FTC — Audit Report / Information 2021

Nov 12, 2021

FOXCONN TECHNOLOGY CO., LTD. AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND

INDEPENDENT AUDITORS’ REPORT DECEMBER 31, 2021 AND 2020 (STOCK CODE: 2354)

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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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INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

Financial Review No. 21004679 (2022) To the Board of Directors and Shareholders of Foxconn Technology Co., Ltd.

Opinion

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

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2021 and 2020, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the “Regulations Governing the Preparations of Financial Reports by Securities Issuers” and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission.

Basis for opinion

We conducted our audits of the consolidated financial statements in accordance with the“Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants”,and generally accepted auditing standards in the Republic of China (ROC GAAS) for our audits of the consolidated financial statements as of and for the year ended December 31, 2021. 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 Code of Professional Ethics for Certified Public Accountants in the Republic of China (the“Code”), and we have fulfilled our other ethical responsibilities in accordance with the Code. 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 consolidated financial statements of the current period. 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.

Revenue cutoff

Description

Please refer to Note 4(30) to the consolidated financial statements for accounting policy of revenue recognition and Note 6(21) for details of revenues.The Group has three sale transaction types,including (1) direct shipment from the factory, (2) FOB destination, and (3) hub. For FOB destination and hub, revenue is recognized when goods are shipped to destination or picked up by customers (when controls of the products are transferred). The supporting documents of revenue recognition include receipts from customers (FOB destination), reports or other information provided by hub custodians and inventory movement record of hub.As the hubs are located around the world with numerous custodians, the frequency and contents of statements provided by custodians vary, and the process of revenue recognition involves numerous manual procedures, these factors may potentially result in inaccurate timing of sales revenue recognition and discrepancy between physical inventory quantities in the hubs and quantities as reflected in accounting records.

Since there are numerous daily revenue from hubs and from FOB destination and the transaction amounts prior to and after the balance sheet date are significant to the financial statements, revenue cutoff has been identified as a key audit matter.

How our audit addressed the matter

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

1. We evaluated and tested Group’s controls in respect of the revenue recognition.

2. We tested sales transactions that took place shortly before and after the balance sheet date, by verifying customers’ receipt notes, supporting documents provided by hub custodian, inventory movement records, and costs of goods sold recognized in the correct reporting periods.

3. Confirmed or physical inventoried quantities held by distribution warehouses and agreed to accounting record. Assessed the reasonableness for reconciling item identified through confirmation or physical inventory, if any, and inspected respective supporting documents and rationale.

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Provision for inventory valuation losses

Description

Please refer to Note 4(14) for accounting policies on inventory valuation , Note 5(2) for uncertainty of accounting estimates and assumptions in relation to inventory valuation losses, and Note 6(6) for details of inventories. As at December 31, 2021, the Group’s inventories and provision for inventory valuation losses amounted NT$ 5,664,140 thousand and NT$ 74,012 thousand, respectively.

The Group is primarily engaged in manufacturing and sales of 3C electronic products. Due to rapid technological innovations, shorten electronic product life cycles and the fluctuation of market prices, there is a higher risk of inventory losses due from market value decline or obsolescence. The Group recognises inventories at the lower of cost and net realisable value and inventory valuation losses are provided against inventory aged over a certain period of time and individually identified as obsolete or damaged, which the net realisable value is determined based on historical data of inventory closeout.

As the amounts of inventory are material, types of inventories vary, the identification of obsolete or damaged inventories and determination of net realisable value are subject to management and audit judgment, and therefore, it was identified as a key audit matter.

How our audit addressed the matter

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

A:Ensured consistent application of policies in relating to provision for inventory valuation losses and in compliance with respective accounting guidance.

B:Validated the appropriateness of system logic of inventory aging report utilised by management in assessing inventory valuation losses and sampled and tested transactions for proper categorisation in inventory aging report.

C:Assessed the reasonableness of inventory valuation losses through discussing with management for net realizable value of obsolete or damaged inventories and validating supporting documents provided.

Other matter – Parent company only financial reports

We have audited and expressed an unmodified opinion on the parent company only financial statements of Foxconn Technology Co., Ltd. as of and for the years ended December 31, 2021 and 2020.

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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 Governingthe Preparations of Financial Reports by Securities Issuers” and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

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.

Auditor’s 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 a 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 ROC GAAS 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 ROC GAAS, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

A:Identify and assess the risks of material misstatement of the consolidated financial statements, whether

due to fraud or error, design and perform aud it 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 controls.

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• B: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 controls.

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

• D: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 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 report. However, future events or conditions may cause the Group to cease to continue as a going concern.

• E: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.

• F: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.

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 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.

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Feng, Jackie Hsu, Chien-Ju

For and on behalf of PricewaterhouseCoopers, Taiwan March 23, 2022

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

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

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FOXCONN TECHNOLOGY CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2021 AND 2020

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

Assets	Notes 6(1) 6(2) 6(4) and 8 6(5) 7 7 6(6) 6(2) 6(3) 6(4) 6(7) 6(8) and 7 6(9), 7 and 8 6(11) 6(12) 6(27)	December 31, 2021 AMOUNT % $ 71,725,408 41 22,357 - 11,975,840 7 17,395,464 10 7,957,259 5 3,811,537 2 5,590,128 3 348,616 - 118,826,609 68 286,888 - 38,345,819 22 2,177,032 1 4,730,284 3 4,558,413 3 1,189,406 1 1,247,824 1 1,366,313 1 931,182 - 737,844 - 55,571,005 32 $ 174,397,614 100	December 31, 2020	December 31, 2020
		AMOUNT $ 71,725,408 22,357 11,975,840 17,395,464 7,957,259 3,811,537 5,590,128 348,616 118,826,609 286,888 38,345,819 2,177,032 4,730,284 4,558,413 1,189,406 1,247,824 1,366,313 931,182 737,844 55,571,005 $ 174,397,614	AMOUNT $ 76,101,991 63,079 17,647 18,262,123 11,376,433 2,424,374 4,995,578 370,959 113,612,184 524,752 36,601,116 3,048,215 5,259,090 4,960,067 1,124,777 1,279,045 1,481,287 571,646 647,541 55,497,536 $ 169,109,720	%
Current assets 1100 Cash and cash equivalents 1110 Current financial assets at fair value through profit or loss 1136 Current financial assets at amortized cost, net 1170 Accounts receivable, net 1180 Accounts receivable due from related parties, net 1200 Other receivables 130X Inventories 1470 Other current assets 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 1535 Non-current financial assets at amortized cost, net 1550 Investments accounted for under equity method 1600 Property, plant and equipment 1755 Right-of-use assets 1760 Investment property - net 1780 Intangible assets 1840 Deferred tax assets 1900 Other non-current assets 15XX Total non-current assets 1XXX Total assets				45 - - 11 7 1 3 -
				67
				- 22 2 3 3 1 1 1 - -
				33
				100

(Continued)

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FOXCONN TECHNOLOGY CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2021 AND 2020

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

Liabilities and Equity	December 31, 2021 December 31, 2020 Notes AMOUNT % AMOUNT % 6(13) and 7 $ 22,509,000 13 $ 15,946,381 9 6(2) 6,015 - 214,420 - 6,569,172 4 7,815,684 5 7 20,677,460 12 21,768,465 13 6(14) and 7 10,906,243 6 10,851,743 6 1,001,718 - 901,434 1 7 46,911 - 156,494 - 268,930 - 357,995 - 61,985,449 35 58,012,616 34 6(27) 822,300 1 574,504 1 7 408,769 - 174,428 - 6(15) 156,896 - 79,417 - 1,387,965 1 828,349 1 63,373,414 36 58,840,965 35 6(16) 14,144,852 8 14,144,852 8 6(17) 7,538,805 4 7,527,365 4 6(18) 13,201,705 8 12,731,133 8 70,485,119 40 68,602,338 41 6(19) 5,774,891 4 7,309,809 4 111,145,372 64 110,315,497 65 6(20) ( 121,172) - ( 46,742) - 111,024,200 64 110,268,755 65 9 11 $ 174,397,614 100 $ 169,109,720 100	December 31, 2020	December 31, 2020
			%
Current liabilities 2100 Short-term loans 2120 Current financial liabilities at fair value through profit or loss 2170 Accounts payable 2180 Accounts payable to related parties 2200 Other payables 2230 Current tax liabilities 2280 Current lease liabilities 2300 Other current liabilities 21XX Total current liabilities Non-current liabilities 2570 Deferred tax liabilities 2580 Non-current lease liabilities 2600 Other non-current liabilities 25XX Total non-current liabilities 2XXX Total liabilities Equity attributable to owners of parent Share capital 3110 Ordinary share Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3350 Unappropriated retained earnings Other equity interest 3400 Other equity interest 31XX Total equity attributable to owners of parent 36XX Non-controlling interests 3XXX Total equity Commitments and Contingent Liabilities Significant Subsequent Events 3X2X Total liabilities and equity			9 - 5 13 6 1 - -
			34
			1 - -
			1
			35
			8 4 8 41 4
			65 -
			65
			100

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

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FOXCONN TECHNOLOGY CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2021 AND 2020

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

Items

Year ended December 31 2021 2020 Notes AMOUNT % AMOUNT % 6(21) and 7 $ 104,082,031 100 $ 104,789,599 100 6(6) and 7 ( 96,823,495) ( 93) ( 98,320,026) ( 94) 7,258,536 7 6,469,573 6 6(25) and 7 ( 845,529) ( 1) ( 621,879) ( 1) ( 1,206,493) ( 1) ( 1,487,145) ( 1) ( 1,612,511) ( 2) ( 1,742,124) ( 2) ( 3,664,533) ( 4) ( 3,851,148) ( 4) 3,594,003 3 2,618,425 2 6(22) 1,606,780 1 2,034,933 2 6(23) and 7 1,250,585 1 1,436,652 1 6(24) and 7 ( 269,669) - ( 102,811) - 7 ( 147,212) - ( 249,299) - 6(7) ( 428,240) - ( 302,130) - 2,012,244 2 2,817,345 3 5,606,247 5 5,435,770 5 6(27) ( 1,191,611) ( 1) ( 749,647) ( 1) $ 4,414,636 4 $ 4,686,123 4

4000 Operating revenue 5000 Operating costs 5900 Gross profit from operations Operating expenses 6100 Selling expenses 6200 Administrative expenses 6300 Research and development expenses 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 under equity method 7000 Total non-operating income and expenses 7900 Profit before income tax 7950 Tax expense 8200 Profit

(Continued)

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FOXCONN TECHNOLOGY CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2021 AND 2020

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

Items

Year ended December 31 2021 2020 Notes AMOUNT % AMOUNT % 6(15) ($ 6,957) - ($ 15,784) - 6(3)(19) 527,662 1 2,262,646 2 6(27) 1,391 - 3,157 - 522,096 1 2,250,019 2 6(19)(20) ( 1,534,648) ( 2) ( 1,506,922) ( 1) 6(7)(19) ( 112,006) - ( 230,049) - ( 1,646,654) ( 2) ( 1,736,971) ( 1) ($ 1,124,558) ( 1) $ 513,048 1 $ 3,290,078 3 $ 5,199,171 5 $ 4,488,906 4 $ 4,718,343 4 ( 74,270) - ( 32,220) - $ 4,414,636 4 $ 4,686,123 4 $ 3,364,508 3 $ 5,232,098 5 ( 74,430) - ( 32,927) - $ 3,290,078 3 $ 5,199,171 5 6(28) $ 3.17 $ 3.34 $ 3.16 $ 3.32

Components of other comprehensive income that will not be reclassified to profit or loss 8311 Actuarial losses on defined benefit plans 8316 Unrealized (losses) gains from investments in equity instruments measured at fair value through other comprehensive income 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8310 Other comprehensive income that will not be reclassified to profit or loss Components of other comprehensive income that will be reclassified to profit or loss 8361 Exchange differences on translation 8370 Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will be reclassified to profit or loss 8360 Other comprehensive loss that will be reclassified to profit or loss 8300 Other comprehensive (loss) income, net 8500 Total comprehensive income Profit (loss) attributable to: 8610 Owners of parent 8620 Non-controlling interests Comprehensive income (loss) attributable to: 8710 Owners of parent 8720 Non-controlling interests 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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FOXCONN TECHNOLOGY CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY YEARS ENDED DECEMBER 31, 2021 AND 2020

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

Year ended December 31, 2020 Balance at January 1, 2020 Profit (loss) Other comprehensive income (loss) Total comprehensive income (loss) Appropriation and distribution of 2019 earnings: Legal reserve Reversal of special reserve Cash dividends Changes in equity of investment in associates and joint ventures accounted for using equity method Balance at December 31, 2020 Year ended December 31, 2021 Balance at January 1, 2021 Profit (loss) Other comprehensive income (loss) Total comprehensive income (loss) Disposals of financial assets at fair value through other comprehensive income Changes in equity of associates and joint ventures accounted for unde equity method Appropriations and distribution of 2020 earnings: Legal reserve Cash dividends Balance at December 31, 2021	Notes								Equityattributable to	o	wners of theparent								Non-controlling interests		Total equity
			Ordinaryshare		Total capital surplus, additional paid-in capital				Retained Earnings				Other equityinterest				Total
							Legal reserve		Special reserve		Unappropriated retained earnings	d	Financial statements translation ifferences of foreign operations		Total Unrealised gains (losses) from financial assets measured at fair value through other comprehensive income
	6(19)(20) 6(18) 6(19)(20) 6(3)(19) r 6(7) 6(18)		$ 14,144,852 - - - - - - - $ 14,144,852 $ 14,144,852 - - - - - - - $ 14,144,852		$ 7,527,178 - - - - - - 187 $ 7,527,365 $ 7,527,365 - - - - 11,440 - - $ 7,538,805		$ 12,018,153 - - - 712,980 - - - $ 12,731,133 $ 12,731,133 - - - - - 470,572 - $ 13,201,705		$ 46,492 - - - - ( 46,492 ) - - $ - $ - - - - - - - - $ -		$ 68,099,323 4,718,343 ( 12,627 ) 4,705,716 ( 712,980 ) 46,492 ( 3,536,213 ) - $ 68,602,338 $ 68,602,338 4,488,906 ( 5,566 ) 4,483,340 416,086 - ( 470,572 ) ( 2,546,073 ) $ 70,485,119		($ 6,126,569 ) - ( 1,736,264 ) ( 1,736,264 ) - - - - ($ 7,862,833 ) ($ 7,862,833 ) - ( 1,646,494 ) ( 1,646,494 ) - - - - ($ 9,509,327 )		$ 12,909,996 - 2,262,646 2,262,646 - - - - $ 15,172,642 $ 15,172,642 - 527,662 527,662 ( 416,086 ) - - - $ 15,284,218		$ 108,619,425 4,718,343 513,755 5,232,098 - - ( 3,536,213 ) 187 $ 110,315,497 $ 110,315,497 4,488,906 ( 1,124,398 ) 3,364,508 - 11,440 - ( 2,546,073 ) $ 111,145,372		($ 13,815 ) ( 32,220 ) ( 707 ) ( 32,927 ) - - - - ($ 46,742 ) ($ 46,742 ) ( 74,270 ) ( 160 ) ( 74,430 ) - - - - ($ 121,172 )		$ 108,605,610 4,686,123 513,048 5,199,171 - - ( 3,536,213 ) 187 $ 110,268,755 $ 110,268,755 4,414,636 ( 1,124,558 ) 3,290,078 - 11,440 - ( 2,546,073 ) $ 111,024,200

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

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FOXCONN TECHNOLOGY CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2021 AND 2020

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

CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax Adjustments Income and expenses having no effect on cash flows Depreciation (including investment property and right-of-use assets) Amortization Expected credit gain Net loss on financial assets or liabilities at fair value through profit or loss Gain on disposal of investments Gain on disposal of property, plant and equipment Interest expense Interest income Dividend income Share of loss of associates and joint ventures accounted for under equity method Changes in assets/liabilities relating to operating activities Changes in operating assets Accounts receivables net Accounts receivables due from related parties Other receivables Inventories Other current assets Net changes in liabilities relating to operating activities Accounts payable Accounts payable to related parties Other payables Other current liabilities Cash inflow generated from operations Income taxes paid Income tax refunded Net cash flows from operating activities

Year ended December 31 Notes 2021 2020 $ 5,606,247 $ 5,435,770 6(25) 1,360,958 1,439,165 6(25) 114,549 118,095 12(2) ( 1,186 ) ( 699 ) 83,745 47,971 6(24) - ( 11,693 ) 6(24) ( 85,378 ) ( 238,298 ) 147,212 249,299 6(22) ( 1,606,780 ) ( 2,034,933 ) 6(23) ( 607,796 ) ( 377,254 ) 6(7) 428,240 302,130 833,161 ( 4,858,564 ) 3,362,946 4,740,602 ( 166,361 ) 228,282 ( 625,785 ) ( 2,500,156 ) 22,119 ( 83,715 ) ( 1,228,424 ) 1,443,201 ( 1,003,668 ) ( 628,678 ) ( 1,005,660 ) 306,428 ( 86,641 ) ( 28,079 ) 5,541,498 3,548,874 ( 1,348,691 ) ( 1,115,791 ) 360,686 - 4,553,493 2,433,083

(Continued)

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FOXCONN TECHNOLOGY CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2021 AND 2020

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

CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of financial assets at fair value through profit or loss Acquisition of financial assets at fair value through other comprehensive income Proceeds from disposal of financial assets at fair value through other comprehensive Increase in financial assets at amortized cost - current Decrease in financial assets at amortized cost - current Decrease in financial assets at amortised cost - non- current Increase in financial assets at amortised cost - non- current Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Increase in net receivable/ payable on raw materials Decrease (Increase) in refundable deposits Increase in other non-current assets Interest received Dividends received Net cash flows (used in) from investing activities CASH FLOWS FROM FINANCING ACTIVITIES Increase in short-term loans Decrease in short-term loans Payments of lease liabilities Increase in other non-current liabilities Interest paid Cash dividends paid Net cash flows from (used in) 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 2021 2020 ($ 14,451 ) $ - ( 2,534,266 ) - 6(3) 416,086 - ( 12,100,754 ) - - 34,424,071 869,912 1,284,571 - ( 428,180 ) 6(29) ( 1,370,485 ) ( 455,079 ) 6(29) 768,742 582,728 91,936 ( 119,679 ) ( 2,943 ) ( 14,211 ) ( 67,544 ) 775 1,481,392 2,071,323 6(23) 607,796 377,254 ( 11,854,579 ) 37,723,573 31,111,257 16,691,281 ( 24,547,397 ) ( 16,546,516 ) ( 156,779 ) ( 149,328 ) 81,485 11,934 ( 141,728 ) ( 240,888 ) 6(18) ( 2,546,073 ) ( 3,536,213 ) 3,800,765 ( 3,769,730 ) ( 876,262 ) ( 408,591 ) ( 4,376,583 ) 35,978,335 76,101,991 40,123,656 $ 71,725,408 $ 76,101,991

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

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FOXCONN TECHNOLOGY CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 2021 AND 2020

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

1. HISTORY AND ORGANIZATION

The Company was originally known as Q-RUN Technology Co., Ltd. and established on April 26, 1990. On March 1, 2004, the Company merged with Foxconn Precision Components Co., Ltd. and was renamed as Foxconn Technology Co., Ltd. The Company and its subsidiaries (collectively referred herein as “the Group”) are primarily engaged in manufacturing, processing and sales of case, heat dissipation modules and consumer electronics products.

1. THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL STATEMENTS AND PROCEDURES FOR AUTHORIZATION

These consolidated financial statements were authorized for issuance by the Board of Directors on March 22, 2022.

1. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS (1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”)

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

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

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

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

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

the Group

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

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

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

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

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

endorsed by the FSC are as follows:
New Standards,Interpretations andAmendments	Effective Date by International Accounting StandardsBoard
Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets between an investor and its associate or joint venture’ IFRS 17, ‘Insurance contracts’ Amendment to IFRS 17, 'Initial application of IFRS 17 and IFRS 9 – comparative information' Amendments to IFRS 17, ‘Insurance contracts’ Amendments to IAS 1, ‘Classification of liabilities as current or non-current’ Amendments to IAS 1, ‘Disclosure of accounting policies’ Amendments to IAS 8, ‘Definition of accounting estimates’ Amendments to IAS 12,‘Deferred tax related to assets and liabilities arising from a single transaction’	To be determined by International Accounting Standards Board January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 January 1, 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.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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

(1) Compliance statement

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

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(2) Basis of preparation

• A. Except for the following items, the consolidated financial statements have been prepared under the historical cost convention:

• (a) Financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.

• (b) Financial assets at fair value through other comprehensive income.

• (c) Defined benefit liabilities 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 International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the FSC (collectively referred herein as the “IFRSs”) requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5.

(3) Basis of consolidation

• A. Basis for preparation of consolidated financial statements:

• (a) All subsidiaries are included in the Group’s consolidated financial statements. Subsidiaries are all entities (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.

• (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.

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B. Subsidiaries included in the consolidated financial statements:

Investor	Subsidiary	Main BusinessActivities Investment holdings in companies in Mainland China, Hong Kong and America primarily engaged in manufacturing, sale, research and development of computer thermal module and computer components Investment holdings in companies in Mainland China, Hong Kong, Singapore and America primarily engaged in manufacturing, sale, research and development of aluminum magnesium case and computer components Investment holdings in R.O.C. companies Investment holdings and reinvestment Investment holdings and reinvestment Investment holdings and reinvestment Investment holdings and reinvestment Investment holdings and reinvestment Sales, investment holdings and reinvestment	Ownership (%)	Ownership (%)	Note
			December 31,2021 100 100 100 100 100 100 100 100 100	December 31,2020 100 100 100 100 100 100 100 100 100
Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Precision Components Holding Co., Ltd. Q-RUN Holdings Ltd. Q-RUN Holdings Ltd. Q-RUN Holdings Ltd. Q-RUN Holdings Ltd. Q-RUN Holdings Ltd.	Foxconn Precision Components Holding Co., Ltd. Q-RUN Holdings Ltd. Huazhun Investment Co., Ltd. Atkinson Holdings Ltd. Q-RUN Far East Corporation World Trade Trading Ltd. High Tempo International Ltd. FTC Technology Inc. Foxconn Technology Pte. Ltd.

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Investor	Subsidiary	Main BusinessActivities Investment holdings and reinvestment Investment holdings and reinvestment Investment holdings and reinvestment Investment holdings and reinvestment Investment holdings and reinvestment Investment holdings and reinvestment Investment holdings and reinvestment Investment holdings and reinvestment Investment holdings and reinvestment Manufacturing and marketing of power plug and wall socket, micro ribbon connectors for terminals, etc. Manufacturing and marketing of computer components (computer thermal module)	Ownership (%)	Ownership (%)	Note
			December 31,2021 100 100 100 100 - 100 100 100 100 22.76 100	December 31,2020 100 100 100 100 100 100 100 100 100 22.76 100
Atkinson Holdings Ltd. Atkinson Holdings Ltd. Atkinson Holdings Ltd. Q-RUN Far East Corporation Q-RUN Far East Corporation Q-RUN Far East Corporation Q-RUN Far East Corporation Q-RUN Far East Corporation Foxconn Technology Pte. Ltd. Kenny International Ltd. Double Wealth Profits Ltd.	Kenny International Ltd. Double Wealth Profits Ltd. Precious Star International Ltd. Eastern Star Limited Foreign Technology Ltd. Topfry Industrial Ltd. Gold Glory International Ltd. New Glory Holdings Ltd. FTP Technology Inc. Fu Yu Precision Components (Kunshan) Co., Ltd. Fuzhun Precision (Shenzhen) Industry Co., Ltd.				(a)

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Investor	Subsidiary	Main Business Activities Manufacturing and marketing of computer components (computer thermal module) Manufacturing and marketing of computer components and peripherals and computer cases New alloy material, precision molds, new electronic components, portable computers and their components Manufacturing and marketing of computer components and related peripherals, computer cases and metal stamping Research, development, production and sales of aluminum alloy materials, rail vehicle components, car accessories and electronic components; manufacturing and sales of structured metal products and metal container (not including precious metal and electroplating)	Ownership (%)	Ownership (%)	Note
			December 31,2021 65 87.63 100 12.37 70	December 31,2020 65 87.63 100 12.37 70
Fuzhun Precision (Shenzhen) Industry Co., Ltd. Eastern Star Limited Eastern Star Limited Precious Star International Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd.	Champ Tech Optical (Foshan) Corporation Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Qingdao Hiyn Materials Co., Ltd.

~20~

Investor	Subsidiary	Main BusinessActivities Manufacture and sale of automobile parts; manufacture and sale of aluminum alloy parts used for automobiles and electronics Manufacturing and marketing of computer case – electronic and electrical components Manufacturing and marketing of power plug and wall socket, micro ribbon connectors for terminals, etc. Manufacturing and marketing of computer components (computer thermal module) Manufacturing and marketing of computer case – electronic and electrical components Manufacturing and marketing of computer case – electronic and electrical components Manufacturing and marketing of computer components (computer thermal module)	Ownership (%)	Ownership (%)	Note
			December 31,2021 100 100 77.24 35 50.62 49.38 100	December 31,2020 100 100 77.24 35 - 100 100
Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Topfry Industrial Ltd. Gold Glory International Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. New Glory Holdings Limited New Glory Holdings Limited	Fuzhun Precision Industry (Shenyang) Co., Ltd. Fuhuigang Industral (Shenzhen) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. Champ Tech Optical (Foshan) Corporation YanTai Fuzhun Precision Electronics Co., Ltd. YanTai Fuzhun Precision Electronics Co., Ltd. Nanning Funing Precision Electronics Co., Ltd.

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  - (a) The Group’s subsidiary, FOREIGN TECHNOLOGY Co., Ltd., completed its liquidation at the 1st quarter of 2021 and repaid the capital amount invested by the Group.

• 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

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 are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in other comprehensive income. However, nonmonetary assets and liabilities denominated in foreign currencies that are not measured at fair value are translated using the historical exchange rates at the dates of the initial transactions.

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

• B. Translation of foreign operations

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

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

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

  • iii. All resulting exchange differences are 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 the Group still retains partial interest in the former foreign associate after losing significant influence over the former foreign associate, 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 the Group still retains partial interest in the former foreign subsidiary after losing control of the former foreign subsidiary, such transactions should be accounted for as disposal of all interest in the foreign operation.

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(5) Classification of current and non-current items

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

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

• (b) Assets held mainly for trading purposes;

• (c) Assets that are expected to be realized within twelve months from the balance sheet date;

• (d) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to pay off liabilities more than twelve months after the balance sheet date.

• B. Liabilities that meet one of the following criteria are classified as current liabilities; otherwise they are classified as non-current liabilities:

• (a) Liabilities that are expected to be paid off within the normal operating cycle;

• (b) Liabilities arising mainly from trading activities;

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

• (d) Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

(6) Cash equivalents

• Cash equivalents refer to short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Time deposits and bands sold under repurchase agreement that meet the definition above and are held for the purpose of meeting short-term cash commitments in operations are classified as cash equivalents.

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

• A. Financial assets at fair value through profit or loss are financial assets that are not measured at amortized cost or fair value through other comprehensive income. Financial assets at amortized cost or fair value through other comprehensive income are designated as at fair value through profit or loss at initial recognition when they eliminate or significantly reduce a measurement or recognition inconsistency.

• B. On a regular way purchase or sale basis, financial assets at fair value through profit or loss are 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.

• D. The Group recognizes the dividend income when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Group and the amount of the dividend can be measured reliably.

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

• A. Financial assets at fair value through other comprehensive income comprise equity securities which are not held for trading, and for which the 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.

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The Group subsequently measures the financial assets at fair value:

• (a) The changes in fair value of equity investments that 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.

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

• (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.

• (10) Accounts and notes receivable

• A. Accounts and notes receivable entitle the Group a legal right to receive consideration in exchange for transferred goods or rendered services.

• B. The short-term accounts and notes receivable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

• C. The Group’s operating pattern of accounts receivable that are expected to be factored is for the purpose of receiving contract cash flow and selling, and the accounts receivable are subsequently measured at fair value, with any changes in fair value recognized in other comprehensive income.

• (11) Impairment of financial assets

• For financial assets at amortized cost, 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 process comprises raw materials, direct labour, other direct costs and related production overheads (allocated based on normal

~24~

operating capacity). It excludes borrowing costs. The item by item approach is used in applying the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and applicable variable selling expenses.

(15) Investments accounted for under 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 per cent or more of the voting power of the investee. Investments in associates are accounted for using the equity method and are initially recognized at cost.

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

• C. When changes in an associate’s equity are not recognized in 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 change in ownership interests in the associate in ‘capital surplus’ in proportion to its ownership.

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

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

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

• G. When the Group disposes its investment in an associate 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, on the same basis as would be required if the relevant assets or liabilities were disposed of. If it retains significant influence over this associate, the amounts previously recognized in other comprehensive income in relation to the associate are reclassified to profit or loss proportionately in accordance with the aforementioned approach.

• (16) Property, plant and equipment

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

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

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during the financial period in which they are incurred.

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

• D. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each financial year-end. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in estimate under IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and Errors’, from the date of the change. The estimated useful lives for buildings and structures machinery and equipment and other equipment are 3~55 years, 2~10 years and 2~10 years, respectively.

• (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 borrowing interest rate. Lease payments are comprised of fixed payments, less any lease incentives receivable. 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 following: (a) The amount of the initial measurement of lease liability;

  • (b) Any lease payments made at or before the commencement date; and

  • (c) Any initial direct costs incurred by the lessee;

  • 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.

• D. For lease modifications that decrease the scope of the lease, the lessee shall decrease the carrying amount of the right-of-use asset to reflect the partial or full termination of the lease, and recognize in profit of loss the difference between the remeasured lease liability and the change in 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 8 ~ 55 years.

• (19) Intangible assets

• A. Goodwill arises in a business combination accounted for by applying the acquisition method.

• B. Patent rights and technical skill are amortized on a straight-line basis over their estimated useful lives of 5 years.

• (20) Impairment of non-financial assets

• A. The Group assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognized for the amount by

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which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. Except for goodwill, when the circumstances or reasons for recognizing impairment loss for an asset in prior years no longer exist or diminish, the impairment loss is reversed. The increased carrying amount due to reversal should not be more than what the depreciated or amortized historical cost would have been if the impairment had not been recognized.

• B. The recoverable amounts of goodwill that have not yet been available for use are evaluated periodically. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. Impairment loss of goodwill previously recognized in profit or loss shall not be reversed in the following years.

• C. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash-generating units, or groups of cash-generating units, that is/are expected to benefit from the synergies of the business combination. Each unit or group of units to which the goodwill is allocated represents the lowest level within the entity at which the goodwill is monitored for internal management purposes. Goodwill is monitored at the operating segment level.

(21) Loans

Borrowings comprise long-term and short-term bank borrowings and other long-term and short-term loans. Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings 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 borrowings using the effective interest method.

• (22) Accounts and notes payable

• A. Accounts payable are liabilities for purchases of raw materials, goods or services and notes payable are those resulting from operating and non-operating activities.

• B. The short-term notes and accounts payable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

• (23) Financial liabilities at fair value through profit or loss

• A. Financial liabilities are classified in this category of held for trading if acquired principally for the purpose of repurchasing in the short-term. Derivatives are also 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.

• (24) Derecognition of financial liabilities

A financial liability is derecognized when the obligation specified in the contract is either discharged or 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 realize the asset and settle the liability simultaneously.

• (26) Non-hedging derivatives

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

(27) Employee benefits

• A. Short-term employee benefits

Short-term employee benefits are measured at the undiscounted amount of the benefits expected

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to be paid in respect of service rendered by employees in a period and should be recognized as expenses in that period when the employees render service.

• B. Pensions

• (a) Defined contribution plans

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

  - (b) Defined benefit plans

     - i. Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employees will receive on retirement for their services with the Group in current period or prior periods. The liability recognized in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The 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 government bonds (at the balance sheet date) of a currency and term consistent with the currency and term of the employment benefit obligations.

     - 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.

     - iii. Pension cost for the interim period is calculated on a year-to-date basis by using the pension cost rate derived from the actuarial valuation at the end of the prior financial year, adjusted for significant market fluctuations since that time and for significant curtailments, settlements, or other significant one-off events. And, the related information is disclosed accordingly.

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

  • Employees’ compensation and directors’ and supervisors’ remuneration are recognized as expenses and liabilities, provided that such recognition is required under legal 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 employees 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) 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 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. Deferred tax is provided on temporary differences arising on investments in subsidiaries

~28~

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 utilized. 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 realize 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 realize the asset and settle the liability simultaneously.

• F. The interim period income tax expense is recognized based on the estimated average annual effective income tax rate expected for the full financial year applied to the pretax income of the interim period, and the related information is disclosed accordingly.

(29) Dividends

Dividends are recorded in the Company’s financial statements in the period in which they are approved 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.

(30) Revenue recognition

• A. The Group is primarily engaged in manufacturing and sales of consumer electronics products. Sales are recognized when control of the products has transferred, being when the products are delivered to the customer, the customer has full discretion over the channel and price to sell the products, and there is no unfulfilled obligation that could affect the customer’s acceptance of the products. 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 the Group has objective evidence that all criteria for acceptance have been satisfied.

• B. Revenue from these sales is recognized based on the price specified in the contract, net of the estimated sales discounts and allowances. 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. As the time interval between the transfer of committed goods or service and the payment of customer does not exceed one year, the Group does not adjust the transaction price to reflect the time value of money.

• C. A receivable is 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.

• (31) Government grants

Government grants are recognized at their fair value only when there is reasonable assurance that the Group will comply with any conditions attached to the grants and the grants will be received. Government grants are recognized in profit or loss on a systematic basis over the periods in which the Group recognizes expenses for the related costs for which the grants are intended to compensate.

• (32) Operating segments

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

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performance of the operating segments.

5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF ASSUMPTION UNCERTAINTY

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

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

• A. Revenue recognition

The Group provides integrated electronics manufacturing services to meet the following criteria by judgment, and recognizes revenue on a gross basis:

  - (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

• 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, 2021, information on the carrying amount of inventories is provided in Note6(6).

1. DETAILS OF SIGNIFICANT ACCOUNTS

(1) Cash and cash equivalents

TAILS OF SIGNIFICANT ACCOUNTS Cash and cash equivalents
Cash on hand and revolving funds Checking accounts and demand deposits Cash equivalents Time deposits Repurchase Agreement Bond	December31,2021 299 $ 61,901,781 9,823,328 - 71,725,408 $	December31,2020
		514 $ 70,338,643 5,721,834 41,000
		76,101,991 $

• A. The Group associates 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. Time deposits with maturity in excess of three months and restricted time deposits on December 31, 2021 and 2020 have been listed under “financial assets at amortized cost - current” and “financial assets at amortized cost - non-current”..

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

Financial assets or liabilities at fair value through	profit or loss
Assets Current items: Financial assets mandatorily measured at fair value through profit or loss Derivatives Non-current items: Financial assets mandatorily measured at fair value through profit or loss Fund Debt instrument Liabilities Current items: Financial liabilities mandatorily measured at fair value through profit or loss Derivatives	December31,2021 22,357 $ 272,437 $ 14,451 286,888 $ 6,015 $	December31,2020
		63,079 $ 524,752 $ -
		524,752 $
		214,420 $

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

hrough profit or loss are listed below:
		Years ended December		31,
		2021		2020
Financial assets and liabilities mandatorily
measured at fair value through profit or
loss
Derivatives	($	14,388)	($	323,616)
Fund	(	251,690)		25,357
	($	266,078)	($	298,259)

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

		December 31, 2021
	Contract	amount
Derivativeinstruments	(Nominal Principal inthousands)		Contract period
Current items:
Forward exchange contracts	USD (SELL)	172,000	2021/10~2022/4
	CNH (BUY)	1,104,723

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		December31,2020
	Contract	amount
Derivativeinstruments	(Nominal Principal in thousands)		Contract period
Current items:
Forward exchange contracts	USD (SELL)	105,000	2020/10~2021/05
	CNH (BUY)	703,380
Foreign exchange contracts	TWD (SELL)	4,526,106	2020/03~2021/03
	USD (BUY)	152,000

• (a) Forward exchange contracts

The Group signed forward exchange contracts to hedge exchange rate risks arising from the activities listed below:

• i. Business activity: The payables due from exporting materials and supplies as well as receivables from exports.

• ii. Investment activity: The payment due from importing machinery and equipment.

• iii. Financial activity: Assets and liabilities (financing) resulted from long-term or short-term borrowings.

• (b) Foreign exchange contracts

The Group entered into foreign exchange contracts to satisfy capital requirement. The principal in two currencies are swapped using the same exchange rate at the beginning and the end of the period to reduce exchange rate risk.

• C. The counterparties of derivative instruments held by the Group are all banks with good credit quality or financial institutions with investment grade credit ratings that are above A.

• D. The Group has no financial assets at fair value through profit or loss pledged to others.

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

Items Non-current items: Equity instruments	December31,2021 38,345,819 $	December31,2020
		36,601,116 $

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

• B. The Group sold certain common stock of VIZIO HOLDING CORP. that it held amounting to US$ 14,591 thousand for the year ended December 31, 2021. The gains (losses) on disposal amounting to $416,086 was transferred from other comprehensive income to retained earnings directly.

• C. The Board of Directors of the Group resolved to subscribe 27,500 thousand common shares of EIRGENIX, INC. through private placement at $91.5 (in dollars) per share on September 22, 2021. The investment amount was $2,516,250 and the effective date was on October 15, 2021.

• D. The Group has no financial assets at fair value through other comprehensive income pledged to others.

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

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		Years ended	December31,
		2021	2020
Fair value change recognized in other
comprehensive income (loss)	$	527,662	2,262,646 $
Dividend income recognized in profit
or loss	$	607,796	377,254 $
Please refer to table 2 for information on financial assets at fair value through other comprehensive
income.

(4) Financial assets at amortized cost

income. Financial assets at amortized cost
Items Current items: Time deposits with maturity in excess of three months Pledged time deposits Non-current items: Time deposits with maturity in excess of one year Bank debentures-trust fund	December31,2021 11,957,760 $ 18,080 11,975,840 $ - $ 2,177,032 2,177,032 $	December31,2020 - $ 17,647
		17,647 $
		435,455 $ 2,612,760
		3,048,215 $

• A. Please refer to Note 6(22) for information on recognized gains and losses on financial assets at amortized cost.

• B. In March 2018 and December 2017, the Group invested in the trust fund named Guangdong Finance Trust - Peng Yun Tian Hua Collection Fund Trust for RMB 500 million and RMB 1 billion, respectively. The fund was mainly created for the investment in Guangzhou Guangyin Nanyue Intelligent Technology Industrial Investment Partnership. This investment is included in “financial assets at amortized cost-non-current.”

As of December 31, 2021, the Group has received cumulative return in the amount of RMB 1000 million in accordance with the investment agreement.

• C. Details of the Group’s financial assets at amortized cost pledged to others as collateral as of December 31, 2021, and 2020 are provided in Note 8.

• D. All of the Group's investments have high credit quality.

(5) Notes and accounts receivable

Notes and accounts receivable
			December31,2021			December31,2020
Notes receivable		$	146,762		$	19,425
Accounts receivable			17,254,521			18,248,750
			17,401,283			18,268,175
Less: Allowance for uncollectible accounts	(		5,819)	(		6,052)
		$	17,395,464		$	18,262,123

• A. The Group does not hold any collateral as security.

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

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(6) Inventories

Inventories
			December31,2021			December31,2020
Raw materials		$	390,913		$	620,292
Work in process			531,971			403,534
Finished goods			4,741,256			4,034,451
			5,664,140			5,058,277
Less: Allowance for inventory
obsolescence and market
price decline	(		74,012)	(		62,699)
		$	5,590,128		$	4,995,578

The cost of inventories recognized as expense for the period:

			Years endedDecember	Years endedDecember	Years endedDecember	31,
			2021			2020
Cost of inventories sold		$	97,046,104		$	98,627,821
(Gain) loss on inventory obsolescence and
market price decline			10,709	(		137,871)
Revenue from sale of scraps	(		233,318)	(		169,924)
		$	96,823,495		$	98,320,026

Due to the sale of some of the inventories with net realizable value lower than cost in 2020, the amount of provision for inventory valuation losses was reduced.

(7) Investments accounted for using equity method

Investees			December31,2021			December31,2020
At January 1		$	5,259,090		$	5,791,082
Share of loss of investments accounted for using equity method	(		428,240)	(		302,130)
Change in capital surplus			11,440			187
Change in other equity interest (Note 6(19))	(		112,006)	(		230,049)
At December 31		$	4,730,284		$	5,259,090
			December31,2021			December31,2020
Associates		$	4,730,284		$	5,259,090

A. The Group’s share of the operating results in all individually immaterial associates are summarized below:

below:
		Years ended December31,
		2021		2020
Loss for the period from continuing operations	($	428,240)	($	302,130)
Other comprehensive loss, net of tax	(	112,006)	(	230,049)
Total comprehensive loss for the year	($	540,246)	($	532,179)

B. The Group’s investment, IDG Energy Investment Limited, has quoted market prices. As of

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December 31, 2021 and 2020, the fair value was $6,693,237 and $5,454,405, respectively.

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(8) Property, plant and equipment

2021

roperty, plant and equipment			2021
At January 1 Cost Accumulated depreciation Opening net book amount as at January 1 Additions Reclassifications Transfer Disposals Depreciation Net exchange differences Closing net book amount as at December 31 At December 31 Cost Accumulated depreciation	Land 51,850 $ - 51,850 $ 51,850 $ - - - - - - 51,850 $ 51,850 $ - 51,850 $	Buildings and structures	Machinery and equipment Others 14,826,361 $ 4,253,425 $ 13,561,396) ( 3,640,008) ( 1,264,965 $ 613,417 $ 1,264,965 $ 613,417 $ 1,073,157 176,822 79,126 1,889) ( - - 379,212) ( 54,470) ( 484,978) ( 166,703) ( 4,976 1,018 1,558,034 $ 568,195 $ 12,819,001 $ 3,256,068 $ 11,260,967) ( 2,687,873) ( 1,558,034 $ 568,195 $
		8,355,160 $ 5,713,926) ( 2,641,234 $ 2,641,234 $ 70,890 1,350 108,959) ( 84,615) ( 361,022) ( 1,402) ( 2,157,476 $ 7,655,014 $ 5,497,538) ( 2,157,476 $

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2020

			2020
At January 1 Cost Accumulated depreciation Opening net book amount as at January 1 Additions Reclassifications Transfer Disposals Depreciation Net exchange differences Closing net book amount as at December 31 At December 31 Cost Accumulated depreciation	Land 51,850 $ - 51,850 $ 51,850 $ - - - - - - 51,850 $ 51,850 $ - 51,850 $	Buildings and structures	Machinery and equipment Others 18,457,368 $ 4,391,845 $ 16,834,642) ( 3,694,624) ( 1,622,726 $ 697,221 $ 1,622,726 $ 697,221 $ 304,718 126,976 6,448 417 - - 98,580) ( 8,733) ( 582,718) ( 207,707) ( 12,371 5,243 1,264,965 $ 613,417 $ 14,826,361 $ 4,253,425 $ 13,561,396) ( 3,640,008) ( 1,264,965 $ 613,417 $
		8,455,120 $ 5,362,555) ( 3,092,565 $ 3,092,565 $ 36,923 208,653 345,459) ( - 360,873) ( 9,425 2,641,234 $ 8,355,160 $ 5,713,926) ( 2,641,234 $

The significant components of buildings and structures include main plants and leasehold improvements, which are depreciated over 20~55 and 3~11 years, respectively.

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(9) Leasing arrangements - lessee

• A. The Group leases various assets including land use right, buildings and structures as well as other equipment. Except for the rental period of land use right which is 50 years, rental contracts are typically made for periods of 1 to 5 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions.

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

Land use right Buildings and structures Others Land use right Buildings and structures Others	December31,2021 December31,2020 Carrying amount Carrying amount 785,881 $ 808,260 $ 390,559 302,662 12,966 13,855 1,189,406 $ 1,124,777 $ Years ended December 31,	December31,2020 Carrying amount 808,260 $ 302,662 13,855 1,124,777 $
	2021 Depreciation expense 22,234 $ 176,086 9,963 208,283 $	2020
		Depreciation expense
		21,914 $ 144,467 8,531
		174,912 $

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

Items affecting profit or loss Interest expense on lease liabilities Expense on short-term lease contracts Expense on leases of low-value assets	2021 2020 38,869 $ 19,291 $ 88,429 131,035 2,664 5,648 Years ended December31,	2021 2020 38,869 $ 19,291 $ 88,429 131,035 2,664 5,648 Years ended December31,
		19,291 $ 131,035 5,648

• D. For the years ended December 31, 2021 and 2020, the Group’s total right-of-use assets for increases amount to $269,209 and $5,071 respectively.

• E. For the years ended December 31, 2021 and 2020, the Group’s total cash outflow for leases amount to $286,741 and $305,302 respectively.

• F. Information about the right-of-use assets that was pledged to others as collateral is provided in Note 8.

• (10) Leasing arrangements - lessor

• A. The Group leases various assets including buildings. Rental contracts are typically made for periods of 1 and 5 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions.

• B. For the years ended December 31, 2021 and 2020, the Group recognized rent income in the amount of $262,761 and $267,727, respectively.

• C. The maturity analysis of the lease payments under the operating leases is as follows:

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December31,2021 2022 146,002 $ 2021 2023 93,350 2022 2024 7,640 2023 2025 5,980 2024 2026 1,031 2025 254,003 $	December31,2020 90,806 $ 62,087 8,753 3,540 1,286
	166,472 $

The rent income recognized by the Group is measured based on the area actually used by the lessee. The lease receivables listed above are calculated based on the area actually used by the lessee at the balance sheet date.

(11) Investment property

alance sheet date. Investment property
At January 1 Cost Accumulated depreciation and impairment Opening net book amount as at January 1 Transfer in Depreciation expense Net exchange differences Closing net book amount as at December 31 At December 31 Cost Accumulated depreciation and impairment		2021
	Land $ 95,910 - 95,910 $ $ 95,910 - - - 95,910 $ $ 95,910 - 95,910 $

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At January 1 Cost Accumulated depreciation and impairment Opening net book amount as at January 1 Transfer in Depreciation expense Net exchange differences Closing net book amount as at December 31 At December 31 Cost Accumulated depreciation and impairment	Land Buildings and structures Total $ 95,910 1,989,417 $ 2,085,327 $ - 1,053,222) ( 1,053,222) ( 95,910 $ 936,195 $ 1,032,105 $ $ 95,910 $ 936,195 1,032,105 $ - 345,459 345,459 - 112,955) ( 112,955) ( - 14,436 14,436 95,910 $ 1,183,135 $ 1,279,045 $ $ 95,910 2,462,318 $ 2,558,228 $ - 1,279,183) ( 1,279,183) ( 95,910 $ 1,183,135 $ 1,279,045 $ 2020

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	Years endedDecember31,
	2021 191,382 $ 139,972 $	2020
		161,752 $
		112,955 $

B. The fair value of the investment property held by the Group as of December 31, 2021 and 2020 was 2,425,451 and $2,219,072 , respectively. Valuations were made using the income approach which is categorized within Level 3 in the fair value hierarchy.

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(12) Intangible assets

Intangible assets
						2021
		Patent rights and
			technicalskills			Goodwill			Total
January 1
Cost		$	449,703		$	1,146,402		$	1,596,105
Accumulated amortization	(		114,818)			-	(		114,818)
		$	334,885		$	1,146,402		$	1,481,287
At January 1		$	334,885		$	1,146,402		$	1,481,287
Amortization	(		114,549)			-	(		114,549)
Net exchange differences	(		293)	(		132)	(		425)
December 31		$	220,043		$	1,146,270		$	1,366,313
At December 31
Cost		$	334,847		$	1,146,270		$	1,481,117
Accumulated amortization	(		114,804)			-	(		114,804)
		$	220,043		$	1,146,270		$	1,366,313
						2020
		Patent rights and
			technicalskills			Goodwill			Total
January 1
Cost		$	567,563		$	1,133,371		$	1,700,934
Accumulated amortization	(		122,972)			-	(		122,972)
		$	444,591		$	1,133,371		$	1,577,962
At January 1		$	444,591		$	1,133,371		$	1,577,962
Amortization	(		118,095)			-	(		118,095)
Net exchange differences			8,389			13,031			21,420
December 31		$	334,885		$	1,146,402		$	1,481,287
At December 31
Cost		$	449,703		$	1,146,402		$	1,596,105
Accumulated amortization	(		114,818)			-	(		114,818)
		$	334,885		$	1,146,402		$	1,481,287

• A. As of December 31, 2021 and 2020, goodwill allocated to the cash-generating units of production and sales of mechanical components’ operating segments amounted to $1,146,270 and $1,146,402, respectively.

• B. The Group evaluated the impairment of recoverable amount of the goodwill at each reporting date and used the value-in-use calculation as basis for recoverable amount. These estimates are based on future cash flow projections covering a five-year period. The impairment of goodwill is not recognised based on the result of periodic assessment.

• C. The recoverable amount of all cash-generating units calculated using the value-in-use exceeded their carrying amount, so goodwill was not impaired. The key assumptions used for value-in-use calculations are as follows:

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	Years ended	December31,
China	2021	2020
Gross margin	15.71%	14.65%
Growth rate	2%	2%
Discount rate	19.65%	14.29%

Management determined budgeted gross margin based on past performance and their expectations of market development. The weighted average growth rates used are consistent with the projection included in industry reports. The discount rates used were pre-tax and reflected specific risks relating to the relevant operating segments.

(13) Short-term loans

specific risks relating to the Short-term loans	relevant operating segments.
Type of loans Bank loans Unsecured loans Other short-term loans Type of loans Bank loans Unsecured loans Other short-term loans	December31,2021 Interestraterange 22,413,210 $ 0.41%~0.77% 95,790 4.35% 22,509,000 $ December 31, 2020 Interest rate range 15,850,580 $ 0.48%~0.97% 95,801 4.35% 15,946,381 $	Collateral None " Collateral
		None "

A. Information on abovementioned collateral is provided in Note 8.

B. The Group has signed an agreement to offset financial assets and liabilities with financial institutions. Details of the offset as of December 31, 2020 are as follows:

	December31,2020
Gross amount of recognized financial liabilities 2,795,447 $	Gross amount of recognized financial assets in the balance sheet 2,795,447 $	Net amount of financial liabilities presented in the balance sheet
		- $

The Group had no additions to offset financial assets and liabilities at December 31, 2021.

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(14) Other payables

Payable for purchases made by parties on behalf of others Awards and salaries payable Payable on module expense Employees’ compensation payable Consumption goods expense payable Others	December31,2021 December31,2020 3,236,021 $ 2,025,556 $ 1,773,809 1,979,078 1,163,722 1,297,678 1,063,452 1,296,708 988,488 1,090,445 2,680,751 3,162,278 10,906,243 $ 10,851,743 $

(15) Pensions

A. Defined benefit plans

(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 and its domestic subsidiaries contribute monthly an amount equal to 2% of the employees’ monthly salaries and wages to the retirement fund deposited with Bank of Taiwan, the trustee, under the name of the independent retirement fund committee.

• (b) The amounts recognized in the balance sheet are as follows (shown as ‘other non-current liabilities’):

liabilities’):
	December	31,2021	December	31,2020
Present value of defined benefit obligations	$	(74,402)	$	(67,933)
Fair value of plan assets		34,137		34,299
Net defined benefit liability	($	40,265)	($	33,634)

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

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		Present value of	Present value of
			defined benefit			Fair value of		Net defined
			obligations			plan assets		benefit liability
2021
Balance at January 1	($		67,933)		$	34,299	($	33,634)
Past service cost	(		972)			-	(	972)
Interest income	(		238)			123	(	115)
	(		69,143)			34,422	(	34,721)
Remeasurements
Return on plan assets (Note)			-			486		486
Change in demographic assumptions	(		4,072)			-	(	4,072)
Change in financial assumptions			2,634			-		2,634
Experience adjustments	(		6,005)			-	(	6,005)
	(		7,443)			486	(	6,957)
Pension fund contribution			-			1,413		1,413
Paid pension			2,184	(		2,184)		-
			2,184	(		771)		1,413
Balance at December 31	($		74,402)		$	34,137	($	40,265)
		Present value of
			defined benefit			Fair value of		Net defined
			obligations			plan assets		benefit liability
2020
Balance at January 1	($		57,744)		$	39,056	($	18,688)
Past service cost	(		528)			-	(	528)
Interest income	(		462)			319	(	143)
	(		58,734)			39,375	(	19,359)
Remeasurements
Return on plan assets (Note)			-			1,266		1,266
Change in demographic assumptions	(		567)			-	(	567)
Change in financial assumptions	(		2,833)			-	(	2,833)
Experience adjustments	(		13,650)			-	(	13,650)
	(		17,050)			1,266	(	15,784)
Pension fund contribution			-			1,509		1,509
Paid pension			7,851	(		7,851)		-
			7,851	(		6,342)		1,509
Balance at December 31	($		67,933)		$	34,299	($	33,634)

Note: The amount included in interest income or expense is excluded.

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• (d) The Bank of Taiwan was commissioned to manage the Fund of the Company’s defined benefit pension plan in accordance with the Fund’s annual investment and utilization plan and the “Regulations for Revenues, Expenditures, Safeguard and Utilization of the Labor Retirement Fund” (Article 6: The scope of utilization for the Fund includes deposit in domestic or foreign financial institutions, investment in domestic or foreign listed, over-the -counter, or private placement equity securities, investment in domestic or foreign real estate securitization products, etc.). With regard to the utilization of the Fund, its minimum earnings in the annual distributions on the final financial statements shall be no less than the earnings attainable from the amounts accrued from 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 approval by the Regulator. The Company has no right to participate in managing and operating that fund and hence 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, 2021 and 2020 is given in the Annual Labor Retirement Fund Utilization Report announced by the government.

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

Discount rate Future salary increases	2021 2020 0.75% 0.35% 2.00% 2.00% Years endedDecember31,	2021 2020 0.75% 0.35% 2.00% 2.00% Years endedDecember31,	2021 2020 0.75% 0.35% 2.00% 2.00% Years endedDecember31,
			2.00%

Assumptions regarding future mortality experience are set based on actuarial advice in accordance with published statistics and experience in each territory. Because the main actuarial assumption changed, the present value of defined benefit obligation is affected. The analysis was as follows:

December 31,2021 Effect on present value of defined benefit obligation December 31,2020 Effect on present value of defined benefit obligation	Increase Decrease Increase Decrease 0.25% 0.25% 0.25% 0.25% 1,680 $ 1,733) ($ 1,666) ($ 1,623 $ 1,603 $ 1,657) ($ 1,585) ($ 1,542 $ Discountrate Future salary increase	Future salary increase

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

(f) Expected contributions to the defined benefit pension plans of the Group for the year ending December 31, 2022 are $1,800

B. Defined contribution plans

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

~45~

employment.

• (b) The subsidiaries in mainland China have defined contribution pension plans and the Group contributes an amount monthly based on 14%~20% of employees’ monthly salaries and wages to an independent fund administered by a government agency. The plan is administered by the government of mainland China. Other than the monthly contributions, the Group does not have further pension liabilities.

• (c) The pension costs under the defined contribution pension plans of the Group for the years ended December 31, 2021 and 2020 were $424,628 and $392,218, respectively. Due to the impact of the Covid-19 pandemic on China in 2020, the Chinese government has reduced the pension contributions by half from February 2021 for a duration of 3 months.

• (16) Share capital

As of December 31, 2021, the Company’s authorized capital was $20,000,000 (including subscription warrant or 50 million shares reserved for convertible bonds issued by the Company), and the paid-in capital was $14,144,852, consisting of 1,414,485 thousand ordinary shares with a par value of $10 (in dollars) per share.

• (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 Law requires that the amount of capital surplus to be capitalized mentioned above should not exceed 10% of the paid-in capital each year. Capital surplus should not be used to cover accumulated deficit unless the legal reserve is insufficient.

(18) Retained earnings

• A. In accordance with the Company’s Articles of Incorporation, current year’s earnings must be

• distributed in the following order:

• (a) Covering accumulated deficit;

• (b) Setting aside as legal reserve equal to 10% of current year’s net income after tax and distribution pursuant to clause (A);

• (c) Setting aside a special reserve in accordance with applicable legal and regulatory requirements.

The remaining earnings along with the unappropriated earnings at the beginning of the period are considered as accumulated distributable earnings. In accordance with the dividend policy, the proposal of earnings appropriation is prepared by the Board of Directors and resolved by the shareholders.

The Board of Directors is authorized to appropriate dividends, bonuses, capital surplus, or legal reserve either entirely or partially in cash, with at least two-thirds of the members of the Board of Directors in attendance at a board meeting, and approved by more than half of the directors present. The above appropriation does not require approval by the shareholders.

The Company is at the growing stage. The Company’s stock dividend policy shall consider the Company’s current and future investment environment, capital needs, local and foreign competition situation and capital budget, along with shareholders’ profit and the Company’s long-term financial plans. The shareholders’ dividends are appropriated based on accumulated distributable earnings, which shall not be lower than 15% of the distributable earnings for the period and the cash dividends shall not be less than 10% of the shareholders’ dividends.

• B. According to related regulations, 10% of the balance of earnings after tax less the accumulated loss of prior years should be set aside as legal reserve, until such legal reserve amount reaches the total authorized capital. 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

~46~

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.

• C. In accordance with the regulations, the Company shall set aside special reserve from the debit balance on other equity items at the balance sheet date before distributing earnings. When debit balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings.

• D. The appropriations of earnings for 2020 and 2019 had been resolved at the stockholders’ meeting on July 23, 2021 and June 23, 2020, respectively. Details are summarized below:

Legal reserve Special reserve Cash dividends	Dividends per Dividends per Amount share (indollars) Amount share (in dollars) 470,572 $ 712,980 $ - 46,492) ( 2,546,073 1.8 $ 3,536,213 2.5 $ 3,016,645 $ 4,202,701 $ 2020 2019
	Amount 470,572 $ - 2,546,073 3,016,645 $

• E. The appropriations of earnings for 2020 as approved at the Board of Directors’ meeting as of March 30, 2021 is as follows:

arch 30, 2021 is as follows:
Legal reserve Cash dividends	Years ended December 31, 2021
	Dividends per Amount share (in dollars) 489,943 $ 2,404,625 1.7 $ 2,894,568 $

The information on distribution of earnings will be posted in the “Market Observation Post System” of the TWSE.

~47~

2021

(19) Other equity items

Other equity items					2021
			Unrealized gain
			(loss) on financial
		assets at fair value
			through other		Currency
			comprehensive		translation
			income		adjustments			Total
At January 1		$	15,172,642	($	7,862,833)		$	7,309,809
Revaluation of fair value			527,662		-			527,662
Sale transferred to
retained earnings	(		416,086)		-	(		416,086)
Currency translation
differences:
- Group			-	(	1,534,488)	(		1,534,488)
- Associates			-	(	112,006)	(		112,006)
At December 31		$	15,284,218	($	9,509,327)		$	5,774,891
					2020
			Unrealized gain
			(loss) on financial
		assets at fair value
			through other		Currency
			comprehensive		translation
			income		adjustments			Total
At January 1	$		12,909,996	($	6,126,569)	$		6,783,427
Revaluation of fair value			2,262,646		-			2,262,646
Currency translation
differences:
- Group			-	(	1,506,215)	(		1,506,215)
- Associates			-	(	230,049)	(		230,049)
At December 31	$		15,172,642	($	7,862,833)	$		7,309,809
Non-controlling interests
					YearendedDecember31,
					2021			2020
At January 1				($	46,742)	($		13,815)
Shares attributable to non-controlling interests:
Loss for the period				(	74,270)	(		32,220)
Currency translation differences				(	160)	(		707)
At December 31				($	121,172)	($		46,742)

(20) Non-controlling interests

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(21) Operating revenue

Revenue from contracts with customers

	Year ended	December31,	December31,
	2021		2020
$	104,082,031	$	104,789,599

The Group derives revenue from the transfer of goods and services at a point in time in the following categories:

Year ended December 31, 2021 Electronic Production and products sales of mechanical trading services components Others Total Revenue from contracts with customers $ 80,584,937 $ 23,294,718 $ 202,376 $ 104,082,031 Year ended December 31, 2020 Electronic Production and products sales of mechanical trading services components Others Total Revenue from contracts with customers $ 77,513,692 $ 27,119,548 $ 156,359 $ 104,789,599

(22) Interest income

Interest income
Interest income from bank deposits Interest income from capital guarantee financial products	2021 2020 1,330,064 $ 1,406,517 $ 276,716 628,416 1,606,780 $ 2,034,933 $ YearendedDecember31,
		1,406,517 $ 628,416
		2,034,933 $

(23) Other income

Other income
Dividend income Rental income Government grants revenue Others	YearendedDecember31,
	2021 607,796 $ 262,761 146,971 233,057 1,250,585 $	2020
		377,254 $ 267,727 651,201 140,470
		1,436,652 $

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(24) Other gains and loss

Other gains and loss
			YearendedDecember31,
			2021			2020
Net currency exchange gains		$	120,240		$	319,422
Gains on disposal of investments			-			11,693
Gains on disposal of property, plant and equipment through profit or loss			85,378			238,298
Gains on financial assets (liabilities) at fair value through profit or loss	(		266,078)	(		298,259)
Others	(		209,209)	(		373,965)
	($		269,669)	($		102,811)

(25) Expenses by nature

Expenses by nature
Employee benefit expense Employee benefit expense Depreciation Amortization Wages and salaries Labor and health insurance fees Pension costs Other personnel expenses	YearendedDecember31,
	2021 2020 6,810,979 $ 7,432,771 $ 1,360,958 1,439,165 114,549 118,095 8,286,486 $ 8,990,031 $ Years endedDecember31,	2020
		7,432,771 $ 1,439,165 118,095
		8,990,031 $
	2021 2020 5,525,192 $ 6,172,129 $ 254,278 269,713 425,715 392,889 605,794 598,040 6,810,979 $ 7,432,771 $

(26) Employee benefit expense

• A. According to the Company’s Articles of Incorporation, if the Company accrues profit (referring to profit before tax prior to deducting the appropriation of employees’ compensation and directors’ remuneration), 4%~6% should be appropriated as employees’ compensation

• B. For the years ended December 31, 2021 and 2020, employees’ compensation was accrued at $215,257 and $223,876, respectively. The aforementioned amounts were recognized in salary expenses. For the years ended December 31, 2021 and 2020, the employees’ compensation was estimated and accrued based on 4% and 6% of profit of current year distributable as of the end of reporting period, respectively.

• C. Employees’ compensation for 2021 and 2020 as resolved by the Board of Directors were in agreement with those amounts recognized in the 2021 and 2020 financial statements. In 2021 and 2020, the employees’ compensation was distributed in the form of cash amounting to $215,257 and $223,876, respectively.

• D. Information about employees’ compensation of the Company as resolved by the Board of Directors will be posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

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(27) Income tax

A. Components of income tax expense:

ome tax Components of income tax expense:
				YearendedDecember31,
				2021				2020
Current tax:
Current tax on profits for the period		$		1,396,731		$		917,152
Tax on undistributed surplus earnings				84,454				142,094
Prior year income tax overestimation	(			177,153)	(			184,849)
Total current tax				1,304,032				874,397
Deferred tax:
Origination and reversal of temporary
differences	(			112,421)	(			124,750)
Income tax expense		$		1,191,611		$		749,647
Reconciliation between income tax expense and accounting profit:
				Year ended December 31,
				2021				2020
Tax calculated based on profit before tax and			$	1,710,528			$	1,395,713
statutory tax rate (Note)
Exempt income according to tax law	(			426,218)	(			603,311)
Additional tax on undistributed earnings				84,454				142,094
Prior year income tax overestimation	(			177,153)	(			184,849)
Income tax expenses				1,191,611				749,647
Origination and reversal of temporary differences				112,421				124,750
Prior year income tax overestimation				177,153				184,849
Prepaid income tax	(			529,338)	(			323,418)
Prior year income tax payable				49,855				162,382
Net exchange differences				16				3,224
Current income tax liabilities			$	1,001,718			$	901,434

B. Reconciliation between income tax expense and accounting profit:

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:

~51~

							2021
						Recognized
				Recognized			in other			Net
					in profit	comprehensive				exchange
			January1		or loss		income		differences		December31
Temporary
differences:
Deferred tax
assets:
Reserve for		$	3,146	$	-	$	-		$	-		$	3,146
inventory
obsolescence
and market
price decline
Permanent loss
on market
value decline
of long-term
equity
investments			16,222		-		-			-			16,222
Differences in
useful lives of
property, plant
and equipment			490,959		22,621		-	(		10)			513,570
Unused
compensated
absences for
employees			10,354		170		-	(		2)			10,522
Net investment
income or loss
accounted for using
equity method			-		240,354		-			537			240,891
Unrealized
valuation loss
on financial
instruments			-		68,205		-			152			68,357
Others			50,965		25,963		1,391			155			78,474
		$	571,646	$	357,313	$	1,391		$	832		$	931,182
Deferred tax
liabilities:
Foreign
investment
income using
equity method	($		346,077)	($	341,210)	$	-		$	-	($		687,287)
Unrealized
exchange gain	(		62,875)		62,875		-			-			-
Others	(		165,552)		33,443		-	(		2,904)	(		135,013)
	($		574,504)	($	244,892)	$	-	($		2,904)	($		822,300)

~52~

Recognized in profit January1 or loss Temporary differences: Deferred tax assets: Reserve for 3,146 $ - $ inventory obsolescence and market price decline Permanent loss on market value decline of long-term equity investments 16,222 - Differences in useful lives of property, plant and equipment 485,594 215) ( Unused compensated absences for employees 15,764 5,442) ( Others 28,576 19,193 549,302 $ 13,536 $ Deferred tax liabilities: Foreign investment income using equity method 442,657) ($ 96,580 $ Unrealized exchange gain 41,018) ( 21,857) ( Unrealized valuation gain on financial instruments - - Others 200,312) ( 36,491 683,987) ($ 111,214 $			2020

~53~

• D. The Company did not recognize taxable temporary differences associated with investment in subsidiaries as deferred tax liabilities. As of December 31, 2021 and 2020, the temporary differences unrecognized as deferred tax liabilities were $88,220,140 and $97,587,869, respectively. Above mentioned taxable temporary differences arose from the differences between the estimated carrying amounts of long-term investments in foreign subsidiaries and tax payable. The Company will not dispose the subsidiaries in the foreseeable future nor remit back the earnings, and accordingly, deferred tax liabilities were not recognized.

• E. The Company’s income tax returns through 2019 have been assessed and approved by the Tax Authority, in addition have not been approved for 2018.

(28) 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 Employees’ compensation Shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares	Weighted average number of ordinary Earnings Amount shares outstanding per share aftertax (sharesinthousands) (indollars) 4,488,906 $ 1,414,485 3.17 $ 4,488,906 $ - 4,053 4,488,906 $ 1,418,538 3.16 $ Year ended December31,2021
		3.17 $
		3.16 $

~54~

(29)

Supplemental cash flow information Investing activities with partial cash payments: Weighted average number of ordinary Earnings Amount shares outstanding per share aftertax (sharesinthousands) (indollars) Basic earnings per share Profit attributable to ordinary shareholders of the parent 4,718,343 $ 1,414,485 3.34 $ Diluted earnings per share Profit attributable to ordinary shareholders of the parent 4,718,343 $ Assumed conversion of all dilutive potential ordinary shares Employees’ compensation - 6,004 Shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares 4,718,343 $ 1,420,489 3.32 $ Year ended December31,2020 2021 2020 Purchase of property, plant and equipment 1,373,862 $ 590,825 $ Add: Opening balance of payable on equipment 190,814 55,068 Less: Ending balance of payable on equipment 194,191) ( 190,814) ( Cash paid during the year 1,370,485 $ 455,079 $ YearendedDecember31, 2021 2020 Disposal of property, plant and equipment 743,397 $ 345,611 $ Add: Opening balance of receivable on equipment 27,520 264,637 Less: Ending balance of receivable on equipment 2,175) ( 27,520) ( Cash received during the year 768,742 $ 582,728 $ YearendedDecember31,

~55~

(30) Changes in liabilities from financing activities

	(30)Changes in liabilities from financing activities	(30)Changes in liabilities from financing activities	(30)Changes in liabilities from financing activities	(30)Changes in liabilities from financing activities	(30)Changes in liabilities from financing activities	(30)Changes in liabilities from financing activities
7.	RELATED PARTY TRANSACTIONS (1)Names of related parties and relationship Total Short-term Lease liabilities from 2021 loans liabilities financing activities At January 1 15,946,381 $ 330,922 $ 16,277,303 $ Changes in cash flows from financing activities 6,563,860 195,648) ( 6,368,212 Amortization of interest expense - 38,869 38,869 Additions - 269,209 269,209 Impact of changes in foreign exchange rate 1,241) ( 12,328 11,087 At December 31 22,509,000 $ 455,680 $ 22,964,680 $ Total Short-term Lease liabilities from 2020 loans liabilities financing activities At January 1 15,765,436 $ 472,199 $ 16,237,635 $ Changes in cash flows from financing activities 144,765 168,619) ( 23,854) ( Amortization of interest expense - 19,291 19,291 Additions - 5,071 5,071 Impact of changes in foreign exchange rate 36,180 2,980 39,160 At December 31 15,946,381 $ 330,922 $ 16,277,303 $ Names of related parties Relationship withthe Group Hon Hai Precision Industry Co., Ltd. and Subsidiaries Entities with significant (Hon Hai and Subsidiaries) influence to the Group Foxconn Precision Electronics (Taiyuan) Co., Ltd. 〞 Pan-International Industrial Corporation and Subsidiaries Other related party Eson Precision Ind. Co., Ltd. and Subsidiaries 〞 Sharp Corporation and Subsidiaries 〞 Innolux Corporation 〞 CyberTAN Technology Inc. and Subsidiaries 〞 General Interface Solution Holding Limited and Subsidiaries 〞 Ennoconn Corporation and Subsidiaries 〞 Fuyao Precision Component (Kunshan) Co., Ltd. 〞 SIO International Holdings Limited Taiwan Branch 〞 Hebi Gengde Electronics Co., Ltd. 〞
				22,509,000 $
				Short-term loans
				15,765,436 $ 144,765 - - 36,180
				15,946,381 $
	(1)
			Hon Hai Precision Industry Co., Ltd. and Subsidiaries (Hon Hai and Subsidiaries) Foxconn Precision Electronics (Taiyuan) Co., Ltd. Pan-International Industrial Corporation and Subsidiaries Eson Precision Ind. Co., Ltd. and Subsidiaries Sharp Corporation and Subsidiaries Innolux Corporation CyberTAN Technology Inc. and Subsidiaries General Interface Solution Holding Limited and Subsidiaries Ennoconn Corporation and Subsidiaries Fuyao Precision Component (Kunshan) Co., Ltd. SIO International Holdings Limited Taiwan Branch Hebi Gengde Electronics Co., Ltd.			Entities with significant influence to the Group 〞 Other related party 〞 〞 〞 〞 〞 〞 〞 〞 〞

~56~

(2) Significant related party transactions

A. Sales

Sales of goods and services: Entities with significant influence to the Group -Hon Hai and Subsidiaries Other related parties	2021 2020 14,720,213 $ 18,424,975 $ 335,360 313,972 15,055,573 $ 18,738,947 $ Year ended December 31,

Except for circumstances in which there are no similar transactions for reference and the prices and credit periods are negotiated by both parties, the aforementioned related party is offered prices very close to those offered to other customers and given a payment period of 30 to 90 days. For transactions involving the sale of raw materials to the aforementioned related party and subsequent repurchase of goods made from the same raw materials from the same party, the initial sale of raw materials is eliminated due to economic substance.

B. Purchases

Purchases
Purchases of goods and services: Entities with significant influence to the Group -Hon Hai and Subsidiaries Other related parties	Year ended December 31,
	2021 68,714,940 $ 7,471,566 76,186,506 $	2020
		70,386,346 $ 5,985,420
		76,371,766 $

Except for circumstances in which there are no similar transactions for reference and the prices and payment terms are negotiated by both parties, the Group makes purchases from the aforementioned related party at the prevailing market price, with payment periods of 30 to 90 days.

C. Receivables from related parties

~57~

	December31,2021	December31,2021	December31,2020	December31,2020	December31,2020
Accounts receivable:
Entities with significant
influence to the Group
-Hon Hai and Subsidiaries	$	7,909,711		$	11,311,060
Other related parties		49,700			68,502
		7,959,411			11,379,562
Less: Allowance for
uncollectible accounts	(	2,152)	(		3,129)
		7,957,259			11,376,433
Other receivables-purchases
made on behalf of
associates:
Entities with significant
influence to the Group
-Hon Hai and Subsidiaries		2,878,773			1,394,124
Other related parties		372,609			736,129
Other receivables-other:
Entities with significant
influence to the Group
-Hon Hai and Subsidiaries		264,025			46,060
		3,515,407			2,176,313
	$	11,472,666		$	13,552,746

The receivables from related parties arise mainly from sales transactions. The amount is due three months after the invoice date. The receivables are unsecured and non-interest bearing.

~58~

D. Payables to related parties

D. Payables to related parties
	December31,2021		December31,2020
Accounts payable:
Entities with significant
influence to the Group
-Hon Hai and Subsidiaries	$	19,584,912	$	20,904,215
Other related parties		1,092,548		864,250
		20,677,460		21,768,465
Other payables:
Entities with significant
influence to the Group
-Hon Hai and Subsidiaries
Payables for equipment		9,594		12,646
Purchases made by
associates on behalf
of the Company		3,915		1,315
Others		356,710		416,928
Other related parties
Others		7,944		13,169
		378,163		444,058
	$	21,055,623	$	22,212,523
The payables to related parties arise mainly from purchase		transactions and are at arm’s-length,
non-interest bearing and payable within 30~90 days.
E. Raw materials purchased on behalf of others
		Years ended	December31,
		2021		2020
Entities with significant influence to the Group
-Hon Hai and Subsidiaries
Raw materials purchased on behalf of associates	$	34,732,572	$	33,297,650
Associates purchasing raw materials on behalf of
the Group		10,094		6,182
Other related parties
Raw materials purchased on behalf of associates		2,693,649		1,839,924
	$	37,436,315	$	35,143,756
F. Property transactions
(a) Acquisition of property:

~59~

Acquisition of property, plant and equipment: Entities with significant influence to the Group -Hon Hai and Subsidiaries Other related parties	2021 2020 80,580 $ 79,014 $ 1,044 392 81,624 $ 79,406 $ Years endedDecember31,

• (b) Proceeds from sale of property, plant and equipment:

		Three-monthperiods	Three-monthperiods	Three-monthperiods	Three-monthperiods	ended June 30,	ended June 30,
		2021				2020
	Proceeds from				Proceeds from
	sale of property,				sale of property,
Sale of property, plant and		plant and				plant and
equipment:		equipment	Gain	on sale		equipment	Gain	on sale
Entities with significant
influence to the Group
-Hon Hai and Subsidiaries	$	469,377	$	188,362	$	261,225	$	188,036

• G. Lease transactions - lessee

• (a) The Group leases plant from entities with significant influence to the Group. Rental contracts are typically made for periods of 1 to 6 years. Rents are paid at the beginning or end of each month.

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

The Group acquired right-of-use assets from related parties amounting to $79,625 and $2,687

for the years ended December 31, 2021 and 2020, respectively.

• (c) Lease liabilities:

• i. Outstanding balance:

ase liabilities: Outstanding balance:
Interest expense Current: Entities with significant influence to the Group Non-current: Entities with significant influence to the Group Entities with significant influence to the Group	December31,2021 27,282 $ 57,979 $ Year ended December 31, 2021 2021 7,685 $	December31,2020
		142,017 $
		85,619 $
		Year ended December 31, 2020 2020
		14,020 $

• ii. Interest expense

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H. Loans to/ from related parties:

Loans from related parties

(a) Outstanding balance (listed in “short-term loans”):

(b) Interest expense Other related parties Other related parties	December31,2021 December31,2020 95,790 $ 95,801 $ 2021 2020 4,314 $ 4,179 $ Years ended December 31,	December31,2020
		95,801 $
		4,179 $

I. Rental income

Foxconn Precision Electronics (Taiyuan) Co., Ltd. (referred herein as “Foxconn (Taiyuan)”), a subsidiary of Hon Hai, leases part of plants, offices and dormitories in Taiyuan from the Group in April, 2016. Lease price is agreed upon by both parties and the Group collects rent monthly from Foxconn (Taiyuan) in accordance with the agreement. The rental income under operating leases for the years ended December 31, 2021 and 2020 were $116,963 and $119,838, respectively.

(3) Key management compensation

respectively. Key management compensation
Salaries and other short-term employee benefits Post-employment benefits Share-based payments	Years ended December31,
	2021 26,477 $ 560 38,665 65,702 $	2020
		36,162 $ 524 33,912
		70,598 $

8. PLEDGED ASSETS

On June 30, 2021, December 31, 2020 and June 30, 2020, the book value of the Group’s assets pledged as collateral is as follows:

as collateral is as follows:
Pledge assets December31,2021 December31,2020 Land use right (shown as ‘right-of-use assets’) 107,441 $ 110,391 $ Pledged time deposits (shown as ‘financial assets at amortized cost - current’) 18,080 $ 17,647 $ Bookvalue	Purpose
	Sealed up by creditors (Note) Customs guarantee

Note: Our subsidiary’s creditors proposed a request for property preservation and proceeded a seal-up. Please see Note 7 (2) 8 for loans from related parties.

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACT

COMMITMENTS

(1) Contingencies

None.

(2) Commitments

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

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Property, plant and equipment

December 31, 2021 December 31, 2020 $ 15,507 $ 41,861

10. SIGNIFICANT DISASTER LOSS

None.

11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE

(1) The Group entered into a memorandum of understanding with MEPA Labs Inc. on March 14, 2022 to establish a joint venture with a total investment amount of US$20,000 thousand approximately.

(2) As of March 22, 2022, the Board of Directors have approved the proposal for the appropriation of earnings in 2021, as described in Note 6(18).

12. OTHERS

• (1) Capital management

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

During 2021, the Group’s strategy, which was unchanged from 2020, was to maintain the gearing ratio below 70%.

(2) Financial instruments

• A. Financial instruments by category

• Financial assets of the company and its subsidiaries (financial assets measured at fair value through profit and loss, financial assets measured at fair value through other comprehensive gains and losses, financial assets measured at amortized cost, cash and cash equivalents, accounts receivable (Including related parties), other receivables and refundable deposits) and financial liabilities (short-term loans, financial liabilities measured at fair value through profit and loss, accounts payable (including related parties), other payables, lease liabilities, and guarantee deposit received) is provided in Note 6 and consolidated balance sheet.

• B. Risk management policies

• (a) Risk categories:

The Group employs a comprehensive financial risk management and control system to clearly identify, measure and control the various kinds of financial risk it faces, including market risk (including foreign exchange risk, interest rate risk and price risk), credit risk and liquidity risk.

• (b) Management objectives:

• i.Except for market risk, which is controlled by outside factors, the remainder of the foregoing types of risks can be controlled internally or removed from business processes. Therefore, the goal in managing each of these risks is to reduce them to zero.

• ii.As for market risk, the goal is to optimize its overall position through strict analysis, suggestion, execution and audit processes, and proper consideration of a) long-term trends in the external economic/financial environment, b) internal operating conditions, and c) the actual effects of market fluctuations.

• iii.The Group’s overall risk management policy focuses on the unpredictable items in financial markets and seeks to reduce the risk that potentially pose adverse effects on the Group’s financial position and financial performance.

• iv.For the information on the derivative financial instruments that the Group enters into, please refer to Note 6(2).

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• (c) Management system:

• i.Risk management is executed by the Group’s finance department by following policies approved by the Board. Through cooperation with the Group's operating units, finance department is responsible for identifying, evaluating and hedging financial risks.

• ii.The Board has a written policy covering overall risk management. It also has written policies covering specific issues, such as exchange rate risk, interest rate risk, credit risk, derivative and non-derivative financial instruments used, and the investment of excess working capital.

• C. Significant financial risks and degrees of financial risks

• (a) Market risk

Foreign exchange risk

• i. Nature :

The Group is a multinational group in the Electronic manufacturing services industry. Most of the exchange rate risk from operating activities comes from:

• (i) Foreign exchange risk arises from different exchange rates to functional currency as the invoice dates of accounts receivable and payable denominated in non-functional foreign currency are different. Because the amount after the assets and liabilities are offset is insignificant, income/loss is insignificant as well. (Note: The Group has several sites in various countries and thus is exposed to various foreign exchange risks. The main risk arises from USD and RMB.)

• (ii) Changes in exchange rates of functional currencies to presentation currency at different timing will cause another foreign exchange risk.

• (iii) Except for the above transactions (operating activities) recognized in the income statement, assets and liabilities recognized in the balance sheet and the net investment in foreign operations also result in the exchange rate risk.

• ii.Management:

• (i) For such risks, the Group has set up policies requiring companies in the Group to manage its exchange rate risks.

• (ii) As to the exchange rate risk arising from the difference between various functional currencies and the reporting currency in the consolidated financial statements, it is managed by the Group’s finance department.

iii.Sources of risk:

• (i) U.S. dollars and NT dollars:

Foreign exchange risk arises primarily from gains or losses from translating U.S. dollardenominated assets, such as cash, cash equivalents, accounts receivable, other receivables and time deposits with maturity in excess of three months, and U.S. dollar-denominated liabilities, such as loans, accounts payable and other payables, into New Taiwan dollars.

• (ii) U.S. dollars and RMB:

• Foreign exchange risk arises primarily from gains or losses from translating U.S. dollardenominated cash, cash equivalents, accounts receivable and other receivables, loans, accounts payable and other payables, which results in exchange loss or gain when they are translated into RMB.

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iv.The information on assets and liabilities denominated in foreign currencies whose values would be materially affected by the exchange rate fluctuations is as follows: December 31, 2021

		Foreign
		currency				Degree
		amount	Exchange		Book value	of		Effect on
	(in thousands)		rate		(NTD)	variation	profit or loss
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD：NTD	$	928,012	27.68	$	25,687,372	1%	$	256,874
USD：RMB		581,553	6.3757		8,467,423	1%		84,674
Non-monetary items
Foreign operations
USD：NTD		4,242,417	27.68		120,619,108
Financial liabilities
Monetary items
USD：NTD		776,707	27.68		21,499,250	1%		214,992
USD：RMB		210,978	6.3757		5,839,871	1%		58,399
			December31,2020
		Foreign
		currency				Degree
		amount	Exchange		Book value	of		Effect on
	(in thousands)		rate		(NTD)	variation	profit or loss
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD：NTD	$	661,979	28.48	$	18,853,162	1%	$	188,532
USD：RMB		581,553	6.5249		16,562,629	1%		165,626
Non-monetary items
Foreign operations
USD：NTD		4,242,417	28.48		120,824,032
Financial liabilities
Monetary items
USD：NTD		695,550	28.48		19,809,264	1%		198,093
USD：RMB		380,491	6.5249		10,836,384	1%		108,364
v.Total exchange gain (loss), including realized					and unrealized, arising from significant
foreign exchange variation on the			monetary	items held by the		Group for	the years ended
December 31, 2021 and 2020 amounted to $120,240 and 319,422, respectively.

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Price risk

i.Nature

The Group primarily invests in domestic and foreign publicly traded and unlisted equity instruments, which are accounted for as financial assets at fair value through other comprehensive income. The price of those equity instruments will be affected by the uncertainty of the future value of the investment.

• ii.Extent

If the price of such equity instrument rises or falls by 1%, with all other factors held constant, the impact on other comprehensive income due to equity instruments measured at fair value through other comprehensive income would increase/decrease $383,458 and $366,011 for the years ended December 31, 2021 and 2020, respectively.

Cash flow and fair value interest rate risk

The Group’s interest rate risk arises from short-term loans. Short-term loans with floating rates expose the Group to cash flow interest rate risk, but most of the risks are offset by cash and cash equivalents with variable interest rates.

If short-term loans interest rates rise or fall by 1%, with all other factors held constant, profit after tax would decrease/increase by $19,716 and $9,305 for the years ended December 31, 2021 and 2020, 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.

• According to the Group’s credit policy, each local entity in the Group is responsible for managing and analyzing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. The Group assesses the credit quality of the customers by taking into account their financial position, past experience and other factors to conduct its internal risk management.

Individual risk limits are set based on internal or external ratings in accordance with limits set by the Board of Directors. The utilization of credit limits is regularly monitored. Major credit risk arises from cash and cash equivalents, derivative financial instruments, deposits and short-term investments with banks and financial institutions, and other financial instruments. The counterparties are banks with good credit quality, financial institutions with investment grade credit ratings and government agencies, so there is no significant default concerns and credit risk.

• ii. 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. If the contract payments were past due over 90 days based on the terms, there has been deemed that a breach of contract has occurred.

• iii. 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;

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

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

• iv. The ageing analysis of accounts receivable (including related parties) as follows:

Not past due 0 to 90 days 91 to 180 days 181 to 270 days 271 to 360 days Over 361 days	December31,2021 21,558,011 $ 3,741,842 57,825 1,884 476 656 25,360,694 $	December31,2020
		25,451,974 $ 4,193,759 - 1,632 31 341
		29,647,737 $

The above ageing analysis was based on past due date.

• v. As of December 31, 2021 and 2020, accounts receivable (including related parties) and notes receivable were all from contracts with customers. As of January 1, 2020, the balance of receivables (including related parties) from contracts with customers amounted to $29,580,204.

• vi. The Group assesses the expected credit losses of accounts receivable (including those from related parties) as follows:

• (i) Accounts receivable are divided into segments according to the Group’s credit rating standards; expected credit losses for each segment are assessed based on the specific loss rate or provision matrix for the segment.

• (ii) Loss rates are calculated based on past and current information, taking into account forward-looking information provided by the Business Indicators Database of the National Development Council and the Basel Committee on Banking Supervision.

(iii) As of December 31, 2021 and	(iii) As of December 31, 2021 and	(iii) As of December 31, 2021 and	(iii) As of December 31, 2021 and	2020, the loss allowance for	2020, the loss allowance for	2020, the loss allowance for	accounts receivable	accounts receivable
(including related parties), assessed using loss rate						or provision matrix, is as follows:
	Group1and2			Group 3		Group4		Total
December 31, 2021
Expected loss rate		0.0270%		0.0630%		0.0630%
Total book value	$	23,347,044	$	1,069,011	$	944,639	$	25,360,694
Allowance for
uncollectible
accounts	$	6,633	$	710	$	628	$	7,971

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December 31, 2020 Expected loss rate Total book value Allowance for uncollectible accounts	Group1and2 0.0285% 27,747,935 $ 7,917 $	Group 3 0.0665% 803,727 $ 535 $	Group4 0.0665% 1,096,075 $ 729 $	Total
				29,647,737 $
				9,181 $

• 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 policies for those that have no external credit ratings.

• Group 2: Standard Poor’s or Fitch’s rating of BBB, Moody’s rating of Baa, or rated as B or C in accordance with the Group’s credit policies for those that have no external credit ratings.

• Group 3: Standard Poor’s or Fitch’s rating of BB + and below, or Moody’s rating of Ba1 and below.

• Group 4: Rated as other than A, B, or C in accordance with the Group’s credit policies for those that have no external credit ratings.

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

			2021
At January 1		$	9,181
Gain on reversal of expected credit impairment loss	(		1,186)
Effect of foreign exchange	(		24)
At December 31		$	7,971
			2020
At January 1			9,892
Gain on reversal of expected credit impairment loss	(		699)
Effect of foreign exchange	(		12)
At December 31		$	9,181

(c) Liquidity risk

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

• ii. The Group’s non-derivative financial liabilities and net-settled or gross-settled derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date for non-derivative financial liabilities

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and to the expected maturity date for derivative financial liabilities.

Except for lease liabilities listed below, as of December 31, 2021 and 2020, the Group’s non-derivative financial liabilities (including short-term loans, accounts payable and other payables) and derivative financial liabilities (including foreign exchange contracts, cross currency swap contracts and forward foreign exchange contracts) will expire within 1 year.

1 year.
December 31, 2021 Lease liability December31,2020 Lease liability	Less than 1 year Between 1 to 2 years 67,816 $ 66,540 $ 169,096 $ 47,159 $	Over 2 years 484,966 $ 166,832 $	Total
			619,322 $ 383,087 $

(3) Fair value information

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

• Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. A market is regarded as active where a market in which transactions for the asset or liability takes place with sufficient frequency and volume to provide pricing information on an ongoing basis. The fair value of the Group’s investment in listed stocks is included in Level 1.

• Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. The fair value of the Group’s investment in derivative instruments is included in Level 2.

• Level 3: Unobservable inputs for the asset or liability.

• B. Fair value information on investment property at cost is provided in Note 6(11).

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

• (a) The related information of the nature of the assets and liabilities is as follows:

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

December 31, 2021 Level 1 Level 2 Level 3 Total
Assets
Recurring fair value
measurements
Financial assets at fair
value through profit or
loss
Derivative instruments $ - $ 22,357 $ - $ 22,357
Financial assets at fair
value
through profit or loss-
non-current
Fund $ - $ - $ 272,437 $ 272,437
Debt instrument - - 14,451 14,451
$ - $ - $ 286,888 $ 286,888
Financial assets at fair
value
through other
comprehensive income
Equity instruments $ 34,414,490 $ - $ 3,931,329 $ 38,345,819
Liabilities
Recurring fair value measurements
Financial liabilities at fair value
through profit or loss
Derivative instruments $ - $ 6,015 $ - $ 6,015
----- End of picture text -----

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December 31, 2020 Level 1 Assets Recurring fair value measurements Financial assets at fair value through profit or loss Derivative instruments - $ Financial assets at fair value through profit or loss-non- current Fund - $ Financial assets at fair value through other comprehensive income Equity instruments 32,396,608 $ Liabilities Recurring fair value measurements Financial liabilities at fair value through profit or loss Derivative instruments - $	Level 2 63,079 $ - $ - $ 214,420 $	Level3 - $ 524,752 $ 4,204,508 $ - $	Total
			63,079 $
			524,752 $
			36,601,116 $
			214,420 $

• (b) The methods and assumptions the Group used to measure fair value are as follows:

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

Listed shares

Market quoted price Closing price

• ii. The fair value of foreign investment fund is measured by reference to counterparty quotes.

• iii. When assessing non-standard and low-complexity financial instruments, for example, debt instruments without active market, interest rate swap contracts, foreign exchange contracts and options, the Group adopts valuation technique that is widely used by market participants. The inputs used in the valuation method to measure these financial instruments are normally observable in the market.

• iv. The valuation of derivative financial instruments is based on valuation model widely accepted by market participants, such as present value techniques and option pricing models. Forward exchange contracts are usually valued based on the current forward exchange rate.

• v. The output of valuation model is an estimated value and the valuation technique may not be able to capture all relevant factors of the Group’s financial and non-financial instruments. Therefore, the estimated value derived using valuation model is adjusted accordingly with additional inputs, for example, liquidity risk and etc. In accordance with the Group’s management policies and relevant control procedures relating to the valuation models used for fair value measurement, management believes adjustment to valuation is necessary in order to reasonably represent the fair value of financial and nonfinancial instruments at the consolidated balance sheet. The inputs and pricing information used during valuation are carefully assessed and adjusted based on current

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market conditions.

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

• D. For the year ended December 31, 2021 and transferred it from Level 3:

		2021		2020
At January 1	$	4,729,260	$	2,778,608
Gains and losses recognized in profit or loss	(	251,690)		25,357
Gains and losses recognized in other
comprehensive income		4,622,551		2,024,105
Additions		2,548,716		-
Transferred to level 1	(	7,414,609)		-
Effect of foreign exchange	(	16,011)	(	98,810)
At December 31	$	4,218,217	$	4,729,260

The Group invested in the equity interest of VIZIO HOLDING CORP. through the subsidiary, Q-Run Holdings Ltd., for the year ended December 31, 2021 and transferred it from Level 3 to Level 1 as the lockup period has expired.

• E. For the years ended December 31, 2021 and 2020, there was no transfer into or out from Level 3.

• F. The financial assets at fair value through profit or loss and the financial assets at fair value through other comprehensive income, categorized within Level 3, on December 31, 2021 pertain to the investment in convertible bonds of SOTERA WIRELESS, INC and Hon Fujin Precision Industry (Taiyuan) Co., Ltd. and equity interest of Modest Benefits Taiwan E Chain Co., Ltd. and H2U Corporation and EIRGENIX, INC. of lock-up period equity and equity investment in FE HOLDINGS USA, INC. and VIZIO Inc. invested through the subsidiary, Q-Run Holdings Ltd.. The qualitative information of significant unobservable inputs and sensitivity analysis of changes in significant unobservable inputs to valuation models used in Level 3 measurement are net asset value and market price method.

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

Fair value Significant Range Relationship
at December, Valuation Unobservable (weighted of inputs to
31,2021 Technique Input average) fair value
Non-derivative
equity instrument:
Private equity
$ 272,437 Net asset value Not applicable Not applicable Not applicable
fund investment
The higher the
lock-up period
Market price Discount for lack discount for
listed company $ 1,898,600 38.08%
method of marketability marketability, the
shares
1ower the fair value.
Unlisted shares $ 2,014,714 Net asset value Not applicable Not applicable Not applicable
Market price The latest capital
Unlisted shares 18,015 NT10~55 Not applicable
method increase price
$ 2,032,729
Hybrid instrument:
The higher for the
Convertible Discounted
$ 14,451 Discount rate 14.84% discount rate, the
Bonds Cash Flow
lower the fair value.
Fair value Significant Range Relationship
at December 31, Valuation Unobservable (weighted of inputs to
2020 Technique Input average) fair value
Non-derivative
equity instrument:
Private equity
$ 524,752 Net asset value Not applicable Not applicable Not applicable
fund investment
Unlisted shares $ 2,134,544 Net asset value Not applicable Not applicable Not applicable
Market price P/E multiplier 7.8 The higher the
Unlisted
multiplier, the higher
shares $ 2,069,964 method P/S multiplier 0.24
the fair value
----- End of picture text -----

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

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Input Financial assets Debt instrument Discount Rate Equity instruments Discount for lack of marketability Input Financial assets Equity instruments Multipliers of the price-to- earnings ratio and price-to- sales ratio	Change ±1% ±1% Change ±1%		Favourable Unfavourable change change 1,358 $ 1,282) ($ - $ - $ Recognized in December December profit or loss	Favourable Unfavourable change change 1,358 $ 1,282) ($ - $ - $ Recognized in December December profit or loss	Favourable Unfavourable change change 1,358 $ 1,282) ($ - $ - $ Recognized in December December profit or loss	31,2021 Recognized in other comprehensiveincome
						Favourable Unfavourable change change - $ - $ 30,685 $ 30,641) ($ comprehensiveincome 31,2020 Recognized in other
			profit or loss Recognized in
			Favourable change - $	Unfavourable change - $		Favourable Unfavourable change change 20,700 $ 20,700) ($

(4) Other

The Group has adopted relative preventive measures in response to the Covid-19 pandemic and various preventive measures imposed by the government, the pandemic has no significant impact to the operations and businesses of the Group for the year ended December 31, 2021.

13. SUPPLEMENTARY DISCLOSURES

(1) Significant transactions information

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

• B. Provision of endorsements and guarantees to others: None.

• C. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures): Please refer to table 2.

• D. Acquisition or sale of the same security with the accumulated cost reaching $300 million or 20% of paid-in capital or more: Please refer to table 3.

• 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 4.

• H. Receivables from related parties reaching $100 million or 20% of paid-in capital or more: Please refer to table 5.

• I. Trading in derivative instruments undertaken during the reporting periods: Please refer to Notes 6(2), 6(24) and 12(3).

• J. Significant inter-company transactions during the reporting periods: Please refer to table 6.

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(2) Information on investees

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

(3) Information on investments in Mainland China

• A. Basic information: Please refer to table 8.

• B. Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area: Please refer to table 6.

(4) Information of major shareholders

Major shareholders information: Please refer to table 9.

14. SEGMENT INFORMATION

(1) General information

The Group is primarily engaged in the assembly and sales of cases, heat dissipation modules and consumer electronics products. The chief operating decision-maker manages abovementioned items by business activities. Currently, business activities can be categorized into trading services of electronic products and manufacturing and sales of mechanism and components.

Revenue and operating income of operating segments are used by the Group’s chief operating decision-maker for imputation of internal costs and allocation of expenses to segment profit (loss) and are used as an indication for assessment of performance and allocation of resources.

(2) Measurement of segment information

The financial information of reportable segments provided to the chief operating decision maker is as follows:

as follows:
External revenue Inter-segment revenue Segment revenue Measurement of segment profit or loss Depreciation and amortization Interest income Interest expense Total segment assets (Note)	YearendedDecember31,2021
	Electronic products trading services 80,584,937 $ 1,011,729 81,596,666 $ 2,451,728 $ 3,473 $ 2,365 $ 86,224 $ - $	Production and sales of mechanical components 23,294,718 $ 3,113,453 26,408,171 $ 1,461,667 $ 1,472,034 $ 1,604,415 $ 60,988 $ - $	Total
			103,879,655 $ 4,125,182
			108,004,837 $
			3,913,395 $
			1,475,507 $
			1,606,780 $
			147,212 $
			- $

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Year ended December 31, 2020

External revenue Inter-segment revenue Segment revenue Measurement of segment profit or loss Depreciation and amortization Interest income Interest expense Total segment assets (Note)	Electronic products tradingservices 77,513,692 $ 623,156 78,136,848 $ 2,444,272 $ 3,935 $ 13,119 $ 120,554 $ - $	Production and sales of mechanical components 27,119,548 $ 2,076,744 29,196,292 $ 1,811,325 $ 1,552,310 $ 2,021,814 $ 128,745 $ - $	Total
			104,633,240 $ 2,699,900
			107,333,140 $
			4,255,597 $
			1,556,245 $
			2,034,933 $
			249,299 $
			- $

Note: The measurement of operating segment assets is not provided to the operating decision-maker; thus, the measurement that shall be disclosed is zero.

(3) Reconciliation for segment income (loss)

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

A reconciliation of reportable segment profit or loss to the profit/ (loss) before tax and discontinued operations for the three-month and six-month periods ended June 30, 2021 and 2020 is provided as follows:

follows:
			YearendedDecember			31,
Operatingrevenue			2021			2020
Reportable segments revenue		$	108,004,837		$	107,333,140
Other segments revenue			202,376			156,359
Elimination of inter-segment revenue	(		4,125,182)	(		2,699,900)
Total corporate revenue		$	104,082,031		$	104,789,599

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Year ended December 31,
Profit and loss 2021 2020
Profit of reportable segment $ 3,913,395 $ 4,255,597
Profit of other operating segments 501,241 430,526
Post-tax profit (loss) $ 4,414,636 $ 4,686,123
----- End of picture text -----

(4) Information on product

Information on product
Operatingrevenue Electronic products Mechanism and components Others	2021 2020 80,584,937 $ 77,513,692 $ 23,294,718 27,119,548 202,376 156,359 104,082,031 $ 104,789,599 $ Year ended December31,
		104,789,599 $

(5) Geographical information

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

Year ended December 31,

China Japan Taiwan USA Others	Non-current Revenue assets 22,845,025 $ 8,450,841 $ 75,406,217 - 2,414,029 622,813 1,844,744 - 1,572,016 6 104,082,031 $ 9,073,660 $ 2021	2020	2020
		Revenue 26,392,939 $ 72,595,317 1,433,056 827,084 3,541,203 104,789,599 $	Non-current assets
			8,696,430 $ - 193,518 23 6
			8,889,977 $

(6) Major customer information

Details of customers contributing more than 10% of operating revenue of the Group for the years ended December 31, 2021 and 2020 are as follows:

Year ended December 31,

Customer A Group B Group	Revenue % 74,383,762 $ 71% 14,720,213 14% 89,103,975 $ 2021	2020	2020
	Revenue 74,383,762 $ 14,720,213 89,103,975 $	Revenue 72,498,904 $ 18,424,975 90,923,879 $	%
			69% 18%

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Foxconn Technology Co., Ltd. and Subsidiaries

Table 1

Loans to others

Year ended December 31, 2021

Expressed in thousands of NTD (Except as otherwise indicated)

Actual amount drawn down No. Creditor Interest rate Nature of loan Amount of transactions with the borrower Borrower General ledger account Is a relatedparty Reason for short-term financing Allowance for doubtful accounts Maximum outstanding balance during the year ended December 31,2021 Balance at December 31,2021	Collateral	Limit on loans granted to a singleparty	Ceiling on total loansgranted	Note
	Item Value
1 Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Qingdao Hiyn Materials Co., Ltd. Other receivables Y 160,311 $ - $ - $ 0.00% Short-term financing $ - Business operation $ - 1 Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fuzhun Precision Industy (Shenyang) Co., Ltd. Other receivables Y 193,745 139,331 139,331 3.465% Short-term financing - Business operation - 2 FOXCONN TECHNOLOGY PTE. LTD. YanTai Fuzhun Precision Electronics Co., Ltd. Other receivables Y 570,800 553,600 553,600 0.43863% Short-term financing - Business operation -	None $ - None - None -	4,120,527 $ 82,410,532 48,088,000	16,482,108 $ 164,821,064 96,176,000	Note 1 Note 2 Note 2

Note 1: For short-term loans, limit on loans granted for a single party is 10% of the lending company’s net assets and ceiling on total loans is 40% of the Company’s net assets based on the latest audited or reviewed financial statements. Note 2: Limit on loans granted for a single foreign company whose voting rights are 100% owned directly and indirectly by the Company is 200% of the net assets of the creditor's subsidiary and 400% for ceiling on total loans.

Table 1, Page 1

Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures) Year ended December 31, 2021

Foxconn Technology Co., Ltd. and Subsidiaries

Year ended December 31, 2021
Table 2 Securities held by Marketable securities Relationship with the securities issuer General ledger account		Bookvalue Ownership (%) Fairvalue Expressed in thousands of NTD (Except as otherwise indicated) Note As of December31,2021
	Number of shares	Bookvalue	Ownership (%) Fairvalue
Foxconn Technology Co., Ltd. Common stock of CyberTAN Technology Inc. None Financial assets at fair value through other comprehensive income - non-current 〞 Common stock of Pan-International Industrial Corp. 〞 〞 〞 Common stock of Innolux Corporation 〞 〞 〞 Common stock of Advanced Optoelectronic Technology, Inc. 〞 〞 〞 Common stock of EIRGENIX, INC. 〞 〞 〞 Common stock of Modest Benefits Taiwan E Chain Co., Ltd. 〞 〞 〞 Common stock of H2U Corporation 〞 Financial assets at fair value through profit or loss - non-current 〞 Convertible Bonds of SOTERA WIRELESS, INC. 〞 Financial assets at fair value through other comprehensive income - non-current Huazhun Investment Co., Ltd. Common stock of Innolux Corporation 〞 〞 〞 Common stock of Advanced Optoelectronic Technology, Inc. 〞 〞 〞 Common stock of Modest Benefits Taiwan E Chain Co., Ltd. 〞 〞 Q-Run Holdings Ltd. Common stock of China Harmony Auto Holding Ltd. 〞 〞 〞 Common stock of FE Holdings USA, Inc. 〞 〞 〞 Preferred stock of Vizio Holding Corp. 〞 〞 Foxconn Technology Pte. Ltd. Common stock of Sharp Corporation 〞 〞 Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Jinan Fujie Industrial Investment Fund Partnership (limited partnership) 〞 Financial assets at fair value through profit or loss - non-current Hon Fujin Precision Industry (Taiyuan) Co., Ltd Guangdong Finance Trust - Peng Yun Tian Hua Collection Fund Trust 〞 Financial assets at amortised cost - non-current	10,035,348 1,079,986 127,556,349 1,000 27,500,000 150,000 273,000 - 121,036,800 7,672,000 150,000 38,452,340 8,040 14,412,115 64,640,000 - -	311,598 $ 42,551 2,500,104 26 1,898,600 1,500 15,015 14,451 2,372,320 197,170 1,500 676,420 2,014,714 7,751,158 20,563,143 272,437 2,177,032	3.05 311,598 $ 0.21 42,551 1.21 2,500,104 - 26 9.15 1,898,600 0.25 1,500 1.15 15,015 - 14,451 1.15 2,372,320 5.31 197,170 0.25 1,500 2.44 676,420 11.42 2,014,714 7.84 7,751,158 10.58 20,563,143 6.67 272,437 - 2,177,032

Table 2, Page 2

Table 3

Foxconn Technology Co., Ltd. and Subsidiaries

Aggregate purchases or sale of the same securities reaching $300 million or 20% of paid-in capital or more

Year ended December 31, 2021

Expressed in thousands of NTD (Except as otherwise indicated)

Investor Marketable securities General ledger account Counterparty Relationship with the investor	Balance as at January1,2021	Addition	Disposal		Balance a	s at June 30,2021
	Amount Number of shares (In thousands)	Amount Number of shares (In thousands)	Selling price Book value Number of shares	Gain (loss) on disposal	Number of shares	Amount
Q-Run Holdings Ltd., Common stock of VIZIO HOLDING CORP. Note 1 None Foxconn Technology Co., Ltd. Common stock of EIRGENIX, INC. Note 1 〞 Fuzhun Precision (Shenzhen) Industry Co., Ltd. Guangdong Finance Trust - Peng Yun Tian Hua Collection Fund Trust Note 2 Guangdong Yuecai Intrust & Investment Company 〞 Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Guangdong Finance Trust - Peng Yun Tian Hua Collection Fund Trust Note 2 Guangdong Yuecai Intrust & Investment Company 〞	Note 3 USD 72,681 thousand - - - RMB 50,000 thousand - RMB 550,000 thousand	- - 27,500 thousand NTD 2,516,250 thousand - - - -	746 thousand USD 14,591 thousand - - - - - RMB 52,949 thousand RMB 50,000 thousand - RMB 52,949 thousand RMB 50,000 thousand	USD 14,591 thousand - RMB 2,949 thousand RMB 2,949 thousand	14,412 thousand 27,500 thousand - -	USD 280,027 thousand NTD 1,898,600 thousand - RMB 500,000 thousand

Note 1 ： Recorded in “financial assets at fair value through other comprehensive income - non-current”, the ending amount is presented at fair value.

Note 2 ： Recorded in “financial assets at amortized cost - non-current”.

Note 3：The 67 thousand convertible special shares of VIZIO INC. held by the Group originally have been converted into 15,158 thousand common shares, because VIZIO HOLDING CORP. adjust the shareholding structure before listing on the New York Stock Exchange on March 25, 2021.

Table 3, Page 3

Expressed in thousands of NTD (Except as otherwise indicated)

Foxconn Technology Co., Ltd. and Subsidiaries

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

Year ended December 31, 2021

Table 4

Purchaser/seller	Counterparty	Relationshipwith the counterparty		Transaction	Transaction		Differences in transaction terms compared to third partytransactions	Differences in transaction terms compared to third partytransactions	Notes/accounts receivable(payable)	Notes/accounts receivable(payable)	Note
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unit price	Credit term	Balance	Percentage of total notes/accounts receivable (payable)
Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. FOXCONN TECHNOLOGY PTE. LTD. FOXCONN TECHNOLOGY PTE. LTD. FOXCONN TECHNOLOGY PTE. LTD. FOXCONN TECHNOLOGY PTE. LTD. FOXCONN TECHNOLOGY PTE. LTD.	Foxconn (Far East) Ltd. and subsidiaries Champ Tech Optical (Foshan) Corporation Foxconn (Far East) Ltd. and subsidiaries FOXCONN TECHNOLOGY PTE. LTD. Foxconn (Far East) Ltd. and subsidiaries FOXCONN TECHNOLOGY PTE. LTD. Foxconn (Far East) Ltd. and subsidiaries FTP Technology Inc. Hon Hai Precision Industry Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. CHENG UEI PRECISION INDUSTRY CO., LTD.	The indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. The investee is an indirect subsidiary of the Company The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The investee is an indirect subsidiary of the Company The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries The investee company' s transaction partner is Investment company evaluated by the equity method The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries Other related parties	Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales	1,250,373 $ 313,573 9,023,091 492,667 373,066 4,633,084 980,040 274,267 725,647 1,507,003 185,466	2 - 86 5 7 91 11 3 8 16 2	90 days 90 days 90 days 90 days 90 days 60 days 90 days 90 days 90 days 90 days 90 days	Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1	Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1	535,739 $ 383,302 5,736,389 92,946 147,255 2,182,721 209,437 106,782 318,248 76,554 7,100	3 2 96 2 6 92 10 5 15 4 -	Note 2

Table 4, Page 4

Purchaser/seller	Counterparty	Relationshipwith the counterparty		Transaction	Transaction		Differences in transaction terms compared to third partytransactions	Differences in transaction terms compared to third partytransactions	Notes/accounts receivable(payable)	Notes/accounts receivable(payable)	Note
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unit price	Credit term	Balance	Percentage of total notes/accounts receivable (payable)
FOXCONN TECHNOLOGY PTE. LTD. Fuzhun Precision (Shenzhen) Industry Co., Ltd. Nanning Funing Precision Electronics Co., Ltd. YanTai Fuzhun Precision Electronics Co., Ltd. YanTai Fuzhun Precision Electronics Co., Ltd. Champ Tech Optical (Foshan) Corporation Champ Tech Optical (Foshan) Corporation Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd.	Foxconn (Far East) Ltd. and subsidiaries Champ Tech Optical (Foshan) Corporation FOXCONN TECHNOLOGY PTE LTD. Foxconn (Far East) Ltd. and subsidiaries Fu Yu Precision Components (Kunshan) Co., Ltd. Foxconn (Far East) Ltd. and subsidiaries FOXCONN TECHNOLOGY PTE. LTD. Foxconn (Far East) Ltd. and subsidiaries Nanning Funing Precision Electronics Co., Ltd. Champ Tech Optical (Foshan) Corporation YanTai Fuzhun Precision Electronics Co., Ltd. INNOLUX CORPORATION SHARP CORPORATION	The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The investee is an indirect subsidiary of the Company The indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. The investee is an indirect subsidiary of the Company The investee is an indirect subsidiary of the Company The investee is an indirect subsidiary of the Company Other related parties Other related parties	Sales Sales Sales Sales Sales Sales Sales Purchases Purchases Purchases Purchases Purchases Purchases	221,555 $ 179,916 216,564 999,226 163,010 864,707 3,092,121 64,537,446 2,637,301 2,481,053 110,758 881,844 5,912,590	60 96 6 71 12 10 34 83 3 3 - 1 8	90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 30 days 90 days 90 days 60 days 60 days	Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1	Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1	- $ - 14,039 393,696 9,155 422,500 686,720 15,136,393) ( 582,822) ( 639,489) ( 17,397) ( 175,111) ( 659,124) (	- - 2 85 2 14 23 79) ( 3) ( 3) ( - 1) ( 3) (

Table 4, Page 5

Purchaser/seller	Counterparty	Relationshipwith the counterparty		Transaction	Transaction		Differences in transaction terms compared to third partytransactions	Differences in transaction terms compared to third partytransactions	Notes/accounts receivable(payable)	Notes/accounts receivable(payable)	Note
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unit price	Credit term	Balance	Percentage of total notes/accounts receivable (payable)
Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. FOXCONN TECHNOLOGY PTE. LTD. FOXCONN TECHNOLOGY PTE. LTD. Champ Tech Optical (Foshan) Corporation Champ Tech Optical (Foshan) Corporation	GENERAL INTERFACE SOLUTION LIMITED Pan-International Industrial Corp. and subsidiaries Foxconn (Far East) Ltd. and subsidiaries Foxconn (Far East) Ltd. and subsidiaries Foxconn (Far East) Ltd. and subsidiaries Hon Hai Precision Industry Co., Ltd. Foxconn (Far East) Ltd. and subsidiaries Pan-International Industrial Corp. and subsidiaries	Other related parties Other related parties The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The investee company' s transaction partner is Investment company evaluated by the equity method The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries Other related parties	Purchases Purchases Purchases Purchases Purchases Purchases Purchases Purchases	214,048 $ 138,923 2,489,263 153,009 557,191 506,429 438,241 252,691	- - 27 3 6 5 6 3	60 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days	Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1	Note1 Note1 Note1 Note1 Note1 Note1 Note1 Note1	9,920) ($ 121,480) ( 4,021,817) ( 9,867) ( 5,590) ( 131,142) ( 99,942) ( 94,612) (	- 1) ( 91) ( 1) ( - 4) ( 4) ( 4) (

Note 1:Except for circumstances in which there are no similar transactions for reference and the prices and credit periods are negotiated by both parties, the aforementioned related party is offered prices very close to those offered to other customers and given a payment period of 30 to 90 days. Note 2:For transactions involving the sale of raw materials to the aforementioned related party and subsequent repurchase of goods made from the same raw

materials from the same party, the initial sale of raw materials is eliminated due to economic substance.

Table 4, Page 6

Foxconn Technology Co., Ltd. and Subsidiaries

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

December 31, 2021

			December 31, 2021
Table 5 Creditor	Counterparty	Relationshipwith the counterparty	Balance as at December 31,2021	Turnover rate	Overdue receivables		Amount collected subsequent to the balance sheet date Expressed (Except as	in thousands of NTD otherwise indicated) Allowance for doubtful accounts
					Amount	Action taken
Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. FOXCONN TECHNOLOGY PTE. LTD. FOXCONN TECHNOLOGY PTE. LTD. Nanning Funing Precision Electronics Co., Ltd.	Foxconn (Far East) Ltd. and subsidiaries Foxconn (Far East) Ltd. and subsidiaries SHARP CORPORATION Pan-International Industrial Corp. and subsidiaries Champ Tech Optical (Foshan) Corporation Foxconn (Far East) Ltd. and subsidiaries Foxconn (Far East) Ltd. and subsidiaries FOXCONN TECHNOLOGY PTE. LTD. Foxconn (Far East) Ltd. and subsidiaries Hon Hai Precision Industry Co., Ltd. FTP Technology Inc.	The indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. The indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. Other related parties The investee is an indirect subsidiary of the Company The investee is an indirect subsidiary of the Company The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The investee is an indirect subsidiary of the Company and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are the investee of the Company accounted for using equity method The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries	535,739 $ 2.78 2,878,773 Not applicable 120,032 Not applicable 252,577 Not applicable 383,302 1.33 5,736,389 1.23 147,255 2.04 2,182,721 2.76 209,437 1.84 318,248 4.47 106,782 4.81 (shown as other receivables)(Note 1) (shown as other receivables)(Note 1) (shown as other receivables)(Note 1)		15,682 $ 136,223 3,351 16,631 121,443 - - -	Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection - - -	15,682 $ 136,223 3,351 16,631 121,443 - - -	- $ - - - - - -

Table 5, Page 7

Creditor	Counterparty	Relationshipwith the counterparty	Balance as at December 31,2021	Turnover rate	Overdue receivables	Overdue receivables	Amount collected subsequent to the balance sheet date	Allowance for doubtful accounts
					Amount	Action taken
Nanning Funing Precision Electronics Co., Ltd. YanTai Fuzhun Precision Electronics Co., Ltd. Champ Tech Optical (Foshan) Corporation Champ Tech Optical (Foshan) Corporation Champ Tech Optical (Foshan) Corporation	Foxconn Technology Co., Ltd. Foxconn (Far East) Ltd. and subsidiaries Foxconn (Far East) Ltd. and subsidiaries Foxconn Technology Co., Ltd. FOXCONN TECHNOLOGY PTE. LTD.	The Company’s ultimate parent company The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The Company’s ultimate parent company The investee is an indirect subsidiary of the Company	582,822 $ 393,696 422,500 639,489 686,720	5.43 4.26 2.53 4.30 4.91	- 2,405 85,275 - -	- Subsequent collection Subsequent collection - -	- 2,405 332,403 - -	- - - - -

Note 1: Receivables from purchases of materials by investees on behalf of the ultimate parent company.

Table 5, Page 8

Foxconn Technology Co., Ltd. and Subsidiaries

Table 6

Significant inter-company transactions during the reporting period

Year ended December 31, 2021

Expressed in thousands of NTD

(Except as otherwise indicated)

Transaction

Number (Note 1)	Companyname	Counterparty	Relationship (Note 2)	General ledger account	Amount	Transaction terms	Percentage of consolidated total operating revenues or total assets
0 0 0 0 0 0 0 1 2 2 3 3 3 4 5 5 5 6	Foxconn Technology Co., Ltd. 〝 〝 〝 〝 〝 〝 Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. 〝 FOXCONN TECHNOLOGY PTE. LTD. 〝 〝 YanTai Fuzhun Precision Electronics Co., Ltd. Nanning Funing Precision Electronics Co., Ltd. Champ Tech Optical (Foshan) Corporation 〝 Fuzhun Precision (Shenzhen) Industry Co., Ltd.	Nanning Funing Precision Electronics Co., Ltd. 〝 YanTai Fuzhun Precision Electronics Co., Ltd. Champ Tech Optical (Foshan) Corporation 〝 〝 〝 FOXCONN TECHNOLOGY PTE. LTD. 〝 〝 Hon Fujin Precision Industry (Taiyuan) Co., Ltd. FTP Technology Inc. 〝 Fu Yu Precision Components (Kunshan) Co., Ltd. FOXCONN TECHNOLOGY PTE. LTD. 〝 〝 Champ Tech Optical (Foshan) Corporation	1 1 1 1 1 1 1 3 3 3 3 3 3 3 3 3 3 3	Purchases Accounts payable Purchases Purchases Sales Accounts receivable Accounts payable Sales Sales Accounts receivable Sales Sales Accounts receivable Sales Sales Sales Accounts receivable Sales	2,637,301 $ 582,822 110,758 2,481,053 313,573 383,302 639,489 492,667 4,663,084 2,182,721 1,507,003 274,267 106,782 163,010 216,564 3,092,121 686,720 179,916	Note 4 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞	3 - - 2 - - 1 - 4 1 1 - - - - 3 - -

Note 1: The information of transactions between the Company and the subsidiaries should be noted in “Number” column.

Note 2: (1) Number 0 represents the Company.

Note 2: (2) The consolidated subsidiaries are numbered in order from number 1.

Note 2: The transaction relationship with counterparties are as follows:

Note 2: (1) The Company to the consolidated subsidiary.

Note 2: (2) The consolidated subsidiaries to the Company.

Note 2: (3) The consolidated subsidiaries to other consolidated subsidiaries.

Note 3: Disclosure standard of transactions between the Company and subsidiaries is when purchases, sales and receivables (payables) from (to) related parties account for at least $100,000 or 20% of capital. Relative related are not disclosed. Note 4: Except for circumstances in which there are no similar transactions for reference and the prices and credit periods are negotiated by both parties, the aforementioned related party is offered prices very close to those offered to other customers and given a payment period of 30 to 90 days.

Note 5: In calculating the ratio, the transaction amount is divided by consolidated total assets for balance sheet accounts and is divided by consolidated total revenues for income statement accounts. Note 6: For information of loans to others, please refer to table 1.

Table 6, Page 9

Table 7

Foxconn Technology Co., Ltd. and Subsidiaries

Information on investees

Year ended December 31, 2021

Expressed in thousands of NTD

(Except as otherwise indicated)

Investor	Investee	Location	Main business activities	Initial investment amount	Initial investment amount	Shares	held as at June 30,2021	held as at June 30,2021	Net profit (loss) of the investee for the six-month period ended June 30,2021	Investment income (loss) recognized by the Company for the six-month period ended June 30,2021	Note
				Balance as at June 30,2021	Balance as at December31,2020	Numberofshares	Ownership (%)	Bookvalue
Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd.	Q-Run Holdings Ltd. Foxconn Precision Components Holding Co., Ltd. Huazhun Investment Co., Ltd. Syntrend Creative Park Co., Ltd.	Cayman Islands Cayman Islands Taiwan Taiwan	Investment holding Investment holding Investment Retail of office machinery and equipment and electronic appliances, and information software services	9,851,192 $ 492,742 1,254,780 490,322	9,851,192 $ 492,742 1,254,780 490,322	480,077,600 135,839,643 125,478,000 49,032,250	100 100 100 20	104,296,052 $ 16,323,056 2,663,627 275,402	1,241,410 $ 533,274 48,305 10,898) (	1,228,318 $ 533,274 48,305 2,176) (

Note: Besides Foxconn Precision Components Holding Co., Ltd., Q-Run Holdings Ltd. and Huazhun Investment Co., Ltd. are subsidiaries of the Company, Atkinson Holdings Ltd., Q-Run Far East Corporation, World Trade Trading Ltd., High Tempo International Ltd., FTC Technology Inc., Foxconn Technology Pte. Ltd., Kenny International Ltd., Double Wealth Profits Ltd., Precious Star International Ltd., Eastern Star Limited., Gold Glory International Ltd., New Glory Holdings Ltd., FTP Technology Inc., Fuzhun Precision (Shenzhen) Industry Co., Ltd., Champ Tech Optical (Foshan) Corporation, Hon Fujin Precision Industry (Taiyuan) Co., Ltd., Fuzhun Precision (Hebi) Electronics Co., Ltd., Qingdao Hiyn Materials Co., Ltd., Fuhuigang Industrial (Shenzhen) Co., Ltd., Fu Yu Precision Components (Kunshan) Co., Ltd., YanTai Fuzhun Precision Electronics Co., Ltd., Nanning Funing Precision Electronics Co., Ltd. and Fuzhun Precision (Shenyang) Industry Co., Ltd. are subsidiaries of the Company as well.

Table 7, Page 10

Foxconn Technology Co., Ltd. and Subsidiaries

Information on investees in Mainland China

Table 8

Year ended December 31, 2021

Expressed in thousands of NTD

(Except as otherwise indicated)

Investee in Mainland China	Main business activities	Paid-in capital	Investment method (Note 1)	Accumulated amount of remittance from Taiwan to Mainland China as of January1,2021	Amount remitted from Taiwan to Mainland China / Amount remitted back to Taiwan for the year ended December 31,2021	Amount remitted from Taiwan to Mainland China / Amount remitted back to Taiwan for the year ended December 31,2021	Accumulated amount of remittance from Taiwan to Mainland China as of December 31,2021	Net income of investee for the six- month period ended December 31,2021	Ownership held by the Company (direct or indirect)	Investment income (loss) recognized by the Company for the six-month period ended December 31, 2021 (Note 2)	Book value of investments in Mainland China as of December 31,2021	Accumulated amount of investment income remitted back to Taiwan as of December 31,2021	Note
					Remitted to Mainland China	Remitted back to Taiwan
Fuhuigang Industrial (Shenzhen) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. Fuzhun Precision (Shenzhen) Industry Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Nanning Funing Precision Electronics Co., Ltd. YanTai Fuzhun Precision Electronics Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd.	Computer case – electronic and electrical components Manufacturing and marketing of power plug and wall socket, micro ribbon connectors for terminals, etc. Manufacturing and marketing of computer components (computer thermal module) Manufacturing and marketing of computer components and related peripherals, computer cases and metal stamping Manufacturing and marketing of computer components (computer thermal module) Manufacturing and marketing of computer case - electronic and electrical components New alloy material, precision molds, new electronic components, portable computers and their components	214,714 $ 1,424,551 539,760 11,348,800 271,264 2,124,400 4,088,336	2 2 2 2 2 2 2	214,714 $ 763,138 55,360 3,861,360 - 1,093,360 1,375,696	- $ - - - - - -	- $ - - - - - -	214,714 $ 763,138 55,360 3,861,360 - 1,093,360 1,375,696	13,565 $ 453,464 361,670 539,957 323,578 78,214 276,839	100 100 100 100 100 100 100	13,565 $ 453,464 361,670 539,957 323,578 78,214 276,839	476,854 $ 7,308,116 5,669,770 41,205,266 3,746,245 1,851,070 7,446,360	- $ - - - - - -

Table 8, Page 11

Accumulated amount of Investment amount approved Ceiling on investments in remittance from Taiwan to by the Investment Commission Mainland China imposed by Mainland China as of of the Ministry of Economic the Investment Commission Company name December 31, 2021 Affairs (MOEA) of MOEA Foxconn Technology Co., Ltd. $ 7,363,628 $ 20,864,243 $ -

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

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

• (2) Through investing in Q-Run Holdings Ltd. or Foxconn Precision Components Holding Co., Ltd., which then invested in Mainland China.

• (3) Others.

• Note 2: Investment income (loss) recognised by the Company for the year ended December 31, 2021 was recognised based on the audited financial statements of the investees in Mainland China for the same period.

• Note 3: Pursuant to the amended ‘Guidelines Governing the Review of Investment or Technical Cooperation in the Mainland Area’ dated on December 30, 2020, 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 from October 27, 2021 to October 26, 2024. Note 4: The Company needs no approval by Investment Commission of the Ministry of Economic Affairs for investment in Qingdao Hiyn Materials Co., Ltd., Fuzhun Precision (Shenyang) Industry Co., Ltd., Fuyu Technology (Nanyang) Co., Ltd. and Champ Tech Optical (Foshan) Corporation which were reinvestedthrough an existing company in Mainland China.

Table 8, Page 2

Foxconn Technology Co., Ltd. and Subsidiaries Major shareholders information December 31, 2021

Table 9

Name of major shareholders	Shares held as at June 30,2021
	Number of shares	Ownership (%)
Hon Hai Precision Industry Co., Ltd. Bao Xin International Investment Co., Ltd. Hung Yang Venture Investment Co., Ltd.	139,725,801 126,181,274 85,003,766	9.87 8.92 6.00