Fiti — Audit Report / Information 2023

Dec 29, 2023

FOXSEMICON INTERGRATED TECHNOLOGY INC. AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND

AUDIT REPORT OF INDEPENDENT ACCOUNTANTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (STOCK CODE: 3413)

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

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FOXSEMICON INTERGRATED TECHNOLOGY INC.

FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 CONSOLIDATED FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS’ REPORT TABLE OF CONTENTS

Contents

Page

1. Cover Page 2. Table of Contents 3. Independent Auditors’ Report 4. Consolidated Balance Sheets 5. Consolidated Statements of Comprehensive Income 6. Consolidated Statements of Changes in Equity 7. Consolidated Statements of Cash Flows 8. Notes to the Consolidated Financial Statements (1) History and Organization (2) The Date of Authorization for Issuance of the Financial Statements and Procedures for Authorization (3) Application of New Standards, Amendments and Interpretations (4) Summary of Material Accounting Policies (5) Critical Accounting Judgements, Estimates and Key Sources of Assumption Uncertainty (6) Details of Significant Accounts

1 2 ~ 3 4 ~ 10 11 ~ 12 13 ~ 14 15 16 ~ 17 18 ~ 71 18 18 18 ~ 19 19 ~ 33 33 ~ 34 35 ~ 58

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Contents Page

(7)	Related Party Transactions	59 ~ 60
(8)	Pledged Assets	60
(9)	Significant Contingent Liabilities and Unrecognized Contract	61
	Commitments
(10)	Significant Disaster Loss	61
(11)	Significant Events after the Balance Sheet Date	61
(12)	Others	61 ~ 70
(13)	Supplementary Disclosures	70 ~ 71
(14)	Operating Segment Information	71

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INDEPENDENT AUDITORS’ REPORT

To the Board of Directors and Shareholders of Foxsemicon Integrated Technology Inc.

Opinion

We have audited the accompanying consolidated balance sheets of Foxsemicon Integrated Technology Inc. and subsidiaries (the “Group”) as at December 31, 2023 and 2022, 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, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2023 and 2022, 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 that came into effect as endorsed by the Financial Supervisory Commission.

Basis for opinion

We conducted our audits in accordance with the Regulations Governing Financial Statement Audit and Assestation Engagements of Certified Public Accountants and Standards on Auditing of the Republic of China. Our responsibilities under those standards are further described in the Auditor’s 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.

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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 2023 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.

Key audit matters for the Group’s 2023 consolidated financial statements are stated as follows:

Sales revenue cut-off

Description

Please refer to Note 4(31) for accounting policy on revenue recognition, Note 5(1) for critical judgement on revenue recognition, and Note 6(19) for details of revenue. For the year ended December 31, 2023, the balance of revenue amounted to NT$13,051,357 thousand.

Among the Group’s transaction types, warehouse sales revenue is recognized when customers accept the goods (when control of the product is transferred). Since all of the Group’s warehouses are located in the United States or Singapore, the controls of those are more difficult than the direct shipment. Therefore, sale revenue is recognized based on the report provided by warehouse custodians. The process of revenue recognition contains numerous manual procedures, and it would potentially result in inaccurate timing of revenue recognition and the discrepancy between physical inventory quantities in the warehouses and quantities in accounting records. Since there are numerous daily revenue from warehouses and the transaction amounts prior to and after the balance sheet date are significant to the financial statements, cut-off of sales revenue from distribution warehouse has been identified as a key audit matter.

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How our audit addressed the matter

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

• Assessed and tested the appropriateness of internal controls over the cut-off of hub sales revenue for a specific period prior to and after the balance sheet date, and performing cut-off testing, including agreeing to respective supporting documents provided by hub custodians, and validated the proper timing of recognizing movements of inventories and respective transfer of cost of goods sold.

• Confirmed the inventory quantities with warehouse custodians and agreed the results to accounting records.

Evaluation of inventories

Description

Please refer to Note 4(14) for description of accounting policy on inventory valuation, Note 5(2) for accounting estimates and assumption uncertainty in relation to inventory valuation, and Note 6(5) for details of inventories. As of December 31, 2023, the balances of inventories and allowance for valuation loss on inventories amounted to NT$2,708,768 thousand and NT$88,639 thousand respectively.

The Group is primarily engaged in manufacture and sales of semiconductors and automation equipment and components. As technology changes rapidly, the life cycles of electronic products are short, prices are easily influenced by fluctuation in market price, there is higher risk of incurring inventory valuation losses or obsolescence. The Group measures inventories sold at the lower of cost and net realizable value. For inventories that are over a certain age and individually identified obsolete or ruined inventory, losses are recognized at net realizable value.

The Group’s allowance for inventory valuation losses mainly arises from individually identified obsolete or ruined inventory, and since the value of inventories is significant, inventory types are various, the individual identification of inventory usually involves human judgement and the valuation contains uncertainty. Thus, we identified the valuation of allowance for valuation loss on inventories as one of key audit matters.

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How our audit addressed the matter

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

• Ascertained whether the policies and procedures on allowance for inventory valuation losses were reasonable and consistently applied in all the periods.

• Verified the appropriateness of the system logic in calculating the ageing of inventories, and confirmed the information in the reports is consistent with the relevant policies.

• Assessed the reasonableness of separately identified obsolete and damaged inventories and verified against information obtained during the stock count.

• For net realizable value of inventories over normal age and those individually identified obsolete and damaged inventory, we discussed with the management, obtained supporting documents and reviewed the calculation of inventory loss.

Other matter – Parent company only financial reports

We have audited and expressed an unqualified opinion on the parent company only financial statements of Foxsemicon Integrated Technology Inc. as at and for the years ended December 31, 2023 and 2022.

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 that came into effect 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.

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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 the 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 auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Standards on Auditing of 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 Standards on Auditing of the Republic of China, we exercise professional judgment and 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.

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1. 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.

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

3. 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.

4. 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.

5. 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.

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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.

Hsu, Sheng-Chung[Wu, Jen-Chieh ] For and on Behalf of PricewaterhouseCoopers, Taiwan Feburary 29, 2024

------------------------------------------------------------------------------------------------------------------------------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.

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FOXSEMICON INTERGRATED TECHNOLOGY INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2023 AND 2022

(Expressed in thousands of New Taiwan dollars)

Assets	Notes 6(1) 6(1) 6(4) and 7 7 6(5) 6(2) 6(3) 6(6) and 8 6(7) and 7 6(8) 6(24) 6(1) and 8	December 31, 2023 AMOUNT % $ 6,956,133 36 3,627,151 19 782,640 4 121,882 1 2,620,129 13 216,603 1 14,324,538 74 27,550 - 292,437 1 96,705 - 3,780,898 20 318,207 2 28,913 - 9,516 - 490,959 3 5,045,185 26 $ 19,369,723 100	December 31, 2022	December 31, 2022
		AMOUNT $ 6,956,133 3,627,151 782,640 121,882 2,620,129 216,603 14,324,538 27,550 292,437 96,705 3,780,898 318,207 28,913 9,516 490,959 5,045,185 $ 19,369,723	AMOUNT $ 8,543,988 1,268,520 977,844 10,624 3,807,053 198,677 14,806,706 232,097 194,076 76,383 3,540,849 294,244 35,874 9,956 500,007 4,883,486 $ 19,690,192	%
Current assets 1100 Cash and cash equivalents 1136 Current financial assets at amortized cost 1170 Accounts receivable 1200 Other receivables 130X Inventory 1410 Prepayments 11XX Total current assets Non-current assets 1510 Non-current financial assets at fair value through profit or loss 1517 Non-current financial assets at fair value through other comprehensive income 1550 Investments accounted for using equity method 1600 Property, plant and equipment 1755 Right-of-use assets 1760 Investment property 1840 Deferred income tax assets 1900 Other non-current assets 15XX Total non-current assets 1XXX Total assets				43 7 5 - 19 1
				75
				1 1 - 18 2 - - 3
				25
				100

(Continued)

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FOXSEMICON INTERGRATED TECHNOLOGY INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2023 AND 2022

(Expressed in thousands of New Taiwan dollars)

Liabilities and Equity	Notes 6(9) 6(2) 6(10) 7 6(13)(14) 6(11) 6(13) 6(14) 6(24) 7 6(11) 6(15) 6(17) 6(18) 9 11	December 31, 2023 AMOUNT % $ 35,000 - - - 339,282 2 941,407 5 1,464,158 8 251,149 1 47,235 - 64,715 - 393,363 2 3,536,309 18 1,865,038 10 1,571,780 8 47,413 - 285,457 2 461,486 2 4,231,174 22 7,767,483 40 971,861 5 246 - 2,286 - 4,051,311 21 943,255 5 6,336 - 5,586,669 29 40,276 - 11,602,240 60 - - 11,602,240 60 $ 19,369,723 100	December 31, 2022	December 31, 2022
		AMOUNT $ 35,000 - 339,282 941,407 1,464,158 251,149 47,235 64,715 393,363 3,536,309 1,865,038 1,571,780 47,413 285,457 461,486 4,231,174 7,767,483 971,861 246 2,286 4,051,311 943,255 6,336 5,586,669 40,276 11,602,240 - 11,602,240 $ 19,369,723	AMOUNT $ 417,640 1,336 15,935 1,438,868 1,891,429 425,627 32,782 1,879,870 596,891 6,700,378 - 1,506,039 38,837 269,089 344,692 2,158,657 8,859,035 967,921 - 2,588 3,939,329 713,397 6,336 5,166,593 34,993 10,831,157 - 10,831,157 $ 19,690,192	%
Current liabilities 2100 Short-term loans 2120 Current financial liabilities at fair value through profit or loss 2130 Current contract liabilities 2170 Accounts payable 2200 Other payables 2230 Current tax liabilities 2280 Current lease liabilities 2320 Long-term liabilities, current portion 2399 Other current liabilities, others 21XX Total current liabilities Non-current liabilities 2530 Bonds payable 2540 Long-term loans 2570 Deferred income tax liabilities 2580 Non-current lease liabilities 2600 Other non-current liabilities 25XX Total non-current liabilities 2XXX Total Liabilities Equity Equity attributable to owners of parent Share capital 3110 Common stock 3130 Certificate of entitlement to new shares from convertible bond 3140 Advance receipts for share capital Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3320 Special reserve 3350 Unappropriated retained earnings Other equity interest 3400 Other equity interest 31XX Equity attributable to owners of the parent 36XX Non-controlling interests 3XXX Total equity Significant Contingent Liabilities and Unrecognized Contract Commitments Significant Events after the Balance Sheet Date 3X2X Total liabilities and equity				2 - - 7 10 2 - 10 3
				34
				- 8 - 1 2
				11
				45
				5 - - 20 4 - 26 -
				55
				-
				55
				100

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

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FOXSEMICON INTERGRATED TECHNOLOGY INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2023 AND 2022

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

Items

Year ended December 31 2023 2022 Notes AMOUNT % AMOUNT % 6(19) and 7 $ 13,051,357 100 $ 14,843,221 100 6(5) ( 9,636,790 ) ( 74) ( 10,399,687) ( 70) 3,414,567 26 4,443,534 30 6(22) ( 368,097 ) ( 3) ( 438,636) ( 3) ( 510,639 ) ( 4) ( 505,059) ( 3) ( 508,787 ) ( 4) ( 547,100) ( 4) 12(2) 2,989 - ( 1,679) - ( 1,384,534 ) ( 11) ( 1,492,474) ( 10) 2,030,033 15 2,951,060 20 239,953 2 87,779 - 6(20) 161,015 1 90,103 1 6(21) 131,791 1 ( 191,997) ( 1) ( 41,535 ) - ( 39,577) - ( 8,828 ) - ( 6,666) - 482,396 4 ( 60,358) - 2,512,429 19 2,890,702 20 6(24) ( 521,961 ) ( 4) ( 546,339) ( 4) $ 1,990,468 15 $ 2,344,363 16

4000 Operating revenue 5000 Operating costs 5900 Gross profit from operations Operating expenses 6100 Selling expenses 6200 Administrative expenses 6300 Research and development expenses 6450 Impairment gain (loss) 6000 Total operating expenses 6900 Net operating income Non-operating income and expenses 7100 Interest income 7010 Other income 7020 Other gains and losses 7050 Finance costs 7060 Share of loss of associates and joint ventures accounted for using equity method 7000 Total non-operating revenue and expenses 7900 Profit (loss) before income tax 7950 Income tax expense 8200 Profit for the period

(Continued)

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FOXSEMICON INTERGRATED TECHNOLOGY INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2023 AND 2022

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

Items

Year ended December 31 2023 2022 Notes AMOUNT % AMOUNT % 6(12) ($ 925 ) - $ 8,356 - 6(3) 78,482 1 ( 95,549) ( 1) 77,557 1 ( 87,193) ( 1) ( 71,890 ) ( 1) 73,589 1 ( 1,309 ) - 989 - ( 73,199 ) ( 1) 74,578 1 $ 4,358 - ($ 12,615) - $ 1,994,826 15 $ 2,331,748 16 $ 1,990,468 15 $ 2,319,754 16 - - 24,609 - $ 1,990,468 15 $ 2,344,363 16 $ 1,994,826 15 $ 2,307,139 16 - - 24,609 - $ 1,994,826 15 $ 2,331,748 16 6(25) $ 20.48 $ 24.64 $ 18.22 $ 21.96

Components of other comprehensive income that will not be reclassified to profit or loss 8311 Remeasurement of defined benefit plan 8316 Unrealized gain on valuation of financial assets at fair value through the comprehensive 8310 Components of other comprehensive income that will not be reclassified to profit or loss Components of other comprehensive income that will not be reclassified to profit or loss 8361 Financial statements translation difference of foreign operations 8370 Share of other comprehensive (loss) income of associates and joint ventures accounted for using equity method 8360 Other comprehensive loss that will be reclassified to profit or loss 8300 Other comprehensive income for the year 8500 Total comprehensive income for the year Profit attributable to: 8610 Owners of the parent 8620 Non controlling interest Total comprehensive income attributable to: 8710 Owners of the parent 8720 Non controlling interest Earnings per share (in dollars) 9750 Basic earnings per share 9850 Diluted earnings per share

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

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FOXSEMICON INTERGRATED TECHNOLOGY INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY YEARS ENDED DECEMBER 31, 2023 AND 2022

(Expressed in thousands of New Taiwan dollars)

2022 Balance at January 1, 2022 Profit for the year Other comprehensive income (loss) for the year Total comprehensive income Appropriations of 2021 earnings Legal reserve Cash dividends Inssuance of shares Conversion of convertible bonds Executive employee stock options Change in non controlling interest Share-based payment Balance at December 31, 2022 2023 Balance at January 1, 2023 Profit for the year Other comprehensive income (loss) for the year Total comprehensive income Appropriations of 2022 earnings Legal reserve Cash dividends Conversion of convertible bonds Executive employee stock options Share-based payment Change in equity of associates and joint ventures accounted for using equity method Balance at December 31, 2023	Notes				E	quityattributable to o	wners of theparent				Total	Non-controlling interests		Total equity
			Capital	Advance receipts for share capital	Total capital surplus, additional paid-in capital		Retained Earnings	Unappropriated retained earnings	Other equityinterest Financial statements translation differences of foreign operations Total Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income
		Common stock	Certificate of entitlement to new shares from convertible bond $ - - - - - - - - - - - $ - $ - - - - - - 246 - - - $ 246			Legal reserve	Special reserve		Financial statements translation differences of foreign operations
	6(18) 6(17) 6(17) 6(16)(17) 6(18) 6(17) 6(17) 6(16)(17) 6(17)	$ 878,008 - - - - - 81,172 3,769 4,972 - - $ 967,921 $ 967,921 - - - - - 6 3,934 - - $ 971,861		$ 1,056 - - - - - - - 1,532 - - $ 2,588 $ 2,588 - - - - - - ( 302) - - $ 2,286	$ 2,093,841 - - - - - 1,625,238 64,847 86,947 696 67,760 $ 3,939,329 $ 3,939,329 - - - - - 3,853 39,814 68,086 229 $ 4,051,311	$ 558,372 - - - 155,025 - - - - - - $ 713,397 $ 713,397 - - - 229,858 - - - - - $ 943,255	$ 6,336 - - - - - - - - - - $ 6,336 $ 6,336 - - - - - - - - - $ 6,336	$ 3,863,061 2,319,754 8,356 2,328,110 ( 155,025) ( 840,021) - - - ( 29,532) - $ 5,166,593 $ 5,166,593 1,990,468 ( 925) 1,989,543 ( 229,858) ( 1,339,609) - - - - $ 5,586,669	($ 59,831) - 74,578 74,578 - - - - - - - $ 14,747 $ 14,747 - ( 73,199) ( 73,199) - - - - - - ($ 58,452)	$ 115,795 - ( 95,549) ( 95,549) - - - - - - - $ 20,246 $ 20,246 - 78,482 78,482 - - - - - - $ 98,728	$ 7,456,638 2,319,754 ( 12,615) 2,307,139 - ( 840,021) 1,706,410 68,616 93,451 ( 28,836) 67,760 $ 10,831,157 $ 10,831,157 1,990,468 4,358 1,994,826 - ( 1,339,609) 4,105 43,446 68,086 229 $ 11,602,240	$ 67,251 24,609 - 24,609 - - - - - ( 92,612) 752 $ - $ - - - - - - - - - - $ -		$ 7,523,889 2,344,363 ( 12,615) 2,331,748 - ( 840,021) 1,706,410 68,616 93,451 ( 121,448) 68,512 $ 10,831,157 $ 10,831,157 1,990,468 4,358 1,994,826 - ( 1,339,609) 4,105 43,446 68,086 229 $ 11,602,240

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

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FOXSEMICON INTERGRATED TECHNOLOGY INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2023 AND 2022

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax Adjustments Adjustments to reconcile profit (loss) Depreciation expense (including investment property and right-of-use assets) Amortization expense Gain on reversal of payable Share-based payments Additional provision recognized Share of loss of associates and joint ventures accounted for using equity method Expected credit (gains) losses recognized (Gain) Loss on financial assets at fair value through profit or less Loss on disposal of property, plant and equipment Interest income Interest expense Dividend income Realized profit of deferred income Changes in operating assets and liabilities Changes in operating assets Financial assets and liabilities at fair value through profit or loss, mandatorily Accounts receivable net Accounts receivable related parties Other receivable Inventories Prepayment Changes in operating liabilities Accounts payable Other payable Contract liabilities Other current liabilities Defined benefit plans asset/Accrued pension liabilities Cash inflow generated from operations Income taxes paid Net cash flows from operating activities

Year ended December 31 Notes 2023 2022 $ 2,512,429 $ 2,890,702 6(8)(22) 399,683 301,206 6(22) 10,199 12,478 ( 3,880 ) ( 2,617 ) 6(16) 68,086 68,512 6(11) 38,784 28,073 8,828 6,666 12(2) ( 2,989 ) 1,679 6(21) ( 175,518 ) 69,611 6(21) 3,109 1,680 ( 239,953 ) ( 87,779 ) 41,535 39,577 ( 4,023 ) ( 8,499 ) ( 62,927 ) ( 2,894 ) 411 ( 351 ) 172,110 708,115 - 181,946 ( 2,437 ) ( 3,559 ) 1,150,890 ( 912,892 ) ( 20,889 ) ( 39,314 ) ( 486,783 ) ( 775,061 ) ( 412,015 ) 846,711 323,347 ( 29,064 ) ( 21,198 ) ( 9,236 ) 853 ( 837 ) 3,297,652 3,284,853 ( 656,353 ) ( 426,266 ) 2,641,299 2,858,587

(Continued)

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FOXSEMICON INTERGRATED TECHNOLOGY INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2023 AND 2022

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM INVESTING ACTIVITIES Financial assets at amortized cost Acquisition of financial assets at fair value through profit or loss Disposal of financial assets at fair value through profit or loss Acquisition of financial assets at fair value through other comprehensive income Acquisition of Investments accounted for using equity method Acquisition of property, plant and equipment Dividends received Proceeds from disposal of property, plant and equipment Interest received Increase in other non-current assets Net cash flows used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Interest paid Inssuance of common stock Increase in short-term loans Decrease in short-term loans Payments of lease liabilities Acquisition of supplemental loan Repayments of supplemental loan Proceeds from long-term debt Repayments of long-term debt Payment of cash dividends Change for non controlling interest Executive employee stock options Net cash flows (used in) from financing activities Effect of changes in foreign currency exchange rates on cash Net (decrease) increase in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year

Year ended December 31 Notes 2023 2022 ($ 2,358,631 ) $ 292,120 12(3) ( 14,404 ) ( 6,843 ) 256,545 - - ( 49,170 ) ( 30,230 ) ( 82,060 ) 6(27) ( 544,808 ) ( 2,114,229 ) 4,023 8,499 375 163 239,953 87,779 ( 73,935 ) ( 529 ) ( 2,521,112 ) ( 1,864,270 ) ( 21,233 ) ( 19,464 ) 6(15) - 1,706,410 6(28) 923,540 193,341 6(28) ( 1,305,172 ) - 6(28) ( 46,816 ) ( 28,961 ) - 419,016 ( 44,150 ) ( 71,359 ) 6(28) 141,208 1,112,146 ( 30,932 ) - 6(18) ( 1,339,609 ) ( 840,021 ) 6(27) - ( 121,448 ) 43,446 93,451 ( 1,679,718 ) 2,443,111 ( 28,324 ) 38,583 ( 1,587,855 ) 3,476,011 8,543,988 5,067,977 $ 6,956,133 $ 8,543,988

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

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FOXSEMICON INTERGRATED TECHNOLOGY INC. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

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

1. History and Organization

• (1) Foxsemicon Integrated Technology Inc. (the “Company”) was incorporated as company limited by shares under the provisions of the Company Act of the Republic of China (R.O.C.) on April 26, 2001, and in accordance with the “Act for Establishment and Administration of Science Parks”, the investment in the science park was approved in April 2003. The company was listed on the Taiwan Stock Exchange Corporation (the “TSEC”) in July 28, 2015.

• (2) The Company and its subsidiaries (collectively referred herein as the “Group”) are primarily engaged in research, development, design, manufacturing and sales of subsystems and system integration of semiconductor equipment, subsystems and system integration of TFT-LCD, nano equipment, LED lighting, LED display product and other application product, photoelectric, communication wafer materials and medical devices.

• The Date of Authorization for Issuance of the Financial Statements and Procedures for Authorization

• These consolidated financial statements were authorized for issuance by the Board of Directors on February 29, 2024.

• Application of New Standards, Amendments and Interpretations

• (1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS[®] ”) Accounting Standards that came into effect as endorsed by the Financial Supervisory Commission (“FSC”)

New standards, interpretations and amendments endorsed by FSC and became effective from 2023 are as follows:

	Effective date by
	International Accounting
New Standards,Interpretations andAmendments	Standards Board
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’
Amendments to IAS 12, ‘International tax reform - pillar two model rules’	May 23, 2023

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 IFRS Accounting Standards as endorsed by the FSC but

not yet adopted by the Group

New standards, interpretations and amendments endorsed by FSC and will become effective from 2024 are as follows:

	Effective date by
	International Accounting
New Standards,Interpretations andAmendments	Standards Board
Amendments to IFRS 16, ‘Lease liability in a sale and leaseback’	January 1, 2024
Amendments to IAS 1, ‘Classification of liabilities as current or non-	January 1, 2024
current’
Amendments to IAS 1, ‘Non-current Liabilities with Covenants’	January 1, 2024
Amendments to IAS 7 and IFRS 7, ‘Supplier finance arrangements’	January 1, 2024

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) IFRS Accounting Standards issued by IASB but not yet endorsed by the FSC

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

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Effective date by
International Accounting
New Standards, Interpretations and Amendments Standards Board
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New Standards, Interpretations and Amendments	Effective date by International Accounting Standards Board
Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets	To be determined by
between an investor and its associate or joint venture’	International Accounting
	Standards Board
IFRS 17, ‘Insurance contracts’	January 1, 2023
Amendments to IFRS 17, ‘Insurance contracts’	January 1, 2023
Amendment to IFRS 17, ‘Initial application of IFRS 17 and IFRS 9 –	January 1, 2023
comparative information’
Amendments to IAS 21, ‘Lack of exchangeability’	January 1, 2025

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

4. Summary of Material 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 are the first consolidated financial statements prepared by the Group 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 that came into effect 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 and financial asset at fair value through profit or loss.

• (b) Defined benefit liabilities recognized 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 Unrealized gains or losses on transactions between companies within the Group are eliminated. Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency with the policies adopted by the Group.

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

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

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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 recognized in profit or loss. All amounts previously recognized in other comprehensive income in relation to the subsidiary are reclassified to profit or loss on the same basis as would be required if the related assets or liabilities were disposed of. That is, when the Group loses control of a subsidiary, all gains or losses previously recognized in other comprehensive income in relation to the subsidiary should be reclassified from equity to profit or loss, if such gains or losses would be reclassified to profit or loss when the related assets or liabilities are disposed of.

• B. Subsidiaries included in the consolidated financial statements:

B. Subsidiaries included in the consolidated financial statements:
Name of Name of Main business investor subsidiary activities Foxsemicon Integrated Technology Inc. FOXSEMICON INTEGRATED TECHNOLOGY INC. (SAMOA) Holding company of overseas reinvestment business Foxsemicon Integrated Technology Inc. FOXSEMICON LLC. (LLC) A company engaged in import and export freight forwarding business Foxsemicon Integrated Technology Inc. FOX AUTOMATION TECHNOLOGY INC. Manufacture of machinery, equipment and electronic components Foxsemicon Integrated Technology Inc. Frontier Integrated Global Solutions, Inc. Manufacture of machinery, equipment and electronic components Foxsemicon Integrated Technology Inc. Kainova Technology Inc. Manufacture of machinery, equipment and electronic components Foxsemicon Integrated Technology Inc. FOXSEMICON INNOVATIONS HOLDING INC. Holding company of overseas reinvestment business Foxsemicon Integrated Technology Inc. UNIEQ TECHNOLOGY PTE.LTD Holding company of overseas reinvestment business Foxsemicon Integrated Technology Inc. UniEQ Integrated Technology CO., Ltd. Manufacture of machinery, equipment and electronic components FOXSEMICON INNOVATIONS HOLDING INC. FOXSEMICON TECHNOLOGY, LLC Research and development and manufacture of machinery, equipment and		December December 31,2023 31,2022 Remark 100 100 100 100 100 100 (2) 100 100 100 100 100 100 100 - (3) 100 - (4) 100 100 Ownership(%)
		December 31,2023 100 100 100 100 100 100 100 100 100
			(2) (3) (4)

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Ownership(%)
Name of Name of Main business December December
investor subsidiary activities 31, 2023 31, 2022 Remark
----- End of picture text -----

Name of investor	Name of subsidiary	Main business activities	December 31,2023	December 31, 2022	Remark
Kainova Technology	Kaivaco Technology	Manufacture of machinery,	100	100	(5)
Inc.	Nanjing Inc.	equipment and electronic
		components
FOXSEMICON	MINDTECH	Holding company of overseas	100	100
INTEGRATED	CORPPORATION	reinvestment business
TECHNOLOGY	(MINDTECH)
INC.
FOXSEMICON	SUCCESS PRAISE	A location for overseas	100	100
INTEGRATED	CORPORATION	trading for some companies
TECHNOLOGY	(SUCCESS PRAISE)	in Mainland China
INC.
FOXSEMICON	SMART ADVANCE	A location for overseas	100	100	(1)
INTEGRATED	CORPORATION	trading for some companies
TECHNOLOGY	(SMART ADVANCE)	in Mainland China
INC.
FOXSEMICON	EVER DYNAMIC	A location for overseas	100	100	(1)
INTEGRATED	CORP	trading for some companies
TECHNOLOGY		in Mainland China
INC.
FOXSEMICON	LOYAL NEWS	A location for overseas	100	100	(1)
INTEGRATED	INTERNATIONAL	trading for some companies
TECHNOLOGY	LIMITED (LOYAL	in Mainland China
INC.	NEWS)
MINDTECH	Foxsemicon Integrated	Production and sales of	100	100	(5)
CORPORATION	Technology (Shanghai)	electronic special equipment,
	Inc.	test instruments, and
		industrial molds
Foxsemicon	Foxsemicon Integrated	Develop and produce new	100	100
Integrated	Technology (Kunshan)	alloy materials and electronic
Technology	Inc.	special equipment for
(Shanghai) Inc.		production and sales
Foxsemicon	Shanghai EnvoFox	Operation of environmental	100	100
Integrated	Integrated Technology	protection automatic control
Technology	Limit Inc.	system and environmental
(Shanghai) Inc.		engineering production and
		sales business

• (1) The Company’s shareholding ratio in EVER DYNAMIC CORP, LOYAL NEWS INTERNATIONAL LIMITED and SMART ADVANCE CORPORATION was 100%. However, all the companies mentioned above ceased operation in 2014.

• (2) For the year ended December 31, 2022, the company purchased the equity of the subsidiary FOX AUTOMATION TECHNOLOGY INC. from non-controlling interests, and the shareholding ratio was increased to 99.88% and 100% in September 30,2022 and December 31,2022, respectively. Please refer to Note 6(26).

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  - (3) The company invested in the establishment of UNIEQ TECHNOLOGY PTE. LTD. in September 2023, and it was included in the consolidated financial statement preparation entity from the investment date.

  - (4) The company invested in the establishment of UniEQ Integrated Technology CO., Ltd. in November 2023, and it was included in the consolidated financial statement preparation entity from the investment date.

  - (5) The disclosure of the subsidiary mentioned above reinvesting in Mainland China, please refer to Note 13.

• 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: None.

• (4) Foreign currency translation

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

• A. Foreign currency transactions and balances

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

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

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

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

• B. Translation of foreign operations

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

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• i. Assets and liabilities presented in each balance sheet are converted at the exchange rates prevailing at the date of that balance sheet;

• ii. Income and expense presented in each comprehensive income statement are translated at average exchange rates of that period; and

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

• (b) When the foreign operation partially disposed of or sold is an associate, exchange differences that were recorded in other comprehensive income are proportionately reclassified to profit or loss as part of the gain or loss on sale. In addition, even when the Group retains partial interest in the former foreign associate or jointly controlled entities after losing significant influence over the former foreign associate, or losing joint control of the former jointly controlled entities, such transactions should be accounted for as disposal of all interest in these foreign operations.

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

(5) Classification of current and non-current items

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

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

• (b) Assets held mainly for trading purposes;

• (c) Assets that are expected to be realized within 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.

• 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) Assets held mainly for trading purposes;

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

• (d) Liabilities for which the repayment date cannot be deferred unconditionally for at least 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

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meet the definition above and are held for the purpose of meeting short-term cash commitments in operations are classified as cash equivalents.

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

• A. Financial assets at fair value through profit or loss are financial assets that are not measured at amortized cost or fair value through other comprehensive income.

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

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

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

• A. Financial assets at fair value through other comprehensive income comprise equity securities which are not held for trading, and for which the Group has made an irrevocable election at initial recognition to recognize 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 recognized and derecognized using trade date accounting.

• C. At initial recognition, the Group measures the financial assets at fair value plus transaction costs. The Group subsequently measures the financial assets at fair value. The changes in fair value were recognized 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 recognized 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.

(9) Financial assets at amortized cost

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

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

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

• B. On a regular way purchase or sale basis, financial assets at amortized cost are recognized and derecognized 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 recognized in profit or loss when the asset is derecognized 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.

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(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 Group initially measures accounts and notes receivable at fair value and subsequently recognizes the amortized interest income over the period of circulation using the effective interest method and the impairment loss. A gain or loss is recognized in profit or loss.

(11) Impairment of financial assets

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

(12) Derecognition of financial assets

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

－ (13) Leasing arrangements (lessor) operating leases

Lease income from an operating lease (net of any incentives given to the lessee) is recognized in profit or loss on a straight-line basis over the lease term.

• (14) Inventories

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

(15) 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 recognized at cost, including goodwill recognized at the time of acquisition, and less any accumulated impairment loss arising from subsequent evaluations.

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• B. The Group’s share of its associates’ post-acquisition profits or losses is recognized in profit or loss, and its share of post-acquisition movements in other comprehensive income is recognized in other comprehensive income. When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognize further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the associate.

• C. When changes in an associate’s equity 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 recognizes the Group’s share of change in equity of the associate in ‘capital surplus’ in proportion to its ownership.

• D. Unrealized gains on transactions between the Group and its associates are eliminated to the extent of the Group’s interest in the associates. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been adjusted where necessary to ensure consistency with the policies adopted by the Group.

• E. In the case that an associate issues new shares and the Group does not subscribe or acquire new shares proportionately, which results in a change in the Group’s ownership percentage of the associate but maintains significant influence on the associate, then ‘capital surplus’ and ‘investments accounted for under the equity method’ shall be adjusted for the increase or decrease of its share of equity interest. If the above condition causes a decrease in the Company’s ownership percentage of the associate, in addition to the above adjustment, the amounts previously recognized in other comprehensive income in relation to the associate are reclassified to profit or loss proportionately on the same basis as would be required if the relevant assets or liabilities were disposed of.

• F. Upon loss of significant influence over an associate, the Group remeasures any investment retained in the former associate at its fair value. Any difference between fair value and carrying amount is recognized in profit or loss.

• G. When the Group disposes its investment in an associate and loses significant influence over this associate, the amounts previously recognized in other comprehensive income in relation to the associate, are reclassified to profit or loss. If it retains significant influence over this associate, the amounts previously recognized in other comprehensive income in relation to the associate are reclassified to profit or loss proportionately in accordance with the aforementioned approach.

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

(16) Property, plant and equipment

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

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

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

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

Buildings and structures: 25~35 year(s)

Machinery and equipment: 5~10 year(s)

Other equipment: 3~8 year(s)

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

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

• B. Lease liabilities include the net present value of the remaining lease payments at the commencement date, discounted using the incremental loan interest rate. Lease payments are comprised of the Fixed payments. The Group subsequently measures the lease liability at amortized cost using the interest method and recognizes interest expense over the lease term. The lease liability is remeasured and the amount of remeasurement is recognized as an adjustment to the right-of-use asset when there are changes in the lease term or lease payments and such changes do not arise from contract modifications.

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

(18) Investment property

An investment property is stated initially at its cost and measured subsequently using the cost model. Except for land, investment property is depreciated on a straight-line basis over its estimated useful life of 35 years.

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(19) Impairment of non-financial assets

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

(20) Loans

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

(21) Notes and accounts payable

Accounts payable are liabilities for purchases of raw materials, goods or services and notes payable are those resulting from operating and non-operating activities. The Group initially measures notes and accounts payable at fair value and subsequently measured at amortized cost using the effective interest method. However, short-term accounts payable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

(22) 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 categorized 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 recognized in profit or loss. The Group subsequently measures these financial liabilities at fair value with any gain or loss recognized in profit or loss.

(23) Convertible bonds payable

Convertible bonds issued by the Group contain conversion options (that is, the bondholders have the right to convert the bonds into the Group’ s common shares by exchanging a fixed amount of cash for a fixed number of common shares). The Group classifies the bonds payable upon issuance as a financial liability or an equity instrument in accordance with the contract terms. They are accounted for as follows:

• A. The embedded call options and put options are recognized initially at net fair value as ‘financial assets or financial liabilities at fair value through profit or loss’. They are subsequently remeasured and stated at fair value on each balance sheet date; the gain or loss is recognized as ‘gain or loss on valuation of financial assets or financial liabilities at fair value through profit or loss’.

• B. The host contracts of bonds is initially recognized at fair value. Any difference between the initial recognition and the redemption value is accounted for as the premium or discount on bonds

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payable and subsequently is amortized in profit or loss as an adjustment to ‘finance costs’ over the period of circulation using the effective interest method.

• C. The embedded conversion options which meet the definition of an equity instrument are initially recognized in ‘capital surplus—share options’ at the residual amount of total issue price less bonds payable as stated above. Conversion options are not subsequently remeasured.

• D. Any transaction costs directly attributable to the issuance are allocated to each liability or equity component in proportion to the initial carrying amount of each abovementioned item.

• E. When bondholders exercise conversion options, the liability component of the bonds shall be remeasured on the conversion date. The book value of common shares issued due to the conversion shall be based on the adjusted book value of the abovementioned liability component plus the book value of capital surplus - share options.

(24) Derecognition of financial liabilities

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

• (25) Offsetting financial instruments

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

• (26) Provisions

Provisions (including warranties) are recognized when the Group has a present legal or constructive obligation as a result of past events, and it is probable that an outflow of economic resources will be required to settle the obligation and the amount of the obligation can be reliably estimated. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation on the balance sheet date, which is discounted using a pre-tax discount rate that reflects the current market assessments of the time value of money and the risks specific to the obligation. When discounting is used, the increase in the provision due to passage of time is recognized as interest expense. Provisions are not recognized for future operating losses.

(27) Employee benefits

• A. Short-term employee benefits

Short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid and are recognized as expenses in the period in which the employees render service.

• B. Pension

(a)Defined contribution plan

For defined contribution plans, the Company has no legal or constructive obligation to make additional contributions after a fixed amount is contributed to a public or privately managed and independent pension fund. The contributions are recognized as pension expenses when they are due on an accrual basis. Prepaid contributions are recognized as an asset to the extent of a cash refund or a reduction in the future payments.

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(b)Defined benefit plan

     - i.Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employees will receive on retirement for their services with the Group in current period or prior periods. The liability recognized in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The net defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The rate used to discount is determined by using interest rates of 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 recognized in other comprehensive income in the period in which they arise and are recorded as retained earnings.

• C. Employees’ compensation and directors’ remuneration

  • Employees’ compensation and directors’ remuneration are recognized 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. If employee compensation is paid by shares, the Group calculates the number of shares based on the closing price at the previous day of the board meeting resolution.

• (28) Share-based payment - employees’ bonus and compensation

For the equity-settled share-based payment arrangements, the employee services received are measured at the fair value of the equity instruments granted at the grant date, and are recognized as compensation cost over the vesting period, with a corresponding adjustment to equity. The fair value of the equity instruments granted shall reflect the impact of market vesting conditions and nonvesting conditions. Compensation cost is subject to adjustment based on the service conditions that are expected to be satisfied and the estimates of the number of equity instruments that are expected to vest under the non-market vesting conditions at each balance sheet date. Ultimately, the amount of compensation cost recognized is based on the number of equity instruments that eventually vest.

• (29) Income tax

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

• B. The current income tax expense is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns

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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.

• C. Deferred tax is recognized, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated balance sheet. However, the deferred tax is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss and does not give rise to equal taxable and deductible temporary differences. Deferred 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 tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realized or the deferred tax liability is settled.

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

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

• F. Tax incentives arising from research and development expenditures were accounted for using income tax credits.

(30) 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; stock dividends are recorded as stock dividends to be distributed and are reclassified to ordinary shares on the effective date of new shares issuance.

(31) Revenue recognition

• A. The Group manufactures and sells related products of semi-conductor equipment. Sales are recognized when control of the products has transferred, being when the products are delivered to the buyer, the buyer has full discretion over the price to sell the products, and there is no unfulfilled obligation that could affect the customer’s acceptance of the products.

• B. Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the products in accordance with the sales contract, or when the product is delivered to

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the shipping warehouse and the product is pulled in by the customer, or the Group has objective evidence that all criteria for acceptance have been satisfied. A receivable is recognized when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due. Revenue is only recognized to the extent that it is highly probable that a significant reversal will not occur. The estimation is subject to an assessment at each reporting date. A refund liability is recognized for expected volume discounts payable to customers in relation to sales made until the end of the reporting period.

• C. The Group is engaged in environmental automation, environmental engineering and other related services. Revenue from providing services is recognized in the accounting period in which the services are rendered. For fixed price contracts, revenue is recognized based on the actual service provided to the end of the reporting period as a proportion of the total services to be provided. This is determined based on the actual labor hours spent relative to the total expected labor hours. The customer pays at the time specified in the payment schedule. If the services rendered exceed the payment, a contract asset is recognized. If the payments exceed the services rendered, a contract liability is recognized.

• D. 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.

(32) Government grants

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

(33) Operating segments

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The Group’s 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

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

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

Revenue recognition

The Group determines whether the nature of its performance obligation is to provide the specified goods or services itself (i.e. the Group is a principal) or to arrange for the other party to provide those goods or services (i.e. the Group is an agent) based on the transaction model and its economic substance. The Group is a principal if it controls a promised good or service before it transfers the good or service to a customer. The Group recognizes revenue at gross amount of consideration to which it expects to be entitled in exchange for those goods or services transferred. The Group is an agent if its performance obligation is to arrange for the provision of goods or services by another party. The Group recognizes revenue at the amount of any fee or commission to which it expects to be entitled in exchange for arranging for the other party to provide its goods or services. Indicators that the Group controls the good or service before it is provided to a customer include the following:

• A. The Group is primarily responsible for the provision of goods or services;

• B. The Group assumes the inventory risk before transferring the specified goods or services to the customer or after transferring control of the goods or services to the customer.

• C. The Group has discretion in establishing prices for the goods or services.

• (2) Critical accounting estimates and assumptions

• The Group makes estimates and assumptions based on the expectation of future events that are believed to be reasonable under the circumstances at the end of the reporting period. The resulting accounting estimates might be different from the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below:

• Evaluation of inventories

As inventories are stated at the lower of cost and net realizable value, the Group must determine the net realizable value of inventories on balance sheet date using judgements and estimates. Due to the rapid technology innovation, the Group evaluates the amounts of normal inventory consumption, obsolete inventories or inventories without market selling value on balance sheet date, and writes down the cost of inventories to the net realizable value. Such an evaluation of inventories is 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, 2023, information on the carrying amount of inventories is provided in Note6(5).

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6. Details of Significant Accounts

(1) Cash and cash equivalents

ails of Significant Accounts Cash and cash equivalents
December31,2023 Petty cash and cash on hand 1,718 $ Checking accounts and demand deposits 2,666,817 Cash equivalents Time deposits 4,287,598 6,956,133 $	December31,2022
	431 $ 2,550,965 5,992,592 8,543,988 $

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

• B. The time deposits above mature within three months and subject to an insignificant risk of changes in value. Additionally, as of December 31, 2023 and 2022, time deposits maturing in excess of three months were not in conformity with cash and cash equivalents as defined, amounting to $3,627,151 and $1,268,520, respectively, and which were reclassified to "financial assets carried at amortized cost - current". Interest income recognized in profit or loss amounted to $123,281 and $54,714.

• C. Information about cash and cash equivalents that were pledged to others as collateral were classified as other non-current assets by the liquidity, please refer to Note 8.

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

Items Non-current items: Financial assets mandatorily measured at fair value through profit or loss Beneficiary certificates Derivative instruments Items Current items: Financial liabilities mandatorily measured at fair value through profit or loss Derivative instruments	December31,2023 27,360 $ 190 27,550 $ December31,2023 - $	December31,2022 232,097 $ - 232,097 $ December31,2022 1,336 $

• A. Financial assets at fair value through profit or loss is as follows:

• (a) Beneficiary certificate: Private fund investment.

• (b) Derivative instruments: Unsecured convertible bonds under repurchase and resale agreement.

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

Derivative instruments Beneficiary certificates	2023 2022 1,938 $ 12,753) ($ 174,873 56,858) ( 176,811 $ 69,611) ($ Years endedDecember31,

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• C. The Group entered into an agreement of retirement of partner and disposed of the Partnership of Jinan Fujie Industrial Investment Fund Partnership (limited partnership) on December 12, 2023. Disposal price is RMB 89,012 thousands, acquired cash RMB 84,699 thousands and 18% equity of MEM’S CORE CO., Ltd.. As of December 31, 2023, the amount of cash RMB 25,410 thousands has not been received, shown as “Other receivables”.

• D. The Group did not have financial assets measured at fair value through other comprehensive income pledged to others.

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

	December	31, 2023	December	31, 2022
Non-current items：
Equity instruments
Listed stocks	$	189,524	$	117,291
Unlisted stocks		102,913		76,785
	$	292,437	$	194,076

• A. The Group has elected to classify investments that are considered to be strategic investments as financial assets at fair value through other comprehensive income.

• B. The Group recognized net gain and loss in other comprehensive income for fair value change for the years ended December 31, 2023 and 2022, amounting to gain $78,482 and loss $95,549, respectively. Dividend income from equity instruments recognized in profit or loss held at end of period, amounting to $4,023 and $4,361, respectively. The Group did not derecognize dividend income from equity instruments during the year.

• C. The Group doesn’t have financial assets measured at fair value through other comprehensive income pledged to others.

(4) Accounts receivable

Notes receivable Accounts receivable Less: Allowance for uncollectible accounts (	December31,2023 144 $ 782,728 232) ( 782,640 $	December31,2022 981,065 $ 2,550,965 3,221) 2,547,744 $

• A. The Group did not hold any collateral on its accounts.

• B. As of December 31, 2023 and 2022, accounts receivable were all from contracts with customers. And as of January 1, 2022, the balance of receivables from contracts with customers amounted to $1,702,545.

• C. Information relating to credit risk is provided in Note 12(2).

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(5) Inventories

Inventories
Raw materials Work in progress Finished goods Raw materials Work in progress Finished goods	Allowance for Cost valuation loss 681,344 $ 21,442) ($ 767,215 6,338) ( 1,260,209 60,859) ( 2,708,768 $ 88,639) ($ Allowance for Cost valuation loss 1,017,760 $ 9,096) ($ 1,345,883 7,922) ( 1,504,242 43,814) ( 3,867,885 $ 60,832) ($ December 31, 2022 December31,2023	Bookvalue 659,902 $ 760,877 1,199,350 2,620,129 $
		Book value
		1,008,664 $ 1,337,961 1,460,428
		3,807,053 $

The cost of inventories recognised as expense for the year:

		Years ended	December 31,	December 31,
		2023		2022
Cost of goods sold	$	9,648,364	$	10,529,144
Loss on decline in market value		39,710		25,308
Sales of scraps	(	91,387)	(	188,572)
Others		40,103		33,807
	$	9,636,790	$	10,399,687

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(6) Property, plant and equipment

									Unfinished
								construction
			Buildings		Machinery			and equipment
			and		and		Other		under
			structures		equipment		equipment		acceptance		Total
January 1, 2023
Cost		$	576,627	$	2,513,392	$	659,977	$	1,685,949	$	5,435,945
Accumulated
depreciation	(		335,717)	(	1,104,468)	(	454,911)		-	(	1,895,096)
		$	240,910	$	1,408,924	$	205,066	$	1,685,949	$	3,540,849
2023
Opening net book
amount as at
January 1		$	240,910	$	1,408,924	$	205,066	$	1,685,949	$	3,540,849
Additions			39,462		260,253		104,815		213,888		618,418
Disposals			-	(	2,572)	(	912)		-	(	3,484)
Transfers			10,344		425,260		5,268	(	436,018)		4,854
Depreciation
charge	(		20,181)	(	255,302)	(	68,449)		-	(	343,932)
Net exchange
differences	(		2,995)	(	28,392)	(	2,713)	(	1,707)	(	35,807)
Closing net book
amount as at
December 31		$	267,540	$	1,808,171	$	243,075	$	1,462,112	$	3,780,898
At December 31
Cost		$	624,660	$	3,141,027	$	756,666	$	1,462,112	$	5,984,465
Accumulated
depreciation	(		357,120)	(	1,332,856)	(	513,591)		-	(	2,203,567)
		$	267,540	$	1,808,171	$	243,075	$	1,462,112	$	3,780,898

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									Unfinished
								construction
			Buildings		Machinery			and equipment
			and		and		Other		under
			structures		equipment		equipment		acceptance		Total
January 1, 2022
Cost		$	570,324	$	1,951,737	$	614,272	$	531,679	$	3,668,012
Accumulated
depreciation	(		313,232)	(	928,940)	(	397,253)		-	(	1,639,425)
		$	257,092	$	1,022,797	$	217,019	$	531,679	$	2,028,587
2022
Opening net book
amount as at
January 1		$	257,092	$	1,022,797	$	217,019	$	531,679	$	2,028,587
Additions			1,100		209,451		34,455		1,509,706		1,754,712
Disposals			-	(	1,525)	(	318)		-	(	1,843)
Transfers	(		158)		344,662		13,266	(	357,928)	(	158)
Depreciation
charge	(		19,475)	(	179,507)	(	61,728)		-	(	260,710)
Net exchange
differences			2,351		13,046		2,372		2,492		20,261
Closing net book
amount as at
December 31		$	240,910	$	1,408,924	$	205,066	$	1,685,949	$	3,540,849
At December 31
Cost		$	576,627	$	2,513,392	$	659,977	$	1,685,949	$	5,435,945
Accumulated
depreciation	(		335,717)	(	1,104,468)	(	454,911)		-	(	1,895,096)
		$	240,910	$	1,408,924	$	205,066	$	1,685,949	$	3,540,849

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

－ (7) Leasing arrangements lessee

• A. The Group leases various assets including land, buildings and structures. Rental contracts are typically made for periods of 5 to 35 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 loan purposes.

• B. Short-term leases with a lease term of 12 months, include dormitories and transportation equipment.

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• C. The carrying amount of right-of-use assets and the depreciation charge are as follows:

Land Buildings and structures Land Buildings and structures	December31,2023 December31,2022 Carrying amount Carryingamount 95,415 $ 101,476 $ 222,792 192,768 318,207 $ 294,244 $ 2023 2022 Depreciationcharge Depreciation charge 5,869 $ 7,075 $ 47,775 31,292 53,644 $ 38,367 $ Years ended December31,

• D. For the years ended December 31, 2023 and 2022, the additions to right- of-use assets was $81,918 and $216,655. Information relating to acquire right-of-use assets from related parties is provided in Note 7.

• E. Information on profit or loss in relation to lease contracts is as follows:

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

Years ended December 31,
2023 2022
Items affecting profit or loss
Interest expense on lease liabilities $ 11,224 $ 5,585
Expense on short-term lease contracts 47,034 31,834
$ 58,258 $ 37,419
----- End of picture text -----

• F. For the years ended December 31, 2023 and 2022, the Group’s total cash outflow for leases were $105,074 and $66,380, respectively.

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(8) Investment property

		Buildings and structures	Buildings and structures	Buildings and structures
		2023		2022
At January 1
Cost	$	74,156	$	73,842
Accumulated depreciation	(	38,282)	(	35,997)
	$	35,874	$	37,845
Opening net book amount as at January 1	$	35,874	$	37,845
Transfer (out) in	(	4,854)		158
Depreciation charge	(	2,107)	(	2,129)
Closing net book amount as at December 31	$	28,913	$	35,874
At December 31
Cost	$	63,544	$	74,156
Accumulated depreciation	(	34,631)	(	38,282)
	$	28,913	$	35,874

• A. Rental income from investment property and direct operating expenses arising from investment property are shown below:

property are shown below:
Rental income from investment property Direct operating expenses arising from the investment property that generated rental income during the year	2023 2022 15,540 $ 16,070 $ 2,107 $ 2,129 $ Years ended December31,
		16,070 $
		2,129 $

• B. The fair value of the investment property held by the Group as December 31, 2023 and 2022 were $95,184 and $111,080, respectively, which were based on the valuation of market prices estimated using comparison approach which is categorized within Level 3 in the fair value hierarchy.

• (9) Short-term loans

Type of borrowings December 31, 2023 Interest rate range Collateral Bank borrowings Bank unsecured borrowings $ 35,000 0.50%~2.00% None. Type of borrowings December 31, 2022 Interest rate range Collateral Bank borrowings Bank unsecured borrowings $ 417,640 1.90%~3.7% None.

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(10) Other payables

Other payables
Other current liabilities Salary and bonus payable Processing fees payable Employees’ compensation payable Others Provisions Supplemental loan Others	December31,2023 585,867 269,113 262,448 346,730 1,464,158 $ December31,2023 288,324 $ 52,919 52,120 393,363 $	December31,2022 723,487 541,328 209,416 417,198 1,891,429 $
		December31,2022
		511,931 $ 56,772 28,188
		596,891 $

(11) Other current liabilities

• A. Information of contract liabilities is provided in Note 6(19).

• B. The Group entered into supplemental capacity addendum contracts with its customers. The Group received the supplemental loans in advanced and reserves certain capacity to the customers. The deposits would be returned in accordance with the contracts, except the parts on December 31, 2023 and 2022 amounting to $104,235 and $327,172 due more than one year are classified as “other non-current liabilities”. Besides, the amount of estimated volume discounts in the contracts has been recognized as refund liabilities.

• C. The information of provisions is as follows:

The information of provisions is as follows:
	Provisionsforwarranty
		2023
Balance at January 1	$	56,772
Additional provisions recognized		451,548
Reversed during the year	(	412,764)
Used during the year	(	42,452)
Net exchange differences	(	185)
Balance At December 31	$	52,919

The provisions of the Group are related to the sales of the semi-conductor and automatic equipment. Provisions are estimated based on the information of the historical warranty data of the products.

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(12) Pension

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

• (b)The amounts recognized in the balance sheet are as follows: (shown as “ Other non-current (assets)liabilities”)

Present value of defined benefit obligations Fair value of plan assets ( Net defined benefit asset (	December31,2023 December 31, 2022 36,976 $ 36,122 $ 41,226) 41,017) ( 4,250) $ 4,895) ($

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

2023 At January 1 Interest cost Interest income Remeasurements: Return on plan assets Change in financial assumptions Experience adjustments Pension fund contribution Paid pension ( At December 31	Present value of defined benefit obligations 36,122 $ 470 - 36,592 - 307 774 1,081 - 697) ( 36,976 $	Fair value Net defined ofplan assets benefit asset 41,017 $ 4,895) ($ - 470 533 533) ( 41,550 4,958) ( 156 156) ( - 307 - 774 156 925 217 217) ( 697) - 41,226 $ 4,250) ($

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Present value of defined benefit obligations 2022 At January 1 41,358 $ Current service cost 78 Interest cost 290 Interest income - 41,726 Remeasurements: Return on plan assets - Change in financial assumptions 2,026) ( Experience adjustments 3,578) ( 5,604) ( Pension fund contribution - At December 31 36,122 $	Fair value Net defined ofplan assets benefit asset 37,061 $ 4,297 $ - 78 - 290 259 259) ( 37,320 4,406 2,752 2,752) ( - 2,026) ( - 3,578) ( 2,752 8,356) ( 945 945) ( 41,017 $ 4,895) ($

(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 securitisation products, etc.). With regard to the utilisation 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 two-year 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 authorised by the Regulator. The Company has no right to participate in managing and operating that Fund and therefore, the Company is 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, 2023 and 2022 is given in the Annual Labor Retirement Fund Utilisation Report announced by the government.

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

Discount rate Future salary increases	Years ended December 31	Years ended December 31
	December 31, 2023 1.20% 3.50%	December31,2022
		1.30% 3.50%

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

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Sensitivity analysis of the effect on present value of defined benefit obligation due from the changes of main actuarial assumptions was as follows:

December 31, 2023 Effect on present value of defined benefit obligation December 31, 2022 Effect on present value of defined benefit obligation

==> picture [321 x 225] intentionally omitted <==

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

Discount rate Future salary increases
Increase Decrease Increase Decrease
0.25% 0.25% 0.25% 0.25%
($ 760) $ 783 $ 672 ($ 658)
Discount rate Future salary increases
Increase Decrease Increase Decrease
0.25% 0.25% 0.25% 0.25%
($ 801) $ 826 $ 717 ($ 701)
----- 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 utilised in sensitivity analysis is the same as the method utilised in calculating net pension liability on the balance sheet.

The methods and types of assumptions used in preparing the sensitivity analysis were consistent with previous period.

• (f) Expected contributions to the defined benefit pension plan of the Company for the year ending December 31, 2024 amount to $63.

• (g) As of December 31, 2023, the weighted average duration of that retirement plan is 9 years.

• B. (a) Effective July 1, 2005, the Company has established a defined contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular employees with R.O.C. nationality. Under the New Plan, the Company and its domestic subsidiaries contribute monthly an amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment.

• (b) The Group’s subsidiary in Mainland China contributes monthly pension insurance premiums at 16% of local employees' total salaries in accordance with the pension regulations in the People’s Republic of China (PRC). 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, 2023 and 2022, were $125,065 and $102,759, respectively.

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(13) Bonds payable

Bonds payable Less: Discount on bonds payable Less: Long-term liabilities,current portion

December31,2023	December31,2023	December31,2022	December31,2022
$	1,903,700	$	1,908,000
(	38,662)	(	59,062)
$	1,865,038	$	1,848,938
	-	(	1,848,938)
$	1,865,038	$	-

• A. The issuance of domestic convertible bonds by the Company

• The terms of the second unsecured convertible bonds issued by the Company are as follows:

• i. The Company issued $2,000,000, which the amount of fundraising is $2,010,000 and the par rate is 0%, second domestic unsecured convertible bonds, as approved by the regulatory authority. The bonds mature five years from the issue date November 16, 2020 to November 16, 2025 and will be redeemed in cash at face value at the maturity date. The bonds were listed on the Taipei Exchange on November 16, 2020.

• ii. The bondholders have the right to ask for conversion of the bonds into common shares of the Company during the period from the date after three months of the bonds issue to the maturity date, except the stop transfer period as specified in the terms of the bonds or the laws/regulations. The rights and obligations of the new shares converted from the bonds are the same as the issued and outstanding common shares.

• iii. The conversion price of the bonds is set up based on the pricing model specified in the terms of the bonds, and is subject to adjustments if the condition of the anti-dilution provisions occurs subsequently. The conversion price was NTD 196.9 per share upon issuance. The Company adjusted the conversion price to NTD 171 per share as the terms of the bonds on July 9, 2023.

• iv. Under the terms of the bonds, all bonds redeemed (including bonds repurchased from the Taipei Exchange), matured and converted are retired and not to be re-issued; all rights and obligations attached to the bonds are also extinguished.

• v. The bondholders may request the Company to repurchase the convertible bonds at face value when the bonds are issued for three years.

• vi. The Company may repurchase all the bonds outstanding in cash at the bonds’ face value at any time after the following events occur: (i) the closing price of the Company’s common shares is above the then conversion price by 30% for 30 consecutive trading days during the period from the date after three months of the bonds issue to 40 days before the maturity date, or (ii) the outstanding balance of the bonds is less than 10% of total initial issue amount during the period from the date after three months of the bonds issue to 40 days before the maturity date.

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• B. Regarding the issuance of convertible bonds, the equity conversion options amounting to $158,325 were separated from the liability component and were recognized in ‘capital surplus— share options’ in accordance with IAS 32. The call options and put options embedded in bonds payable were separated from their host contracts and were recognized in ‘financial assets or liabilities at fair value through profit or loss’ in net amount in accordance with IFRS 9 because the economic characteristics and risks of the embedded derivatives were not closely related to those of the host contracts. The effective interest rates of the bonds payable after such separation ranged between 1.1122% and 1.5518%.

• C. The conversion of domestic convertible bonds by the Company: For the years ended December 31, 2023 and 2022, the $100 and $72,000 of the Company’s second unsecured domestic convertible bonds had been converted into 1 and 377 thousands shares of common stocks, and have been completed the registered. And as of December 31, 2023, holders of convertible bonds with a face value of $4,200 exercised the conversion right and obtained 24,559 units of certificate of entitlement to new shares from convertible bond (each unit can be exchanged for one outstanding share of the Company.) The registration has not been completed up till December 31, 2023.

• (14) Long-term loans

Type of borrowings Bank borrowings Secured borrowings Bank unsecured borrowings Less: Long-term liabilities, current portion ( Type ofborrowings Bank borrowings Secured borrowings Bank unsecured borrowings Less: Long-term liabilities, current portion (	December31,2023 1,233,339 $ 403,156 1,636,495 64,715) 1,571,780 $ December31,2022 1,217,659 $ 319,312 1,536,971 30,932) 1,506,039 $	Interest rate range Collateral 0.76%~1.395% Property, plant and equipment 0.76%~0.90% None Interestraterange Collateral 0.635%~1.27% Property, plant and equipment 0.635%~0.775% None

• A. The credit contracts that the subsidiary of the Company signed with the banks are provided the joint guarantee line by the parent company, please refer to Note 13.

• B. Please refer to Note 8 for further information on property, plant and equipment pledged to others as collateral.

~47~

(15) Share capital

• A. As of December 31, 2023, the Company’s authorised capital was $1,500,000, consisting of 150,000 thousand shares of ordinary share (including 8,500 thousand shares reserved for employee share options), and the paid-in capital was $971,861 with a par value of $10 (in dollars) per share. All proceeds from shares issued have been collected.

Movements in the number of the Company’s ordinary shares outstanding are as follows:

At January 1 Executive employee stock options Inssuance of shares - Private placement Conversion of convertible bonds At December 31	2023 96,792 393 - 1 97,186	2022
		87,801 497 8,117 377
		96,792

• B. To increase the Company’s working capital, the stockholders at their annual stockholders’ meeting on December 30, 2021 adopted a resolution to raise additional cash through private placement with the effective date set on April 26, 2022. The number of shares to be issued through the private placement is 8,117 thousand shares at a subscription price of $210.22 (in dollars) per share. The amount of capital raised through the private placement was $$1,706,410 which had been registered. Pursuant to the Securities and Exchange Act, the ordinary shares raised through the private placement are subject to certain transfer restrictions and cannot be listed on the stock exchange until three years after they have been issued and have been offered publicly. Other than these restrictions, the rights and obligations of the ordinary shares raised through the private placement are the same as other issued ordinary shares.

(16) Share-based payment

• A. For the years ended December 31, 2023 and 2022, the Group’s share-based payment arrangements were as follows:

Type of arrangement Employee share options Employee share options Employee share options Employee share options Employee share options	Grant date 2017.12.27 2019.09.27 2020.10.30 2021.08.09 2022.07.08	Quantity granted (thousand shares) 1,000 1,000 1,000 1,500 1,500	Contract period 5 years 5 years 5 years 5 years 5 years	Vesting conditions
				Description (1) Description (1) Description (1) Description (1) Description (1)

Employees receive 20% after 2 years of service, 60% after 3 years of service, and 100% after 4 years of service.

~48~

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

		2023	2023			2022	2022
				Weighted-			Weighted-
		No. of		average		No. of	average
		options		exercise		options	exercise
		(thousand		price		(thousand	price
		shares)		(in dollars)		shares)	(in dollars)
Options outstanding at		4,910	$	179.5		4,060	178.3 $
January 1
Options exercised	(	363)		119.4	(	650)	168.3
Options given		1,100		167.4		1,500	178.0
Options overdue	(	197)		156.8		-	-
Options outstanding at
December 31		5,450		182.0		4,910	179.5
Options exercisable at
December 31		1,249		163.0		710	131.7

• Note: Some of the exercised stock options have not been registered, so those are shown as “Advance receipts for share capital”.

• C. The Company issued common stock for years ended December 31, 2023 and 2022 amounting to 134,600 and 391,600 shares because employees exercised their stock options under the stock option plan. The registration for the shares mentioned. The registration for the shares mentioned 228,600 and 258,800 shares have not been completed in December 31, 2023 and 2022.

• D. The fair value of stock options granted on grant date is measured using the Black-Scholes optionpricing model. Relevant information is as follows:

Type of arrangement Employee share options Employee share options Employee share options Employee share options Employee share options	Grant date shares) 2017.12.27 2019.09.27 2020.10.30 2021.08.09 2022.07.08	Stock price (in dollars) 198.5 $ 115.5 173 229 178	Exercise price (in dollars) 198.5 115.5 173 229 178	Expected price volatility (%) 47.84% 44.51~ 46.91% 46.48~ 49.21% 45.82~ 47.45% 44.45~ 45.87%	Expected option life (year) 3.5~4.5 year(s) 3.5~4.5 year(s) 3.5~4.5 year(s) 3.5~4.5 year(s) 3.5~4.5 year(s)	Expected dividends (%) - - - - -	Risk-free interest rate(%) 0.58~ 0.64% 0.57~ 0.60% 0.22~ 0.23% 0.23~ 0.29% 0.96~ 1.02%	Fair value per unit
								69.9~ 78.8 38.07~ 45 61.8~ 65.95 79.12~ 90.95 59.43~ 69.03

~49~

• E. The Group’s compensation cost and capital surplus arising from share-based payment transaction amounted to $68,086 and $68,512, For the years ended December 31, 2023 and 2022, respectively.

• (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 Company has no accumulated deficit. Further, the R.O.C. Securities and Exchange Act requires that the amount of capital surplus to be capitalized mentioned above should not exceed 10% of the paidin capital each year. However, capital surplus should not be used to cover accumulated deficit unless the legal reserve is insufficient.

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2023
----- End of picture text -----

	2023
At January 1 Share-based payment transactions Employee stock options exercised Employee stock options overdue Conversion of convertible bonds Changes in equity of associates and joint ventures accounted At December 31	Employee Share stock premium Options options 3,693,366 $ 107,541 $ 128,200 $ - - 68,086 54,161 - 14,347) ( - - 12,798) ( 4,097 244) ( - - - - 3,751,624 $ 107,297 $ 169,141 $	Others 10,222 $ - - 12,798 - 229 23,249 $	Total
			3,939,329 $ 68,086 39,814 - 3,853 229
			4,051,311 $

~50~

At January 1 Inssuance of common stock Share-based payment transactions Employee stock options exercised Change for non - controlling interest Conversion of convertible bonds At December 31	Share premium 1,877,491 $ 1,625,238 - 121,701 - 68,936 ( 3,693,366 $	Employee stock Options options 111,630 $ 95,194 $ - - - 67,760 - 34,754) ( - - 4,089) - 107,541 $ 128,200 $ 2022	Others 9,526 $ - - - 696 - 10,222 $	Total 2,093,841 $ 1,625,238 67,760 86,947 696 64,847
				3,939,329 $

(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 (including adjusted undistributed earnings), and then the 10% of the remaining amount shall be set aside as legal reserve until the legal reserve equals the paid-in capital. At least, special reserve shall be appropriated or reversed according to the relevant regulations. The remainder, along with the accumulated unappropriated earnings in the prior year, shall be appropriated to shareholders as dividends, proposed the distribution plan by the Board of Directors and resolved by the shareholders at their meeting.

• B. In accordance with the Company Act, the resolution, for all or part of distributable dividends and bonus, capital surplus or legal reserve distributed in cash, will be adopted if more than 2/3 of the directors attend the Board of Directors’ meeting and more than 1/2 of the directors present agree to the resolution. This will then be reported to the shareholders ' meeting. The regulation which requires approval by the shareholders is not applicable for the above.

• C. The Company’s dividend policy shall takes into account current and future investment environment, capital needs, domestic and foreign competition, and capital budget, etc. along with shareholders’ interests and the long-term financial plans. The accumulated distributable earnings are appropriated as dividends or bonuses to shareholders, of which the distributable earnings during the current year shall account for at least 15% The dividends and bonuses can be distributed in the form of cash or shares and cash dividend shall account for at least 10% of the total dividends and bonuses distributed.

• D. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in proportion to their share ownership, the legal reserve shall not be used for any other purpose. The use of legal reserve for the issuance of stocks or cash to shareholders in proportion to their share ownership is permitted, provided that the distribution of the reserve is limited to the portion in excess of 25% of the Company’s paid-in capital.

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E. The appropriation of earnings for 2022 and 2021 have been resolved by the shareholders’ meeting on May 30, 2023 and May 27, 2022, respectively, as follows:

Legal reserve Cash dividends	Dividends per share Amount (in dollars) 229,858 $ 1,339,609 13.8 $ 1,569,467 $ 2022	Dividends per share Amount (in dollars) 155,025 $ 840,021 8.7 $ 995,046 $ 2021

The appropriation of 2022 and 2021 earnings mentioned above is not difference to the propose from the Board of Directors in February 2023 and 2022.

• F. The appropriation of 2023 earnings as proposed by the Board of Directors on February 29, 2024 is as follows:

is as follows:
Legal reserve Cash dividends	2023
	Amount 198,954 $ 1,173,260 1,372,214 $	Dividends per share (in dollars)
		12.0 $

The appropriation mentioned above of 2023 earnings has not been resolved by the shareholders as of February 29, 2024.

Information about the appropriations of earnings as proposed by the Board of Directors and resolved by the shareholders can be demanded in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

(19) Operating revenue

website of the Taiwan Stock Exchange. Operating revenue
Revenue from contracts with customers	Years endedDecember31,
	2023 13,051,357 $	2022
		14,843,221 $

A. Disaggregation of revenue from contracts with customers

The Group derives revenue from the transfer of goods over time and at a point in time. Disaggregation of revenue for the years ended December 31, 2023 and 2022 is as follows:

Years endedDecember31,2023 Revenue from external customer contracts recognized at a point in time Years endedDecember31,2022 Revenue from external customer contracts recognized at a point in time	America 11,051,122 $ America 12,506,351 $	China 401,383 $ China 536,341 $	Taiwan 1,087,403 $ Taiwan 1,184,302 $	Others 511,449 $ Others 616,227 $	Total
					13,051,357 $ Total
					14,843,221 $

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• B. Contract assets and liabilities

• (a) Contract liabilities were advance sales receipts. As of December 31, 2023 and 2022, contract liabilities were all from contracts with customers. And as of January 1, 2022, the balance of contract liabilities amounted to $44,999, respectively. Please refer to Note 7 for details of information on related parties.

• (b) Revenue recognized that was included in the contract liability balance at the beginning of years ended December 31, 2023 and 2022 were $15,935 and $28,823 respectively.

(20) Other income

Other income
Grants income Rent income Dividends income Other income, others	Years endedDecember31,
	2023 101,444 $ 15,540 4,023 40,008 161,015 $	2022
		16,964 $ 16,070 8,499 48,570 90,103 $

The grants mentioned above were related to property, plant, and equipment, and were recognized on a systematic basis over the depreciation periods.

(21) Other gains and losses

		Years ended	December31,	December31,
		2023		2022
Gain and losses on financial assets at fair value
through profit or loss	$	176,811	($	69,611)
Losses on disposals of property, plant and
equipment	(	3,109)	(	1,680)
Net foreign exchange loss	(	38,608)	(	117,417)
Other gains and losses	(	3,303)	(	3,289)
	$	131,791	($	191,997)

(22) Expenses by nature

Additional disclosures related to operating costs and operating expenses are as follows:

Employee benefit expense Depreciation expense (Note) Amortisation expense	Years ended December 31,	Years ended December 31,
	2023 2,625,137 $ 397,576 10,199 3,032,912 $	2022
		2,724,668 $ 299,077 12,478
		3,036,223 $

Note: Depreciation expense includes provision for property, plant and equipment and right-of-use assets.

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(23) Employee benefit expense

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

Years ended December 31,
Nature 2023 2022
Wages and salaries $ 2,130,012 $ 2,322,446
Employee stock options 68,086 68,512
Labour and health insurance fees 136,769 123,186
Pension costs 125,002 102,868
Other personnel expenses 165,268 107,656
$ 2,625,137 $ 2,724,668
----- End of picture text -----

• A. In accordance with the Articles of Incorporation of the Company, a ratio of distributable profit of the current year, if any, shall be distributed as employees’ compensation and directors’ remuneration after it is resolved by the Board of Directors and reported to the shareholders. The ratio shall be 3%~8% for employees’ compensation and shall not be higher than 0.5% for directors’ and supervisors’ remuneration.

• B. For the years ended December 31, 2023 and 2022, employees compensation was accrued at $139,500 and $125,239, respectively; while directors’ remuneration was accrued at $11,370 and $12,251, respectively.

• C. Employees’ compensation and directors’ and supervisors’ remuneration of 2023 and 2022 as resolved by the Board of Directors on February 29, 2024 and February 24, 2023 were agreed with those amounts recognized in the 2023 and 2022 financial statements and will be distributed in cash.

• Information about employees’ compensation and directors’ remuneration of the Company as resolved by the Board of Directors can be demanded in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

(24) Income tax expense

• A. Components of income tax expense:

at the website of the Taiwan Stock Exchange. ome tax expense Components of income tax expense:
		Years ended	December31,
		2023		2022
Current tax:
Current tax on profits for the year	$	496,290	$	565,774
Tax on undistributed surplus earnings		53,620		36,521
Effect from research and development tax credits	(	73,513)	(	64,292)
Prior year income tax underestimation		36,698		4,978
Total current tax		513,095		542,981
Deferred tax:
Origination and reversal of temporary differences		8,866		3,358
Income tax expense	$	521,961	$	546,339

~54~

B. Reconciliation between income tax expense and accounting profit

		Years endedDecember	Years endedDecember	31,
		2023		2022
Tax calculated based on profit before tax and	$	676,854	$	726,210
statutory tax rate (note)
Effect from items disallowed by tax
regulation	(	168,907)	(	145,021)
Effect from research and development tax
credits	(	73,513)	(	64,292)
Additional 5% tax on undistributed
surplus earnings		53,620		36,521
Prior year income tax underestimation		36,698		4,978
Temporary differences not recognised as
deferred tax assets	(	2,791)	(	12,057)
Income tax expense	$	521,961	$	546,339

Note: The basis for computing the applicable tax rate are the rates applicable in the respective countries where the Group entities operate.

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

				2023	2023
			Recognised
				in profit	Net	exchange
		January1		or loss	differences		December31
Temporary differences:
－Deferred tax assets:
Allowance for inventory	$	409	$	88	$	-	$	497
valuation loss
Salaries accrued at end of year		6,527		-	(	120)		6,407
Government grants		2,044	(	378)	(	30)		1,636
Impairment loss on investments
accounted for using the equity method		976		-		-		976
	$	9,956	($	290)	($	150)	$	9,516
－Deferred tax liabilities:
Recognised investment profit or
loss which is adopting equity
method	(	36,663)	(	9,208)		-	(	45,871)
Unrealized exchange gain	(	2,174)		632		-	(	1,542)
	($	38,774)	($	8,576)	$	-	($	47,413)

~55~

				2022	2022
			Recognised
				in profit	Net	exchange
		January1		or loss	differences		December31
Temporary differences:
－Deferred tax assets:
Allowance for inventory	$	287	$	122	$	-	$	409
valuation loss
Unrealized exchange loss		3,116	(	3,116)		-		-
Salaries accrued at end of year		6,567		133	(	173)		6,527
Government grants		2,305	(	434)		173		2,044
Impairment loss on investments
accounted for using the equity method		976		-		-		976
	$	13,251	($	3,295)	$	-	$	9,956
－Deferred tax liabilities:
Recognised investment profit or
loss which is adopting equity
method	(	38,774)		2,111		-	(	36,663)
Unrealized exchange gain		-	(	2,174)		-	(	2,174)
	($	38,774)	($	63)	$	-	($	38,837)

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

Amount of allowance for bad debts in excess of the limit for tax purpose Allowance for inventory valuation loss Loss on investments accounted for using the equity method Others	Years endedDecember31,	Years endedDecember31,
	2023 55,105 $ 62,880 4,115 42,183 164,283 $	2022
		36,889 $ 48,162 31,849 42,392
		159,292 $

• E. The Company’s income tax returns through 2021 have been assessed and approved by the Tax Authority.

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(25) Earnings per share

Earnings per share
Basic earnings per share Profit attributable to ordinary shareholders of the parent Diluted earnings per share Profit attributable to ordinary shareholders of the parent Assumed conversion of all dilutive potential ordinary shares Convertible bonds Employee stock options Employees’ compensation Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares Basic earnings per share Profit attributable to ordinary shareholders of the parent Diluted earnings per share Profit attributable to ordinary shareholders of the parent Assumed conversion of all dilutive potential ordinary shares Convertible bonds Employee stock options Employees’ compensation Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares	Amount aftertax 1,990,468 $ 1,990,468 $ 16,251 - - 2,006,719 $ Year Year	Weighted average number of ordinary Earnings shares outstanding per share (shareinthousands) (indollars) 97,192 20.48 $ 97,192 11,158 1,036 755 110,141 18.22 $ ended December31,2023 ended December31,2022
	Amount aftertax 2,319,754 $ 2,319,754 $ 16,090 - - 2,335,844 $	Weighted average number of ordinary shares outstanding (shareinthousands) 94,141 94,141 10,408 1,053 761 106,363	Earnings per share (indollars)
			24.64 $
			21.96 $

~57~

(26) Transactions with non-controlling interest

For the years ended December 31, 2022, the company paid the cash $121,448 to purchase 15.12% equity of the subsidiary FOX AUTOMATION TECHNOLOGY INC. The non-controlling interests decreased in $92,612, the equity attributable to owners of the parent decreased in $28,836.

(27) Supplemental cash flow information

Investing activities with partial cash payments:

Purchase of property, plant and equipment Add: Opening balance of payable on equipment Add: Ending balance of prepaid on equipment Less: Ending balance of payable on equipment Less: Opening balance of prepaid on equipment Cash paid during the period

	Years endedDecember	Years endedDecember	31,
	2023		2022
$	618,418	$	1,754,712
	61,902		28,292
	374,349		448,149
(	61,712)	(	61,902)
(	448,149)	(	55,022)
$	544,808	$	2,114,229

(28) Changes in liabilities from financing activities

Lease Short-term liabilities borrowings At January 1, 2023 301,871 $ 417,640 $ Changes in cash flow from financing activities 46,816) ( 381,632) ( Impact of changes in foreign exchange rate 4,281) ( - Changes in other non-cash items 81,918 1,008) ( ( At December 31, 2023 332,692 $ 35,000 $ Lease Short-term liabilities borrowings At January 1, 2022 105,057 $ 221,440 $ Changes in cash flow from financing activities 34,546) ( 193,341 Impact of changes in foreign exchange rate 5,868 2,859 Changes in other non-cash items 225,492 - At December 31, 2022 301,871 $ 417,640 $	Long-term borrowings (Including currentportion) 1,536,971 $ 110,276 - 10,752) 1,636,495 $ Long-term borrowings (Including currentportion) 424,825 $ 1,112,146 - - 1,536,971 $	Bonds payable Liabilities (Including from financing currentportion) activities-gross 1,848,938 $ 4,105,420 $ - 318,172) ( - 4,281) ( 16,100 86,258 1,865,038 $ 3,869,225 $ Bonds payable Liabilities (Including from financing currentportion) activities-gross 1,897,858 $ 2,649,180 $ - 1,270,941 - 8,727 48,920) ( 176,572 1,848,938 $ 4,105,420 $

~58~

7. Related Party Transactions

(1) Names of related parties and relationship

Names of related parties Relationship with the Group Hon Hai Precision Industry Co., Ltd. and its subsidiaries Group with significant influence over the (Hon Hai and subsidiaries) Group Foxconn Technology Co., Ltd and its subsidiaries Other related parties (Foxconn Technology and subsidiaries)

General Interface Solution (GIS) Holding Limited and its Other related parties subsidiaries (GIS and subsidiaries)

(2) Significant related party transactions

A. Sales

nificant related party transactions Sales
	Years ended	December31,
	2023	2022
Sales of goods:
Group with significant influence over the Group
- Hon Hai and subsidiaries	28,865 $	134,784 $

There are no similar transactions for reference for the price of the Group’s sales of goods to related parties. The collection term to related parties is 30~45 days after the invoice date.

• B. Accounts receivable

Accounts receivable: Group with significant influence over the Group - Hon Hai and subsidiaries Allowance for uncollectible accounts	December31,2023 644 $ - ( 644 $	December31,2022 36,675 $ 11) 36,664 $

The receivables from related parties arise mainly from sale transactions. The receivables are due 30~45 days after the date of sales.

• C. Other receivables from related parties

Other receivables from related parties
Other receivables from related parties: Group with significant influence over the Group - Hon Hai and subsidiaries Other related parties - GIS and subsidiaries - Others	December31,2023 1,983 $ 1,806 1,603 5,392 $	December31,2022
		1,194 $ 2,030 1,633
		4,857 $

Other receivables from related parties mainly refer to payments on behalf of others.

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• D. Lease transactions - lessee

• (a) The Group leases buildings from Hon Hai and its subsidiaries. Rental contracts are typically made for periods from years 2023 to 2027. Rents are paid quarterly.

• (b) Additions to right-of-use assets:

Additions to right-of-use assets:
Lease liabilities i. Outstanding balance: ii. Interest expense: Group with significant influence over the Group - Hon Hai and subsidiaries Group with significant influence over the Group - Hon Hai and subsidiaries Group with significant influence over the Group - Hon Hai and subsidiaries	2023 2022 81,918 $ 8,544 $ Years ended December 31, December 31, 2023 December 31, 2022 71,355 $ 7,502 $ 2023 2022 4,854 $ 1,225 $ Years ended December31,
	2023 4,854 $

• (c) Lease liabilities

E. Key management compensation

Key management compensation
Short-term employee benefits Post-employment benefits	2023 2022 64,266 $ 43,591 $ 540 472 64,806 $ 44,063 $ Years endedDecember31,
		43,591 $ 472 44,063 $

8. Pledged Assets

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

Pledged asset Purpose Unfinished construction (shown as property, plant and equipment) Long-term borrowings Time deposits (shown as other non-current assets) Guarantee of Science Park Bureau Time deposits (shown as other non-current assets) Customs guarantee	Bookvalue	Bookvalue
	December31,2023 1,402,087 $ 8,915 1,902 1,412,904 $	December31,2022
		1,388,506 $ 4,988 1,894 1,395,388 $

~60~

9. Significant Contingent Liabilities and Unrecognized Contract Commitments

(1) Contingencies

Except for the recognized provision, the Group was not expected any material liabilities that could arise from the contingent liabilities.

(2) Commitments

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

December31,2023 Property, plant and equipment 344,336 $ Investments accounted for using equity method - 344,336 $	December 31, 2022
	426,161 $ 30,710
	456,871 $

10. Significant Disaster Loss

None.

11. Significant Events after the Balance Sheet Date

The Board of Directors have approved the proposal for the appropriation of earnings in 2023 on February 29, 2024, as described in Note6(18).

12. Others

(1) Capital management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide the maximum returns for shareholders and to positively reduce the gearing ratio and the cost of capital.

(2) Financial instruments

A. Financial instruments by category

gearing ratio and the cost of capital. nancial instruments Financial instruments by category
Financial assets Financial assets at fair valuethrough profit or loss Financial assets at fair value through other comprehensive income Financial assets at amortized cost (Note) Financial liabilities Financial liabilities at fair value through profit or loss Financial liabilities atamortized cost (Note) Lease liability	December 31, 2023 27,550 $ 292,437 11,487,806 11,807,793 $ - $ 40,077,060 332,692 40,409,752 $	December31,2022
		232,097 $ 194,076 10,800,976
		11,227,149 $
		1,336 $ 7,133,846 301,871
		7,437,053 $

Note: Financial assets at amortized cost included cash and cash equivalents, current financial assets at amortized cost, accounts receivable and other receivables; and financial liabilities at amortized cost included long-term and short-term loans, accounts payable, other payables, long-term liabilities-current portion and bonds payable.

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B. Financial risk management policies

(a) Categories of risk

The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk, price risk and interest rate risk), credit risk and liquidity risk. The Group’s overall risk management policy focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial position and financial performance.

• (b) Objectives of management

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

• C. Significant financial risks and degrees of financial risks

• (a) Market risk

Foreign exchange risk

• i. Nature

The Group operates internationally and is exposed to foreign exchange risk arising from various currencies, primarily with respect to the USD and RMB. Foreign exchange rate risk arises from recognized assets and liabilities.

• ii. Management

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

• iii. Degree

The Group’s businesses involve some non-functional currency operations (the Company’s and certain subsidiaries’ functional currency: NTD; other certain subsidiaries’ functional currency: 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:

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December 31, 2023

		December31,2023	December31,2023
(Foreign currency: functional currency) Financial assets Monetary items USD:NTD USD:RMB Financial liabilities Monetary items USD:NTD USD:RMB (Foreign currency: functional currency) Financial assets Monetary items USD:NTD USD:RMB Financial liabilities Monetary items USD:NTD USD:RMB	Foreign currency amount (In thousands) 158,933 $ 47,071 76,034 34,991	Book Exchange value rate (NTD) 30.71 4,880,832 $ 7.10 1,445,550 $ 30.71 2,335,004 7.10 1,074,574 December31,2022		Sensitivity analysis
				Degree of variation 1% 1% 1% 1%	Effect on profit or loss
					48,808 $ 14,456 23,350 10,746
	Foreign currency amount (In thousands) 226,276 $ 81,937 78,301 61,682	Exchange rate 30.71 6.97 30.71 6.97	Book value (NTD) 6,948,936 $ 2,516,285 2,404,624 1,894,254	Sensitivity analysis
				Degree of variation 1% 1% 1% 1%	Effect on profit or loss
					69,489 $ 25,163 24,046 18,943

• iv. The total exchange (loss) gain, including realized and unrealized, arising from significant foreign exchange variation on the monetary items held by the Group for the years ended December 31, 2023 and 2022, amounted to $38,608 and $117,417, respectively.

Price risk

• i. The Group’s equity securities, which are exposed to price risk, are the held 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.

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• ii. The Group’s investments in equity securities comprise shares issued by the domestic and foreign companies which are classified as investments in financial assets at fair value through other comprehensive income. The prices of equity securities would change due to the change of the future value of investee companies. However, the fluctuation in prices are not expected to have significant influence over the value of investee companies.

Cash flow and fair value interest rate risk

• i. The Group’s main interest rate risk arises from long-term and short-term loans. Loans issued at fixed rates expose the Group to fair value interest rate risk. Group policy is to maintain at least 0.5%~2% of its loans at fixed rate. The Group has no significant interest rate based on the assessment.

• ii. The Group's interest rate risk arises from long-term loans. Long-term loans calculated by floating rates expose the Group to cash flow interest rate risk, but most of this risk is offset by cash and cash equivalents held at floating rates.

  • If the long-term borrowing rate increases or decreases by 1%, and all other factors remain unchanged, the net profit after tax from January 1 to December 31, 2023 and 2022 will decrease or increase by $12,839 and $7,558 respectively.

• (b) Credit risk

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

• ii. The Group adopts industrial characteristics and past experience, the default occurs when the contract payments are past due over 90 days.

• iii. Under IFRS 9 which the Group adopts, if the contract payments were past due over 30 days based on the terms, there has been a significant increase in credit risk on that instrument since initial recognition.

• iv. The following indicators are used to determine whether the credit impairment of debt instruments has occurred:

• (i) It becomes probable that the issuer will enter bankruptcy or other financial reorganization due to their financial difficulties;

• (ii) The disappearance of an active market for that financial asset because of financial difficulties;

• (iii) Default or delinquency in interest or principal repayments;

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• (iv) Adverse changes in national or regional economic conditions that are expected to cause a default.

• v. The ageing analysis of receivables (including related parties) is as follows:

December 31, 2023 Not past due 874,453 $ Up to 90 days 9,480 91 to 180 days 20,306 181 to 270 days - 271 to 360 days 241 Over 360 days 274 904,754 $	December 31, 2022
	873,867 $ 84,697 29,618 3,507 - -
	991,689 $

• vi. The Group classifies customers’ accounts receivable in accordance with credit rating. The Group applies the modified approach using the loss rate methodology or provision matrix to estimate the expected credit loss. The Group used the market forecastability of SEMI and The Basel Committee on Banking Supervision to adjust historical and timely information to assess the default possibility of notes receivable and accounts receivable. On December 31, 2023 and 2022, loss allowance estimated by the provision matrix or loss rate methodology is as follows:

December31,2023 Expected loss rate Total book value Loss allowance ( December31,2022 Expected loss rate Total book value Loss allowance (	Group1 0.03% 776,794 $ 231) $ ( Group1 0.03% 906,770 $ 271) $ (	Group2 0.03% 127,960 $ 1) $ ( Group2 0.03%~100% 84,919 $ 2,950) $ (	Total 904,754 $ 232) $ Total 991,689 $ 3,221) $

• Group 1: Standard Poor’s, Fitch’s, or Moody’s rating of A-level, or rated as A-level in accordance with the Group’s credit rating for those that do not have external credit ratings.

• Group 2: Rated as other than A in accordance with the Group’s credit rating for those that have no external credit ratings.

• vii. Movements in relation to the Group applying the modified approach to provide loss allowance for receivables (including related parties) are as follows:

allowance for receivables (including related parties) are as follows:
December31,2023 At January 1 3,221 $ Reversal of impairment loss 2,989) ( Effect of foreign exchange - At December 31 232 $	December31,2022
	1,523 $ 1,679 19
	3,221 $

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• viii. 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.

• (c) Liquidity risk

• i. Cash flow forecasting is performed in the operating entities of the Group and aggregated by Group treasury. Group treasury monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed loan facilities at all times so that the Group does not breach loan limits or covenants (where applicable) on any of its loan 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. The Group’s non-derivative financial liabilities are analysed into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

Except for those whose maturity date were less than 360 days as of December 31, 2023 and 2022, the remaining non-derivative financial liabilities (including long-term and short-term loans, accounts payable, other payables, current portion of long-term liabilities and guarantee deposits received) are listed below:

December31,2023 Non-derivativefinancial liabilities: Bonds payable (Note) Long-term borrowings Lease liability Deposits received December31,2022 Non-derivativefinancial liabilities: Bonds payable (Note) Long-term borrowings Lease liability Deposits received	Less than 1year - $ 79,038 55,293 288,324 Less than 1year 1,908,000 $ 41,616 39,327 511,931	Between 1 and 3 years 1,903,700 $ 605,412 113,592 104,235 Between 1 and 3 years - $ 513,151 76,467 327,172	Over3 years
			- $ 1,047,194 212,267 - Over3 years
			- $ 1,055,593 232,345 -

Note ： The reason of transfer of bonds payable to current liabilities is the bondholders can request the company to buy the bonds back after three years of issuance. Please refer to Note 6 (13).

(3) Fair value information

• A. The different levels that the inputs to valuation techniques are used to measure fair value of financial and non-financial instruments have been defined as follows:

• Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. A market is regarded as active where a

~66~

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 Company’s investment in derivative instruments is included in Level 2.

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

• B. The carrying amounts of the Group’s financial instruments not measured at fair value (including cash and cash equivalents, financial assets at amortized cost, accounts receivable (including due from related parties), other receivables (including due from related parties), long-term and shortterm loans, accounts payable, other payables and bonds payable (including current portion)) are approximate to their fair values.

• C. The related information of 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 at December 31,2023 and 2022 are as follows:

• (a) The related information of natures of the assets is as follows:

December 31, 2023 Assets Recurring fair value measurements Financial assets at fair value through profit or loss Beneficiary certificates Derivative instruments Financial assets at fair value through other comprehensive income Equity securities	Level 1 - $ - 189,524 189,524 $	Level 2 - $ 190 - 190 $	Level3 27,360 $ - 102,913 130,273 $	Total
				27,360 $ 190 292,437
				319,987 $

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==> picture [442 x 262] intentionally omitted <==

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

December 31, 2022 Level 1 Level 2 Level 3 Total
Assets
Recurring fair value measurements
Financial assets at fair value
through profit or loss
- -
Beneficiary certificates $ $ $ 232,097 $ 232,097
Financial assets at fair value
through other comprehensive
income
-
Equity securities 117,291 76,785 194,076
$ 117,291 $ - $ 308,882 $ 426,173
Liability
Recurring fair value measurements
Financial liabilities at fair value
through profit or loss
Derivative instruments $ - $ 1,336 $ - $ 1,336
----- End of picture text -----

• (b) The Group’s financial assets at fair value through other comprehensive income on December 31, 2023 and 2022 are financial assets included in Level 1, in order to obtain listed stocks, the Group uses closing price as their fair values.

• (c) 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 (i.e. yield curves on the Taipei Exchange, average commercial paper interest rates quoted from Reuters).

• D. For the years ended December 31, 2023 and 2022, there was no transfer between Level 1 and Level 2.

• E. The following chart is the movement of Level 3 for the years ended December 31, 2023 and 2022:

			2023		2022
At January 1		$	308,882	$	413,893
Acquired in the period			35,105		6,843
Gains and losses recognised in profit or loss			174,873	(	56,858)
Gains and losses recognised in other
comprehensive income			7,953	(	61,752)
Disposal in the period	(		395,532)		-
Effect of exchange rate changes	(		1,008)		6,756
At December 31		$	130,273	$	308,882

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• F. For the years ended December 31, 2023 and 2022, there was no transfer into or out from Level 3.

• G. 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:

Non-derivative equity instrument: Private equity fund investment Unlisted shares Non-derivative equity instrument: Private equity fund investment Unlisted shares	Fair value Significant at December Valuation unobservable 31,2023 technique input 27,360 $ Net asset value Not applicable 102,913 Market comparable companies/Net asset value Liquidity discount Fair value Significant at December Valuation unobservable 31,2022 technique input 232,097 $ Net asset value Not applicable 76,785 Market comparable companies/Net asset value Liquidity discount	Range Relationship (weighted of inputs to average) fair value Not applicable Not applicable 32%~35% The higher the discount rate, the lower the fair value. Range Relationship (weighted of inputs to average) fairvalue Not applicable Not applicable 32% The higher the discount rate, the lower the fair value.	Relationship of inputs to fair value

• H. The Group has carefully assessed the valuation models and assumptions used to measure fair value. However, use of different valuation models or assumptions may result in different measurement. The following is the effect of profit or loss or of other comprehensive income from financial assets and liabilities categorised within Level 3 if the inputs used to valuation models have changed:

Input Financial assets Equity instruments Liquidity discount Input Financial assets Equity instruments Liquidity discount	Change ±5% Change ±5%	Favourable change Unfavourable change 7,757 $ 7,757) ($ Favourable change Unfavourable change 5,674 $ 5,674) ($ December31,2023 Recognised in other comprehensive income December31,2022 Recognized in other comprehensive income

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(4) Other matters

The Group's information systems were attacked by cyber hackers on January, 2024. The information department has actived the relevant defense mechanism and recovery operations, and cooperated with technical experts from external information security companies to test and ensure information security. There is no significant impact to the Group’s financial and business based on the Group’s assessment.

13. Supplementary Disclosures

The disclosures on investee companies were based on financial statements audited by Certified Public Accountants and the following transactions with subsidiaries were eliminated when preparing consolidated financial statements. The following disclosure information is for reference only.

(1) Significant transactions information

• A. Loans to others: Please refer to table 1.

• B. Provision of endorsements and guarantees to others: Please refer to table 2.

• C. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures): Please refer to table 3.

• D. Acquisition or sale of the same security with the accumulated cost exceeding $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: None.

• 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 5.

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

• I. Trading in derivative instruments undertaken during the reporting periods: Please refer to Note 6(2).

• J. Significant inter-company transactions during the reporting periods: Please refer to table 7.

(2) Information on investees

Names, locations and other information of investee companies (not including investees in Mainland China): Please refer to table 8.

(3) Information on investments in Mainland China

• A. Basic information: Please refer to table 9.

• B. Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area: The Company provided purchases and sales to an investee company in the Mainland Area, Foxsemicon Integrated Technology (Shanghai) Inc., through SUCCESS PRAISE CORPORATION. The transactions have been fully written-off in the consolidated financial statements. Please refer to Note 13(1) for the significant transactions of purchases, sales, receivables and payables between the Company and investee companies in the Mainland Area.

~70~

(4) Major shareholders information

Major shareholders information: Please refer to Note 9.

14. Operating Segment Information

(1) General information

The Group is primarily engaged in the production and sales of semiconductor equipment subsystems and system integration. The chief operating decision-maker allocates resources and assesses performance based on the overall financial statements. It is identified that the Group is a single operating segment and there is only one reportable operating segment.

The Group’s operating segment information is prepared in accordance with the Group’s accounting policies. The chief operating decision-maker allocates resources and assesses performance of the operating segments primarily based on the operating revenue and profit (loss) before tax of individual operating segment.

(2) Information on products and services

Revenue from external customers is mainly from the sales business of abovementioned single reportable segments. Therefore products revenue is the reportable segment revenue.

(3) Geographical information

Geographical information for the years ended December 31, 2023 and 2022 is as follows:

America Taiwan China Others	Year ended December31,2023 Revenue 11,051,122 $ 1,087,403 401,383 511,449 13,051,357 $	December31,2023 Non-current assets 382,804 $ 2,080,059 2,091,193 64,921 4,618,977 $	Year ended December 31, 2022 Revenue 12,506,351 $ 1,184,302 536,341 616,227 14,843,221 $	December 31, 2022
				Non-current assets
				310,677 $ 1,998,979 2,061,318 -
				4,370,974 $

(4) Major customer information

For the years ended December 31, 2023 and 2022, details of revenue from which customers accounted for at least 10% of operating revenues in the consolidated statement of comprehensive income are as follows:

income are as follows:
Customer - Group A	Years endedDecember31,
	2023 Salesrevenue 10,931,597 $	2022
		Salesrevenue
		12,316,536 $

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Foxsemicon Integrated Technology Inc. and subsidiaries

Loans to others Years ended December 31, 2023

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

Table 1
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Expressed in thousands of NTD (Except as otherwise indicated) Maximum outstanding Collateral balance during the nine month General Is a period ended Balance at Actual Amount of Reason for Allowance Limit on loans ledger related December 31, December 31, amount Interest Nature of transactions with short-term for doubtful granted to a Ceiling on total No. Creditor Borrower account party 2023 2023 drawn down rate loan the borrower financing accounts Item Value single party loans granted Footnote 0 Foxsemicon Foxsemicon Other Y $ 767,750 $ 552,780 $ 580,860 2.80% Business $ 2,263,002 - $ - - $ - $ 2,320,448 $ 6,961,344 Notes 1 and Integrated Integrated receivables transactions 2 Technology Inc. Technology due from (Kunshan) Inc. related parties 0 Foxsemicon Foxsemicon Other Y 307,217 - - 2.70% Short-term - Business - - - $ 4,060,784 $ 4,640,896 Notes 4 Integrated Integrated receivables financing operation Technology Inc. Technology due from (Shanghai) Inc. related parties

Note 1: For the companies who have business relationship with the Company, ceiling on total loans to others shall not exceed 60% of the net assets value of the Company.

Note 2: For the companies who have business relationship with the Company, financial limit on loans granted to a single party shall not exceed the amount of business transactions occurred between the creditor and borrower. The amount of business transactions means the higher between the actual sales and the actual purchases in the last year or in the following year and shall not exceed 20% of the net assets value of the Company.

Note 3: The total loans between the foreign companies which the parent company holds 100% of the voting rights directly or indirectly should not exceed 100% of the parent company's net assets; the loans to a singal party shall not exceed 50% of the parent company's net assets.

Note 4: The total loans which the companies who have short-term financing with the parent company should not exceed 40% of the parent company's net assets; the loans to a singal party shall not exceed 35% of the parent company's net assets.

Note 5: The net assets referred to above are based on the latest audited or reviewed financial statements.

Table 1, Page 1

Table 2

Foxsemicon Integrated Technology Inc. and subsidiaries

Provision of endorsements and guarantees to others

Years ended December 31, 2023

Expressed in thousands of NTD (Except as otherwise indicated)

No. Endorser/guarantor	Partybeingendorsed/guaranteed	Limit on endorsements/gua rantees provided for a singleparty	Maximum outstanding endorsement/ guarantee amount as of December 31, 2023	Outstanding endorsement/ guarantee amount at December 31, 2023	Actual amount drawn down	Amount of endorsement s/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	Provision of endorsements/ guarantees by parent company to subsidiary	Provision of endorsements/ guarantees by subsidiary to parent company	Provision of endorsements /guarantees to the party in Mainland China	Footnote
	Companyname Relationship with the endorser/guarantor
0 Foxsemicon Integrated Technology Inc. 0 Foxsemicon Integrated Technology Inc. 0 Foxsemicon Integrated Technology Inc. 0 Foxsemicon Integrated Technology Inc.	Foxsemicon Technology, LLC. Note 1 FOX AUTOMATION TECHNOLOGY INC. Note 1 FOX AUTOMATION TECHNOLOGY INC. Note 1 Kainova Technology Inc. Note 1	5,801,120 $ 5,801,120 5,801,120 5,801,120	192,859 $ 1,360,000 456,000 100,000	192,859 $ - - -	176,736 $ 1,233,339 264,517 -	- - - -	1.66 11.72 3.93 0.86	11,602,240 $ 11,602,240 11,602,240 11,602,240 $	Y Y Y Y	N N N N	N N N N	Note 2 Note 2 Note 2 Note 2

Note 1: A subsidiary that the Company and subsidiaries directly or indirectly held more than 50% equity interets of common shares.

Note 2: The ceiling on total amount of endorsements/guarantees provided to others by the Company is the Company's net assets in the latest financial statement which was reviewed or audited by independent accountant. Limit on total endorsements/guarantees provided for a single party is 50% of the Company's net assets in the latest financial statement which was reviewed or audited by independent accountant. Note 3: Limit on endorsements and guarantees to a company of which the Company directly or indirectly holds 100%, should not exceed 10% of the company's net assets in the latest financial statement which was reviewed or audited by independent accountant. Limit on endorsements and guarantees to a single party shall not exceed 80% of the company's net assets.

Table 2, Page 1

Foxsemicon Integrated Technology Inc. and subsidiaries

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

Years ended December 31, 2023

Table 3

(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS,

EXCEPT AS OTHERWISE INDICATED)

Securities held by Marketable securities Relationship with the securities issuer General ledger account		As of December31,2023	As of December31,2023	Footnote
	Number of shares	Bookvalue	Ownership (%) Fairvalue
Foxsemicon Integrated Technology Inc. Common stock of Advanced Optoelectronic Technology, Inc. None. Financial asset measured at fair value through other comprehensive income-non-current Foxsemicon Integrated Technology Inc. Common stock of ChenFull Precision Co. Ltd None. Financial asset measured at fair value through other comprehensive income-non-current Foxsemicon Integrated Technology Inc. Partnership of AVITIC FUND None. Financial assets at fair value through profit or loss - non-current MINDTECH CORPORATION Common stock of SuperbVue Solutions Inc. None. Financial asset measured at fair value through other comprehensive income-non-current MINDTECH CORPORATION Common stock of Pollux Technologies, Inc. None. Financial asset measured at fair value through other comprehensive income-non-current MINDTECH CORPORATION Common stock of Linyange Semiconductor, Inc. None. Financial asset measured at fair value through other comprehensive i Foxsemicon Integrated Technology (Shanghai) Inc. MEMS CORE Co., Ltd. None. Financial assets at fair value through profit or loss - non-current	3,672,000 745,000 - 12,250,000 7,350,000 4,900,000 137,754	108,691 $ 80,833 27,360 11,131 49,296 26,503 15,983	2.54 108,691 $ 1.26 80,833 8.00 27,360 10.03 11,131 11.60 49,296 10.03 26,503 18.00 15,983	Note Note Note

Note:The shareholding ratio above is agreed upon in the investment contract and the article of association of those companies. However, it is still in the period of capital injection.

Table 3, Page 1

Foxsemicon Integrated Technology Inc. and subsidiaries

Table 4

Securities acquired or sold at costs, or prices at least NT$300 million or 20% of the paid-in capital during this period

Years ended December 31, 2023

單位：仟元 ( 除特別註明者外 )

Investor	Marketable securities	General ledger account	Counterparty	Relationship with the investor	Transaction currency	Balance as at De	cember31,2023	Buy	Buy		Disposal	Disposal		As of Decem	ber 31,2023
						Number of shares	Amount	Number of shares	Amount	Number of shares	Selling price	Book value (Note5)	Gain (loss) on disposal	Number of shares	Amount
Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology (Shanghai) Inc.	UniEQ Integrated Technology Co., Ltd. Jinan Fujie Industrial Investment Fund Partnership (limited partnership)"	Note 1 Note 3	UniEQ Integrated Technology Co., Ltd. Jinan Fujie Industrial Investment Fund Partnership (limited partnership)"	Note 2 -	USD RMB	- Note 4	$ - RMB 49,714 thousand	16,000,000	USD 45,768 thousand	- Note 4	$ - RMB 89,012 thousand	$ - RMB 89,012 thousand	$ - -	16,000,000	USD 45,768 thousand

Note 1: Code of general ledger account is "investments accounted for under equity method". Note 2: A subsidiary directly owned by the Company with 100% ownership. Note 3: Code of general ledger account is "financial assets at fair value through profit or loss". Note 4: The Company is a limited company and has no shares.

Note 5: The book value of financial assets at fair value through profit or loss is the amount evaluated at fair value, including the gain and loss of fair value evaluation.

Table 4, Page 1

Foxsemicon Integrated Technology Inc. and subsidiaries

Table 5

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

Years ended December 31, 2023

Expressed in thousands of NTD

(Except as otherwise indicated)

Purchaser/seller	Counterparty	Relationship with the counterparty		Transaction	Transaction		Compared to third	partytransactions	Notes/accounts receivable(payable)	Notes/accounts receivable(payable)	Footnote
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unitprice	Credit term	Balance	Percentage of total notes/accounts receivable(payable)
Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology (Shanghai) Inc. Foxsemicon Integrated Technology (Shanghai) Inc. Foxsemicon Integrated Technology (Kunshan) Inc. SUCCESS PRAISE CORPORATION	SUCCESS PRAISE CORPORATION Foxsemicon Integrated Technology (Kunshan) Inc. SUCCESS PRAISE CORPORATION Frontier Integrated Global Solutions, Inc. Foxsemicon Integrated Technology (Shanghai) Inc. Frontier Integrated Global Solutions, Inc.	Subsidiaries Subsidiaries Affiliated company Affiliated company Affiliated company Affiliated company	Purchases Purchases Sale Sale Sale Sale	5,366,113 $ 2,263,002 5,855,383 177,838 790,960 409,444	68 29 92 3 25 7	60 days from the invoice date 60 days from the invoice date 45 days from the invoice date 45 days from the invoice date 45 days from the invoice date 45 days from the invoice date	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	No significant difference No significant difference No significant difference No significant difference No significant difference No significant difference	853,469) ($ 345,106) ( 1,013,151 56,533 178,154 77,236	62) ( 25) ( 80 4 33 8

Note 1: If there are no similar transactions, the prices and terms were determined in accordance with mutual agreements. Otherwise, the transaction terms were similar to general transaction terms. Note 2: Opposite related party transaction is not disclosed.

Table 5, Page 1

Foxsemicon Integrated Technology Inc. and subsidiaries

Table 6

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

Years ended December 31, 2023

Expressed in thousands of NTD

(Except as otherwise indicated)

Creditor	Counterparty	Relationship with the counterparty	Balance as at December 31, 2023	Turnover rate	Overdue receivables	Overdue receivables	Amount collected subsequent to the balance sheet date	Creditor Counterparty doubtful
					Amount	Action taken
Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. SUCCESS PRAISE CORPORATION Foxsemicon Integrated Technology (Shanghai) Inc. Foxsemicon Integrated Technology (Kunshan) Inc. Foxsemicon Integrated Technology (Kunshan) Inc.	Foxsemicon Integrated Technology Foxsemicon Integrated Technology Foxsemicon Integrated Technology Inc. SUCCESS PRAISE CORPORATION Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology (Shanghai) Inc.	Subsidiaries Subsidiaries Ultimate parent Affiliated company Ultimate parent Parent company	549,919 $ Note 641,219 Note 853,469 1,013,151 345,106 178,154	Not applicable Not applicable 5.2 5.6 5.4 3.6	75,609 $ 425 - 137,428 91,960 160	Positive Positive - Subsequent collection Subsequent collection Subsequent collection	71,004 $ 120 - 137,428 56,762 160	$ - - - - - -

Note: Receivables arose from purchasing materials on behalf of others and financing inter-related party. Financing inter-related please refer to Note 13(1).

Table 6, Page 1

Table 7

Foxsemicon Integrated Technology Inc. and subsidiaries

Significant inter-company transactions during the reporting periods

Years ended December 31, 2023

Expressed in thousands of NTD

(Except as otherwise indicated)

Number (Note 1)	Companyname	Counterparty	Relationship (Note 2)		Tra	nsaction(Note 4)
				General ledger account	Amount	Transaction terms	Percentage of consolidated total operating revenues or total assets(Note3)
0 0 0 0 0 0 1 1 1 2 2 3	Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology (Shanghai) Inc. Foxsemicon Integrated Technology (Shanghai) Inc. Foxsemicon Integrated Technology (Shanghai) Inc. Foxsemicon Intgrated Technology(Kunshan) Inc. Foxsemicon Intgrated Technology(Kunshan) Inc. SUCCESS PRAISE CORPORATION	SUCCESS PRAISE CORPORATION SUCCESS PRAISE CORPORATION Foxsemicon Integrated Technology (Shanghai) Inc. Foxsemicon Integrated Technology (Kunshan) Inc. Foxsemicon Integrated Technology (Kunshan) Inc. Foxsemicon Integrated Technology (Kunshan) Inc. SUCCESS PRAISE CORPORATION SUCCESS PRAISE CORPORATION Frontier Integrated Global Solutions, Inc. Foxsemicon Integrated Technology (Shanghai) Inc. Foxsemicon Integrated Technology (Shanghai) Inc. Frontier Integrated Global Solutions, Inc.	(1) (1) (1) (1) (1) (1) (3) (3) (3) (2) (2) (3)	Purchases Accounts payable Other receivable Purchases Accounts payable Other receivable Sales Accounts receivable Sales Sales Accounts receivable Sales	5,366,113 $ 853,469 549,919 2,263,002 345,106 641,219 5,855,383 1,013,151 177,838 790,960 178,154 409,444	45 days from the invoice date 45 days from the invoice date 45 days from the invoice date 45 days from the invoice date 45 days from the invoice date 45 days from the invoice date 45 days from the invoice date 45 days from the invoice date 45 days from the invoice date 45 days from the invoice date 45 days from the invoice date 45 days from the invoice date	41 4 3 17 2 3 45 5 1 6 1 3

• 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; fill in the number of category each case belongs to: (1)Parent company to subsidiary.

• (2)Subsidiary to parent company.

• (3)Subsidiary to subsidiary.

Note 3: The disclosures are related parties reaching $100 million or 20% of paid-in capital or more only, otherwise are not disclosed.

Note 4: Percentage of total consolidated revenues or total assets is calculated using the total consolidated assets at the end of the year when the subject of transaction is an asset/liability, and is calculated by total consolidated revenues during the year when the subject of transaction is a revenue/expense. However, the transactions were eliminated when preparing the consolidated financial statements.

Table 7, Page 1

Foxsemicon Integrated Technology Inc. and subsidiaries

Table 8

Expressed in thousands of NTD

Information on investees

Years ended December 31, 2023

(Except as otherwise indicated)

Investor	Investee	Location	Main business activities	Initial invest	ment amount	Shares held	as at Decemb	er 31,2023	Net income of investee as of December 31,2023	( ) recognised by the Company for the nine monthperiod ended	Footnote
				Balance as at December 31,2023	Balance as at December 31,2023	Number of shares	Ownership (%)	Book value
Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. Foxsemicon Integrated Technology Inc. FOXSEMICON INTEGRATED TECHNOLOGY INC. FOXSEMICON INTEGRATED TECHNOLOGY INC. Foxsemicon Innovations Holding Inc.	FOXSEMICON INTEGRATED TECHNOLOGY INC. Foxsemicon Innovations Holding Inc. FOXSEMICON LLC. UNIEQ TECHOLOGY PTE.LTD FOX AUTOMATION TECHNOLOGY INC. Frontier Integrated Global Solutions, Inc. Kainova Technology Inc. Lydus Medical Ltd. SMART BREAST CORPORATION Corporate Venture Capital Alliance Innovation Fund UniEQ Integrated Technology Co., Ltd. MINDTECH CORPORATION SUCCESS PRISE CORPORATION Foxsemicon Technology, LLC	Samoa US US Singapore Taiwan Taiwan Taiwan Israel US Taiwan Thiland Samoa Samoa US	Reinvestment and holding company Reinvestment and holding company Exports/Imports Logistics Reinvestment and holding company Manufacturing of machinery and equipment and electronic parts Manufacturing of machinery and equipment and electronic parts Manufacturing of machinery and equipment and electronic parts Research, design and sale of medical machinery Manufacturing of medical machinery Reinvestment and holding company Manufacturing of machinery and equipment and electronic parts Reinvestment and holding company Reinvestment and holding company Research and Development and manufacturing of machinery and equipment and electronic parts	$ 1,253,890 451,191 1,751 1 312,573 5,000 55,000 89,790 17,643 22,500 1,447,108 2,395,380 116,698 459,115	$ 1,253,890 451,191 1,751 - 312,573 5,000 55,000 59,560 17,643 22,500 - 2,395,380 116,698 459,115	40,474,913 15,000,000 50,000 1 20,000,000 500,000 5,500,000 416,310 7,890,640 2,250,000 16,000,000 34,977,541 3,800,000 Note 2	100 100 100 100 100 100 100 16.21 17.62 25 100 100 100 100	$ 4,443,184 341,317 32,322 - 1,022,053 50,072 69,492 77,818 - 18,887 1,427,688 4,341,933 101,242 340,788	$ 724,260 ( 86,746) ( 48) - 206,870 28,399 27,851 ( 41,305) ( 21,595) ( 9,854) ( 23,393) 711,513 12,747 ( 85,724)	$ 724,260 ( 86,746) ( 48) - 206,870 28,399 27,851 ( 6,364) - ( 2,464) ( 23,393) 711,513 12,747 ( 84,724)	Note 1 Note 1

Note 1:The Company started to recognize gain or loss of associates and joint ventures accounted for using equity method in the month of acquisition Note 2: The company is a limited company and has no shares issued.

Table 8, Page 1

Foxsemicon Integrated Technology Inc. and subsidiaries

Information on investments in Mainland China

Years ended December 31, 2023

Table 9

Expressed in thousands of NTD (Except as otherwise indicated)

Investee in Mainland China	Main business activities	Paid-in capital (Note 1)	Investment method (Note 2)	Accumulated amount of remittance from Taiwan to Mainland China as of December 31,2023	Amount re Taiwan to China/Amo back to Tai years ended 20	mitted from Mainland unt remitted wan for the December 31, 23	Accumulated amount of remittance from Taiwan to Mainland China as of December 31, 2023	Net income of investee as of December 31, 2023	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the years ended December 31, 2023 (Note 3)	Book value of investments in Mainland China as of December 31,2023	Accumulated amount of investment income remitted back to Taiwan as of December 31, 2023	Footnote
					Remitted to Mainland China	Remitted back to Taiwan
Foxsemicon Integrated Technology (Shanghai) Inc. Kaivaco Technology Nanjing Inc.	Production and sales of electronic special equipment, test instruments, and industrial molds Production and sales of electronic special equipment, test instruments, and industrial molds	2,395,380 $ 6,117	2 1	2,395,380 $ 6,117	- $ -	- $ -	2,395,380 $ 6,117	707,175 $ 117	100 100	707,175 $ 117	4,269,248 $ 6,541	- $ -

Companyname	Accumulated amount of remittance from Taiwan to Mainland China as of December 31,2023	Investment amount approved by the Investment Commission of the Ministry of Economic Affairs (MOEA)	Ceiling on investments in Mainland China imposed by the Investment Commission of MOEA
Foxsemicon Integrated Technology Inc. Kainova Technology Inc.	2,395,380 6,117	3,346,513 6,603	Note 4 80,000

Note 1: The amounts in the table are shown in New Taiwan Dollars. Transactions denominated in foreign currencies are translated into New Taiwan Dollars at the spot exchange rates at the balance sheet date. Note 2: Investment methods are classified into the following three categories; fill in the number of category each case belongs to:

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

(2)Invested in Mainland China thorugh the thrid party, FOXSEMICON INTERGRATED TECHNOLOGY INC.

(3)Others

Note 3:Investment income (loss) recognition is based on financial statements that are audited or reviewed by R.O.C. parent company's CPA.

Note 4: Pursuant to the amended ‘Guidelines Governing the Review of Investment or Technical Cooperation in the Mainland Area’ dated on August 29, 2008, as the Company has obtained the certificate of being qualified for operating headquarters, issued by the Industrial Development Bureau, MOEA, the ceiling amount of the investment in Mainland China is not applicable to the Company.

Note 5:The Company reinvested in Mainland China investees, Foxsemicon Integrated Technology (Kunshan) Inc. and Shanghai EnvoFox integrated technology limit inc. through the investing business in Mainland China investee, which were not required to file an application to the Investment Commission of Ministry of Economic Affairs (MOEA).However, the investing business in Mainland China is a controlling company and shall apply the reinvestment to the Investment Commission of Ministry of Economic Affairs (MOEA).

Table 9, Page 1

Foxsemicon Integrated Technology Inc. and subsidiaries

Major shareholders information

December 31, 2023

Table 10

Name of major shareholders		Shares
	Number of shares held(shares)	Ownership (%)
Applied Materials Taiwan Hyield Venture Capital Co.,Ltd.	8,117,258 6,953,272	8.33 7.13

Note: The major shareholders' information was derived from the data using the Company issued common shares in dematerialised form which were registered and held by the shareholders above 5% on the last operating date of each quarter and was calculated by Taiwan Depository & Clearing Corporation. The share capital which was recorded on the financial statements may be different from the actual number of shares in dematerialised form due to the difference of calculation basis.

Table 10, Page 1