FCFC — Audit Report / Information 2021

Nov 16, 2021

FORMOSA CHEMICALS & FIBRE CORPORATION AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND

INDEPENDENT AUDITORS’ REPORT DECEMBER 31, 2021 AND 2020

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

FORMOSA CHEMICALS & FIBRE CORPORATION

AND SUBSIDIARIES

INDEX

INDEX
Items Index Independent Auditors’ Report Consolidated Balance Sheets Consolidated Statements of Comprehensive Income Consolidated Statements of Changes in Equity Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements	Pages
	1-7 8-9 10-11 12 13-14 15-100

INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

PWCR21000320 To the Board of Directors and Shareholders of Formosa Chemicals & Fibre Corporation

Introduction

We have audited the accompanying consolidated balance sheets of Formosa Chemicals & Fibre Corporation and subsidiaries (the “Group”) as at December 31, 2021 and 2020, and the related consolidated statements of comprehensive income, of changes in equity and of cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, based on our audits and the reports of other auditors (please refer to the Other matter section), the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2021 and 2020, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission.

Basis for opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and generally accepted auditing standards in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the consolidated financial statements section of our report. We are independent of the Group in accordance with the Norm of Professional Ethics for Certified Public Accountant of the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

~1~

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Group’s 2021 consolidated financial statements. These matters were addressed in the context of our audit of the consolidated financial statements as a whole and, in forming our opinion thereon, we do not provide a separate opinion on these matters.

Assessment of loss allowance for accounts receivable

Description

Refer to Note 4(11) for accounting policy on accounts receivable, Note 5(2) for uncertainty of accounting estimates and assumptions in relation to impairment of accounts receivable, and Note 6(5) for details of loss allowance for accounts receivable. As of December 31, 2021, the Group’s accounts receivable amounted to NT$28,923,517 thousand, net of loss allowance in the amount of NT$155,526 thousand.

The Group assesses expected credit impairment loss on accounts receivable based on historical experience, forward-looking information and known reason or existing objective evidences. For those accounts which are considered uncollectible, the Company recognises impairment with a credit to accounts receivable. Management evaluates the reasonableness of estimated provision periodically. As the estimation of loss allowance is subject to management’s judgement and business indicators, the amount of provision is based on the collectability of accounts receivable, and considering that accounts receivable and loss allowance are material to the financial statements, we considered the loss allowance for accounts receivable a key audit matter.

How our audit addressed the matter

We performed the following audit procedures in respect of the above key audit matter:

1. Obtained the overdue aging report used when management assesses the expected credit impairment loss, assessed whether the logic of data source was consistently applied, and tested its accuracy with proper documents.

2. Assessed the reasonableness of estimates used by management in calculating expected credit impairment loss and obtained supporting documents, including forward-looking information, disputed accounts, overdue accounts, subsequent collection, and other indications that would show the customer would be unable to repay on schedule.

~2~

1. Performed subsequent collection test in order to verify the adequacy of loss allowance provided for accounts receivable.

Evaluation of inventories

Description

Refer to Note 4(13) for accounting policy on inventory valuation, Note 5(2) for accounting estimates and assumption uncertainty in relation to inventory valuation, and Note 6(6) for detailed information on allowance for inventory valuation losses. As of December 31, 2021, the inventory and allowance for inventory valuation losses were NT$48,955,197 thousand and NT$1,754,722 thousand, respectively.

The Group is primarily engaged in the manufacture and sales of petrochemical plastic products, fibers weaving and cords. As the price of petrochemical plastic products is subject to the fluctuations in international crude oil price, and the textile market is competitive, there is a higher risk for inventory valuation loss. The Group recognises inventories at the lower of cost and net realisable value, and the net realisable value is calculated based on average price less selling expenses. Since the net realisable value used in inventory valuation involves subjective judgement and high uncertainty in estimation, and the allowance for inventory valuation losses is material to the financial statements, we considered the allowance for inventory valuation losses as a key audit matter.

How our audit addressed the matter

We performed the following audit procedures in respect of the above key audit matter:

1. Assessed the reasonableness of policies and procedures on allowance for inventory valuation loss, including the reasonableness of classification of inventory in determining the net realisable value.

2. Understood the Group’s warehousing control procedures. Reviewed the annual physical inventory count plan and participated in the annual inventory count in order to assess the effectiveness of the classification of inventory and internal control over inventory.

3. Checked the method in calculating the net realisable value of inventory and assessed the reasonableness of allowance for valuation loss.

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Other matter – Reference to the audits of other auditors

We did not audit the financial statements of certain subsidiaries and investments accounted for under the equity method which were audited by other auditors. Therefore, our opinion expressed herein, insofar as it relates to the amounts included in respect of these subsidiaries and associates, is based solely on the reports of the other auditors. Total assets of these subsidiaries and the balances of these investments accounted for under the equity method amounted to NT$157,808,066 thousand and NT$142,480,542 thousand, constituting 26% and 27% of the consolidated total assets as at December 31, 2021 and 2020, respectively, and operating revenue amounted to NT$28,464,573 thousand and NT$24,251,284 thousand, constituting 8% and 10% of the consolidated total operating revenue for the years then ended, respectively. The comprehensive income recognised from these associates and joint ventures accounted for under the equity method amounted to NT$14,655,582 thousand and NT$2,077,294 thousand, constituting 22% and 18% of the consolidated total comprehensive income for the years ended December 31, 2021 and 2020, respectively.

Other matter – Parent company only financial reports

We have audited the parent company only financial statements of Formosa Chemicals & Fibre Corporation as of and for the years ended December 31, 2021 and 2020, and have expressed an unqualified opinion on those financial statements.

Responsibilities of management and those charged with governance for the consolidated financial statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

~4~

In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Those charged with governance, including audit committee, are responsible for overseeing the Group’s financial reporting process.

Auditors’ responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the generally accepted auditing standards in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with the generally accepted auditing standards in the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

1. Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

2. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.

3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

~5~

1. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group to cease to continue as a going concern.

2. Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

3. Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

~6~

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Wu, Han-Chi

[Chou, Chien-Hung ]

For and on behalf of PricewaterhouseCoopers, Taiwan March 9, 2022

------------------------------------------------------------------------------------------------------------------------------------------------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’ 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.

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

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FORMOSA CHEMICALS & FIBRE CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

(Expressed in thousands of New Taiwan dollars)

Assets	Notes 6(1) 6(2) 6(3) 6(4) 6(5) 6(5) and 7 6(5) 6(5) and 7 7 7 6(6) and 8 7 6(3) 6(4) and 8 6(7) 6(8), 7 and 8 6(9) 6(27) 6(1)	December 31, 2021 AMOUNT % $ 23,062,097 4 3,903,900 1 116,451,723 20 1,953,235 - 8,173,238 1 8,505 - 20,204,508 3 8,719,009 2 2,742,096 - 2,698,693 - 47,200,475 8 11,513,548 2 246,631,027 41 72,999,266 12 2,390,179 1 129,632,702 22 130,897,801 22 1,577,555 - 5,884 - 2,240,322 - 11,970,535 2 351,714,244 59 $ 598,345,271 100	December 31, 2020	December 31, 2020
		AMOUNT $ 23,062,097 3,903,900 116,451,723 1,953,235 8,173,238 8,505 20,204,508 8,719,009 2,742,096 2,698,693 47,200,475 11,513,548 246,631,027 72,999,266 2,390,179 129,632,702 130,897,801 1,577,555 5,884 2,240,322 11,970,535 351,714,244 $ 598,345,271	AMOUNT $ 17,127,127 3,888,592 109,489,471 1,116,878 10,884,391 4,260 16,661,036 5,954,694 2,558,805 4,195,598 33,047,807 10,936,356 215,865,015 59,621,608 263,646 116,029,032 127,268,960 1,541,844 3,436 2,111,162 9,115,725 315,955,413 $ 531,820,428	%
Current assets 1100 Cash and cash equivalents 1110 Financial assets at fair value through profit or loss - current 1120 Current financial assets at fair value through other comprehensive income 1136 Current financial assets at amortised cost 1150 Notes receivable, net 1160 Notes receivable - related parties 1170 Accounts receivable, net 1180 Accounts receivable - related parties 1200 Other receivables 1210 Other receivables - related parties 130X Inventory 1470 Other current assets 11XX Total current assets Non-current assets 1517 Non-current financial assets at fair value through other comprehensive income 1535 Non-current financial assets at amortised cost 1550 Investments accounted for under equity method 1600 Property, plant and equipment 1755 Right-of-use assets 1780 Intangible assets 1840 Deferred income tax assets 1900 Other non-current assets 15XX Total non-current assets 1XXX Total assets				3 1 21 - 2 - 3 1 1 1 6 2
				41
				11 - 22 24 - - - 2
				59
				100

(Continued)

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FORMOSA CHEMICALS & FIBRE CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

(Expressed in thousands of New Taiwan dollars)

Liabilities and Equity	December 31, 2021 December 31, 2020 Notes AMOUNT % AMOUNT % 6(11) $ 17,512,874 3 $ 19,055,620 4 6(11) 17,796,625 3 16,096,733 3 6(12) - - 137 - 246,102 - 225,924 - 3,888,771 - 5,930,437 1 7 17,527,128 3 12,208,567 2 7 12,762,681 2 8,656,243 2 7 542,013 - 531,808 - 5,732,381 1 2,423,121 1 110,520 - 125,986 - 6(13)(14) 4,550,000 1 2,106,821 - 4,247,942 1 6,091,542 1 84,917,037 14 73,452,939 14 6(13) 45,500,000 8 40,050,000 8 6(14) 17,177,183 3 16,241,267 3 6(27) 382,012 - 440,237 - 793,472 - 711,804 - 6(15) 5,594,613 1 5,471,652 1 69,447,280 12 62,914,960 12 154,364,317 26 136,367,899 26 6(16) 58,611,863 10 58,611,863 11 6(17) 9,192,999 1 9,167,637 2 6(18) 66,313,982 11 64,335,076 12 70,032,921 12 66,328,339 13 72,145,718 12 53,380,101 10 6(19) 114,997,001 19 92,854,794 17 6(16) ( 323,952) - ( 323,952) - 390,970,532 65 344,353,858 65 53,010,422 9 51,098,671 9 443,980,954 74 395,452,529 74 9 11 $ 598,345,271 100 $ 531,820,428 100	December 31, 2020	December 31, 2020
			%
Current liabilities 2100 Short-term borrowings 2110 Short-term notes and bills payable 2120 Financial liabilities at fair value through profit or loss - current 2150 Notes payable 2170 Accounts payable 2180 Accounts payable - related parties 2200 Other payables 2220 Other payables - related parties 2230 Current income tax liabilities 2280 Current lease liabilities 2320 Long-term liabilities, current portion 2399 Other current liabilities 21XX Total current liabilities Non-current liabilities 2530 Corporate bonds payable 2540 Long-term borrowings 2570 Deferred income tax liabilities 2580 Non-current lease liabilities 2600 Other non-current liabilities 25XX Total non-current liabilities 2XXX Total liabilities Equity attributable to owners of parent Share capital 3110 Common stock Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3320 Special reserve 3350 Unappropriated retained earnings Other equity interest 3400 Other equity interest 3500 Treasury stocks 31XX Equity attributable to owners of the parent 36XX Non-controlling interest 3XXX Total equity Significant contingent liabilities and unrecognised contract commitments Significant events after the balance sheet date 3X2X Total liabilities and equity			4 3 - - 1 2 2 - 1 - - 1
			14
			8 3 - - 1
			12
			26
			11 2 12 13 10 17 -
			65
			9
			74
			100

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

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FORMOSA CHEMICALS & FIBRE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

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

Items

Year ended December 31 2021 2020 Notes AMOUNT % AMOUNT % 6(20) and 7 $ 365,812,098 100 $ 253,294,668 100 6(6)(15)(25)(26) and 7 ( 312,373,726) ( 85 ) ( 223,762,600) ( 88 ) 53,438,372 15 29,532,068 12 6(15)(25)(26) and 7 ( 12,840,956) ( 3 ) ( 8,870,730) ( 4 ) ( 6,164,686) ( 2 ) ( 5,337,718) ( 2 ) ( 19,005,642) ( 5 ) ( 14,208,448) ( 6 ) 34,432,730 10 15,323,620 6 6(21) 350,874 - 356,766 - 6(22) and 7 4,446,994 1 6,995,269 3 6(23) ( 589,966) - ( 394,027) - 6(8)(24) and 7 ( 1,048,054) - ( 1,293,887) - 6(7) 12,567,317 3 3,779,946 1 15,727,165 4 9,444,067 4 50,159,895 14 24,767,687 10 6(27) ( 7,452,464) ( 2 ) ( 3,213,494) ( 1 ) 42,707,431 12 21,554,193 9 6(10) - - ( 484) - $ 42,707,431 12 $ 21,553,709 9

4000 Operating revenue 5000 Operating costs 5900 Net operating margin Operating expenses 6100 Selling expenses 6200 General and administrative expenses 6000 Total operating expenses 6900 Operating profit Non-operating income and expenses 7100 Interest income 7010 Other income 7020 Other gains and losses 7050 Finance costs 7060 Share of profit of associates and joint ventures accounted for under equity method 7000 Total non-operating income and expenses 7900 Profit before income tax 7950 Income tax expense 8000 Profit for the year from continuing operations 8100 Loss from discontinued operations 8200 Profit for the year

(Continued)

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FORMOSA CHEMICALS & FIBRE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

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

					Year ended December 31	Year ended December 31	Year ended December 31	Year ended December 31
				2021				2020
	Items	Notes		AMOUNT	%			AMOUNT	%
	Other comprehensive income (net)	6(19)(27)
	Components of other comprehensive
	income that will not be reclassified to
	profit or loss
8311	Actuarial (loss) gain on defined
	benefit plans	(	$	349,586)		-	$	305,882		-
8316	Unrealised gain (loss) on financial
	assets measured at fair value through
	other comprehensive income			21,961,032		6 (		8,423,056) (		4 )
8320	Share of other comprehensive
	income (loss) of associates and joint
	ventures accounted for using equity
	method			2,693,570		1(		775,897)		-
8310	Other comprehensive income
	(loss) that will not be reclassified
	to profit or loss			24,305,016		7(		8,893,071) (		4 )
	Components of other comprehensive
	income that will be reclassified to
	profit or loss
8361	Financial statements translation
	differences of foreign operations	(		939,757) (		1 ) (		371,436)		-
8370	Share of other comprehensive loss of
	associates and joint ventures
	accounted for under equity method	(		539,943)		- (		784,121)		-
8399	Income tax relating to the
	components of other comprehensive
	income			111,624		- (		104,057)		-
8360	Other comprehensive loss that will
	be reclassified to profit or loss	(		1,368,076) (		1 ) (		1,259,614)		-
8300	Total other comprehensive income
	(loss) for the year		$	22,936,940		6(	$	10,152,685) (		4 )
8500	Total comprehensive income for the
	year		$	65,644,371		18	$	11,401,024		5
	Net income attributable to:
8610	Owners of the parent		$	38,359,347		11	$	19,544,141		8
8620	Non-controlling interest			4,348,084		1		2,009,568		1
			$	42,707,431		12	$	21,553,709		9
	Total comprehensive income
	attributable to:
8710	Owners of the parent		$	61,244,278		17	$	10,128,238		4
8720	Non-controlling interest			4,400,093		1		1,272,786		1
			$	65,644,371		18	$	11,401,024		5
	Basic earnings per share
9710	Income from continuing operations		$			-	$			-
9720	Net income of non-controlling
	interests					-				-
9750	Net income attributable to ordinary
	equity holders of the parent		$			-	$			-
	Pro forma information assuming the investment of the subsidiary,			Formosa Taffeta	Co., Ltd., and indirectly owned subsidiary are				not
	treated as treasury stock:
	Income from continuing operations		$			-	$			-
	Net income of non-controlling
	interests					-				-
	Net income attributable to ordinary
	equity holders of the parent		$			-	$			-

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

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FORMOSA CHEMICALS & FIBRE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Expressed in thousands of New Taiwan dollars)

Notes For the year ended December 31, 2020 Balance at January 1, 2020 Profit for the year Other comprehensive income (loss) for the year 6(19) Total comprehensive income (loss) Appropriations of 2019 earnings 6(18) Legal reserve Special reserve Cash dividends Changes in the net interest of associates recognised under the equity method 6(17) Cash dividends reclassified to capital surplus 6(17) Dividends paid to subsidiaries to adjust capital surplus 6(17) Expired cash dividends reclassified to capital surplus 6(17) Changes in ownership interests in subsidiaries 6(16) Disposal of equity instruments measured at fair value through other comprehensive income Cash dividends paid by consolidated subsidiaries Decrease in non-controlling interest-disposal of ownership interests in subsidiaries Increase in non-controlling interest-acquisition of ownership interests in subsidiaries Balance at December 31, 2020 For the year ended December 31, 2021 Balance at January 1, 2021 Profit for the year Other comprehensive income (loss) for the year 6(19) Total comprehensive income (loss) Appropriations of 2020 earnings 6(18) Legal reserve Special reserve Cash dividends Changes in the net interest of associates recognised under the equity method 6(17) Cash dividends reclassified to capital surplus 6(17) Dividends paid to subsidiaries to adjust capital surplus 6(17) Expired cash dividends reclassified to capital surplus 6(17) Changes in ownership interests in subsidiaries 6(17) Disposal of equity instruments measured at fair value through other comprehensive income Cash dividends paid by consolidated subsidiaries Decrease in non-controlling interest-shares returned from liquidation in ownership interests in subsidiaries Balance at December 31, 2021	Notes				Equityattributable to	Equityattributable to	owners of theparent				Total	Non-controlling interest		Total equity
		Common stock	Total capital surplus, additional paid-in capital		Retained Earnings	Unappropriated retained earnings	O	ther EquityInterest	Gains (losses) on hedging instruments	Treasurystocks
				Legal reserve	Special reserve		Financial statements translation differences of foreign operations	Unrealised gains (losses) from financial assets measured at fair value through other comprehensive income
		$ 58,611,863 - - - - - - - - - - - - - - - $ 58,611,863 $ 58,611,863 - - - - - - - - - - - - - - $ 58,611,863	$ 9,138,869 - - - - - - 4,568 4,420 ( 304) 17,295 2,789 - - - - $ 9,167,637 $ 9,167,637 - - - - - - 442 12,366 11,379 ( 682) 1,857 - - - $ 9,192,999	$ 61,364,852 - - - 2,970,224 - - - - - - - - - - - $ 64,335,076 $ 64,335,076 - - - 1,978,906 - - - - - - - - - - $ 66,313,982	$ 60,171,925 - - - - 6,156,414 - - - - - - - - - - $ 66,328,339 $ 66,328,339 - - - - 3,704,582 - - - - - - - - - $ 70,032,921	$ 64,990,184 19,544,141 404,543 19,948,684 ( 2,970,224 ) ( 6,156,414 ) ( 22,272,508 ) ( 88,768 ) - - - ( 40,929 ) ( 29,924 ) - - - $ 53,380,101 $ 53,380,101 38,359,347 ( 537,510 ) 37,821,837 ( 1,978,906 ) ( 3,704,582 ) ( 14,652,966 ) 2,565 - - - - 1,277,669 - - $ 72,145,718	( $ 4,560,606) - ( 712,000) ( 712,000) - - - - - - - - - - - - ( $ 5,272,606) ( $ 5,272,606) - ( 968,064) ( 968,064) - - - - - - - - - - - ( $ 6,240,670)	$ 107,120,877 - ( 9,139,910) ( 9,139,910) - - - 84,386 - - - - 29,924 - - - $ 98,095,277 $ 98,095,277 - 24,413,358 24,413,358 - - - ( 2,565) - - - - ( 1,277,669) - - $ 121,228,401	$ 659 - 31,464 31,464 - - - - - - - - - - - - $ 32,123 $ 32,123 - ( 22,853 ) ( 22,853 ) - - - - - - - - - - - $ 9,270	( $ 323,952) - - - - - - - - - - - - - - - ( $ 323,952) ( $ 323,952) - - - - - - - - - - - - - - ( $ 323,952)	$ 356,514,671 19,544,141 ( 9,415,903) 10,128,238 - - ( 22,272,508) 186 4,420 ( 304) 17,295 ( 38,140) - - - - $ 344,353,858 $ 344,353,858 38,359,347 22,884,931 61,244,278 - - ( 14,652,966) 442 12,366 11,379 ( 682) 1,857 - - - $ 390,970,532	$ 52,776,292 2,009,568 ( 736,782) 1,272,786 - - - - - - - 4,657 ( 50,555) ( 3,243,752) ( 4,410) 343,653 $ 51,098,671 $ 51,098,671 4,348,084 52,009 4,400,093 - - - - - - - 2,948 175,384 ( 2,550,389) ( 116,285) $ 53,010,422		$ 409,290,963 21,553,709 ( 10,152,685) 11,401,024 - - ( 22,272,508) 186 4,420 ( 304) 17,295 ( 33,483) ( 50,555) ( 3,243,752) ( 4,410) 343,653 $ 395,452,529 $ 395,452,529 42,707,431 22,936,940 65,644,371 - - ( 14,652,966) 442 12,366 11,379 ( 682) 4,805 175,384 ( 2,550,389) ( 116,285) $ 443,980,954

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

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FORMOSA CHEMICALS & FIBRE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Profit from continuing operations before tax Loss from discontinued operations before tax Profit before tax Adjustments Adjustments to reconcile profit (loss) Depreciation Amortisation Net gain on financial assets and liabilities at fair value through profit or loss Interest expense Interest income Dividend income Gain on disposal of investments Share of profit or loss of associates accounted for under the equity method Gain on disposal and scrap of property, plant and equipment Changes in operating assets and liabilities Changes in operating assets Notes receivable Notes receivable-related parties Accounts receivable Accounts receivable-related parties Other receivables Inventories Other current assets Changes in operating liabilities Notes payable Accounts payable Accounts payable-related parties Other payables Other current liabilities Accrued pension liabilities Cash inflow generated from operations Interest received Dividends received Interest paid Income tax paid Net cash flows from operating activities

For the years endedDecember 31 Notes 2021 2020 $ 50,159,895 $ 24,767,687 6(10) - ( 484 ) 50,159,895 24,767,203 6(8)(9)(25) 13,806,835 13,365,687 6(25) 4,185,976 3,669,159 6(23) 91,153 155,552 6(24) 1,048,054 1,293,887 6(21) ( 350,874 ) ( 356,838 ) 6(22) ( 3,116,391 ) ( 5,113,321 ) 6(10) - ( 165 ) ( 12,567,317 ) ( 3,779,946 ) 6(23) ( 4,770 ) ( 692,419 ) 2,711,153 ( 3,985,436 ) ( 4,245 ) 2,135 ( 3,543,472 ) ( 599,651 ) ( 2,764,315 ) ( 817,339 ) ( 149,674 ) 5,213,635 ( 14,152,668 ) 8,221,457 ( 577,192 ) ( 3,962,200 ) 20,178 410 ( 2,041,666 ) ( 437,189 ) 5,318,561 830,574 2,681,152 ( 1,137,950 ) ( 1,843,600 ) 1,274,893 ( 369,793 ) ( 1,264,280 ) 38,536,980 36,647,858 317,257 374,883 5,223,948 12,250,867 ( 1,018,388 ) ( 1,351,231 ) ( 4,330,589 ) ( 1,709,608 ) 38,729,208 46,212,769

(Continued)

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FORMOSA CHEMICALS & FIBRE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM INVESTING ACTIVITIES Decrease in other receivables-related parties Acquisition of financial assets at fair value through profit or loss Acquisition of financial assets at fair value through other comprehensive income Shares returned from reduction in financial assets at fair value through other comprehensive income Proceeds from disposal of financial assets at fair value through other comprehensive income Acquisition of financial assets at amortised cost Acquisition of investments accounted for under the equity method Net cash flows used in disposal of subsidiaries Net cash flows used in acquisition of ownership interests in subsidiaries Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Acquisition of intangible assets Increase in non-current assets Net cash flows used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Decrease in short-term borrowings Increase in short-term notes and bills payable Increase in other payables-related parties Increase in corporate bonds payable Payment of corporate bonds payable Increase in long-term borrowings Payment of long-term borrowings Payment of lease liabilities (Decrease) increase in other non-current liabilities Payment of cash dividends Payment of expired cash dividends reclassified to capital surplus Payment of cash dividends - non-controlling interest Shares returned from liquidation - non-controlling interest Net cash flows used in financing activities Effect of foreign exchange translations Net increase in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year

For the years endedDecember 31 Notes 2021 2020 $ 1,496,905 $ 8,603,238 ( 106,598 ) - ( 247,511 ) ( 55,400 ) - 14,810 2,026,251 518 ( 2,962,890 ) ( 1,380,524 ) ( 936,281 ) ( 2,664,942 ) 6(30) - ( 23,556 ) 6(29) - ( 66,160 ) 6(30) ( 16,152,196 ) ( 15,681,770 ) 24,546 998,237 ( 3,063 ) ( 2,623 ) ( 7,294,922 ) ( 3,298,078 ) ( 24,155,759 ) ( 13,556,250 ) ( 1,542,746 ) ( 13,314,003 ) 1,699,892 1,700,363 10,205 531,808 10,000,000 10,000,000 ( 2,050,000 ) ( 2,750,000 ) 12,024,670 14,752,685 ( 10,955,608 ) ( 16,228,492 ) ( 181,506 ) ( 178,039 ) ( 10,310 ) 2,058 6(30) ( 14,657,452 ) ( 22,267,479 ) ( 682 ) ( 304 ) ( 2,551,250 ) ( 3,243,752 ) ( 116,285 ) - ( 8,331,072 ) ( 30,995,155 ) ( 307,407 ) 366,511 5,934,970 2,027,875 17,127,127 15,099,252 $ 23,062,097 $ 17,127,127

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

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FORMOSA CHEMICALS & FIBRE CORPORATION AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

1. History and Organization

Formosa Chemicals & Fibre Corporation (the ‘‘Company”) was founded on March 5, 1965. The Company and its subsidiaries (together referred herein as the “Group”) now has eight business divisions, namely First Chemical Division, Petrochemicals Division, Third Chemical Division, Plastics Division, Textile Division, First Fiber Division and its subsidiaries, Second Fiber Division, and Engineering & Construction Division. The Group’s major businesses are production and sales of petrochemical products, including PTA, PS, AN, Butadiene, SM polymer, SM, benzene, toluene, p-xylene (PX) and o-xylene (OX), as well as nylon fiber, and rayon staple fiber. The Group is also engaged in spinning, weaving, dyeing and finishing.

1. The Date of Authorisation for Issuance of the Financial Statements and Procedures for Authorisation

These consolidated financial statements were authorised for issuance by the Board of Directors on March 9, 2022.

3. Application of New Standards, Amendments and Interpretations

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

New standards, interpretations and amendments as endorsed by the FSC effective from 2021 are as follows:

follows:
New Standards, Interpretations and Amendments	Effective date by International Accounting Standards Board
Amendments to IFRS 4, ‘Extension of the temporary exemption from applyingIFRS 9’	January 1, 2021
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, ‘Interest Rate Benchmark Reform—Phase 2’	January 1, 2021
Amendment to IFRS 16, ‘Covid-19-related rent concessions beyond 30 June 2021’	April 1, 2021 (Note)

Note: Earlier application from January 1, 2021 is allowed by the 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.

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

the Group

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

==> picture [483 x 123] intentionally omitted <==

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

Effective date by
International Accounting
New Standards, Interpretations and Amendments Standards Board
Amendments to IFRS 3, ‘Reference to the conceptual framework’ January 1, 2022
Amendments to IAS 16, ‘Property, plant and equipment: proceeds before January 1, 2022
intended use’
Amendments to IAS 37, ‘Onerous contracts—cost of fulfilling a contract’ January 1, 2022
Annual improvements to IFRS Standards 2018–2020 January 1, 2022
----- End of picture text -----

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 213] intentionally omitted <==

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

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

The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment. The quantitative impact will be disclosed when the assessment is complete.

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.

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(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”, International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the FSC (collectively referred herein as the “IFRSs”).

(2) Basis of preparation

• A. Except for the following items, the 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 recognised based on the net amount of pension fund assets less present value of defined benefit obligation.

• B. The preparation of financial statements in conformity with IFRSs requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement 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 (including structured entities) controlled by the Group. The Group controls an entity when the Group is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Consolidation of subsidiaries begins from the date the Group obtains control of the subsidiaries and ceases when the Group loses control of the subsidiaries.

• (b) Inter-company transactions, balances and unrealised 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 recognised directly in equity.

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• (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 recognised in profit or loss. All amounts previously recognised 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 recognised 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.

B. Subsidiaries included in the consolidated financial statements:

Name of investor	Name of subsidiary	Main business activities Spinning, dyeing, printing, finishing and manufacturing synthetic fibre, rug and carpet Investing Manufacturing and sale of cleaner and cosmetics Spinning Wholesale and retail of petrochemical and plastic raw materials Chemistry, international trade of petrochemistry Hydropower Production and marketing of textile, polyester staple fibre, cotton,	December31,2021 December31,2020 100.00 100.00 100.00 100.00 88.59 88.59 - 86.40 50.00 50.00 50.00 50.00 51.00 51.00 42.50 42.50 Ownership (%)	Description
			December31,2021 100.00 100.00 88.59 - 50.00 50.00 51.00 42.50
The Company The Company The Company The Company The Company The Company The Company The Company	Formosa FCFC Carpet Corp. FCFC Investment Corp. (Cayman) Formosa Biomedical Technology Corp. Tah Shin Spinning Corp. Formosa Idemitsu Petrochemical Corp. Formosa INEOS Chemicals Corp. Chia-Nan Enterprise Corp. Formosa Industries Corp., Vietnam			The Company holds more than 50% of voting rights. The Company holds more than 50% of voting rights. The Company holds more than 50% of voting rights. The Company holds more than 50% of voting rights. (Note 1) The Company has substantial control and thus regards Formosa Idemitsu Petrochemical Corp. as a subsidiary. The Company has substantial control and thus regards Formosa INEOS Chemicals Corp. as a subsidiary. The Company holds more than 50% of voting rights. (Note 2) The Company has substantial control and thus regards Formosa Industries Corp. as a subsidiary.

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Name of investor	Name of subsidiary	Main business activities Production and marketing of Polyamine fabric, Polyester fabric, cotton fabric, blended fabric and tire cord fabric Cogeneration power generation business Investing Producing and marketing of PTA、PS、 ABS、Phenol Removal and disposal of waste Investment Manufacturing industrial catalyst and wholesale of other chemical products Manufacturing and sale of battery energy storage systems and related products	December31,2021 December31,2020 37.40 37.40 100.00 100.00 100.00 100.00 100.00 100.00 71.00 71.00 100.00 100.00 57.00 57.00 51.00 51.00 Ownership (%)	Description
			December31,2021 37.40 100.00 100.00 100.00 71.00 100.00 57.00 51.00
The Company FCFC Investment Corp. (Cayman) FCFC Investment Corp. (Cayman) Formosa Chemicals & Fibre (Hong Kong) Co., Ltd. Formosa Biomedical Technology Corp. Formosa Biomedical Technology Corp. Formosa Biomedical Technology Corp. Formosa Biomedical Technology Corp.	Formosa Taffeta Co., Ltd. Formosa Power (Ningbo) Co., Ltd. Formosa Chemicals & Fibre (Hong Kong) Co., Ltd. Formosa Chemicals Industries (Ningbo) Co., Ltd. Hong Jing Resources Corp. Formosa Biomedical Technology (SAMOA) Co., Ltd Formosa Waters Technology Co., Ltd Formosa Bio & Energy Corp. (Japan)			The Company has substantial control and thus regards Formosa Taffeta Corp. as a subsidiary. The company holds more than 50% of voting rights through wholly- owned company - FCFC Investment Corp. (Cayman). The company holds more than 50% of voting rights through wholly- owned company - FCFC Investment Corp. (Cayman). The company holds more than 50% of voting rights through wholly- owned company - FCFC Investment Corp. (Hong Kong). The Company holds more than 50% of voting rights through an 88.59% voting rights owned company - Formosa Biochemical Technology Corp. Formosa Biochemical Technology holds more than 50% of voting rights. Formosa Biochemical Technology holds more than 50% of voting rights. Formosa Biochemical Technology holds more than 50% of voting rights.

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Name of investor	Name of subsidiary	Main business activities Importing, exporting and wholesale of heatlhy food Production of cotton, Terylene greige cloth, coloured cloth and textured processing yarn products Production and marketing of textile, polyester staple fibre, cotton, hydropower Assembly, testing, model processing and research and development of various integrated circuits Sale of hi-tech performance fabric of 3XDRY, Nanosphere, Keprotec, Dynatec, Spirit and Reflex Manufacturing of nylon and polyester filament products Manufacturing of processing fabric of nylon filament knitted cloth, weaving and dyeing as well as post processing of knitted fabric Employment services and temporary worker services	December31,2021 December31,2020 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 Ownership (%)	Description
			December31,2021 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
Formosa Biomedical Technology (SAMOA) Co., Ltd Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta (Hong Kong) Co., Ltd. Formosa Development Co., Ltd.	Formosa Biomedical Trading (Shanghai) Co., Ltd. Formosa Taffeta (Zhong Shan) Co.,Ltd. Formosa Taffeta (Vietnam) Co., Ltd. Formosa Development Co., Ltd. Schoeller F.T.C. (Hong Kong) Co., Ltd. Formosa Taffeta (Dong Nai) Co., Ltd. Formosa Taffeta (Changshu) Co., Ltd. Public More Internation Co., Ltd.			Formosa Biochemical Technology holds more than 50% of voting rights through a 100% owned company- Formosa Biomedical Technology (SAMOA) Co., Ltd. Formosa Taffeta Co., Ltd. holds more than 50% of voting rights. Formosa Taffeta Co., Ltd. holds more than 50% of voting rights. Formosa Taffeta Co., Ltd. holds more than 50% of voting rights. Formosa Taffeta Co., Ltd. holds more than 50% of voting rights. Formosa Taffeta Co., Ltd. holds more than 50% of voting rights. Formosa Taffeta Co., Ltd. holds more than 50% of voting rights through a 100% owned company - Formosa Taffeta (Hong Kong) Co., Ltd. Formosa Taffeta Co., Ltd. holds more than 50% of voting rights through a 100% owned company - Formosa Development Co., Ltd.

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• Note 1: On August 25, 2020, Tah Shin Spinning Corporation has implemented the liquidation procedure, and the dissolution and liquidation were completed on July 6, 2021.

• Note 2: On September 24, 2020, the Company acquired an additional 21% equity interest in ChiaNan Enterprise Corp. for a total cash consideration of $145,527. The Company’s shareholding ratio reached 51% and obtained control over it. After the acquisition of additional equity interest, it was reclassified from ‘investment accounted for using equity method’ to a consolidated subsidiary.

• 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 interests that are material to the Group: As of December 31, 2021 and 2020, the non-controlling interest amounted to $53,010,422 and $51,098,671, respectively. The information on non-controlling interest and respective subsidiary is as follows:

s follows:
Name of subsidiary Formosa Taffeta Co., Ltd.	Principal place of business Taiwan	Non-controlling interest
		Ownership Amount (%) 38,800,031 $ 62.60 December31,2021	December31,2020
		Amount 38,800,031 $	Ownership Amount (%) 38,398,022 $ 62.60

Summarised financial information of the subsidiary:

Balance sheets

Balance sheets
			Formosa Taffeta Co.,Ltd.
			December 31,2021		December 31, 2020
Current assets		$	17,693,888	$	15,579,258
Non-current assets			63,648,300		63,882,800
Current liabilities	(		7,905,048)	(	7,666,097)
Non-current liabilities	(		11,193,281)	(	10,312,373)
Total net assets		$	62,243,859	$	61,483,588

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Statements of comprehensive income

Statements of comprehensive income
		Formosa Taffeta		Co.,Ltd.
		Year ended		Year ended
		December31,2021		December31,2020
Revenue		32,799,007 $	$	28,783,492
Profit before income tax		2,387,355		2,262,562
Income tax expense	(	244,188)	(	166,772)
Profit for the year from continuing
operations		2,143,167		2,095,790
Loss from discontinued operations		-	(	484)
Profit for the year		2,143,167		2,095,306
Other comprehensive income (loss),
net of tax		297,081	(	626,986)
Total comprehensive income for the year		2,440,248 $	$	1,468,320
Comprehensive loss attributable to non-
controlling interest		- $	($	242)

Statements of cash flows

Statements of cash flows
			FormosaTaffeta Co.,Ltd.
			Year ended	Year ended
			December31,2021	December	31,2020
Net cash provided by operating activities		$	2,433,092	$	4,218,754
Net cash used in investing activities	(		689,510)	(	2,488,305)
Net cash used in financing activities	(		1,333,856)	(	1,910,683)
Effect of exchange rates on cash and cash
equivalents	(		21,907)		26,932
Increase (decrease) in cash and
cash equivalents			387,819	(	153,302)
Cash and cash equivalents, beginning of year			3,083,322		3,236,624
Cash and cash equivalents, end of year		$	3,471,141	$	3,083,322

(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 recognised in profit or loss in the period in which they arise.

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• (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 recognised 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 recognised in profit or loss. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through other comprehensive income are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognised in other comprehensive income. However, nonmonetary assets and liabilities denominated in foreign currencies that are not measured at fair value are translated using the historical exchange rates at the dates of the initial transactions.

• (d) All foreign exchange gains and losses 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, associates and jointly controlled entities that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

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

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

  • iii. All resulting exchange differences are recognised in other comprehensive income.

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

(5) Classification of current and non-current items

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

• (a) Assets arising from operating activities that are expected to be realised, 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 realised 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 settle liabilities more than twelve months after the balance sheet date.

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• 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 amortised cost

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

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

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

• B. On a regular way purchase or sale basis, financial assets at amortised cost are recognised and derecognised using trade date accounting.

• C. At initial recognition, the Group measures the financial assets at fair value plus transaction costs. Interest income from these financial assets is included in finance income using the effective interest method. A gain or loss is recognised in profit or loss when the asset is derecognised or impaired.

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

• (8) 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. Financial assets at amortised cost or fair value through other comprehensive income are designated as at fair value through profit or loss at initial recognition when they eliminate or significantly reduce a measurement or recognition inconsistency.

• B. On a regular way purchase or sale basis, financial assets at fair value through profit or loss are recognised and derecognised using trade date accounting.

• C. At initial recognition, the Group measures the financial assets at fair value and recognises the transaction costs in profit or loss. The Group subsequently measures the financial assets at fair value, and recognises the gain or loss in profit or loss.

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• 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.

• (9) 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 Group has made an irrevocable election at initial recognition to recognise changes in fair value in other comprehensive income and debt instruments which meet all of the following criteria:

• (a) The objective of the Group’s business model is achieved both by collecting contractual cash flows and selling financial assets; and

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

• 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:

• (a) 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 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.

• (b) Except for the recognition of impairment loss, interest income and gain or loss on foreign exchange which are recognised in profit or loss, the changes in fair value of debt instruments are taken through other comprehensive income. When the financial asset is derecognised, the cumulative gain or loss previously recognised in other comprehensive income is reclassified from equity to profit or loss.

• (10) 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.

• (11) Impairment of financial assets

• For accounts receivable or contract assets that have a significant financing component, 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 or contract assets that do not contain a significant financing component, the Group recognises the impairment provision for lifetime ECLs.

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(12) Derecognition of financial assets

The Group derecognises a financial asset when one of the following conditions is met:

• A. The contractual rights to receive the cash flows from the financial asset expire.

• B. The contractual rights to receive cash flows of the financial asset have been transferred and the Group has transferred substantially all risks and rewards of ownership of the financial asset.

• C. The contractual rights to receive cash flows of the financial asset have been transferred and the Group has not retained control of the financial asset.

(13) Inventories

Inventories are stated at the lower of cost and net realisable value. Cost is determined using the weighted-average method. The cost of finished goods and work in process comprises raw materials, direct labor, other direct costs and related production overheads (allocated based on normal operating capacity). It excludes borrowing costs. The item by item approach is used in applying the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and applicable variable selling expenses.

(14) Investments accounted for using equity method /associates

• A. Associates are all entities over which the Group has significant influence but not 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 recognised at cost.

• B. The Group’s share of its associates’ post-acquisition profits or losses is recognised in profit or loss, and its share of post-acquisition movements in other comprehensive income is recognised 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 recognise 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 do not arise from profit or loss or other comprehensive income of the associate and such changes do not affect the Group’s ownership percentage of the associate, the Group recognises the Group’s share of change in equity of the associate in ‘capital surplus’ in proportion to its ownership.

• D. Unrealised gains on transactions between the Group and its associates are eliminated to the extent of the Group’s interest in the associates. Unrealised 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.

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• 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 recognised 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 recognised in profit or loss.

• G. When the Group disposes its investment in an associate and loses significant influence over this associate, the amounts previously recognised 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 retains significant influence over this associate, the amounts previously recognised 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 and loses significant influence over this associate, the amounts previously recognised as capital surplus in relation to the associate are transferred to profit or loss. If it retains significant influence over this associate, the amounts previously recognised as capital surplus in relation to the associate are transferred to profit or loss proportionately.

(15) Property, plant and equipment

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

• B. Subsequent costs are included in the asset’s carrying amount or recognised 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 derecognised. 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.

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

Land improvements 3 ~ 15 years Buildings 10 ~ 60 years Machinery and equipment 5 ~ 15 years Transportation equipment 3 ~ 15 years Other equipment 2 ~ 15 years

• (16) 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;

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

  • (d) The exercise price of a purchase option, if the lessee is reasonably certain to exercise that option; and

  • (e) 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.

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• 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.

• D. For lease modifications that decrease the scope of the lease, the lessee shall decrease the carrying amount of the right-of-use asset to reflect the partial or full termination of the lease, and recognise the difference between remeasured lease liability in profit or loss.

• (17) Intangible assets

• Computer software is stated at cost and amortised on a straight-line basis over its estimated useful life.

(18) Impairment of non-financial assets

The Group assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. When the circumstances or reasons for recognising 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 recognised.

• (19) Borrowings

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

(20) 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.

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

(22) Bonds payable

Ordinary corporate bonds issued by the Group are initially recognised at fair value less transaction costs. Any difference between the proceeds (net of transaction costs) and the redemption value is presented as an addition to or deduction from bonds payable, which is amortised to profit or loss over the period of bond circulation using the effective interest method as an adjustment to ‘finance costs’.

(23) Derecognition of financial liabilities

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

(24) Offsetting financial instruments

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

(25) Non-hedging derivatives

Non-hedging derivatives are initially recognised at fair value on the date a derivative contract is entered into and recorded as financial assets or financial liabilities at fair value through profit or loss. They are subsequently remeasured at fair value and the gains or losses are recognised in profit or loss.

(26) 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 recognised as expense in that period when the employees render service.

• B. Pensions

(a) Defined contribution plans

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

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  - (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 recognised in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The net defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The rate used to discount is determined by using interest rates of 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. Remeasurements arising on defined benefit plans are recognised in other comprehensive income in the period in which they arise and are recorded as other equity.

  - iii. Past service costs are recognised immediately in profit or loss.

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

  • Employees’ remuneration and directors’ and supervisors’ remuneration are recognised as expense and liability, provided that such recognition is required under legal or constructive obligation and those amounts can be reliably estimated. Any difference between the resolved amounts and the subsequently actual distributed amounts is accounted for as changes in estimates.

• (27) Income tax

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

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

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• C. Deferred income tax is recognised, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated balance sheet. However, the deferred 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 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 recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised. At each balance sheet date, unrecognised and recognised 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 recognised amounts and there is an intention to settle on a net basis or realise 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 realise the asset and settle the liability simultaneously.

• F. A deferred tax asset shall be recognised for the carryforward of unused tax credits resulting from acquisitions of equipment or technology and equity investments to the extent that it is possible that future taxable profit will be available against which the unused tax credits can be utilised.

(28) Treasury shares

• 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.

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(30) Revenue recognition

Sales of goods

• A. The Group manufactures and sells a variety of petrochemical products, including the spinning, weaving, dyeing and finishing of rayon and nylon fiber. Sales are recognised when control of the products has transferred, being when the products are delivered to the customer, the customer 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.

• B. The amount of sales revenue recognised is equal to the contract price net of volume discounts and sales discounts and allowances. Volume discounts and sales discounts and allowances are estimated based on historical information, and a refund liability is recognised for expected volume discounts and sales discounts and allowances payable to customers in relation to sales made until the end of the reporting period. The sales usually are made with a credit term of 30 to 120 days. As the time interval between the transfer of committed goods or service and the payment of customer does not exceed one year, the Group does not adjust the transaction price to reflect the time value of money.

• C. A receivable is 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.

(31) Operating segments

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

1. Critical Accounting Judgements, Estimates and Key Sources of Assumption Uncertainty

2. 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. The information is addressed below:

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

None.

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(2) Critical accounting estimates and assumptions

• A. Impairment assessment of accounts receivable

In the process of assessing impairment of accounts receivable, the Group must use judgements and assumptions to determine the collectability of accounts receivable. The collectability is affected by various factors: customers’ financial conditions, the Group’s internal credit ratings, historical experience, etc. When sales are not expected to be collected, the Group recognises a specific allowance for doubtful receivables after the assessment. The assumptions and estimates of loss allowance provided for accounts receivable are based on concerning future events as that on the balance sheet date. Assumptions and estimates may differ from the actual results which may result in material adjustments.

• B. Evaluation of inventories

• As inventories are stated at the lower of cost and net realisable value, the Group must determine the net realisable value of inventories on balance sheet date using judgements and estimates. Due to the rapid technology innovation, the Group evaluates the amounts of normal inventory consumption, obsolete inventories or inventories without market selling value on balance sheet date, and writes down the cost of inventories to the net realisable 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 December 31, 2021, the carrying amount of inventories was $47,200,475.

1. 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 Cash equivalents Time deposits Bonds repurchased and commercial paper	December31,2021 94,367 $ 6,700,501 8,760,277 7,506,952 23,062,097 $	December31,2020
		62,263 $ 5,889,654 5,769,053 5,406,157
		17,127,127 $

• A. The Group transacts with a variety of financial institutions all with high credit quality to disperse credit risk, so it expects that the probability of counterparty default is remote. Loss allowance is measured using 12-month expected credit losses. For the years ended December 31, 2021 and 2020, the Group did not recognise any loss allowance.

• B. As of December 31, 2021, the capital repatriated by the Group amounting to USD 44,221 thousand (equivalent to $1,224,497) that failed to meet the definition of cash and cash equivalents under the IAS 7, ‘Statement of Cash Flows’ due to the restrictions under “The Management, Utilisation, and Taxation of Repatriated Offshore Funds Act” was classified as other financial assets, and listed under other non-current assets.

• C. The Group has no cash and cash equivalents pledged to others.

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

Items			December31,2021			December31,2020
Financial assets mandatorily measured at fair
value through profit or loss
Fund		$	4,191,897		$	4,085,299
Derivatives			-			82
			4,191,897			4,085,381
Valuation adjustments	(		287,997)	(		196,789)
		$	3,903,900		$	3,888,592

• A. Amounts recognised in profit or loss in relation to financial assets at fair value through profit or loss are listed below:

loss are listed below:
		For the year ended		For the year ended
		December31,2021		December31,2020
Financial assets mandatorily measured
at fair value through profit or loss
Fund	($	91,208)	($	155,458)
Derivatives	(	82)	(	37)
	($	91,290)	($	155,495)

• B. The Group entered into contracts relating to derivative financial assets which were not accounted for under hedge accounting. The information is listed below: December 31, 2021: None.

for under hedge accounting. The information is listed below: December 31, 2021: None.
Derivative Instruments Forward exchange contracts: Taipei Fubon	December31,2020
	Contract Amount (Notional Principal) (in thousands) Contract Period USD 415 December 2020 - January 2021

The forward exchange contracts are buy and sell to hedge the change of exchange rate due to import and export transactions, but not adopting hedge accounting.

• C. Information relating to credit risk is provided in Note 12(3).

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

Current items: Equity instruments Listed stocks Unlisted stocks Valuation adjustment Non-current items: Equity instruments Listed stocks Unlisted stocks Valuation adjustment	December 31,2021 24,450,527 $ 825,839 91,175,357 116,451,723 $ 8,410,475 $ 27,038,367 37,550,424 72,999,266 $	December 31,2020 24,450,527 $ 825,839 84,213,105 109,489,471 $ 8,163,125 $ 27,567,844 23,890,639
		59,621,608 $

• A. The Group has elected to classify equity securities investments that are considered to be steady dividend income as financial assets at fair value through other comprehensive income. The fair value of such investments amounted to $189,450,989 and $169,111,079 as at December 31, 2021 and 2020, respectively.

• B. Amounts recognised in profit or loss and other comprehensive income in relation to the financial assets at fair value through other comprehensive income are listed below:

For the year ended For the year ended December 31, 2021 December 31, 2020

Equity instruments at fair value through other comprehensive income Fair value change recognised in other comprehensive income $ 21,961,032 ($ 8,423,056) Cumulative (losses) gains reclassified to retained earnings due to derecognition (including loss included in noncontrolling interest) ($ 1,455,618) $ 164,865

• C. As at December 31, 2021 and 2020, without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the financial assets at fair value through other comprehensive income held by the Group were $189,450,989 and $169,111,079, respectively.

• D. Information relating to credit risk of financial assets at fair value through other comprehensive income is provided in Note 12(3).

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(4) Financial assets at amortised cost

Financial assets at amortised cost
Items Current items: Time deposits with original maturity date of more than three months Non-current items: Time deposits with original maturity date of more than one year	December31,2021 1,953,235 $ 2,390,179 $	December31,2020
		1,116,878 $
		263,646 $

• A. Amounts recognised in profit or loss in relation to financial assets at amortised cost are listed below:

below:
Interest income	For the year ended December31,2021 49,941 $	For the year ended December31,2020
		17,003 $

• B. As at December 31, 2021 and 2020, without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the financial assets at amortised cost held by the Group were $4,343,414 and $1,380,524, respectively.

• C. Details of the Group’s financial assets at amortised cost pledged to others as collateral are provided in Note 8.

• D. Information relating to credit risk of financial assets at amortised cost is provided in Note 12(3).

(5) Notes and accounts receivable

Notes and accounts receivable
			December 31, 2021			December31,2020
Notes receivable		$	8,173,238		$	10,884,391
Less: Allowance for uncollectible accounts			-			-
		$	8,173,238		$	10,884,391
Notes receivable - related parties		$	8,505		$	4,260
Accounts receivable		$	20,360,034		$	16,816,918
Less: Allowance for uncollectible accounts	(		155,526)	(		155,882)
		$	20,204,508		$	16,661,036
Accounts receivable - related parties		$	8,719,009		$	5,954,694

Accounts receivable - related parties

• A. As of December 31, 2021 and 2020, accounts receivable and notes receivable were all from contracts with customers. As of January 1, 2020, the balance of receivables from contracts with customers amounted to $28,378,198.

• B. As of December 31, 2021 and 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 Group’s notes and accounts receivable were $8,181,743 and $10,888,651, and accounts receivable were $28,923,517 and $22,615,730, respectively.

• C. Information relating to credit risk is provided in Note 12(3).

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(6) Inventories

				December31,2021	December31,2021
					Allowance for
		Cost			valuation loss		Book value
Raw materials	$	18,034,135	($		172,360)	$	17,861,775
Materials		7,659,515	(		550,862)		7,108,653
Work in progress		6,385,669	(		182,162)		6,203,507
Finished goods		16,596,245	(		849,338)		15,746,907
Inventory in transit		279,633			-		279,633
	$	48,955,197	($		1,754,722)	$	47,200,475

Raw materials Materials Work in progress Finished goods Inventory in transit		December31,2020
	Cost 10,913,335 $ 7,648,298 4,734,040 11,162,332 113,305 34,571,310 $	Allowance for valuation loss 103,825) ($ 567,218) ( 5,450) ( 846,920) ( 90) ( 1,523,503) ($	Book value
			10,809,510 $ 7,081,080 4,728,590 10,315,412 113,215
			33,047,807 $

• A. Expense and loss incurred on inventories for the years ended December 31, 2021 and 2020 were as follows:

as follows:
Cost of inventories sold Loss (gain) on inventory valuation (Note) Idle capacity (including annual survey and work stoppage) Others Less: Operating cost from discontinued operations	Forthe years endedDecember31,
	2021 2020 310,560,643 $ 221,534,682 $ 231,419 254,573) ( 1,195,305 1,789,759 386,359 705,097 312,373,726 223,774,965 - 12,365) ( 312,373,726 $ 223,762,600 $	2020
		223,762,600 $

Note: As the market value of petroleum related products decreased for the year ended December 31, 2021, the Group recognised related allowance for inventory valuation loss after assessment. For the year ended December 31, 2020, disposal of excess inventory resulted in gain from price recovery of inventory.

B. As of December 31, 2021 and 2020, inventories pledged are described in Note 8.

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(7) Investments accounted for using equity method

Investments accounted for using equity method
. Formosa Heavy Industries Corp. Formosa Fairway Corp. Formosa Plastics Transport Corp. Formosa Petrochemical Corp. Mai Liao Power Corp. Hwa Ya Science Park Management Consulting Co., Ltd. Formosa Environmental Technology Corp. Formosa Synthetic Rubber Corp. (Hong Kong) Formosa Resources Corp. Formosa Group (Cayman) Corp. Formosa Construction Corp. Guo Su Plastic Industry Co., Ltd. FG INC. Beyoung International Corp. Formosa Advanced Technologies Co., Ltd. Nan Ya Optical Corp. Kuang Yueh Co., Ltd. Changshu Yu Yuan Co., Ltd. Schoeller Textil AG	December31,2021 7,694,115 $ 49,214 1,250,682 86,080,723 12,819,210 3,195 228,831 2,182,064 6,860,325 662,099 593,734 48,469 3,335,242 95,492 5,152,935 290,161 1,238,353 17,480 1,030,378 129,632,702 $	December31,2020
		7,102,774 $ 68,247 1,177,559 74,133,567 12,414,449 3,029 227,350 2,308,051 6,169,287 649,229 568,354 - 3,458,577 94,328 5,003,040 196,554 1,167,551 16,483 1,270,603
		116,029,032 $

A. Associates

(a) The basic information of the associate that is material to the Group is as follows:

Company name	Principal place of business	Shareholdingratio	Shareholdingratio	Nature of relationship	Method of measurement
		December 31, 2021	December 31, 2020
Formosa Petrochemical Corp.	Taiwan	24.15%	24.15%	Investments accounted for using equity method	Equity method

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• (b) The summarised financial information of the associate that is material to the Group is shown below:

Balance sheets

==> picture [454 x 197] intentionally omitted <==

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

Formosa Petrochemical Corp.
. December 31, 2021 December 31, 2020
Current assets $ 286,706,644 $ 212,621,640
Non-current assets 162,099,170 157,332,180
Current liabilities ( 56,639,797) ( 27,677,805)
Non-current liabilities ( 34,751,549) ( 34,174,656)
Total net assets $ 357,414,468 $ 308,101,359
Share in associate's net assets $ 86,315,594 $ 74,406,478
Unrealised loss from sale of
upstream transactions eliminations ( 124,152) ( 162,192)
Net differences in share capital ( 110,719) ( 110,719)
Carrying amount of the associate $ 86,080,723 $ 74,133,567
----- End of picture text -----

Statements of comprehensive income

Statements of comprehensive income
Revenue Profit for the year from continuing operations Other comprehensive income (loss), net of tax Total comprehensive income Dividends received from associates	Formosa Petrochemical Corp.
	For the year ended For the year ended December31,2021 December 31, 2020 617,439,029 $ 413,042,534 $ 49,401,403 $ 7,429,610 $ 5,530,189 1,926,787) ( 54,931,592 $ 5,502,823 $ 1,357,472 $ 6,672,319 $

• (c) 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 December 31, 2021 and 2020, the carrying amount of the Group’s individually immaterial associates amounted to $43,551,979 and $41,895,465, respectively.

Profit for the year from continuing operations Other comprehensive income (loss), net of tax Total comprehensive income	For the year ended For the year ended December31,2021 December31,2020 2,921,400 $ 8,593,673 $ 3,782,065 3,730,255) ( 6,703,465 $ 4,863,418 $

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• (d) The fair value of the Group’s associates which have quoted market price was as follows:

		December 31,2021		December 31,2020
Formosa Petrochemical Corp.	$	220,646,701	$	229,619,820
Kuang Yueh Co., Ltd.		2,427,998		2,009,378
Formosa Advanced Technologies Co., Ltd.		5,323,699		5,146,696
	$	228,398,398	$	236,775,894

• B. The investments accounted for using equity method were based on the investees’ audited financial statements for the years ended December 31, 2021 and 2020.

• C. On December 8, 2021, the competent authority of the Group resolved to invest $48,468 in Guo Su Plastic Industry Co., Ltd., and the shareholding ratio was 32.89%.

• D. On August 8, 2019, the Board of Directors of the Company resolved to increase its investment in the reinvested company, Formosa Resources Corp. The Company participated in the capital increase proportionately to its shareholding ratio, 25%, in the amount of USD 81,250 thousand. The actual investments were USD 31,250 thousand and USD 50,000 thousand on March 10, 2021 and August 19, 2019, respectively.

• E. On November 6, 2020, the Board of Directors of the Group resolved to increase its investment in Formosa Construction Corporation in the amount of $500,000, and the shareholding ratio was 33.33%.

• F. After the Group acquired an additional equity interest in Chia-Nan Enterprise Corp. on September 24, 2020, Chia-Nan Enterprise Corp. became the Group’s consolidated subsidiary. Details are provided in Note 4(3).

• G. On October 17, 2019, the Board of Directors of Formosa Taffeta Co., Ltd. resolved to increase its investment in Schoeller Textil AG, in the amount of CHF 39,580 thousand, for a 50% equity interest on March 18, 2020. Formosa Taffeta Co., Ltd. has significant influence but not control over Schoeller Textil AG, so the Group uses equity method for valuation.

• H. In August 2020, the Group’s subsidiary, Formosa Taffeta Co., Ltd., increased its capital in Nan Ya Optical Corp. amounting to $66,938 thousand. Formosa Taffeta Co., Ltd.’s shareholding ratio increased to 15.22% and became a director of the investee. Based on the assessment, Formosa Taffeta Co., Ltd. has significant influence over the investee’s management decisions, so the Group reclassified the investment from financial assets at fair value through other comprehensive income to investments accounted for using equity method.

• I. The Board of Directors resolved to invest USD 27,060 thousand and USD 24,750 thousand, equivalent to 33% ownership, in FG INC. on March 13, 2020 and March 15, 2019, respectively.

• J. On December 13, 2019, the Board of Directors resolved to increase its capital in Formosa Synthetic Rubber Corp. amounting to USD 46,000 thousand, equivalent to a 33.33% equity interest. On April 10, 2020, the shareholders of Formosa Synthetic Rubber Corp. during their meeting resolved to go into liquidation, and the liquidation was completed on December 28, 2020.

~41~

• K. As of December 31, 2021 and 2020, no equity investments held by the Group were pledged to others.

(8) Property, plant and equipment

								Transportation	Transportation	Construction in	Construction in
									equipment		progress and
		Land and land					Machinery		and other		equipment to
.		improvements			Buildings	and equipment			equipment		be inspected		Total
At January 1, 2021
Cost	$		11,999,807	$	47,810,013	$	294,135,290	$	11,786,257	$	27,267,912	$	392,999,279
Accumulated
depreciation
and impairment	(		166,627)	(	27,634,688)	(	228,341,490)	(	9,587,514)		-	(	265,730,319)
	$		11,833,180	$	20,175,325	$	65,793,800	$	2,198,743	$	27,267,912	$	127,268,960
2021
Opening net
book amount	$		11,833,180	$	20,175,325	$	65,793,800	$	2,198,743	$	27,267,912	$	127,268,960
Additions			-		370,010		1,024,873		212,096		15,946,184		17,553,163
Disposals	(		2,170)	(	433)	(	10,795)	(	4,789)		-	(	18,187)
Reclassifications			-		1,062,527		18,401,573		296,028	(	19,510,520)		249,608
Depreciation
charge			-	(	1,520,557)	(	11,626,065)	(	450,776)		-	(	13,597,398)
Net exchange
differences	(		7)	(	138,722)	(	339,612)	(	8,687)	(	71,317)	(	558,345)
Closing net
book amount	$		11,831,003	$	19,948,150	$	73,243,774	$	2,242,615	$	23,632,259	$	130,897,801
At December 31, 2021
Cost	$		11,997,565	$	48,940,796	$	311,142,989	$	11,818,294	$	23,632,259	$	407,531,903
Accumulated
depreciation
and impairment	(		166,562)	(	28,992,646)	(	237,899,215)	(	9,575,679)		-	(	276,634,102)
	$		11,831,003	$	19,948,150	$	73,243,774	$	2,242,615	$	23,632,259	$	130,897,801

~42~

==> picture [487 x 492] intentionally omitted <==

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

Transportation Construction in
equipment progress and
Land and land Machinery and other equipment to
. improvements Buildings and equipment equipment be inspected Total
At January 1, 2020
Cost $ 12,006,023 $ 47,389,611 $ 287,677,051 $ 11,160,902 $ 20,151,498 $ 378,385,085
Accumulated
depreciation
and impairment ( 169,272) ( 26,239,546) ( 218,163,656) ( 9,141,559) - ( 253,714,033)
$ 11,836,751 $ 21,150,065 $ 69,513,395 $ 2,019,343 $ 20,151,498 $ 124,671,052
2020
Opening net
book amount $ 11,836,751 $ 21,150,065 $ 69,513,395 $ 2,019,343 $ 20,151,498 $ 124,671,052
Additions - - 258,782 97,413 15,543,097 15,899,292
Effect of changes
in consolidated
subsidiary 5,206 283,483 253,820 78,018 19,677 640,204
Disposals ( 8,793) ( 61,606) ( 229,109) ( 6,286) ( 25) ( 305,819)
Reclassifications - 700,064 7,670,506 402,012 ( 8,559,877) 212,705
Depreciation
- -
charge ( 1,578,272) ( 11,204,078) ( 377,894) ( 13,160,244)
Disposals-
discontinued
- - - -
operations ( 14) ( 14)
Net exchange
differences 16 ( 318,409) ( 469,516) ( 13,849) 113,542 ( 688,216)
Closing net
book amount $ 11,833,180 $ 20,175,325 $ 65,793,800 $ 2,198,743 $ 27,267,912 $ 127,268,960
At December 31, 2020
Cost $ 11,999,807 $ 47,810,013 $ 294,135,290 $ 11,786,257 $ 27,267,912 $ 392,999,279
Accumulated
depreciation
and impairment ( 166,627) ( 27,634,688) ( 228,341,490) ( 9,587,514) - ( 265,730,319)
$ 11,833,180 $ 20,175,325 $ 65,793,800 $ 2,198,743 $ 27,267,912 $ 127,268,960
----- End of picture text -----

• A. Amount of borrowing costs capitalised as part of property, plant and equipment and the range of the interest rates for such capitalisation are as follows:

Amount capitalised Interest rate	Forthe years endedDecember31,	Forthe years endedDecember31,
	2021 106,397 $ 0.61%~3.84%	2020
		148,263 $
		0.80%~4.25%

• B. Under the regulations, land may only be owned by individuals. Thus, the Group has already obtained ownership of the agricultural land for future plant expansion which was acquired by the Group under the name of a third party, who has pledged the full amount to the Company. As of December 31, 2021 and 2020, the pledged amounts were $820,894 and $822,993, respectively.

~43~

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

• －

• (9) Leasing arrangements lessee

• A. The Group leases various assets including land and buildings. Rental contracts are typically made for periods of 2 to 49 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. The carrying amount of right-of-use assets and the depreciation charge are as follows:

Land Buildings Land Buildings	December 31, 2021 Carryingamount 1,509,752 $ 67,803 1,577,555 $ For the year ended December31,2021 Depreciation charge 164,275 $ 45,162 209,437 $	December 31, 2020 Carrying amount
		1,508,098 $ 33,746
		1,541,844 $
		For the year ended December31,2020
		Depreciation charge
		175,834 $ 29,609
		205,443 $

• C. For the years ended December 31, 2021 and 2020, the additions to right-of-use assets were $269,916 and $129,595, respectively.

• D. 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 variable lease payments Gain on sublease of right-of-use assets	For the year ended For the year ended December31,2021 December 31, 2020 11,206 $ 11,799 $ 30,986 20,524 4,421 3,291 5,749 3,323

• E. For the years ended December 31, 2021 and 2020, the Group’s total cash outflow for leases were $228,119 and $213,653, respectively.

~44~

(10) Non-current assets held for sale and discontinued operations

• A. On October 17, 2019, the Board of Directors of Formosa Taffeta Co., Ltd. resolved to dispose all its equity interest in Schoeller F.T.C. (Hong Kong) Co., Ltd. to Schoeller Textil AG for a consideration of $6,028, and the gain on disposal recognised in profit and loss was $165. The transfer of shares was completed on March 16, 2020. The disposal was presented as discontinued operation as it met the definition of discontinued operation. Accordingly, the Group made a restatement to the recognised profit or loss in relation to Schoeller F.T.C. (Hong Kong) Co., Ltd. rather than retrospective adjustment for the year ended December 31, 2020.

• B. The cash flow information of the discontinued operations is as follows:

The cash flow information of the discontinued	operations is as follows:
		For the year ended
		December 31, 2020
Operating cash flows	($	2,519)
Investing cash flows		-
Financing cash flows		-
Total cash flows	($	2,519)

• C. Analysis of the result of discontinued operations, and the result recognised on the remeasurement of assets or disposal group, is as follows:

of assets or disposal group, is as follows:
			For the year ended
			December31,2020
Revenue		$	17,555
Costs	(		12,365)
Expenses	(		5,589)
Non-operating income and expenses	(		85)
Loss before tax of discontinued operations	(		484)
Loss after tax of discontinued operations	($		484)

(11) Short-term loans and short-term notes and bills payable

Short-term loans and short-term notes and bills payable
Type of loans December 31,2021 OA loans 31,236 $ Secured loans 70,000 Unsecured loans 17,411,638 Total short-term loans 17,512,874 $ Short-term notes and bills payable 17,800,000 $ Short-term notes and bills payable discount 3,375) ( Net short-term notes and bills payable 17,796,625 $	Interestraterange 0.75%~4.50% 1.20% 0.42%~3.75% 0.28%~0.45%	Collateral
		None Note 8 None None

~45~

==> picture [477 x 169] intentionally omitted <==

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

Type of loans December 31, 2020 Interest rate range Collateral
OA loans $ 4,783 0.84% None
Secured loans 40,000 1.40% Note 8
Unsecured loans 19,010,837 0.75%~4.05% None
Total short-term loans $ 19,055,620
Short-term notes and bills
payable $ 16,100,000 0.20%~0.25% None
Short-term notes and bills
payable discount ( 3,267)
Net short-term notes and
bills payable $ 16,096,733
----- End of picture text -----

(12) Financial liabilities at fair value through profit or loss

Items Current items: Derivatives	December31,2021 December 31, 2020 - $ 137 $

• A. Amounts recognised in profit or loss in relation to financial liabilities at fair value through profit or loss are listed below:

Items Derivatives	For the year ended For the year ended December31,2021 December31,2020 137 $ 57) ($	For the year ended December31,2020

• B. The non-hedging derivative instruments transaction and contract information are as follows: December 31, 2021: None.

December 31, 2021: None.
Derivative Financial Liabilities Current items: Forward foreign exchange contracts: Taipei Fubon Taipei Fubon	December31,2020
	Contract Amount (Notional Principal) (in thousands)	Contract Period
	USD 415 USD 583	December 2020 - January 2021 December 2020 - February 2021

The forward exchange contracts are buy and sell to hedge the change of exchange rate due to import and export transactions, but not adopting hedge accounting.

~46~

(13) Bonds payable

Bonds payable
			December 31,2021			December 31,2020
Bonds payable
Domestic unsecured nonconvertible
corporate bonds		$	50,050,000		$	42,100,000
Less: Current portion	(		4,550,000)	(		2,050,000)
		$	45,500,000		$	40,050,000

The terms of nonconvertible corporate bonds were as follows:

Description	Issuance date	Maturity date	Yield rate(%)	Issued principal amount	December31,2021	December31,2020	Note
Second issued domestic unsecured nonconvertible corporate bonds - C Third issued domestic unsecured nonconvertible corporate bonds - B First issued domestic unsecured nonconvertible corporate bonds - C Second issued domestic unsecured nonconvertible corporate bonds First issued domestic unsecured nonconvertible corporate bonds - A First issued domestic unsecured nonconvertible corporate bonds - B 2012 2013 2014	2012.12.7 2013.1.22 2013.7.8 2014.1.17 2014.7.4 2014.7.4	2021.12.7~ 2022.12.7 2022.1.22~ 2023.1.22 2022.7.8~ 2023.7.8 2025.1.17~ 2026.1.17 2023.7.4 ~ 2024.7.4 2028.7.4 ~ 2029.7.4	1.51 1.50 1.52 2.03 1.81 2.03	$ 4,100,000 2,200,000 2,800,000 10,000,000 1,400,000 4,600,000	$ 2,050,000 2,200,000 2,800,000 10,000,000 1,400,000 4,600,000	$ 4,100,000 2,200,000 2,800,000 10,000,000 1,400,000 4,600,000	Serial bonds, to be settled 50%, 50% Serial bonds, to be settled 50%, 50% Serial bonds, to be settled 50%, 50% Serial bonds, to be settled 50%, 50% Serial bonds, to be settled 50%, 50% Serial bonds, to be settled 50%, 50%

~47~

Issuance date Maturity date First issued domestic unsecured nonconvertible corporate bonds - A 2019.5.13 2023.5.13~ 2024.5.13 First issued domestic unsecured nonconvertible corporate bonds - B 2019.5.13 2025.5.13~ 2026.5.13 First issued domestic unsecured nonconvertible corporate bonds - C 2019.5.13 2028.5.13~ 2029.5.13 First issued domestic unsecured nonconvertible corporate bonds - A 2020.9.3 2024.9.3~ 2025.9.3 First issued domestic unsecured nonconvertible corporate bonds - B 2020.9.3 2026.9.3~ 2027.9.3 First issued domestic unsecured nonconvertible corporate bonds - C 2020.9.3 2029.9.3~ 2030.9.3 First issued domestic unsecured nonconvertible corporate bonds - A 2021.5.10 2025.5.10~ 2026.5.10 First issued domestic unsecured nonconvertible corporate bonds - B 2021.5.10 2027.5.10~ 2028.5.10 2020 Less: Current portion of bonds payable 2019 2021	Issuance date	Maturity date	Yield rate(%)	Issued principal amount	December31,2021	December31,2020	Note
			0.75 0.83 0.93 0.52 0.60 0.67 0.48 0.56	$ 3,300,000 3,000,000 700,000 2,900,000 5,200,000 1,900,000 6,000,000 4,000,000	$ 3,300,000 3,000,000 700,000 2,900,000 5,200,000 1,900,000 6,000,000 4,000,000 50,050,000 4,550,000) ( 45,500,000 $	$ 3,300,000 3,000,000 700,000 2,900,000 5,200,000 1,900,000 - - 42,100,000 2,050,000) ( 40,050,000 $	Serial bonds, to be settled 50%, 50% Serial bonds, to be settled 50%, 50% Serial bonds, to be settled 50%, 50% Serial bonds, to be settled 50%, 50% Serial bonds, to be settled 50%, 50% Serial bonds, to be settled 50%, 50% Serial bonds, to be settled 50%, 50% Serial bonds, to be settled 50%, 50%

~48~

- (14) Long term bank loans and notes payable

Type of loans	Borrowing period/repayment term	Interest rate range	Collateral	December31,2021
Taipei Fubon Bank First Commercial Bank Mega International Commercial Bank Hua Nan Bank First Commercial Bank Mizuho Corporate Bank E. Sun Bank China Trust Bank Long-term bank loans Unsecured loans	Jul. 17, 2019 ~ Jul. 17, 2024, each 50% of principal is payable starting from 4 years and 5 years after the first drawdown Jul. 15, 2020 ~ Jul. 15, 2025, principal payable semi-annually after 4 years Dec. 13, 2021 ~ Dec. 13, 2026, principal payable semi-annually after 4 years Oct. 6, 2021 ~ Jan. 15, 2023, principal payable at maturity date Oct. 6, 2021 ~ Oct. 6, 2023, principal payable at maturity date Aug. 13, 2021 ~ Aug. 13, 2023, payable in full at maturity Dec. 15, 2020 ~ Dec. 14, 2023, payable in full at maturity Sep. 9, 2021 ~ Sep. 9, 2023, payable in full at maturity	LIBOR+0.78% (if TAIFX is higher than LIBOR+0.42%, the difference between TAIFX and LIBOR+0.42% is payable by the borrower) 1 to 5 years (including 5 years) rate of LPR- 0.8125% 1 to 5 years (including 5 years) rate of LPR- 1.35% 0.83% 0.79% 0.77% 0.85% 0.84%	None " " " " " " "	5,574,144 $ 1,212,494 690,545 1,000,000 1,000,000 1,600,000 200,000 500,000

~49~

Type of loans	Borrowing period/repayment term Interest rate range Mar. 12, 2021 ~ Mar. 12, 2023, payable in full at maturity 0.73% Jul. 13, 2021 ~ Jul. 13, 2023, payable in full at maturity 0.81% Aug. 16, 2021 ~ Aug. 16, 2023, payable in full at maturity 0.78% Dec. 3, 2021 ~ Dec. 2, 2023, payable in full at maturity 0.86% Aug. 20, 2020 ~ Aug. 10, 2023, payable in full at maturity 0.83% Jul. 21, 2021 ~ Jul. 21, 2023, payable in full at maturity 0.83% long-term loans	Collateral None " " " " "	December31,2021
Taipei Fubon Bank MUFG Bank HSBC Bangkok Bank Far Eastern International Bank Mega International Commercial Bank Less: Current portion of			1,500,000 $ 800,000 1,200,000 200,000 700,000 1,000,000 17,177,183 - 17,177,183 $

~50~

Type of loans	Borrowing period/repayment term	Interest rate range	Collateral	December31,2020
Taipei Fubon Bank First Commercial Bank Hua Nan Bank Mizuho Corporate Bank E. Sun Bank China Trust Bank Taipei Fubon Bank MUFG Bank Long-term bank loans Unsecured loans	Jul. 17, 2019 ~ Jul. 17, 2024, each 50% of principal is payable starting from 4 years and 5 years after the first drawdown Jul. 15, 2020 ~ Jul. 15, 2025, principal payable semi-annually after 4 years Jan. 15, 2020 ~ Jan. 15, 2022, principal payable at maturity date Aug. 13, 2020 ~ Aug. 13, 2022, payable in full at maturity Dec. 15, 2020 ~ Dec. 14, 2023, payable in full at maturity Sep. 11, 2020 ~ Sep. 11, 2022, payable in full at maturity Aug. 13, 2020 ~ Mar. 20, 2022, payable in full at maturity Aug. 13, 2020 ~ Aug. 13, 2022, payable in full at maturity	LIBOR+0.78% (if TAIFX is higher than LIBOR+0.42%, the difference between TAIFX and LIBOR+0.42% is payable by the borrower) 1 to 5 years (including 5 years) rate of LPR- 0.8125% 0.75% 0.82% 0.89% 0.89% 0.72% 0.85%	None " " " " " " "	7,161,828 $ 179,439 1,500,000 1,300,000 200,000 500,000 1,500,000 500,000

~51~

	Borrowing
	period/repayment	Interest
Type of loans	term	rate range	Collateral	December31,2020
MUFG Bank	Aug. 13, 2020 ~ Aug.	0.83%	None	$	300,000
	13, 2022, payable in
	full at maturity
HSBC	Aug. 13, 2020 ~ Aug.	0.83%	"		1,200,000
	13, 2022, payable in
	full at maturity
Bangkok Bank	Dec. 3, 2020 ~ Dec. 2,	0.90%	"		200,000
	2022, payable in full at
	maturity
Far Eastern	Aug. 20, 2020 ~ Aug.	0.90%	"		700,000
International Bank	10, 2023, payable in
	full at maturity
Mega	Sep. 21, 2020 ~ Sep.	0.90%	"		1,000,000
International	21, 2022, payable in
Commercial	full at maturity
Bank
Secured loans
Hua Nan Bank	Apr. 1, 2018 ~ Mar. 31,	2.27%	Endorsement
China Trust Bank	2021, principal payable		and
ANZ	annually		guarantees of
			Formosa
			Taffeta Co.,
			Ltd.		56,821
					16,298,088
Less: Current portion of long-term loans				(	56,821)
				$	16,241,267

The collaterals for long-term bank loans are described in Note 8.

~52~

(15) Pensions

• A. (a) The Company and its domestic subsidiaries have a defined benefit pension plan in accordance with the Labor Standards Law, covering all regular employees’ service years prior to the enforcement of the Labor Pension Act on July 1, 2005 and service years thereafter of employees who chose to continue to be subject to the pension mechanism under the Law. Under the defined benefit pension plan, two units are accrued for each year of service for the first 15 years and one unit for each additional year thereafter, subject to a maximum of 45 units. Pension benefits are based on the number of units accrued and the average monthly salaries and wages of the last 6 months prior to retirement. The Company and its domestic subsidiaries contribute monthly an amount equal to 2% of the employees’ monthly salaries and wages to the retirement fund deposited with Bank of Taiwan, the trustee, under the name of the independent retirement fund committee. Also, the Company and its domestic subsidiaries would assess the balance in the aforementioned labor pension reserve account by December 31, every year. If the account balance is insufficient to pay the pension calculated by the aforementioned method to the employees expected to qualify for retirement in the following year, the Company and its domestic subsidiaries will make contributions for the deficit by next March.

• (b) The amounts recognised in the balance sheet are as follows:

			December31,2021		December 31, 2020
Present value of defined benefit obligations		$	9,750,242		9,713,595 $
Fair value of plan assets	(		4,434,142)	(	4,530,754)
Net defined benefit liability		$	5,316,100		5,182,841 $

• (c) Movements in net defined benefit liabilities are as follows:

		Present value of	Present value of
		defined benefit			Fair value of			Net defined
			obligations		planassets		benefitliability
Year ended December 31, 2021
Balance at January 1		$	9,713,595	($	4,530,754)		$	5,182,841
Current service cost			74,685		-			74,685
Interest expense (income)			97,136	(	45,884)			51,252
			9,885,416	(	4,576,638)			5,308,778
Remeasurements:
Return on plan assets			-	(	22,209)	(		22,209)
Change in financial assumptions			227,724		-			227,724
Experience adjustments			291,092		-			291,092
			518,816	(	22,209)			496,607
Pension fund contribution	(		2,596)	(	106,717)	(		109,313)
Paid pension	(		651,394)		271,422	(		379,972)
Balance at December 31		$	9,750,242	($	4,434,142)		$	5,316,100

~53~

	Present value of	Present value of	Present value of
		defined benefit			Fair value of			Net defined
			obligations		plan assets		benefit liability
Year ended December 31, 2020
Balance at January 1		$	10,966,252	($	4,518,815)		$	6,447,437
Current service cost			95,389		-			95,389
Interest expense (income)			115,381	(	50,474)			64,907
			11,177,022	(	4,569,289)			6,607,733
Remeasurements:
Return on plan assets			-	(	139,437)	(		139,437)
Experience adjustments	(		274,572)		-	(		274,572)
	(		274,572)	(	139,437)	(		414,009)
Pension fund contribution			-	(	113,588)	(		113,588)
Paid pension	(		1,188,855)		291,560	(		897,295)
Balance at December 31		$	9,713,595	($	4,530,754)		$	5,182,841

• (d) The Bank of Taiwan was commissioned to manage the Fund of the Company’s and domestic subsidiaries’ defined benefit pension plan in accordance with the Fund’s annual investment and utilisation plan and the “Regulations for Revenues, Expenditures, Safeguard and Utilisation of the Labor Retirement Fund” (Article 6: The scope of utilisation for the Fund includes deposit in domestic or foreign financial institutions, investment in domestic or foreign listed, over-the-counter, or private placement equity securities, investment in domestic or foreign real estate securitization products, etc.). With regard to the utilization of the Fund, its minimum earnings in the annual distributions on the final financial statements shall be no less than the earnings attainable from the amounts accrued from twoyear time deposits with the interest rates offered by local banks. If the earnings is less than aforementioned rates, government shall make payment for the deficit after being authorized by the Regulator. The Company and domestic subsidiaries have no right to participate in managing and operating that fund and hence the Company and domestic subsidiaries are unable to disclose the classification of plan assets fair value in accordance with IAS 19 paragraph 142. The composition of fair value of plan assets as of December 31, 2021 and 2020 is given in the Annual Labor Retirement Fund Utilisation Report announced by the government.

• (e) The principal actuarial assumptions used were as follows:

government. The principal actuarial assumptions used	were as follows:
Discount rate Future salary increases	Year ended December31,2021 0.50% 1.00%~2.85%	Year ended December31,2020
		1.00%
		1.00%~2.85%

Assumptions regarding future mortality experience are set based on actuarial advice in accordance with published statistics and experience in each territory.

~54~

Because the main actuarial assumption changed, the present value of defined benefit obligation is affected. The analysis was as follows:

==> picture [450 x 208] intentionally omitted <==

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

Discount rate Future salary increases
Increase Decrease Increase Decrease
0.25% 0.25% 0.35% 0.35%
December 31, 2021
Effect on present value of
defined benefit obligation ($ 132,269) ($ 136,797) $ 193,390 ($ 183,703)
Discount rate Future salary increases
Increase Decrease Increase Decrease
0.25% 0.25% 0.35% 0.35%
December 31, 2020
Effect on present value of
defined benefit obligation ($ 141,186) $ 146,369 $ 210,288 ($ 198,851)
----- End of picture text -----

The sensitivity analysis above is based on one assumption which changed while the other conditions remain unchanged. In practice, more than one assumption may change all at once. The method of analysing sensitivity and the method of calculating net pension liability in the balance sheet are the same.

The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the previous period.

• (f) Expected contributions to the defined benefit pension plans of the Group for the year ending December 31, 2022 amount to $108,254.

• B. (a) From 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 Company’s mainland subsidiaries have a defined contribution plan. 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 certain percentage of employees’ monthly salaries and wages. The contribution percentage was 10~20% for the years ended December 31, 2021 and 2020. Other than the monthly contributions, the Group has no further obligations.

• (c) The pension costs under the defined contribution pension plans of the Group for the years ended December 31, 2021 and 2020 were $378,914 and $341,500, respectively.

~55~

(16) Capital stock

• A. As of December 31, 2021, the Company’s authorised and paid-in capital was $58,611,863, and total issued stocks was 5,861,186 thousand shares with a par value of $10 per share. All proceeds from shares issued have been collected.

• B. Changes in the treasury stocks for the years ended December 31, 2021 and 2020 are set forth below:

Reason for reacquisition	Subsidiary Formosa Taffeta Co. Formosa Taffeta Co. Subsidiary	Beginning Ending shares shares 12,169,610 - - 12,169,610 For the year ended December 31, 2020 For theyear ended December31,2021 Additions Disposal	Beginning Ending shares shares 12,169,610 - - 12,169,610 For the year ended December 31, 2020 For theyear ended December31,2021 Additions Disposal
Parent company shares held by subsidiaries reclassified from long-term investment to treasury stock Reason for reacquisition
		Beginning shares 12,169,610	Ending shares - - 12,169,610 Additions Disposal
Parent company shares held by subsidiaries reclassified from long-term investment to treasury stock

• C. The market value of treasury stocks was $80.8 and $84.7 (in dollars) per share at December 31, 2021 and 2020, respectively.

• D. The above treasury stocks of the parent company were purchased by subsidiaries.

(17) Capital surplus

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

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At January 1, 2021 Dividends allocated to subsidiaries Effect from net stockholding of associates recognised under the equity method Changes in ownership interests in subsidiaries Expired cash dividends reclassified to capital surplus Overdue dividends are transferred to capital surplus At December 31, 2021			For theyear ended December31,2021	For theyear ended December31,2021
	Share premium 2,710,554 $ - - - - - 2,710,554 $	Conversion premium of corporate bonds 5,514,032 $ - - - - - 5,514,032 $	Treasury share transactions 336,034 $ 11,379 - 820 - - 348,233 $	Effect from net stockholding of associates recognised Difference between stock price and book value for disposal or acquisition of usingequitymethod subsidiaries Others 378,153 $ 163 $ 228,701 $ - - - 442 - - 1,037 - - - - 682) ( - - 12,366 379,632 $ 163 $ 240,385 $	Others

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For the year ended December 31, 2020

			For theyear	ended December31,2020
At January 1, 2020 Dividends allocated to subsidiaries Effect from net stockholding of associates recognised under the equity method Changes in ownership interests in subsidiaries Expired cash dividends reclassified to capital surplus Overdue dividends are transferred to capital surplus At December 31, 2020	Share premium 2,710,554 $ - - - - - 2,710,554 $	Conversion premium of corporate bonds 5,514,032 $ - - - - - 5,514,032 $	Treasury share transactions 316,688 $ 17,295 - 2,051 - - 336,034 $	Effect from net stockholding of associates recognised Difference between stock price and book value for disposal or acquisition of usingequitymethod subsidiaries Others 372,847 $ 163 $ 224,585 $ - - - 4,568 - - 738 - - - - 304) ( - - 4,420 378,153 $ 163 $ 228,701 $	Others
					228,701 $

(18) Retained earnings

• A. Under the Company's Articles of Incorporation, the current year's earnings, if any, shall first be used to pay all taxes and offset prior years' operating losses and then 10% of the remaining amount shall be set aside as legal reserve. The remaining balance is to be set aside as special reserve if necessary; and distributed to shareholders as interest on capital. The remaining balance for current year, after allocating for interest on capital, shall be accumulated with remaining balance of previous year. Bonus distributed shall be proposed by the Board of Directors and resolved by the stockholders.

• The special reserve includes:

• (a) Reserve for a special purpose;

• (b) Investment income recognised under equity method and deferred income tax assets arising from unused investment tax credits which are deemed unrealised and transferred to special reserve. Such investment income and deferred income tax assets are reclassified to unappropriated earnings only when they are realised;

• (c) Net unrealised gains from financial instruments transactions. The special reserve for unrealised gains from financial instruments is reduced when the accumulated value of the unrealised gains also decreases; and

• (d) Other special reserves as stipulated by other laws.

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• B. The Group is in the mature stage and the profit is stable. The Board of Directors shall establish the cash dividend or stock dividend percentage. At least 50% of the distributable earnings after deducting the legal reserve, directors' and supervisors' remuneration, employee bonus and special reserves shall be distributed to stockholders. The Group would prefer cash dividend. If the Group requires funds for significant investments or needs to improve its financial structure, part of the dividend will be in the form of stocks which shall not exceed 50% of the total dividends.

• 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 Group’s paid-in capital.

• D. In accordance with the regulations, the Group 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 reversed amount could be included in the distributable earnings.

• E. The appropriations of 2020 earnings had been resolved after meeting the statutory voting threshold before June 30, 2021 via the electronic voting platform for the stockholders’ meeting and had been resolved at the stockholders’ meeting on July 23, 2021. The appropriations of 2019 earnings had been resolved at the stockholders’ meeting on June 5, 2020. Details are as follows:

For the years ended December 31,

Legal reserve Special reserve Cash dividends	Dividends per share Amount (indollars) 1,978,906 $ 3,704,582 14,652,966 2.50 $ 20,336,454 $ 2020	2019	2019
	Amount 1,978,906 $ 3,704,582 14,652,966 20,336,454 $	Amount 2,970,224 $ 6,156,414 22,272,508 31,399,146 $	Dividends per share (indollars)
			$ 3.80

Information about the appropriation of employees’ bonus and directors’ and supervisors’ remuneration by the Group as proposed by the Board of Directors and resolved by the stockholders will be posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

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• F. The appropriations of the 2021 net income was approved by the Board of Directors during its meeting on March 9, 2022 as follows:

Other equity items Legal reserve Special reserve Cash dividends Hedging Unrealised gain reserve (loss) At January 1, 2021 32,123 $ 98,095,277 $ Revaluation: –Group - 21,531,864 –Associates - 2,881,494 Revaluation transferred to retained earnings: –Group - 1,277,669) ( –Associates - 2,565) ( Cash flow hedges: –Associates 22,853) ( - Currency translation differences: –Group - - –Tax of Group - - –Associates - - At December 31, 2021 9,270 $ 121,228,401 $

Dividends per share Amount (indollars) 3,910,207 $ 6,428,356 28,133,694 $ 4.80 38,472,257 $ For the year ended December 31,2021 Currency translation Total 5,272,606) ($ 92,854,794 $ - 21,531,864 - 2,881,494 - 1,277,669) ( - 2,565) ( - 22,853) ( 562,598) ( 562,598) ( 111,624 111,624 517,090) ( 517,090) ( 6,240,670) ($ 114,997,001 $

(19) Other equity items

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	Hedging		Unrealised gain		Currency
	reserve		(loss)		translation		Total
At January 1, 2020	659 $	$	107,120,877	($	4,560,606)	$	102,560,930
Revaluation:
–Group	-	(	8,265,352)		-	(	8,265,352)
–Associates	-	(	874,558)		-	(	874,558)
Revaluation transferred
to retained earnings:
–Group	-		29,924		-		29,924
–Associates	-		84,386		-		84,386
Cash flow hedges:
–Associates	31,464		-		-		31,464
Currency translation
differences:
–Group	-		-		207,642		207,642
–Tax of Group	-		-	(	104,057)	(	104,057)
–Associates	-		-	(	815,585)	(	815,585)
At December 31, 2020	32,123 $	$	98,095,277	($	5,272,606)	$	92,854,794

(20) Operating revenue

Sales revenue Service revenue Other operating revenue Less: Income from discontinued operations	2021 2020 364,725,115 $ 252,534,471 $ 559,829 440,044 527,154 337,708 365,812,098 253,312,223 - 17,555) ( 365,812,098 $ 253,294,668 $ Forthe years endedDecember31,

The Group derives revenue from the transfer of goods and services over time and at a point in time. (21) Interest income

Interest income
Interest income from bank deposits Interest from current account with others Other interest income Less: Interest income from discontinued operations	Forthe years endedDecember31,
	2021 2020 291,634 $ 246,474 $ 43,478 104,467 15,762 5,897 350,874 356,838 - 72) ( 350,874 $ 356,766 $	2020
		246,474 $ 104,467 5,897
		356,766 $

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(22) Other income

Other income
				For theyears ended			December31,
				2021			2020
Rent income	$			136,415	$		137,278
Dividend income				3,116,391			5,113,321
Other income				1,194,188			1,744,670
	$			4,446,994	$		6,995,269
Other gains and losses
				Forthe years ended			December31,
				2021			2020
Gain on disposal of property, plant and
equipment		$		4,770		$	692,419
Gain on disposal of investments				-			165
Net currency exchange loss	(			268,066)	(		701,669)
Net loss on financial assets and liabilities at fair
value through profit or loss	(			91,153)	(		155,552)
Other losses	(			235,517)	(		229,547)
	(			589,966)	(		394,184)
Less: Other losses from discontinued operations				-			157
	($			589,966)	($		394,027)
Finance costs
				Forthe years ended			December31,
				2021			2020
Interest expense:
Bank loans			$	431,810		$	756,541
Corporate bonds				605,260			546,415
Current account with others				26,463			16,587
Discount				63,169			81,295
Other interest expenses				27,749			41,312
				1,154,451			1,442,150
Less: Capitalisation of qualifying assets	(			106,397)	(		148,263)
			$	1,048,054		$	1,293,887

(23) Other gains and losses

(24) Finance costs

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(25) Expenses by nature

Expenses by nature
		Forthe years ended		December31,
		2021		2020
Depreciation charges on property, plant and
equipment and right-of-use assets	$	13,806,835	$	13,365,687
Employee benefit expense		14,695,683		13,253,706
Amortisation		4,185,976		3,669,159
		32,688,494		30,288,552
Less: Employee benefit expenses from
discontinued operations		-	(	535)
Less: Depreciation charges on property, plant
and equipment and right-of-use assets
from discontinued operations		-	(	231)
	$	32,688,494	$	30,287,786

(26) Employee benefit expense

Wages and salaries Labor and health insurance fees Pension costs Other personnel expenses Less: Employee benefit expenses from discontinued operations	2021 2020 12,560,038 $ 11,290,212 $ 991,394 880,428 504,851 501,796 639,400 581,270 14,695,683 13,253,706 - 535) ( 14,695,683 $ 13,253,171 $ Forthe years endedDecember31,

A. In accordance with the Articles of Incorporation of the Company, a ratio of distributable profit before income tax of the current year, after covering accumulated losses, shall be distributed as employees' compensation. The ratio shall not be lower than 0.05% and shall not be higher than 0.5% for employees’ compensation.

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• B. For the years ended December 31, 2021 and 2020, employees’ remuneration (bonuses) was accrued at $41,705 and $20,624, respectively. The aforementioned amount was recognised in salary expenses.

For the years ended December 31, 2021 and 2020, the employees’ compensation was estimated and accrued based on approximately 0.1% of the distributable profit.

Employees’ compensation for 2020 as resolved by the Board of Directors was in agreement with the amount of $20,624 recognised in profit or loss for 2020. Employees’ compensation for 2020 had been distributed.

Information about the appropriations of employees’ bonus and directors’ and supervisors’ remuneration by the Company as proposed by the Board of Directors and resolved by the stockholders will be posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

(27) Income tax

• A. Income tax expense

• (a) Components of income tax expense:

Stock Exchange. ome tax Income tax expense (a) Components of income tax expense:
			Forthe years ended			December31,
			2021			2020
Current tax:
Current tax on profits for the year		$	7,461,782		$	2,623,257
Land value increment tax is included in
profit or loss			-			566
Tax on undistributed surplus earnings			161,956			204,379
Adjustments in respect of prior years	(		94,879)			141,472
Total current tax			7,528,859			2,969,674
Deferred tax:
Origination and reversal of temporary
differences	(		75,761)			246,173
Effect of exchange rate	(		634)	(		2,353)
Total deferred tax	(		76,395)			243,820
Income tax expense		$	7,452,464		$	3,213,494
(b) The income tax charge relating to components of other comprehensive						income is as follows:
			For theyears ended			December31,
			2021			2020
Currency translation differences	$		111,624	($		104,057)

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B. Reconciliation between income tax expense and accounting profit

			Forthe years ended	Forthe years ended	Forthe years ended	December31,
			2021			2020
Tax calculated based on profit before tax and
statutory tax rate		$	12,895,686		$	7,290,809
Expenses disallowed by tax regulation	(		5,366,454)	(		3,710,301)
Effect from net operating loss carryforward	(		49,672)	(		661,219)
Effect from changes in tax regulation of
overseas subsidiaries	(		94,173)	(		52,212)
Additional tax on undistributed earnings			161,956			204,379
Under provision of prior year's income tax	(		94,879)			141,472
Land value increment tax included in profit
or loss			-			566
Income tax expense		$	7,452,464		$	3,213,494

C. Amounts of deferred tax assets or liabilities as a result of temporary differences are as follows:

January1 Deferred tax assets: Temporary differences: Currency translation differences 853,541 $ Unrealised gain from downstream transactions 9,449 Loss on inventory 213,732 Accrued pension liabilities 690,374 Impairment loss 167,792 Others 176,274 2,111,162 $ Deferred tax liabilities: Temporary differences: Investment income accounted for using equity methed 397,238) ($ Depreciation useful life difference 40,276) ( Others 2,723) ( 440,237) ($ 1,670,925 $		For theyear ended December31,2021	For theyear ended December31,2021
		Effect of changes in consolidated Recognised in profit subsidiary or loss - $ - $ - 55,560 - 51,324 - 60,877) ( - 26,929) ( - 1,542) ( - $ 17,536 $ - $ 47,818 $ - 8,537 - 1,870 - $ 58,225 $ - $ 75,761 $	Recognised in other comprehensive income December31 111,624 $ 965,165 $ - 65,009 - 265,056 - 629,497 - 140,863 - 174,732 111,624 $ 2,240,322 $ - $ 349,420) ($ - 31,739) ( - 853) ( - $ 382,012) ($ 111,624 $ 1,858,310 $	December31
				965,165 $ 65,009 265,056 629,497 140,863 174,732
				2,240,322 $
				1,858,310 $

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January1 Deferred tax assets: Temporary differences: Currency translation differences 957,598 $ Unrealised loss from downstream transactions 57,035 Loss on inventory 264,857 Accrued pension liabilities 888,035 Impairment loss 194,145 Others 86,299 2,447,969 Deferred tax liabilities: Temporary differences: Investment income accounted for using equity methed 377,608) ( Depreciation useful life difference 49,272) ( Others - 426,880) ( 2,021,089 $

Effect of changes in consolidated Recognised in profit Recognised in other comprehensive subsidiary or loss income December31 - $ - $ 104,057) ($ 853,541 $ - 47,586) ( - 9,449 - 51,125) ( - 213,732 - 197,661) ( - 690,374 - 26,353) ( - 167,792 66 89,909 - 176,274 66 232,816) ( 104,057) ( 2,111,162 - 19,630) ( - 397,238) ( - 8,996 - 40,276) ( - 2,723) ( - 2,723) ( - 13,357) ( - 440,237) ( 66 $ 246,173) ($ 104,057) ($ 1,670,925 $ For theyear ended December31,2020

• D. Expiration dates of unused tax losses and amounts of unrecognised deferred tax assets are as follows:

follows:
Year incurred 2012 2014 2015 2017 2018 2019 2020 2021	Amount filed/ assessed Assessed Assessed Assessed Assessed Assessed Assessed Amount filed Amount filed	December	Taxassets 7,125 $ 3,876 1,584 5,105 2,815 953 6,548 10,618 38,624 $ 31,2021	Expiry year
		Unused amount 7,125 $ 3,876 1,584 5,105 2,815 953 6,548 11,642 39,648 $
				2022 2024 2025 2027 2028 2029 2030 2031

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December 31, 2020

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

Amount filed/
Year incurred assessed Unused amount Tax assets Expiry year
----- End of picture text -----

2011 Assessed 2012 Assessed 2013 Assessed 2014 Assessed 2015 Assessed 2016 Assessed 2017 Assessed 2018 Assessed 2019 Amount filed 2020 Amount filed	21,568 $ 29,604 7,312 11,448 25,835 30,819 12,072 2,815 9,314 6,548 157,335 $	21,568 $ 2021 29,604 2022 7,312 2023 11,448 2024 25,835 2025 30,819 2026 12,072 2027 2,815 2028 9,314 2029 6,548 2030 157,335 $

• E. The amounts of deductible temporary differences that were not recognised as deferred tax assets are as follows:

are as follows:
Deductible temporary differences	December31,2021 21,539 $	December31,2020
		31,638 $

• F. The Company’s income tax returns through 2018 have been assessed and approved by the Tax Authority.

(28) Earnings per share

• A. Basic earnings per share

Basic earnings per share is calculated by dividing the profit attributable to ordinary shareholders

of the parent by the weighted average number of ordinary shares in issue during the year.

Consolidated net income Net income of non- controlling interest Profit attributable to ordinary shareholders of the parent Profit attributable to discontinued operations of the parent Profit attributable to continuing operations of the parent Basic earnings per share	For theyear ended December 31,2021	For theyear ended December 31,2021	For theyear ended December 31,2021
	Before tax After tax (shares in thousands) 50,159,895 $ 42,707,431 $ 8,496,263 4,348,084 41,663,632 38,359,347 - - 41,663,632 $ 38,359,347 $ 5,849,017 Amount Weighted average number of ordinary shares outstanding	(in dollars) Earnings per share
	Before tax 50,159,895 $ 8,496,263 41,663,632 - 41,663,632 $	Before tax 8.58 $ 1.46 7.12 - 7.12 $	After tax
			7.30 $ 0.74
			6.56
			-
			6.56 $

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

For the year ended December 31, 2020
Weighted average
number of
ordinary shares Earnings per share
Amount outstanding (in dollars)
Before tax After tax (shares in thousands) Before tax After tax
Basic earnings per share
Consolidated net income $ 24,767,203 $ 21,553,709 $ 4.23 $ 3.69
Net income of non-
controlling interest 4,164,014 2,009,568 0.71 0.35
Profit attributable to
ordinary shareholders
of the parent 20,603,189 19,544,141 3.52 3.34
Profit attributable to
discontinued operations
of the parent ( 484) ( 484) ( 0.00) ( 0.00)
Profit attributable to
continuing operations
of the parent $ 20,603,673 $ 19,544,625 5,849,017 $ 3.52 $ 3.34
----- End of picture text -----

• B. Employees’ bonus could be distributed in the form of stock. Since there is no significant impact when calculating diluted earnings per share, basic earnings per share equals diluted earnings per share.

• C. If stocks of the parent company held by subsidiaries are not treated as treasury stocks, the calculation of basic earnings per share is as follows:

Consolidated net income Net income of non- controlling interest Profit attributable to ordinary shareholders of the parent Profit attributable to discontinued operations of the parent Profit attributable to continuing operations of the parent Basic earnings per share	For theyear ended December 31,2021	For theyear ended December 31,2021	For theyear ended December 31,2021
	Before tax After tax (shares in thousands) 50,159,895 $ 42,707,431 $ 8,496,263 4,348,084 41,663,632 38,359,347 - - 41,663,632 $ 38,359,347 $ 5,861,186 Weighted average number of ordinary shares outstanding Amount	Earnings per share (in dollars)
	Before tax 50,159,895 $ 8,496,263 41,663,632 - 41,663,632 $	Before tax 8.56 $ 1.45 7.11 - 7.11 $	After tax
			7.29 $ 0.75
			6.54
			-
			6.54 $

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

For the year ended December 31, 2020
Weighted average
number of
ordinary shares Earnings per share
Amount outstanding (in dollars)
Before tax After tax (shares in thousands) Before tax After tax
Basic earnings per share
Consolidated net income $ 24,767,203 $ 21,553,709 $ 4.23 $ 3.68
Net income of non-
controlling interest 4,164,014 2,009,568 0.71 0.35
Profit attributable to
ordinary shareholders
of the parent 20,603,189 19,544,141 3.52 3.33
Profit attributable to
discontinued operations
of the parent ( 484) ( 484) ( 0.00) ( 0.00)
Profit attributable to
continuing operations
of the parent $ 20,603,673 $ 19,544,625 5,861,186 $ 3.52 $ 3.33
----- End of picture text -----

(29) Business combinations

• A. On September 24, 2020, the Group acquired an additional 21% equity interest in Chia-Nan Enterprise Corp. for a total cash consideration of $145,527. The Group’s comprehensive shareholding ratio increased from 30% to 51%.

• B. The following table summarises the consideration paid for Chia-Nan Enterprise Corp. and the fair values of the assets acquired and liabilities assumed at the acquisition date, as well as the fair value of the non-controlling interest at the acquisition date:

value of the non-controlling interest at the acquisition date:
			For the year ended
			December31,2020
Purchase consideration
Cash paid		$	145,527
Fair value of equity interest in Chia-Nan Enterprise Corp. held
before the business combination			207,448
Fair value of the non-controlling interest			338,120
			691,095
Fair value of the identifiable assets acquired and liabilities assumed
Cash			79,367
Accounts receivable			10,616
Property, plant and equipment			640,204
Accounts payable	(		3,782)
Other payables	(		22,564)
Others	(		12,746)
Total identifiable net assets			691,095
		$	-

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• C. The Group recognised a gain of $447 as a result of measuring at fair value its 30% equity interest in Chia-Nan Enterprise Corp. held before the business combination.

(30) Supplemental cash flow information

• A. Investing activities with partial cash payments

		For theyears ended	For theyears ended	December31,
		2021		2020
Purchase of fixed assets	$	17,553,163	$	15,899,292
Add: Opening balance of payable on equipment		1,656,593		1,439,071
Less: Ending balance of payable on equipment	(	3,057,560)	(	1,656,593)
Cash paid during the year	$	16,152,196	$	15,681,770

• B. Financing activities with partial cash payments

		For theyears ended	For theyears ended	December31,
		2021		2020
Cash dividends distributed	$	14,652,966	$	22,272,508
Add: Opening balance of cash dividends payable		76,913		71,884
Less: Ending balance of cash dividends payable	(	72,427)	(	76,913)
Cash dividends paid	$	14,657,452	$	22,267,479

• C. On March 16, 2020, the Board of Directors of Formosa Taffeta Co., Ltd. resolved to dispose all its equity interest in Schoeller F.T.C. (Hong Kong) Co., Ltd. The trading consideration information is listed below:

information is listed below:
			For the year ended
			December31,2020
Disposal proceeds		$	6,028
Less: Book value of cash and cash equivalents	(		29,584)
Cash paid	($		23,556)

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(31) Changes in liabilities from financing activities

Short-term borrowings At January 1, 2021 19,055,620 $ Changes in cash flow from financing activities 1,542,746) ( Impact of changes in foreign exchange rate - At December 31, 2021 17,512,874 $ Short-term borrowings At January 1, 2020 32,369,623 $ Changes in cash flow from financing activities 13,314,003) ( Impact of changes in foreign exchange rate - At December 31, 2020 19,055,620 $	Short-term notes and bills payable 16,096,733 $ 1,699,892 - 17,796,625 $ Short-term notes and bills payable 14,396,370 $ 1,700,363 - 16,096,733 $	Bonds payable (including current Long-term borrowing (including current Liabilities from financial portion) portion) activities-gross 42,100,000 $ 16,298,088 $ 93,550,441 $ 7,950,000 1,069,062 9,176,208 - 189,967) ( 189,967) ( 50,050,000 $ 17,177,183 $ 102,536,682 $ Bonds payable (including current Long-term borrowing (including current Liabilities from financial portion) portion) activities-gross 34,850,000 $ 18,051,565 $ 99,667,558 $ 7,250,000 1,475,808) ( 5,839,448) ( - 277,669) ( 277,669) ( 42,100,000 $ 16,298,088 $ 93,550,441 $

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7. Related Party Transactions

(1) Names of related parties and relationship

lated Party Transactions Names of related parties and relationship
Names of related parties	Relationship withthe Group
Formosa Petrochemical Corp. Formosa Heavy Industries Corp. Formosa Heavy Industries (Ningbo) Corp. Formosa Plastics Transport Corp. Formosa Synthetic Rubber Corp. (The dissolution and liquidation were completed on December 28, 2020.) Formosa Synthetic Rubber (Ningbo) Corp. Mai Liao Power Corp. Formosa Environmental Technology Corp. Hwa Ya Science Park Management Consulting Corp. Formosa Resourses Corp. Formosa Construction Corp. Formosa Fairway Corporation Kuang Yueh Co., Ltd. Formosa Group (Cayman) Corp. Guo Su Plastic Industry Co., Ltd. FG Inc. Formosa Advanced Technologies Co., Ltd. Schoeller Textil AG Nan Ya Optical Corp. Formosa Plastics Corp. Nan Ya Plastics Corp. Nan Ya Plastics (Hui Zhou) Corp. Nan Ya Plastics (Nan Tong) Corp. Nan Ya Plastics Corp., U.S.A. Nan Ya Plastics (Ningbo) Corp. Nan Ya Technology Corp. Nan Ya PCB Corp. Nan Ya Electronic Materials Co., Ltd. Formosa Automobile Sales Corporation Formosa Petrochemical Transportation Corporation Formosa Lithium Iron Oxide Corp. Chang Gung University Chang Gung Memorial Hospital Chang Gung Biotechnology Co., Ltd. Yue Chi Development Corp. PFG Fiber Glass Corp. Formosa Plastics Marine Corp. Formosa Plastics Marine Co., Ltd. Mai Liao Harbor Administration Corp. Formosa Network Technology Corp.	Associate ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ Other related party ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵ ˵

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Names of related parties Relationship with the Group Formosa Plastics Building Parking Lot Other related party FPG Travel Service Co., Ltd. ˵ Formosa Daikin Advanced Chemicals Co., Ltd. ˵ ˵ Formosa Sumco Technology Corporation ˵ Formosa Asahi Spandex Co., Ltd. ˵ Formosa Plastics Logistics Corp. ˵ Formosa Plastics Transport (Ningbo) Co., Ltd. ˵ Formosa Electronic (Ningbo) Co., Ltd. ˵ Inteplast Taiwan Corporation ˵ Formosa Oil (Asia Pacific) Corporation ˵ Asia Pacific Development Corp. ˵ Ya Tai Development Corp. ˵ Bio Trust International Corp. ˵ Formosa Ha Tinh (Cayman) Ltd. ˵ Formosa Ha Tinh Steel Corp. - TW ˵ Formosa Ha Tinh Steel Corp. ˵ BP Chemicals (Malaysia) SDN Corp. (Note) INEOS Acetyls (Malaysia) SDN Bhd Idemitsu Kosan Co., Ltd. ˵ ˵ Idemitsu Chemicals (Hong Kong) Co., Ltd. ˵ Idemitsu Chemicals U.S.A. Corp. ˵ Yugen Co., Ltd. ˵ Yumaowu Enterprise Co., Ltd. ˵ Yu Yuang Textile Co., Ltd. ˵ Yu Maowu Complex Co., Ltd. ˵ NKFG Corporation ˵ Kuang Yueh (Vietnam) Co., Ltd. ˵ Hua Ya Power Corp. ˵ Asia Pacific Technology Corp. ˵ Ya Tai Development Co., Ltd. ˵ Kong You Industrial Co., Ltd. ˵ Hong Jing Metal Corp. ˵ Formosa Industries (Ningbo) Co., Ltd. ˵ Nan Ya Plastics Industry (Anshan) Co., Ltd. Nan Ya Electronic Materials (Kunshan) Co., Ltd. ˵ ˵ Nan Ya Plastics Film (Nantong) Co., Ltd. Nan Ya Plastics Film (Hui Zhou) Co., Ltd ˵ Nan Ya Chemical Fiber (Kunshan) Co., Ltd. ˵ Nan Ya Draw-Textured Yarn (Kunshan) Co., Ltd. ˵ Nan Ya Plastics (Xiamen) Co., Ltd. ˵ ˵ Formosa Heavy Industries (Guangzhou) Co., Ltd. Asia Pactfic Investment Co. ˵ ˵ Nan Ya Printed Circuit Board Corp. ˵ Formosa Automobile Corp. ˵ Taisuwang Commerce and Trade Co., Ltd. ˵ Huaya Steel Co., Ltd. ˵ Fuxin Special Steel Co., Ltd.

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Note: On January 1, 2021, the original shareholder who held 50% of the shares of the subsidiary of the Group has disposed its holdings to INEOS Quattro Holding Ltd. Therefore, BP Chemicals (Malaysia) SDN Corp. is not a related party of the Group since January 1, 2021.

• (2) Significant related party transactions

• A. Sales of goods:

(Malaysia) SDN Corp. is not a related party nificant related party transactions Sales of goods:	of the Group since January 1, 2021.	of the Group since January 1, 2021.
Sales of goods: － Associates － Other related parties	2021 2020 33,690,289 $ 17,659,638 $ 48,259,385 35,277,988 81,949,674 $ 52,937,626 $ For theyears ended December31,
		52,937,626 $

The Group sells goods to related parties. Except for terms to certain related parties which are longer, prices are the same with third parties.

B. Purchases of goods:

longer, prices are the same with third parties. Purchases of goods:
Purchases of goods: － Associates Formosa Petrochemical Corp. Others － Other related parties	For the years ended December 31,
	2021 156,498,774 $ 7,465 27,549,418 184,055,657 $	2020
		94,784,512 $ 5,071 15,791,596
		110,581,179 $

The payment terms for related parties are within 30~60 days of purchase. The purchase prices and terms for related parties are the same with non-related parties.

C. Receivables from related parties:

Receivables from related parties:
. Receivables from related parties: － Associates － Other related parties	December31,2021 3,264,658 $ 5,462,856 8,727,514 $	December31,2020
		2,010,960 $ 3,947,994
		5,958,954 $

Receivables from related parties are mainly from sales of goods and receivables for payments on behalf of others for construction design services. Receivables for sales are due 30~120 days from the date of sale; receivables for payments on behalf of others for construction design services are due 270 days from the services rendered. The receivables do not bear interest and no collaterals were pledged. No provision was accrued for receivables from related party.

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D. Payables to related parties:

Payables to related parties:
.		December31,2021		December31,2020
Payables to related parties:
－ Associates
Formosa Petrochemical Corp.	$	14,838,406	$	9,806,133
－ Other related parties		2,688,722		2,402,434
	$	17,527,128	$	12,208,567

The payables to related parties arise mainly from purchase transactions and are due 30~60 days after the date of purchase. The payables bear no interest.

• E. Expansion and repair project

• (a) Expansion and repair project:

ansion and repair project Expansion and repair project:
Expansion and repair works of factory sites － Associates －Other related parties	Forthe years endedDecember31,
	2021 352,208 $ 130,496 482,704 $	2020
		388,787 $ 367,340
		756,127 $

• (b) Ending balance of payables for expansion and repair project:

. Payables to related parties: － Associates － Other related parties	December31,2021 888 $ 68,532 69,420 $	December31,2020
		95 $ 41,945
		42,040 $

The Group contracted the expansion and repair works of the factory sites to related parties. The payment terms are in accordance with the industry practice with payment due within a month after inspection.

F. Financing

• (a) Loans to related parties:

i. Ending balance of accounts receivable - related parties

. － Other related parties Formosa Plastics Marine Co., Ltd.	December31,2021 2,698,693 $	December31,2020
		4,195,598 $

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ii. Interest income

Interest income
		Forthe years ended		December31,
		2021		2020
－ Associates
Formosa Heavy Industries Corp.	$	1,917	$	41,986
－ Other related parties
Formosa Plastics Marine Co., Ltd.		41,451		62,461
	$	43,368	$	104,447

The loan terms to related parties are in accordance with the contract’s repayment schedule after the loan is made; interest was collected at 0.98%~1.23% and 1.23%~1.42% per annum for the years ended December 31, 2021 and 2020, respectively.

• (b) Loans from related parties:

• i. Ending balance of accounts payable - related parties

－ Associates － Other related parties	December31,2021 515,520 $ 26,493 542,013 $	December 31, 2020
		531,808 $ -
		531,808 $

－ Associates － Other related parties	December31,2021 December 31, 2020 515,520 $ 531,808 $ 26,493 - 542,013 $ 531,808 $
ii. Interest expense －Associates － Other related parties	For theyears ended December31,
	2021 2020 15,492 $ 5,045 $ 211 - 15,703 $ 5,045 $

The loan terms from associates are in accordance with the contract’s repayment schedule after the loan is made; interest is paid at a rate of 3.08% and 1.23%~3.08% per annum for the years ended December 31, 2021 and 2020, respectively.

• G. Operating expenses

Operating expenses
Transportation charges － Other related parties Formosa Plastics Marine Corp. Formosa Plastics Transport (Ningbo) Others	Forthe years endedDecember31,
	2021 700,493 $ 1,053,817 383,934 2,138,244 $	2020
		1,532,921 $ 883,536 142,093
		2,558,550 $

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H. Rental revenue

－ Associates Formosa Petrochemical Corp. Others － Other related parties Nan Ya Plastics Corp. Formosa Plastics Building Parking Lot Formosa Network Technology Corp. Others	2021 2020 21,215 $ 21,215 $ 12,590 12,022 33,805 33,237 27,182 25,791 15,815 16,064 15,400 15,400 26,438 29,682 84,835 86,937 118,640 $ 120,174 $ Forthe years endedDecember31,

The rental prices charged to related parties are determined considering the local rental prices and payments, and are collected monthly.

I. Property transactions:

• (a) Acquisition of property, plant and equipment

Purchase of property, plant and equipment － Associates － Other related parties Nan Ya Draw-Textured Yarn (Kunshan) Co., Ltd. Others	2021 2020 291,614 $ 278,560 $ - 1,233,875 24,418 734 316,032 $ 1,513,169 $ For the years ended December 31,	2021 2020 291,614 $ 278,560 $ - 1,233,875 24,418 734 316,032 $ 1,513,169 $ For the years ended December 31,
		2020
		278,560 $ 1,233,875 734
		1,513,169 $

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(b) Acquisition of financial assets

J. Donation: Accounts Formosa Resources Corp. Investments accounted for using equity method Guo Su Plastic Industry Co., Ltd. Investments accounted for using equity method Accounts NKFG Corporation Non-current financial assets at fair value through other comprehensive income Formosa Construction Corp. Investments accounted for using equity method Schoeller Textil AG Investments accounted for using equity method FG Inc. Investments accounted for using equity method －Other related parties	Accounts	No. ofshares 88,453,125 1,875,000 No. ofshares	No. ofshares 88,453,125 1,875,000 No. ofshares	For the year ended December31,2021 Objects Consideration Formosa Resources Corp. 887,813 $ Guo Su Plastic Industry Co., Ltd. 48,469 936,282 $ For the year ended December31,2020 Objects Consideration NKFG Corporation 55,400 $ Formosa Construction Corp. 500,000 Schoeller Textil AG 1,285,507 FG Inc. 811,408 2,652,315 $ Forthe years endedDecember31,	For the year ended December31,2021 Consideration 887,813 $ 48,469	For the year ended December31,2021 Consideration 887,813 $ 48,469
	Investments accounted for using equity method Investments accounted for using equity method Accounts
					936,282 $
					For the year ended December31,2020
					Consideration
		5,540,000 50,000,000 21,874 - $			55,400 $ 500,000 1,285,507 811,408
					2,652,315 $
				2021 3,781		2020
			$			6,121 $

K. Details of affiliates endorsed/guaranteed for the Group’s borrowings are provided in Note 6(14).

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L. Details of affiliates endorsed/guaranteed and commitment letter for the Associate are provided in Notes 9(3) and (4).

(3) Key management compensation

Notes 9(3) and (4). Key management compensation
Salaries Post-employment benefits	For theyears ended December31,
	2021 131,392 $ 1,480 132,872 $	2020
		127,995 $ 1,505
		129,500 $

8. Pledged Assets

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

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

Book value
Pledged assets December 31, 2021 December 31, 2020 Purpose
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Property, plant and equipment Inventory Non-current financial assets at amortised cost - Time deposits	5,873,527 $ 17,610 1,500 5,892,637 $	5,886,513 $ Collateral for bank loans 17,610 Collateral for bank loans 1,500 Guarantee deposits for natural gas 5,905,623 $

9. Significant Contingent Liabilities and Unrecognised Contract Commitments

The details of commitments and contingencies as of December 31, 2021 were as follows:

• (1) Capital expenditures of property, plant and equipment that were contracted but not yet paid amounted to $8,443,882 thousand, RMB 1,331,314 thousand and VND 493,700,030 thousand.

• (2) The outstanding letters of credit for major raw materials and equipment purchases amounted to USD 2,611 thousand, JPY 555,379 thousand and EUR 3,376 thousand.

• (3) The provision of endorsements and guarantees to others are as follows:

Formosa Resources Corp. Formosa Group (Cayman) Corp. Formosa Ha Tinh (Cayman) Corp. Formosa Taffeta (Zhong Shan) Co., Ltd. Formosa Taffeta (Vietnam) Co., Ltd. Formosa Taffeta (Changshu) Co., Ltd. Formosa Taffeta (Dong Nai) Co., Ltd.	December 31,2021 - $ 6,922,500 8,778,019 13,840 484,408 189,498 2,358,647 18,746,912 $	December 31,2020
		3,064,610 $ 7,127,000 25,344,122 14,240 323,530 321,972 2,604,882
		38,800,356 $

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• (4) The promissory notes issued for others are as follows:

• As of December 31, 2021, the Group’s indirect investees, Formosa Ha Tinh (Cayman) Limited Co. and Formosa Ha Tinh Steel Corporation, were provided with a bank loan facility of USD 3,222,500 thousand and 2,602,500 thousand to meet the operation needs, respectively. To secure the rights of its shareholders, the Company is required to issue a promissory note to ensure the borrower has fulfilled its obligation for repayment.

• (5) Contingencies - litigation

• A. Taiwan Cooperative Bank Co., Ltd. (“TCB”) filed a civil lawsuit against the Group’s subsidiary, Formosa Taffeta Co., Ltd. (“Formosa Taffeta”) with the Taipei District Court in September 2019. TCB claimed that the former employees of Formosa Taffeta colluded with New Site Industries Inc. (“New Site”) and New Brite Industries Inc. (“New Brite”) to make false statements. TCB was misled with the fact that New Site and New Brite have accounts receivable due from Formosa Taffeta, causing damage to TCB. Therefore, TCB claimed that Formosa Taffeta should be liable with the obligation of indemnity. However, this case arose purely as a result of the personal behavior of the former employee. As the case is still under trial proceedings, the ultimate outcome and amount of the lawsuit cannot presently be determined. However, Formosa Taffeta has engaged a lawyer to submit a strong defense to protect its rights and interests.

• B. DBS (Taiwan) Commercial Bank Co., Ltd. (“DBS”) filed a civil lawsuit against the Group’s subsidiaries, Formosa Taffeta Co., Ltd. (“Formosa Taffeta”) and Formosa Taffeta Dong Nai Co., Ltd. (“Formosa Taffeta Dong Nai”) with the Taipei District Court in September 2019. The former employees of Formosa Taffeta and Formosa Taffeta Dong Nai colluded with New Site Industries Inc. (“New Site”) to make false statements. DBS was misled with the fact that New Site has accounts receivable due from Formosa Taffeta and Formosa Taffeta Dong Nai, causing damage to DBS. Therefore, DBS claimed that Formosa Taffeta and Formosa Taffeta Dong Nai should be jointly and severally liable with the obligation of indemnity. However, this case arose purely as a result of the personal behavior of the former employee. As the case is still under trial proceedings, the ultimate outcome and amount of the lawsuit cannot presently be determined. However, Formosa Taffeta and Formosa Taffeta Dong Nai have engaged lawyers to submit a strong defense to protect their rights and interests.

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• C. O-Bank Co., Ltd. (“O-Bank”) filed a civil lawsuit against the Group’s subsidiaries, Formosa Taffeta Co., Ltd. (“Formosa Taffeta”) and Formosa Taffeta Dong Nai Co., Ltd. (“Formosa Taffeta Dong Nai”) with the Taipei District Court in February 2020. The former employees of Formosa Taffeta and Formosa Taffeta Dong Nai colluded with I Chin Young Inc. (“I Chin Young”) to make false statements. O-Bank was misled with the fact that I Chin Young has accounts receivable due from Formosa Taffeta and Formosa Taffeta Dong Nai, causing damage to O-Bank. Therefore, O- Bank claimed that Formosa Taffeta and Formosa Taffeta Dong Nai should be jointly and severally liable with the obligation of indemnity. However, this case arose purely as a result of the personal behavior of the former employee. As the case is still under trial proceedings, the ultimate outcome and amount of the lawsuit cannot presently be determined. However, Formosa Taffeta and Formosa Taffeta Dong Nai have engaged lawyers to submit a strong defense to protect their rights and interests.

• D. Yuanta Commercial Bank Co., Ltd. (“YCB”) filed a criminal lawsuit with a supplementary civil action against the Group’s subsidiary, Formosa Taffeta Co., Ltd. (“Formosa Taffeta”) with the Taipei District Court in October 2020. The former employees of Formosa Taffeta colluded with Loomtech Industries Inc. (“Loomtech”) to make false statements. YCB was misled with the fact that Loomtech has accounts receivable due from Formosa Taffeta, causing damage to YCB. Therefore, YCB claimed that Formosa Taffeta should be liable with the obligation of indemnity. However, this case arose purely as a result of the personal behavior of the former employee. As of March 9, 2022, the court was not in session, hence the ultimate outcome and amount of this litigation is not presently determinable. However, Formosa Taffeta has engaged a lawyer to submit a strong defense to protect its rights and interests.

• E. Taiwan Business Bank, Ltd. (“TBB”) filed criminal lawsuit with a supplementary civil action against the Group’s subsidiaries, Formosa Taffeta Co., Ltd. (“Formosa Taffeta”) and Formosa Taffeta Dong Nai Co., Ltd. (“Formosa Taffeta Dong Nai”) in 2021. The former employees of Formosa Taffeta and Formosa Taffeta Dong Nai colluded with New Site Industries Inc. (“New Site”), New Brite Industries Inc. (“New Brite”) and I Chin Young Inc. (“I Chin Young”) to make false statements. TBB was misled with the fact that New Site, New Brite and I Chin Young has accounts receivable due from Formosa Taffeta and Formosa Taffeta Dong Nai, causing damage to TBB. Therefore, TBB claimed that Formosa Taffeta and Formosa Taffeta Dong Nai should be jointly and severally liable with the obligation of indemnity. However, this case arose purely as a result of the personal behavior of the former employee. As of March 9, 2022, the court was not in session, hence the ultimate outcome and amount of this litigation is not presently determinable. However, Formosa Taffeta and Formosa Taffeta Dong Nai have engaged a lawyer to submit a strong defense to protect its rights and interests.

10. Significant Disaster Loss

None.

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11. Significant Events after the Balance Sheet Date

• (1) On January 28, 2022, the Group redeemed 7,923,741 units of Mega Private US Dollar Money Market Funds at USD 10.9804 (in dollars) per unit, totalling USD 87,006 thousand (equivalent to $2,421,199), and the gain on disposal amounted to $12,555.

• (2) For the operational needs and to enter into the field of regenerative medicine, the Board of Directors of the Group’s subsidiary, Formosa Biomedical Technology Corp., during its meeting on February 25, 2022 resolved to acquire a 51% equity interest in Ivy Life Sciences Co., Ltd. in two stages, for a total investment of $182,232. As of March 9, 2022, Formosa Biomedical Technology Corp. has invested $182,232 and the shareholding ratio was 10%.

• (3) The Board of Directors has resolved the appropriations of 2021 earnings on March 9, 2022. Details are provided in Note 6(18) F.

12. Others

• (1) Due to the impact of the COVID-19 pandemic, there was a significant loss of momentum in the consumption market as a result of restrictions on people’s movement and social contact in many countries, and the spread of petrochemical products, being the difference between the product prices and cost of raw materials, gradually deviated from its historical norm because of fluctuations in international crude oil prices. Consequently, there were decreases in both the Group’s operating revenue and net profit for 2020, resulting in a decrease in consolidated profit before tax of almost 33%. Although the operating revenue and net profit after tax increased by approximately 44% and 98%, respectively, in 2021 compared to 2020 due to the slowdown of the pandemic, the significant increase in market demand compared to the corresponding period of last year, the increases in oil prices and the prices of petrochemical plastic products caused by the industry anomaly and the winter storm in Texas, USA in 2021, the overall impact of the pandemic on the financial position and performance of the Group in 2022 depends on the subsequent control of the pandemic and recovery momentum in the consumption market.

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(2) Capital management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. The Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including ‘current and non-current borrowings’ as shown in the consolidated balance sheet) less cash and cash equivalents. Total capital is calculated as ‘equity’ as shown in the consolidated balance sheet plus net debt.

The Group’s management strategy of its debt-to-capital ratio for the year ended December 31, 2021 is the same as that for the year ended December 31, 2020. As of December 31, 2021 and 2020, the Group’s debt-to-capital ratio was 15% and 16%, respectively.

(3) Financial instruments

A. Financial instruments by category

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

December 31, 2021 December 31, 2020
Financial assets
Financial assets at fair value through profit or loss $ 3,903,900 $ 3,888,592
Financial assets at fair value through other
comprehensive income 189,450,989 169,111,079
Financial assets at amortised cost 71,368,663 58,971,466
$ 264,723,552 $ 231,971,137
December 31, 2021 December 31, 2020
Financial liabilities
Financial liabilities at fair value through profit or loss $ - $ 137
Financial liabilities at amortised cost 137,684,866 121,303,545
Lease liability 903,992 837,790
$ 138,588,858 $ 122,141,472
----- End of picture text -----

Note: Financial assets measured at amortised cost include cash and cash equivalents, financial assets measured at amortised cost, accounts and notes receivable, other receivables, other financial assets and refundable deposits. Financial liabilities measured at amortised cost include short-term borrowings, accounts and notes payable, other payables, long-term borrowings (including those maturing within one year or one business cycle), corporate bonds payable (including those maturing within one year or one business cycle), and guarantee deposits received.

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• B. Financial risk management policies

• (a) The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk, interest rate risk and price risk), credit risk and liquidity risk. To minimize any adverse effects on the financial performance of the Group, derivative financial instruments, such as foreign exchange forward contracts and foreign currency option contracts are used to hedge certain exchange rate risk.

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

• (c) Information about derivative financial instruments that are used to hedge certain exchange rate risk are provided in Notes 6(2) and (12).

• C. Significant financial risks and degrees of financial risks

• (a) Market risk

Foreign exchange risk

• i. The Group is exposed to foreign exchange risk arising from the transactions of the Company and its subsidiaries used in various functional currency, primarily with respect to the USD and RMB. Foreign exchange risk arises from future commercial transactions, recognised assets and liabilities.

• ii. Management has set up a policy to manage its foreign exchange risk against its functional currency. Each entity hedges its entire foreign exchange risk exposure.

• iii. The Group hedges foreign exchange rate by using forward exchange contracts. However, the Group does not adopt hedging accounting. Details of financial assets or liabilities at fair value through profit or loss are provided in Notes 6(2) and (12).

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• iv. The Group’s businesses involve some non-functional currency operations (the Company’s and certain subsidiaries’ functional currency: NTD; other certain subsidiaries’ functional currency: USD, VND 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:

fluctuations is as follows:
. Financial assets Monetary items USD：NTD JPY：NTD USD：RMB USD：VND EUR：NTD Non-monetary items RMB：NTD USD：NTD VND：NTD Financial liabilities Monetary items USD：NTD USD：RMB USD：VND . Financial assets Monetary items USD：NTD USD：RMB USD：VND Non-monetary items RMB：NTD USD：NTD VND：NTD Financial liabilities Monetary items USD：NTD USD：RMB USD：VND		December31,2021
		Foreign Currency Amount (In Thousands) ExchangeRate 793,785 $ 27.69 440,596 0.24 22,799 27.69 37,975 27.69 5,515 31.36 15,685,198 $ 4.34 180,246 27.69 7,494,002,737 0.0012 32,773 $ 27.69 6,103 27.69 416,042 27.69 December31,2020		BookValue (NTD)
				21,979,907 $ 105,743 631,304 1,051,528 172,950 68,073,759 $ 4,991,012 8,992,803 907,484 $ 168,992 11,520,203
		Foreign Currency Amount (In Thousands) 497,623 $ 23,305 22,503 13,967,268 $ 185,571 8,022,038,646 43,405 $ 6,278 367,546	ExchangeRate 28.51 28.51 28.51 4.37 28.51 0.0012 28.51 28.51 28.51	BookValue (NTD)
				14,187,232 $ 664,426 641,561 61,036,961 $ 5,290,629 9,626,446 1,237,477 $ 178,986 10,478,736

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• v. Total exchange gain (loss), including realised and unrealised arising from significant foreign exchange variation on the monetary items held by the Group for the years ended December 31, 2021 and 2020 amounted to ($268,066) and ($701,669), respectively.

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

For the year ended December 31, 2021

Financial assets Monetary items USD：NTD JPY：NTD USD：RMB USD：VND EUR：NTD Non-monetary items RMB：NTD USD：NTD VND：NTD Financial liabilities Monetary items USD：NTD USD：RMB USD：VND Financial assets Monetary items USD：NTD USD：RMB USD：VND Non-monetary items RMB：NTD USD：NTD VND：NTD Financial liabilities Monetary items USD：NTD USD：RMB USD：VND		Sensitivity analysis	Sensitivity analysis
	Degree ofvariation	Effect on profit or loss	Effect on other comprehensiveincome
		Sensitivity analysis
	Degree ofvariation	Effect on profit or loss	Effect on other comprehensiveincome
	1% 1% 1% 1% 1% 1% 1% 1% 1%	$ 141,872 6,644 6,416 $ - - - $ 12,375 1,790 104,787	$ - - - $ 610,370 52,906 96,264 $ - - -

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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 and 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 domestic listed, beneficiary certificate and fund. 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 1% with all other variables held constant, components of equity for the years ended December 31, 2021 and 2020 would have increased/decreased by $ 31,231 and $31,109, 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 $1,894,510 and $1,691,110, respectively, as a result of other comprehensive income classified as equity investment at fair value through other comprehensive income.

Cash flow and fair value interest rate risk

• i. The Group’s interest rate risk arises from long-term borrowings. Borrowings issued at variable rates expose the Group to cash flow interest rate risk which 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. During the years ended December 31, 2021 and 2020, the Group’s borrowings at variable rate were denominated in the NTD and USD.

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

• iii. For the years ended December 31, 2021 and 2020, if interest rates on borrowings had been 1% higher/lower with all other variables held constant, post-tax profit for the years then ended would have been $137,417 and $130,385 lower/higher, respectively, mainly as a result of higher/lower interest expense on floating rate borrowings.

• (b) Credit risk

• i. Credit risk refers to the risk of financial loss to the Group arising from default by the clients or counterparties of financial instruments on the contract obligations. The main factor is that counterparties could not repay in full the accounts receivable based on the agreed terms, classified as the contract cash flows of instruments stated at amortised cost at fair value through other comprehensive income.

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• ii. The Group manages its credit risk taking into consideration the entire group’s concern. For banks and financial institutions, only independently rated parties with a minimum rating of ‘A’ are accepted. According to the Group’s credit policy, each local entity in the Group is responsible for managing and analysing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. Internal risk control assesses the credit quality of the customers, taking into account their financial position, past experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the Board of Directors. The utilisation of credit limits is regularly monitored.

• iii. The Group adopts the assumptions under IFRS 9, that is, to assess whether there has been a significant increase in credit risk on that instrument since initial recognition.

• iv. The Group wrote-off the financial assets, which cannot be reasonably expected to be recovered, after initiating recourse procedures. However, the Group will continue executing the recourse procedures to secure their rights. On December 31, 2021 and 2020, the Group’s written-off financial assets that are still under recourse procedures amounted to $0 and $128,664, respectively.

• v. The Group used the forecastability of Directorate-General of Budget, Accounting and Statistics, Executive Yuan and Taiwan Institute of Economic Research boom observation report to adjust historical and timely information to assess the default possibility of accounts receivable, contract assets and lease payments receivable. On December 31, 2021 and 2020, the provision matrix is as follows:

At December 31, 2021 Expected loss rate Total book value Loss allowance At December 31, 2020 Expected loss rate Total book value Loss allowance	Notpast due	Up to 30 days past due	31~90 days past due	Over 91 days past due
	0.07%~0.69% 36,526,066 $ 61,850 $ 0.15%~0.82% 33,361,753 $ 73,493 $	0.03%~5.77% 564,252 $ 4,803 $ 0.03%~87.58% 191,459 $ 26,028 $	0.04%~69.84% 93,208 $ 15,255 $ 0.03%~100.00% 16,900 $ 5,862 $	93.81%~100.00% 77,260 $ 73,618 $ 53.36%~100.00% 90,151 $ 50,499 $

The ageing analysis of accounts receivable that were past due but not impaired is as follows:

Not past due Up to 30 days 31 to 90 days 91 to 180 days	December31,2021 36,526,066 $ 564,252 93,208 77,260 37,260,786 $	December31,2020
		33,361,753 $ 191,459 16,900 90,151
		33,660,263 $

The above ageing analysis was based on past due date.

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• vi. Movements in relation to the Group applying the simplified approach to provide loss allowance for notes and accounts receivable and contract assets are as follows:

Accountsreceivable At January 1 155,882 $ Reversal of impairment loss 94) ( Effect of exchange rate changes 262) ( At December 31 155,526 $ Accounts receivable At January 1 284,724 $ Write-offs 128,664) ( Effect of exchange rate changes 178) ( At December 31 155,882 $ Forthe year For the year	Contract assets Notesreceivable - $ - $ - - - - - $ - $ Contract assets Notes receivable - $ - $ - - - - - $ - $ endedDecember31,2021 ended December 31, 2020	Contract assets Notesreceivable - $ - $ - - - - - $ - $ Contract assets Notes receivable - $ - $ - - - - - $ - $ endedDecember31,2021 ended December 31, 2020
		- $ - -
		- $

(c) Liquidity risk

• i. Cash flow forecasting is performed in the operating entities of the Group and aggregated by Company treasury. Company treasury monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Group does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. Such forecasting takes into consideration the Group’s debt financing plans, covenant compliance, compliance with internal balance sheet ratio targets and, if applicable, external regulatory or legal requirements, for example, currency restrictions.

• ii. Surplus cash held by the operating entities over and above balance required for working capital management are transferred to the Group treasury. Group treasury invests surplus cash in interest bearing current accounts, loans to related parties, time deposits and cash equivalents, choosing instruments with appropriate maturities or sufficient liquidity to provide sufficient headroom as determined by the abovementioned forecasts.

• iii. The table below analyses the Group’s non-derivative financial liabilities and net-settled or gross-settled derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date for nonderivative financial liabilities and to the expected maturity date for derivative financial liabilities. The amounts disclosed in the table are the contractual undiscounted cash flows.

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Non-derivative financial liabilities:

December 31, 2021 Less than 1year Lease liability 182,877 $ Bonds payable 4,500,000 Long-term borrowings - December 31, 2020 Less than 1year Lease liability 147,577 $ Bonds payable 2,050,000 Long-term borrowings 56,821	Between 1 Between 3 and 2years and5 years Over5 years 139,811 $ 310,305 $ 345,155 $ 4,850,000 26,850,000 13,800,000 12,729,570 4,447,613 - Between 1 Between 3 and 2 years and 5 years Over 5 years 140,970 $ 261,143 $ 267,769 $ 4,550,000 16,600,000 18,900,000 8,000,000 8,241,267 -

Except for the aforementioned liabilities, the Group’s non-derivative financial liabilities will mature within one year.

For the year ended December 31, 2021: None.

Derivative financial liabilities:

==> picture [432 x 57] intentionally omitted <==

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

(4) Fair value estimation

• 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 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 stock investment, private equity fund market, and most derivative instruments is included in Level 2.

• Level 3: Inputs for the asset or liability that are not based on observable market data.

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• B. Financial instruments not measured at fair value

The carrying amounts of cash and cash equivalents, notes receivable (including related parties), accounts receivable (including related parties), other receivables (including related parties), short-term borrowings, short-term notes and bills payable, notes payable (including related parties), accounts payable (including related parties) and other payables (including related parties) are approximate to their fair values. The carrying amounts of long-term borrowings (including current portion) and lease liabilities are reasonable basis for fair value estimate given that their interest rates are approximate to market rates.

• C. The related information on financial and non-financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets and liabilities are as follows:

December 31, 2021 Assets: Recurring fair value measurement Financial assets at fair value through profit or loss Fund Financial assets at fair value through other comprehensive income Equity securities December 31, 2020 Assets: Recurring fair value measurement Financial assets at fair value through profit or loss Derivative instruments Fund Financial assets at fair value through other comprehensive income Equity securities	Level 1 - $ 149,339,525 149,339,525 $ Level 1 - $ - 143,832,740 143,832,740 $	Level 2 3,903,900 $ 3,297,965 7,201,865 $ Level 2 82 $ 3,888,510 2,779,751 6,668,343 $	Level3 - $ 36,813,499 36,813,499 $ Level3 - $ - 22,498,588 22,498,588 $	Total
				3,903,900 $ 189,450,989
				193,354,889 $
				Total
				82 $ 3,888,510 169,111,079
				172,999,671 $

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December 31, 2020 Liabilities: Recurring fair value measurement Financial liabilities at fair value through profit or loss Derivative instruments	Level 1 - $	Level 2 137 $	Level3 Total - $ 137 $

• D. The methods and assumptions the Group used to measure fair value are as follows:

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

Listed shares Open-end fund Market quoted price Closing price Net asset value

• (b) 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.

• (c) When assessing non-standard and low-complexity financial instruments, for example, debt instruments without active market, interest rate swap contracts, foreign exchange swap contracts and options, 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.

• (d) The valuation of derivative financial instruments is based on valuation model widely accepted by market participants, such as present value techniques and option pricing models. Forward exchange contracts are usually valued based on the current forward exchange rate. Structured interest derivative instruments are measured by using appropriate option pricing models (i.e. Black-Scholes model) or other valuation methods, such as Monte Carlo simulation.

• (e) 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

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valuation are carefully assessed and adjusted based on current market conditions.

• (f) The Group takes into account adjustments for credit risks to measure the fair value of financial and non-financial instruments to reflect credit risk of the counterparty and the Group’s credit quality.

• E. For the years ended December 31, 2021 and 2020, there was no transfer between Level 1 and Level 2.

• F. The following chart is the movement of Level 3 for the years ended December 31, 2021 and 2020:

			Forthe yearendedDecember31,2021
			Non-derivative equityinstrument
At January 1		$	22,498,588
Gains and losses recognised in other
comprehensive income
Recorded as unrealised gains (losses)
on valuation of investments in equity
instruments measured at fair value
through other comprehensive income			14,456,713
Acquired during the year			550
Transfers out from level 3	(		142,352)
At December 31		$	36,813,499
			Forthe yearendedDecember31,2020
			Non-derivative equityinstrument
At January 1		$	31,283,890
Gains and losses recognised in other
comprehensive income
Recorded as unrealised gains (losses)
on valuation of investments in equity
instruments measured at fair value
through other comprehensive income	(		8,603,525)
Effect of exchange rate changes	(		181,777)
At December 31		$	22,498,588

• G. Because the investment target has been traded in active market from June 2021, and there is insufficient observable market information available, the Group has transferred the fair value from Level 3 into Level 1 at the end of the month when the event occurred.

• H. The Group Treasury 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 is independent, reliable and in line with other resources and represented as the exercisable price, and frequently calibrating valuation model, performing back-testing, updating inputs used to the valuation model and making any other necessary adjustments to the fair value.

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The Treasury sets up valuation policies, valuation processes and rules for measuring fair value of financial instruments and ensure compliance with the related requirements in IFRS. The related valuation results are reported to Accounting Division monthly. Accounting Division is responsible for managing and reviewing valuation processes.

• I. 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:

alue measurement:
Non-derivative equity instrument: Unlisted shares	Fair value at December 31, 2021	Fair value at December 31, 2020 Valuation technique $ 10,773,066 Market comparable companies 998,799 Discounted cash flow 10,726,723 Net asset value	Significant unobservable input	Relationship of inputs to fair value
	$ 17,579,482 1,448,502 17,785,515		Price to earnings ratio multiple, price to book ratio multiple, enterprise value to operating income ratio multiple, enterprise value to EBITA multiple, discount for lack of marketability Long-term revenue growth rate, weighted average cost of capital, long-term pre-tax operating margin, discount for lack of marketability, discount for lack of control Not applicable	The higher the multiple, the higher the fair value The higher the long-term revenue growth rate and long-term pre-tax operating margin, the higher the fair value Not applicable

• J. 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 on profit or loss or on other comprehensive income from financial assets and liabilities categorised within Level 3 if the inputs used to valuation models have changed:

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Financial Equity instruments Equity instruments Financial Equity instruments Equity instruments	Input	Change ± 1% ± 1% Change ± 1% ± 1%	December31,2021	December31,2021
			Recognisedinothercomprehensiveincome
			Favourable change Unfavourable change 175,795 $ 175,795 $ 14,485 $ 14,485 $ December31,2020	Unfavourable change
	Price to earnings ratio multiple, price to book ratio multiple, enterprise value to operating income ratio multiple, enterprise value to EBITA multiple, discount for lack of marketability Long-term revenue growth rate, weighted average cost of capital, long-term pre-tax operating margin, discount for lack of marketability, discount for lack of control Input			175,795 $
				14,485 $
			Favourable change Unfavourable change 107,731 $ 107,731 $ 9,988 $ 9,988 $ Recognisedinothercomprehensiveincome
	Price to earnings ratio multiple, price to book ratio multiple, enterprise value to operating income ratio multiple, enterprise value to EBITA multiple, discount for lack of marketability Long-term revenue growth rate, weighted average cost of capital, long-term pre-tax operating margin, discount for lack of marketability, discount for lack of control			107,731 $
				9,988 $

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.

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• D. Acquisition or sale of the same security with the accumulated cost exceeding $300 million or 20% of the Company’s paid-in capital: Please refer to table 4.

• E. Acquisition of real estate reaching $300 million or 20% of paid-in capital or more: Please refer to table 5.

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

• G. Purchases or sales of goods from or to related parties reaching $100 million or 20% of paid-in capital or more: Please refer to table 6.

• H. Receivables from related parties reaching $100 million or 20% of paid-in capital or more: Please refer to table 7.

• I. Trading in derivative instruments undertaken during the reporting periods: Please refer to Notes 6(2), and (12); 12(3) and (4).

• J. Significant intragroup transactions during the reporting periods: Please refer to table 8.

(2) Information on investees

Names, locations and other information of investee companies (not including investees in Mainland China): Please refer to table 9.

• (3) Information on investments in Mainland China

• A. Basic information: Please refer to table 10.

• B. Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area: Please refer to table 11.

(4) Major shareholders information

Major shareholders information: Please refer to table 12.

14. Segment Information

(1) General information

The Group’s reportable segments are strategic business units and provide different products and services. Strategic business units are separately managed because each unit needs different techniques and marketing strategies. The Group’s reportable segments are as follows:

• 1st Petrochemical Div: responsible for production of benzene, p-xylene and o-xylene.

• 2nd Petrochemical Div: responsible for production of styrene, synthetic phenolic and acetone.

• 3rd Petrochemical Div: responsible for production of purified terephthalic acid.

• Plastics Division: responsible for production of ABS resin, polypropylene and PS.

Formosa Taffeta Co., Ltd.: responsible for production of blended fabric, spun fabric, cross-woven fabric, polyamine and polyester fabric, epidemic fabric, designer sportswear fabric, high-tech and function fabric, tire cord fabric, pure cotton yarn, blended yarn, various functional yarn, fireproof fabric, anti-static cloth and industrial fabric, and operation of petrol stations to sell petroleum, diesel fuel, kerosene and small package of petroleum products and provide car wash services.

• Formosa Advanced Technologies Co.: responsible for IC packaging, testing and production of memory module.

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(2) Measurement of segment information

The Group has not yet amortised tax expenses or non-recurring gains and losses to reportable segments. Further, not all reportable segments’ profit or loss include significant non-cash items besides depreciation and amortisation. Reporting amount and reports for operating decision-maker are the same.

The Group’s operating segment profit or loss is measured based on operating income before tax for performance assessment basis. The Group considers the sale and transfer among segments as transactions with third parties and measured at market price.

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

For the year ended December 31, 2021

1st Petrochemical 2nd Petrochemical 3rd Petrochemical Formosa Taffeta Div Div Div Plastics Division Co.,Ltd. External revenue 46,293,632 $ 58,073,703 $ 58,093,973 $ 127,995,260 $ 24,182,088 $ Internal revenue 78,194,293 28,598,595 4,242,153 24,009,881 307,993 Total revenue 124,487,925 $ 86,672,298 $ 62,336,126 $ 152,005,141 $ 24,490,081 $ Segment profit (loss) 2,618,121 $ 6,665,517 $ 3,438,122 $ 19,739,516 $ 2,266,193 $ Segment income (loss): Total depreciation and amortisation 3,913,531 $ 3,126,173 $ 3,247,614 $ 2,355,764 $ 786,341 $ Interest expense 186,272 $ 128,552 $ 104,799 $ 186,824 $ 80,142 $ Investment income accounted for using equity method Not included in segments’ income measurement, but regularly provided to operating decision-maker: Income tax expense Total assets of segments 42,172,797 $ 32,578,280 $ 43,666,667 $ 56,564,919 $ 76,699,997 $	Reconciliation Other divisions and offset 51,173,442 $ - $ 14,478,571 149,831,486) ( 65,652,013 $ 149,831,486) ($ 27,128,406 $ 11,695,980) ($ 4,353,951 $ - $ 361,465 $ - $ 473,339,643 $ 126,677,032) ($	Discontinued operation - $ - - $ - $ - $ - $ - $	Total
			365,812,098 $ -
			365,812,098 $
			50,159,895 $
			17,783,374 $
			1,048,054 $
			12,567,317 $
			7,452,464 $
			598,345,271 $

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For the year ended December 31, 2020

1st Petrochemical 2nd Petrochemical 3rd Petrochemical Formosa Taffeta Div Div Div Plastics Division Co.,Ltd. External revenue 21,665,996 $ 37,419,032 $ 39,425,150 $ 89,309,376 $ 21,320,867 $ Internal revenue 43,489,894 21,291,854 2,175,632 13,657,528 204,024 Total revenue 65,155,890 $ 58,710,886 $ 41,600,782 $ 102,966,904 $ 21,524,891 $ Segment profit (loss) 5,067,425) ($ 5,070,593 $ 2,477,418) ($ 15,001,017 $ 2,190,223 $ Segment income (loss): Total depreciation and amortisation 3,632,677 $ 2,730,767 $ 2,891,472 $ 2,261,792 $ 812,969 $ Interest expense 233,763 $ 189,548 $ 134,797 $ 168,590 $ 73,583 $ Investment income accounted for using equity method Income tax expense Total assets of segments 31,704,330 $ 30,767,542 $ 34,826,008 $ 49,462,747 $ 74,801,762 $ Not included in segments’ income measurement, but regularly provided to operating decision-maker:	Reconciliation Discontinued Other divisions and offset operation 44,171,802 $ - $ 17,555) ($ 8,980,068 89,799,000) ( - 53,151,870 $ 89,799,000) ($ 17,555) ($ 20,007,854 $ 9,957,641) ($ 484 $ 4,705,169 $ - $ 231) ($ 493,606 $ - $ - $ 428,278,162 $ 118,020,123) ($ - $	Total
		253,294,668 $ -
		253,294,668 $
		24,767,687 $
		17,034,615 $
		1,293,887 $
		3,779,946 $
		3,213,494 $
		531,820,428 $

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(4) Reconciliation for segment income (loss)

Sales between segments are carried out at arm’s length. The revenue from external parties reported to the chief operating decision-maker is measured in a manner consistent with that in the statement of comprehensive income.

(5) Information on products and services

of comprehensive income. nformation on products and services
Sales revenue Service revenue Other operating income Less: Discontinued operations	Forthe years endedDecember31,
	2021 2020 364,725,115 $ 252,530,471 $ 559,829 444,044 527,154 337,708 365,812,098 253,312,223 - 17,555) ( 365,812,098 $ 253,294,668 $	2020
		252,530,471 $ 444,044 337,708
		253,294,668 $

(6) Geographical information

Geographical information for the years ended December 31, 2021 and 2020 is as follows:

Taiwan China Others Less: Discontinued operations	Non-current Non-current Revenue assets Revenue assets 135,047,857 $ 81,764,710 $ 95,928,804 $ 73,055,239 $ 153,203,013 45,620,211 111,201,939 41,739,599 77,561,228 17,066,853 46,181,480 23,135,128 365,812,098 144,451,774 253,312,223 137,929,966 - - 17,555) ( - 365,812,098 $ 144,451,774 $ 253,294,668 $ 137,929,966 $ YearendedDecember31,2021 YearendedDecember31,2020	YearendedDecember31,2020	YearendedDecember31,2020
	Revenue 135,047,857 $ 153,203,013 77,561,228 365,812,098 - 365,812,098 $		Non-current assets
			73,055,239 $ 41,739,599 23,135,128
			137,929,966 -
			137,929,966 $

(7) Major customer information

The information on customers with over 10% of sales revenue in the statement of comprehensive income for the years ended December 31, 2021 and 2020: None.

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Formosa Chemicals and Fibre Corporation and subsidiaries

Loans to others

For the year ended December 31, 2021

Table 1

Expressed in thousands of NTD (Except as otherwise indicated)

No. （Note 1）	Creditor	Borrower	General ledger account （Note 2）	Is a related party	Maximum outstanding balance duringthe year ended December 31, 2021 （Note 3）	Balance at December 31, 2021 （Note 8）	Actual amount drawn down	Interest rate	Nature of loan （Note 4）	Amount of transactions with the borrower （Note 5）	Reason for short-term financing （Note 6）	Allowance for doubtful accounts	Collateral	Collateral	Limit on loans granted to a single party （Note 7）	Ceiling on total loans granted （Note 7）	Footnote
													Item	Value
0 0 0 0 0 0 0	The Company The Company The Company The Company The Company The Company The Company	Formosa Plastics Corp. Formosa Idemitsu Petrochemical Corp. Nan Ya Plastics Corp. Formosa Biomedical Technology Corp. Formosa Heavy Industries Corp. Formosa Plastics Marine Co., Ltd. Formosa FCFC Carpet Corp.	Other receivables- related party Other receivables- related party Other receivables- related party Other receivables- related party Other receivables- related party Other receivables- related party Other receivables- related party	Yes Yes Yes Yes Yes Yes Yes	8,500,000 $ 500,000 8,500,000 500,000 9,700,000 6,054,301 100,000	4,500,000 $ 500,000 4,500,000 500,000 5,700,000 2,858,693 100,000	- $ - - - - 2,698,693 -	0.98~1.23 0.98~1.23 0.98~1.23 0.98~1.23 0.98~1.23 0.98~1.23 0.98~1.23	1 1 1 2 2 2 2	2 2 2 1 1 1 1	Additional operating capital Additional operating capital Additional operating capital Additional operating capital Additional operating capital Additional operating capital Additional operating capital	- $ - - - - - -	- - - - - - -	- $ - - - - - -	97,742,633 $ 97,742,633 97,742,633 78,194,107 78,194,107 78,194,107 78,194,107	195,485,266 $ 195,485,266 195,485,266 156,388,213 156,388,213 156,388,213 156,388,213	- - - - - - -

Table 1, Page 1

No. （Note 1）	Creditor	Borrower	General ledger account （Note 2）	Is a related party	Maximum outstanding balance duringthe year ended December 31, 2021 （Note 3）	Balance at December 31, 2021 （Note 8）	Actual amount drawn down	Interest rate	Nature of loan （Note 4）	Amount of transactions with the borrower （Note 5）	Reason for short-term financing （Note 6）	Allowance for doubtful accounts	Collateral	Collateral	Limit on loans granted to a single party （Note 7）	Ceiling on total loans granted （Note 7）	Footnote
													Item	Value
0 0 2	The Company The Company Formosa Power (Ningbo) Co., Ltd.	Hong Jing Resources Corp. Formosa Petrochemical Corp. Formosa Chemicals Industries (Ningbo) Co., Ltd.	Other receivables- related party Other receivables- related party Receivables from related party	Yes Yes Yes	500,000 $ 8,500,000 7,798,842	500,000 $ 4,500,000 3,118,018	- $ - 3,118,018	0.98~1.23 0.98~1.23 3.08~3.32	2 1 1	1 2 2	Additional operating capital Additional operating capital Additional operating capital	- $ - -	- - -	- $ - -	78,194,107 $ 97,742,633 8,252,819	156,388,213 $ 195,485,266 16,505,638	- - -

Note 1: The numbers filled in for the loans 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: Name of account in which the loans are recognised including but not limited to accounts receivables-related parties, other receivables-related parties and, current account with stockholders, prepayments, and temporary payments, etc. Note 3: Maximum outstanding balance of loans to others during the year ended December 31, 2021.

Note 4: The nature of loans:

• (1) Related to business transactions is "1".

• (2) Short-term financing is "2".

Note 5: Amount of business transactions with the borrower :

• (1) No business transactions is "1".

• (2) Business transactions amount is provided in Note 13 (1) G.

• Note 6: Provided that loans to others are for necessary short-term financing by nature, shall specifically note necessary reasons for the loans and purposes of the borrowers, for example, repayment of loans, acquisition of equipment, and financing for operation, etc.

Note 7: The calculation of line of credit:

The limit on loans granted by the Company to a single party, related party and party with business transactions shall not be more than 25% of the Company's net assets, and limit to others is 20% of the Company's net assets.

The ceiling on loans granted by the Company to others shall not be more than 50% of the Company's net assets, and ceiling on loans granted a short-term financing borrower with no business transactions shall not be more than 40% of the Company's net assets.

The limit on loans granted by a subsidiary to a single party, related party and party with business transactions shall not be more than 50% of the subsidiary's net assets, and limit to others is 40% of the subsidiary's net assets.

The ceiling on loans granted by a subsidiary to others shall not be more than 100% of the Company's net assets, and limit on loans granted by a subsidiary to a single party, related party and party with business transactions shall not be more than 50% of the subsidiary's net assets, and limit to others is 40% of the subsidiary's net assets.

Note 8: The amount was resolved by the Board of Directors.

Table 1, Page 2

Formosa Chemicals and Fibre Corporation and subsidiaries Provision of endorsements and guarantees to others

Table 2

For the year ended December 31, 2021

Expressed in thousands of NTD (Except as otherwise indicated)

Number （Note 1）	Endorser/ guarantor	Party being endorsed/guaranteed	Party being endorsed/guaranteed	Limit on endorsements/ guarantees provided for a single party （Note 3）	Maximum outstanding endorsement/ guarantee amount as of December 31, 2021 （Note 4）	Outstanding endorsement/ guarantee amount at December 31, 2021 （Note 5）	Actual amount drawn down （Note 6）	Amount of endorsements/ guarantees secured with collateral	Ratio of accumulated endorsement/ guarantee amount to net asset value of the endorser/ guarantor company	Ceiling on total amount of endorsements/ guarantees provided （Note 3）	Provision of endorsements/ guarantees by parent company to subsidiary （Note 7）	Provision of endorsements/ guarantees by subsidiary to parent company （Note 7）	Provision of endorsements/ guarantees to the party in Mainland China （Note 7）	Footnote
		Companyname	Relationship with the endorser/ guarantor （Note2）
0 0 0 1 1 1 1 1	The Company The Company The Company Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd.	Formosa Group (Cayman) Limited Formosa Ha Tinh (Cayman) Limited Formosa Resources Corporation Formosa Taffeta (Zhongshan) Co., Ltd. Formosa Taffeta (Vietnam) Co., Ltd. Formosa Taffeta (Changshu) Co., Ltd. Formosa Taffeta (Dong Nai) Co., Ltd. Formosa Ha Tinh (Cayman) Co., Ltd.	6 6 6 2 2 2 2 6	254,130,847 $ 254,130,847 254,130,847 40,458,507 40,458,507 40,458,507 40,458,507 40,458,507	7,132,750 $ 18,903,708 3,067,083 941,655 1,512,355 1,569,425 4,031,380 6,356,390	6,922,500 $ 6,568,456 - 913,440 1,467,040 1,522,400 3,473,840 2,209,563	6,922,500 $ 6,568,456 - 13,840 484,408 189,498 2,358,647 2,209,563	- $ - - - - - - -	1.77 1.68 - 1.47 2.36 2.45 5.58 3.55	508,261,693 $ 508,261,693 508,261,693 80,917,015 80,917,015 80,917,015 80,917,015 80,917,015	N N N Y Y Y Y N	N N N N N N N N	N N N Y N Y N N	- - - - - - - -

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:

• (1) Having business relationship.

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

• (3) The endorser/guarantor parent company and its subsidiaries jointly own 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) Joint guarantee of the performance guarantee for pre-sold home sales contract as required under the Consumer Protection Act.

Note 3: In accordance with Company's procedures of endorsements and guarantees, limit on the Company's total guarantee amount is 130% of the Company's net assets, the limit on endorsement/guarantee to a single party

• is 50% of the aforementioned total amount. For companies having business relationship with the Company and thus being provided endorsements/guarantees, the limit on endorsements to a single party is the higher value of purchasing or selling.

Note 4: Year-to-date maximum outstanding balance of endorsements/guarantees provided as of the reporting period.

Note 5: Fill in the amount approved by the Board of Directors or the chairman if the chairman has been authorised by the Board of Directors based on subparagraph 8, Article 12 of the Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies.

Note 6: Fill in the actual amount of endorsements/guarantees used by the endorsed/guaranteed company.

Note 7: 'Y' represents cases of provision of endorsements/guarantees by listed parent company to subsidiary, provision by subsidiary to listed parent company, or provision to the party in Mainland China.

Table 2, Page 1

Formosa Chemicals and Fibre Corporation and subsidiaries

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

For the year ended December 31, 2021

Table 3

Expressed in thousands of NTD

(Except as otherwise indicated)

Securities held by	Marketable securities （Note 1）	Relationship with the securities issuer（Note 2）	General ledger account		As of December31,2021	As of December31,2021	Fairvalue Footnote
				Number of shares	Bookvalue	Ownership (%)
The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company	Stocks_Formosa Plastics Corp. Stocks_Asia Pacific Investment Corp. Stocks_Nan Ya Plastics Corp. Stocks_Nan Ya Technology Corp. Stocks_Formosa Union Chemical Corp. Mega Private US Dollar Money Market Funds Stocks_Mai-Liao Harbor Administration Corp. Stocks_Formosa Plastic Corp. U.S.A. Stocks_Taiwan Stock Exchange Corp. Stocks_Taiwan Aerospace Corp. Stocks_Yi-Jih Development Corp.	Other related party Other related party Other related party Other related party - - Other related party Other related party - - Other related party	Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through profit or loss - current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current	486,978,693 63,621,500 413,327,750 334,815,409 14,723,422 12,477,992 39,562,740 8,999 16,803,148 1,070,151 63,174	50,645,785 $ 2,833,065 35,298,190 26,149,083 340,111 3,793,036 1,077,689 7,198,379 3,308,204 15,378 16,998	7.65 14.97 5.21 10.81 3.09 - 17.98 2.92 2.00 0.79 1.51	50,645,785 $ - 2,833,065 - 35,298,190 - 26,149,083 - 340,111 - 3,793,036 - 1,077,689 - 7,198,379 - 3,308,204 - 15,378 - 16,998 -

Table 3, Page 1

Securities held by	Marketable securities （Note 1）	Relationship with the securities issuer（Note 2）	General ledger account		As of December31,2021	As of December31,2021	Fairvalue Footnote
				Number of shares	Bookvalue	Ownership (%)
The Company The Company The Company The Company The Company The Company The Company The Company The Company Formosa Biomedical Technology Corp. Formosa Biomedical Technology Corp. Formosa Biomedical Technology Corp. Formosa Biomedical Technology Corp.	Stocks_Chinese Television System Corp. Stocks_Formosa Plastics Maritime Corp. Stocks_Formosa Development Corp. Stocks_Formosa Network Technology Corp. Stocks_Formosa Plastics Marine Corp. Stocks_Formosa Ocean Group Marine Investment Corp. Stocks_Guangyuan Investment Corp. Stocks_Mega Growth Venture Capital Co., Ltd. Stocks_Formosa Ha Tinh (Cayman) Limited Stocks_Formosa Union Chemical Corp. Asteran Milestone Private Equity Fund Stocks_Formosa Lithium Iron Oxide Corp. Stocks_Formosa Network Technology Corp.	- Other related party Other related party Other related party Other related party Other related party - - Other related party - - Other related party Other related party	Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income- non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through profit or loss - current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current	2,376,202 355,880 19,087,800 2,925,000 2,428,500 2,622 3,750,000 2,500,000 621,178,219 865,373 - 5,300,000 226,120	52,585 $ 370,813 284,026 158,126 760,970 5,343,884 36,075 20,050 13,244,327 19,990 110,864 - 12,224	1.41 18.22 18.00 12.50 15.00 19.00 3.91 1.97 11.43 0.18 - 15.14 0.97	52,585 $ - 370,813 - 284,026 - 158,126 - 760,970 - 5,343,884 - 36,075 - 20,050 - 13,244,327 - 19,990 - 110,864 - - - 12,224 -

Table 3, Page 2

Securities held by	Marketable securities （Note 1）	Relationship with the securities issuer（Note 2）	General ledger account		As of December31,2021	As of December31,2021	Fairvalue Footnote
				Number of shares	Bookvalue	Ownership (%)
Formosa Biomedical Technology Corp. Formosa Biomedical Technology Corp. Formosa Biomedical Technology Corp. Formosa Biomedical Technology Corp. Formosa Biomedical Technology Corp. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd.	Stocks_Taiwan Leader Biotech Corp. Stocks_United Performance Materials Corp. Stocks_United Biopharma (Cayman), Inc. Stocks_UBI Pharma Inc. Maxigen Biotech Inc. Stocks_Formosa Chemicals & Fibre Corp. Stocks_Pacific Electric Wire & Cable Corp., Ltd. Stocks_Formosa Plastics Corp. Stocks_Nan Ya Plastics Corp. Stocks_Asia Pacific Investment Corp. Stocks_Nan Ya Technology Corp. Stocks_Formosa Petrochemical Corp. Stocks_Syntronix Corporation Stocks_Toa Resin Corp., Ltd.	- Other related party - - - Ultimate parent company - Other related party Other related party Other related party Other related party Other related party - Other related party	Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current	2,100,000 423,720 23,559,814 3,289,600 7,534,235 12,169,610 35 640 482,194 10,000,000 7,711,010 365,267,576 234,166 14,400	11,760 $ 5,288 564,654 241,555 312,821 983,305 - 67 41,179 464,900 602,230 35,029,160 12,885 46,428	4.24 0.46 13.42 3.12 9.78 0.21 - - 0.01 2.35 0.25 3.83 0.54 10.00	11,760 $ - 5,288 - 564,654 - 241,555 - 312,821 983,305 3 - - 67 - 41,179 - 464,900 - 602,230 - 35,029,160 - 12,885 - 46,428 -

Table 3, Page 3

Securities held by	Marketable securities （Note 1）	Relationship with the securities issuer（Note 2）	General ledger account		As of December31,2021	As of December31,2021	Fairvalue Footnote
				Number of shares	Bookvalue	Ownership (%)
Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Development Co., Ltd.	Stocks_Shin Yun Natural Gas Corp. Stocks_Wk Technology Fund IV Ltd. FG INC NKFG Co. Stocks_Formosa Ha Tinh (Cayman) Limited Stocks_Formosa Taffeta Co., Ltd.	- - Other related party Other related party Other related party Parent company	Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current	852,120 337,183 600 5,540,000 209,010,676 2,193,228	28,313 $ 503 240,229 39,706 4,512,624 65,907	1.20 3.17 3.00 2.50 3.85 0.13	28,313 $ - 503 - 240,229 - 39,706 - 4,512,624 - 65,907 -

Note 1: Marketable securities in the table refer to stocks, bonds, beneficiary certificates and other related derivative securities, as defined in IFRS 9 "Financial instruments". Note 2: The column is left blank if the issuer of marketable securities is non-related party. Note 3: The Company's stocks held by the subsidiaries— Formosa Taffeta Co., Ltd. —is deemed as treasury stocks. Details are provided in Note 6 (16).

Table 3, Page 4

Formosa Chemicals and Fibre Corporation and subsidiaries

Acquisition or sale of the same security with the accumulated cost exceeding $300 million or 20% of the Company's paid-in capital

For the year ended December 31, 2021

							For the year ended December 31, 2021	For the year ended December 31, 2021
Table 4 Investor	Marketable securities （Note1）	General ledgeraccount	Counterparty （Note2）	Relationship with the investor （Note2）	Balance as at January1,2021		Addition （Note 3）			Disposal （Note 3）			Balance as atDecember31,2021 Expressed in thousands of NTD (Except as otherwise indicated)
					Number of shares	Amount	Number of shares	Amount	Number of shares	Selling price	Bookvalue	Gain (loss) on disposal	Number of shares	Amount
The Company Formosa Biomedical Technology Corp.	Formosa Resources Corporation Stocks_UBI Pharma Inc.	Investments accounted for using equity method Financial assets at fair value through other comprehensive income - non- current	Formosa Resources Corporation -	Related party -	741,594,000 15,957,600	$ 6,169,287 142,352	88,453,125 -	$ 887,813 -	- 12,668,000	$ - 2,025,656	$ - 529,983	$ - Note 5	830,047,125 3,289,600	$ 6,860,325 241,555

Note 1: Marketable securities in the table refer to stocks, bonds, beneficiary certificates and other related derivative securities.

Note 2: Fill in the columns the counterparty and relationship if securities are accounted for under the equity method; otherwise leave the columns blank.

Note 3: Aggregate purchases and sales amounts should be calculated separately at their market values to verify whether they individually reach $300 million or 20% of paid-in capital or more.

Note 4: Paid-in capital referred to herein is the paid-in capital of parent company. In case that shares were issued with no par value or a par value other than NT$10 per share, the 20% of paid-in capital level shall be replaced by 10% of equity attributable to owners of the parent in the calculation.

Note 5:The amount of gains or losses on disposal which are reclassified as retained earnigs is $1,433,929 .

Table 4, Page 1

Table 5

Expressed in thousands of NTD (Except as otherwise indicated)

Formosa Chemicals and Fibre Corporation and subsidiaries

Acquisition of Individual Real Estate at Costs of at Least NT$300 Million or 20% of the Paid-in Capital For the year ended December 31, 2021

Real estate acquired by	Property	Event Date	Transaction Amount	Payment Status	Counterparty	Relationship	Informationon PreviousTitleTransfer ifCounterpartyis aRelatedParty	Informationon PreviousTitleTransfer ifCounterpartyis aRelatedParty	Informationon PreviousTitleTransfer ifCounterpartyis aRelatedParty	Informationon PreviousTitleTransfer ifCounterpartyis aRelatedParty	PricingReference	Purpose of Acquisition	Other Terms
							Property Owner	Relationship	Transaction Date	Amount
Formosa Biomedical Technology Corp.	Land on Land No. 562, Subsection 2, Fulin Sec., Shilin Dist., Taipei City and 2 units and 9 indoor parking spaces on No. 518, Sec. 5, Zhongshan N. Rd., Shilin Dist., Taipei City	Note	$ 510,717	paid	Natural person	-	-	-	-	$ -	Bargaining	In consideration of future operational development needs	-

Note: On April 28, 2021, the Board of Directors resolved to acquire the asset, and the price of the asset includes related fees, which had been fully paid.

Table 5, Page 1

Formosa Chemicals and Fibre Corporation and subsidiaries

Table 6

Expressed in thousands of NTD (Except as otherwise indicated)

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

For the year ended December 31, 2021

Purchaser/seller	Counterparty	Relationshipwith the counterparty	Transaction	Differences in transaction terms compared to third party transactions（Note 1）	Balance Percentage of total notes/accounts receivable (payable) Notes/accounts receivable(payable) Footnote （Note 1）
			Purchases (sales) Amount Percentage of total purchases (sales) Credit term	Unitprice Credit term
The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company Formosa Biomedical Technology Corp. The Company	Formosa Plastics Corp. Nan Ya Plastics Corp. Formosa Taffeta (Dong Nai) Corp. Formosa Petrochemical Corp. Formosa Chemicals Industries (Ningbo) Co., Ltd. Formosa Industries Corp. PFG Fiber Glass Corp. Formosa Idemitsu Petrochemical Corp. Formosa Plastics Corp., U.S.A. Formosa Plastics Corp. Nan Ya Plastics Corp. Formosa Petrochemical Corp. Nan Ya Technology Corp. Formosa Taffeta Co., Ltd.	Other related party Other related party Subsidiary Associate Subsidiary Subsidiary Other related party Subsidiary Other related party Other related party Other related party Associate Other related party Subsidiary	Sales 2,582,896) ($ 1) ( 30 days Sales 30,131,334) ( 12) ( 30 days Sales 431,515) ( - 60 days Sales 29,088,177) ( 12) ( 30 days Sales 32,317,715) ( 13) ( 90 days Sales 3,839,337) ( 2) ( 30 days Sales 471,319) ( - 30 days Sales 17,967,308) ( 7) ( 30 days Sales 1,998,320) ( 1) ( 30 days Purchases 6,797,321 3 30 days Purchases 14,105,112 7 30 days Purchases 141,866,388 70 30 days Sales 190,011) ( 7) ( 30 days Sales 60 days 1,395,375) ( 1) (	$ - - - - - - - - - - - - - - - - - - - - - - - - - - - -	212,832 $ 1 - 2,752,754 11 - Notes receivable 318,393 55 - Accounts receivable 163,800 1 - 100,677 - - 2,704,029 11 - 9,143,083 36 - 633,434 3 - 37,337 - - 1,485,620 6 - 373,862 1 - 593,147) ( 3) ( - 1,018,160) ( 5) ( - 13,877,906) ( 74) ( - 16 -

Table 6, Page 1

Transaction

Differences in transaction terms compared to third party transactions （ Note 1 ） Notes/accounts receivable (payable)

Purchaser/seller	Counterparty	Relationshipwith the counterparty	Purchases (sales) Amount Percentage of total purchases (sales) Credit term Unitprice Credit term Balance Percentage of total notes/accounts receivable (payable) Footnote （Note 1）
Formosa INEOS Chemicals Corp. Formosa INEOS Chemicals Corp. Formosa INEOS Chemicals Corp. Formosa INEOS Chemicals Corp. Formosa INEOS Chemicals Corp. Formosa Power (Ningbo) Co., Ltd. Formosa Power (Ningbo) Co., Ltd. Formosa Power (Ningbo) Co., Ltd. Formosa Chemicals Industries (Ningbo) Co., Ltd. Formosa Chemicals Industries (Ningbo) Co., Ltd. Formosa Chemicals Industries (Ningbo) Co., Ltd. Formosa Industries Corp. Formosa Industries Corp. Formosa Industries Corp. Formosa Industries Corp. Formosa Industries Corp.	The Company INEOS Acetyls (Malaysia) Sdn Bhd Nan Ya Plastics Corp. Formosa Petrochemical Corp. Formosa Petrochemical Corp. Formosa Chemicals Industries (Ningbo) Co., Ltd. Formosa Plastics (Ningbo) Co., Ltd. Nan Ya Plastics (Ningbo) Corp. Nan Ya Plastics (Ningbo) Corp. Formosa Plastics Corp. Formosa Petrochemical Corp. The Company Nan Ya Plastics Corp. Formosa Taffeta (Zhongshan) Corp. Formosa Taffeta (Dong Nai) Corp. Formosa Taffeta (Long An) Corp.	Parent company Associate Other related party Associate Associate Associate Other related party Other related party Other related party Other related party Associate Parent company Other related party Associate Associate Associate	Sales 1,636,094) ($ 17) ( 30 days $ - - 166,645 $ 9 - Sales 1,085,136) ( 11) ( 90 days after shipped - - 807,027 43 - Sales 265,805) ( 3) ( 30 days - - 24,948 1 - Sales 747,251) ( 8) ( 30 days - - 81,720 4 - Purchases 2,261,419 52 45 days - - 234,964) ( 83) ( - Sales 3,136,337) ( 53) ( 30 days - - 290,460 51 - Sales 2,113,483) ( 36) ( 30 days - - 217,647 39 - Sales 455,732) ( 8) ( 30 days - - 46,036 8 - Sales 6,862,991) ( 7) ( 90 days - - 732,364 5 - Purchases 2,096,043 3 90 days - - 508,970) ( 4) ( - Purchases 2,714,948 3 90 days - - 298,787) ( 2) ( - Sales 1,210,785) ( 5) ( 60 days - - 202,626 9 - Sales 449,274) ( 2) ( 30 days - - 31,697 1 - Sales 174,699) ( 1) ( 90 days - - 53,416 2 Sales 637,590) ( 3) ( 60 days - - 168,772 7 - Sales 290,817) ( 1) ( 60 days - - 85,343 4 -

Table 6, Page 2

Purchaser/seller	Counterparty	Relationshipwith the counterparty	Transaction	Differences in transaction terms compared to third party transactions（Note 1）	Balance Percentage of total notes/accounts receivable (payable) Notes/accounts receivable(payable) Footnote （Note 1）
			Purchases (sales) Amount Percentage of total purchases (sales) Credit term	Unitprice Credit term
Formosa Industries Corp. Formosa Industries Corp. Formosa Industries Corp. Formosa Idemitsu Petrochemical Corp. Formosa Idemitsu Petrochemical Corp. Formosa Idemitsu Petrochemical Corp. Formosa Idemitsu Petrochemical Corp. Formosa Idemitsu Petrochemical Corp. Formosa Idemitsu Petrochemical Corp. Formosa Idemitsu Petrochemical Corp. Formosa Idemitsu Petrochemical Corp. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd.	Formosa Plastics Corp. Nan Ya Plastics Corp. Nan Ya Draw-Textured Yarn (Kunshan) Co., Ltd. The Company Idemitsu Kosan Co., Ltd. Idemitsu Chemicals Taiwan Corp. Idemitsu Kosan Co., Ltd. Idemitsu Chemicals (Hong Kong) Co., Ltd. Idemitsu Chemicals (U.S.A.) Co., Ltd. Idemitsu Chemicals Southeast Asia Pte Ltd. Formosa Chemicals Industries (Ningbo) Co., Ltd. Kuang Yueh Enterprise Co., Ltd. Formosa Taffeta (Dong Nai) Corp. Yugen Co., Ltd. Formosa Petrochemical Corp.	Other related party Other related party Other related party Parent company Associate Associate Associate Associate Associate Associate Associate Associate Associate Other related party Other related party	Purchases 452,925 $ 2 30 days Purchases 2,282,865 10 30 days Purchases 316,101 1 60 days Sales 3,488,401) ( 18) ( 30 days Sales 470,295) ( 2) ( 30 days after closing date Sales 843,529) ( 4) ( 30 days after closing date Sales 1,058,003) ( 5) ( 30 days after closing date Sales 943,793) ( 5) ( 30 days after closing date Sales 263,350) ( 1) ( 30 days after closing date Sales 132,469) ( 1) ( 30 days after closing date Sales 104,137) ( 1) ( 90 days Sales 286,180) ( 1) ( Pay by mail transfer 60 days after delivery Sales 236,515) ( 1) ( 60 days after monthly billings Sales 192,900) ( 1) ( Pay 120 days after delivery Purchases 9,640,038 48 Pay every 15 days by mail transfer	$ - - - - - - - - - - - - - - - - - - - - - - - - - - - -	55,696) ($ 3) ( - 340,825) ( 16) ( - 18,123) ( 1) ( 163,743 12 - 37,365 3 - 54,958 4 - 150,705 11 - 139,297 10 - 56,805 4 - 17,007 1 34,212 3 15,599 1 - 56,300 2 53,332 2 - 425,208) ( 51) ( -

Table 6, Page 3

Differences in transaction

Transaction

terms compared to third party transactions （ Note 1 ） Notes/accounts receivable (payable)

Purchaser/seller	Counterparty	Relationshipwith the counterparty	Purchases (sales) Amount Percentage of total purchases (sales) Credit term Unitprice Credit term Balance Percentage of total notes/accounts receivable (payable) Footnote （Note 1）
Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta (Changshu) Co., Ltd. Formosa Taffeta (Zhong Shan) Co., Ltd. Formosa Taffeta (Zhong Shan) Co., Ltd. Formosa Taffeta (Zhong Shan) Co., Ltd. Formosa Taffeta (Dong Nai) Co., Ltd. Formosa Taffeta (Dong Nai) Co., Ltd. Formosa Taffeta (Dong Nai) Co., Ltd. Formosa Taffeta (Dong Nai) Co., Ltd. Formosa Taffeta (Vietnam) Co., Ltd. Formosa Taffeta (Vietnam) Co., Ltd.	Nan Ya Plastics Corp. Formosa Plastics Corp. Kuang Yueh (Vietnam) Co., Ltd. Formosa Taffeta (Changshu) Co., Ltd. Formosa Taffeta Co., Ltd. Nan Ya Draw-Textured Yarn(Kunshan)Co.,Ltd. Formosa Taffeta (Vietnam) Co., Ltd. Kuang Yueh (Vietnam) Co., Ltd. Formosa Taffeta (Zhong Shan) Co., Ltd. Nan Ya Plastics Corp. Kuang Yueh (Vietnam) Co., Ltd. Formosa Industries Corp.	Other related party Other related party Other related party Associate Associate Other related party Associate Other related party Associate Other related party Other related parties Associate	Purchases 740,561 $ 4 Pay by mail transfer on the 15th of the following month $ - - ($ 60,118) 7) ( - Purchases 202,841 1 Pay by mail transfer on the 15th of the following month - - 13,651) ( 2) ( - Sales 116,810) ( 9) ( Pay by mail transfer 60 days after delivery - - 1,615 1 - Sales 352,567) ( 20) ( 60 days after monthly billings - - 103,585 33 - Sales 113,968) ( 7) ( 60 days after monthly billings - - 21,287 7 - Purchases 126,957 11 60 days after monthly billings - - 28,958) ( 41) ( - Sales 377,718) ( 9) ( 60 days after monthly billings - - 183,293 17 - Sales 170,501) ( 4) ( 60 days after monthly billings - - 30,079 3 - Sales 103,649) ( 2) ( 60 days after monthly billings - - 19,241 2 - Purchases 154,038 5 60 days after monthly billings - - 17,451) ( 7) ( - Sales 139,711) ( 6) ( 60 days after monthly billings - - 50,290 11 - Purchases 258,389 15 60 days after monthly billings - - 38,453) ( 19) ( -

Note 1: The disclosed transaction is the revenue side and related transactions are no longer disclosed.

Table 6, Page 4

Formosa Chemicals and Fibre Corporation and subsidiaries

Table 7

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

For the year ended December 31, 2021

Expressed in thousands of NTD (Except as otherwise indicated)

Creditor	Counterparty	Relationship with the counterparty	Balance as at December 31, 2021 （Note 1）	Turnover rate	Overdue receivables	Overdue receivables	Amount collected subsequent to the balance sheet date	Allowance for doubtful accounts
					Amount	Action taken
The Company The Company The Company The Company The Company The Company The Company Formosa INEOS Chemicals Corp. Formosa INEOS Chemicals Corp. Formosa Idemitsu Petrochemical Corp. Formosa Idemitsu Petrochemical Corp. Formosa Idemitsu Petrochemical Corp. Formosa Power (Ningbo) Co., Ltd. Formosa Power (Ningbo) Co., Ltd. Formosa Chemicals Industries (Ningbo) Co., Ltd. Formosa Industries Corp. The Company The Company	Formosa Plastics Corp. Nan Ya Plastics Corp. Formosa Taffeta (Dong Nai) Co., Ltd. Formosa Industries Corp. Formosa Chemicals Industries (Ningbo) Co., Ltd. Formosa Idemitsu Petrochemical Corp. Formosa Plastic Corp. U.S.A. The Company INEOS Acetyls (Malaysia) Sdn Bhd Idemitsu Chemicals (Hong Kong) Co., Ltd. The Company Idemitsu Kosan Co., Ltd. Formosa Chemicals Industries (Ningbo) Co., Ltd. Formosa Plastics (Ningbo) Co., Ltd. Nan Ya Plastics (Ningbo) Corp. The Company Formosa Taffeta Co., Ltd. Formosa Petrochemical Corp.	Other related party Other related party Subsidiary Subsidiary Subsidiary Subsidiary Associate Parent company Associate Associate Parent company Associate Associate Other related party Other related party Parent company Subsidiary Associate	212,832 $ 2,752,754 Notes receivable 318,393 Accounts receivable 163,800 100,677 Accounts receivable 2,704,029 Other receivables 196,123 633,434 9,143,083 1,485,620 373,862 166,645 807,027 139,297 163,743 150,705 290,460 217,647 732,364 202,626	10.26 12.33 4.73 8.00 4.41 10.68 8.79 10.95 1.89 7.70 14.82 10.20 11.41 9.81 11.06 9.45 3.66 13.26	- $ - - - - - - - - - - - - - - - - -	- - - - - - - - - - - - - - - - - -	212,832 $ 2,752,754 133,490 138,999 40,042 2,671,443 180,586 334,384 2,908,549 1,485,620 150,880 156,509 - 121,808 163,743 120,558 207,692 217,647 732,364 130,721	- $ - - - - - - - - - - - - - - - - - - -

Table 7, Page 1

Creditor	Counterparty	Relationship with the counterparty	Balance as at December 31, 2021 （Note 1）	Turnover rate	Overdue receivables	Overdue receivables	Amount collected subsequent to the balance sheet date	Allowance for doubtful accounts
					Amount	Action taken
Formosa Industries Corp. Formosa Taffeta (Zhong Shan) Co., Ltd. Formosa Taffeta (Dong Nai) Corp.	Formosa Taffeta (Dong Nai) Co., Ltd. Formosa Taffeta (Changshu) Co., Ltd. Formosa Taffeta (Vietnam) Co., Ltd.	Associate Associate Associate	168,772 $ 103,585 183,293	4.61 3.46 3.41	- $ -	- -	56,931 $ 46,493 70,496	- $ -

Note 1: Fill in separately the balances of accounts receivable–related parties, notes receivable–related parties, other receivables–related parties.

Table 7, Page 2

Formosa Chemicals and Fibre Corporation and subsidiaries

Table 8

Significant inter-company transactions during the reporting period

For the year ended December 31, 2021

Expressed in thousands of NTD

(Except as otherwise indicated)

Number (Note 1)	Companyname	Counterparty	Relationship (Note 2)			Transaction
				General ledger account	Amount	Transaction terms	Percentage of consolidated total operating revenues or total assets(Note3)
0 0	The Company The Company	Formosa Chemicals Industries (Ningbo) Co., Ltd. Formosa Idemitsu Petrochemical Corp.	1 1	Sales revenue Sales revenue	32,317,715) ($ 17,967,308) (	In regular terms In regular terms	(9) (5)

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

• (1) Parent company is ‘0’.

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

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

• (1) Parent company to subsidiary.

• (2) Subsidiary to parent company.

• (3) Subsidiary to subsidiary.

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

Note 4: If the transaction amount in this sheet reaches 3% of consolidated operating income or total assets, it is considered material.

Table 8, Page 1

Formosa Chemicals and Fibre Corporation and subsidiaries

Information on investees (Excluding those in Mainland China)

Table 9

Expressed in thousands of NTD (Except as otherwise indicated)

For the year ended December 31, 2021

Investor	Investee （Note1,2）	Location	Mainbusiness activities	Initial investment amount	Initial investment amount	Sharesheld as atDecember31,2021	Sharesheld as atDecember31,2021	Sharesheld as atDecember31,2021	Net profit (loss) of the investee for the year endedDecember31,2021	Investment income (loss) recognised by the Company for the year ended December31,2021	Footnote
				Balance as at December31,2021	Balance as at December31,2020	Numberofshares	Ownership (%)	Bookvalue
The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company	Tah Shin Spinning Corp. Formosa Taffeta Co., Ltd. Formosa Heavy Industries Corp. Formosa Fairway Corporation Formosa Plastics Transport Corp. Formosa Petrochemical Corp. Mai-Liao Power Corp. FCFC Investment Corp. (Cayman) Hwa Ya Science Park Management Consulting Co., Ltd. Chia-Nan Enterprise Corporation Formosa Idemitsu Petrochemical Corp. Formosa Industries Corp., Vietnam Formosa INEOS Chemicals Corp. Formosa Environmental Technology Co. Formosa Biomedical Technology Corp.	Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan Cayman Islands Taiwan Taiwan Taiwan Vietnam Taiwan Taiwan Taiwan	Spinning Spinning Machinery Transportation Transportation Chemistry Electricity generation Investments Management Electricity generation Wholesale and retail of petrochemical and plastic raw materials Textile, polyester staple fibre, cotton Chemistry, international of petrochemistry Disposal of wastes and sewage Manufacturing and sale of cosmetics	- $ 719,003 2,497,721 33,320 299,272 25,842,468 5,985,531 34,012,602 340 370,561 299,999 8,435,801 1,201,500 417,145 1,566,879	5,549 $ 719,003 2,497,721 33,320 299,272 25,842,468 5,985,531 34,012,602 340 370,561 299,999 8,435,801 1,201,500 417,145 1,566,879	- 630,022,431 656,516,684 4,697,951 6,566,384 2,300,799,801 764,201,101 56,000 33,000 21,163,000 60,000,000 - 120,150,000 41,714,475 147,556,136	- 37.40 32.91 33.33 33.33 24.15 24.94 100.00 33.00 51.00 50.00 42.50 50.00 24.34 88.59	- $ 22,859,755 7,694,115 49,214 1,250,682 86,080,723 12,819,210 67,879,918 3,195 339,591 1,744,062 7,314,049 3,227,258 228,831 3,477,997	- $ 2,143,167 226,233 63,697) ( 240,384 49,401,403 308,781 7,459,324 1,933 1,564) ( 1,022,517 1,402,858 3,558,513 10,018 311,833	- $ 790,124 74,723 21,230) ( 80,120 11,968,645 77,040 7,459,324 638 798) ( 508,600 596,214 1,748,798 2,438 273,579	- - - - - - - - - - - - - - -

Table 9, Page 1

Investor	Investee （Note1,2）	Location	Mainbusiness activities	Initial investment amount	Initial investment amount	Sharesheld as atDecember31,2021	Sharesheld as atDecember31,2021	Sharesheld as atDecember31,2021	Net profit (loss) of the investee for the year endedDecember31,2021	Investment income (loss) recognised by the Company for the year ended December31,2021	Footnote
				Balance as at December31,2021	Balance as at December31,2020	Numberofshares	Ownership (%)	Bookvalue
The Company The Company The Company The Company The Company The Company The Company FCFC Investment Corp. (Cayman) Formosa Biomedical Technology Corp. Formosa Biomedical Technology Corp. Formosa Biomedical Technology Corp. Formosa Biomedical Technology Corp.	Formosa FCFC Carpet Corp. Guo Su Plastic Industry Co., Ltd. Formosa Synthetic Rubber (Hong Kong) Co., Ltd. Formosa Resources Corporation Formosa Group Corp. (Cayman) Formosa Construction Corp. FG INC. Formosa Chemicals & Fibre (Hong Kong) Co., Ltd. Beyoung International Corp. Hong Jing Resources Corp. Formosa Biomedical Technology (Samoa) Co., Ltd. Formosa Waters Technology Co., Ltd.	Taiwan Taiwan Hong Kong Taiwan Cayman Islands Taiwan United States Hong Kong Taiwan Taiwan Samoa Taiwan	Yarn spinning mills, finishing of textiles and carpet manufacturing Manufacture of synthetic resin and plastic products Manufacturing of synthetic rubber Mining industry and its trading, wholesale of chemical material and international trading Investments Development and sale of rebuilt housing, buildings and plants under urban redevelopment Investments Investments International trading Recycle of spent catalyst Investments 1.Industrial Catalyst Manufacturing 2.Wholesale of Other Chemical Products	300,000 $ 48,469 4,214,914 8,303,053 377 600,000 3,413,031 29,959,815 90,000 476,196 29,610 7,650	300,000 $ - 4,214,914 7,415,940 377 600,000 3,413,031 29,959,815 90,000 476,196 29,610 7,650	22,037,185 1,875,000 138,333,334 830,047,125 12,500 60,000,000 6,000 - 467,400 27,336,218 - 765,001	100.00 32.89 33.34 25.00 25.00 33.33 30.00 100.00 30.00 71.00 100.00 57.00	187,404 $ 48,469 2,182,064 6,860,325 662,099 593,734 2,993,906 52,306,068 95,492 636,350 2,566 22,670	10,598) ($ - 504,051) ( 298,994 127,467 25,775 98,230) ( 7,634,374 3,881 134,798 2,379 20,986	10,600) ($ - 168,050) ( 71,467 31,867 8,591 30,571) ( 7,634,374 1,164 95,707 2,379 11,962	- - - - - - - - - - - -

Table 9, Page 2

Investor	Investee （Note1,2）	Location	Mainbusiness activities	Initial investment amount	Initial investment amount	Sharesheld as atDecember31,2021	Sharesheld as atDecember31,2021	Sharesheld as atDecember31,2021	Net profit (loss) of the investee for the year endedDecember31,2021	Investment income (loss) recognised by the Company for the year ended December31,2021	Footnote
				Balance as at December31,2021	Balance as at December31,2020	Numberofshares	Ownership (%)	Bookvalue
Formosa Biomedical Technology Corp. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd. Formosa Taffeta Co., Ltd.	Formosa Bio & Energy Crop. (Japan) Formosa Development Co., Ltd. Formosa Advanced Technologies Co., Ltd. Formosa Taffeta (Hong Kong) Co., Ltd. Formosa Taffeta (Vietnam) Co., Ltd. Kuang Yueh Co., Ltd. Formosa Taffeta (Dong Nai) Co., Ltd. Formosa Industries Corp., Ltd. Schoeller Textil AG	Japan Taiwan Taiwan Hong Kong Vietnam Taiwan Vietnam Vietnam Switzerland	Manufacturing and sale of battery energy storage systems and related products 1.Handling urban land consolidation 2.Development, rent and sale of industrial plants, residences and building IC assembly, testing and modules Sale of spun fabrics and filament textile Production, processing, further processing various yam and cotton cloth, dyeing and finishing clothes, curtains, towels, bed covers and carpets Processing and production of ready-to- wear, processing and trading of cotton cloth, and import and export of the aforementioned products Production, processing and sale of various dyeing and finishing textiles and yarn Synthetic fiber, spinning, weaving, dyeing and finishing and electricity generation Textile R&D, production and sales	5,018 $ 114,912 1,762,711 1,356,862 1,709,221 213,771 2,590,434 1,987,122 1,285,507	5,018 $ 114,912 1,762,711 1,356,862 1,709,221 213,771 2,590,434 1,987,122 1,285,507	18,105 16,100,000 135,686,472 - - 18,595,352 - - 21,874	51.00 100.00 30.68 100.00 100.00 17.99 100.00 10.00 50.00	3,535 $ 186,160 5,135,358 1,202,931 2,095,015 1,237,283 2,524,546 1,825,888 1,030,378	148) ($ 12,652) ( 1,557,008 26,029 37,801 630,502 335,275 1,402,858 277,882) (	76) ($ 14,846) ( 477,748 26,029 37,801 144,254 335,275 140,286 169,034) (	- - - - - - - - -

Table 9, Page 3

Investor	Investee （Note1,2）	Location	Mainbusiness activities	Initial investment amount	Initial investment amount	Sharesheld as atDecember31,2021	Sharesheld as atDecember31,2021	Sharesheld as atDecember31,2021	Net profit (loss) of the investee for the year endedDecember31,2021	Investment income (loss) recognised by the Company for the year ended December31,2021	Footnote
				Balance as at December31,2021	Balance as at December31,2020	Numberofshares	Ownership (%)	Bookvalue
Formosa Taffeta Co., Ltd. Formosa Development Co., Ltd. Formosa Development Co., Ltd. Public More Internation Co., Ltd.	Nan Ya Optical Corp. Formosa Advanced Technologies Co., Ltd. Public More Internation Co., Ltd. Kuang Yueh Co., Ltd.	Taiwan Taiwan Taiwan Taiwan	LED lighting system, lighting piping engineering design planning, manufacturing and installation IC assembly, testing and modules Employment service, manpower allocation and agency service Processing and production of ready-to- wear, processing and trading of cotton cloth, and import and export of the aforementioned products	263,327 $ 21,119 5,000 1,069	263,327 $ 21,119 5,000 1,069	7,013,871 469,500 - 10,000	15.22 0.11 100.00 0.01	290,161 $ 17,577 14,053 1,070	95,906 $ 1,557,008 5,797 630,502	14,594 $ 1,868 5,797 75	- - - -

• Note 1: If a public company is equipped with an overseas holding company and takes consolidated financial report as the main financial report according to the local law rules, it can only disclose the information of the overseas holding company about the disclosure of related overseas investee information.

• Note 2: If situation does not belong to Note 1, fill in the columns according to the following regulations:

• (1)The columns of 'Investee', 'Location', 'Main business activities', Initial investment amount' and 'Shares held as at December 31, 2021 should fill orderly in the Company's (public company's) information on investees and every directly or indirectly controlled investee's investment information, and note the relationship between the Company (public company) and its investee each (ex. direct subsidiary or indirect subsidiary) in the 'footnote' column.

• (2)The 'Net profit (loss) of the investee for the year ended December 31, 2021 column should fill in amount of net profit (loss) of the investee for this period.

• (3)The 'Investment income (loss) recognised by the Company for the year ended December 31, 2021 column should fill in the Company (public company) recognised investment income (loss) of its direct subsidiary and

• recognised investment income (loss) of its investee accounted for under the equity method for this period. When filling in recognised investment income (loss) of its direct subsidiary, the Company (public company) should confirm that direct subsidiary's net profit (loss) for this period has included its investment income (loss) which shall be recognised by regulations.

Table 9, Page 4

Formosa Chemicals and Fibre Corporation and subsidiaries

Table 10

Information on investments in Mainland China

For the year ended December 31, 2021

Expressed in thousands of NTD (Except as otherwise indicated)

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 year ended December31,2021	Amount remitted from Taiwan to Mainland China/Amount remitted back to Taiwan for the year ended December31,2021	Accumulated amount of remittance from Taiwan to Mainland China as of December 31,2021	Net income of investee for the year ended December 31,2021	Ownership held by the Company (direct or indirect)	Investment income(loss) recognised by the Company for the year ended December 31,2021	Book value of investments in Mainland China as of December 31,2021	Accumulated amount of investment income remitted back to Taiwan as of December 31,2021	Footnote
					Remitted to Mainland China	Remitted back to Taiwan
Formosa Power (Ningbo) Co., Ltd. Formosa Chemicals Industries (Ningbo) Co., Ltd. Formosa Synthetic Rubber (Ningbo) Co., Ltd. Formosa Biomedical Trading (Shanghai) Co., Ltd. Formosa Taffeta (Zhong Shan) Co., Ltd. Formosa Taffeta (Changshu) Co., Ltd.	Cogeneration power generation business Production and market of PTA Production and sale of synthetic rubber Investments Production and sale of polyester and polyamide fabrics Weaving and dyeing as well as post dressing of high-grade loomage face fabric	4,834,511 $ 35,575,404 12,777,478 29,610 1,402,085 1,302,019	1 1 4 1 1 2	4,051,414 $ 29,959,815 4,163,050 29,610 1,402,085 1,334,739	- $ - - - - -	- $ - - - - -	4,051,414 $ 29,959,815 4,163,050 29,610 1,402,085 1,334,739	175,050) ($ 7,634,374 504,051) ( 2,379 144,023 24,149	100.00 100.00 33.33 100.00 100.00 100.00	175,050) ($ 7,634,374 168,051) ( 2,379 144,023 24,149	15,815,577 $ 52,306,068 2,182,063 2,566 1,923,461 1,091,320	- $ - - - 43,914 -	- - - - 3 4

Table 10, Page 1

Formosa Chemicals and Fibre Corporation and subsidiaries

Information on investments in Mainland China

Table 10

For the year ended December 31, 2021

Expressed in thousands of NTD (Except as otherwise indicated)

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 year ended December31,2021	Amount remitted from Taiwan to Mainland China/Amount remitted back to Taiwan for the year ended December31,2021	Accumulated amount of remittance from Taiwan to Mainland China as of December 31,2021	Net income of investee for the year ended December 31,2021	Ownership held by the Company (direct or indirect)	Investment income(loss) recognised by the Company for the year ended December 31,2021	Book value of investments in Mainland China as of December 31,2021	Accumulated amount of investment income remitted back to Taiwan as of December 31,2021	Footnote
					Remitted to Mainland China	Remitted back to Taiwan
Changshu Yu Yuan Development Co., Ltd.	Building and selling real estate	70,788 $	2	- $	- $	- $	- $	2,379 $	40.78	970 $	17,478 $	- $	5

Note 1: Investment methods are classified into the following three categories.

• (1) Directly invest in a company in Mainland China..

(2) Through investing in an existing company in the third area, which then invested in the investee in Mainland China.

• (3) Others

(4) Formosa Power (Ningbo) Co., Ltd. is an investee company in Mainland China through the Company's investee - FCFC Investment Corp. (Cayman).

• Formosa Chemicals Industries (Ningbo) Co., Ltd., Formosa PS (Ningbo) Co., Ltd., Formosa ABS Plastics (Ningbo) Co., Ltd. and Formosa Phenol (Ningbo) Limited Co. were investee companies in Mainland China through the Company's investee - FCFC Investment Corp. (Cayman). After share structure adjustment in 2008 and 2014, the parent company of the 4 investees became Formosa Chemicals & Fibre (Hong Kong) Co., Ltd. Formosa Chemicals & Fibre (Hong Kong) Co., Ltd. is a wholly-owned subsidiary through reinvestment of FCFC Investment Corp. (Cayman).

• The Company reorganised its investment structure through a merger of 4 investees in Mainland China, namely, Formosa Chemicals Industries (Ningbo) Co., Ltd., Formosa ABS Plastics (Ningbo) Co., Ltd., Formosa PS (Ningbo) Co., Ltd. and Formosa Phenol (Ningbo) Limited Co. After the effective date of January 2, 2018, Formosa Chemicals Industries (Ningbo) Co., Ltd. was the surviving entity. The proposal had been resolved by Board of Directors on November 4, 2016.

Formosa Synthetic Rubber (Ningbo) Co., Ltd. is an investee company in Mainland China through the investee - Formosa Synthetic Rubber (Hong Kong) Co., Ltd..

Formosa Biomedical Trading (Shanghai) Co., Ltd. is an investee company in Mainland China through the investee - Formosa Biomedical (Samoa) Co., Ltd..

• Formosa Taffeta (Changshu) Co., Ltd. is an investee company in Mainland China through the subsidiary - Formosa Taffeta (Hong Kong) Co., Ltd..

• The Company is the surviving company after the consolidation of Changshu Yu Yuan Development.Co.,Ltd. and Changshu Fushun Enterprise Management Co.,Ltd. It’s paid-in capital is RMB$13,592,920. Note 2: Investment income recognised in current period is based on the financial reports audited by CPAs of the Taiwan parent company.

• Note 3: The Company's paid-in capital, accumulative remittance from Taiwan as of January 1, 2021 and December 31, 2021 all amount to US$46,400,000. (The remittance of US$46,388,800 and the capitalised value of machinery and equipment of US$11,200)

Note 4: The Company's paid-in capital, accumulative remittance from Taiwan as of January 1, 2021 and December 31, 2021 all amount to US$42,000,000. In order to effectively utilise the residential land of the Company, Formosa Chemicals & Fibre Co. split the residential land and established Changshu Fushun Enterprise Management Co., Ltd. by capitalizing the residential land in the first quarter, 2015. Formosa Chemicals & Fibre Co. reduced the capital of Formosa Taffeta (Changshu) Co., Ltd. by US$900,000, so the Company's paid-in capital amounts to $41,100,000.

• Note 5: The Company is the surviving company after the merger with Changshu Yu Yuan Development.Co., Ltd. in the third quarter, 2015. The paid-in capital of the Company is RMB$13,592,920.

Accumulated Investment Ceiling on amount of amount approved investments in remittance from by the Investment Mainland China Taiwan to Commission of imposed by the Mainland China the Ministry of Investment as of December Economic Affairs Commission of Company name 31, 2021 (MOEA) MOEA The Company $ 38,174,279 $ 39,420,315 Note

Note: Corporations that are qualified with operations headquarters certification issued by the Industrial Development Bureau, Ministry of Economic Affairs, R.O.C.

Table 10, Page 2

Table 11

Formosa Chemicals and Fibre Corporation and subsidiaries

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

For the year ended December 31, 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
	Amount	%	Amount	%	Balance at December 31, 2021	%	Balance at December 31, 2021	Purpose	Maximum balance during the year ended December 31,2021	Balance at December31,2021	Interest rate	Interest during the year ended December 31,2021
Formosa Taffeta (Zhongshan) Co., Ltd. Formosa Taffeta (Changshu) Co., Ltd.	$ 12,151 22,958	0.05 0.09	$ - -	- -	$ 5,982 2,415	0.26 0.11	$ 913,440 1,522,400	For short-term loans from financial institutions For short-term loans from financial institutions	$ - -	- $ -	- -	- $ -	- -

Table 11, Page 1

Formosa Chemicals and Fibre Corporation and subsidiaries Information on Major Shareholders

For the year ended December 31, 2021

Table 12

Expressed in thousands of NTD (Except as otherwise indicated)

Name of Major Shareholder	Shares	Shares
	Number of Shares	Ownership (%)
Chang Gung Medical Foundation Qin's International Investment Holdings Ltd.	1,089,142,009 371,938,814	18.58% 6.35%

Table 12, Page 1