ENNOSTAR - Interim / Quarterly Report 2021

ENNOSTAR INC. AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS’ REVIEW REPORT JUNE 30, 2021 AND 2020

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

~1~

INDEPENDENT AUDITORS’ REVIEW REPORT

PWCR21000093

To the Board of Directors and Shareholders of Ennostar Inc.

Introduction

We have reviewed the accompanying consolidated balance sheets of Ennostar Inc. and subsidiaries (the “Group”) as at June 30, 2021 and 2020, and the related consolidated statements of comprehensive income for the three-month and six-month periods then ended, as well as the consolidated statements of changes in equity and of cash flows for the six-month periods then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies. Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with “Regulations Governing the Preparation of Financial Reports by Securities Issuers” and International Accounting Standard 34, “Interim Financial Reporting” as endorsed by the Financial Supervisory Commission. Our responsibility is to express a conclusion on these consolidated financial statements based on our reviews.

Scope of review

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

~2~

Basis for qualified conclusion

As explained in Note 4(3), the financial statements of certain insignificant consolidated subsidiaries and information disclosed in Note 13 were not reviewed by independent auditors. Total assets of these subsidiaries amounted to NT$5,700,525 thousand and NT$7,705,331 thousand, constituting 7.78% and 13.23% of the consolidated total assets as at June 30, 2021 and 2020, respectively, total liabilities amounted to NT$1,616,974 thousand and NT$1,278,374 thousand, constituting 7.66% and 9.53% of the consolidated total liabilities as at June 30, 2021 and 2020 respectively, and the total comprehensive income (loss) amounted to NT$119,842 thousand, NT$318,298 thousand, NT$475,547 thousand and NT$848,646 thousand, constituting (18.48%), 25.86%, (110.77%) and 29.79% of the consolidated total comprehensive income for the three-month and six-month periods then ended, respectively. The balance of these investments accounted for under the equity method amounting to NT$1,007,524 thousand and NT$652,700 thousand, respectively, and the comprehensive (loss) income recognized from associates and joint ventures accounted for under the equity method amounting to NT$(27,126) thousand, NT$(2,959) thousand, NT$(48,703) thousand and NT$4,241 thousand were included.

Qualified conclusion

Except for the adjustments to the consolidated financial statements, if any, as might have been determined to be necessary had the financial statements of certain consolidated subsidiaries been reviewed by independent auditors as described in the basis for qualified conclusion section above, based on our reviews, nothing has come to our attention that causes us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of the Group as at June 30, 2021 and 2020, and its consolidated financial performance for the three-month and six-month periods then ended and its consolidated cash flows for the six-month periods then ended in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” and International Accounting Standard 34, “Interim Financial Reporting” as endorsed by the Financial Supervisory Commission.

~3~

Emphasis of matter

We draw attention to Note 1 to the consolidated financial statements, which describes that Ennostar Inc. used 0.5 ordinary share in exchange for 1 ordinary share of Epistar Corporation to acquire a 100% equity interest of Epistar Corporation. The aforementioned share exchange pertains to a reorganisation of entities under common control. In substance, Ennostar Inc. is the successor company of Epistar Corporation. Thus, Ennostar Inc., in its consolidated financial statements, accounted for the relevant assets and liabilities received using the book values in the financial statements of Epistar Corporation. Also, Ennostar Inc. restated the prior period consolidated financial statements as if Epistar Corporation had always been consolidated since the beginning.

Li, Tien-Yi Chou, Chien-Hung

For and on behalf of PricewaterhouseCoopers, Taiwan August 12, 2021

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

~4~

ENNOSTAR INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS JUNE 30, 2021, DECEMBER 31, 2020 AND JUNE 30, 2020

(Expressed in thousands of New Taiwan dollars) (The balance sheets as of June 30, 2021 and 2020 are reviewed, not audited)

Assets	Notes	June 30, 2021 AMOUNT % `$` `6,481,836` `9` `212,725` `-` `1,170,303` `2` `11,322,044` `15` `608,999` `1` `150,892` `-` `30,369` `-` `5,853,417` `8` `1,249,286` `2` `250,796` `-` `787,527` `1` `28,118,194` `38` `65,686` `-` `5,647,963` `8` `1,870,067` `2` `24,826,838` `34` `1,949,169` `3` `701,854` `1` `5,071,136` `7` `4,073,434` `6` `900,168` `1` `45,106,315` `62` `$` `73,224,509` `100`	December 31, 2020 AMOUNT % `$` `5,228,011` `10` `170,770` `-` `1,086,061` `2` `6,288,351` `11` `215,223` `-` `163,487` `-` `8,556` `-` `3,167,004` `6` `987,233` `2` `-` `-` `531,435` `1` `17,846,131` `32` `179,275` `-` `4,384,300` `8` `1,645,575` `3` `21,085,475` `38` `1,664,289` `3` `216,341` `-` `4,132,191` `8` `3,949,334` `7` `426,097` `1` `37,682,877` `68` `$` `55,529,008` `100`	June 30, 2020	June 30, 2020
		AMOUNT `$` `6,481,836` `212,725` `1,170,303` `11,322,044` `608,999` `150,892` `30,369` `5,853,417` `1,249,286` `250,796` `787,527` `28,118,194` `65,686` `5,647,963` `1,870,067` `24,826,838` `1,949,169` `701,854` `5,071,136` `4,073,434` `900,168` `45,106,315` `$` `73,224,509`	AMOUNT `$` `5,228,011` `170,770` `1,086,061` `6,288,351` `215,223` `163,487` `8,556` `3,167,004` `987,233` `-` `531,435` `17,846,131` `179,275` `4,384,300` `1,645,575` `21,085,475` `1,664,289` `216,341` `4,132,191` `3,949,334` `426,097` `37,682,877` `$` `55,529,008`	AMOUNT `$` `6,275,818` `152,090` `1,340,672` `5,784,129` `217,273` `190,071` `1,687` `3,340,208` `939,644` `-` `290,414` `18,532,006` `152,886` `3,484,195` `2,120,917` `20,286,497` `1,551,005` `-` `7,378,488` `4,006,308` `715,353` `39,695,649` `$` `58,227,655`	%
Current assets 1100 Cash and cash equivalents 1110 Financial assets at fair value through profit or loss - current 1150 Notes receivable, net 1170 Accounts receivable, net 1180 Accounts receivable - related parties, net 1200 Other receivables 1210 Other receivables - related parties 130X Inventories 1410 Prepayments 1460 Non-current assets held for sale - net 1470 Other current assets 11XX Current Assets Non-current assets 1510 Non-current financial assets at fair value through profit or loss 1517 Non-current financial assets at fair value through other comprehensive income 1550 Investments accounted for under equity method 1600 Property, plant and equipment 1755 Right-of-use assets 1760 Investment property, net 1780 Intangible assets 1840 Deferred income tax assets 1900 Other non-current assets 15XX Non-current assets 1XXX Total assets	6(1) 6(2) 6(4) 6(4) 7 7 6(5) 6(11) 8 6(2) 6(3) 6(6) 6(7) 6(8) 6(9) 6(31)				`11` `-` `2` `10` `-` `-` `-` `6` `2` `-` `1`
					`32`
					`-` `6` `3` `35` `3` `-` `13` `7` `1`
					`68`
					`100`

(Continued)

~5~

ENNOSTAR INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

JUNE 30, 2021, DECEMBER 31, 2020 AND JUNE 30, 2020

(Expressed in thousands of New Taiwan dollars) (The balance sheets as of June 30, 2021 and 2020 are reviewed, not audited)

					June 30, 2021				December 31, 2020	December 31, 2020			June 30, 2020
	Liabilities andEquity	Notes			AMOUNT	%			AMOUNT	%			AMOUNT	%
	Current liabilities
2100	Short-term borrowings	6(12) and 8		`$`	`2,509,978`		`4`	`$`	`1,537,574`		`3`	`$`	`1,166,276`	`2`
2110	Short-term notes and bills	6(13) and 8
	payable				`847,723`		`1`		`568,519`		`1`		`581,021`	`1`
2120	Financial liabilities at fair value
	through profit or loss - current				`1,829`		`-`		`-`		`-`		`-`	`-`
2150	Notes payable				`8,790`		`-`		`11,002`		`-`		`10,401`	`-`
2170	Accounts payable				`3,938,843`		`5`		`1,998,922`		`4`		`1,293,292`	`2`
2180	Accounts payable - related	7
	parties				`252,754`		`-`		`174,250`		`-`		`286,113`	`-`
2200	Other payables	6(14) and 7			`4,890,733`		`7`		`4,387,779`		`8`		`3,206,391`	`6`
2230	Current income tax liabilities				`44,995`		`-`		`14,004`		`-`		`2,101`	`-`
2280	Current lease liabilities				`123,395`		`-`		`113,241`		`-`		`115,703`	`-`
2320	Long-term liabilities, current	6(15) and 8
	portion				`131,684`		`-`		`137,419`		`-`		`527,820`	`1`
2399	Other current liabilities - others				`520,512`		`1`		`201,452`		`-`		`308,191`	`1`
21XX	Current Liabilities				`13,271,236`	`18`			`9,144,162`	`16`			`7,497,309`	`13`
	Non-current liabilities
2540	Long-term borrowings	6(15) and 8			`3,917,406`		`5`		`3,200,725`		`6`		`2,432,535`	`4`
2570	Deferred income tax liabilities	6(31)			`1,808,174`		`3`		`1,736,775`		`3`		`1,623,679`	`3`
2580	Non-current lease liabilities				`1,482,684`		`2`		`1,173,065`		`2`		`1,254,578`	`2`
2600	Other non-current liabilities	6(18)			`626,529`		`1`		`562,985`		`1`		`599,511`	`1`
25XX	Non-current liabilities				`7,834,793`	`11`			`6,673,550`	`12`			`5,910,303`	`10`
2XXX	Total Liabilities				`21,106,029`	`29`			`15,817,712`	`28`			`13,407,612`	`23`
	Equity attributable to owners of
	parent company
	Share capital	6(19)
3110	Share capital - common stock				`6,852,514`		`9`		`10,887,014`	`20`			`10,887,014`	`19`
	Capital surplus	6(20)
3200	Capital surplus				`42,811,524`	`59`			`36,115,456`	`65`			`36,070,166`	`62`
	Retained earnings	6(21)
3350	Unappropriated retained
	earnings (accumulated deficit)				`439,373`		`1 (`		`7,908,188) (`	`14) (`			`2,401,929) (`	`4 )`
	Other equity interest	6(22)
3400	Other equity interest				`124,976`		`- (`		`1,001,764) (`		`2) (`		`1,530,163) (`	`3 )`
3500	Treasury stocks	6(19)	`(`		`485,137 ) (`		`1) (`		`485,137) (`		`1) (`		`325,490) (`	`1 )`
31XX	Equity attributable to
	owners of the parent				`49,743,250`	`68`			`37,607,381`	`68`			`42,699,598`	`73`
36XX	Non-controlling interest				`2,375,230`		`3`		`2,103,915`		`4`		`2,120,445`	`4`
3XXX	Total equity				`52,118,480`	`71`			`39,711,296`	`72`			`44,820,043`	`77`
3X2X	Total liabilities and equity			`$`	`73,224,509`	`100`		`$`	`55,529,008`	`100`		`$`	`58,227,655`	`100`

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

~6~

ENNOSTAR INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars, except earnings (loss) per share amounts)

(The statements of comprehensive income are reviewed, not audited)

Items	Notes	Threemonths ended June 30	Threemonths ended June 30
		2021	2020
4000 Sales revenue 5000 Operating costs 5900 Operating margin 5910 Unrealized loss from sales 5920 Realized profit (loss) from sales 5950 Net operating margin Operating expenses 6100 Selling expenses 6200 General and administrative expenses 6300 Research and development expenses 6450 Expected credit profit (loss) 6000 Total operating expenses 6500 Other income and expenses - net 6900 Operating profit (loss) Non-operating income and expenses 7100 Interest income 7010 Other income 7020 Other gains and losses 7050 Finance costs 7055 Expected credit losses 7060 Share of (loss) gain of associates and joint ventures accounted for under equity method 7000 Total non-operating income and expenses 7900 Profit (loss) before income tax 7950 Income tax expense 8200 Profit (loss) for the period

(Continued)

~7~

ENNOSTAR INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars, except earnings (loss) per share amounts)

(The statements of comprehensive income are reviewed, not audited)

Items	Notes	Threemonths ended June 30	Threemonths ended June 30
		2021	2020
Other comprehensive income Components of other comprehensive income that will not be reclassified to profit or loss 8311 Loss on remeasurements of defined benefit plans 8316 Unrealised gains (loss) from investments in equity instruments measured at fair value through other comprehensive income 8320 Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will not be reclassified to profit or loss 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8310 Components of other comprehensive income that will not be reclassified to profit or loss Components of other comprehensive income that will be reclassified to profit or loss 8361 Cumulative translation differences of foreign operations 8370 Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will be reclassified to profit or loss 8399 Income tax related to components of other comprehensive income that will be reclassified to profit or loss 8360 Components of other comprehensive loss that will be reclassified to profit or loss 8300 Other comprehensive income (loss) 8500 Total comprehensive income (loss) Profit (loss) attributable to: 8610 Equity holders of the parent company 8620 Non-controlling interest Comprehensive income (loss) attributable to: 8710 Equity holders of the parent company 8720 Non-controlling interest 9750 Total basic earnings (loss) per share 9850 Total diluted earnings (loss) per share

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

~8~

ENNOSTAR INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

SIX MONTHS ENDED JUNE 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

(The statements of changes in equity are reviewed, not audited)

Notes				Equityattributable to owners of th	Equityattributable to owners of th	Equityattributable to owners of th	parent	parent				Non-controlling interest	Total equity
	Share capital - common stock	Capital surplus		Retained earnings			Otherequityinterest		Treasurystocks		Total
			Legal reserve	Special reserve	Unappropriated retained earnings(accumulated deficit)		Cumulative translation differences of foreign operations	Unrealised gains (losses) from financial assets measured at fair value through other comprehensive income
6(21) 6(22) 6(20) 6(20) 6(21) 6(22) 6(21) 6(20) 6(20)	`$` `10,887,014` `-` `-` `-` `-` `-` `-` `-` `-` `-` `-` `$` `10,887,014` `$` `10,887,014` `-` `-` `-` `1,416,020` `-` `-` `-` `(` `7,013 )` `-` `(` `5,443,507 )` `$` `6,852,514`	`$` `39,212,772` `-` `-` `-` `-` `-` `(` `3,269,622 )` `5,704` `121,312` `-` `-` `$` `36,070,166` `$` `36,115,456` `-` `-` `-` `10,308,626` `23,726` `(` `163,827 )` `(` `13,023 )` `7,013` `-` `(` `3,466,447 )` `$` `42,811,524`	`$` `161,423` `-` `-` `-` `(` `161,423` `)` `-` `-` `-` `-` `-` `-` `$` `-` `$` `-` `-` `-` `-` `-` `-` `-` `-` `-` `-` `-` `$` `-`	`$ 318,465` `-` `-` `-` `-` `(` `318,465` `)` `-` `-` `-` `-` `-` `$` `-` `$` `-` `-` `-` `-` `-` `-` `-` `-` `-` `-` `-` `$` `-`		`($` `3,749,510` `)` `(` `2,401,929` `)` `-` `(` `2,401,929` `)` `161,423` `318,465` `3,269,622` `-` `-` `-` `-` `($` `2,401,929` `)` `($` `7,908,188` `)` `440,229` `(` `856` `)` `439,373` `-` `-` `-` `-` `-` `-` `7,908,188` `$` `439,373`	`($ 785,337 )` `-` `(` `170,082 )` `(` `170,082 )` `-` `-` `-` `(` `6,364 )` `-` `-` `-` `($ 961,783 )` `($ 730,022 )` `-` `(` `158,717 )` `(` `158,717 )` `-` `-` `-` `-` `-` `-` `730,022` `($ 158,717 )`	`($` `500,148 )` `-` `(` `68,232 )` `(` `68,232 )` `-` `-` `-` `-` `-` `-` `-` `($` `568,380 )` `($` `271,742 )` `-` `283,693` `283,693` `-` `-` `-` `-` `-` `-` `271,742` `$` `283,693`		`($ 325,490 )` `-` `-` `-` `-` `-` `-` `-` `-` `-` `-` `($ 325,490 )` `($ 485,137 )` `-` `-` `-` `-` `-` `-` `-` `-` `-` `-` `($ 485,137 )`	`$` `45,219,189` `(` `2,401,929 )` `(` `238,314 )` `(` `2,640,243 )` `-` `-` `-` `(` `660 )` `121,312` `-` `-` `$` `42,699,598` `$` `37,607,381` `440,229` `124,120` `564,349` `11,724,646` `23,726` `(` `163,827 )` `(` `13,023 )` `-` `-` `(` `2 )` `$` `49,743,250`	`$ 1,976,169` `(` `172,877` `)` `(` `35,905` `)` `(` `208,782` `)` `-` `-` `-` `-` `278,688` `(` `8,400` `)` `82,770` `$ 2,120,445` `$ 2,103,915` `(` `136,554` `)` `1,519` `(` `135,035` `)` `239,900` `-` `-` `-` `-` `166,450` `-` `$ 2,375,230`	`$` `47,195,358` `(` `2,574,806 )` `(` `274,219 )` `(` `2,849,025 )` `-` `-` `-` `(` `660 )` `400,000` `(` `8,400 )` `82,770` `$` `44,820,043` `$` `39,711,296` `303,675` `125,639` `429,314` `11,964,546` `23,726` `(` `163,827 )` `(` `13,023 )` `-` `166,450` `(` `2 )` `$` `52,118,480`

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

~9~

ENNOSTAR INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

SIX MONTHS ENDED JUNE 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

(The statements of cash flows are reviewed, not audited)

CASH FLOWS FROM OPERATING ACTIVITIES
Profit (loss) before tax
Adjustments
Adjustments to reconcile profit (loss)
Depreciation

Amortization (long-term prepaid rents)

(Reversal of) expected credit losses
Net loss on financial assets at fair value through profit or loss
Interest expense

Interest income

Dividend income

Share of (gain) loss of associates and joint ventures
accounted for under the equity method

Loss on disposal of property, plant and equipment
Property, plant and equipment transferred to expenses
Gain on disposal of intangible assets

Loss (gain) on disposal of investments
Impairment loss on non-financial assets
Unrealized loss from sales
Realized loss (profit) from sales
Expenses transferred to intangible assetts
Other income from recognition of long-term deferred
revenues

Changes in operating assets and liabilities
Changes in operating assets
Financial assets at fair value through profit or loss
Notes receivable
Accounts receivable
Other receivables
Inventories
Prepayments
Other current assets
Other non-current assets
Changes in operating liabilities
Financial liabilities at fair value through profit or loss -
current
Notes payable
Accounts payable
Other payables
Other current liabilities
Other non-current liabilities
Cash (outflow) inflow generated from operations
Interest received
Dividend received
Interest paid
Income tax refunded (paid)
Net cash flows (used in) from operating activities Six months ended June 30
Notes
2021
2020
$
375,599 ( $
2,547,033 )
6(7)(29)
2,464,569
2,193,365
6(9)(29)
119,922
128,283
144,293
451,564
6(27)
57,452
178,269
6(28)
65,309
73,548
6(25)
(
23,149 ) (
29,631 )
6(26)
(
65,536 ) (
8,312 )
6(6)
77,339 (
11,344 )
4,514
19,445
11,357
343
6(27)
- (
140 )
(
247,772 )
1,433
53,409
-
(
2,459 ) (
4,777 )
(
1,589 )
4,266
(
5,560 )
-
6(18)
(
70,598 ) (
70,292 )
(
60,659 )
27,796
(
56,463 )
532,949
(
2,779,329 )
783,552
(
40,607 ) (
32,865 )
(
1,631,526 ) (
118,446 )
(
105,006 ) (
5,819 )
151,737 (
1,341 )
69,072
13,958
2,644
-
(
5 ) (
379,995 )
54,396 (
101,174 )
424,962 (
96,030 )
58,554
151,647
131,664
30,838
(
823,466 )
1,184,057
26,773
31,419
65,499
46,401
(
50,682 ) (
52,974 )
(
53,465 ) (
15,605 )
(
835,341 )
1,193,298

(Continued)

~10~

ENNOSTAR INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

SIX MONTHS ENDED JUNE 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

(The statements of cash flows are reviewed, not audited)

CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of financial assets at fair value through other
comprehensive income
Proceeds from disposal of financial assets at fair value through
other comprehensive income
Acquisition of investments accounted for under the equity
method
Proceeds from disposal of investments accounted for under the
equity method
Acquisition of property, plant and equipment

Proceeds from disposal of property, plant and equipment

Decrease in refundable deposits paid
Acquisition of intangible assets

Proceeds from disposal of intangible assets
Effect on initial consolidation of subsidiaries
Decrease (increase) in other financial assets
Cash refund from financial assets capital reduction
Net cash flows from (used in) investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in short-term loans

(Decrease) increase in short-term notes and bill payable

Proceeds from long-term loans

Repayment of long-term loans

Increase in guarantee deposits received

Repayment of principal portion of lease liabilities

Increase in cash paid for acquisition of non-controlling interests
Cash dividends distributed to non-controlling interest
Net cash flows from financing activities
Effects of foreign currency exchange
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period Six months ended June 30
Notes
2021
2020
( $
765,140 ) ( $
7,216 )
14,258
-
(
61,698 ) (
460,247 )
7,306
-
6(34)
(
2,817,307 ) (
1,622,964 )
6(34)
43,712
24,333
1,191
227
6(34)
(
26,643 ) (
28,213 )
549
140
3,763,629
-
89,141 (
9,189 )
66,930
-
315,928 (
2,103,129 )
6(35)
979,605 (
485,306 )
6(35)
(
24,818 )
247,819
6(35)
1,760,272
1,950,000
6(35)
(
1,047,786 ) (
118,203 )
6(35)
2,199
25,329
6(35)
(
65,789 ) (
52,641 )
217,695
484,589
- (
8,400 )
1,821,378
2,043,187
(
48,140 ) (
110,361 )
1,253,825
1,022,995
5,228,011
5,252,823
$
6,481,836 $
6,275,818

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

~11~

ENNOSTAR INC. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated) (Reviewed, not audited)

1. HISTORY AND ORGANIZATION

Ennostar Inc. (the “Company”) was incorporated on January 6, 2021. The Company’s share have been traded on the Taiwan Stock Exchange in the Republic of China since the date of its incorporation. The share exchange transaction, wherein the Company was established by Epistar Corporation( “Epistar”) and acquired all issued and outstanding ordinary shares of Epistar and Lextar Electronics Corporation (“ Lextar”) by way of share exchange, has been approved both at Epistar’s board meeting on June 18, 2020 and special shareholders’ meeting on August 7, 2020. The share exchange was conducted at an exchange ratio of 1 ordinary share of Epistar and Lextar for 0.5 and 0.275 ordinary share of the Company respectively. As a result, Epistar and Lextar became wholly-owned subsidiaries of the Company on January 6, 2021, and both of Epistar’s and Lextar’s ordinary shares have been delisted while the ordinary shares of the Company were listed starting from the same date under the symbol “3714”.

The Company and its subsidiaries (collectively referred herein as the “Group”) are engaged in the research and development, design, manufacturing and sales of EPI wafers and chips of A1GaInP, AlGaAs and InGaN and light-emitting diode packages and modules.

2. THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL

STATEMENTS AND PROCEDURES FOR AUTHORIZATION

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

3. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS

(1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”)

Effective date by International Accounting New Standards, Interpretations and Amendments Standards Board Amendments to IFRS 4, ‘Extension of the temporary exemption from January 1, 2021 applying IFRS 9’ Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, ‘Interest January 1, 2021 Rate Benchmark Reform— Phase 2’ Amendment to IFRS 16, ‘Covid-19-related rent concessions beyond 30 April 1, 2021(Note) June, 2021’ Note ： Earlier application from January 1, 2021 is allowed by FSC. The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment. (2) Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted by the Group

New standards, interpretations and amendments endorsed by the FSC effective from 2022 are as follows:

follows:
New Standards,Interpretations and Amendments	Effective date by International Accounting Standards Board
Amendments to IFRS 3, ‘Reference to the conceptual framework’	January 1, 2022

~12~

	Effective date by
	International Accounting
New Standards, Interpretations and Amendments	Standards Board
Amendments to IAS 16, ‘Property, plant and equipment:	January 1, 2022
proceeds before intended use’
Amendments to IAS 37, ‘Onerous contracts—	January 1, 2022
cost of fulfilling a contract’
Annual improvements to IFRS Standards 2018–2020	January 1, 2022

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

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

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

==> picture [483 x 49] intentionally omitted <==

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

Effective date by
International Accounting
New Standards, Interpretations and Amendments Standards Board
----- End of picture text -----

New standards, interpretations and amendments issued by IASB but not endorsed by the FSC are as follows: New Standards,Interpretations and Amendments	yet included in the IFRSs as Effective date by International Accounting Standards Board
Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets	To be determined by
between an investor and its associate or joint venture’	International Accounting
	Standards Board
IFRS 17, ‘Insurance contracts’	January 1, 2023
Amendments to IFRS 17, 'Insurance contracts'	January 1, 2023
Amendments to IAS 1, ‘Classification of liabilities as current or non-	January 1, 2023
current’
Amendments to IAS 1, ‘Disclosure of accounting policies’	January 1, 2023
Amendments to IAS 8, ‘Definition of accounting estimates’	January 1, 2023
Amendments to IAS 12, ‘Deferred tax related to assets and liabilities	January 1, 2023
arising from a single transaction’

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

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

(1) Compliance statement

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

(2) Basis of preparation
A. Except for the following items, these consolidated financial statements have been prepared under the historical cost convention:
- (a) Financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.
- (b) Financial assets at fair value through other comprehensive income.
- (c) Defined benefit liabilities recognized based on the net amount of pension fund assets less present value of defined benefit obligation.

~13~

B. The preparation of financial statements in compliance with IFRSs requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5.
(3) Basis of consolidation
A. Basis for preparation of consolidated financial statements:
- (a) All subsidiaries are included in the Group’s consolidated financial statements. Subsidiaries are all entities controlled by the Group. The Group controls an entity when the Group is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Consolidation of subsidiaries begins from the date the Group obtains control of the subsidiaries and ceases when the Group loses control of the subsidiaries.
- (b) Inter-company transactions, balances and unrealized gains or losses on transactions between companies within the Group are eliminated. Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency with the policies adopted by the Group.
- (c) Profit or loss and each component of other comprehensive income are attributed to the owners of the parent and to the non-controlling interests. Total comprehensive income is attributed to the owners of the parent and to the non-controlling interests even if this results in the noncontrolling interests having a deficit balance.
- (d) Changes in a parent’s ownership interest in a subsidiary that do not result in the parent losing control of the subsidiary (transactions with non-controlling interests) are accounted for as equity transactions, i.e. transactions with owners in their capacity as owners. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity.
- (e) When the Group loses control of a subsidiary, the Group remeasures any investment retained in the former subsidiary at its fair value. That fair value is regarded as the fair value on initial recognition of a financial asset or the cost on initial recognition of the associate or joint venture. Any difference between fair value and carrying amount is recognized in profit or loss. All amounts previously recognized in other comprehensive income in relation to the subsidiary are reclassified to profit or loss, on the same basis as would be required if the related assets or liabilities were disposed of. That is, when the Group loses control of a subsidiary, all gains or losses previously recognized in other comprehensive income in relation to the subsidiary should be reclassified from equity to profit or loss, if such gains or losses would be reclassified to profit or loss when the related assets or liabilities are disposed of.

~14~

B. Subsidiaries included in the consolidated financial statements:

Name of Investor	Name of Subsidiary	Main Business Activities			Ownership	June 30, 2020 - - - 100% 100% 100% 49% 100% 100% 63.94% 8.52% 64.31% - 100% 82.41% 74.86% 100%	Note
				June 30, 2021	December 31,2020
ENNOSTAR Inc. ENNOSTAR Inc. ENNOSTAR Inc. Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar corporation GaN Force Corporation Epistar JV Holding (BVI) Co., Ltd. Epistar JV Holding (B.V.I) Co., Ltd. Epistar JV Holding (BVI) Co., Ltd.	Epistar corporation Lextar Electronics Corp. Harvestar Investment Corp. Lighting Investment Corporation Epistar JV Holding (B.V.I.) Co., Ltd. Yenrich Technology Corporation SH Co.,Ltd. Full Star Enterprises Limited iReach Corporation Unikorn Semiconductor Corporation Prolight Opto Technology Corporation GaN Force Corporation Can Yang Investments Limited GV Semiconductor Inc. LiteStar JV Holding (BVI) Co., Ltd. United LED Corporation (Hong Kong) Limited Episky Hong Kong Co., Limited	Manufacturing and sales of LED wafers and chips Manufacturing and sales of LED wafers, chips, packages and modules Professional investment Professional investment Professional investment Manufacturing and sales of LED packages Manufacturing and sales of LED wafers and chips Professional investment Manufacturing, sales, packaging and module design of semiconductor light emitting devices OEM manufacturing of iii-v semiconductors Manufacturing and sales of LED packages Design, manfacturing and Professional investment Manufacturing and sales of LED wafers and chips Professional investment Professional investment Professional investment		100% 100% 100% 100% 100% 100% 49% 100% 39.09% 63.94% 8.52% 64.32% 3.53% 100% 82.41% 74.86% 100%	- - - 100% 100% 100% 49% 100% 100% 63.94% 8.52% 64.32% - 100% 82.41% 74.86% 100%		Note12 Note12 Note15 Note 10 Note 9 Note 10 Note 1 Note 9 Note 10 Note 9 Note 10 Note 3 Note 9 Note 10 Note 2 Note 9 Note 10 Note 9 Note 10 Note 9 Note 10 Note 9 Note 10 Note 9 Note 10 Note 9 Note 10 Note 9 Note 10

~15~

==> picture [484 x 41] intentionally omitted <==

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

Ownership
Name of Main Business June 30, December June 30,
Investor Name of Subsidiary Activities 2021 31, 2020 2020 Note
----- End of picture text -----

Name of Investor	Name ofSubsidiary	Main Business Activities	June 30, 2021	December 31,2020 Ownership	June 30, 2020	Note
Epistar JV Holding	HUGA Holding	Professional	100%	100%	100%	Note 9
(BVI) Co., Ltd.	(SAMOA) Limited	investment				Note 10
Epistar JV	Crystal Light	Professional	-	100%	100%	Note 9
Holding(BVI)	Enterprises Group	investment				Note 10
Co., Ltd	Limited					Note 11
Epistar JV	Can Yang Investments	Professional	80.10%	80.10%	80.10%	Note 9
Holding(BVI)	Limited	investment				Note 10
Co., Ltd
LiteStar JV	Epicrystal (Hong	Professional	100%	100%	100%	Note 9
Holding (BVI)	Kong) Co., Limited	investment				Note 10
Co., Ltd
Epicrystal (Hong	Epicrystal	Manufacturing and	93.38%	93.38%	93.38%
Kong) Co., Limited	Corporation	sales of LED wafers
	(Changzhou) Ltd.	and chips
United LED	United LED Shan	Manufacturing and	100%	100%	100%	Note 9
Corporation (Hong	Dong Corporation	sales of LED wafers				Note 10
Kong) Limited		and chips
Episky (Hong	Episky Corporation	Manufacturing and	100%	100%	100%
Kong) Limited	(Xiamen) Ltd.	sales of LED chips
Episky Corporation	Epicrystal	Manufacturing and	3.31%	3.31%	3.31%
(Xiamen) Ltd.	Corporation	sales of LED wafers
	(Changzhou) Ltd.	and chips
Episky Coporation	LEADSTAR Micro-	Developing,	15.32%	20.80%	29.10%	Note 6
(Xiamen)Ltd.	Crystal Display	manufacturing and				Note 9
	Corporation (JiangSu)	sales of LED				Note 10
	Ltd.	packages, modules
		and related
		applications.
Episky Corporation	SHENZHEN	Sales of LED chips	100%	100%	-	Note 6
(Xiamen) Ltd.	EPIKYLIN					Note 9
	OPTOELECTRONIC
	S CO.,LTD
Crystal Light	Ningbo Formosa	Sales of LED chips	-	-	100%	Note 4
Enterprise Group	Epitaxy Incorporation					Note 9
Limited						Note 10
Lighting Investment	Lighting Investment	Professional	100%	100%	100%	Note 10
Corporation	Ltd.	investment
Lighting Investment	GaNrich	Design and	100%	100%	100%	Note 5
Corporation	Semiconductor	technology service				Note 9
	Corporation	of LED lighting				Note 10
		product
Lighting	Crystaluxx SARL	Professional	-	-	100%	Note 7
Investment		investment				Note 9
Corporation						Note 10
Lighting	Yenrich Opto (Hong	Sales of LED	100%	100%	100%	Note 9
Investment	Kong) Limited	lighting products				Note 10
Corporation

~16~

==> picture [484 x 41] intentionally omitted <==

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

Ownership
Name of Main Business June 30, December June 30,
Investor Name of Subsidiary Activities 2021 31, 2020 2020 Note
----- End of picture text -----

Name of Investor	Name ofSubsidiary	Main Business Activities	June 30, 2021	December 31,2020 Ownership	June 30, 2020	Note
Lighting	Can Yang Investments	Professional	6.87%	6.87%	6.87%	Note 9
Investment	Limited	investment				Note 10
Corporation
Lighting	Prolight Opto	Manufacturing and	40.46%	40.46%	40.46%
Investment	Technology	sales of LED
Corporation	Corporation	packages
Lighting Investment	Luxlite (Hong Kong)	Professional	100%	100%	75%	Note 8
Ltd.	Corporation Limited	investment				Note 9
						Note 10
Lighting Investment	Epistar (Hong Kong)	Professional	100%	100%	100%	Note 9
Ltd.	Limited	investment				Note 10
Can Yang	Jiangsu Canyang	Manufacturing and	100%	100%	100%	Note 9
Investments Limited	Optoelectronics Ltd.	sales of LED wafers
		and chips
Luxlite (Hong	Luxlite (Shenzhen)	Sales of LED chips	100%	100%	100%
Kong) Corporation	Corporation Limited
Limited
Yenrich Technology	Prolight Opto	Manufacturing and	2.68%	3.62%	3.62%
Corporation	Technology	sales of LED
	Corporation	packages
Yenrich Technology	LEADSTAR Micro-	Developing,	21.53%	29.20%	20.90%	Note 6
Corporation	Crystal Display	manufacturing and				Note 9
	Corporation (JiangSu)	sales of LED				Note 10
	Ltd.	packages, modules
		and related
		applications.
Yenrich Technology	Amengine	Developing and	58.59%	40.80%	-	Note 1
Corporation	Corporation	sales of medical				Note 6
		optical sensor				Note9
		modules.				Note10
Prolight Opto	Prolight Opto Holding	Professional	100%	100%	100%
Technology	Corporation	investment
Corporation
Prolight Opto	Prolight Opto Holding	Professional	100%	100%	100%
Holding	Corporation	investment
Corporation
Prolight Opto	Shanghai Welight	Wholesale and	100%	100%	100%
Technology	Electronic Co., LTD	export and import of
Corporation		LED and related
		products
Lextar Electronics	Lextar (Singapore)	Professional	100%	100%	100%
Corporation	Pte. Ltd.	investment
Lextar Electronics	Liang Li Investment	Professional	100%	100%	100%	Note 9
Corporation	Co., Ltd.	investment				Note 10
Lextar Electronics	Wellypower	Professional	100%	100%	100%	Note 9
Corporation	Optronics Corp.	investment				Note 10
Lextar Electronics	Apower Optronics	Professional	100%	100%	100%	Note 9
Corporation	Corp.	investment				Note 10

~17~

==> picture [484 x 41] intentionally omitted <==

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

Ownership
Name of Main Business June 30, December June 30,
Investor Name of Subsidiary Activities 2021 31, 2020 2020 Note
----- End of picture text -----

Name of Investor	Name ofSubsidiary	Main Business Activities	June 30, 2021	December 31,2020 Ownership	June 30, 2020	Note
Lextar Electronics	Wellybond	Professional	100%	100%	100%	Note 9
Corporation	Corporation	investment				Note 10
Lextar Electronics	WELLYBOND	Professional	100%	100%	100%	Note 9
Corporation	OPTRONICS (H.K.)	investment				Note 10
	Limited
Lextar Electronics	Trendylite	Sales of products	90.50%	90.50%	90.50%	Note 9
Corporation	Corporation					Note 10
Lextar Electronics	First Vertical Laser	Design and	21.46%	22.99%	22.99%	Note 3
Corporation	Inc.	manufacturing				Note 9
		VCSEL Lei chip				Note 10
Lextar Electronics	HEXAWAVE INC.	Manufacturing and	31.69%	31.69%	31.69%	Note 9
Corporation		sales of compound				Note 10
		semiconductor
		materials and
		modules
Lextar (Singapore)	Lextar Electronics	Manufacturing and	100%	100%	100%
Pte. Ltd,	(Suzhou) Co., Ltd.	sales of LED wafers,
Wellypower		chips, packages and
Optronics Corp. and		modules
Apower Optronics
Corp.
Lextar (Singapore)	Lextar Electronics	Manufacturing and	100%	100%	100%	Note 9
Pte. Ltd.	(Xiamen) Co., Ltd.	sales of LED				Note 10
		lighting and
		modules
Lextar (Singapore)	Lextar Electronics	Sale of LED and	100%	100%	100%	Note 9
Pte. Ltd.	Korea Ltd.	after-sales service				Note 10
Liang Li Investment	First Vertical Laser	Design and	3.83%	3.83%	3.83%	Note 3
Co., Ltd.	Inc.	manufacturing				Note 9
		VCSEL Lei chip				Note 10
Wellybond	VOGITO	Design of lighting	50%	50%	50%	Note 9
Corporation	INNOVATION CO.,					Note 10
	LTD.
Wellybond	First Vertical Laser	Design and	-	29.37%	27.75%	Note 3
Corporation	Inc.	manufacturing				Note 9
		VCSEL Lei chip				Note 10
						Note 13
Wellybond	HEXAWAVE INC.	Manufacturing and	31.68%	31.68%	31.68%	Note 9
Corporation		sales of compound				Note 10
		semiconductor
		materials and
		modules
Wellybond	WellyHertz	Manufacturing and	90.91%	90.91%	-	Note 10
Corporation	Electronics Corp.	sales of switching				Note 14
		power supply
		module

~18~

Name of Investor Lextar Electronics (Suzhou) Co., Ltd.	Name ofSubsidiary Main Business Activities Lextar Electronics (Chuzhou) Corp. Manufacturing and sales of LED wafers, chips, packages and modules	June 30, 2021 December 31,2020 Ownership 100% 100%	June 30, 2020 Note 100%

Note 1: Due to the control over the entity’s financial and operational policies, this company is included in the consolidated financial statements.
Note 2: On October 1, 2018, the parent company established the Unikorn Semiconductor Corporation due to the spin-off and transfer of its operation for iii-v semiconductors OEM business. On February 20, 2019 and January 31, 2020, the Board of Directors of Unikorn Semiconductor Corporation during their meeting resolved to increase its capital in the amount of $164,000 and $400,000, respectively. The parent company did not participate in the capital increases, therefore, the parent company’s shareholding ratio was decreased to 63.94%.
Note 3: Due to changes in equity, it has not been included in the consolidated entity since June, 2021.
Note 4: The liquidation was completed on December, 2020, as the company will not continue its operation
Note 5: On January, 2020, allureLux Corporation has been renamed as GaNrich Semiconductor Corporation.
Note 6: Newly invested or established companies in 2020.
Note 7: The liquidation was completed on July, 2020, as the company will not continue its operation. Note 8: Acquiring an additional 25% of ordinary share from non-controlling interest in October 2020.
Note 9: The financial statements of the entity as of and for the six months ended June 30, 2020 were not reviewed by independent auditors as the entity did not meet the definition of significant subsidiary.
Note 10: The financial statements of the entity as of and for the six months ended June 30, 2021 were not reviewed by independent auditors as the entity did not meet the definition of significant subsidiary.
Note 11:The liquidation was completed on March, 2021, as the company will not continue its operation.
Note 12: On January 6, 2021, Epistar and Lextar became subsidiaries through a share exchange transaction with the parent company. Epistar, Lextar and their subsidiaries were consolidated in the financial statements thereafter.
Note 13: Since acquiring the new shares in August 2020, the Group’s shareholding ratio to the company changed.
Note 14: Since acquiring the new shares in November 2020, the Group obtained control over the company.
Note 15: A newly established company in June 2021. The establishment was approved by the Ministry of Economic Affairs in July 2021.
C. Subsidiaries not included in the consolidated financial statements: None.
D. Adjustments for subsidiaries with different balance sheet dates: None.
E. Significant restrictions: None.
F. Subsidiaries that have non-controlling interest that are material to the Group: None.

~19~

(4) Foreign currency translation

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

A. Foreign currency transactions and balances
(a) Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions are recognized in profit or loss in the period in which they arise.
(b) Monetary assets and liabilities denominated in foreign currencies at the period end are retranslated at the exchange rates prevailing at the balance sheet date. Exchange differences arising upon re-translation at the balance sheet date are recognized in profit or loss.
(c) Non-monetary assets and liabilities denominated in foreign currencies held at fair value through profit or loss are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in profit or loss as part of the fair value gain or loss. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through other comprehensive income are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in other comprehensive income. However, non-monetary assets and liabilities denominated in foreign currencies that are not measured at fair value are translated using the historical exchange rates at the dates of the initial transactions.
(d) Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the statement of comprehensive income within “interest income or finance costs”. All other foreign exchange gains and losses based on the nature of those transactions are presented in the statement of comprehensive income within “other gains and losses”.
B. Translation of foreign operations
(a) The operating results and financial position of all the group entities that have a functional currency different from the presentation currency are translated into the presentation currency as follows:
- i. Assets and liabilities for each balance sheet presented are translated at the closing exchange rate at the date of that balance sheet;
- ii. Income and expenses for each statement of comprehensive income are translated at average exchange rate of that period; and
- iii. All resulting exchange differences are recognized in other comprehensive income.
(b) When the foreign operation partially disposed of or sold is an associate or jointly controlled entity, exchange differences that were recorded in other comprehensive income are proportionately reclassified to profit or loss as part of the gain or loss on sale. In addition, even when the Group still retains partial interest in the former foreign associate or jointly controlled entity after losing significant influence over the former foreign associate, or losing joint control of the former jointly controlled entity, such transactions should be accounted for as disposal of all interest in these foreign operations.
(c) When the foreign operation partially disposed of or sold is a subsidiary, cumulative exchange differences that were recorded in other comprehensive income are proportionately transferred to the non-controlling interest in this foreign operation. In addition, even when the Group still retains partial interest in the former foreign subsidiary after losing control of the former foreign subsidiary, such transactions should be accounted for as disposal of all interest in the foreign operation.
(d) Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated

~20~

as assets and liabilities of the foreign entity and translated at the closing exchange rates at the balance sheet date.

(5) Classification of current and non-current items
A. Assets that meet one of the following criteria are classified as current assets; otherwise they are classified as non-current assets:
- (a) Assets arising from operating activities that are expected to be realized, or are intended to be sold or consumed within the normal operating cycle;
- (b) Assets held mainly for trading purposes;
- (c) Assets that are expected to be realized within twelve months from the balance sheet date;
- (d) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to pay off liabilities more than twelve months after the balance sheet date.
B. Liabilities that meet one of the following criteria are classified as current liabilities; otherwise they are classified as non-current liabilities:
- (a) Liabilities that are expected to be settled within the normal operating cycle;
- (b) Liabilities arising mainly from trading activities;
- (c) Liabilities that are to be settled within twelve months from the balance sheet date;
- (d) Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.
(6) Cash equivalents
Cash equivalents refer to short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Time deposits that meet the definition above and are held for the purpose of meeting short-term cash commitments in operations are classified as cash equivalents.
(7) Financial assets at fair value through profit or loss
A. Financial assets at fair value through profit or loss are financial assets that are not measured at amortised cost or fair value through other comprehensive income.
B. On a regular way purchase or sale basis, the derivative financial assets are recognised and derecognised using trade date accounting, the beneficiary certificates are recognised and derecognised using settlement date accounting.
C. At initial recognition, the Group measures the financial liabilities at fair value. All related transaction costs are recognised in profit or loss. The Group subsequently measures these financial liabilities at fair value with any gain or loss recognised in profit or loss.
D. The Group recognises the dividend income when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Group and the amount of the dividend can be measured reliably.
(8) Financial assets at fair value through other comprehensive income
A. Financial assets at fair value through other comprehensive income comprise equity securities which are not held for trading, and for which the Company has made an irrevocable election at initial recognition to recognise changes in fair value in other comprehensive income.
B. On a regular way purchase or sale basis, financial assets at fair value through other comprehensive income are recognised and derecognised using trade date accounting.
C. At initial recognition, the Group measures the financial assets at fair value plus transaction costs. The Group subsequently measures the financial assets at fair value: The changes in fair value of equity investments that were recognised in other comprehensive income are reclassified to retained earnings and are not reclassified to profit or loss following the derecognition of the investment. Dividends are recognised as revenue when the right to receive

~21~

payment is established, future economic benefits associated with the dividend will flow to the Company and the amount of the dividend can be measured reliably.

(9) Accounts and notes receivable
A. Accounts and notes receivable entitle the Group a legal right to receive consideration in exchange for transferred goods or rendered services.
B. The short-term accounts and notes receivable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.
(10) Impairment of financial assets
For financial assets at amortised at each reporting date, the Group recognises the impairment provision for 12 months expected credit losses if there has not been a significant increase in credit risk since initial recognition or recognises the impairment provision for the lifetime expected credit losses (ECLs) if such credit risk has increased since initial recognition after taking into consideration all reasonable and verifiable information that includes forecasts. On the other hand, for accounts receivable that do not contain a significant financing component, the Group recognises the impairment provision for lifetime ECLs.
(11) Derecognition of financial assets
The Group derecognizes a financial asset when one of the following conditions is met:
A. The contractual rights to receive cash flows from the financial asset expire.
B. The contractual rights to receive cash flows from the financial assets have been transferred and the Group has transferred substantially all risks and rewards of ownership of the financial assets.
C. The Group neither retains nor transfers substantially all risks and rewards of ownership of the financial asset; however, it has not retained control of the financial asset.
－
(12) Leasing arrangements (lessor) operating leases
Lease income from an operating lease (net of any incentives given to the lessee) is recognised in profit or loss on a straight-line basis over the lease term.
(13) Inventories
Inventories are stated at the lower of cost and net realizable value. Cost is determined using the weighted-average method. The cost of finished goods and work in progress comprise raw materials, direct labor, other direct costs and related production overheads (allocated based on normal operating capacity). It excludes borrowing costs the item by item approach is used in applying the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and applicable variable selling expenses.
(14) Non-current assets held for sale
Non-current assets are classified as assets held for sale when their carrying amount is to be recovered principally through a sale transaction rather than through continuing use, and a sale is considered highly probable. They are stated at the lower of carrying amount and fair value less costs to sell.
(15) Investments accounted for using the equity method - associates
A. Associates are all entities over which the Group has significant influence but no control. In general, it is presumed that the investor has significant influence, if an investor holds, directly or indirectly 20 percent or more of the voting power of the investee. Investments in associates are accounted for using the equity method and are initially recognized at cost.
B. The Group’s share of its associates’ post-acquisition profits or losses is recognized in profit or loss, and its share of post-acquisition movements in other comprehensive income is recognized in other comprehensive income. When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognize further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the associate.
C. When changes in an associate’s equity that are not recognized in profit or loss or other

~22~

comprehensive income of the associate and such changes does not affect the Group’s ownership percentage of the associate, the Group recognizes change in ownership interests in the associate in ‘capital surplus’ in proportion to its ownership.

D. Unrealized gains on transactions between the Group and its associates are eliminated to the extent of the Group’s interest in the associates. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been adjusted where necessary to ensure consistency with the policies adopted by the Group.
E. In the case that an associate issues new shares and the Group does not subscribe or acquire new shares proportionately, which results in a change in the Group’s ownership percentage of the associate but maintains significant influence on the associate, then ‘capital surplus’ and ‘investments accounted for under the equity method’ shall be adjusted for the increase or decrease of its share of equity interest. If the above condition causes a decrease in the Group’s ownership percentage of the associate, in addition to the above adjustment, the amounts previously recognized in other comprehensive income in relation to the associate are reclassified to profit or loss proportionately on the same basis as would be required if the relevant assets or liabilities were disposed of.
F. Upon loss of significant influence over an associate, the Group remeasures any investment retained in the former associate at its fair value. Any difference between fair value and carrying amount is recognized in profit or loss.
G. When the Group disposes its investment in an associate, if it loses significant influence over this associate, the amounts previously recognized in other comprehensive income in relation to the associate, are reclassified to profit or loss, on the same basis as would be required if the relevant assets or liabilities were disposed of. If it still retains significant influence over this associate, then the amounts previously recognized in other comprehensive income in relation to the associate are reclassified to profit or loss proportionately in accordance with the aforementioned approach.
H. When the Group disposes its investment in an associate, if it loses significant influence over this associate, the amounts previously recognized as capital surplus in relation to the associate are transferred to profit or loss. If it still retains significant influence over this associate, then the amounts previously recognized as capital surplus in relation to the associate are transferred to profit or loss proportionately.
(16) Property, plant and equipment
A. Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during the construction period are capitalized.
B. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognized. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.
C. Land is not depreciated. Other property, plant and equipment apply cost model and are depreciated using the straight-line method to allocate their cost over their estimated useful lives. Each part of an item of property, plant, and equipment with a cost that is significant in relation to the total cost of the item must be depreciated separately.
D. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each financial year-end. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in estimate under IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and

~23~

Errors’, from the date of the change.

The estimated useful lives of property, plant and equipment are as follows:

Buildings and structures	20 ~ 50 years
Plant and construction	2 ~ 15 years
Machinery	2 ~ 20 years
Office equipment	2 ~ 20 years
Leasehold improvements	3 ~ 15 years
Other equipment	2 ~ 20 years

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

A. Leases are recognised as a right-of-use asset and a corresponding lease liability at the date at which the leased asset is available for use by the Group. For short-term leases or leases of lowvalue assets, lease payments are recognised as an expense on a straight-line basis over the lease term.
B. Lease liabilities include the net present value of the remaining lease payments at the commencement date, discounted using the incremental borrowing interest rate. Lease payments are comprised of the following:
(a) Fixed payments, less any lease incentives receivable;
(b) Variable lease payments that depend on an index or a rate; and
(c) Payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.

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

C. At the commencement date, the right-of-use asset is stated at cost comprising the following: (a) The amount of the initial measurement of lease liability;
(b) Any lease payments made at or before the commencement date;
(c) Any initial direct costs incurred by the lessee; and
(d) An estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset, restoring the site on which it is located or restoring the underlying asset to the condition required by the terms and conditions of the lease.

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

(18) Investment property

An investment property is stated initially at its cost and measured subsequently using the cost model. Except for land, investment property is depreciated on a straight-line basis over its estimated useful life of 20 ~ 50 years.

(19) Intangible assets

A. Patents

Patents are stated at cost and amortized on a straight-line basis over their legal terms or economic service lives, whichever is shorter.

B. Technology know-how

Technology know-how is stated at cost and amortized on a straight-line basis over their economic service lives.

~24~

C. Computer software
- Computer software is stated at cost and amortized on a straight-line basis over their estimated useful lives of 2 ~ 10 years.
D. Goodwill
- Goodwill arising from a business combination is accounted for by applying the acquisition method.
E. Other intangible assets
- Other intangible assets, mainly electricity facilities, are stated at cost and amortized using the straight-line method over 3 to 5 years.
(20) Impairment of non-financial assets
A. The Group assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. Except for goodwill, when the circumstances or reasons for recognizing impairment loss for an asset in prior years no longer exist or diminish, the impairment loss is reversed. The increased carrying amount due to reversal should not be more than what the depreciated or amortized historical cost would have been if the impairment had not been recognized.
B. The recoverable amounts of goodwill and intangible assets that have not yet been available for use are evaluated periodically. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. Impairment loss of goodwill previously recognized in profit or loss shall not be reversed in the following years.
C. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash-generating units, or groups of cash-generating units, that is/are expected to benefit from the synergies of the business combination. Each unit or group of units to which the goodwill is allocated represents the lowest level within the entity at which the goodwill is monitored for internal management purposes. Goodwill is monitored at the operating segment level.
(21) Borrowings
A. Borrowings comprise of long-term and short-term bank borrowings. Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortized cost; any difference between the proceeds and the redemption value is recognized in profit or loss over the period of the borrowings using the effective interest method.
B. Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the drawn-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalized as a pre-payment for liquidity services and amortised over the period of the facility to which it relates.
(22) Notes and accounts payable
A. Accounts payable are liabilities for purchases of raw materials, goods or services and notes payable are those resulting from operating and non-operating activities.
B. The short-term notes and accounts payable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.
(23) Financial liabilities at fair value through profit or loss
A. Financial liabilities are classified in this category of held for trading if acquired principally for the purpose of repurchasing in the short-term. Derivatives are also categorised as financial liabilities held for trading unless they are designated as hedges.
B. At initial recognition, the Group measures the financial liabilities at fair value. All related transaction costs are recognised in profit or loss. The Group subsequently measures these

~25~

financial liabilities at fair value with any gain or loss recognised in profit or loss.

C. If the credit risk results in fair value changes in financial liabilities designated as at fair value through profit or loss, they are recognised in other comprehensive income in the circumstances other than avoiding accounting mismatch or recognising in profit or loss for loan commitments or financial guarantee contracts.
(24) Derecognition of financial liabilities

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

(25) Employee benefits
A. Short-term employee benefits

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

B. Pensions
(a) Defined contribution plans

For defined contribution plans, the contributions are recognized as pension expenses when they are due on an accrual basis. Prepaid contributions are recognized as an asset to the extent of a cash refund or a reduction in the future payments.

(b) Defined benefit plans
- i. Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employees will receive on retirement for their services with the Group in current period or prior periods. The liability recognized in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The defined benefit net obligation is calculated annually by independent actuaries using the projected unit credit method. The rate used to discount is determined by using interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms to maturity approximating to the terms of the related pension liability; when there is no deep market in high-quality corporate bonds, the Group uses interest rates of government bonds (at the balance sheet date) instead.
- ii. Remeasurement arising on defined benefit plans are recognized in other comprehensive income in the period in which they arise and are recorded as retained earnings.
- iii. Past service costs are recognized immediately in profit or loss.
- iv. Pension cost for the interim period is calculated on a year-to-date basis by using the pension cost rate derived from the actuarial valuation at the end of the prior financial year, adjusted for significant market fluctuations since that time and for significant curtailments, settlements, or other significant one-off events. Also, the related information is disclosed accordingly.
C. Termination benefits
Termination benefits are employee benefits provided in exchange for the termination of employment as a result from either the Group’s decision to terminate an employee’s employment before the normal retirement date, or an employee’s decision to accept an offer of redundancy benefits in exchange for the termination of employment. The Group recognises expense as it can no longer withdraw an offer of termination benefits or it recognises relating restructuring costs, whichever is earlier. Benefits that are expected to be due more than 12 months after balance sheet date shall be discounted to their present value.
D. Employees’ compensation and directors’ and supervisors’ remuneration
Employees’ compensation and directors’ and supervisors’ remuneration are recognized as expenses and liabilities, provided that such recognition is required under legal obligation or

~26~

constructive obligation and those amounts can be reliably estimated. Any difference between the resolved amounts and the subsequently actual distributed amounts is accounted for as changes in estimates.

(26) Employee share based payment
A. For the equity-settled share-based payment arrangements, the employee services received are measured at the fair value of the equity instruments granted at the grant date, and are recognized as compensation cost over the vesting period, with a corresponding adjustment to equity. The fair value of the equity instruments granted shall reflect the impact of market vesting conditions and vesting conditions. Compensation cost is subject to adjustment based on the service conditions that are expected to be satisfied and the estimates of the number of equity instruments that are expected to vest under the non-market vesting conditions at each balance sheet date. And ultimately, the amount of compensation cost recognized is based on the number of equity instruments that eventually vest.
B. Treasury stocks transferred to employees:
- (a) Restricted stocks issued to employees are measured at the fair value of the equity instruments granted at the grant date, and are recognized as compensation cost over the vesting period.
- (b) For treasury stocks where employees have to pay to acquire those stocks, if employees resign during the vesting period, they must compensate the Group for the difference between the fair value of the equity instruments and their payments on the stocks.
C. Restricted stocks:
- (a) Restricted stocks issued to employees are measured at the fair value of the equity instruments granted at the grant date, and are recognised as compensation cost over the vesting period.
- (b) For restricted stocks where those stocks do not restrict distribution of dividends to employees and employees are not required to return the dividends received if they resign during the vesting period, the Group recognises the fair value of the dividends received by the employees who are expected to resign during the vesting period as compensation cost at the date of dividends declared.
- (c) For restricted stocks where employees have to pay to acquire those stocks, if employees resign during the vesting period, they must return the stocks to the Group and the Group must refund their payments on the stocks, the Group recognises the payments from the employees who are expected to resign during the vesting period as liabilities at the grant date, and recognises the payments from the employees who are expected to be eventually vested with the stocks in ’capital surplus – others’.
(27) Income tax
A. The tax expense for the period comprises current and deferred tax. Tax is recognized in profit or loss, except to the extent that it relates to items recognized in other comprehensive income or items recognized directly in equity, in which cases the tax is recognized in other comprehensive income or equity.
B. The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions where appropriate based on the amounts expected to be paid to the tax authorities. An additional tax is levied on the unappropriated retained earnings and is recorded as income tax expense in the year when the stockholders resolve to retain the earnings.
C. Deferred income tax is recognized, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, the deferred income tax is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than

~27~

a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates, except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred income tax is determined using tax rates and laws that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

D. Deferred income tax assets are recognized only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized. At each balance sheet date, unrecognized and recognized deferred income tax assets are reassessed.
E. Current income tax assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously. Deferred income tax assets and liabilities are offset on the balance sheet when the entity has the legally enforceable right to offset current tax assets against current tax liabilities and they are levied by the same taxation authority on either the same entity or different entities that intend to settle on a net basis or realize the asset and settle the liability simultaneously.
F. The interim period income tax expense is recognised based on the estimated average annual effective income tax rate expected for the full financial year applied to the pretax income of the interim period, and the related information is disclosed accordingly.
G. If a change in tax rate is enacted or substantively enacted in an interim period, the Group recognises the effect of the change immediately in the interim period in which the change occurs. The effect of the change on items recognised outside profit or loss is recognised in other comprehensive income or equity while the effect of the change on items recognised in profit or loss is recognised in profit or loss.
(28) Share capital
A. Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or stock options are shown in equity as a deduction, net of tax, from the proceeds.
B. Where the Company repurchases the Company’s equity share capital that has been issued, the consideration paid, including any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the Company’s equity holders. Where such shares are subsequently reissued, the difference between their book value and any consideration received, net of any directly attributable incremental transaction costs and the related income tax effects, is included in equity attributable to the Company’s equity holders.
(29) Dividends

Dividends are recorded in the Company’s financial statements in the period in which they are resolved by the Company’s shareholders. Cash dividends are recorded as liabilities.

(30) Revenue recognition
A. Sales of goods:
- (a) The Group is engaged in the research, development and sale of EPI wafers and chips of AlGaInP, AlGaAs and InGaN and light-emitting diode packages and modules. Sales are recognised when control of the products has transferred, being when the products are delivered to the customer, the wholesaler has full discretion over the channel and price to sell the products, and there is no unfulfilled obligation that could affect the customer’s acceptance of the products. Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the wholesaler, and either the customer has accepted the products in accordance with the sales contract, or the Group has objective evidence that all criteria for acceptance have been satisfied.
- (b) Sales revenue is recognised on the net amount of contract price after deduction of sales

~28~

discounts and allowances. The sales discounts and allowances were offered to customers based on aggregate sales over a 12-month period. Accumulated experience is used to estimate and provide for the sales discounts and allowances, using the expected value method, and revenue is only recognised to the extent that it is highly probable that a significant reversal will not occur. The estimation is subject to an assessment at each reporting date. A refund liability is recognised for expected sales discounts and allowances payable to customers in relation to sales made until the end of the reporting period. No element of financing is deemed present as the sales are made with a credit term less than 1 year, which is consistent with market practice.

  - (c) The Group’s obligation to provide a refund for faulty products under the standard warranty terms is recognised as a provision.

  - (d) A receivable is recognised when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

B. Revenue from licencing intellectual property
- (a) The Group entered into a contract with a customer to grant a licence of patents and intellectual property to the customer. Given the licence is distinct from other promised goods or services in the contract, the Group recognises the revenue from licencing when the licence transfer to a customer either at a point in time or over time based on the nature of the licence granted. The nature of the Group’s promise in granting a licence is a promise to provide a right to access the Group’s intellectual property if the Group undertakes activities that significantly affect the patents and intellectual property to which the customer has rights, the customer is affected by the Group’s activities and those activities do not result in the transfer of a good or a service to the customer as they occur. The royalties are recognised as revenue on a straight-line basis throughout the licencing period. In case the abovementioned conditions are not met, the nature of the Group’s promise in granting a licence is a promise to provide a right to use the Group’s intellectual property and therefore the revenue is recognised when transferring the licence to a customer at a point in time.
- (b) Some contracts require a sales-based royalty in exchange for a licence of intellectual property. The Group recognises revenue when the performance obligation has been satisfied and the subsequent sale occurs.
C. Incremental costs of obtaining a contract
- Given that the contractual period lasts less than one year, the Group recognises the incremental costs of obtaining a contract as an expense when incurred although the Group expects to recover those costs.
(31) Government grants

Government grants are recognized at their fair value only when there is reasonable assurance that the Group will comply with any conditions attached to the grants and the grants will be received. Government grants are recognized in profit or loss on a systematic basis over the periods in which the Group recognizes expenses for the related costs for which the grants are intended to compensate. Government grants related to property, plant and equipment are recognized as non-current liabilities and are amortized to profit or loss over the estimated useful lives of the related assets using the straight-line method.

(32) Business combinations
A. The Group uses the acquisition method to account for business combinations. The consideration transferred for an acquisition is measured as the fair value of the assets transferred, liabilities incurred or assumed and equity instruments issued at the acquisition date, plus the fair value of any assets and liabilities resulting from a contingent consideration arrangement. All acquisitionrelated costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent

~29~

liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. For each business combination, the Group measures at the acquisition date components of non-controlling interests in the acquiree that are present ownership interests and entitle their holders to the proportionate share of the entity’s net assets in the event of liquidation at either fair value or the present ownership instruments’ proportionate share in the recognised amounts of the acquiree’s identifiable net assets. All other non-controlling interests should be measured at the acquisition-date fair value.

  - B. The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the fair value of any previous equity interest in the acquiree over the fair value of the identifiable assets acquired and the liabilities assumed is recorded as goodwill at the acquisition date. If the total of consideration transferred, non-controlling interest in the acquiree recognised and the fair value of previously held equity interest in the acquiree is less than the fair value of the identifiable assets acquired and the liabilities assumed, the difference is recognised directly in profit or loss on the acquisition date.

(33) Operating segments
- Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision-Maker. The Chief Operating Decision-Maker is responsible for allocating resources and assessing performance of the operating segments.
CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF ASSUMPTION UNCERTAINTY

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

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

None.

(2) Critical accounting estimates and assumptions

A. Impairment valuation of goodwill, property, plant and equipment
In assessing assets impairment valuation, the Group estimates useful lives of assets and possible income and expenses in the future based on the Group’s subjective judgement, any changes in economic condition and strategy of the Group will affect the recoverable amount, please refer to Note 6(10).

As of June 30, 2021, the Group recognised impaired property, plant and equipment of $24,826,838 and goodwill of $3,854,266.

B. Evaluation of inventories

As inventories are stated at the lower of cost and net realizable value, the Group must determine the net realizable value of inventories on balance sheet date using judgements and estimates. Due to the rapid technology innovation, the Group evaluates the amounts of obsolete inventories or inventories without market selling value on balance sheet date, and writes down the cost of inventories to the net realizable value. Such an evaluation of inventories is principally based on the demand for the products within the specified period in the future. Therefore, there might be material changes to the evaluation.

As of June 30, 2021, the carrying amount of inventories was $5,853,417.

~30~

6. DETAILS OF SIGNIFICANT ACCOUNTS

(1) Cash and cash equivalents

TAILS OF SIGNIFICANT ACCOUNTS Cash and cash equivalents
Cash on hand and petty cash Checking accounts and demand deposits Time deposits Bonds sold under repurchase agreement	June 30,2021 1,479 $ 2,954,804 2,329,821 1,195,732 6,481,836 $	December 31,2020 1,171 $ 2,210,413 1,326,081 1,690,346 5,228,011 $	June 30,2020
			1,059 $ 2,531,823 2,261,660 1,481,276
			6,275,818 $

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

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

==> picture [498 x 264] intentionally omitted <==

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

Items June 30, 2021 December 31, 2020 June 30, 2020
Current items:
Financial assets mandatorily measured
at fair value through profit or loss
Beneficiary certificates $ 84,151 $ 40,150 $ 79,750
Listed stocks 193,439 427,775 427,775
Derivatives 7,287 - -
284,877 467,925 507,525
Valuation adjustment ( 72,152) ( 297,155) ( 355,435)
212,725 170,770 152,090
Non-current items:
Financial assets mandatorily measured
at fair value through profit or loss
Unlisted stocks 275,248 342,178 342,178
Valuation adjustments ( 209,562) ( 162,903) ( 189,292)
65,686 179,275 152,886
$ 278,411 $ 350,045 $ 304,976
----- End of picture text -----

A. The Group entered into contracts relating to derivative financial assets which were not accounted for under hedge accounting. The information is listed below:

June 30, 2021

Notional principal (in Financial instruments thousands) Currency Maturity date Forward foreign exchange contract - sell USD 22,500 USD to NTD 2021.07.12~2021.10.12 Forward foreign exchange contract - sell USD 120 USD to JPY 2021.07.23~2021.08.24 Forward foreign exchange contract - sell USD 17,000 USD to RMB 2021.07.26~2021.10.26 Forward foreign exchange contract - buy JPY 57,333 JPY to RMB 2021.07.26~2021.08.26

December 31,2020 and June 30,2020: None.

The Group entered into forward foreign exchange contracts to hedge exchange rate risk of export and import proceeds. However, these forward foreign exchange contracts are not accounted for under hedge accounting.

B. The net loss (gain) recognized by the Company amounted to ($23,214), $167,636, ($57,452) and ($178,269) for the three months and the six months ended June 30,2021 and 2020.

~31~

C. Information on credit risk of financial assets at fair value through profit or loss is provided in Notes 12(2) and (3).

(3) Financial assets at fair value through other comprehensive income

Items		June 30, 2021	December 31, 2020	December 31, 2020	June	30, 2020
Non-current items:
Equity instruments
Listed stocks	$	1,597,966	$	724,909	$	724,909
Unlisted stocks		4,069,018		3,933,096		3,702,420
		5,666,984		4,658,005		4,427,329
Valuation adjustment	(	19,021)	(	273,705)	(	943,134)
	$	5,647,963	$	4,384,300	$	3,484,195

A. The Group has elected to classify investments that are considered to be strategic investments as financial assets at fair value through other comprehensive income. The fair value of such investments amounted to $5,647,963, $4,384,300 and $3,484,195 as at June 30, 2021, December 31, 2020 and June 30, 2020, respectively.

31, 2020 and June 30, 2020, respectively.	31, 2020 and June 30, 2020, respectively.	31, 2020 and June 30, 2020, respectively.
B. Amounts recognized in profit or loss and other comprehensive income			in	relation to the financial
assets at fair value through other comprehensive income are listed below:
Equity instruments at fair value through other	Three months ended			Three months ended
comprehensive income		June 30,2021			June 30,2020
Fair value change recognised in other	$	151,243	($		261,280)
comprehensive income
Dividend income recognized in profit or loss Held at end of period	$	27,290		$	168
Equity instruments at fair value through other		Six months ended			Six months ended
comprehensive income		June 30,2021			June 30,2020
Fair value change recognised in other	$	301,895	($		154,797)
comprehensive income
Dividend income recognized in profit or loss Held at end of period	$	65,536		$	8,312

C. Information relating to credit risk of financial assets at fair value through other comprehensive income is provided in Notes 12(2) and (3).

(4) Notes and accounts receivable

Notes and accounts receivable
		June 30,2021	December 31,2020		June 30, 2020
Notes receivable	$	2,041,897	$	1,926,257	$	1,750,619
Less: Allowance for uncollectible accounts	(	871,594)	(	840,196)	(	409,947)
	$	1,170,303	$	1,086,061	$	1,340,672
Accounts receivable	$	11,362,884	$	6,306,903	$	5,826,174
Less: Allowance for uncollectible accounts	(	40,840)	(	18,552)	(	42,045)
	$	11,322,044	$	6,288,351	$	5,784,129

A. The ageing analysis of accounts receivable and notes receivable is as follows:

~32~

==> picture [469 x 250] intentionally omitted <==

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

June 30, 2021 December 31, 2020
Accounts receivable Notes receivable Accounts receivable Notes receivable
Not past due $ 10,701,876 $ 1,157,626 $ 5,790,012 $ 1,089,903
Up to 30 days 443,039 282 307,622 13,448
-
31 to 90 days 133,998 101,702 70,065
91 to 180 days 69,584 47,634 106,124 752,841
Over 180 days 14,387 836,355 1,443 -
$ 11,362,884 $ 2,041,897 $ 6,306,903 $ 1,926,257
June 30, 2020
Accounts receivable Notes receivable
Not past due $ 4,996,321 $ 1,750,619
-
Up to 30 days 297,066
-
31 to 90 days 303,635
-
91 to 180 days 181,663
-
Over 180 days 47,489
$ 5,826,174 $ 1,750,619
----- End of picture text -----

The above ageing analysis was based on past due date.

B. As of June 30, 2021, December 31, 2020 and June 30, 2020, the Group had outstanding discounted notes receivable amounting to $435,781, $410,310 and $746,150, respectively. The Group has no payment obligations when the drawers of the notes refuse to pay for the notes at maturity. Those discounted notes receivable were presented as a deduction item to notes receivable. Those discounted notes receivable were deducted from notes receivable directly.
C. Details of the Group’s notes receivable pledged to others as collateral are provided in Note 8.
D. The Group holds collateral including commercial papers, financial assets, patents as well as machinery and equipment as security for accounts receivable.
E. As at June 30,2021, December 31,2020 and June 30,2020, without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the notes receivable held by the Group was $1,170,303, $1,086,061 and $1,340,672; the maximum exposure to credit risk in respect of the amount that best represents the accounts receivable held by the Group was $11,322,044, $6,288,351 and $5,784,129, respectively.
F. Information on credit risk of accounts receivable and notes receivable is provided in Note 12(2).
(5) Inventories

Inventories
Raw materials Work in progress Finished goods		June 30,2021
	Allowance for Cost valuation loss 1,714,094 $ 94,314) ($ 2,727,357 350,126) ( 2,145,089 288,683) ( 6,586,540 $ 733,123) ($		Book value
			1,619,780 $ 2,377,231 1,856,406
			5,853,417 $

~33~

Raw materials Work in progress Finished goods Raw materials Work in progress Finished goods	Allowance for Cost valuation loss 846,389 $ 68,147) ($ 1,523,436 491,771) ( 1,819,253 462,156) ( 4,189,078 $ 1,022,074) ($ December 31,2020 Allowance for Cost valuation loss 955,396 $ 67,275) ($ 1,307,217 319,834) ( 1,828,437 363,733) ( 4,091,050 $ 750,842) ($ June 30,2020	Book value
		778,242 $ 1,031,665 1,357,097 3,167,004 $
		Book value
		888,121 $ 987,383 1,464,704
		3,340,208 $

The cost of inventories recognised as expense for the three months and the six months ended June 30,2021 and 2020:

30,2021 and 2020:
		Three months ended			Three months ended
			June 30,2021			June 30, 2020
Cost of goods sold	$		7,593,049	$		2,859,750
Scrap loss			7,231			9,548
Recovery benefits in market value	(		515,142)	(		67,744)
Loss on idle capacity			171,355			650,426
Other	(		20,368)	(		55,997)
	$		7,236,125	$		3,395,983
			Six months ended			Six months ended
			June 30,2021			June 30,2020
Cost of goods sold	$		13,218,083	$		5,885,952
Scrap loss			60,701			19,155
Recovery benefits in market value	(		406,994)	(		35,502)
Loss on idle capacity			327,568			964,517
Other	(		21,782)	(		48,242)
	$		13,177,576	$		6,785,880

Due to the increase in the utilization rate of the Group, the net realizable value of inventories has rebounded, which is recognized as a decrease in the cost of goods sold.

~34~

(6) Investments accounted for using the equity method

Associates: Nan Ya Photonics Incorporation Tekcore Co., Ltd. TE Opto Corporation Country Lighting (BVI) Co., Ltd. LEDOLUX Sp. Zo.O. Interelight Optotech (Hong Kong) Ltd. ES-LEDRU LLC LEDAZ Co., Ltd. Changzhou Chemsemi Co., Ltd (NOTE) GCS Holdings, Inc. JOINT POWER EXPONENT, LTD. Chuzhou Bwin Technology Corp. Aurora International Lighting Corporation Limited First Vertical Laser Inc. iReach Corporation Domi-Star Optoelectronics Corporation	June 30,2021 - $ - 43,949 85,194 12,580 11,687 - 44,204 412,994 862,544 35,516 110,974 182,143 40,545 27,320 417 1,870,067 $	December 31,2020 - $ 26,926 43,804 87,097 13,077 11,886 - 71,668 471,471 919,646 - - - - - - 1,645,575 $	June 30,2020
			530,383 $ 25,868 48,674 90,652 12,975 12,131 1,951 57,509 439,122 901,652 - - - - - -
			2,120,917 $

Note: In August 2020, Changzhou NEO-EPISKY Co., Ltd. has been renamed as Changzhou Chemsemi Co., Ltd.

A. The carrying amount of the Group’s interests in all individually immaterial associates and the Group’s share of the operating results are summarised below:

As of June 30,2021, December 31,2020 and June 30,2020, the carrying amount of the Group’s individually immaterial associates amounted to $1,870,067, $1,645,575 and $2,120,917, respectively.

~35~

			Three months ended	Three months ended	Three months ended	Three months ended
				June 30,2021		June 30,2020
Profit (loss) for the period from			($	51,912)	$	1,344
continuing operations
Other comprehensive income				933		97,583
Total comprehensive (loss) income			($	50,979)	$	98,927

			Six months ended		Six months ended
				June 30, 2021		June 30, 2020
Profit (loss) for the period from			($	77,339)	$	11,344
continuing operations
Other comprehensive income				-		61,466
Total comprehensive (loss) income			($	77,339)	$	72,810
The fair value of the Group’s	material associates		with	quoted market prices	is	as follows:
		June 30,2021	December 31,2020			June 30, 2020
Tekcore Co. Ltd.	$	-	$	136,217	$	58,314
GCS Holdings, Inc.		811,177		903,548		878,858
	$	811,177	$	1,039,765	$	937,172

B. The fair value of the Group’s material associates with quoted market prices is as follows:
C. On June 5, 2020, the Group obtained significant influence over GCS Holdings, Inc. as the Group owned two board seats through the re-election of the regular shareholders’ meeting. Therefore, the Group reclassified it from financial asset at fair value through profit and loss into investment in associate and recognised gain on disposal of investment amounting to $31,414 in accordance with IFRSs.
D. On September 2, 2020, the Group disposed some of its share of NanYa Photonics Incorporation and lost significant influence as its shares owned by the Group were less than 20%. Therefore, the Group reclassified it into financial asset at fair value through other comprehensive income and recognised gain on disposal of investment amounting to $38,546 in accordance with IFRSs.
E. In the second quarter of 2021, the Group disposed part of its share of First Vertical Laser Inc. and iReach Corporation and lost control over the entities. Therefore, the Group reclassified it into investments accounted for using the equity method and recognised gain on disposal of investment amounting to $57,527 in accordance with IFRSs.

~36~

(7) Property, plant and equipment

																	Construction	Construction
																in progress and
				Buildings and						Office			Leasehold				equipment to
		Land			structures		Machinery		equipment			improvements			Others			be inspected		Total
At January 1, 2021
Cost	$	511,997	$		15,382,224	$	41,914,660	$		415,371	$		175,629	$	620,231	$		3,716,424	$	62,736,536
Accumulated
depreciation and
impairment		-	(		8,580,667)	(	32,186,143)	(		315,015)	(		90,976)	(	478,260)			-	(	41,651,061)
	$	511,997	$		6,801,557	$	9,728,517	$		100,356	$		84,653	$	141,971	$		3,716,424	$	21,085,475
2021
Opening net book	$	511,997	$		6,801,557	$	9,728,517	$		100,356	$		84,653	$	141,971	$		3,716,424	$	21,085,475
amount at January 1
Additions		-			3,498		322,461			1,873			-		15,403			1,683,165		2,026,400
Transfer		-			651,624		3,800,504			34,238			6,279		39,803	(		4,532,448)		-
Acquired from		1,170,859			1,732,781		1,201,735			9,941			1,513		392,619			205,059		4,714,507
business combinations
Disposals		-	(		4,198)	(	49,250)	(		12)			-	(	1)			-	(	53,461)
Reclassified to non-	(	124,661)	(		124,885)	(	541)	(		709)			-		-			-	(	250,796)
current assets held for
sale
Reclassifications		-	(		1,427)		81,233	(		11)			-		176	(		4,791)		75,180
Reclassified to		-	(		36,263)		-			-			-		-			-	(	36,263)
investment property
Depreciation charge		-	(		451,417)	(	1,797,557)	(		32,030)	(		9,405)	(	84,823)			-	(	2,375,232)
Impairment loss		-	(		26,488)	(	26,921)			-			-		-			-	(	53,409)
Disposals of
Subsidiary		-	(		4,929)	(	98,778)	(		673)	(		8,849)	(	24,647)	(		758)	(	138,634)
Net exchange
differences		-	(		5,926)	(	147,941)	(		953)	(		306)	(	3,047)	(		8,756)	(	166,929)
Closing net book
amount at June 30	$	1,558,195	$		8,533,927	$	13,013,462	$		112,020	$		73,885	$	477,454	$		1,057,895	$	24,826,838
At June 30, 2021
Cost	$	1,558,195	$		17,327,236	$	54,949,488	$		501,987	$		343,624	$	3,154,756	$		1,057,895	$	78,893,181
Accumulated
depreciation and
impairment		-	(		8,793,309)	(	41,936,026)	(		389,967)	(		269,739)	(	2,677,302)			-	(	54,066,343)
	$	1,558,195	$		8,533,927	$	13,013,462	$		112,020	$		73,885	$	477,454	$		1,057,895	$	24,826,838

~37~

																	Construction	Construction
																in progress and
				Buildings and						Office			Leasehold				equipment to
		Land			structures		Machinery		equipment			improvements			Others			be inspected		Total
At January 1, 2020
Cost	$	650,521	$		16,213,192	$	41,452,304	$		402,533	$		161,373	$	591,882	$		1,332,534	$	60,804,339
Accumulated
depreciation and
impairment		-	(		8,510,028)	(	30,883,443)	(		272,598)	(		122,853)	(	438,311)			-	(	40,227,233)
	$	650,521	$		7,703,164	$	10,568,861	$		129,935	$		38,520	$	153,571	$		1,332,534	$	20,577,106
2020
Opening net book	$	650,521	$		7,703,164	$	10,568,861	$		129,935	$		38,520	$	153,571	$		1,332,534	$	20,577,106
amount at January 1
Additions		-			304		15,638			424			9,445		1,593			2,008,030		2,035,434
Transfer		-			142,614		407,158			4,767			10,553		7,033	(		572,125)		-
Disposals		-	(		24,703)	(	18,204)	(		13)	(		559)	(	216)			-	(	43,695)
Reclassifications		-	(		881)	(	1,642)			151			-		-	(		596)	(	2,968)
Depreciation charge		-	(		440,000)	(	1,642,107)	(		28,163)	(		6,990)	(	27,732)			-	(	2,144,992)
Net exchange
differences		-	(		38,902)	(	79,196)	(		2,001)	(		555)	(	2,414)	(		11,320)	(	134,388)
Closing net book
amount at June 30	$	650,521	$		7,341,596	$	9,250,508	$		105,100	$		50,414	$	131,835	$		2,756,523	$	20,286,497
At June 30, 2020
Cost	$	650,521	$		16,021,633	$	39,719,920	$		391,193	$		132,959	$	586,209	$		2,756,523	$	60,258,958
Accumulated
depreciation and
impairment		-	(		8,680,037)	(	30,469,412)	(		286,093)	(		82,545)	(	454,374)			-	(	39,972,461)
	$	650,521	$		7,341,596	$	9,250,508	$		105,100	$		50,414	$	131,835	$		2,756,523	$	20,286,497

Information about the property, plant and equipment that were pledged to others as collaterals is provided in Note 8.

－
(8) Leasing arrangements lessee
A. The Group leases various assets including land, buildings, machinery, transportation equipment and office equipment. Rental contracts are typically made for periods of 2 to 50 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose covenants, but leased assets may not be used as security for borrowing purposes.
B. Short-term leases with a lease term of 12 months or less comprise of buildings, transportation equipment and office equipment. Low-value assets comprise of office equipment.
C. The carrying amount of right-of-use assets and the depreciation charge are as follows:

Land Land use right Buildings Machinery Transportation equipment Office equipment		June 30,2021 Carryingamount $ 1,271,924 224,568 198,101 202,358 6,968 45,250 1,949,169 $	December 31,2020 Carryingamount $ 1,097,002 231,140 50,902 230,394 12,517 42,334 1,664,289 $	June 30,2020
				Carryingamount
				$ 1,192,029 224,438 59,395 39,962 10,600 24,581
				1,551,005 $

~38~

Land Buildings Machinery Transportation equipment Office equipment Land Buildings Machinery Transportation equipment Office equipment	Three months ended June 30,2021 Depreciation charge $ 13,911 9,236 14,584 1,221 3,750 42,702 $ Six months ended June 30, 2021 Depreciation charge $ 27,854 21,824 29,446 2,928 7,285 89,337 $	Three months ended June 30,2020
		Depreciation charge
		$ 12,177 5,177 2,296 2,149 2,779 24,578 $ Six months ended June 30,2020
		Depreciation charge
		$ 24,720 9,848 4,633 3,822 5,350
		48,373 $

D. For the three months and the six months ended June 30, 2021 and 2020, the additions to right-ofuse assets were $5,950, $2,890, $32,707 and $41,587, respectively.
E. The information on profit and loss accounts relating to lease contracts is as follows:

Items affecting profit or loss Interest expense on lease liabilities Expense on short-term lease contracts Expense on leases of low-value assets Items affecting profit or loss Interest expense on lease liabilities Expense on short-term lease contracts Expense on leases of low-value assets	Three months ended June 30, 2021 $ 7,233 17,516 1,172 Six months ended June 30,2021 $ 14,444 31,061 2,141	Three months ended June 30,2020
		$ 6,722 3,197 928 Six months ended June 30,2020
		$ 13,461 6,616 1,799

F. For the three months and the six months ended June 30, 2021 and 2020, the Group’s total cash outflow for leases were $48,574, $14,284, $107,348 and $61,563, respectively.

~39~

(9) Intangible assets

Intangible assets
			Patents			Goodwill			Software			Others			Total
At January 1, 2021
Cost		$	2,416,238		$	6,324,659		$	454,064		$	112,073		$	9,307,034
Accumulated amortisation and
impairment	(		1,544,653)	(		3,182,323)	(		353,042)	(		94,825)	(		5,174,843)
	$		871,585	$		3,142,336	$		101,022	$		17,248	$		4,132,191
2021							.
Opening net book amount
as at January 1		$	871,585		$	3,142,336		$	101,022		$	17,248		$	4,132,191
Additions`－`acquired separately			280			-			1,892			-			2,172
Additions`－`acquired through
business combinations			353,123			711,930			-			74,294			1,139,347
Reclassifications	(		32,101)			-			2,660			-	(		29,441)
Amortisation charge	(		78,782)			-	(		29,238)	(		11,902)	(		119,922)
Disposals of subsidiary			-			-	(		203)	(		49,992)	(		50,195)
Net exchange differences	(		2,697)			-	(		319)			-	(		3,016)
Closing net book amount
as at June 30	$		1,111,408	$		3,854,266	$		75,814	$		29,648	$		5,071,136
At June 30, 2021
Cost		$	2,798,112		$	7,045,358		$	456,929		$	136,374		$	10,436,773
Accumulated amortisation and
impairment	(		1,686,704)	(		3,191,092)	(		381,115)	(		106,726)	(		5,365,637)
	$		1,111,408	$		3,854,266	$		75,814	$		29,648	$		5,071,136
			Patents			Goodwill			Software			Others			Total
At January 1, 2020
Cost		$	2,406,242		$	6,324,659		$	422,203		$	99,476		$	9,252,580
Accumulated amortisation and
impairment	(		1,372,947)			-	(		286,367)	(		91,468)	(		1,750,782)
	$		1,033,295	$		6,324,659	$		135,836	$		8,008	$		7,501,798
2020
Opening net book amount
as at January 1		$	1,033,295		$	6,324,659		$	135,836		$	8,008		$	7,501,798
Additions`－`acquired separately			728			-			3,373			-			4,101
Reclassifications			4,100			-			-			-			4,100
Amortisation charge	(		92,046)			-	(		34,561)	(		1,676)	(		128,283)
Net exchange differences	(		2,531)			-	(		697)			-	(		3,228)
Closing net book amount
as at June 30	$		943,546	$		6,324,659	$		103,951	$		6,332	$		7,378,488
At June 30, 2020
Cost		$	2,411,455		$	6,324,659		$	422,870		$	99,476		$	9,258,460
Accumulated amortisation and
impairment	(		1,467,909)			-	(		318,919)	(		93,144)	(		1,879,972)
	$		943,546	$		6,324,659	$		103,951	$		6,332	$		7,378,488

~40~

Details of amortisation on intangible assets are as follows:

Operating costs Selling expenses Administrative expenses Research and development expenses Operating costs Selling expenses Administrative expenses Research and development expenses	Three months ended June 30,2021 29,402 $ 265 13,222 14,516 57,405 $ Six months ended June 30,2021 61,474 $ 547 28,506 29,395 119,922 $	Three months ended June 30,2020 29,773 $ 467 14,074 17,876 62,190 $ Six months ended June 30,2020 59,979 $ 937 30,822 36,545
		128,283 $

(10) Impairment of non-financial assets

A. The Group assessed that production line adjustments and configurations resulted in idling or impairment of certain property, plant and equipment. The Group wrote down the carrying amount of the assets based on the recoverable amount and recognised impairment losses of $53,409, $0, $53,409 and $0 for the three months and the six months ended June 30, 2021 and 2020, respectively. The recoverable amount is the assets’ fair value less costs of disposal. The fair value is classified as a level 3 fair value. Details of impairment are as follows:

Impairment loss`－`buildings and structure Impairment loss`－`machinery Impairment loss`－`buildings and structure Impairment loss`－`machinery		Three months ended June 30, 2021		Three months ended June 30,2020
		26,488 $ 26,921 53,409 $ Six months ended June 30,2021		- $ - - $ Six months ended June 30,2020
		26,488 $ 26,921 53,409 $		- $ - - $

B.Goodwill is allocated to the Group’s cash-generating units identified according to operating segment. The recoverable amount of all cash-generating units has been determined based on value-in-use calculations. These calculations use pre-tax cash flow projections based on financial budgets approved by the management covering a five-year period. Cash flows beyond the fiveyear period are extrapolated using the estimated growth rates stated below.

The recoverable amount of all cash-generating units calculated using the value-in-use was less than their carrying amount, therefore an impairment loss of $3,191,092 was recognized for the

~41~

goodwill. The key assumptions used for value-in-use calculations are as follows:

(a) Revenue growth rate: Estimation refers to relevant market information and relevant operating and sales plan.

(b) Gross margin rate: Estimation refers to historical data and relevant operating and sales plan.

(c) Discount rate: The rate before tax and reflecting specific risk of relevant operating segment. The discount rate for 2020 was 10.50%

(11) Non-current assets held for sale

Property, plant and equipment

==> picture [303 x 27] intentionally omitted <==

The Group planned to sell the land and plant of the Longtan plant in Taoyuan, and thus transferred it to disposal group held for sale. The sales and purchase agreement was signed in May 2021. The completion date for the transaction is expected by the third quarter of 2021.

(12) Short-term borrowings

==> picture [472 x 94] intentionally omitted <==

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

June 30, 2021 December 31, 2020 June 30, 2020
Bank borrowings
Unsecurred borrowings $ 2,509,978 $ 1,537,574 $ 1,166,276
Interest rate range-NTD 0.70%~1.34% 0.75%~1.24% 0.95%~1.15%
Interest rate range-foreign
0.65%~3.80% 3.40%~4.05% 3.30%~4.50%
currency
----- End of picture text -----

As of June 30,2021, December 31,2020 and June 30,2020, the Group has endorsements to Episky Corporation (Xiamen) Ltd., Jiangsu Canyang Optoelectronics Ltd., Unikorn Semiconductor Corporation., Limited and Yenrich Technology Corporation totalling $3,757,400, $4,084,960 and $3,431,520, respectively.

(13) Short-term notes and bills payable

==> picture [468 x 53] intentionally omitted <==

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

June 30, 2021
Rate (%) Amount Name of bank Collaterals
Payables for bankers’ - $ 847,723 BANK OF COMMUNICATIONS Note 8
BANK OF CHINA
----- End of picture text -----

Payables for bankers’ acceptance	Rate (%) -	Amount Name of bank 847,723 $ BANK OF COMMUNICATIONS BANK OF CHINA June 30, 2021	Collaterals Note 8
Payables for bankers’ acceptance Payables for bankers’ acceptance		BANK OF NINGBO December31,2020
	Rate(%) -	Amount Name of bank 568,519 $ BANK OF COMMUNICATIONS June30,2020	Collaterals
			Note 8
	Rate(%) -	Amount Name of bank 581,021 $ BANK OF COMMUNICATIONS	Collaterals
			Note 8

~42~

(14) Other payables

==> picture [476 x 230] intentionally omitted <==

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

Items June 30, 2021 December 31, 2020 June 30, 2020
Payables on wages, salaries and bonus $ 693,744 $ 635,768 $ 452,305
Compensation due to employees, directors 178,484 69,641 69,641
and supervisors
Payables on personnel expense 498,841 200,259 182,902
Payables on machinery and equipment 1,244,386 2,068,473 1,350,960
Payables on consumable goods and equipment 412,810 358,304 299,001
repair expense
Payables on processing fees 701,181 377,051 283,341
Payables on reticle expense 14,773 22,319 17,994
Payables on gas expense 66,679 64,551 66,807
Payables on insurance expense 10,272 8,980 5,891
Payables on intangible assets 21,651 46,122 46,797
Others 1,047,912 536,311 430,752
$ 4,890,733 $ 4,387,779 $ 3,206,391
----- End of picture text -----

- (15) Long term borrowings

Borrowing period and

Long-term borrowings	Borrowing period and
Type of borrowings	repayment term		June30,2021
Bank borrowings
Unsecured borrowings	Before September 15, 2025	$	666,000
Unsecured borrowings	Before May 15, 2026		135,900
Unsecured borrowings	Before September 15, 2025		592,800
Unsecured borrowings	Before November 15, 2025		544,800
Unsecured borrowings	Before September 15, 2025		400,000
Unsecured borrowings	Before September 15, 2025		507,500
Unsecured borrowings	Before November 5, 2024		303,335
Unsecured borrowings	Before February 15,2026		464,400
Unsecured borrowings	Before February 15,2026		46,100
Unsecured borrowings	Before April 26, 2027		29,530
Secured borrowings	Before December 13,2024		105,325
Secured borrowings	Before March 15, 2028		100,000
Secured borrowings	Before April 12, 2026		153,400
			4,049,090
Less: Current portion of long-term borrowings		(	131,684)
		$	3,917,406
Interest rate range			0.05%~4.9875%

Interest rate range

~43~

	Borrowing period and
Type of borrowings	repayment term		December31,2020
Bank borrowings
Unsecured borrowings	Before September 15, 2025		$	383,400
Unsecured borrowings	February 17,2022 Repay fully at maturity			500,000
Unsecured borrowings	Before September 15, 2025			489,900
Unsecured borrowings	Before November 15, 2025			231,100
Unsecured borrowings	Before September 15, 2025			400,000
Unsecured borrowings	Before September 15, 2025			377,300
Unsecured borrowings	July 21,2022 Repay fully at maturity			450,000
Unsecured borrowings	Before November 5, 2024			346,667
Secured borrowings	Before December 13, 2024			159,777
				3,338,144
Less: Current portion of	long-term borrowings	(		137,419)
		$		3,200,725
Interest rate range				0.50%~1.43%
	Borrowing period and
Type of borrowings	repayment term			June30,2020
Bank borrowings
Unsecured borrowings	November 2,2021 Repay fully at maturity		$	500,000
Unsecured borrowings	Before November 5, 2024			390,000
Unsecured borrowings	February 17,2022 Repay fully at maturity			450,000
Unsecured borrowings	February 17,2022 Repay fully at maturity			500,000
Unsecured borrowings	November 27,2020 Repay fully at maturity			400,000
Unsecured borrowings	July 24,2021 Repay fully at maturity			600,000
Secured borrowings	Before December 13, 2024			120,355
				2,960,355
Less: Current portion of	long-term borrowings	(		527,820)
		$		2,432,535
Interest rate range				0.96%~1.43%

Interest rate range

Pursuant to the bank loans agreements with Taipei Fubon Bank, CTBC Bank and KGI Bank, the Company and its subsidiaries should meet certain financial covenants which are calculated based on each of their annual audited consolidated financial statements or semi-annual reviewed consolidated financial statements. The Company and its subsidiaries agreed to maintain the current ratio, debt ratio, debt service coverage ratio and tangible net worth (shareholders’ equity - intangible assets) as defined in financial covenants.

(16) Pensions

A. (a) The Company has a defined benefit pension plans in accordance with the Labor Standards Law, covering all regular employees for services provided prior to July 1, 2005, and employees who choose to remain in the defined benefit pension plan subsequent to the enforcement of the Labor Pension Act on July 1, 2005. Under the defined benefit pension plan, employees are entitled to two base points for every year of service for the first 15 years and one base point for each additional year thereafter, up to a maximum of 45 base points. The pension payment to employees is computed based on years of service and average salaries or wages of the last six months prior to approved retirement. The Company contributes an amount equal to 2% of salaries and wages paid each month to a pension fund. The pension fund is administered by a pension fund monitoring committee (the “Committee”) and

~44~

deposited under the Committee’s name in the Bank of Taiwan.

Also, the Company would assess the balance in the aforementioned labor pension reserve account by the end of December 31, every year. If the account balance is insufficient to pay the pension calculated by the aforementioned method, to the employees expected to be qualified for retirement next year, the Company will make contributions to cover the deficit by next March.

  - (b) For the aforementioned pension plan, the Group recognised pension costs of $383, $617, $767 and $1,253 for the three months and the six months ended June 30, 2021 and 2020 respectively.

  - (c) Expected contributions to the defined benefit pension plans of the Group for the year ending June 30, 2021 amount to $12,825.

B. (a) Effective July 1, 2005, the Company and its domestic subsidiaries have established a defined contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular employees with R.O.C. nationality. Under the New Plan, the Company and its domestic subsidiaries contribute monthly an amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment.
- (b) The Group’s mainland China subsidiaries have funded defined contribution plans. Monthly contributions to an independent fund administered by the government in accordance with the pension regulations in the People’s Republic of China (PRC) are based on a certain percentage stipulated by the government. Other than the monthly contributions, these companies do not have further obligations.
- (c) The pension costs under the defined contribution pension plans of the Group for the three months and the six months ended June 30, 2021 and 2020 were $85,713, $32,510, $156,986 and $70,933, respectively.
(17) Share-based payment
A. Restricted stocks to employees.

For the six months ended June 30, 2021, the Group’s restricted stocks to employees arrangement was as follows:

was as follows:
Type of arrangement	Grant date	Quantity granted (thousand shares)	Contractperiod Vesting condition 3 years Note 2
Restricted stocks to employees (Note1)	2019.03.20	8,500

Note 1: The remaining shares of Lextar in the original plan were transferred to the shares of the Company in accordance the exchange rate on the reference date of the merger.
Note 2:The employees could vest 30%, 30% and 40% of the restricted stock, respectively, if they continue to provide service to Lextar for the first year, second year and third year. However, the actual granted units should consider the situation of Lextar’s operating results and employees’ performance.

Details of the share-based payment arrangements are as follows:


Outstanding at January 1		5,950
Expired	(	2,550)
Outstanding at June 30		3,400
Exercisable at June 30(Note)		3,400

~45~

Note: Transferred into 935 thousand shares of the Company using the exchange ratio of 0.275. B. Employee stock options:

For the six months ended June 30,2021 and 2020, the share-based payment arrangements of the Company ’ s subsidiary, United LED Corporation (Hong Kong) Limited, are as follows:

		Quantity granted
Type of arrangement	Grant date	(thousand shares)	Vestingconditions
Employee stock	2010.8.1	1,500,000	Note 1
option

Note 1: 30% upon completion of 1 year’s service; 60% upon completion of 2 years’ service; 100% upon completion of 3 years’ service.

Details of the share-based payment arrangements are as follows:

	100% upon completion of 3 years’ service. Details of the share-based payment arrangements are as follows:	100% upon completion of 3 years’ service. Details of the share-based payment arrangements are as follows:
(18)	Long-term deferred revenue (shown under“Other non-current liabilities”) No.of shares Weighted-average exercise price No.of shares Weighted-average exercise price (in US dollars) (in US dollars) Options outstanding from beginning to the end of the period 1,048,700 0.0001 $ 1,048,700 0.0001 $ Options exercisable at end of the period 1,048,700 1,048,700 2021 2020 June 30,2021 December 31,2020 June 30, 2020 Deferred government grants revenue 278,448 $ 351,230 $ 395,662 $ Deferred technical services revenue 10,046 10,790 16,082 288,494 $ 362,020 $ 411,744 $
	Deferred government grants revenue Deferred technical services revenue	June 30,2021 278,448 $ 10,046 288,494 $

The Company and subsidiaries obtained government grants for acquisitions of equipment, technology investments and research projects and recognized such grants as revenue over the economic lives of those assets. Government grants revenue recognized for the three months and the six months ended June 30,2021 and 2020 were $18,234, $30,626, $69,685 and $65,000 (shown under “Other revenue”), respectively.

(19) Share capital

A. As of June 30, 2021, the Company’s authorized capital was $15,000,000, consisting of 1,500,000 thousand shares of ordinary stock (including 50,000 thousand shares reserved for employee stock options), and the paid-in capital was $6,852,514 with a par value of $10 (in dollars) per share. In accordance with Article 31 of Business Mergers and Acquisitions Act, the Company issued new shares in exchange for the stocks of Epistar and Lextrar. The procedure of share exchange was completed on January 6, 2021.

~46~

Movements of the Company’s outstanding ordinary shares are as follows (expressed in thousands of shares):

of shares):
		2021	2020
At January 1		1,074,649	1,078,336
Issuance of new shares		141,602	-
Effect of the joint share exchange	(	537,325)	-
Expiration of restricted employee stock	(	701)	-
At June 30		678,225	1,078,336

B. Epistar had completed the procedures for terminating the GDRs issued on September 22, 2009 and traded on the Luxembourg Stock Exchange in accordance with the requirements of the depository deed and custody deed ； 30,115 ordinary shares of Epistar had also been redeemed or delivered in accordance with relevant regulations.
C. Treasury shares
(a) Reason for share reacquisition and movements in the number of the Company’s treasury shares are as follows:

Thousand shares/Thousand

Reason for reacquisition At January 1 Held by subsidiaries 10,365 Redemption shares held by objecting shareholders 3,687	Increase 701 -	Decrease (Note) ( 5,884) ( 1,843) 2021	At June 30 5,182 1,844	Book value
				325,490 $ 159,647

Note ： Influence of conversion under joint share conversion agreement.

==> picture [465 x 35] intentionally omitted <==

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

2020
Reason for reacquisition At January 1 Increase Decrease At June 30 Book value
----- End of picture text -----

Held by subsidiaries 10,365 - - 10,365 325,490 $
(b) Pursuant to the R.O.C. Securities and Exchange Act, the number of shares bought back as
treasury share should not exceed 10% of the number of the Company’s issued and outstanding
shares and the amount bought back should not exceed the sum of retained earnings, paid-in
capital in excess of par value and realised capital surplus.

(c) Pursuant to the R.O.C. Securities and Exchange Act, treasury shares should not be pledged as collateral and is not entitled to dividends before it is reissued.
(d) Pursuant to the rules governing share repurchase by the Group, treasury shares should be reissued to the employees within three years from the reacquisition date and shares not reissued within the three-year period are to be retired. Treasury shares to enhance the Company’s credit rating and the stockholders’ equity should be retired within six months of acquisition.

~47~

D. Information of the Company’s shares held by subsidiaries as follows:

Lighting Investment Corporation Book value Fair value Epistar Corporation Book value Fair value	June 30,2021 1,282 thousand shares 135,163 $ 100,667 $ 5,744 thousand shares 349,974 $ 450,865 $	December 31,2020 2,565 thousand shares 135,163 $ 106,181 $	June 30,2020
			2,565 thousand shares
			135,163 $ 94,511 $

(20) Capital surplus

Pursuant to the Company Act, capital surplus, including additional paid-in capital in excess of par and donation, shall be exclusively used to cover accumulated deficit or to issue new stock or cash to shareholders in proportion to their ownership when the Company has no accumulated deficit. However, pursuant to the R.O.C. Securities and Exchange Act, capital surplus arising from paid-in capital in excess of par value on issuance of common stock and donations can be capitalized once a year, provided that the Company has no accumulated deficit and the amount to be capitalized does not exceed 10% of the paid-in capital.

										Difference between	Difference between		Change in net equity	Change in net equity	Change in net equity
									Changes in	consideration and			of associates and joint
									ownership	carrying amount of		ventures accounted			for
				Treasury share					interests in	subsidiaries acquired				under equity
		Sharepremium		transactions					subsidiaries		or disposed			method
At January 1, 2021		$	35,015,440	$	-		$		978,202	$	64,570		$	57,244
Issuance of new shares			10,308,626		-				-		-				-
Net change in the equity	(		163,827)		-				-		-				-
of associates
Additional			-		-				23,726		-				-
Changes in interests in
associates accounted for
using equity method	(		13,023)		-				-		-				-
Expiration of restricted
employee stock			7,013		-				-		-				-
Effect of the joint share
exchange	(		2,366,431)		-	(			978,202)	(	64,570)	(		57,244)
At June 30, 2021		$	42,787,798	$	-		$		23,726	$	-		$		-
										Difference between			Change in net equity
									Changes in		consideration and		of	associates and	joint
									ownership	carrying amount of			ventures accounted for
				Treasury share					interests in	subsidiaries acquired				under equity
			Sharepremium		transactions				subsidiaries		or disposed			method
At January 1, 2020		$	37,984,477	$	195,387			$	854,214	$	105,198		$	73,496
Capital surplus used to
cover accumlated deficit		(	2,969,037)	(	195,387)				-	(	105,198)					-
Additional			-			-			5,704			-				-
Changes in interests in
associates accounted for
using equity method			-			-			121,312			-				-
At June 30, 2020		$	35,015,440	$		-		$	981,230	$		-	$	73,496

~48~

(21) Unappropriated retained earnings (Accumulated deficit)

		2021		2020
At January 1	($	7,908,188)	($	3,269,622)
Effect of the joint share exchange		7,908,188		-
Profit (loss) for the period		440,229	(	2,401,929)
Remeasurement of defined benefit obligations	(	856)		3,269,622
At June 30	$	439,373	($	2,401,929)

A. In accordance with the Company’s Articles of Incorporation, 10% of current year’s earnings, after paying all taxes and dues and covering prior years’ losses, shall be appropriated as legal reserve until the total equals the issued share capital. Special reserve shall be appropriated or reversed when needed. The remaining earnings along with the prior years’ accumulated unappropriated earnings are considered as distributable earnings, and shall be retained and appropriated in proportion to the number of shares held by each shareholder accordingly.
B. The Company appropriates earnings based on the factors such as current and future investment environment, capital needs, domestic and overseas competition and capital budget, along with the consideration of shareholders’ interest and capital adequacy. The appropriation of cash dividends shall not be lower than 10% of the total dividend appropriated to shareholders.
C. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in proportion to their share ownership, the legal reserve shall not be used for any other purpose. The use of legal reserve for the issuance of stocks or cash to shareholders in proportion to their share ownership is permitted, provided that the distribution of the reserve is limited to the portion in excess of 25% of the Company’s paid-in capital.
D. In accordance with the regulations, the Company shall set aside special reserve from the debit balance on other equity items at the balance sheet date before distributing earnings. When debit balance on other equity items is reversed subsequently, the special reserve is reversed accordingly and could be included in the distributable earnings.

(22) Other equity items

At January 1, 2021 Effect of the joint share exchange Revaluation - gross Revaluation - tax Disposal of investments accounted for using equity method Currency translation –Group –Tax on Group At June 30, 2021	Unrealizedgain or loss	Currencytranslation Total 730,022) ($ 1,001,764) ($ 730,022 1,001,764 - 301,895 - 18,202) ( 45 45 186,771) ( 186,771) ( 28,009 28,009 158,717) ($ 124,976 $	Total
	271,742) ($ 271,742 301,895 18,202) ( - - - 283,693 $
			124,976 $

~49~

(23)

Operating revenue
Unrealizedgain or loss
Currencytranslation
Total
At January 1, 2020
500,148)
($ 785,337)
($ 1,285,485)
($ Revaluation - gross
88,484)
(
-

88,484)
(
Revaluation - tax
20,252

-

20,252

Disposal of investments accounted for
using equity method
-

6,364)
(
6,364)
(
Currency translation
–Group
-

207,754)
(
207,754)
(
–Tax on Group
-

41,551

41,551
–Associates
-

4,847)
(
4,847)
(
–Tax on associates
-
968

968

At June 30, 2020
568,380)
($ 961,783)
($ 1,530,163)
($
Three months ended
Three months ended
June 30,2021
June 30,2020
Revenue from contracts with customers:
Sales revenue
9,287,419
$ 3,089,209
$ Services revenue
31,203
39,201

Other operating revenue
46,279
2,456
9,364,901
$ 3,130,866
$ Six months ended
Six months ended
June 30, 2021
June 30, 2020
Revenue from contracts with customers:
Sales revenue
16,098,080
$ 6,400,027
$ Services revenue
62,159
110,677
Other operating revenue
83,521
7,890
16,243,760
$ 6,518,594
$

Disaggregation of revenue from contracts with customers

The Group derives revenue from the transfer of goods and services at a point in time in the following major product lines and geographical regions:

Three months ended			Packages/	Packages/
June 30,2021		Epi/Chip	Modules			Other			Total
Sales revenue	$	6,495,353	$	2,753,088	$	38,978		$	9,287,419
Services revenue		-		-		31,203			31,203
Other operating revenue		-		-		46,279			46,279
								$	9,364,901
Three months ended
June 30,2020		Epi/Chip			Other				Total
Sales revenue	$	2,878,195		$		211,014	$		3,089,209
Services revenue			-			39,201			39,201
Other operating revenue			-			2,456			2,456
							$		3,130,866

~50~

Six months ended June				Packages/	Packages/
30,2021		Epi/Chip		Modules			Other				Total
Sales revenue	$	10,910,464	$	5,110,544			77,072 $			$	16,098,080
Services revenue		-				-	62,159				62,159
Other operating revenue		-				-	83,521				83,521
										$	16,243,760
Six months ended June
30, 2020		Epi/Chip					Other				Total
Sales revenue	$	5,996,283			$		403,744		$		6,400,027
Services revenue				-			110,677				110,677
Other operating revenue				-			7,890				7,890
									$		6,518,594
Other income and expenses–		net
					Three months ended				Three months ended
					June	30,2021				June	30,2020
Other income
Royalty and technical income				$			4,786	$			6,800
Government grants revenue							35,663				33,052
Total				$			40,449	$			39,852
					Six months ended				Six months ended
					June	30, 2021				June	30, 2020
Other income
Royalty and technical income				$			7,770	$			14,067
Government grants revenue							87,114				84,734
Total				$			94,884	$			98,801
Interest income
					Three months ended				Three months ended
					June	30,2021				June	30,2020
Interest income from bank	deposits			`$`			`9,693`	`$`			`11,611`
Other interest income							`613`				`1,863`
Net currency exchange gains				`(`			`3,423)`	`(`			`25,214)`
				`$`			`6,883`	`($`			`11,740)`
					Six months ended				Six months ended
					June	30,2021				June	30,2020
Interest income from bank	deposits			`$`			`20,852`	`$`			`26,947`
Other interest income							`2,297`				`2,684`
Net currency exchange gains							`17,799`	`(`			`10,927)`
				`$`			`40,948`	`$`			`18,704`

(24) Other income and expenses– net

(25) Interest income

~51~

(26) Other income

(27)

Other gains and losses
Three months ended
Three months ended
June 30,2021
June 30,2020
Rental revenue
36,576
$ 34,805
$ Dividend income
27,290
168
Miscellaneous income
71,804

103,094

Total
135,670
$ 138,067
$ Six months ended
Six months ended
June 30, 2021
June 30, 2020
Rental revenue
73,172
$ 68,106
$ Dividend income
65,536

8,312
Miscellaneous income
120,257
125,621
Total
258,965
$ 202,039
$
Three months ended
Three months ended
June 30,2021
June 30,2020
Losses on disposal of property, plant and
1,052)
($ 23,107)
($ equipment
Gains on disposal of intangible assets
-
52
Gains (losses) on disposal of investments
251,830
1,433)
(
Gain on disposal of non-current assets held
for sale
-
691
Net currency exchange losses
85,960)
(
69,377)
(
Net (losses) gains on financial assets at fair
23,214)
(
167,636
value through profit or loss
Impairment loss on non-financial assets
53,409)
(
-
Miscellaneous losses
6,975)
(
79,698)
(
Total
81,220
$ 5,236)
($ Six months ended
Six months ended
June 30,2021
June 30,2020
Losses on disposal of property, plant and
4,514)
($ 19,445)
($ equipment
Gains on disposal of intangible assets
-
140
Gains (losses) on disposal of investments
247,772
1,433)
(
Gain on disposal of non-current assets held
for sale
-
691
Net currency exchange losses
118,976)
(
61,137)
(
Net losses on financial assets at fair value
57,452)
(
178,269)
(
through profit or loss
Impairment loss on non-financial assets
53,409)
(
-
Miscellaneous losses
46,487)
(
176,160)
(
Total
33,066)
($ 435,613)
($

~52~

(28) Finance costs

(28)	Finance costs	Finance costs	Finance costs
(29) (30)	Expenses by nature Note: Depreciation amounting to $7,106, $49,605, $16,376 and $101,746 were recognized as other expenses for the three months and the six months ended June 30,2021 and 2020, respectively. Employee benefit expenses Three months ended Three months ended June 30,2021 June 30,2020 Interest expense 22,095 $ 36,740 $ Other interest expense 7,090 6,775 29,185 $ 43,515 $ Six months ended Six months ended June 30,2021 June 30,2020 Interest expense 46,595 $ 59,707 $ Other interest expense 15,232 13,841 61,827 $ 73,548 $ Three months ended Three months ended June 30,2021 June 30,2020 Employee benefit expenses 2,330,647 $ 1,096,948 $ Depreciation charges on property, plant and equipment (Note) 1,265,483 $ 1,069,390 $ Amortisation charges on intangible assets 57,405 $ 62,190 $ Six months ended Six months ended June 30,2021 June 30,2020 Employee benefit expenses 4,274,903 $ 2,227,661 $ Depreciation charges on property, plant and equipment (Note) 2,464,569 $ 2,193,365 $ Amortisation charges on intangible assets 119,922 $ 128,283 $
	Wages and salaries Labor and health insurance expenses Pension costs Other personnel expenses Wages and salaries Labor and health insurance expenses Pension costs Other personnel expenses	Three months ended June 30,2021 2,034,118 $ 113,726 86,096 96,707 2,330,647 $ Six months ended June 30,2021 3,694,902 $ 231,644 157,753 190,604 4,274,903 $	Three months ended June 30,2020
			944,556 $ 69,223 33,127 50,042
			1,096,948 $
			Six months ended June 30,2020
			1,906,629 $ 142,435 72,186 106,411
			2,227,661 $

Employee benefit expenses
	Three months ended		Three months ended
		June 30,2021		June 30,2020
Wages and salaries	$	2,034,118	$	944,556
Labor and health insurance expenses		113,726		69,223
Pension costs		86,096		33,127
Other personnel expenses		96,707		50,042
	$	2,330,647	$	1,096,948
		Six months ended		Six months ended
		June 30,2021		June 30,2020
Wages and salaries	$	3,694,902	$	1,906,629
Labor and health insurance expenses		231,644		142,435
Pension costs		157,753		72,186
Other personnel expenses		190,604		106,411
	$	4,274,903	$	2,227,661

~53~

A. According to the Articles of Incorporation of the Company, the Company shall distribute employees’ compensation and directors’ remuneration based on 10%~20% and 2% of the distributable profit of the current year, respectively. If the Company has accumulated deficit, earnings should be reserved to cover losses.
B. For the three months and the six months ended June 30, 2021, employees’ compensation and directors’ remuneration were accrued at $78,612, $5,241, $78,612 and $5,241, respectively. For the three months and the six months ended June 30, 2020, the Company incurred loss and thus did not accrue employees’ compensation and directors’ and supervisors’ remuneration.
C. Information about employees’ compensation and directors’ and supervisors’ remuneration of the Company as resolved by the Board of Directors will be posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.
(31) Income tax
A. Income tax expense
- (a) Components of income tax expense :

e tax ome tax expense Components of income tax expense :
		Three months ended			Three months ended
			June 30,2021			June 30,2020
Current tax:
Current tax on profits for the period	$		44,399	$		7,881
Prior year income tax underestimation			127			180
Total current tax			44,526			8,061
Deferred tax:
Origination and reversal of temporary
differences			5,390			57,112
Total deferred tax			5,390			57,112
Income tax expense	$		49,916	$		65,173
			Six months ended			Six months ended
			June 30,2021			June 30,2020
Current tax:
Current tax on profits for the period	$		67,407	$		11,241
Prior year income tax overestimation	(		1,146)	(		885)
Total current tax			66,261			10,356
Deferred tax:
Origination and reversal of temporary
differences			5,663			17,417
Total deferred tax			5,663			17,417
Income tax expense	$		71,924	$		27,773

(b) The income tax (charge)/credit relating to components of other comprehensive income is as follows:

~54~

==> picture [444 x 290] intentionally omitted <==

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

Three months ended Three months ended
June 30, 2021 June 30, 2020
Change in fair value of financial assets $ 56,447 ($ 60,416)
at fair value through other
comprehensive income
Currency translation differences ( 17,314) ( 25,043)
Share of other comprehensive income
of associates 570 ( 212)
Total $ 39,703 ($ 85,671)
Six months ended Six months ended
June 30, 2021 June 30, 2020
Change in fair value of financial assets $ 18,202 ($ 20,252)
at fair value through other
comprehensive income
Currency translation differences ( 27,909) ( 41,551)
Share of other comprehensive income
of associates ( 100) ( 968)
Total ($ 9,807) ($ 62,771)
----- End of picture text -----

B. As the Company was established on January 6, 2021, no income tax returns were filed before. The income tax returns through 2018 of both of the Company’s significant subsidiaries, Epistar and Lextar, have been assessed and approved by the Tax Authority.

(32) Earnings (losses) per share

Earnings (losses) per share
Basic earnings per share Profit attributable to the parent Diluted earnings per share Profit attributable to ordinary shareholders of the parent Employees' compensation Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares	Three months ended June 30,2021
	Amount after tax 700,159 $ 700,159 $ - 700,159 $	Weighted average number of outstanding ordinary shares (share in thousands) 677,290 677,290 982 678,272	Earnings per share (in dollars)
			1.03 $
			1.03 $

~55~

==> picture [474 x 100] intentionally omitted <==

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

Three months ended June 30, 2020
Weighted average
number of outstanding
ordinary shares Losses per share
Amount after tax (share in thousands) (in dollars)
Basic losses per share
Losses attributable to the parent ($ 909,129) 539,168 ($ 1.69)
----- End of picture text -----

Amount after tax Basic losses per share Losses attributable to the parent 909,129) ($	Amount after tax 909,129) ($	number of outstanding ordinary shares Losses per share (share in thousands) (in dollars) 539,168 1.69) ($	number of outstanding ordinary shares Losses per share (share in thousands) (in dollars) 539,168 1.69) ($
Amount after tax Basic earnings per share Profit attributable to the parent 440,229 $ Diluted earnings per share Profit attributable to ordinary shareholders of the parent 440,229 $ Employees' compensation - Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares 440,229 $ Six Amount after tax Basic losses per share Losses attributable to the parent 2,401,929) ($ Six	Six	months ended June 30,2021
	Amount after tax 440,229 $ 440,229 $ - 440,229 $ Six	Weighted average number of outstanding ordinary shares Earnings per share (share in thousands) (in dollars) 677,290 0.65 $ 677,290 491 677,781 0.65 $ months ended June 30,2020	Earnings per share (in dollars)
			0.65 $
			0.65 $
		Weighted average number of outstanding ordinary shares Losses per share (share in thousands) (in dollars) 539,168 4.45) ($	Losses per share (in dollars)

(33) Business combinations

A. The Company acquired 100% ordinary shares of Lextar, primarily involved in manufacturing LED wafers, chips, packages and modules, in the way of share exchange. The Company expects to strengthen the strategic cooperative relationship after the acquisition.
B. The following table summarises the consideration paid for Lextar and the fair values of the assets acquired and liabilities assumed at the acquisition date, as well as the fair value of the noncontrolling interest at the acquisition date:

controlling interest at the acquisition date:
Purchase consideration Equity instruments Fair value of the non-controlling interest		January6,2021
		11,724,646 $ 239,900 11,964,546

~56~

		January 6,2021
Fair value of the identifiable assets acquired and liabilities assumed
Cash		3,763,629
Financial assets at fair value through profit or loss - current		20,629
Notes and accounts receivable (including related parties)		2,817,398
Other financial assets-current		456,787
Inventories		1,088,852
Other current assets		210,038
Financial assets at fair value through other comprehensive income-
current		116,471
Non-current financial assets at amortised cost		39,340
Investments accounted for under equity method		270,320
Property, plant and equipment		4,714,507
Right-of-use assets		384,837
Investment property		463,943
Intangible assets		427,417
Deferred income tax asset		52,158
Other non-current asset		505,036
Financial liabilities at fair value through profit or loss - current	(	4,894)
Notes and accounts receivable (including related parties)	(	2,284,242)
Payables on equipment	(	174,620)
Current lease liabilities	(	26,532)
Other current liabilities	(	1,176,593)
Non-current lease liabilities	(	387,498)
Other non-current liabilities	(	7,731)
Deferred income tax liabilities	(	16,636)
Total net assets		11,252,616
Goodwill	$	711,930

C. The fair value of property and plant is recognised in the amount of $4,714,507 as the first estimate and is provisional pending receipt of the final valuations for those assets.

D. The operating revenue included in the consolidated statement of comprehensive income since January 6,2021 contributed by Lextar Electronics Corp. was $4,900,508. Lextar Electronics Corp. also contributed profit before income tax of $118,360 over the same period. Had Lextar Electronics Corp. been consolidated from January 1, 2021, the consolidated statement of comprehensive income would show operating revenue of $4,900,508 and profit before income tax of $118,360.

~57~

(34) Supplemental cash flow information

A. Investing activities with partial cash payments

Supplemental cash flow information A. Investing activities with partial cash payments
		Six months ended		Six months ended
		June 30,2021		June 30,2020
Purchase of property, plant and equipment	$	2,026,400	$	2,035,434
Add: Opening balance of payable
on equipment		2,068,474		545,544
Add: Ending balance of prepayment
for equipment		257,204		537,125
Less: Ending balance of payable
on equipment	(	1,244,386)	(	1,350,960)
Less: Opening balance of prepayment
for equipment	(	265,386)	(	144,179)
Acquired from business combinations	(	24,999)		-
Cash paid during the period	$	2,817,307	$	1,622,964
		Six months ended		Six months ended
		June 30, 2021		June 30, 2020
Purchase of intangible assets	$	2,172	$	4,101
Add: Opening balance of payables (including non-current portion)		46,122		94,525
Less: Ending balance of payables (including non-current portion)	(	21,651)	(	70,413)
Cash paid during the period	$	26,643	$	28,213
B. Investing activities with partial cash received
		Six months ended		Six months ended
		June 30,2021		June 30, 2020
Sale of property, plant and equipment	$	44,271	$	24,333
Add: Opening balance of receivables		2,000		2,000
Less: Ending balance of receivables	(	2,559)	(	2,000)
Cash collected during the period	$	43,712	$	24,333
C. Cash received from disposal of ownership interests in subsidiaries
		Six months ended		Six months ended
		June 30,2021		June 30,2020
Disposal proceeds	$	-	$	-
Add: Opening balance of receivables		17,093		17,093
Less: Ending balance of receivables	(	17,093)	(	17,093)
Net cash provided by disposal of subsidiaries	$	-	$	-

~58~

(35) Changes in liabilities from financing activities

									Short-term				Guarantee	Guarantee			Liabilities from
		Short-term			Long-term		notes and bills					Lease		deposits	financing activities
			borrowing		borrowing				payable			liabilities		received			gross
At January 1, 2021		$	1,537,574	$	3,338,144			$	568,519		$	1,286,306	$	115,408		$	6,845,951
Acquired from business			-			-			310,580			414,030		2,894			727,504
combinations
Changes in cash flow from
financing activities			979,605		712,486		(		24,818)	(		65,789)		2,199			1,603,683
Effect of interest			-			-			-			11,819		-			11,819
Effect of exchange rate	(		7,201)	(	1,540)		(		6,558)	(		40,287)	(	2,744)	(		58,330)
At June 30, 2021		$	2,509,978	$	4,049,090			$	847,723		$	1,606,079	$	117,757		$	9,130,627
									Short-term				Guarantee				Liabilities from
		Short-term			Long-term		notes and bills					Lease		deposits	financing activities
		borrowing			borrowing				payable			liabilities		received			gross
At January 1, 2020		$	1,683,783	$	1,128,558			$	346,318		$	1,371,449	$	62,370		$	4,592,478
Changes in cash flow from
financing activities	(		485,306)		1,831,797				247,819	(		52,641)		25,329			1,566,998
Effect of interest			-			-			-			13,461		-			13,461
Additions			-			-			-			39,543		-			39,543
Effect of exchange rate	(		32,201)			-	(		13,116)	(		1,531)	(	1,960)	(		48,808)
At June 30, 2020		$	1,166,276	$	2,960,355			$	581,021		$	1,370,281	$	85,739		$	6,163,672

7. RELATED PARTY TRANSACTIONS

(1) Names of related parties and relationship

LATED PARTY TRANSACTIONS
Names of related parties and relationship
At June 30, 2020
1,166,276
$ 2,960,355
$ 581
$

,021
1,370,281
$ 85,739
$ 6,163,672
$

Names of relatedparties

Relationshipwith the Group

Country Lighting(BVI) Co., Ltd.
ES -LEDRU LLC.
LEDOLUX Sp. Zo. O.
LEDAZ Co., Ltd.
First Vertical Laser Inc.
Interlight Optotech (HK) CO., Limited
GCS Holdings, Inc.
Tekcore Co., Ltd.
Changzhou Chemsemi Co., Ltd.
Joint Power Exponent, Ltd.
iReach Corporation
TE Opto Corporation
Chuzhou Bwin Technology corp.
CreeLED Hong Kong Ltd.
CreeLED, Inc.
LEYARD EUROPE s.r.o.
Seoul Semiconductor Co., Ltd.
Seoul Viosys Co. ,Ltd.
AU Optronics (Kunshan) Co., Ltd.
AU Optronics (Xiamen) Corp.
AU Optronics (Suzhou) Corp Ltd.
AU Optronics Corp.

Associates
Associates (Note 3)
Associates
Associates
Associates (Note 2)
Associates
Associates
Associates (Note 4)
Associates
Associates
Associates (Note 2)
Associates
Associates
Other related parties (Note 1)
Other related parties (Note 1)
Other related parties
Other related parties
Other related parties
Other related parties
Other related parties
Other related parties
Other related parties

~59~

==> picture [482 x 15] intentionally omitted <==

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

Names of related parties Relationship with the Group
----- End of picture text -----

Names of relatedparties	Relationship with theGroup
Leyard Optoelectronic Co., Ltd.	Other related parties
Leyard TV Technology Co., Ltd.	Other related parties
Shenzhen Leyard Opto-Electronic Co.,	Other related parties
Darwin Precision’s (Xiamen) Co., Ltd.	Other related parties
Darwin Precisions Corporation	Other related parties
Fortech Electronics (Kunshan) Co., Ltd	Other related parties
Fortech Electronics (Suzhou) Co., Ltd	Other related parties

Note 1:It is no longer the company’s other related party beginning on April, 2021.

Note 2: The Group lost control over First Vertical Laser Inc. and iReach Corporation in June 2021, and thus transferred the entities from consolidated entities to related parties.

Note 3: It is no longer the company’s other related party beginning on December, 2020. Note 4: It is no longer the company’s other related party beginning on May, 2021.

(2) Significant related party transactions and balances A. Operating revenue:

Significant related party transactions A. Operating revenue:	and balances	and balances
	Three months ended		Three months ended
		June 30,2021	June 30,2020
Other related parties	$	416,375	164 $
Associates		208,922	102,179
Total	$	625,297	102,343 $
		Six months ended	Six months ended
		June 30,2021	June 30,2020
Other related parties	$	1,008,997	374 $
Associates		389,307	234,591
Total	$	1,398,304	234,965 $
All other sales prices to related parties are the same		as those to third parties.
B. Purchases:
	Three months ended		Three months ended
		June 30,2021	June 30,2020
Other related parties	$	88,923	57 $
		Six months ended	Six months ended
		June 30,2021	June 30,2020
Other related parties	$	165,831	107 $

Due to the product variety, the purchase price from the above related parties was not comparable to other suppliers while other products have no difference with market price. The payment terms to related parties are the same as those to third parties.

~60~

C. Receivables from related parties:

Others Associates Total	June 30,2021 308,483 $ 300,516 608,999 $	December 31,2020 279 $ 214,944 215,223 $	June 30,2020
			74 $ 217,199
			217,273 $

The receivables from related parties arise mainly from sale transactions. The receivables are unsecured in nature and bear no interest..

D. Other receivables from related parties:

		June 30,2021	December 31,2020	December 31,2020		June 30,2020
Others	$	5,604	$	8,556	$	1,687
Associates		24,765		-		-
Total	$	30,369	$	8,556	$	1,687
The other receivables from		related parties arise	mainly from rent and service.
Payables from related parties:
		June 30,2021	December 31,2020			June 30,2020
Associates	$	178,018	$	174,250	$	286,113
Others		74,736		-		-
Total	$	252,754	$	174,250	$	286,113

E. Payables from related parties:

The payables to related parties arise mainly from purchase transactions. The payables bear no interest.

(3) Key management compensation

interest. Key management compensation
Three months ended June 30,2021 Salaries and other short-term employee benefits 36,948 $ Post-employment benefits 724 Termination benefits - Share-based payment 2,640 Total 40,312 $ Six months ended June 30,2021 Salaries and other short-term employee benefits 91,253 $ Post-employment benefits 1,664 Termination benefits - Share-based payment 16,149) ( Total 76,768 $	Three months ended June 30,2020
	21,324 $ 558 13 -
	21,895 $
	Six months ended June 30,2020
	50,285 $ 1,235 30 -
	51,550 $

~61~

8. PLEDGED ASSETS

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

Book value

==> picture [507 x 235] intentionally omitted <==

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

Pledgrd assets June 30, 2021 December 31, 2020 June 30, 2020 Purpose
Bank deposits $ 301,560 $ 330,295 $ 153,149 Payables for bankers’
(shown in "Other assets- acceptance
current")
Time deposits 446,513 162,885 108,131 Lease deposit,
(Shown in "Other assets- performance bond,
current and other assets- security for provisional
noncurrent") attachment, customer
deposit, collateral
deposits for provisional
seizure
Notes receivable 192,240 197,396 546,642 Short-term borrowings
Land, building and
553,923 270,683 270,683 Long-term borrowings
structures
Machinery Long-term borrowings
and office equipment 111,873 63,111 64,947
$ 1,606,109 $ 1,024,370 $ 1,143,552
----- End of picture text -----

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACT

COMMITMENTS

Capital expenditure contracted for at the balance sheet date but not yet incurred is as follows: Contracted but not provided

==> picture [497 x 29] intentionally omitted <==

10. SIGNIFICANT DISASTER LOSS

None.

11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE

None.

12. OTHERS

(1) Capital risk management

The Group’s capital management policy is established taking into account the industry characteristics, the Group’s future development and changes in external environments. The Group plans the working capital, capital expenditures, investments and dividends required for the future based on the capital management policy, makes financial analysis, and examines its capital structure periodically and makes appropriate adjustments to ensure that every company within the Group may grow and operate indefinitely.

~62~

(2) Financial instruments

A Financial instruments by category

nancial instruments Financial instruments by category
Financial assets Financial assets at fair value through profit or loss Financial assets mandatorily measured at fair value through profit or loss Financial assets at fair value through other comprehensive income Designation of equity instrument Financial assets at amortised cost Cash and cash equivalents Notes receivable Accounts receivable Accounts receivable due from related parties Other receivables Other receivables due from related parties Guarantee deposits paid Other financial assets Financial liabilities Financial liabilities at fair value through profit and loss Financial liabilities held for trading Financial liabilities at amortised cost Short-term borrowings Short-term notes payable Notes payable Accounts payable Accounts payable to related parties Other payables Long-term borrowings (including current portion) Long-term accounts payable Guarantee deposits received Lease liabilities (including current portion)	June 30,2021 December 31,2020 278,411 $ 350,045 $ 5,647,963 4,384,300 6,481,836 5,228,011 1,170,303 1,086,061 11,322,044 6,288,351 608,999 215,223 150,892 163,487 30,369 8,556 31,035 12,320 781,474 504,783 26,503,326 $ 18,241,137 $ 1,829 $ - $ 2,509,978 1,537,574 847,723 568,519 8,790 11,002 3,938,843 1,998,922 252,754 174,250 4,890,733 4,387,779 4,049,090 3,338,145 - - 117,757 115,408 16,617,497 $ 12,131,599 $ 1,606,079 $ 1,286,306 $	June 30,2020
		304,976 $ 3,484,195 6,275,818 1,340,672 5,784,129 217,273 190,071 1,687 11,717 287,124
		17,897,662 $
		- $ 1,166,276 581,021 10,401 1,293,292 286,113 3,206,391 2,960,355 23,616 85,739
		9,613,204 $
		1,370,281 $

B. Financial risk management policies

(a) The Group’s activities expose it to a variety of financial risks: market risk (including foreign

~63~

exchange risk, interest rate risk and price risk), credit risk and liquidity risk. The purpose of risk management is to minimise potential adverse effects arising from uncertainty on the Group’s financial performance.

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

Foreign exchange risk

i. The Group operates internationally and is exposed to exchange rate risk arising from the transactions of the Company and its subsidiaries used in various functional currency, primarily with respect to the USD and RMB. Exchange rate risk arises from future commercial transactions and recognised assets and liabilities.
ii. Management has set up a policy to require the Group to manage their foreign exchange risk against their functional currency. The companies are required to hedge their entire foreign exchange risk exposure with the Company treasury.
iii. The Group’s businesses involve some non-functional currency operations (the functional currency of the Company and certain subsidiaries is NTD while that of other subsidiaries are USD and RMB). The information on assets and liabilities denominated in foreign currencies whose values would be materially affected by the exchange rate fluctuations is as follows:

==> picture [427 x 62] intentionally omitted <==

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

June 30, 2021
Foreign currency
amount Book value
(in Thousands) Exchange rate (in Thousands of NTD)
----- End of picture text -----

(Foreign currency:
functional currency)
Financial assets
Monetary items
USD:NTD	$	343,395	27.860	$	9,566,985
RMB:NTD		439,961	4.309		1,895,792
Non-monetary items
USD:NTD		96,306	27.860		2,683,085
Financial liabilities
Monetary items
USD:NTD		163,726	27.860		4,561,406
RMB:NTD		261,128	4.309		1,125,201

~64~

			December 31,2020	December 31,2020
	Foreign currency
		amount			Book value
		(in Thousands)	Exchange rate	(in Thousands of NTD)
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD:NTD	$	220,340	28.480	$	6,275,280
RMB:NTD		464,597	4.377		2,033,543
Non-monetary items
USD:NTD		97,092	28.480		2,769,539
Financial liabilities
Monetary items
USD:NTD		89,698	28.480		2,554,596
RMB:NTD		246,593	4.377		1,079,338
			June 30,2020
	Foreign currency
		amount			Book value
		(in Thousands)	Exchange rate	(in Thousands of NTD)
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD:NTD	$	189,222	29.630	$	5,606,633
RMB:NTD		476,577	4.191		1,997,333
Non-monetary items
USD:NTD		103,164	29.630		3,056,751
Financial liabilities
Monetary items
USD:NTD		67,138	29.630		1,990,792
RMB:NTD		199,306	4.191		835,293
iv. Please refer to the following		table for the details of unrealized exchange gain (loss) arising
from significant foreign	exchange variation on		the monetary items held by the Group.

~65~

==> picture [429 x 457] intentionally omitted <==

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

Six months ended June 30, 2021
Unrealized exchange gain (loss)
Foreign currency
amount Book value
(in Thousands) Exchange rate (in Thousands of NTD)
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD:NTD $ - 27.860 ($ 60,802)
RMB:NTD - 4.309 ( 26,529)
Financial liabilities
Monetary items
USD:NTD - 27.860 3,375
RMB:NTD - 4.309 910
Six months ended June 30, 2020
Unrealized exchange gain (loss)
Foreign currency
amount Book value
(in Thousands) Exchange rate (in Thousands of NTD)
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD:NTD $ - 29.630 ($ 68,871)
RMB:NTD - 4.1910 ( 57,718)
Financial liabilities
Monetary items
USD:NTD - 29.630 23,549
RMB:NTD - 4.1910 12,985
----- End of picture text -----

v. Analysis of foreign currency market risk arising from significant foreign exchange variation:

~66~

(Foreign currency: functional currency) Financial assets Monetary items USD:NTD RMB:NTD Financial liabilities Monetary items USD:NTD RMB:NTD (Foreign currency: functional currency) Financial assets Monetary items USD:NTD RMB:NTD Financial liabilities Monetary items USD:NTD RMB:NTD	Degree of variation Effect on profit or loss Effect on other comprehensive income 1% 95,670 $ - $ 1% 18,958 - 1% 45,614) ( - 1% 11,252) ( - Six months ended June 30,2021 Sensitivityanalysis Degree of variation Effect on profit or loss Effect on other comprehensive income 1% 56,066 $ - $ 1% 19,973 - 1% 19,908) ( - 1% 8,353) ( - Six months ended June 30,2020 Sensitivityanalysis	Degree of variation Effect on profit or loss Effect on other comprehensive income 1% 95,670 $ - $ 1% 18,958 - 1% 45,614) ( - 1% 11,252) ( - Six months ended June 30,2021 Sensitivityanalysis Degree of variation Effect on profit or loss Effect on other comprehensive income 1% 56,066 $ - $ 1% 19,973 - 1% 19,908) ( - 1% 8,353) ( - Six months ended June 30,2020 Sensitivityanalysis	Degree of variation Effect on profit or loss Effect on other comprehensive income 1% 95,670 $ - $ 1% 18,958 - 1% 45,614) ( - 1% 11,252) ( - Six months ended June 30,2021 Sensitivityanalysis Degree of variation Effect on profit or loss Effect on other comprehensive income 1% 56,066 $ - $ 1% 19,973 - 1% 19,908) ( - 1% 8,353) ( - Six months ended June 30,2020 Sensitivityanalysis
		56,066 $ 19,973 19,908) ( 8,353) (	- $ - - -

Price risk

i. The Group’s equity securities, which are exposed to price risk, are the held financial assets at fair value through profit or loss, financial assets at fair value through other comprehensive income. To manage its price risk arising from investments in equity securities, the Group diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the Group.
ii.The Group’s investments in equity securities comprise shares and open-end funds issued by the domestic companies. The prices of equity securities would change due to the change of the future value of investee companies. If the prices of these equity securities had increased/decreased by 10% with all other variables held constant, post-tax profit for the six months ended June 30, 2021 and 2020 would have increased/decreased by $27,841 and $30,498, respectively, as a result of gains/losses on equity securities classified as at fair value through profit or loss. Other components of equity would have increased/decreased by $564,796 and $348,420, respectively, as a result of other comprehensive income classified as equity investment at fair value through other comprehensive income.
Interest rate risk
i. The Group’s interest rate risk arises from bank deposits and long-term borrowings. Borrowings issued at variable rates expose the Group to cash flow interest rate risk which

~67~

is partially offset by cash and cash equivalents held at variable rates. Borrowings issued at fixed rates expose the Group to fair value interest rate risk. The Group’s borrowings at variable rate were denominated in the USD, RMB and NTD.

ii. Based on the simulations performed on sensitivity analysis for interest rate risk, the maximum impact on post-tax profit of a 0.1% shift would be increased/decreased of $3,647 and $2,146 for the six months ended June 30, 2021 and 2020, respectively. The simulation is done on a quarterly basis to ensure that the potential maximum loss is within the limit set by the management.
(b) Credit risk
i. Credit risk refers to the risk of financial loss to the Group arising from default by the clients or counterparties of financial instruments on the contract obligations. The main factor is that counterparties could not repay in full the accounts receivable based on the agreed terms, and the contract cash flows of debt instruments stated at amortised cost.
ii. The Group adopts the assumptions that the default occurs when the contract payments are past due over a certain number of days.
iii. The Group adopts the following assumptions under IFRS 9 to assess whether there has been a significant increase in credit risk on that instrument since initial recognition: If the contract payments were past due over a certain number of days based on the terms, there has been a significant increase in credit risk on that instrument since initial recognition.
iv. The following indicators are used to determine whether the credit impairment of debt instruments has occurred:
(i) It becomes probable that the issuer will enter bankruptcy or other financial reorganization due to their financial difficulties;
(ii) The disappearance of an active market for that financial asset because of financial difficulties;
(iii) Default or delinquency in interest or principal repayments;
(iv) Adverse changes in national or regional economic conditions that are expected to cause a default.
v. The Group classifies customers’ accounts receivable in accordance with credit rating of customer. The Group applies the simplified approach using provision matrix, loss rate methodology to estimate expected credit loss under the provision matrix basis.
vi. The Group wrote-off the financial assets, which cannot be reasonably expected to be recovered, after initiating recourse procedures. However, the Group will continue executing the recourse procedures to secure their rights. As of June 30,2021, December 31,2020 and June 30,2020, the Group’s written-off financial assets that are still under recourse procedures all amounted to $16,753.
vii. The Group used the forecastability to adjust historical and timely information to assess the default possibility of accounts receivable and other receivables. As of June 30,2021, December 31,2020 and June 30, 2020, the provision matrix, loss rate methodology is as follows:

~68~

==> picture [456 x 496] intentionally omitted <==

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

Up to 30 days 31~90 days 91~180 days Over 180 days
Not past due past due past due past due past due Total
June 30, 2021
Expected loss rate 0~5% 0~5% 0~56% 0~100% 0~100%
Total book value $ 12,586,808 $ 520,278 $ 162,759 $ 123,488 $ 944,865 $ 14,338,198
Loss allowance $ 4,740 $ 24,056 $ 26,937 $ 58,931 $ 940,927 $ 1,055,591
Up to 30 days 31~90 days 91~180 days Over 180 days
Not past due past due past due past due past due Total
December 31, 2020
Expected loss rate 0~5% 0~5% 0~56% 0~100% 0~100%
Total book value $ 7,225,686 $ 326,702 $ 176,962 $ 869,951 $ 63,606 $ 8,662,907
Loss allowance $ 4,591 $ 13,490 $ 71,546 $ 766,225 $ 45,377 $ 901,229
Up to 30 days 31~90 days 91~180 days Over 180 days
Not past due past due past due past due past due Total
June 30, 2020
Expected loss rate 0~5% 0~5% 0~56% 0~100% 0~100%
Total book value $ 7,070,921 $ 332,956 $ 328,627 $ 186,447 $ 99,244 $ 8,018,195
Loss allowance $ 410,561 $ 333 $ 1,832 $ 9,637 $ 62,000 $ 484,363
Individual provision Group provision Total
June 30, 2021
Expected loss rate 19.45%~100% 0%~100%
Total book value $ 1,028,852 $ 13,309,346 $ 14,338,198
Loss allowance $ 1,028,852 $ 26,739 $ 1,055,591
Individual provision Group provision Total
December 31, 2020
Expected loss rate 19.10%~100% 0%~100%
Total book value $ 869,582 $ 7,793,325 $ 8,662,907
Loss allowance $ 869,582 $ 31,647 $ 901,229
Individual provision Group provision Total
June 30, 2020
Expected loss rate 61.57%~100% 0.01%~100%
Total book value $ 447,752 $ 7,570,443 $ 8,018,195
Loss allowance $ 447,752 $ 36,611 $ 484,363
----- End of picture text -----

vii. Movements in relation to the Company applying the simplified approach to provide loss allowance for accounts receivable, and other receivables are as follows:

~69~

2021

	2021	1
At January 1 Acquired from business combination Provision for impairment Reversal of impairment Write-offs Disposal of subsidiaries Effect of exchange rate changes At June 30 At January 1 Provision for impairment Reversal of impairment Write-offs Effect of exchange rate changes At June 30	Accounts receivable (including notes receivable) Other receivables 858,748 $ 42,481 $ 13,071 - 108,849 57,835 22,391) ( - 61) ( - 2,704) ( - 237) ( - 955,275 $ 100,316 $ Accounts receivable (including notes receivable) Other receivables 10,672 $ 23,125 $ 470,827 9,246 28,509) ( - 565) ( - 433) ( - 451,992 $ 32,371 $ 2020	Other receivables
		42,481 $ - 57,835 - - - -
		100,316 $

(c) Liquidity risk
i. Cash flow forecasting is performed in the operating entities of the Group and aggregated by Group treasury. Group treasury monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Group does not breach borrowing limits or covenants on any of its borrowing facilities. Such forecasting takes into consideration the Group’s debt financing plans, covenant compliance, compliance with internal balance sheet ratio targets and external regulatory or legal requirements.
ii. Surplus cash are invested in interest bearing current accounts, time deposits, money market deposits and marketable securities, with appropriate maturities or sufficient liquidity to provide sufficient headroom and meet the above-mentioned forecasts. As of June 30,2021, December 31,2020 and June 30,2020, the Group held money market position of $6,694,561, $5,398,781 and $6,427,908, respectively, and those are expected to readily generate cash inflows for managing liquidity risk.
iii. The table below shows analysis of the Group’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

~70~

Non-derivative financial liabilities:

Non-derivative financial liabilities:
June 30, 2021 Short-term borrowings Short-term notes and bills payable Financial liabilities at fair value through profit or loss Notes payable Accounts payable (including related parties) Other payables	Less than 1year 2,509,978 $ 847,723 1,829 8,790 4,191,597 4,890,733 128,699 132,526 114,717 Less than 1year 1,537,574 $ 568,519 11,002 2,173,172 4,387,779 128,977 138,316 114,742 Less than 1year 1,166,276 $ 581,021 10,401 1,579,405 3,206,391 106,862 529,713 - 85,206	Between 1 and5 years - $ - - - - - 429,630 3,975,587 2,374 Between 1 and5 years - $ - - - - 280,152 3,271,280 - Between 1 and5 years - $ - - - - 321,648 2,475,367 23,616 -	Between5and 7years - $ - - - - - 343,436 51,881 666 Between 5 and 7 years - $ - - - - 116,566 - 666 Between5and 7years - $ - - - - 121,372 - - 533	Over 7years
				- $ - - - - - 1,059,297 - - Over 7 years
Lease liabilities
Long-term borrowings (including current portion) Deposit received Non-derivative financial liabilities: December 31, 2020 Short-term borrowings Short-term notes and bills payable Notes payable Accounts payable (including related parties) Other payables Lease liabilities Long-term accounts payable (including current portion) Deposit received Non-derivative financial liabilities: June 30, 2020 Short-term borrowings Short-term notes and bills payable Notes payable Accounts payable - related ( including related parties) Other payables Lease liabilities Long-term borrowings (including current portion) Long-term accounts payable (including current portion) Deposit received
				- $ - - - - 1,088,058 - - Over 7years
				- $ - - - - 1,192,433 - - -

iv. The Group does not expect the timing of the estimated cash outflows through the maturity date analysis will be significantly earlier, or expect the actual cash flow amount will be significantly different.

(3) Fair value information

A. The different levels that the inputs to valuation techniques are used to measure fair value of financial and non-financial instruments have been defined as follows:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. A market is regarded as active where a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. The fair value of the Group’s investment in listed stocks and beneficiary certificates is included in Level 1.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. The fair value of the Group’s investment in convertible bonds and most derivative instruments is included in Level 2.

~71~

Level 3: Unobservable inputs for the asset or liability. The fair value of the Group’s investment in equity investment without active market is included in Level 3.

B. Financial instruments not measured at fair value
(a) Except for those listed in the table below, the carrying amounts of cash and cash equivalents, notes receivable, accounts receivable, other receivables, refundable deposits, other financial assets, short-term borrowings, short-term notes and bills payable, notes payable, accounts payable, other payables, lease liabilities, long-term accounts payable and guarantee deposits received are approximate to their fair values.

received are approximate to their	fair values.
Financial liabilities: Long-term borrowings (including current portion) Financial liabilities: Long-term borrowings (including current portion) Financial liabilities: Long-term borrowings (including current portion)	Book value 4,049,090 $ Book value 3,338,145 $ Book value 2,960,355 $	Level 1 Level 2 - $ 4,087,868 $ Fair value June 30,2021 December 31,2020 Fair value		Level 3
				- $

		Level 1 Level 2 - $ 3,379,079 $ June 30,2020 Fair value		Level 3
				- $

		Level 1 - $	Level 2 2,985,973 $	Level 3
				- $

(b) The methods and assumptions of fair value estimate are as follows: Long-term borrowings: They are measured at present value, which is calculated based on the cash flow expected to be paid and discounted using a market rate prevailing at balance sheet date.
C. The related information of financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets and liabilities at June 30, 2021, December 31, 2020 and June 30, 2020 is as follows:
(a) The related information of natures of the assets and liabilities is as follows:

~72~

(b)	The methods and assumptions the Group used to measure fair value are as follows: i. The instruments the Group used market quoted prices as their fair values (that is, Level 1 are listed below by characteristics: June 30, 2021 Level 1 Level 2 Level 3 Total Assets Recurring fair value measurements Financial assets at fair value through profit or loss Equity securities 121,119 $ - $ 65,686 $ 186,805 $ Beneficiary certificates 84,319 - - 84,319 Derivatives - 7,287 - 7,287 Financial assets at fair value through other comprehensive income Equity securities 1,465,542 - 4,182,421 5,647,963 Total 1,670,980 $ 7,287 $ 4,248,107 $ 5,926,374 $ Liabilities Recurring fair value measurements Financial liabilities at fair value through profit or loss Derivatives - $ 1,829 $ - $ 1,829 $ December 31, 2020 Level 1 Level 2 Level 3 Total Assets Recurring fair value measurements Financial assets at fair value through profit or loss Equity securities 130,533 $ - $ 179,275 $ 309,808 $ Beneficiary certificates 40,237 - - 40,237 Financial assets at fair value through other comprehensive income Equity securities 460,640 - 3,923,660 4,384,300 Total 631,410 $ - $ 4,102,935 $ 4,734,345 $ June 30, 2020 Level 1 Level 2 Level 3 Total Assets Recurring fair value measurements Financial assets at fair value through profit or loss Equity securities 72,192 $ - $ 152,886 $ 225,078 $ Beneficiary certificates 79,898 - - 79,898 Financial assets at fair value through other comprehensive income Equity securities 267,926 - 3,216,269 3,484,195 Total 420,016 $ - $ 3,369,155 $ 3,789,171 $ Listed shares Closed-end fund Open-end fund Market quoted price Closing price Closing price Net asset value	The methods and assumptions the Group used to measure fair value are as follows: i. The instruments the Group used market quoted prices as their fair values (that is, Level 1 are listed below by characteristics: June 30, 2021 Level 1 Level 2 Level 3 Total Assets Recurring fair value measurements Financial assets at fair value through profit or loss Equity securities 121,119 $ - $ 65,686 $ 186,805 $ Beneficiary certificates 84,319 - - 84,319 Derivatives - 7,287 - 7,287 Financial assets at fair value through other comprehensive income Equity securities 1,465,542 - 4,182,421 5,647,963 Total 1,670,980 $ 7,287 $ 4,248,107 $ 5,926,374 $ Liabilities Recurring fair value measurements Financial liabilities at fair value through profit or loss Derivatives - $ 1,829 $ - $ 1,829 $ December 31, 2020 Level 1 Level 2 Level 3 Total Assets Recurring fair value measurements Financial assets at fair value through profit or loss Equity securities 130,533 $ - $ 179,275 $ 309,808 $ Beneficiary certificates 40,237 - - 40,237 Financial assets at fair value through other comprehensive income Equity securities 460,640 - 3,923,660 4,384,300 Total 631,410 $ - $ 4,102,935 $ 4,734,345 $ June 30, 2020 Level 1 Level 2 Level 3 Total Assets Recurring fair value measurements Financial assets at fair value through profit or loss Equity securities 72,192 $ - $ 152,886 $ 225,078 $ Beneficiary certificates 79,898 - - 79,898 Financial assets at fair value through other comprehensive income Equity securities 267,926 - 3,216,269 3,484,195 Total 420,016 $ - $ 3,369,155 $ 3,789,171 $ Listed shares Closed-end fund Open-end fund Market quoted price Closing price Closing price Net asset value	Total 186,805 $ 84,319 7,287 5,647,963
			5,926,374 $
			1,829 $
			Total
			309,808 $ 40,237 4,384,300
			4,734,345 $
			Total
			225,078 $ 79,898 3,484,195
			3,789,171 $
		Net asset value

i. The instruments the Group used market quoted prices as their fair values (that is, Level 1) are listed below by characteristics:

~73~

ii. Except for financial instruments with active markets, the fair value of other financial instruments is measured by using valuation techniques or by reference to counterparty quotes. The fair value of financial instruments measured by using valuation techniques can be referred to current fair value of instruments with similar terms and characteristics in substance, discounted cash flow method or other valuation methods, including calculated by applying model using market information available at the consolidated balance sheet date.
iii. When assessing non-standard and low-complexity financial instruments, for example, debt instruments without active market and foreign exchange swap contracts, the Group adopts valuation technique that is widely used by market participants. The inputs used in the valuation method to measure these financial instruments are normally observable in the market.
iv. For high-complexity financial instruments, the fair value is measured by using selfdeveloped valuation model based on the valuation method and technique widely used within the same industry. The valuation model is normally applied to derivative financial instruments, debt instruments with embedded derivatives or securitised instruments. Certain inputs used in the valuation model are not observable at market, and the Group must make reasonable estimates based on its assumptions. The effect of unobservable inputs to the valuation of financial instruments is provided in Note 12(3)5.
v. The output of valuation model is an estimated value and the valuation technique may not be able to capture all relevant factors of the Group’s financial and non-financial instruments. Therefore, the estimated value derived using valuation model is adjusted accordingly with additional inputs, for example, model risk or liquidity risk and etc. In accordance with the Group’s management policies and relevant control procedures relating to the valuation models used for fair value measurement, management believes adjustment to valuation is necessary in order to reasonably represent the fair value of financial and non-financial instruments at the consolidated balance sheet. The inputs and pricing information used during valuation are carefully assessed and adjusted based on current market conditions.
(c) The following chart is the movement of Level 3 for the six months ended June 30,2021 and 2020:

2020:
			2021			2020
		Financial instruments			Financial instruments
At January 1	$		4,102,935	$		3,465,868
Loss recognised in profit or loss	(		46,659)	(		4,876)
Gain (loss) recognised in other comprehensive income			107,681	(		141,701)
Disposals	(		66,930)			-
Additions			155,124			7,216
Acquired from business combination			17,040			-
Transfers into level 3	(		21,084)			42,648
At June 30	$		4,248,107	$		3,369,155

D. Treasury department is in charge of valuation procedures for fair value measurements being categorised within Level 3, which is to verify independent fair value of financial instruments. Such assessment is to ensure the valuation results are reasonable by applying independent information to make results close to current market conditions, confirming the resource of information independent, reliable and in line with other resources and represented as the exercisable price, and frequently calibrating valuation model, performing back-testing, updating

~74~

inputs used to the valuation model and making any other necessary adjustments to the fair value.

E. The following is the qualitative information of significant unobservable inputs and sensitivity analysis of changes in significant unobservable inputs to valuation model used in Level 3 fair value measurement:

Unlisted shares Unlisted shares Unlisted shares Unlisted shares Unlisted shares De-an Venture Capital Co., Ltd. Non-derivative equity	Significant Fair value at Valuation unobservable June30,2021 technique input 2,615,111 $ Market comparable companies Price to book ratio multiple Discount for lack of marketability 32,898 Market comparable companies Enterprise value to operating income ratio multiple Discount for lack of marketability 234,035 Market comparable companies Price to earnings ratio multiple Discount for lack of marketability 1,181,486 Market comparable companies Enterprise value to EBITDA ratio multiple Discount for lack of marketability 165,072 Net asset value N/A 19,505 Net asset value N/A instrument:	Range Relationship of (weighted average) inputs to fairvalue 1.11~11.93 The higher the multiple, the higher the fair value. 20%~30% The higher the discount for lack of marketability, the lower the fair value. 1.01~3.06 The higher the multiple, the higher the fair value. 20%~30% The higher the discount for lack of marketability, the lower the fair value. 12.49~17.43 The higher the multiple, the higher the fair value. 20% The higher the discount for lack of marketability, the lower the fair value. 17.68~20.24 The higher the multiple, the higher the fair value. 30% The higher the discount for lack of marketability, the lower the fair value. - N/A - N/A	Relationship of inputs to fairvalue

~75~

Unlisted shares Unlisted shares Unlisted shares Unlisted shares De-an Venture Capital Co., Ltd. Non-derivative equity Unlisted shares Unlisted shares Unlisted shares De-an Venture Capital Co., Ltd. Non-derivative equity	Significant Fair value at Valuation unobservable December31,2020 technique input 3,085,933 $ Market comparable companies Price to book ratio multiple Discount for lack of marketability 13,002 Market comparable companies Enterprise value to operating income ratio multiple Discount for lack of marketability 239,906 Market comparable companies Price to earnings ratio multiple Discount for lack of marketability 744,094 Market comparable companies Enterprise value to EBIRDA ratio multiple Discount for lack of marketability 20,000 Net asset value N/A instrument: Significant Fair value at Valuation unobservable June30,2020 technique input 2,478,694 $ Market comparable companies Price to book ratio multiple Discount for lack of marketability 9,523 Market comparable companies Enterprise value to EBITDA ratio multiple Discount for lack of marketability 861,929 Market comparable companies Price to earnings ratio multiple Discount for lack of marketability 19,009 Net asset value N/A instrument:	Range Relationship of (weighted average) inputs to fairvalue 0.99~5.45 The higher the multiple, the higher the fair value. 20%~30% The higher the discount for lack of marketability, the lower the fair value. 3.06 The higher the multiple, the higher the fair value. 20% The higher the discount for lack of marketability, the lower the fair value. 14.61~21.77 The higher the multiple , the higher the fair value. 20% The higher the discount for lack of marketability, the lower the fair value. 18.19~19.46 The higher the multiple, the higher the fair value. 30% The higher the discount for lack of marketability, the lower the fair value. - N/A Range Relationship of (weighted average) inputs to fairvalue 0.79~3.76 The higher the multiple, the higher the fair value. 20%~30% The higher the discount for lack of marketability, the lower the fair value. 2.58 The higher the multiple, the higher the fair value. 20% The higher the discount for lack of marketability, the lower the fair value. 17.22~20.68 The higher the multiple the higher the fair value. 20% The higher the discount for lack of marketability, the lower the fair value. - N/A	Relationship of inputs to fairvalue

F. The Group has carefully assessed the valuation models and assumptions used to measure fair value. However, use of different valuation models or assumptions may result in different measurement. The following is the effect of profit or loss or of other comprehensive income from

~76~

financial assets and liabilities categorised within Level 3 if the inputs used to valuation models have changed:

have changed:
Financial assets Equity instrument Financial assets Equity instrument Financial assets Equity instrument	Input Multiple Input Multiple Input Multiple	Change ±1% Change ±1% Change ±1%	Favourable Unfavourable Favourable Unfavourable change change change change 657 $ 657) ($ 41,824 $ 41,824) ($ June 30,2021 Recognised in profit Recognised in other or loss comprehensive income Favourable Unfavourable Favourable Unfavourable change change change change 1,793 $ 1,793) ($ 39,237 $ 39,237) ($ December 31,2020 Recognised in profit Recognised in other or loss comprehensive income Favourable Unfavourable Favourable Unfavourable change change change change 1,529 $ 1,529) ($ 32,163 $ 32,163) ($ June 30, 2020 Recognised in profit Recognised in other or loss comprehensive income
			Favourable Unfavourable change change 1,529 $ 1,529) ($ Recognised in profit or loss

(4) For the six months ended June 30, 2021, the impact of COVID-19 on the Group’s business

operations.

Ever since the outbreak of COVID-19 in May in Taiwan, in addition to actively cooperating with the local governments’ epidemic precaution policies, the Group also holds higher standards in protecting its employees in order to prevent the production and sales of the Group from being severely affected by the pandemic. During the first half of the year, overall sales increased significantly compared to the same period last year due to the strong demand for LED backlight, automotive LED and sensors, as well as the mass production of Mini LED in the first half of the year. As a whole, the impact of COVID-19 on the operation of the Group is immaterial. The Group will continue to monitor the trend of the coronavirus COVID-19 pandemic and adjust its strategies in a timely manner.

13. SUPPLEMENTARY DISCLOSURES

(1) Significant transactions information

A. Loans to others: Please refer to table 1.
B. Provision of endorsements and guarantees to others: Please refer to table 2.
C. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures): Please refer to table 3.
D. Acquisition or sale of the same security with the accumulated cost exceeding NT $300 million or 20% paid-in capital or more: None.
E. Acquisition of real estate reaching NT$300 million or 20% of paid-in capital or more: None.
F. Disposal of real estate reaching NT$300 million or 20% of paid-in capital or more: None.
G. Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of paidin capital or more: Please refer to table 4.
H. Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more:

~77~

Please refer to table 5.

I. Trading in derivative instruments undertaken during the reporting periods: please refer to Notes 6(2) and 12(3).
J. Significant inter-company transactions during the reporting periods: Please refer to table 6.
(2) Information on investees

Names, locations and other information of investee companies (not including investees in Mainland China) ： Please refer to table 7.

(3) Information on investments in Mainland China

A. Basic information: Please refer to table 8.
B. Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area: Please refer to table 9.

(4) Major shareholders information

Major shareholders information: None.

14. SEGMENT INFORMATION

(1) General information:

The Group are engaged in the research and development, design, manufacturing and sales of EPI wafers and chips of A1GaInP, AlGaAs and InGaN and LED packages and modules. The Chief Operating Decision-Maker assesses performance by each operating result of each sub-group within the consolidated report.

(2) Segment information

The accounting policy of operating segments is provided in Note 4. The Chief Operating DecisionMaker assesses the performance of the operating segments based on the financial statements of operating segments. The measurement of profit is based on the income from continuing operations.

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

The segment information provided to the Chief Operating Decision-Maker for the reportable segments and reconciliations is as follows:

Six months ended June 30, 2021

Six months ended June 30, 2021
Revenues from external customers Segment income (loss) Segment assets	Epistar Group Lextar Group Others 11,343,252 $ 4,900,508 $ - $ 279,211 88,161 63,697) ( 58,065,136 14,057,717 1,833,209	Adjustments and Elimination - $ - 731,553) (	Consolidated
			16,243,760 $ 303,675 73,224,509

Six months ended June 30, 2020

Six months ended June 30, 2020
Revenues from external customers Segment income (loss) Segment assets	Epistar Group	Lextar Group - $ - -	Others - $ - -	Adjustments and Elimination Consolidated - $ 6,518,594 $ - 2,574,806) ( - 58,227,655	Consolidated
	6,518,594 $ 2,574,806) ( 58,227,655

~78~

ENNOSTAR INC. AND SUBSIDIARIES Loans to others SIX MONTHS ENDED JUNE 30, 2021

Table 1

Expressed in thousands of NTD (Except as otherwise indicated)

No.	Creditor	Borrower	General ledger account	Is a related party	Maximum outstanding balance during the six months ended 30-Jun-21	Balance at 30-Jun-21	Actual amount drawn down	Interest rate	Nature of loan	Amount of transactions with the borrower	Reason for short-term financing	Allowance for doubtful accounts	Collateral	Collateral	Limit on loans granted to a singleparty	Ceiling on total loansgranted	Footnote
													Item	Value
1 1 1 2 2 3 4 4 5 6	Epistar Corporation Epistar Corporation Epistar Corporation Epicrystal (Changzhou) Co., Ltd. Epicrystal (Changzhou) Co., Ltd. Yenrich Technology Corporation Lextar Electronics Corp. Lextar Electronics Corp. Lextar Electronics (Suzhou) Corp. LEXTAR (SINGAPORE)Pte Ltd.	Jiangsu Canyang Optoelectronics Ltd Unikorn Semiconductor Corporation ENNOSTAR Inc. LEADSTAR Micro-Crystal Display Corporation (JiangSu) Ltd. Jiangsu Canyang Optoelectronics Ltd iReach Corporation ENNOSTAR Inc. Yenrich Technology Corporation Lextar Electronics (Chuzhou) Corp Lextar Electronics (Chuzhou) Corp	Other receivables- related parties Other receivables- related parties Other receivables- related parties Other receivables- related parties Other receivables- related parties Other receivables- related parties Other receivables- related parties Other receivables- related parties Other receivables- related parties Other receivables- related parties	Y Y Y Y Y Y Y Y Y Y	438,400 $ 300,000 400,000 218,250 349,200 20,000 100,000 250,000 526,080 250,740	430,900 $ 300,000 400,000 215,450 344,720 20,000 100,000 250,000 517,080 250,740	129,270 $ 150,000 - - - - - 150,000 172,360 125,370	4.14% 1.56% 1.25% 4.35% 4.35% 1.56% 1.25% 1.05% 1%~ 4.45% 1.5%~ 2.25%	Short- term financing Short- term financing Short- term financing Short- term financing Short- term financing Short- term financing Short- term financing Short- term financing Short- term financing Short- term financing	- $ - - - - - - - - -	Working capital Working capital Working capital Working capital Working capital Working capital Working capital Working capital Working capital Working capital	- $ - - - - - - - - -	Promissory Note Promissory Note Promissory Note None None Promissory Note None Promissory Note None None	430,900 $ 300,000 400,000 - - 20,000 - 250,000 - -	3,727,731 $ 3,727,731 3,727,731 854,764 854,764 280,347 1,016,906 1,016,906 1,016,906 1,016,906	11,183,192 $ 11,183,192 11,183,192 1,282,147 1,282,147 280,347 4,067,623 4,067,623 2,641,875 1,906,429	Note 1 Note 1 Note 1 Note 2 Note 2 Note 3 Note 4 Note 4 Note 5 Note 6

Table 1-1

Note 1: In accordance with Epistar Corporation’s Procedures for Provision of Loans: the limit on loans granted to a single party is 10% of its net equity, and the ceiling on total loans granted is 30% of its net equity.

Note 2: In accordance with Epicrystal (Changzhou) Co., Ltd. Procedures for Provision of Loans: the limit on loans granted to a single party is 20% of its net equity, and the ceiling on total loans granted is 30% of its net equity. Note 3: In accordance with Yenrich Technology Corporation Procedures for Provision of Loans: the limit on loans granted to a single party is 40% of its net equity, and the ceiling on total loans granted is 40% of its net equity. Note 4: In accordance with Lextar Electronics Corp. Procedures for Provision of Loans: the limit on loans granted to a single party is 10% of its net equity, and the ceiling on total loans granted is 40% of its net equity.The total amount for fund-lending between the subsidiaries whose voting shares are 100% owned, directly and indirectly, by the Company will not be subject to the limit of 40% of the net worth of the lending subsidiary. However, these subsidiaries shall still prescribe limits on the aggregate amount of such loans and on the amount of such loans permitted to a single borrower, and shall specify limits on the durations of such loans.
Note 5: In accordance with Lextar Electronics (SuZhou) Co., Ltd.’s Procedures for Provision of Loans: the ceiling on total loans granted is 80% of its net equity and 40% of the net equity of Lextar Electronics Corp., and the limit on loans granted to a single party is 80% of its net equity and 10% of the net equity of Lextar Electronics Corp.
Note 6: In accordance with Lextar (Singapore) Pte. Ltd.’s Procedures for Provision of Loans: the ceiling on total loans granted is 80% of its net equity and 40% of the net equity of Lextar Electronics Corp., and the limit on loans granted to a single party is 80% of its net equity and 10% of the net equity of Lextar Electronics Corp.

Table 1-1

ENNOSTAR INC. AND SUBSIDIARIES Provision of endorsements and guarantees to others SIX MONTHS ENDED June 30, 2021

Table 2

Expressed in thousands of NTD (Except as otherwise indicated)

Party being endorsed/guaranteed

Number `（`Note 1`）`	Endorser/ guarantor	Companyname	Relationship with the endorser/ guarantor (Note 2)	Limit on endorsements/ guarantees provided for a single party (Note3)	Maximum outstanding endorsement/ guarantee amount as of June30,2021	Outstanding endorsement/ guarantee amount at June30,2021	Actual amount drawn down	Amount of endorsements/ guarantees secured with collateral	Ratio of accumulated endorsement/ guarantee amount to net asset value of the endorser/ guarantor company	Ceiling on total amount of endorsements/ guarantees provided `(`Note3)	Provision of endorsements/ guarantees by parent company to subsidiary	Provision of endorsements/ guarantees by subsidiary to parent company	Provision of endorsements/ guarantees to the party in Mainland China	Footnote
1 1 1 1 2	Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Episky Corporation (Xiamen) Ltd.	Episky Corporation (Xiamen) Ltd. Jiangsu Canyang Optoelectronics Ltd Unikorn Semiconductor Corporation Yenrich Technology Corporation. SHENZHEN EPIKYLIN OPTOELECTRONI CS CO.,LTD	2 2 2 2 2	3,727,731 $ 3,727,731 3,727,731 3,727,731 514,540	1,540,890 $ 513,630 1,620,955 142,675 434,500	1,504,440 $ 501,480 1,612,180 139,300 430,900	303,477 $ - 592,292 - -	- $ - - - -	4.04 1.35 4.32 0.37 20.94	7,455,461 $ 7,455,461 7,455,461 7,455,461 823,265	N N N N N	N N N N N	Y Y N N Y

Note 1: The numbers filled in for the endorsements/guarantees provided by the Company or subsidiaries are as follows:

(1) The Company is ‘0’.
(2) The subsidiaries are numbered in order starting from ‘1’.

Note 2: Relationship between the endorser/guarantor and the party being endorsed/guaranteed is classified into the following six categories; fill in the number of category each case belongs to:

(1) Having business relationship.
(2) The endorser/guarantor parent company owns directly or indirectly more than 50% voting shares of the endorsed/guaranteed subsidiary.
(3) The endorser/guarantor parent company and its subsidiaries jointly own directly or indirectly more than 50% voting shares of the endorsed/guaranteed company.
(4) The endorsed/guaranteed parent company directly or indirectly owns more than 90% voting shares of the endorser/guarantor subsidiary.
(5) Mutual guarantee of the trade as required by the construction contract.
(6) Due to joint venture, each shareholder provides endorsements/guarantees to the endorsed/guaranteed company in proportion to its ownership.
(7) Companies in the same industry provide among themselves joint and several security for a performance guarantee of a sales contract for pre-construction homes pursuant to the Consumer Protection Act for each other.

Note3: (1)In accordance with the Epistar’s Procedures for Provision of endorsements and guarantees to others: the ceiling on total endorsements/guarantees is 20% of the Company’s net assets, and the limit on endorsements/guarantees to a single party is 10% of its net assets.

(2)In accordance with the Episky (Xiamen) ’s Procedures for Provision of endorsements and guarantees to others: the ceiling on total endorsements/guarantees is 40% of the Company’s net assets, and the limit on endorsements/guarantees to a single party is 25% of its net assets.

Table 2-1

Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures) June 30, 2021

Table 3

Expressed in thousands of NTD (Except as otherwise indicated)

ENNOSTAR INC. AND SUBSIDIARIES

Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account		As of June 30,	2021		Footnote
				Number of shares	Bookvalue	Ownership (%)	Fairvalue
ENNOSTAR Inc. Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation	Tyntek Corporation.(Stock) E&E Japan Co.Ltd. (Stock) NATEC CORPORATION (Stock) Esleds Co.,Ltd. (Stock) Lynk Labs,Inc. (Stock) Advanced Photoelectronic Technology Limited (Stock) Chi Lin Optoelectronics Co., Ltd. (Stock)	None None None None None None None	Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current financial assets at fair value through profit or loss	8,935,000 140 120,000 1,000 92,523 1,339,235 2,868,402	225,609 $ 2,143 1,748 148 56,961 167,361 65,686	2.97 17.07 7.50 10.00 7.39 12.24 12.57	225,609 $ 2,143 1,748 148 56,961 167,361 65,686

Table 3-1

As of June 30, 2021

					As of June 30,	2021
Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account	Number of shares	Bookvalue	Ownership (%)	Fairvalue	Footnote
Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistat Corporation	Dominant Opto Technologies Sdn. Bhd. (Stock) Crystalwise Technology Inc. (Stock) XENIO CORPORATION (stock) Edison Opto Corp. (Stock) PlayNitride Inc. (Stock) OSTENDO TECHNOLOGIES,INC. (Stock) Nan Ya Photonics Incorporation (Stock) Tekcore co., Ltd. (Stock)	None None None None None None None None	Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current financial assets at fair value through profit or loss Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current financial assets at fair value through profit or loss Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income	11,000,000 2,664,355 7,878 9,068,000 4,568,669 67,500 9,173,000 8,270,522	1,181,486 $ 57,550 - 187,708 311,681 - 234,035 192,892	10.00 3.06 0.06 7.40 10.09 4.50 19.90 19.11	1,181,486 $ 57,550 - 187,708 311,681 - 234,035 192,892

Table 3-2

As of June 30, 2021

					As of June 30,	2021
Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account	Number of shares	Bookvalue	Ownership (%)	Fairvalue	Footnote
Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar JV Holding (BVI) Co.,Ltd. Epistar JV Holding (BVI) Co.,Ltd. Episky Corp.(Xiamen) Ltd.	Phecda Technology Co., Ltd. (Stock) Elit Fine Ceramics Co., Ltd. (Stock) Nanocrystal Technology Inc. (Stock) Tyntek Corporation.(Stock) ENNOSTAR Inc. (Stock) Everlight electronic (Fujian) Co., Ltd. (Stock) KAISTAR Lighting (Xiamen) Co., Ltd. (Stock) China Firstar Optoelectronic Materials Co., Ltd. (Stock)	None None None None Parent company None None None	Non-current investments in equity instruments at fair value through other comprehensive income Non-current financial assets at fair value through profit or loss Non-current financial assets at fair value through profit or loss Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income	600,000 2,200,000 6,000,000 10,218,000 5,743,500 cash USD2,500,000 cash USD48,000,000 cash RMB7,500,000	- $ - - 258,005 450,865 60,860 1,599,277 21,943	2.11 4.68 11.11 3.40 0.84 10.00 17.65 15.00	- $ - - 258,005 450,865 60,860 1,599,277 Not listed. No market value available.	Note 1

Table 3-3

As of June 30, 2021

					As of June 30,	2021
Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account	Number of shares	Bookvalue	Ownership (%)	Fairvalue	Footnote
Episky Corp.(Xiamen) Ltd. Episky Corp.(Xiamen) Ltd. Lighting Investment Corp. Lighting Investment Corp. Lighting Investment Corp. Lighting Investment Corp. Lighting Investment Corp. Lighting Investment Corp.	APT Electronics Co., Ltd.(Stock) China Crystal Technologies Co.,Ltd.(Stock) Oree Advanced Illumination Solutions, Inc. (Stock) Lustrous Technology, Ltd. (Stock) TERA XTAL TECHNOLOGY CORPORATION (Stock) XENIO CORPORATION (Stock) FormoLight Technologies Inc. (Stock) Advanced Photoelectronic Technology Limited (Stock)	None None None None None None None None	Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current financial assets at fair value through profit or loss Non-current financial assets at fair value through profit or loss Non-current financial assets at fair value through profit or loss Non-current financial assets at fair value through profit or loss Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income	4,678,240 8,064,516 79,407 266,892 795,000 16,462 2,038,230 562,018	46,745 $ 16,714 - - - - 13,242 70,234	1.14 4.08 5.00 8.99 0.42 0.13 10.00 5.14	Not listed. No market value available. Not listed. No market value available. - - - - 13,242 70,234

Table 3-4

As of June 30, 2021

					As of June 30,	2021
Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account	Number of shares	Bookvalue	Ownership (%)	Fairvalue	Footnote
Lighting Investment Corp. Lighting Investment Corp. Lighting Investment Corp. Lighting Investment Corp. Lighting InvestmentCorp. Lighting InvestmentCorp. Lighting Investment Corp. Lighting Investment Corp.	Edison Opto Corp. (Stock) Rigidtech Microelectronics Cops. (Stock) Le Dimond Opto Corporation (Stock) LEDLITEK Co., Ltd. (Stock) De-an Venture Capoital Co., Ltd. (Stock) iReach Corporation (Stock) Tyntek corporation.(Stock) Edison Opto Corp. (Stock)	None None None None None Investee company accounted for under the equity method of Epistar None None	Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Current financial assets at fair value through profit or loss	10,705,000 1,550,253 1,100,000 50,000 2,000,000 370,000 10,000 5,851,182	221,593 $ 13,611 9,053 5,436 19,505 1,891 253 121,119	8.73 2.17 16.92 6.20 10.77 4.11 - 4.77	221,593 $ 13,611 9,053 5,436 19,505 1,891 253 121,119

Table 3-5

As of June 30, 2021

					As of June 30,	2021
Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account	Number of shares	Bookvalue	Ownership (%)	Fairvalue	Footnote
Lighting Investment Corp. Lighting Investment Corp. Lighting Investment Ltd. Lighting Investment Ltd. Lighting Investment Ltd. Lighting Investment Ltd. Lighting Investment Ltd. Full Star Enterprises Limited	ENNOSTAR Inc. (Stock) Taishin 1699 Money Market Fund (Beneficiary certificates) LEDLITEK Co., Ltd. (Stock) Verticle Inc. (Stock) Achrolux Inc. (Stock) PlayNitride Inc. (Stock) Advanced Photoelectronic Technology Limited (Stock) PlayNitride Inc. (Stock)	Parent company None None None None None None None	Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Non-current investments in equity instruments at fair value through other comprehensive income Non-current financial assets at fair value through profit or loss Non-current financial assets at fair value through profit or loss Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income	1,282,377 3,974,358 41,500 582,983 987,500 778,541 200,000 600,000	100,667 $ 54,304 4,512 - - 53,113 24,994 40,933	0.19 $ N/A 5.15 3.00 6.91 1.72 1.83 1.33	100,667 $ 54,304 4,512 - - 53,113 24,994 40,933	Note1

Table 3-6

As of June 30, 2021

					As of June 30,	2021
Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account	Number of shares	Bookvalue	Ownership (%)	Fairvalue	Footnote
HUGA Holding (SAMOA) Ltd. HUGA Holding (SAMOA) Ltd. GaNrich Semiconductor Corporation Amengine Corporation Lextar Electronics Corp. Lextar Electronics Corp. Lextar Electronics Corp. Wellybond Corporation	China Crystal Technologies Co.,Ltd.(Stock) OEPIC SEMICONDUCTORS,INC.(Stock) Franklin Templeton Sinoam Money Market Fund (beneficiary certificates) Franklin Templeton Sinoam Money Market Fund (beneficiary certificates) Jhong Wei Corporation(Stock) China Electric Mfg.Corp.(Stock) Tyntek corporation.(Stock) China Electric Mfg.Corp.(Stock)	None None None None None None None None	Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income	17,741,935 377,358 1,916,278 958,111 106,000 5,265,000 9,423,000 1,862,640	36,772 $ 5,178 20,010 10,005 - 61,863 237,931 21,886	8.97 8.93 N/A N/A - 1.63 3.13 0.58	36,772 $ 5,178 20,010 10,005 - 61,863 237,931 21,886	Note 2

Table 3-7

As of June 30, 2021

					As of June 30,	2021
Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account	Number of shares	Bookvalue	Ownership (%)	Fairvalue	Footnote
Wellybond Corporation Tyntek corporation.(Stock) Wellybond Corporation Wellysun Inc.(Stock) Lextar Electronics (Suzhou) Co., Ltd. Suzhou Hanhua Semiconductor Co., Ltd(Stock) Note 1: Transferred from the Epistar’s stocks held as treasury stocks. Note 2: The company registrations had been canceled.		None Wellybond is a director of WELLYSUN INC. None	Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income Non-current investments in equity instruments at fair value through other comprehensive income	10,000 2,400,000 -	253 $ 27,720 155,124	- 7.84 -	253 $ 27,720 155,124

Table 3-8

Table 4

ENNOSTAR INC. AND SUBSIDIARIES

Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of paid-in capital or more

Six months ended June 30, 2021

Expressed in thousands of NTD (Except as otherwise indicated)

Purchaser/seller	Counterparty	Relationship with the counterparty			Transaction		Differences in transaction terms	Differences in transaction terms	Notes/accounts receivable (payable)	Notes/accounts receivable (payable)
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unitprice	Credit term	Balance	Percentage of total notes/accounts receivable (payable)
Yenrich Technology Corporation Yenrich Technology Corporation Yenrich Technology Corporation Episky Corp.(Xiamen) Ltd. Episky Corp.(Xiamen) Ltd. Epistar Corporation Epistar corporation	LEDAZ Co., Ltd LEADSTAR Micro-Crystal Display Corporation (JiangSu) Ltd. Epistar corporation SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 2	Sales Sales Purchases Sales Sales Sales Sales	($ 134,810) ( 161,957) 202,926 ( 1,170,995) ( 152,437) ( 222,279) ( 139,276)	( 30) ( 36) 52 ( 51) ( 7) ( 2) ( 2)	90 days after month- end closing 60 days after month- end closing 120 days after month- end closing 90 days after month- end closing	Normal Normal Normal Normal Normal Normal Normal	Normal Normal Normal Normal Normal Normal Normal	$ 99,299 44,474 ( 169,714) 882,888 61,959 217,721 -	35 16 ( 58) 44 3 2 -
	Epistar corporation					60 days after next month-end closing
	LEDAZ Co., Ltd CreeLED Hong Kong Ltd.					90 days after month- end closing 90 days after month- end closing

Table 4-1

Purchaser/seller	Counterparty	Relationship with the counterparty			Transaction		Differences in transaction terms	Differences in transaction terms	Notes/accounts receivable (payable)	Notes/accounts receivable (payable)	Footnote
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unitprice	Credit term	Balance	Percentage of total notes/accounts receivable (payable)
Epistar corporation Epistar corporation Epistar corporation Epistar corporation Epistar corporation Epistar corporation Epicrystal (Changzhou) Co., Ltd.	Jiangsu Canyang Optoelectronics Ltd. LEADSTAR Micro-Crystal Display Corporation (JiangSu) Ltd. SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD Episky Corp.(Xiamen) Ltd. Epicrystal (Changzhou) Co., Ltd. Yenrich Technology Corporation Jiangsu Canyang Optoelectronics Ltd.	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	Sales Sales Sales Sales Sales Sales Sales	($ 164,790) ( 131,336) ( 467,029) ( 476,030) ( 236,997) ( 202,926) ( 239,873)	( 2) ( 1) ( 5) ( 5) ( 3) ( 2) ( 15)	180 days after month- end closing 60 days after month- end closing 180 days after month- end closing 180 days after next month-end closing 90 days after month- end closing 120 days after month- end closing 90 days after month- end closing	Normal Normal Normal Normal Normal Normal Normal	Normal Normal Normal Normal Normal Normal Normal	$ 208,429 73,078 461,861 471,308 116,794 169,714 164,398	2 1 5 5 1 2 7

Table 4-2

Purchaser/seller	Counterparty	Relationship with the counterparty			Transaction		Differences in transaction terms	Differences in transaction terms	Notes/accounts receivable (payable)	Notes/accounts receivable (payable)
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unitprice	Credit term	Balance	Percentage of total notes/accounts receivable (payable)
Epicrystal (Changzhou) Co., Ltd. Epicrystal (Changzhou) Co., Ltd. Jiangsu Canyang Optoelectronics Ltd. Jiangsu Canyang Optoelectronics Ltd. Jiangsu Canyang Optoelectronics Ltd. Prolight Opto Technology Corporation LEADSTAR Micro- Crystal Display Corporation (JiangSu) Ltd. LEADSTAR Micro- Crystal Display Corporation (JiangSu) Ltd.	Epistar corporation Episky Corp.(Xiamen) Ltd. Epistar corporation Episky Corp.(Xiamen) Ltd. Epicrystal (Changzhou) Co., Ltd. Shanghai Welight Electronic Co., LTD Leyard TV Technology Co., Ltd. LEYARD EUROPE s.r.o.	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Other related parties Other related parties	Sales Sales Sales Sales Sales Sales Sales Sales	($ 856,118) ( 673,015) ( 573,435) ( 498,486) ( 164,052) ( 108,836) ( 253,392) ( 133,955)	( 53) ( 42) ( 47) ( 41) ( 14) ( 23) ( 64) ( 34)	150 days after month- end closing 90 days after month- end closing 90 days after month- end closing 90 days after month- end closing	Normal Normal Normal Normal Normal Normal Normal Normal	Normal Normal Normal Normal Normal Normal Normal Normal	$ 764,948 933,176 103,014 420,214 111,911 119,004 36,022 75,132	32 39 12 48 13 42 31 65

						90 days after next month-end closing
						120 days after month- end closing 30% after signing the contract, 30%: 7 days after shipment, 40%: 7 days after acceptance 30%: Prepayments before shipment, 70%: 60 days after shipment

Table 4-3

Purchaser/seller	Counterparty	Relationship with the counterparty			Transaction		Differences in transaction terms	Differences in transaction terms	Notes/accounts receivable (payable)	Notes/accounts receivable (payable)	Footnote
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unitprice	Credit term	Balance	Percentage of total notes/accounts receivable (payable)
Episky Corp.(Xiamen) Ltd. Episky Corp.(Xiamen) Ltd. Episky Corp.(Xiamen) Ltd. Epistar corporation Epistar corporation Epistar corporation Epicrystal (Changzhou) Co., Ltd Epicrystal (Changzhou) Co., Ltd Jiangsu Canyang Optoelectronics Ltd.	Jiangsu Canyang Optoelectronics Ltd. Epistar corporation Epicrystal (Changzhou) Co., Ltd. Jiangsu Canyang Optoelectronics Ltd. Episky Corp.(Xiamen) Ltd. Epicrystal (Changzhou) Co., Ltd. Jiangsu Canyang Optoelectronics Ltd. Epistar corporation Epistar corporation	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	Purchases Purchases Purchases Purchases Purchases Purchases Purchases Purchases Purchases	$ 498,486 476,030 673,015 573,435 152,437 856,118 164,052 236,997 164,790	25 24 33 11 3 16 14 20 16	90 days after month- end closing 180 days after next month-end closing 90 days after month- end closing 90 days after month- end closing 60 days after next month-end closing 150 days after month- end closing 90 days after month- end closing 90 days after month- end closing 180 days after month- end closing	Normal Normal Normal Normal Normal Normal Normal Normal Normal	Normal Normal Normal Normal Normal Normal Normal Normal Normal	($ 420,214) ( 471,308) ( 933,176) ( 103,014) ( 61,959) ( 764,948) ( 111,911) ( 116,794) ( 208,429)	( 23) ( 26) ( 52) ( 4) ( 2) ( 29) ( 25) ( 26) ( 47)

Table 4-4

Purchaser/seller	Counterparty	Relationship with the counterparty			Transaction		Differences in transaction terms	Differences in transaction terms	Notes/accounts receivable (payable)	Notes/accounts receivable (payable)	Footnote
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unitprice	Credit term	Balance	Percentage of total notes/accounts receivable (payable)
Shanghai Welight Electronic Co., LTD LEADSTAR Micro- Crystal Display Corporation (JiangSu) Ltd. LEADSTAR Micro- Crystal Display Corporation (JiangSu) Ltd. SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD Jiangsu Canyang Optoelectronics Ltd. Lextar Electronics Corp. Lextar Electronics Corp.	Prolight Opto Technology Corporation Yenrich Technology Corporation Epistar corporation Epistar corporation Episky Corp.(Xiamen) Ltd. Epicrystal (Changzhou) Co., Ltd. CreeLED Hong Kong Ltd. Fortech Electronics (Suzhou) Co., Ltd.	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 2 Other related parties	Purchases Purchases Purchases Purchases Purchases Purchases Sales Sales	$ 108,836 161,957 131,336 467,029 1,170,995 239,873 ( 173,532) ( 131,906)	99 41 33 28 71 24 ( 5) ( 4)	120 days after month- end closing 60 days after month- end closing 60 days after month- end closing 180 days after month- end closing 90 days after month- end closing 90 days after month- end closing OA 45 days 120 days after month- end closing	Normal Normal Normal Normal Normal Normal Normal Normal	Normal Normal Normal Normal Normal Normal Normal Normal	($ 119,004) ( 44,474) ( 73,078) ( 461,861) ( 882,888) ( 164,398) - 102,978	( 100) ( 21) ( 34) ( 32) ( 60) ( 37) - 5

Table 4-5

Purchaser/seller	Counterparty	Relationship with the counterparty			Transaction		Differences in transaction terms	Differences in transaction terms	Notes/accounts receivable (payable)	Notes/accounts receivable (payable)	Footnote
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unitprice	Credit term	Balance	Percentage of total notes/accounts receivable (payable)
Lextar Electronics (Suzhou) Co., Ltd. Lextar Electronics (Chuzhou) Corp Lextar Electronics (Chuzhou) Corp Lextar Electronics Corp. Lextar Electronics Corp. Lextar Electronics (Suzhou) Co., Ltd. Lextar Electronics (Chuzhou) Corp	Lextar Electronics Corp. Lextar Electronics Corp. Lextar Electronics (Suzhou) Co., Ltd. Lextar Electronics (Suzhou) Co., Ltd. Lextar Electronics (Chuzhou) Corp Lextar Electronics (Chuzhou) Corp Chuzhou Bwin Technology Corp.	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	Sales Sales Sales Purchases Purchases Purchases Purchases	($ 110,925) ( 2,153,843) ( 436,613) 110,925 2,153,843 436,613 113,932	( 21) ( 59) ( 12) 3 68 90 4	OA 90 days~OA 120 days OA 90 days~OA 120 days OA 90 days~OA 120 days OA 90 days~OA 120 days OA 90 days~OA 120 days OA 90 days~OA 120 days OA 60 days~OA 120 days	Normal Normal Normal Normal Normal Normal Normal	Normal Normal Normal Normal Normal Normal Normal	$ 94,012 1,280,934 416,259 ( 94,012) ( 1,280,934) ( 416,259) ( 42,225)	21 56 18 ( 5) ( 68) ( 91) ( 2)

Note 1: Investee company accounted for under the equity method directly and indirectly. Note 2: It is no longer the company’s other related party beginning on April, 2021.

Table 4-6

ENNOSTAR INC. AND SUBSIDIARIES

Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more

June 30, 2021

			June 30, 2021	June 30, 2021
Table 5 Creditor	Counterparty	Relationship with the counterparty	Balance as at June 30,2021		Total	Turnover rate	Overdue receivables		Amount collected subsequent to the balance sheet date Allowance for doubtful debts Expressed in thousands of NTD (Except as otherwise indicated)
			Accounts receivable	Other receivable			Amount	Action taken
Episky Corporation (Xiamen) Ltd. Epistar corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epicrystal (Changzhou) Co., Ltd. Epicrystal (Changzhou) Co., Ltd.	SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD LEDAZ Co., Ltd Jiangsu Canyang Optoelectronics Ltd. SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD Episky Corp.(Xiamen) Ltd. Unikorn Semiconductor Corporation Epicrystal (Changzhou) Co., Ltd. Yenrich Technology Corporation Jiangsu Canyang Optoelectronics Ltd. Epistar corporation	Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2	$ 882,888 217,721 208,429 461,861 471,308 5,142 116,794 169,714 164,398 764,948	$ - - 234,453 589 18,523 391,620 28,909 86,613 3,305 -	$ 882,888 217,721 442,882 462,450 489,831 396,762 145,703 256,327 167,703 764,948	4.85 2.56 0.65 4.04 2.16 0.13 2.88 1.61 3.01 2.86	$ 168,500 57,518 121,328 1 17,570 - 11,140 - 2,378 -	Note 1 - Note 1 Note 1 - - Note 1 - - -	220,217 - 35,994 71,905 69,740 - 34,311 - - -	$ - 42,840 - - - - - - - -

Table 5-1

Creditor	Counterparty	Relationship with the counterparty	Balance as at June 30,2021	Balance as at June 30,2021	Total	Turnover rate	Overdue receivables	Overdue receivables	Amount collected subsequent to the balance sheet date	Allowance for doubtful debts
			Accounts receivable	Other receivable			Amount	Action taken
Epicrystal (Changzhou) Co., Ltd. Jiangsu Canyang Optoelectronics Ltd. Jiangsu Canyang Optoelectronics Ltd. Jiangsu Canyang Optoelectronics Ltd. Luxlite (Shenzhen) Corporation Limited Prolight Opto Technology Corporation Lextar Electronics Corp. Lextar Electronics Corp. Lextar Electronics (Chuzhou) Corp Lextar Electronics (Chuzhou) Corp	Episky Corp.(Xiamen) Ltd. Epistar corporation Episky Corp.(Xiamen) Ltd. Epicrystal (Changzhou) Co., Ltd. SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD Shanghai Welight Electronic Co., LTD Lextar Electronics (Chuzhou) Corp Fortech Electronics (Suzhou) Co., Ltd. Lextar Electronics Corp. Lextar Electronics (Suzhou) Co., Ltd.	Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Other related parties Note 2 Note 2	$ 933,176 103,014 420,214 111,911 115,627 119,004 486,121 102,978 1,280,934 416,259	$ - - - - - - - - - -	$ 933,176 103,014 420,214 111,911 115,627 119,004 486,121 102,978 1,280,934 416,259	1.41 10.40 2.85 4.15 0.05 2.00 3.90 2.57 3.45 1.95	434,858 - - - 112,860 - - - 70,809 155,977	- - - - - - - - Note 1 Note 1	- 103,014 - - - - 104,443 15,929 424,990 15,539	$ - - - - - - - - - -

Note 1: The Company endeavored to collect the overdue amount. Epistar has received $3,116, $1 and $475 from Jiangsu Canyang, SHENZHEN EPIKYLIN, and Epicrystal (Changzhou) respectively ;and Episky(Xiamen) has received $168,500, from SHENZHEN EPIKYLIN; Lextar(Chuzhou) has received $70,809 and $15,539 from Lextar and Lextar(Suzhou).

Note 2: Investee company accounted for under the equity method directly and indirectly.

Table 5-2

Table 6

ENNOSTAR INC.AND SUBSIDIARIES

Significant inter-company transactions during the reporting periods

Six months ended June 30, 2021

Expressed in thousands of NTD (Except as otherwise indicated)

Transaction

Number (Note 1)	Companyname	Counterparty	Relationship (Note 2)	General ledgeraccount	Amount	Transactionterms	Percentage of consolidated total operating revenues or total assets(Note 3)
0 0 0 1 1 1 1 1	ENNOSTAR Inc. ENNOSTAR Inc. ENNOSTAR Inc. Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation	Epistar Corporation Lextar Electronics Corp. Epistar Corporation Jiangsu Canyang Optoelectronics Ltd. LEADSTAR Micro-Crystal Display Corporation (JiangSu) Ltd. SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD Episky Corp.(Xiamen) Ltd. Epicrystal (Changzhou) Co., Ltd.	`1` `1` 1 3 3 3 3 3	Other receivable Other receivable Dividend Sales Sales Sales Sales Sales	$ 1,190,000 310,000 250,000 164,790 131,336 467,029 476,030 236,997	Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties	1.63 0.42 1.54 1.01 0.81 2.88 2.93 1.46

Table 6-1

Transaction

Number (Note 1)	Companyname	Counterparty	Relationship (Note 2)	General ledgeraccount	Amount	Transactionterms	Percentage of consolidated total operating revenues or total assets(Note 3)
1 1 1 1 1 1 1 1 1	Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation	Yenrich Technology Corporation Jiangsu Canyang Optoelectronics Ltd. Episky Corp.(Xiamen) Ltd. Epicrystal (Changzhou) Co., Ltd. Jiangsu Canyang Optoelectronics Ltd. SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD Episky Corp.(Xiamen) Ltd. Epicrystal (Changzhou) Co., Ltd. Yenrich Technology Corporation	3 3 3 3 3 3 3 3 3	Sales Cost of goods sold Cost of goods sold Cost of goods sold Accounts receivable Accounts receivable Accounts receivable Accounts receivable Accounts receivable	$ 202,926 573,435 152,437 856,118 208,429 461,861 471,308 116,794 169,714	Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties	1.25 3.53 0.94 5.27 0.28 0.63 0.64 0.16 0.23

Table 6-2

Transaction

Number (Note 1)	Companyname	Counterparty	Relationship (Note 2)	General ledgeraccount	Amount	Transactionterms	Percentage of consolidated total operating revenues or total assets(Note 3)
1 1 1 1 2 3 3 4 4	Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Yenrich Technology Corporation Episky Corp.(Xiamen) Ltd. Episky Corp.(Xiamen) Ltd. Epicrystal (Changzhou) Co., Ltd. Epicrystal (Changzhou) Co., Ltd.	Jiangsu Canyang Optoelectronics Ltd. Epicrystal (Changzhou) Co., Ltd. Jiangsu Canyang Optoelectronics Ltd. Unikorn Semiconductor Corporation LEADSTAR Micro-Crystal Display Corporation (JiangSu) Ltd. SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD Jiangsu Canyang Optoelectronics Ltd. Episky Corp.(Xiamen) Ltd.	3 3 3 3 3 3 3 3 3	Accounts payable Accounts payable Other receivable Other receivable Sales Sales Accounts receivable Sales Sales	$ 103,014 764,948 234,453 391,620 161,957 1,170,995 882,888 239,873 673,015	Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Based on contract terms Based on contract terms Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties	0.14 1.04 0.32 0.53 1.00 7.21 1.21 1.48 4.14

Table 6-3

Transaction

Number (Note 1)	Companyname	Counterparty	Relationship (Note 2)	General ledgeraccount	Amount	Transactionterms	Percentage of consolidated total operating revenues or total assets(Note 3)
4 4 5 5 5 5 5 5 6	Epicrystal (Changzhou) Co., Ltd. Epicrystal (Changzhou) Co., Ltd. Jiangsu Canyang Optoelectronics Ltd. Jiangsu Canyang Optoelectronics Ltd. Jiangsu Canyang Optoelectronics Ltd. Jiangsu Canyang Optoelectronics Ltd. Jiangsu Canyang Optoelectronics Ltd. Jiangsu Canyang Optoelectronics Ltd. Prolight Opto Technology Corporation	Jiangsu Canyang Optoelectronics Ltd. Episky Corp.(Xiamen) Ltd. Episky Corp.(Xiamen) Ltd. Epicrystal (Changzhou) Co., Ltd. Episky Corp.(Xiamen) Ltd. Epicrystal (Changzhou) Co., Ltd. Epicrystal (Changzhou) Co., Ltd. Epicrystal (Changzhou) Co., Ltd. Shanghai Welight Electronic Co., LTD	3 3 3 3 3 3 3 3 3	Accounts receivable Accounts receivable Sales Sales Accounts receivable Accounts receivable Other payable Processing fee Sales	$ 164,398 933,176 498,486 164,052 420,214 111,911 120,750 151,966 108,836	Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties	0.22 1.27 3.07 1.01 0.57 0.15 0.16 0.94 0.67

Table 6-4

Transaction

Number (Note 1)	Companyname	Counterparty	Relationship (Note 2)	General ledgeraccount	Amount	Transactionterms	Percentage of consolidated total operating revenues or total assets(Note 3)
6 7 8 8 8 8 9 9 9	Prolight Opto Technology Corporation Luxlite (Shenzhen) Corporation Limited Lextar Electronics Corp. Lextar Electronics Corp. Lextar Electronics Corp. Lextar Electronics Corp. Lextar Electronics (Suzhou) Co., Ltd. Lextar Electronics (Suzhou) Co., Ltd. Lextar Electronics (Suzhou) Co., Ltd.	Shanghai Welight Electronic Co., LTD SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD Lextar Electronics (Suzhou) Co., Ltd. Lextar Electronics (Chuzhou) Corp Lextar Electronics (Chuzhou) Corp Yenrich Technology Corporation Lextar Electronics (Chuzhou) Corp Lextar Electronics (Chuzhou) Corp Lextar Electronics (Chuzhou) Corp	3 3 3 3 3 3 3 3 3	Accounts receivable Accounts receivable Purchases Purchases Accounts payable Other receivable Purchases Accounts payable Other receivable	$ 119,004 115,627 110,925 2,153,843 1,280,934 150,000 436,613 416,259 172,360	Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Loans granted Conducted in the ordinary course of business with terms similar to those with third parties Conducted in the ordinary course of business with terms similar to those with third parties Loans granted	0.16 0.16 0.68 13.26 1.75 0.20 2.69 0.57 0.24

Table 6-5

Transaction

Number (Note 1)	Companyname	Counterparty	Relationship (Note 2)	General ledgeraccount	Amount	Transactionterms	Percentage of consolidated total operating revenues or total assets(Note 3)
10 11	Lextar Electronics (Chuzhou) Corp Lextar (Singapore) Pte. Ltd.	Lextar Electronics Corp. Lextar Electronics (Chuzhou) Corp	3 3	Accounts payable Other receivable	$ 486,121 125,370	Conducted in the ordinary course of business with terms similar to those with third parties Loans granted	0.66 0.17

Note 1: Parent company is ‘0’.The subsidiaries are numbered in order starting from ‘1’.

Note 2: Relationship between transaction company and counterparty is classified into the following three categories; fill in the number of category each case belongs to (If transactions between parent company and subsidiaries or between subsidiaries refer to the same transaction, it is not required to disclose twice.
For example, if the parent company has already disclosed its transaction with a subsidiary, then the subsidiary is not required to disclose the transaction; for transactions between two subsidiaries, if one of the subsidiaries has disclosed the transaction, then the other is not required to disclose the transaction.):
(1) Parent company to subsidiary.
(2) Subsidiary to parent company.
(3) Subsidiary to subsidiary.

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

Note 4: Disclosure of the transactions over 100 million New Taiwan dollars only and the related party transactions for counterparty are not disclosed.

Table 6-6

ENNOSTAR INC. AND SUBSIDIARIES

Information on investees Six months ended June 30, 2021 Table 7

Expressed in thousands of NTD (Except as otherwise indicated)

Investor	Investee	Location	Main business activities	Initial investment amount	Initial investment amount	Shares held as atJune30,2021	Shares held as atJune30,2021	Shares held as atJune30,2021	Net profit (loss) of the investee for the six months ended June 30,2021	Investment income (loss) recognised by the Company for the six months ended June 30,2021	Footnote
				Balance as at June 30,2021	Balance as at December 31, 2020	Number of shares	Ownership (%)	Bookvalue
ENNOSTAR Inc. ENNOSTAR Inc. ENNOSTAR Inc. Epistar Corporation Epistar Corporation Epistar Corporation	Harvestar Investment Corp. Epistar Corporation Lextar Electronics Corp. iReach Corporation Epistar JV Holding (BVI) Co., Ltd. Full Star Enterprises Limited	Taiwan Taiwan Taiwan Taiwan British Virgin Islands Hong Kong	Professional investment Manufacturing and sales of LED wafers and chips Manufacturing and sales of LED wafers, chips, packages and modules Manufacturing, sales, packaging and module design of semiconductor light emitting devices Professional investment Professional investment	$ 1,000 37,607,380 11,724,646 70,000 14,960,129 166,785	$ - 37,607,380 11,724,646 70,000 14,960,129 166,785	100 1,088,701,410 514,916,380 7,000,000 48,278 Cash USD 8,660,000	100.00 100.00 100.00 39.09 100.00 100.00	$ 1,000 36,610,725 11,409,263 27,320 8,922,248 270,609	$ - 383,046 113,287 ( 7,141) 332,378 ( 6,627)	$ - 417,542 86,387 ( 7,141) 393,631 ( 6,627)

Table 7-1

Initial investment amount Shares held as at June 30, 2021

Investor	Investee	Location	Main business activities	Balance as at June 30,2021	Balance as at December 31, 2020	Number of shares	Ownership (%)	Bookvalue	Net profit (loss) of the investee for the six months ended June 30,2021	Investment income (loss) recognised by the Company for the six months ended June 30,2021	Footnote
Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation Epistar Corporation	Yenrich Technology Corporation Lighting Investment Corp. Tekcore Co., Ltd. Unikorn Semiconductor Corporation Prolight Opto Technology Corporation SH Co., Ltd. TE Opto Corporation	Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan	Manufacturing and sales of LED packages Professional investment Manufacturing and sales of LED wafers and chips OEM manufacturing of iii-v semiconductors Manufacturing and sales of LED packages Manufacturing and sales of LED wafers and chips Manufacturing and sales of LED wafers and chips	$ 600,000 2,161,814 - 1,006,350 101,500 31,792 9,200	$ 600,000 2,161,814 1,169,412 1,006,350 101,500 31,792 9,200	60,000,000 251,478,518 - 101,270,000 5,800,000 3,179,176 920,000	100.00 100.00 0.00 63.94 8.52 49.00 40.00	$ 570,923 2,095,249 - ( 18,472) 84,683 3,288 43,949	($ 133,133) ( 45,653) 23,185 ( 397,744) 12,466 51 362	($ 133,676) ( 76,012) 4,802 ( 262,836) 810 25 145	Note 1

Table 7-2

Initial investment amount

Shares held as at June 30, 2021

Investor	Investee	Location	Main business activities	Balance as at June 30,2021	Balance as at December 31, 2020	Number of shares	Ownership (%)	Bookvalue	Net profit (loss) of the investee for the six months ended June 30,2021	Investment income (loss) recognised by the Company for the six months ended June 30,2021	Footnote
Epistar Corporation Epistar Corporation Epistar Corporation Epistar JV Holding (BVI) Co.,Ltd. Epistar JV Holding (BVI) Co.,Ltd. Epistar JV Holding (BVI) Co.,Ltd. Epistar JV Holding (BVI) Co.,Ltd. Epistar JV Holding (BVI) Co.,Ltd.	GaN Force Corporation GCS Holding Inc. Can Yang Investments Limited Country Lighting (BVI) Co.,Ltd. Crystal Light Enterprise Group Ltd. HUGA Holding (SAMOA) Limited LiteStar JV Holding (BVI) Co.,Ltd. United LED Corporation (Hong Kong) Limited	Taiwan USA Hong Kong British Virgin Islands British Virgin Islands SAMOA British Virgin Islands Hong Kong	Design, manufacturing and sales of LED OEM manufacturing of GaAs / InP / GaN / SiC wafers for RF and optoelectronics Professional investment Professional investment Professional investment Professional investment Professional investment Professional investment	$ 77,700 277,554 66,745 89,843 - 334,967 3,408,835 2,029,760	$ 77,700 277,554 - 89,843 6,754 334,967 3,408,835 2,029,760	1,118,600 5,180,000 2,679,063 3,060,000 - 12,551,035 10,882 67,000,165	64.32 5.64 3.53 36.43 0.00 100.00 82.41 74.86	($ 5,101) 233,498 57,008 85,194 - 44,932 3,289,633 266,372	($ 9,864) ( 232,264) 121,661 ( 19) ( 59) 4 102,753 7,324	($ 6,345) ( 14,264) 4,192 ( 7) ( 59) 4 84,679 5,483

Table 7-3

Initial investment amount

Shares held as at June 30, 2021

Investor	Investee	Location	Main business activities	Balance as at June 30,2021	Balance as at December 31, 2020	Number of shares	Ownership (%)	Bookvalue	Net profit (loss) of the investee for the six months ended June 30,2021	Investment income (loss) recognised by the Company for the six months ended June 30,2021	Footnote
Epistar JV Holding (BVI) Co., Ltd. Epistar JV Holding (BVI) Co., Ltd. Epistar JV Holding (BVI) Co., Ltd. GaN Force Corporation GaN Force Corporation Lighting Investment Ltd. Lighting Investment Ltd. Lighting Investment Ltd.	Episky (Hong Kong) Ltd. Can Yang Investments Limited GCS Holding Inc. GV Semiconductor Inc. Joint Power eXponent, Ltd. LEDAZ Co., Ltd Interlight Optotech (HK) Co.,Limited Epistar (Hong Kong) Limited	Hong Kong Hong Kong USA USA Taiwan Korea Hong Kong Hong Kong	Professional investment Professional investment OEM manufacturing of GaAs / InP / GaN / SiC wafers for RF and optoelectronics R&D and sales of electronic components Power IC design and module sales Engineering service of LED Manufacturing and sales of LED packages Professional investment	$ 2,124,096 4,291,894 149,149 93,582 - 48,166 12,806 2,556	$ 2,124,096 4,291,894 149,149 93,582 - 48,166 12,806 2,556	Cash USD68,000,000 Cash USD141,272,700 2,750,000 8,470,000 - 88,460 429,000 82,850	100.00 80.10 2.99 100.00 0.00 28.13 30.00 100.00	$ 2,058,168 1,295,379 134,947 ( 7,276) - 26,681 11,687 ( 182)	$ 162,880 121,661 ( 232,264) ( 10,903) ( 11,927) ( 60,849) 204 -	$ 162,880 97,450 ( 7,093) ( 10,903) ( 117) ( 17,117) 61 -

Table 7-4

Initial investment amount Shares held as at June 30, 2021

Investor	Investee	Location	Main business activities	Balance as at June 30,2021	Balance as at December 31, 2020	Number of shares	Ownership (%)	Bookvalue	Net profit (loss) of the investee for the six months ended June 30,2021	Investment income (loss) recognised by the Company for the six months ended June 30,2021	Footnote
Lighting Investment Ltd. LiteStar JV Holding (BVI) Co.,Ltd. Lighting Investment Corp. Lighting Investment Corp. Lighting Investment Corp. Lighting Investment Corp. Lighting Investment Corp. Lighting Investment Corp.	Luxlite (HK) Corporation Limited Epicrystal (Hong Kong) Co. Ltd. LEDAZ Co., Ltd Lighting Investment Ltd. Yenrich Opto (Hong Kong) Limited Prolight Opto Technology Corporation Can Yang Investments Limited GaNrich Semiconductor Corporation	Hong Kong Hong Kong Korea British Virgin Islands Hong Kong Taiwan Hong Kong Taiwan	Professional investment Professional investment Engineering service of LED Professional investment Sales of LED light components Manufacturing and sales of LED packages Professional investment Design and technology service of LED lighting product	$ 133,145 4,403,034 23,993 152,701 133,433 318,929 72,436 62,370	$ 133,145 4,403,034 23,993 152,701 133,433 318,929 72,436 62,370	3,800,000 146,600,000 44,065 45,643 4,010,000 27,539,234 5,218,605 4,750,000	100.00 100.00 14.01 100.00 100.00 40.46 6.87 100.00	$ 429,346 3,990,896 17,523 618,361 150,054 404,491 111,102 1,558	($ 6,250) 102,858 ( 60,849) ( 24,991) ( 7,000) 12,466 121,661 ( 12,794)	($ 6,250) 102,858 ( 8,003) ( 24,991) ( 7,000) 3,848 8,358 ( 12,794)

Table 7-5

Initial investment amount

Shares held as at June 30, 2021

Investor	Investee	Location	Main business activities	Balance as at June 30,2021	Balance as at December 31, 2020	Number of shares	Ownership (%)	Bookvalue	Net profit (loss) of the investee for the six months ended June 30,2021	Investment income (loss) recognised by the Company for the six months ended June 30,2021	Footnote
Lighting Investment Corp. Lighting Investment Corp. Lighting Investment Corp. Lighting Investment Corp. Yenrich Technology Corporation Yenrich Technology Corporation Yenrich Technology Corporation Episky Corporation (Xiamen) Ltd.	LEDOLUX Sp.Zo.O. GCS Holding Inc. Joint Power eXponent, Ltd. Domi-Star Optoelectronics Corporation Prolight Opto Technology Corporation GCS Holding Inc. Amengine Corporation SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD	Poland USA Taiwan Taiwan Taiwan USA Taiwan China	Assembling and sales of LED bulbs OEM manufacturing of GaAs / InP / GaN / SiC wafers for RF and optoelectronics Power IC design and module sales Development and design services of LED lamps Manufacturing and sales of LED packages OEM manufacturing of GaAs / InP / GaN / SiC wafers for RF and optoelectronics Developing and sales of medical optical sensor modules. Sales of LED chips	$ 133,455 148,942 11,599 490 19,994 228,748 20,000 43,770	$ 133,455 148,942 - - 29,372 228,748 12,050 43,770	156,994 2,748,000 1,757,000 49,000 1,822,000 4,113,000 3,100,000 Cash RMB10,000,000	60.00 2.99 13.52 49.00 2.68 4.48 58.59 100.00	$ 12,580 134,314 6,139 417 26,716 201,032 11,368 110,891	($ 286) ( 232,264) ( 11,927) ( 149) 12,466 ( 232,264) ( 5,469) 68,482	($ 172) ( 7,567) ( 1,495) ( 73) 326 ( 10,571) ( 2,867) 68,482

Table 7-6

Initial investment amount

Shares held as at June 30, 2021

Investor	Investee	Location	Main business activities	Balance as at June 30,2021	Balance as at December 31, 2020	Number of shares	Ownership (%)	Bookvalue	Net profit (loss) of the investee for the six months ended June 30,2021	Investment income (loss) recognised by the Company for the six months ended June 30,2021	Footnote
Episky Corp.(Xiamen) Ltd. Episky Corp.(Xiamen) Ltd. Epicrystal (Changzhou) Co., Ltd. Prolight Opto Technology Corporation Prolight Opto Holding Corporation Full Star Enterprises Limited Yenrich Opto (Hong Kong) Limited GaNrich Semiconductor Corporation	Epicrystal (Changzhou) Co., Ltd. LEADSTAR Micro-Crystal Display Corporation (JiangSu) Ltd. Changzhou Chemsemi Co., Ltd. Prolight Opto Holding Corporation Prolight Opto Technology Corporation GCS Holding Inc. GCS Holding Inc. GCS Holding Inc.	China China China Seychelles Seychelles USA USA USA	Manufacturing and sales of LED wafers and chips Developing, manufacturing and sales of LED packages, modules and related applications OEM manufacturing of compound semiconductor RFID wafers and optoelectronic wafers. Professional investment Professional investment OEM manufacturing of GaAs / InP / GaN / SiC wafers for RF and optoelectronics OEM manufacturing of GaAs / InP / GaN / SiC wafers for RF and optoelectronics OEM manufacturing of GaAs / InP / GaN / SiC wafers for RF and optoelectronics	$ 147,472 122,036 469,590 4,402 4,403 `113,896` 62,371 54	$ 147,472 122,036 469,590 4,402 4,403 `113,896` 62,371 54	Cash USD5,200,000 Cash RMB29,100,000 Cash RMB110,000,000 `150,000` `150,000` `2,100,000` 1,150,000 1,000	3.31 15.32 18.04 100.00 100.00 `2.29` `1.25` `-`	$ 141,464 121,059 412,994 1,726 1,752 `102,681` 54,792 49	$ 110,149 4,542 ( 175,205) 813 813 `232,264)` `(` ( 232,264) ( 232,264)	$ 3,646 ( 104) ( 32,057) 813 813 `5,413)` `(` ( 3,225) ( 3)	Note 2

Table 7-7

Initial investment amount

Shares held as at June 30, 2021

Investor	Investee	Location	Main business activities	Balance as at June 30,2021	Balance as at December 31, 2020	Number of shares	Ownership (%)	Bookvalue	Net profit (loss) of the investee for the six months ended June 30,2021	Investment income (loss) recognised by the Company for the six months ended June 30,2021	Footnote
Unikorn Semiconductor Corporation Lextar Electronics Corp. Lextar Electronics Corp. Lextar Electronics Corp. Lextar Electronics Corp. Lextar Electronics Corp. Lextar Electronics Corp. Lextar Electronics Corp.	GCS Holding Inc. Lextar (Singapore) Pte. Ltd. Wellybond Optronics HK Limited Wellypower Optronics Corporation Apower Optronics Corporation Liang Li Investment Co., Ltd. Wellybond Corporation Trendylite Corporation	USA Sinapore Hong Kong British Virgin Islands British Virgin Islands Taiwan Taiwan Taiwan	OEM manufacturing of GaAs / InP / GaN / SiC wafers for RF and optoelectronics Professional investment Professional investment Professional investment Professional investment Professional investment Professional investment Sales of products	$ 1,051 2,709,310 17,888 44,898 381,638 25,374 396,484 18,100	$ - 2,709,310 17,888 44,898 381,638 25,374 396,484 18,100	20,000 90,270,000 63,000,000 5,153,061 31,600,000 3,000,000 40,000,000 2,715,000	0.02 100.00 100.00 100.00 100.00 100.00 100.00 90.50	$ 1,051 2,420,826 10,783 147,536 1,059,383 15,450 315,115 38,368	($ 232,264) 30,521 8 2,085 15,790 ( 2,114) 30,413 4,386	$ - 30,521 8 2,085 15,790 ( 2,114) 30,413 3,969

Table 7-8

Initial investment amount

Shares held as at June 30, 2021

Investor	Investee	Location	Main business activities	Balance as at June 30,2021	Balance as at December 31, 2020	Number of shares	Ownership (%)	Bookvalue	Net profit (loss) of the investee for the six months ended June 30,2021	Investment income (loss) recognised by the Company for the six months ended June 30,2021	Footnote
Lextar Electronics Corp. Lextar Electronics Corp. Wellybond Corporation Wellybond Corporation Wellybond Corporation Wellybond Corporation Wellybond Corporation	First Vertical Laser Inc. HEXAWAVE INC. VOGITO INNOVATION CO., LTD. HEXAWAVE INC. WellyHertz Electronics Corp. Joint Power eXponent, Ltd. Prolight Opto Technology Corporation	Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan	Design and manufacturing VCSEL Lei chip Manufacturing and sales of compound semiconductor materials and modules. Design of lighting. Manufacturing and sales of compound semiconductor materials and modules. Manufacturing and sales of switching power supply modules. Power IC design and module sales Manufacturing and sales of LED packages	$ 85,907 147,506 1,000 147,494 10,000 33,000 250	$ 93,616 147,506 1,000 147,494 10,000 - -	5,319,000 12,716,000 100,000 12,715,000 1,000,000 2,200,000 10,000	21.46 31.69 50.00 31.68 90.91 16.92 0.01	$ 34,401 105,986 2,095 105,977 8,515 29,377 247	($ 29,164) ( 31,591) 1,524 ( 31,591) ( 1,634) ( 16,238) 9,125	($ 8,161) ( 10,748) 762 ( 10,747) ( 1,486) ( 3,623) ( 3)

Table 7-9

Initial investment amount

Shares held as at June 30, 2021

Investor	Investee	Location	Main business activities	Balance as at June 30,2021	Balance as at December 31, 2020	Number of shares	Ownership (%)	Bookvalue	Net profit (loss) of the investee for the six months ended June 30,2021	Investment income (loss) recognised by the Company for the six months ended June 30,2021	Footnote
Lextar (Singapore) Pte. Ltd. Lextar (Singapore) Pte. Ltd. Liang Li Investment Co., Ltd.	Lextar Electronics Korea Ltd. Aurora International Lighting Corporation Limited First Vertical Laser Inc.	Korea Hong Kong Taiwan	Sale of LED and after-sales service. Sales of lighting. Design and manufacturing VCSEL Lei chip	$ 3,025 204,136 15,332	$ 3,025 204,136 15,332	22,000 2,000,000 950,000	100.00 20.00 3.83	$ 4,111 182,143 6,144	$ 190 ( 6,974) ( 29,164)	$ 190 814 ( 1,350)

Note1: Preferred stock $6,350 thousands (1,270 thousand shares) were included in the number of shares but excluded in calculating the shareholder’s ownership (%). Note2: The group holds two seats on the Board of Directors, which indicates that the Group has significant influence over the investee. Accordingly, the Group listed the investee as an associate.

Table 7-10

ENNOSTAR INC. AND SUBSIDIARIES

Information on investments in Mainland China Six months ended June 30, 2021

Table 8 Investee in Mainland China	Main business activities	Paid-in capital	Investment method `（`Note 1`）`	Accumulated amount of remittance from Taiwan to Mainland China as of January 1, 2021	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the six months ended June 30, 2021	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the six months ended June 30, 2021	Accumulated amount of remittance from Taiwan to Mainland China as of June 30, 2021	Net income of investee for the six months ended June 30, 2021	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the six months ended June 30, 2021 `（`Note 2`）`	Book value of investments in Mainland China as of June 30, 2021 Accumulated amount of investment income remitted back to Taiwan as of June 30,2021 Footnote Expressed in thousands of NTD (Except as otherwise indicated)	Book value of investments in Mainland China as of June 30, 2021 Accumulated amount of investment income remitted back to Taiwan as of June 30,2021 Footnote Expressed in thousands of NTD (Except as otherwise indicated)	Book value of investments in Mainland China as of June 30, 2021 Accumulated amount of investment income remitted back to Taiwan as of June 30,2021 Footnote Expressed in thousands of NTD (Except as otherwise indicated)
					Remitted to Mainland China	Remitted back to Taiwan
Episky Corporation (Xiamen) Ltd. United LED Shan Dong Corporation Epicrystal Corporation (Changzhou) Ltd. Luxlite (Shenzhen) Corporation Limited KAISTAR Lighting (Xiamen) Co., Ltd.	Manufacturing and sales of LED chips Manufacturing and sales of LED wafers and chips Manufacturing and sales of LED wafers and chips Sales of LED chips Manufacturing and sales of LED wafers, chips, packages and modules	$ 18,940,480 2,340,240 4,374,020 83,580 7,577,887	2 2 2 2 2	$ 1,894,480 1,776,075 3,332,056 47,386 1,422,532	$ - - - - -	$ - - - - -	$ 1,894,480 1,776,075 3,332,056 47,386 1,422,532	$ 162,880 7,543 110,149 ( 6,525) -	100.00 74.86 76.95 100.00 18.77	$ 162,880 5,647 84,765 ( 6,525) -	$ 2,058,162 287,045 3,288,897 302,925 1,599,277	$ - - - 53,770 -	2(3) 2(3) 2(2) 2(2) 2(3)

Table 8-1

Investee in Mainland China	Main business activities	Paid-in capital	Investment method `（`Note 1`）`	Accumulated amount of remittance from Taiwan to Mainland China as of January 1, 2021	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the six months ended June 30, 2021	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the six months ended June 30, 2021	Accumulated amount of remittance from Taiwan to Mainland China as of June 30, 2021	Net income of investee for the six months ended June 30, 2021	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the six months ended June 30, 2021 `（`Note 2`）`	Book value of investments in Mainland China as of June 30, 2021	Accumulated amount of investment income remitted back to Taiwan as of June 30,2021	Footnote
					Remitted to Mainland China	Remitted back to Taiwan
Everlight Electronics (Fujian) Co., Ltd APT Electronics Co., Ltd. China Crystal Technologies Co.,Ltd. Ufeco Technology Inc. Very Optoelectronics (HUI ZHOU) Co., Ltd.	Manufacturing and sales of LED backlight and related parts Developing, manufacturing and sale of LED extension and chip, module and light instrument Developing, manufacturing and sale of gallium arsenide unit crystal and chips Developing, manufacturing and sale of LED application products Research and development, manufacturing and sale of LED packaging; research and development, manufacturing and sale of backlight module, lighting modules and accessories	$ 696,500 1,773,134 852,171 69,650 430,900	2 3 2 2 2	$ 69,650 288,195 93,516 7,256 203,939	$ - - - - -	$ - - - - -	$ 69,650 288,195 93,516 7,256 203,939	$ - - - - -	$ 10.00 11.80 8.97 0.00 0.00	- - ( 18,489) - -	$ 60,860 - 36,772 - -	$ - - - - -	2(3) 2(3) 2(3) 2(3) 2(3)

Table 8-2

Investee in Mainland China	Main business activities	Paid-in capital	Investment method `（`Note 1`）`	Accumulated amount of remittance from Taiwan to Mainland China as of January 1, 2021	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the six months ended June 30, 2021	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the six months ended June 30, 2021	Accumulated amount of remittance from Taiwan to Mainland China as of June 30, 2021	Net income of investee for the six months ended June 30, 2021	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the six months ended June 30, 2021 `（`Note 2`）`	Book value of investments in Mainland China as of June 30, 2021	Accumulated amount of investment income remitted back to Taiwan as of June 30,2021	Footnote
					Remitted to Mainland China	Remitted back to Taiwan
Ningbo Formosa Epitaxy Incorporation Jiangsu Canyang Optoelectronics Ltd. Shanghai Welight Electronic Co., LTD. LEADSTAR Micro- Crystal Display Corporation (JiangSu) Ltd. Lextar Electronics (Suzhou) Corp.	Sales of LED chips Manufacturing and sales of LED wafers and chips Wholesale and export and import of LED and related electronic products Developing, manufacturing and sales of LED packages, modules and related applications. Manufacturing and sales of LED wafers, chips, packages and modules	$ 5,572 5,349,120 4,179 818,710 3,722,205	2 2 2 2 2	$ 46,895 2,218,289 4,179 167,570 3,585,860	- - - - -	- - - - -	$ 46,895 2,218,289 4,179 167,570 3,585,860	($ 59) 121,840 813 4,542 49,431	0.00 90.50 51.66 21.53 100.00	($ 59) 110,000 813 ( 277) 49,431	$ - 1,463,488 1,911 170,131 3,258,524	- - - - -	2(3) 2(3) 2(2) 2(3) 2(2)

Table 8-3

Investee in Mainland China	Main business activities	Paid-in capital	Investment method `（`Note 1`）`	Accumulated amount of remittance from Taiwan to Mainland China as of January 1, 2021	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the six months ended June 30, 2021	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the six months ended June 30, 2021	Accumulated amount of remittance from Taiwan to Mainland China as of June 30, 2021	Net income of investee for the six months ended June 30, 2021	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the six months ended June 30, 2021 `（`Note 2`）`	Book value of investments in Mainland China as of June 30, 2021	Accumulated amount of investment income remitted back to Taiwan as of June 30,2021	Footnote
					Remitted to Mainland China	Remitted back to Taiwan
Lextar Electronics (Xiamen) Corp. Chuzhou Bwin Technology Corp. Lextar Electronics (Chuzhou) Corp.	Manufacturing and sales of LED lighting and modules Developing, manufacturing, sales of metal and plastic technical products. Manufacturing and sales of LED wafers, chips, packages and modules	$ 32,759 258,540 3,094,825	2 2 2	$ 32,759 - -	- - -	- - -	$ 32,759 - -	($ 1,887) 5,560 115,060	100.00 48.33 100.00	($ 1,887) 1,833 115,060	$ 13,926 110,974 3,000,048	- - -	2(3) 2(3) 2(2)

Table 8-4

Companyname	Accumulated amount of remittance from Taiwan to Mainland China as ofJune30,2021	Investment amount approved by the Investment Commission of the Ministry of Economic Affairs (MOEA)	Ceiling on investments in Mainland China imposed by the Investment Commission of MOEA
Epistar Corporation Lextar Electronics Corporation	$ 11,426,465 $ 3,633,067	$ 12,388,950 $ 4,044,862	$ 23,603,563 $ 5,900,255

Note 1: The investments are classified in three types; they are numbered as follows:

Direct investment in Mainland China companies;
Through investing in an existing company in the third area, which then invested in the investee in Mainland China.
Other ways.

Note 2: Investment income or loss in this period:

The bases for recognition of investment income or loss are classified into four types; they are numbered as follows:

The financial statements that are audited by the international accounting firm which has a cooperative relationship with the R.O.C. accounting firm;
The financial statements that are audited by the R.O.C. parent company’s independent auditors;
The financial statements that are not audited by the independent auditors;
Others.

Note 3: The amount disclosed was based on Investment Commission, MOEA Regulation No. 09704604680 announced on August 29, 2008.

Note 4: The numbers in the table shall be expressed in NTD. Foreign currencies shall be translated into NTD at the exchange rate prevailing on the financial reporting date. Note 5: The ‘amounts’ are expressed in thousands of New Taiwan dollars.

Table 8-5

Table 9

ENNOSTAR INC. AND SUBSIDIARIES

Significant transactions conducted with investees in Mainland China directly or indirectly through other companies in the third areas

Six months ended June 30, 2021

Expressed in thousands of NTD

(Except as otherwise indicated)

Investee in Mainland China	Sale(purchase)	Sale(purchase)	Propertytransaction	Propertytransaction	Accounts receivable (payable)	Accounts receivable (payable)	Provision of endorsements/guarantees or collaterals	Provision of endorsements/guarantees or collaterals		Financing	Financing		Others
LEADSTAR Micro-Crystal Display Corporation (JiangSu) Ltd. Episky Corp.(Xiamen) Ltd. Jiangsu Canyang Optoelectronics Ltd. SHENZHEN EPIKYLIN OPTOELECTRONICS CO.,LTD Epicrystal (Changzhou) Co., Ltd. Shanghai Welight Electronic Co., LTD Jiangsu Canyang Optoelectronics Ltd. Episky Corp.(Xiamen) Ltd. Epicrystal (Changzhou) Co., Ltd. Lextar Electronics (Chuzhou) Corp Lextar Electronics (Chuzhou) Corp Chuzhou Bwin Technology Corp.	Amount	%	Amount	%	Balance at June 30,2021	%	Balance at June 30,2021	Purpose	Maximum balance during the six months ended June 30, 2021	Balance at June 30,2021	Interest rate	Interest during the six months ended June 30, 2021
	$ 293,293 476,178 164,790 467,029 236,997 108,836 ( 673,015) ( 573,435) 152,437) ( 2,153,843) ( 436,613) ( 113,932) (	1.81 2.93 1.01 2.88 1.46 0.67 ( 4.14) 3.53) ( 0.94) ( 13.26) ( 2.69) ( 0.70) (	$ - 67 - - 4,225 - - - - - - -	- 0.01 - - 0.42 - - - - - - -	$ 117,552 471,455 208,429 461,861 116,794 119,004 ( 103,014) 61,959) ( 764,948) ( 1,280,934) ( 416,259) ( 42,225) (	0.16 0.64 0.28 0.63 0.16 0.16 ( 0.14) ( 0.08) ( 1.04) ( 1.75) ( 0.57) ( 0.06)	$ - - 501,480 - - - - 1,504,440 - - - -	`-` `-` `-` `-` `-` `-` `-` `-` `-` `-` `-` `-`	$ - - 438,400 - - - - - - `-` - `-`	$ - - 430,900 - - - - - - `-` - `-`	- - 4.14% - - - - - - - - -	$ - - 2,718 - - - - - - - - -

Table 9-1

AI assistant

ENNOSTAR — Interim / Quarterly Report 2021

52376_rns_2021-12-30_e597c31c-ad3e-48fa-ba0d-5bf5413b0c2c.pdf

ENNOSTAR INC. AND SUBSIDIARIES

INDEPENDENT AUDITORS’ REVIEW REPORT

Introduction

Scope of review

Basis for qualified conclusion

Qualified conclusion

Emphasis of matter

ENNOSTAR INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS JUNE 30, 2021, DECEMBER 31, 2020 AND JUNE 30, 2020

ENNOSTAR INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

JUNE 30, 2021, DECEMBER 31, 2020 AND JUNE 30, 2020

ENNOSTAR INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 2021 AND 2020

ENNOSTAR INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 2021 AND 2020

ENNOSTAR INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

SIX MONTHS ENDED JUNE 30, 2021 AND 2020

ENNOSTAR INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

SIX MONTHS ENDED JUNE 30, 2021 AND 2020

ENNOSTAR INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

SIX MONTHS ENDED JUNE 30, 2021 AND 2020

ENNOSTAR INC. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2021 AND 2020

1. HISTORY AND ORGANIZATION

2. THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL

STATEMENTS AND PROCEDURES FOR AUTHORIZATION

3. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS

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

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(1) Compliance statement

B. Subsidiaries included in the consolidated financial statements:

(4) Foreign currency translation

(19) Intangible assets

6. DETAILS OF SIGNIFICANT ACCOUNTS

(1) Cash and cash equivalents

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

(6) Investments accounted for using the equity method

(7) Property, plant and equipment

(9) Intangible assets

(10) Impairment of non-financial assets

(13) Short-term notes and bills payable

(14) Other payables

- (15) Long term borrowings

Borrowing period and

Interest rate range

(16) Pensions

(19) Share capital

D. Information of the Company’s shares held by subsidiaries as follows:

(20) Capital surplus

(21) Unappropriated retained earnings (Accumulated deficit)

(22) Other equity items

(24) Other income and expenses– net

(25) Interest income

(26) Other income

(28) Finance costs

(33) Business combinations

(34) Supplemental cash flow information

A. Investing activities with partial cash payments

(35) Changes in liabilities from financing activities

7. RELATED PARTY TRANSACTIONS

(1) Names of related parties and relationship

C. Receivables from related parties:

D. Other receivables from related parties:

E. Payables from related parties:

(3) Key management compensation

8. PLEDGED ASSETS

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACT

COMMITMENTS

10. SIGNIFICANT DISASTER LOSS

None.

11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE

12. OTHERS

(1) Capital risk management

(2) Financial instruments

A Financial instruments by category

ENNOSTAR Interim / Quarterly Report 2021