -
				-

Book value $ 106,124 $ 1,216,943 416,467 3,908 1,637,318 $ 1,743,442 $ 423,675 291,914 94,377 52,982 $ 862,948		Fair value
	Level 1 - - - - - - - - - - -	Level 2 - - - - - - - - - - -	Level 3 106,124 - - - - 106,124 - - - - -	Total
				106,124
				- - -
				-
				106,124
				- - - -
				-

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

2) Reconciliation of Level 3 fair values

January 1, 2021 Total gains and losses recognized: In other comprehensive income September 30, 2021 January 1, 2020 Total gains and losses recognized: In other comprehensive income September 30, 2020	Fair value through other comprehensive income $ 131,960 (131,960) $ - $ 106,631 (507) $ 106,124

For the nine months ended September 30, 2021 and 2020, total gains and losses that were included in unrealized gains and losses from financial assets at fair value through other comprehensive income were as follows:

Total gains and losses recognized: In other comprehensive income, and presented in “unrealized gains and losses from financial assets at fair value through other comprehensive income”	For the three months ended September 30, 2021 2020 $ - -	For the nine months ended September 30, 2021 2020 (131,960) (507)
	2021 $ -

3) Quantified information on significant unobservable inputs (Level 3) used in fair value measurement

The Group’s financial instruments that use Level 3 inputs to measure fair value include “financial assets measured at fair value through profit or loss – debt investments” and “fair value through other comprehensive income (available-for-sale financial assets) – equity investments”.

Most fair values in Level 3 include one significant unobservable input, and the fair values of investments in equity instrument without active market consist of multiple significant unobservable inputs. Therefore, significant unobservable inputs of investments in equity instrument without active market are independent with no interrelationship.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Quantified information of significant unobservable inputs was as follows:

Inter-relationship between significant Valuation Significant unobservable unobservable inputs and Item technique inputs fair value measurement Financial assets at fair Weighted average of ‧ equity ratio multiple ‧ The higher multiple, value through other market comparable ‧ Discount for lack of the higher the fair comprehensive income companies and assetmarketability value equity investments based approach ‧ Discount of control ‧ The higher the without an active market discount for lack of marketability, the lower the fair value ‧ The higher the discount of control, the lower the fair value

－
4) Fair value measurements in Level 3 sensitivity analysis of reasonably possible alternative assumptions

The fair value measurement of financial instruments by the Consolidated Company is reasonable, but the use of different evaluation models or evaluation parameters may result in different evaluation results. For fair value measurements in Level 3, if the evaluation parameters change, would have the following effects of profit or loss or other comprehensive income:

September 30, 2021 Financial assets fair value through other comprehensive income December 31, 2020 Financial assets fair value through other comprehensive income September 30, 2020 Financial assets fair value through other comprehensive income	Input 1.49 2.28 1.81	Change	Recognized in other comprehensive income Favorable change Unfavorable change 204 (204) 1,320 (1,320) 1,171 (1,171)
		1% 1% 1%

The favorable and unfavorable effects represent the changes in fair value, and fair value is based on a variety of unobservable inputs calculated using a valuation technique. The analysis above only reflects the effects of changes in a single input, and it does not include the interrelationships with another input.

(w) Financial risk management

There were no significant changes in the Group's financial risk management and policies as disclosed in Note 6(v) of the consolidated financial statements for the year ended December 31, 2020.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(x) Capital management

Management believes that the objectives, policies and processes of capital management of the Group has been applied consistently with those described in the consolidated financial statements for the year ended December 31, 2020. Also, management believes that there were no significant changes in the Group's capital management information as disclosed for the year ended December 31, 2020. Please refer to Note 6(w) of the consolidated financial statements for the year ended December 31, 2020 for further details.

(y) Financing activities not affecting current cash flow

The Group’ s financing activities which did not affect the current cash flow for the nine months ended September 30, 2021 and 2020, were as follows:

	Non-cash changes	September 30, 2021 102,674 44,094 310,880 173,347
Foreign exchange movement Changes in lease payments 7,890 - (864) 8,869 - - - - 7,026 8,869 Non-cash changes
		630,995

Foreign exchange movement 17,159 (139) 17,020	Changes in lease payments

(7) Related-party transactions:

(a) Names and relationship with related parties

The followings are entities that have had transactions with related party during the periods covered in the consolidated financial statements:

Name of related party Relationship with the Group Wu, Chien-Jung The Company’s chairman

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(b) Key management personnel compensation

Key management personnel compensation comprised:

Short-term employee benefits Post employment benefits Share-based payments	For the three months ended September 30, 2021 2020 $ 7,475 7,643 198 227 134 (1,570) $ 7,807 6,300	For the nine months ended September 30, 2021 2020 23,143 26,370 564 502 1,317 (125) 25,024 26,747
	2021 $ 7,475 198 134 $ 7,807	2021 23,143 564 1,317 25,024

Please refer to note 6(q) for further explanations related to share-based payment transactions.

(c) Significant transactions with related parties
(i) Guarantee

A key management personnel provided a joint guarantee for the borrowings of the Group from certain financial institutions.

(8) Pledged assets:

The carrying values of pledged assets were as follows:

Pledged assets	Object	September 30, 2021 $ 12,334 20,000 11,003 10,330 200,556 - 529,855 $ 784,078	December 31, 2020 17,312 - 114,278 8,179 202,015 - - 341,784	September 30, 2020
Deposits (classified under current assets) Deposits (classified under current assets) Deposits (classified under current assets) Deposits (classified under non-current assets) Property, plant, and equipment Property, plant, and equipment Property, plant, and equipment	The guarantee letter of credit Tender deposit Short-term loans Deposit to customs Guarantee of Corporate Bonds Short-term loans Long-term loans			17,542 - 108,981 8,085 - 55,126 -
				189,734

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(9) Commitments and contingencies:

The Consolidated Company’s unrecognized contractual commitments are as follows:

Acquisition of property, plant and equipment	September 30, 2021 $ 76,189	December 31, 2020 September 30, 2020 429,869 8,659

(10) Losses Due to Major Disasters: None.

(11) Subsequent Events: None.

(12) Other:

(a) A summary of current-period employee benefits, depreciation, and amortization, by function, is as follows:

By function By item		For the three months ended September 30,	For the three months ended September 30,	For the three months ended September 30,	For the three months ended September 30,
		2021			2020
	Cost of sales	Operating expenses	Total	Cost of sales	Operating expenses	Total
Employee benefits Salary Labor and health insurance Pension Directors’ remuneration Others Depreciation Amortization	35,111 2,187 3,063 - 4,286 21,869 3	36,399 2,572 2,160 611 2,558 8,138 532	71,510 4,759 5,223 611 6,844 30,007 535	38,055 2,181 530 - 3,724 23,554 35	28,607 2,235 1,001 150 1,964 8,760 586	66,662 4,416 1,531 150 5,688 32,314 621

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

By function By item		For the nine months ended September 30,	For the nine months ended September 30,	For the nine months ended September 30,	For the nine months ended September 30,
		2021			2020
	Cost of sales	Operating expenses	Total	Cost of sales	Operating expenses	Total
Employee benefits Salary Labor and health insurance Pension Directors’ remuneration Others Depreciation Amortization	117,249 6,851 8,936 - 12,436 68,892 49	125,164 7,919 6,248 2,053 6,778 23,743 1,636	242,413 14,770 15,184 2,053 19,214 92,635 1,685	110,927 5,801 3,180 - 11,328 69,575 105	103,660 7,066 3,818 534 6,382 22,655 1,791	214,587 12,867 6,998 534 17,710 92,230 1,896

(b) The operation of the Group is not affected by seasonal or periodic factors.

(13) Other disclosures:

(a) Information on significant transactions:

The following is the information on significant transactions required by the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” for the Consolidated Company:

(i) Loans to other parties:

(In Thousands of New Taiwan Dollars)

Number	Name of lender	Name of borrower	Account name	Related party	Highest balance of financing to other parties during the period (Note 2)	Ending balance (Note 2)	Actual usage amount during the period	Range of interest rates during the period	Purposes of fund financing for the borrower	Transaction amount for business between two parties	Reasons for short-term financing	Allowance for bad debt	Collateral	Collateral	Individual funding loan limits	Maximum limit of fund financing
													Item	Value
1 2 3	Yangzhou Edison Opto Corporation Yangzhou Edison Opto Corporation Edison-litek Opto Corporation Limited	Yangzhou Edison-Litek Opto Corporation Edison- Opto (Dong Guan) Co., Ltd. Edison-litek Opto Corporation	Other receivables due from related parties Other receivables due from related parties Other receivable due from related parties	Yes Yes Yes	26,318 (CNY6,000 thousand) 43,863 (CNY10,000 thousand) 31,389 (USD1,100 thousand)	25,767 (CNY6,000 thousand) 42,945 (CNY10,000 thousand) 30,635 (USD1,100 thousand)	- - 30,635 (USD1,100 thousand)	1% 1% 1%	2 2 2	- - -	Short-term financing Short-term financing Short-term financing	- - -	- - -	- - -	232,277 (Note1) 232,277 49,308 (Note1)	464,554 (Note1) 464,554 98,615 (Note1)

Note 1: The allowable aggregate amount of financing provided to others cannot exceed 40% of the lender's stockholders' equity, the maximum amount of financing provided to an individual counterparty cannot exceed 20% of the lender's stockholders' equity.

Note 2: The amount was the financing facility approved by the Board of Directors. Note 3: Based on the Company's guidelines, the allowable amounts of financing are as follows:

(1) Loan arrangement for business transaction
(2) Short-term financing purpose

Note 4: The amount was eliminated in the consolidated financial statements.

(ii) Guarantees and endorsements for other parties: None.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(iii) Securities held as of September 30, 2021 (excluding investment in subsidiaries, associates and joint ventures):

(In Thousands of shares)

Name of holder	Category and name of security	Relationship with company	Account title	Endingbalance	Endingbalance	Endingbalance	Endingbalance	Note
				Shares/Units (thousands)	Carryingvalue	Percentage of ownership (%)	Fair value
Edison Fund Investment Corporation The Company Edison Fund Investment Corporation Edison Fund Investment Corporation	Yang Ming Marine Corp. Merry Electronics Co., Ltd.- Convertible bonds Taipei Fubon Bank- Qatar Government International Bonds LED Litek Co., Ltd.	NO NO NO NO	Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Financial assets measured at amortized cost-current Financial assets at fair value through other comprehensive income-non-current	50 30 - 124	5,976 3,150 8,722 -	% - % - % - % 15.39	5,976 3,150 8,722 -	note

Note: Those without public market price will be shown in market approach.

(iv) Individual securities acquired or disposed of with accumulated amount exceeding the lower of NT$300 million or 20% of the capital stock:

(In Thousands of New Taiwan Dollars)

Name of company	Category and name of security	Account name	Name of counter-party	Relationship with the company	Beginning Balance	Beginning Balance	Purchases	Purchases	Sales	Sales	Sales	Sales	Ending Balance	Ending Balance
					Shares	Amount	Shares	Amount	Shares	Price	Cost	Gain (loss) on disposal	Shares	Amount
Yangzhou Edison Opto Corporation	Bank of Communication Co., Ltd. RMB structured deposits of Bank of communications- RMB financial product (exchange rate and binary option related)	Current financial assets at fair value through profit or loss	Bank of Communication Co., Ltd.	-	-	-	-	1,234,669 (RMB287,500 thousand)	-	1,237,183 (RMB288,086 thousand)	1,234,669	2,514	-	-

(v) Acquisition of individual real estate with amount exceeding the lower of NT$300 million or 20% of the capital stock:

(In Thousands of New Taiwan Dollars)

Name of company	Name of property	Transaction date	Transaction amount	Status of payment	Counter-party	Relationship with the Company	If the counter-party is a related party, disclose the previous transfer information	If the counter-party is a related party, disclose the previous transfer information	If the counter-party is a related party, disclose the previous transfer information	If the counter-party is a related party, disclose the previous transfer information	References for determining price	Purpose of acquisition and current condition	Others
							Owner	Relationship with the Company	Date of transfer	Amount
he ompany	Taiwan Tech. Square 17F	2020.11	536,000	536,000	Telin Construction Group	Non-related				-	Appraisal of real estate	Group operating demand	None

(vi) Disposal of individual real estate with amount exceeding the lower of NT$300 million or 20% of the capital stock: None.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(vii) Related-party transactions for purchases and sales with amounts exceeding the lower of NT$100 million or 20% of the capital stock:

(In Thousands of New Taiwan Dollars)

Name of company	Related party	Nature of relationship	Transaction details	Transaction details	Transaction details	Transaction details	Transactions w from	ith terms different others	Notes/Accounts receivable (payable)	Notes/Accounts receivable (payable)	Note
			Purchase/ Sales	Amount	Percentage of total purchases/sales	Payment terms	Unit price	Payment terms	Ending balance	Percentage of total notes/accounts receivable (payable)
Edison Opto (Dong Guan) Co., Ltd. T The Company E ( L Yangzhou Edison Opto Corporation T The Company Y O Yangzhou Edison- Litek Opto Corporation E C Edison-Litek Opto Corporation Y L C	he Company dison Opto Dong Guan) Co., td. he Company angzhou Edison pto Corporation dison-Litek Opto orporation angzhou Edison- itek Opto orporation	Parents Subsidiary Parent Company Subsidiary Sub-subsidiary Sub-subsidiary	Sales Purchase Sales Purchase Sales Purchase	(223,493) 223,493 (270,680) 270,680 (161,167) 161,167	% 42.10 % 35.90 % 47.82 % 43.48 % 85.64 % 72.57	90 days 90 days 90 days 90 days 90 days 90 days	No significant difference No significant difference No significant difference No significant difference No significant difference No significant difference	- - - - - -	(20,691) 20,691 57,611 (57,611) 24,181 (24,181)	% 16.67 % 10.04 % 35.90 % 44.72 % 59.19 % 48.86

Note: The above transactions have been written off during the preparation of the consolidated report.

(viii) Receivables from related parties with amounts exceeding the lower of NT$100 million or 20% of the capital stock: None
(ix) Trading in derivative instruments: None
(x) Business relationships and significant intercompany transactions:

(In Thousands of New Taiwan Dollars)

No.	Name of company	Name of counter-party	Nature of relationship		Intercompany transactions	Intercompany transactions	Intercompany transactions
				Account name	Amount	Trading terms	Percentage of the consolidated net revenue or total assets
0 0 0 0 0 1 1 1 1	The Company The Company The Company The Company The Company Yangzhou Edison Opto Corporation Yangzhou Edison Opto Corporation Yangzhou Edison Opto Corporation Yangzhou Edison Opto Corporation	Yangzhou Edison Opto Corporation Edison Opto (Dong Guan) Co., Ltd. Edison Opto (Dong Guan) Co., Ltd. Edison Opto USA Corporation Edison Opto USA Corporation The Company The Company Edison-Egypt Opto Corporation Edison-Egypt Opto Corporation	1 1 1 1 1 2 2 3 3	Sales Sales Accounts receivable Sales Accounts receivable Sales Accounts receivable Sales Accounts receivable	40,079 86,539 20,691 45,561 20,545 270,680 57,611 40,965 17,484	90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days	2.50% 5.39% 0.54% 2.84% 0.53% 16.85% 1.49% 2.55% 0.45%

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

No.	Name of company	Name of counter-party	Nature of relationship	Intercompany transactions	Intercompany transactions	Intercompany transactions	Intercompany transactions
				Account name	Amount	Trading terms	Percentage of the consolidated net revenue or total assets
1 1 2 3 3 4	Yangzhou Edison Opto Corporation Yangzhou Edison Opto Corporation Edison Opto (Dong Guan) Co., Ltd. Yangzhou Edison-Litek Opto Corporation Yangzhou Edison-Litek Opto Corporation Edison-Litek Opto Corporation Limited	Edison Opto (Dong Guan) Co., Ltd. Edison Opto (Dong Guan) Co., Ltd. The Company Edison Litek Opto Corporation Edison Litek Opto Corporation Edison Litek Opto Corporation	3 3 2 3 3 3	Sales Accounts receivable Sales Sales Accounts receivable Other receivables	20,113 15,663 223,493 161,167 24,181 30,851	90 days 90 days 90 days 90 days 90 days base on contract	1.25% 0.41% 13.91% 10.03% 0.63% 0.79%

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Note 1: (a) 0 represents The Company
(b) 1 and thereafter represent subsidiaries
Note 2: The relationships between guarantor and guarantee are as follows:
(a) 1 represents parent to subsidiary
(b) 2 represents subsidiary to parent
(c) 3 represents subsidiary to subsidiary
----- End of picture text -----

Note 3: Disclose only operating revenue and accounts receivable; related purchase, expense, and prepayment are neglected.

(b) Information on investees:

The following is the information on investees of The Company (excluding information on investees in Mainland China):

(In Thousands of Shares)

Name of investor	Name of investee	Location	Main businesses and products	Original inv	estment amount	Balanc	e as of September	30,2021	Net income (losses) of investee	Share of profits/losses of investee	Note
				September 30, 2021	December 31, 2020	Shares (thousands)	Percentage of ownership	Carrying value
The Company The Company The Company The Company The Company The Company The Company Best Opto Corporation Edison Fund Investment Corporation Edison Fund Investment Corporation	Edison Opto Corporation Ledison Opto Corporation Best Opto Corporation Edison Fund Investment Corporation Edison-Litek Opto Corporation Limited Edison-Litek Opto Corporation Edison-Egypt Opto Corporation Best Led Corporation Edison Opto USA Corporation Ledionopto Lighting Inc.	Samoa Samoa Samoa Taiwan Hong Kong Taiwan Taiwan Samoa USA Taiwan	Selling of LED components and modules Selling of LED components and modules Selling of LED components and modules Investment Investment Selling of LED components and modules Selling of LED components and modules Investment Selling of LED components and modules Selling of LED components and modules	1,041 145,991 1,550,826 686,000 167,661 48,900 25,000 1,550,826 6,392 113,185	1,041 145,991 1,550,826 655,000 167,661 48,900 47,940 1,550,826 6,392 113,185	30 4,500 50,000 25,000 5,500 9,700 2,500 50,000 220 2,200	% 100.00 % 100.00 % 100.00 % 100.00 % 44.58 % 98.43 % 100.00 % 100.00 % 55.00 % 100.00	6,253 224,537 1,151,215 76,037 109,907 183,954 20,421 1,161,388 27,309 18,279	(129) 7,855 14,169 6,543 2,011 32,899 11,649 14,169 10,224 (4,101)	(129) 7,855 14,169 6,543 897 32,708 11,649 14,169 5,623 (4,101)	- - - - - - - - - -

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Name of investor Edison Fund Investment Corporation Edison-Litek Opto Corporation Edison Fund Investment Corporation	Name of investee	Location	Main businesses and products S	Original investment amount	Original investment amount	Balance as of September 30,2021	Balance as of September 30,2021	Balance as of September 30,2021	Net income (losses) of investee	Share of profits/losses of investee	Note
				eptember 30, 2021	December 31, 2020	Shares (thousands)	Percentage of ownership	Carrying value
	Davinci Opto Corporation (Note 1) Edison-Litek Opto Corporation Limited Edison Auto Lighting Corporation	Taiwan Hong Kong Taiwan	Selling of LED components and modules Investment Selling of LED components and modules	- 33,187 7,570	5,000 33,187 5,100	- 3,463 1,000	% - % 28.06 % 100.00	- 69,179 4,519	- 2,011 (762)	- 564 (722)	- - -

Note 1: The dissolution of Company has registered in February, 2021. Note 2: The amount was eliminated in the consolidated financial statements.

(c) Information on investment in mainland China:
(i) The names of investees in Mainland China, the main businesses and products, and other information:

(In Thousands of New Taiwan Dollars)

Name of investee	Main businesses and products	Total amount of paid-in capital	Method of investment (Note 1)	Accumulated outflow of investment from Taiwan as of January 1, 2021	Investment flows	Investment flows	Accumulated outflow of investment from Taiwan as of September 30, 2021	Net income (losses) of the investee	Percentage of ownership	Investment income (losses)	Book value	Accumulated remittance of earnings in currentperiod
					Outflow	Inflow
Edison Opto Dong Guan) Co., Ltd. DongGuan Davinci Opto Co., Ltd. (note ) Yangzhou Edison Opto Corporation Yangzhou Aichuan Electronic Trade Corporation Yangzhou Edison-Litek Opto Corporation	Manufacturing and selling of LED components and modules Manufacturing and selling of LED components and modules Manufacturing and selling of LED components and modules Selling of LED components and modules Manufacturing and selling of LED components and modules	145,991 (USD 4,500 thousand) - 1,550,826 (USD 50,000 thousand) 2,148 (RMB 500 thousand) 270,552 (USD 8,875 thousand)	( b ) ( b ) ( b ) ( c ) ( b )	111,408 (USD 3,317 thousand) 52,255 (USD 1,714 thousand) 1,550,826 (USD 50,000 thousand) - 167,661 (USD 5,500 thousand)	- - - - -	- - - - -	111,408 (USD 3,317 thousand) 52,255 (USD 1,714 thousand) 1,550,826 (USD 50,000 thousand) - 167,661 (USD 5,500 thousand)	7,855 (USD 280 thousand) - 14,169 (USD 505 thousand) 30 (RMB 7 thousand) 1,794 (USD 64 thousand)	100.00% -% 100.00% 100.00% 72.64%	7,855 (USD 280 thousand) - 14,169 (USD 505 thousand) 30 (RMB 7 thousand) 1,303 (USD 46 thousand)	229,971 (USD 8,258 thousand) - 1,161,385 (USD 41,701 thousand) 2,218 (RMB 512 thousand) 156,092 (USD 5,605 thousand)	34,583 (USD 1,183 thousand) - - - -

Note 1: Investments are made through one of three ways:

(a) Direct investment from Mainland China
(b) Indirect investment from third-party country
Edison Opto (Dong Guan) Co., Ltd. is indirectly invested by the company through Ledison Opto Corporation.
Dong Guan Davinci Opto Corporation is indirectly invested by Ledion Opto Lighting Inc. through Led Plus Limited.
Yangzhou Edison Opto Corporation is indirectly invested by Best Opto Corporation and Best Led Corporation.
Yangzhou Edison-Litek Opto Corporation is indirectly invested by the Company and Edison-Litek Opto Corporation Limited.
(c) Others
Yangzhou Aichuan Trade Corporation is 100% invested by Yangzhou Edison Opto Corporation.

Note 2: The dissolution has registered in 2020.

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(ii) Limitation on investment in Mainland China:

Company Name	Accumulated Investment in Mainland China as of September 30, 2021	Investment Amounts Authorized by Investment Commission, MOEA	Upper Limit on Investment
The Company	1,829,895 (USD58,817 thousand)	1,664,595 (note 3) (USD59,770 thousand)	Note 1
Ledionopto Lighting Inc.	52,255 (note 2) (USD1,714 thousand)	52,255 (USD1,714 thousand)	-

Note 1: Since the Company acquired the permission from Industrial Development Bureau at September 9, 2019, Ministry of Economic Affairs, the upper limit on investment is not applicable, under “ Regulations Governing The Permission of Commercial Behavior in Mainland China”, Article 3 (documentation reference number: 10820423850).
Note 2: DongGuan Davinci Opto Co., Ltd., in which Ledionopto Lighting Inc. indirectly invested USD2,000 thousand, had completed the cancellation of its business registration and liquidation with the approval of Investment Commission in June 2020. The investment capital amounting to USD286 thousand had been remitted to Ledionopto. However, according to the regulation, the remittance to Mainland China amounting to USD1,714 thousand had been included in the accumulated investment amount.
Note 3: The indirect investment in Yangzhou Ledison Opto Corporation through the Company, with the amount of USD1,000 thousand, was authorized by the Investment Commission. Yangzhou Ledison had completed its liquidation in 2017 and the remitted capital amount of USD1,230 thousand had been cancelled by the Investment Commission. Therefore, the difference between the Accumulated Investment in Mainland China and Investment Amounts Authorized by Investment Commission amounting to USD230 thousand had been deducted by the Company.

(iii) Significant transactions:

The significant inter-company transactions with the subsidiary in Mainland China, which were eliminated in the preparation of consolidated financial statements, are disclosed in “ Information on significant transactions” and "Business relationships and significant intercompany transactions."

(d) Major shareholders:

Major shareholders:
Shareholding Shareholder’s Name	Shares	Percentage
Lighting Investment Corporation	16,556,182	% 12.91
Epistar Corporation	6,784,000	% 5.29

(Continued)

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(14) Segment information:

The Consolidated Company operating segment information and reconciliation are as follows:

		For the	three months en	ded September 30, 2021	ded September 30, 2021
The Company $ 220,128 35,236 $ 255,364 $ 24,485	Edison Opto (Dong Guan) Co., Ltd. 91,697 92,811	Yangzhou Edison Opto Corporation 55,375 111,733 167,108 8,494	Yangzhou Edison-Litek Opto Corporation 7,396 25,653 33,049 (6,791)	Edison-Litek Opto Corporation 66,607 1,715 68,322 4,632	Others 44,229 3,725 47,954 9,408	Reconciliation and elimination - (270,873) (270,873) (13,588)	Total 485,432 -
	184,508						485,432
	436						27,076

		For the	three months en	ded September 30, 2020	ded September 30, 2020
The Company $ 185,321 34,011 $ 219,332 $ 25,781	Edison Opto (Dong Guan) Co., Ltd. 95,224 59,088	Yangzhou Edison Opto Corporation 80,030 112,264 192,294 12,797	Yangzhou Edison-Litek Opto Corporation 15,117 30,069 45,186 (9,622)	Edison-Litek Opto Corporation 69,340 41 69,381 10,694	Others 33,400 - 33,400 (9,802)	Reconciliation and elimination - (235,473) (235,473) (7,759)	Total 478,432 -
	154,312						478,432
	3,613						25,702

		For th	e nine months en	ded September 3	0, 2021
The Company $ 619,501 118,738 $ 738,239 $ 94,903	Edison Opto (Dong Guan) Co., Ltd. 295,848 234,988 530,836 6,501	Yangzhou Edison Opto Corporation 211,911 333,823 545,734 14,171	Yangzhou Edison-Litek Opto Corporation 27,014 161,169 188,183 2,013	Edison-Litek Opto Corporation 320,838 1,808	Others 131,050 3,725 134,775 26,795	Reconciliation and elimination - (854,251) (854,251) (74,189)	Total 1,606,162 -
				322,646			1,606,162
				40,029			110,223

		For th	e nine months en	ded September 3	0, 2020
The Company $ 641,601 97,052 $ 738,653 $ 30,551	Edison Opto (Dong Guan) Co., Ltd. 254,903 139,864 394,767 23,268	Yangzhou Edison Opto Corporation 213,299 348,897 562,196 10,670	Yangzhou Edison-Litek Opto Corporation 38,837 115,005 153,842 (25,188)	Edison-Litek Opto Corporation 220,113 762	Others 90,465 - 90,465 (21,534)	Reconciliation and elimination - (701,580) (701,580) (11,273)	Total 1,459,218 -
				220,875			1,459,218
				23,592			30,086

Note: The eliminated amount among reportable segments for the three months and nine months ended September 30, 2021 and 2020 were $270,873, $235,473, $854,251 and $701,580 respectively.

AI assistant

EDISON OPTO — Interim / Quarterly Report 2021

52349_rns_2021-12-13_4791f85f-ac7a-4e38-b3c5-61d1f034747e.pdf

EDISON OPTO CORPORATION AND SUBSIDIARIES

Consolidated Financial Statements

Table of contents

KPMG

Independent Auditors’ Review Report

Introduction

Scope of Review

Basis for Qualified Conclusion

Qualified Conclusion

KPMG

Notes to Readers

EDISON OPTO CORPORATION AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the nine months ended September 30, 2021 and 2020

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

Reviewed only, not audited in accordance with generally accepted auditing standards

EDISON OPTO CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the nine months ended September 30, 2021 and 2020

Notes to the Consolidated Financial Statements

September 30, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(1) Company history

(2) Approval date and procedures of the consolidated financial statements:

(3) New standards, amendments and interpretations adopted:

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(4) Summary of significant accounting policies:

(a) Statement of compliance

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(c) Financial instruments

(i) Financial assets

(ii) Financial liabilities and equity instruments

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(d) Employee benefits

(e) Income taxes

(5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty:

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(6) Explanation of significant accounts:

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(f) Inventories

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(g) Property, plant and equipment

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(ii) Prepaid payments for land and buildings

(h) Right-of-use assets

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(k) Bonds payable

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(l) Lease liability

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(ii) Other leases

(m) Deferred income

(n) Employee benefits

(i) Defined benefit plans

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(ii) Defined contribution plans

(o) Income taxes

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(p) Capital and other equity

(i) Issuance and cancellation of ordinary shares

(ii) Capital surplus

(iii) Retained earnings

1) Earnings distribution

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(q) Share-based payment

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(i) Interest income

EDISON OPTO CORPORATION AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(iii) Other gains and losses

EDISON OPTO Interim / Quarterly Report 2021