FTC - Audit Report / Information 2021

FOXCONN TECHNOLOGY CO., LTD.

PARENT COMPANY ONLY FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS’

REPORT

DECEMBER 31, 2021 AND 2020

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

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INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

Financial Review No. 21004399 (2022)

To the Board of Directors and Stockholders of Foxconn Technology Co., Ltd.

Opinion

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

In our opinion, the accompanying parent company only financial statements present fairly, in all material respects, the financial position of Foxconn Technology Co., Ltd as of December 31, 2021 and 2020, and its financial performance and its cash flows for the years then ended in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers”.

Basis for opinion

We conducted our audit of the parent company only financial statements as of and for the year ended December 31, 2021 in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and generally accepted auditing standards in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the parent company only financial statements section of our report. We are independent of the Group in accordance with the Norm of Professional Ethics for Certified Public Accountants of the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

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

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Key audit matters for the Company’s parent company only financial statements of the year ended December 31, 2021 are stated as follows:

Revenue cutoff

Description

Refer to Note 4(26) for accounting policy on revenue recognition and Note 6(18) for details of revenues.

The Company has three revenue 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 control of the products is transferred). The supporting documents for 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 the physical inventory quantities in the hubs and the quantities as reflected in accounting records.

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

How our audit addressed the matter

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

Evaluated and tested the Company’s internal controls over revenue recognition.
Tested sales transactions that took place shortly before and after the balance sheet date by verifying the customers’ receipt notes, supporting documents provided by hub custodian, and inventory movement records, and ascertained whether cost of goods sold was recognized in the correct reporting period.
Confirmed physical inventory quantities held by distribution warehouses and agreed to accounting records. Assessed the reasonableness of reconciling items identified through confirmation, if any and inspected related supporting documents and rationale.

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The Company and Investments accounted for under equity method/subsidiaries – Provision for inventory valuation losses

Description

Refer to Note 4(12) for accounting policies on inventory valuation, Note 4(13) for accounting policies on investments accounted for under equity method/subsidiaries and associates, Note 5 foruncertainty of accounting estimates and assumptions in relation to inventory valuation losses, and Notes6(5) and 6(6) for details of inventories and investments accounted for under equity method.

The Company is primarily engaged in the sales of 3C electronic products manufactured by its subsidiaries. Due to rapid technological innovations, short electronic product life cycles and fluctuations in market prices, there is a higher risk of inventory losses arising from market value decline or obsolescence. The Company and its subsidiaries recognize inventories at the lower of cost and net realizable value which is determined based on historical data of inventory closeout. Inventory valuation losses are provided against inventory aged over a certain time period and individually identified as obsolete or damaged. Provision for inventory valuation losses is recognized under “inventory” and “investments accounted for under equity method – subsidiaries” in the parent company only financial statements.

As the amounts of the Company and its subsidiaries’ inventory are material, types of inventories vary, the identification of obsolete or damaged inventories and determination of net realizable value are subject to management and audit judgement, we consider provision for inventory valuation losses as a key audit matter.

How our audit addressed the matter

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

Ensured consistent application of accounting policies on provision for inventory valuation losses and ascertained compliance with respective accounting guidance.
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 categorization in inventory aging report.

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Assessed the reasonableness of inventory valuation losses through discussion with management as to the determination of net realizable value of obsolete or damaged inventories and validated related supporting documents.

Responsibilities of management and those charged with governance for the parent company only financial statements

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

In preparing the parent company only financial statements, management is responsible for assessing the Company’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 Company 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 Company’s financial reporting process.

Auditor’s responsibilities for the audit of the parent company only financial statements

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

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

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We also:

Identify and assess the risks of material misstatement of the parent company only financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
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 Company’s internal controls.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
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 Company’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 parent company only 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 Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the parent company only financial statements, including the disclosures, and whether the parent company only financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the parent company only financial statements. We are responsible for the direction, supervision and performance of the audit. We remain solely responsible for our audit opinion.

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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 parent company only financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s 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.

Jackie, Feng Hsu, Chien-Ju

For and on behalf of PricewaterhouseCoopers, Taiwan March 22, 2022

------------------------------------------------------------------------------------------------------------------------------------------------The accompanying parent company only 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 parent company only 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. PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2021 AND 2020

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

Assets	December 31, 2021 AMOUNT % `$` `7,722,861` `5` `-` `-` `14,380,345` `9` `1,008,853` `-` `3,264,168` `2` `2,784,832` `2` `14,667` `-` `29,175,726` `18` `14,451` `-` `4,769,394` `3` `123,558,137` `79` `70,576` `-` `286` `-` `121,222` `-` `34,315` `-` `8,000` `-` `128,576,381` `82` `$` `157,752,107` `100`	December 31, 2020	December 31, 2020
	AMOUNT `$` `7,722,861` `-` `14,380,345` `1,008,853` `3,264,168` `2,784,832` `14,667` `29,175,726` `14,451` `4,769,394` `123,558,137` `70,576` `286` `121,222` `34,315` `8,000` `128,576,381` `$` `157,752,107`	AMOUNT `$` `2,341,791` `4,337` `15,696,185` `579,018` `2,141,747` `2,423,129` `13,783` `23,199,990` `-` `2,007,916` `123,097,456` `71,220` `1,315` `120,983` `73,479` `8,000` `125,380,369` `$` `148,580,359`	%
Current assets 1100 Cash and cash equivalents 1110 Current financial assets at fair value through profit or loss 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 1550 Investments accounted for using equity method 1600 Property, plant and equipment 1755 Right-of-use assets 1760 Investment property, net 1840 Deferred tax assets 1900 Other non-current assets 15XX Total non-current assets 1XXX Total assets			`2` `-` `11` `-` `1` `2` `-`
			`16`
			`-` `1` `83` `-` `-` `-` `-` `-`
			`84`
			`100`

(Continued)

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FOXCONN TECHNOLOGY CO., LTD. PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2021 AND 2020

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

Liabilities and Equity	December 31, 2021 AMOUNT % `$` `21,466,600` `14` `-` `-` `1,768,200` `1` `17,353,689` `11` `4,733,204` `3` `817,420` `1` `290` `-` `135,050` `-` `46,274,453` `30` `292,017` `-` `-` `-` `40,265` `-` `332,282` `-` `46,606,735` `30` `14,144,852` `9` `7,538,805` `5` `13,201,705` `8` `-` `-` `70,485,119` `44` `5,774,891` `4` `111,145,372` `70` `$` `157,752,107` `100`	December 31, 2020	December 31, 2020
	AMOUNT `$` `21,466,600` `-` `1,768,200` `17,353,689` `4,733,204` `817,420` `290` `135,050` `46,274,453` `292,017` `-` `40,265` `332,282` `46,606,735` `14,144,852` `7,538,805` `13,201,705` `-` `70,485,119` `5,774,891` `111,145,372` `$` `157,752,107`	AMOUNT `$` `14,518,000` `214,420` `2,352,892` `16,086,768` `3,706,830` `830,262` `689` `111,779` `37,821,640` `408,950` `638` `33,634` `443,222` `38,264,862` `14,144,852` `7,527,365` `12,731,133` `-` `68,602,338` `7,309,809` `110,315,497` `$` `148,580,359`	%
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 Share capital 3110 Ordinary share Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3320 Special reserve 3350 Unappropriated retained earnings Other equity interest 3400 Other equity interest 3XXX Total equity Significant Subsequent Events 3X2X Total liabilities and equity			`10` `-` `2` `11` `2` `1` `-` `-`
			`26`
			`-` `-` `-`
			`-`
			`26`
			`9` `5` `9` `-` `46` `5`
			`74`
			`100`

The accompanying notes are an integral part of these parent company only financial statements.

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FOXCONN TECHNOLOGY CO., LTD. PARENT COMPANY ONLY 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	Year ended December 31	Year ended December 31
	2021	2020 % AMOUNT `100` `$` `78,290,566` `95) (` `74,418,416) (` `5` `3,872,150` `- (` `213,569)` `- (` `247,212)` `1) (` `343,975) (` `1) (` `804,756) (` `4` `3,067,394` `-` `13,119` `-` `34,379` `- (` `119,085)` `- (` `120,554)` `2` `2,497,760` `2` `2,305,619` `6` `5,373,013` `1) (` `654,670) (` `5` `$` `4,718,343` `- ($` `15,784)` `-` `736,543` `1` `1,526,103` `-` `3,157` `1` `2,250,019` `2) (` `1,736,264) (` `4` `$` `5,232,098` `3.17` `$` `3.16` `$`	2020
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 7070 Share of profits of associates and joint ventures accounted for using equity method 7000 Total non-operating income and expenses 7900 Profit before income tax 7950 Tax expense 8200 Profit Components of other comprehensive income that will not be reclassified to profit or loss 8311 Actuarial losses on defined benefit plans 8316 Unrealised loss on valuation of financial assets at fair value through other comprehensive income 8330 Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will not be reclassified to profit or loss 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8310 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 8500 Total comprehensive income Earnings per share (in dollars) 9750 Basic earnings per share 9850 Diluted earnings per share
	`$`		`$`

The accompanying notes are an integral part of these parent company only financial statements.

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FOXCONN TECHNOLOGY CO., LTD. PARENT COMPANY ONLY 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 Total comprehensive income Appropriations and distribution of 2019 earnings Legal reserve Special reserve Cash dividends Changes in equity of 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 Total comprehensive income Appropriations and distribution of 2020 earnings Legal reserve Cash dividends Changes in equity of associates and joint ventures accounted for using equity method Disposal of equity instruments at fair value through other comprehensive income Balance at December 31, 2021	Notes		Share capital - common stock	Total capital surplus, additional paid-in capital	Total capital surplus, additional paid-in capital				Retained Earnings		Other equity interest	Other equity interest		Total equity
							Legal reserve		Special reserve	Total unappropriated retained earnings (accumulated deficit)	Financial statements translation differences of foreign operations	Unrealised gains (losses) from financial assets measured at fair value through other comprehensive income
	6(16) 6(6) 6(16) 6(6)		`$` `14,144,852` `-` `-` `-` `-` `-` `-` `-` `$` `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` `$` `68,602,338` `4,488,906` `(` `5,566 )` `4,483,340` `(` `470,572 )` `(` `2,546,073 )` `-` `416,086` `$` `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` `-` `(` `2,546,073` `)` `11,440` `-` `$ 111,145,372`

The accompanying notes are an integral part of these parent company only financial statements.

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FOXCONN TECHNOLOGY CO., LTD.

PARENT COMPANY ONLY 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
Adjustments to reconcile profit (loss)
Depreciation (including investment property)

Expected credit loss (gain)

Interest expense
Share of profits of associates and joint ventures accounted for
using equity method

Net loss (gain) on financial assets or liabilities at fair value
through profit or loss
Gain on disposal of property, plant and equipment
Dividend income

Interest income

Changes in operating assets and liabilities
Changes in operating assets
Accounts receivable, net
Accounts receivable due from related parties
Other receivables
Inventories
Changes in operating liabilities
Accounts payable
Accounts payable to related parties
Other payables
Other current liabilities
Cash inflow (outflow) generated from operations
Income taxes paid
Net cash flows from (used in) operating activities
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
Net (increase) decrease in financial assets at amortised cost-
current
Acquisition of property, plant and equipment

Proceeds from disposal of property, plant and equipment

Other current assets
Interest received
Dividends received
Net cash flows (used in) from investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in short-term loans
Cash dividends paid

Interest paid
Other non-current liabilities
Payments of lease liabilities
Net cash flows from (used in) financing activities
Net increase (decrease) 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
$
5,166,158 $
5,373,013
6(22)
3,473
4,950
12(2)
(
372 )
1,324
86,225
120,554
6(6)
(
1,807,719 ) (
2,497,760 )
(
210,083 )
121,602
(
13 )
1,536
6(20)
(
53,082 ) (
15,341 )
6(19)
(
2,365 ) (
13,119 )
1,316,258 (
5,309,814 )
(
429,881 )
326,419
(
1,292 ) (
117,408 )
(
361,703 ) (
2,000,816 )
(
584,692 )
464,746
1,266,921
456,221
(
99,698 )
92,594
23,271
6,441
4,311,406 (
2,984,858 )
(
766,472 ) (
628,924 )
3,544,934 (
3,613,782 )
(
14,451 )
-
(
2,532,766 )
-
-
3,457,000
6(7)
(
4,301 ) (
2,998 )
6(7)
590
545
(
884 )
772
2,365
29,444
64,017
22,210
(
2,485,430 )
3,506,973
6,948,600 (
267,129 )
6(16)
(
2,546,073 ) (
3,536,213 )
(
80,320 ) (
115,865 )
(
327 ) (
838 )
(
314 ) (
683 )
4,321,566 (
3,920,728 )
5,381,070 (
4,027,537 )
2,341,791
6,369,328
$
7,722,861 $
2,341,791

The accompanying notes are an integral part of these parent company only financial statements.

~12~

FOXCONN TECHNOLOGY CO., LTD. NOTES TO THE PARENT COMPANY ONLY FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 2020 AND 2019

(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 is primarily engaged in manufacturing, processing and sales of case, heat dissipation modules and consumer electronics products.

2. THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE FINANCIAL STATEMENTS AND PROCEDURES FOR AUTHORIZATION

The accompanying parent company only financial statements were authorized for issuance by the Board of Directors on March 22, 2022.

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:

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

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

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New Standards,Interpretations andAmendments	Effective date by International Accounting StandardsBoard
Amendments to IFRS 3, ‘Reference to the conceptual framework’ Amendments to IAS 16, ‘Property, plant and equipment: proceeds before intended use’ Amendments to IAS 37, ‘Onerous contracts— cost of fulfilling a contract’ Annual improvements to IFRS Standards 2018–2020	January 1, 2022 January 1, 2022 January 1, 2022 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’ Amendments to IFRS 17, 'Insurance contracts' Amendment to IFRS 17, 'Initial application of IFRS 17 and IFRS 9 – comparative information' 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

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’
Amendments to IFRS 17, 'Insurance contracts'
Amendment to IFRS 17, 'Initial application of IFRS 17 and IFRS 9 –
comparative information'
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 Company’s financial condition and financial performance based on the Company’s assessment.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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

(1) Compliance statement

The accompanying parent company only financial statements of the Company have been prepared in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers”.

(2) Basis of preparation

A. Except for the following items, the accompanying parent company only financial statements have

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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 Company’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the accompanying parent company only financial statements are disclosed in Note 5.

(3) Foreign currency translation

The accompanying parent company only financial statements are presented in New Taiwan dollars, which is the Company’s functional and 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 company, 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

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loss as part of the gain or loss on sale.

(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 Company 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.

(4) 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.

(5) Cash equivalents

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

(6) 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 Company subsequently measures the financial assets at fair value, and recognizes the gain or loss in profit or loss.
D. The Company recognizes the dividend income when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Company and the amount of the dividend can be measured reliably.

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

A. Financial assets at fair value through other comprehensive income comprise equity securities which are not held for trading, and for which the Company has made an irrevocable election at initial recognition to recognize changes in fair value in other comprehensive income and debt instruments which meet all of the following criteria:
(a) The objective of the Company’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 Company measures the financial assets at fair value plus transaction costs. The Company 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.

(8) Accounts and notes receivable

A. Accounts and notes receivable entitle the Company 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.

(9) Impairment of financial assets

For debt instruments measured at fair value through other comprehensive income and financial assets at amortized cost including accounts receivable or contract assets that have a significant financing component, at each reporting date, the Company 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 Company recognizes the impairment provision for lifetime ECLs.

(10) Derecognition of financial assets

The Company derecognizes a financial asset when the contractual rights to receive the cash flows from the financial asset expires.

– (11) Leasing agreements (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.

(12) Inventories

Inventories are stated at the lower of cost and net realizable value. Cost is determined using the

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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 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.

(13) Investments accounted for under equity method / subsidiaries and associates

A. Subsidiary is an entity where the Company has the right to dominate its finance and operation policies (includes special purpose entity), normally the Company owns more than 50 percent of the voting rights directly or indirectly in that entity. Subsidiaries are accounted for under the equity method in the Company's parent company only financial statements.
B. Unrealized gains or losses resulted from inter-company transactions with subsidiaries are eliminated. Necessary adjustments are made to the accounting policies of subsidiaries, to be consistent with the accounting policies of the Company.
C. After acquisition of subsidiaries, the Company recognizes proportionately for the share of profit and loss and other comprehensive incomes in the income statement as part of the Company's profit and loss and other comprehensive income, respectively. When the share of loss from a subsidiary exceeds the carrying amount of Company's interests in that subsidiary, the Company continues to recognize its shares in the subsidiary's loss proportionately.
D. Associates are all entities over which the Company 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.
E. The Company’s share of its investements’ 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 Company’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Company does not recognize further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the associate.
F. When changes in an associate’s equity do not arise from profit or loss or other comprehensive income of the associate and such changes do not affect the Company’s ownership percentage of the associate, the Company recognizes change in ownership interests in the associate in ‘capital surplus’ in proportion to its ownership.
G. Unrealized gains on transactions between the Company and its associates are eliminated to the extent of the Company’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 Company.
H. According to “Rules Governing the Preparations of Financial Statements by Securities Issuers”, 'profit for the year' and 'other comprehensive income for the year' reported in an entity's parent company only statement of comprehensive income, shall equal to 'profit for the year' and 'other comprehensive income' attributable to owners of the parent reported in that entity's consolidated statement of comprehensive income. Total equity reported in an entity's parent company only financial statements, shall be equal to the equity attributable to owners of parent reported in that entity's consolidated financial statements.
(14) Property, plant and equipment
A. Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during the

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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 Company and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognied. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.
C. Land is not depreciated. Other property, plant and equipment apply cost model and are depreciated using the straight-line method to allocate their cost over their estimated useful lives. Each part of an item of property, plant, and equipment with a cost that is significant in relation to the total cost of the item must be depreciated separately.
D. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each financial year-end. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in estimate under IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and 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.

(15) 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 Company. For short-term leases or leases of low value 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 Company 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.

(16) 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.

(17) Impairment of non-financial assets

The Company assesses at each balance sheet date the recoverable amounts of those assets where

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

(18) Loans

A. Loans comprise long-term and short-term bank loans and other long-term and short-term loans. Loans are recognized initially at fair value, net of transaction costs incurred. Loans are subsequently stated at amortized cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognized in profit or loss over the period of the borrowings using the effective interest method.
B. Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalized as a prepayment for liquidity services and amortized over the period of the facility to which it relates.
(19) 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.

(20) 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 Company measures the financial liabilities at fair value. All related transaction costs are recognized in profit or loss. The Company subsequently measures these financial liabilities at fair value with any gain or loss recognized in profit or loss.

(21) Derecognition of financial liabilities

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

(22) 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.

(23) Employee benefits

A. Short-term employee benefits

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

B. Pensions

(a) Defined contribution plan

For defined contribution plan, the contributions are recognized as pension expenses when

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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 plan
- i. Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employees will receive on retirement for their services with the Company in current period or prior periods. The liability recognized in the balance sheet in respect of defined benefit pension plan 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 plan are recognized in other comprehensive income in the period in which they arise and are recorded as retained earnings.
- iii. Past service costs are recognized immediately in profit or loss.
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 .

(24) 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 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, except where the timing of the reversal of the temporary difference is controlled by the Company 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

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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.

(25) 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.

(26) Revenue recognition

A. The Company 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 Company 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 Company 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.

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

The preparation of the accompanying parent company only financial statements requires management to make critical judgements in applying the Company’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 Company’s accounting policies

Revenue recognition

The Company determines whether the nature of its performance obligation is to provide the specified goods or services itself (i.e. the Company is a principal) or to arrange for the other party to provide those goods or services (i.e. the Company is an agent) based on the transaction model and its economic substance. The Company is a principal if it controls a promised good or service before it transfers the good or service to a customer. The Company recognizes revenue at gross amount of

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consideration to which it expects to be entitled in exchange for those goods or services transferred. The Company is an agent if its performance obligation is to arrange for the provision of goods or services by another party. The Company recognizes revenue at the amount of any fee or commission to which it expects to be entitled in exchange for arranging for the other party to provide its goods or services. Indicators that the Company controls the good or service before it is provided to a customer include the following:

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

A. The Company is primarily responsible for the provision of goods or services;
B. The Company 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 Company 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 Company must determine the net realizable value of inventories on balance sheet date using judgements and estimates. Due to the rapid technology innovation, the Company 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 Note 6(5).

6. DETAILS OF SIGNIFICANT ACCOUNTS

(1) Cash and cash equivalents

Checking accounts and demand deposits

December 31, 2021 December 31, 2020 $ 7,722,861 $ 2,341,791

A. The Company 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. The Company has no cash and cash equivalents pledged to others.

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

Assets December 31, 2021 December 31, 2020 Current items: Financial assets mandatorily measured at fair value through profit or loss Derivatives $ - $ 4,337 Non-current items: Financial assets mandatorily measured at fair value through profit or loss Debt instruments $ 14,451 $ - Liabilities Current items: Financial liabilities mandatorily measured at fair value through profit or loss Derivatives $ - $ 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	`86,215)` `($`	`($`	`526,647)`

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

Derivative instruments Current items: Foreign exchange contracts Forward exchange contracts	December31,2020
	Contract period TWD (SELL) `4,526,106` 2020/03~2021/03 USD (BUY) `152,000` USD (SELL) `4,000` 2020/11~2021/03 CNH (BUY) `27,174` (Nominal Principal inthousands) Contract amount

(a) Forward exchange contracts

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

i. Business activity: The payables due from importing 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 loans.

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(b) Foreign exchange contracts
- The Company 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 Company are all banks with good credit quality or financial institutions with investment grade credit ratings that are above A.
D. The Company 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 December 31, 2021 December 31, 2020

Non-current items:

Equity instruments $ 4,769,394 $ 2,007,916

A. The Company has elected to classify equity instruments that are considered to be strategic investments as financial assets at fair value through other comprehensive income.
B. The Board of Directors of the Company 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.
C. The Company recognized other comprehensive gains of $228,711 and $736,543 for fair value change for the years ended December 31, 2021 and 2020, respectively.
D. The Company has no financial assets at fair value through other comprehensive income pledged to others.

(4) Accounts receivable

Accounts receivable Less: Allowance for uncollectible accounts `(`	December31,2021 December31,2020 `14,384,571` `$` `15,700,830` `$` `4,226)` `4,645)` `(` `14,380,345` `$` `15,696,185` `$`

A. The Company does not hold any collateral as security.
B. Information relating to credit risk is provided in Note 12(2).

(5) Inventories

The cost of inventories recognized as expense for the year: December31,2021 Finished goods `2,800,561` `$` Less: Allowance for inventory obsolescence and market price decline `15,729)` `(` `(` `2,784,832` `$` 2021 Cost of inventories sold `77,530,218` `$`	December31,2020 `2,438,858` `$` `15,729)` `2,423,129` `$` 2020 `74,418,416` `$`

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(6) Investments accounted for using equity method

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Investees 2021 2020
At January 1 $ 123,097,456 $ 120,816,539
Share of profit of investments accounted for using
equity method 1,807,719 2,497,760
Dividends distributed by investments accounted for
( 10,935) ( 6,869)
using equity method
Change in capital surplus 11,440 187
-
Change in retained earnings 416,086
Change in other equity interest (Note 6(17)) ( 1,763,629) ( 210,161)
At December 31 $ 123,558,137 $ 123,097,456
December 31, 2021 December 31, 2020
Subsidiaries $ 123,282,735 $ 122,819,878
Associates 275,402 277,578
$ 123,558,137 $ 123,097,456
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A. The Company’s subsidiary:
(a) Details of the Company’s subsidiaries are provided in Note 4(3) of the Company’s consolidated financial statements as of and for the year ended December 31, 2021.
(b) The Company’s investments in China through FOXCONN PRECISION COMPONENTS HOLDING CO., LTD. and Q-RUN HOLDINGS LTD. are engaged in the production and sales of computer components (computer radiators, magnesium alloys and computer components). Please refer to Note 13 for the disclosure of information on investments in China.
B. The Company’s associates:

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

ummarized below:
Total comprehensive loss for the year `(`	2021 2020 `10,898)` `$` `18,887)` `($` Years ended December31,
	2021 `10,898)` `$` `(`

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(7) Property, plant and equipment

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2021
Buildings Machinery
and and
Land structures equipment Others Total
At January 1
Cost $ 51,850 $ 57,915 $ 81,038 $ 77,774 $ 268,577
-
Accumulated depreciation ( 44,633) ( 78,798) ( 73,926) ( 197,357)
$ 51,850 $ 13,282 $ 2,240 $ 3,848 $ 71,220
Opening net book amount
as at January 1 $ 51,850 $ 13,282 $ 2,240 $ 3,848 $ 71,220
Additions - 2,409 - 925 3,334
Transfer out - ( 1,233) - - ( 1,233)
- - -
Disposals ( 577) ( 577)
-
Depreciation ( 690) ( 373) ( 1,105) ( 2,168)
Closing net book amount
as at December 31 $ 51,850 $ 13,768 $ 1,867 $ 3,091 $ 70,576
At December 31
Cost $ 51,850 $ 57,237 $ 81,038 $ 78,122 $ 268,247
-
Accumulated depreciation ( 43,469) ( 79,171) ( 75,031) ( 197,671)
$ 51,850 $ 13,768 $ 1,867 $ 3,091 $ 70,576
----- End of picture text -----

~27~

						2020
			Buildings		Machinery
				and		and
		Land	structures		equipment			Others		Total
At January 1
Cost	`$`	`51,850`	`$`	`54,108`	`$`	`81,038`	`$`	`76,857`	`$`	`263,853`
Accumulated depreciation		`-`	`(`	`41,874)`	`(`	`78,425)`	`(`	`71,575)`	`(`	`191,874)`
	`$`	`51,850`	`$`	`12,234`	`$`	`2,613`	`$`	`5,282`	`$`	`71,979`
Opening net book amount
as at January 1	`$`	`51,850`	`$`	`12,234`	`$`	`2,613`	`$`	`5,282`	`$`	`71,979`
Additions								`2,998`		`2,998`
Transfer in		`-`		`1,581`		`-`				`1,581`
Disposals		`-`				`-`	`(`	`2,081)`	`(`	`2,081)`
Depreciation		`-`	`(`	`533)`	`(`	`373)`	`(`	`2,351)`	`(`	`3,257)`
at December 31	`$`	`51,850`	`$`	`13,282`	`$`	`2,240`	`$`	`3,848`	`$`	`71,220`
At December 31
Cost	`$`	`51,850`	`$`	`57,915`	`$`	`81,038`	`$`	`77,774`	`$`	`268,577`
Accumulated depreciation		`-`	`(`	`44,633)`	`(`	`78,798)`	`(`	`73,926)`	`(`	`197,357)`
	`$`	`51,850`	`$`	`13,282`	`$`	`2,240`	`$`	`3,848`	`$`	`71,220`

－
(8) Leasing arrangements lessee
A. The Company leases various assets including buildings and structures. Rental contracts are typically made for a period of 5 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose covenants, but leased assets may not be used as security for borrowing purposes.
B. Low-value assets comprise multifunction printers.
C. The carrying amount of right-of-use assets and the depreciation charge are as follows:

Buildings and structures Buildings and structures	December31,2021 December31,2020 Bookvalue Bookvalue `286` `$` `1,315` `$` 2021 2020 Depreciationexpense Depreciationexpense `311` `$` `686` `$` Years ended December 31,	December31,2020
		Bookvalue
		Depreciationexpense
		`686` `$`

D. For the year ended December 31, 2021, and 2020, there was no additions to right-of-use assets.
E. Information on profit or loss in relation to lease contracts is as follows:

~28~

Items affecting profit or loss Interest expense on lease liabilities Expense on short-term lease contracts Expense on leases of low-value assets	Year ended Year ended December31,2021 December31,2020 `4` `$` `16` `$` `6,554` `1,118` `48` `75`

F. For the year ended December 31, 2021, and 2020, the Company’s total cash outflow for leases were $6,920 and $1,892, respectively.
(9) Leasing arrangements - lessor
A. The Company leases various assets including buildings. Rental contracts are typically made for a periods of 4 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 Company recognized rent income in the amount of $19,640 and $18,722, respectively, based on the operating lease agreement, which does not include variable lease payments.
C. The maturity analysis of the lease payments under the operating leases is as follows:

2022 2023 2024 2025 2026	December 31, 2021 `18,999` `$` 2021 `5,193` 2022 `1,074` 2023 `1,031` 2024 `1,031` 2025 `27,328` `$`	December 31, 2020
		`15,649` `$` `14,978` `4,425` `1,074` `258`
		`36,384` `$`

The rent income recognized by the Company 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 each of the balance sheet dates.

~29~

(10) Investment property

==> picture [474 x 554] intentionally omitted <==

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

2021
Buildings and
Land structures Total
At January 1
Cost $ 95,910 $ 62,777 $ 158,687
-
Accumulated depreciation and impairment ( 37,704) ( 37,704)
$ 95,910 $ 25,073 $ 120,983
Opening net book amount as at January 1 $ 95,910 $ 25,073 $ 120,983
Transfer in - 1,233 1,233
-
Depreciation ( 994) ( 994)
Closing net book amount as at December 31 $ 95,910 $ 25,312 $ 121,222
At December 31
Cost $ 95,910 $ 65,864 $ 161,774
-
Accumulated depreciation and impairment ( 40,552) ( 40,552)
$ 95,910 $ 25,312 $ 121,222
2020
Buildings and
Land structures Total
At January 1
Cost $ 95,910 $ 66,584 $ 162,494
-
Accumulated depreciation and impairment ( 38,923) ( 38,923)
$ 95,910 $ 27,661 $ 123,571
Opening net book amount as at January 1 $ 95,910 $ 27,661 $ 123,571
Transfer out - ( 1,581) ( 1,581)
-
Depreciation ( 1,007) ( 1,007)
Closing net book amount as at December
31 $ 95,910 $ 25,073 $ 120,983
At December 31
Cost $ 95,910 $ 62,777 $ 158,687
-
Accumulated depreciation and impairment ( 37,704) ( 37,704)
$ 95,910 $ 25,073 $ 120,983
----- End of picture text -----

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

~30~

Rental income from investment property Direct operating expenses arising from the investment property that generated rental income during the year	2021 2020 `19,640` `$` `18,722` `$` `994` `$` `1,007` `$` Years ended December31,

B. The fair value of the investment property held by the Company as of December 31, 2021 and 2020 was $743,594 and $708,791, respectively. Valuations were made using the income approach which is categorized within Level 3 in the fair value hierarchy.

(11) Short-term loans

Short-term loans
Other payables Type of loans December 31, 2021 Bank loans Unsecured loans `21,466,600` `$` Type of loans December 31, 2020 Bank loans Unsecured loans `14,518,000` `$` Payable for purchases made by parties on behalf of others Employees’ compensation payable Awards and salaries payable Others	Interest rate range	Collateral
	0.41%~0.77% Interestraterange	None Collateral
	0.48%~0.80% December 31, 2021 `3,236,021` `$` `1,059,977` `316,777` `116,954` `4,729,729` `$`	None December 31, 2020
		`2,013,001` `$` `1,296,708` `266,194` `130,927` `3,706,830` `$`

(12) Other payables

(13) Pensions

A. Defined benefit plan

(a) The Company has a defined benefit pension plan in accordance with the Labor Standards Law, covering all regular employees’ service years prior to the enforcement of the Labor Pension Act on July 1, 2005 and service years thereafter of employees who chose to continue to be subject to the pension mechanism under the Law. Under the defined benefit pension plan, two units are accrued for each year of service for the first 15 years and one unit for each additional year thereafter, subject to a maximum of 45 units. Pension benefits are based on the number of units accrued and the average monthly salaries and wages of the last 6 months prior to retirement. The Company contributes monthly an amount equal to 2% of the employees’ monthly salaries and wages to the retirement fund deposited with Bank of Taiwan, the trustee, under the name of the independent retirement fund committee.

~31~

(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)`

Balance at January 1 Past service cost Interest income Remeasurements Return on plan assets (Note) Change in demographic assumptions Change in financial assumptions Experience adjustments Pension fund contribution Paid pension Balance at December 31			2021
	Present value of defined benefit obligations `67,933)` `($` `972)` `(` `238)` `(` `69,143)` `(` `-` `4,072)` `(` `2,634` `6,005)` `(` `7,443)` `(` `-` `2,184` `(` `2,184` `(` `($ 74,402)`		Fair value of Net defined plan assets benefit liability `34,299` `$` `33,634)` `($` `-` `972)` `(` `123` `115)` `(` `34,422` `34,721)` `(` `486` `486` `-` `4,072)` `(` `-` `2,634` `-` `6,005)` `(` `486` `6,957)` `(` `1,413` `1,413` `2,184)` `-` `771)` `1,413` `$ 34,137` `40,265)` `($`

~32~

2020

Present value of
defined benefit
obligations
Balance at January 1
57,744)
($
Past service cost
528)
(
Interest income
462)
(
58,734)
(
Remeasurements
Return on plan assets (Note)
-

Change in demographic
assumptions
567)
(
Change in financial assumptions
2,833)
(
Experience adjustments
13,650)
(
17,050)
(
Pension fund contribution
-
Paid pension
7,851
(
7,851
(
Balance at December 31
($ 67,933) Fair value of
Net defined
plan assets
benefit liability
39,056
$
18,688)
($
-
528)
(
319
143)
(
39,375
19,359)
(
1,266
1,266

-
567)
(
-
2,833)
(
-
13,650)
(
1,266
15,784)
(
1,509
1,509
7,851)

-
6,342)

1,509
$ 34,299
33,634)
($

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

(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 asset 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	Years endedDecember31,	Years endedDecember31,
	2021 `0.75%` `2.00%`	2020
		`0.35%`
		`2.00%`

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

~33~

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

s as follows:
Discount	rate	Future salary	increases
Increase	Decrease	Increase	Decrease
0.25%	0.25%	0.25%	0.25%

December 31, 2021 Effect on present value of defined benefit obligation $ 1,680 ($ 1,733) ($ 1,666) $ 1,623 December 31, 2020 Effect on present value of defined benefit obligation $ 1,603 ($ 1,657) ($ 1,585) $ 1,542 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 Company for the year ending December 31, 2022 are $1,800.

B. Defined contribution plan
- (a) Effective July 1, 2005, the Company has established a defined contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular employees with R.O.C. nationality. Under the New Plan, the Company contributes monthly an amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment.
- (b) The pension costs under the defined contribution pension plan of the Company for the years ended December 31, 2021 and 2020 were $15,915 and $12, 332, respectively.
(14) 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 outstanding ordinary shares of 1,414,485 thousand shares with a par value of $10 (in dollars) per share.

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

At January 1 (December 31)	2021 Number of ordinary shares(in thousands) `1,414,485`	2020
		Number of ordinary shares (in thousands)
		`1,414,485`

(15) 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

~34~

legal reserve is insufficient.

(16) 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 dividend policy, the proposal of earnings appropriation is prepared by the Board of Directors and resolved 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 authorizeded 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 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:

Years endedDecember31,	Years endedDecember31,	Years endedDecember31,
Dividends per Dividends per Amount share(in dollars) 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	2019
Amount `470,572` `$` `-` `2,546,073` `3,016,645` `$`		Dividends per share(in dollars)
		`2.5` `$`

The appropriations of earnings for 2021 as approved at the Board of Directors’ meeting as of March 22, 2022 is as follows:

~35~

		Years ended	December31,	December31,
		2021
				Dividends per
		Amount		share (in dollars)
Legal reserve	`$`	`489,943`
Cash dividends		`2,404,625`	`$`	`1.7`
	`$`	`2,894,568`

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

(17) Other equity items

System” of the TWSE. 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)`	`$`	`7,309,809`
Revaluation of fair value					`-`
- Parent		`228,711`			`-`		`228,711`
- Subsidaries		`298,951`			`-`		`298,951`
Sale transferred to
retained earnings	`(`	`416,086)`				`(`	`416,086)`
Currency translation
- Parent and subsidaries		`-`	`(`		`1,646,494)`	`(`	`1,646,494)`
At December 31	`$`	`15,284,218`	`($`		`9,509,327)`	`$`	`5,774,891`

~36~

2020

(18)
(19) Operating revenue
The Company derives revenue from the transfer of goods and services at a point in time in the
following categories:
Interest income
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
-

- Parent
736,543
-

736,543
- Subsidaries
1,526,103
-
1,526,103
Currency translation
- Parent and subsidaries
-

1,736,264)
(
1,736,264)
(
At December 31
15,172,642
$
7,862,833)
($
7,309,809
$
2021
2020
Revenue from contracts with customers
81,795,768
$
78,290,566
$
Years ended December 31,
Electronic products
trading services
Others
Total
Revenue from contracts with
customers
81,593,052
$
202,716
$
81,795,768
$
Electronic products
trading services
Others
Total
Revenue from contracts with
customers
78,136,849
$
153,717
$
78,290,566
$
Year ended December 31, 2021
YearendedDecember31,2020
2021
2020
Interest income from bank deposits
2,365
$
13,119
$
Years ended December31,

~37~

(20) Other income

Other income
		Years ended December31,
		2021		2020
Dividend income	`$`	`53,082`	`$`	`15,341`
Rental income		`19,640`		`18,722`
Others		`4,546`		`316`
	`$`	`77,268`	`$`	`34,379`
Other gains and losses
		Years ended	December31,
		2021		2020
Gains on financial assets (liabilities) at fair
value through profit or loss	`($`	`86,215)`	`($`	`526,247)`
Net currency exchange gains		`118,475`		`409,903`
Others	`(`	`1,280)`	`(`	`2,741)`
	`$`	`30,980`	`($`	`119,085)`

(21) Other gains and losses

Information related to gains (losses) on financial assets at fair value through profit or loss is provided in Note 6(2).

(22) Expenses by nature

in Note 6(2). Expenses by nature
Employee benefit expense Depreciation (Note)	Years ended December31,
	2021 `796,702` `$` `3,473` `800,175` `$`	2020
		`795,221` `$` `4,950`
		`800,171` `$`

Note: Including depreciation of investment property and right-of-use assets.

(23) Employee benefit expense

Employee benefit expense
Wages and salaries Labor and health insurance fees Pension costs Other personnel expenses	Years endedDecember31,
	2021 `702,241` `$` `34,552` `17,002` `42,907` `796,702` `$`	2020
		`716,847` `$` `24,230` `13,003` `41,141`
		`795,221` `$`

A. According to the Company’s Articles of Incorporation, if the Company accrues profit (referring to profit before tax prior to deducting the appropriation for 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 year ended December 31, 2021, the employees’ compensation was estimated and accrued based on 4% of profit of current year distributable as of the end of reporting period. Employees’ compensation for the years ended December 31, 2021 and 2020 as resolved by the Board of Directors were in agreement with the amounts recognized in the 2021 and 2020 financial statements. For the years ended December 31, 2021 and 2020, the employees’

~38~

compensation were distributed in the form of cash amounting to $215,257 and $223,876, respectively.

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.

(24) Income tax

A. Components of income tax expense:

Stock Exchange. ome tax Components of income tax expense:
			Years endedDecember31,
			2021			2020
Current tax:
Current tax on profits for the year	`$`		`683,392`		`$`	`571,093`
Tax on undistributed surplus earnings			`84,454`			`142,094`
Prior year income tax (over) under estimation	`(`		`14,216)`			`41,247`
Total current tax			`753,630`			`754,434`
Deferred tax:
Origination and reversal of temporary
differences Income tax expense	`(` `$`		`76,378)` `677,252`	`(`	`$`	`99,764)` `654,670`
Reconciliation between income tax expense and accounting			profit:
			Years ended	December31,
			2021			2020
Tax calculated based on profit before tax and
statutory tax rate		`$`	`1,033,233`		`$`	`1,074,603`
Tax effects of unrecognised deferred tax assets	`(`		`426,219)`	`(`		`603,274)`
Tax on undistributed earnings			`84,454`			`142,094`
Prior year income tax (over) under estimation	`(`		`14,216)`			`41,247`
Income tax expense			`677,252`			`654,670`
Origination and reversal of temporary differences			`76,378`			`99,764`
Prior year income tax over (under) estimation			`14,216`	`(`		`41,247)`
Prior year income tax payable			`49,855`			`120,000`
Prepaid income tax	`(`		`281)`	`(`		`2,925)`
Current income tax liabilities		`$`	`817,420`		`$`	`830,262`

B. Reconciliation between income tax expense and accounting profit:

~39~

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

							2021
							Recognized
				Recognized				in other
						in profit	comprehensive
		January1				or loss		income	December31
Temporary differences:
Deferred tax assets:
Reserve for inventory
obsolescence	`$`		`3,146`		`$`	`-`	`$`	`-`	`$`	`3,146`
Permanent loss
on market value decline of
long-term equity investments			`16,222`			`-`		`-`		`16,222`
Unused compensated absences for
employees			`4,428`			`889`		`-`		`5,317`
Unrealised loss on financial
instruments			`42,017`	`(`		`42,017)`		`-`		`-`
Others			`7,666`			`573`		`1,391`		`9,630`
	`$`		`73,479`	`($`		`40,555)`	`$`	`1,391`	`$`	`34,315`
Deferred tax liabilities:
Foreign investment income using
equity method	`($`		`346,075)`		`$`	`54,058`	`$`	`-`	`($`	`292,017)`
Others	`(`		`62,875)`			`62,875`		`-`		`-`
	`($`		`408,950)`		`$`	`116,933`	`$`	`-`	`($`	`292,017)`

~40~

January1
Temporary differences:
Deferred tax assets:
Reserve for inventory
obsolescence
3,146
$
Permanent loss
on market value decline of
long-term equity investments
16,222
Unused compensated absences for
employees
3,540
Unrealised loss on financial
instruments
17,696
Others
4,677

(
45,281
$
Deferred tax liabilities:
Foreign investment income using
equity method
442,655)
($
Others
41,018)
(
(
483,673)
($ Recognized
Recognized
in other
in profit
comprehensive
or loss
income
December31
-
$
-
$
3,146
$
-
-
16,222
888
-
4,428
24,321
-
42,017
168)

3,157
7,666
25,041
$
3,157
$
73,479
$
96,580
$
-
$
346,075)
($
21,857)

-
62,875)
(
74,723
$
-
$
408,950)
($
2020

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. Abovementioned taxable temporary differences arose from the differences between 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 earnings and thus, did not recognize deferred income tax liabilities.

E. The Company’s income tax returns through 2019 have been assessed and approved by the Tax Authority while the income tax return of 2018 has not been assessed and approved.

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(25) Earnings per share

Earnings per share
Basic earnings per share Net income Diluted earnings per share Net income Assumed conversion of all dilutive potential ordinary shares Employees’ compensation Net income plus assumed conversion of all dilutive potential ordinary shares Basic earnings per share Net income Diluted earnings per share Net income Assumed conversion of all dilutive potential ordinary shares Employees’ compensation Net income plus assumed conversion of all dilutive potential ordinary shares	Weighted average number of ordinary Earnings Amount shares outstanding per share after tax (shares in thousands) (in dollars) `4,488,906` `$` `1,414,485` `3.17` `$` `4,488,906` `$` `-` `4,053` `4,488,906` `$` `1,418,538` `3.16` `$` YearendedDecember31,2021 Weighted average number of ordinary Earnings Amount shares outstanding per share after tax (shares in thousands) (in dollars) `4,718,343` `$` `1,414,485` `3.34` `$` `4,718,343` `$` `-` `5,991` `4,718,343` `$` `1,420,476` `3.32` `$` YearendedDecember31,2020
		`3.34` `$`
		`3.32` `$`

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7. RELATED PARTY TRANSACTIONS

(1) Names of related parties and relationship

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Names of related parties Relationship with the Company
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LATED PARTY TRANSACTIONS Names of related parties and relationship Names of related parties	Relationship withthe Company
Hon Hai Precision Industry Co., Ltd. and Subsidiaries	Entity with significant influence to
(Hon Hai and Subsidiaries)	the Company
Hongfujin Precision Electronics (Yantai) Co., Ltd.	`〞`
Pan-International Industrial Corporation and Subsidiaries	Other related party
Innolux Corporation	`〞`
Sharp Corporation and Subsidiaries	`〞`
General Interface Solution Limited	`〞`
Ennoconn Corporation and Subsidiaries	`〞`
CyberTAN Technology, Inc. and Subsidiaries	`〞`
SIO International Holdings Limited Taiwan Branch	`〞`

For more information about the Company and other subsidiaries, please refer to Note 7.

(2) Significant related party transactions

A. Sales

nificant related party transactions Sales
Sales of goods and services: Entities with significant influence to the Company Subsidiaries Other related parties	Years endedDecember31,
	2021 `1,344,340` `$` `385,851` `4,890` `1,735,081` `$`	2020
		`848,925` `$` `469,439` `34,004`
		`1,352,368` `$`

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. Management service revenue (shown as ‘operating revenue’)

C. Purchases Management service revenue: Subsidiaries	Years endedDecember31,	Years endedDecember31,
	2021 `197,403` `$`	2020
		`153,717` `$`

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Purchases of goods and services: Entities with significant influence to the Company -Hon Hai and Subsidiaries Subsidiaries Other related parties	2021 2020 `64,092,451` `$` `64,633,599` `$` `5,187,703` `4,492,814` `7,102,713` `5,441,003` `76,382,867` `$` `74,567,416` `$` Years endedDecember31,

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

D. Receivables from related parties

days. Receivables from related parties
Accounts receivable: Entities with significant influence to the Company Subsidiaries Other related parties Less: Allowance for uncollectible accounts `(`	December31,2021 `560,587` `$` `448,426` `-` `1,009,013` `160)` `(` `1,008,853` `$`	December31,2020
		`397,483` `$` `180,682` `966` `579,131` `113)` `579,018` `$`

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. No allowance for doubtful debts was provided against receivables from related parties.

E. Payables to related parties

Payables to related parties
Accounts payable: Entities with significant influence to the Company -Hon Hai and Subsidiaries Subsidiaries Other related parties	December31,2021 December 31, 2020 `15,136,393` `$` `14,263,356` `$` `1,239,707` `1,097,490` `977,589` `725,922` `17,353,689` `$` `16,086,768` `$`
		`14,263,356` `$` `1,097,490` `725,922` `16,086,768` `$`

The payables to related parties arise mainly from purchase transactions and are made at arm’slength, non-interest bearing and payable within 30~90 days.

F. Raw materials purchased on behalf of others

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Raw materials purchased on behalf of others Entities with significant influence to the Company Other related parties Receivable for raw materials purchased on behalf of others (shown as‘other receivables’) Entities with significant influence to the Company Other related parties	Years endedDecember31,	Years endedDecember31,
	2021 `34,732,572` `$` `2,693,649` `37,426,221` `$` December31,2021 `2,878,773` `$` `372,609` `3,251,382` `$`	2020 `33,297,650` `$` `1,839,924` `35,137,574` `$` December31,2020 `1,394,124` `$` `736,129` `2,130,253` `$`

G. Lease transactions – lessee
(a) The Company leases plant from entities with significant influence to the Company. Rental contracts are typically made for a period of 5 years. Rents are paid at the beginning of each month.

(b) Lease liabilities:

i. Outstanding balance:

nth. ase liabilities: Outstanding balance:
Current: Entities with significant influence to the Company Non-current: Entities with significant influence to the Company	December31,2021 `290` `$` `-` `$`	December31,2020
		`689` `$`
		`638` `$`

Current:

Entities with significant influence to the Company Non-current:

ii. Interest expense

Interest expense Company	`-`
Entities with significant influence to the Company	Year ended December31,2021 `4` `$`	Year ended December31,2020
		`16` `$`

(3) Key management compensation

Key management compensation Entities with significant influence to the Company `$`	`4` `16` `$`	`4` `16` `$`
Salaries and other short-term employee benefits Post-employment benefits Share-based payments	Years endedDecember31,
	2021 `26,477` `$` `560` `38,665` `65,702` `$`	2020
		`36,162` `$` `524` `33,912`
		`70,598` `$`

8. PLEDGED ASSETS

None.

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9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACT

COMMITMENTS

None.

10. SIGNIFICANT DISASTER LOSS

None.

11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE

(a) The Company 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. (b) As of March 22, 2022, the Company’s Board of Directors has approved the proposal for the appropriation of earnings in 2021, which can be referred to in Note 6(16).

12. OTHERS

(1) Capital management

The Company’s objectives when managing capital are to safeguard the Company’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 Company may adjust the amount of dividends paid to shareholders, issue new shares or sell assets to reduce debt. The Company monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including “current and noncurrent borrowings” as shown in the consolidated balance sheet) less cash and cash equivalents. Total capital is calculated as “equity” as shown in the consolidated balance sheet less total intangible assets.

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

(2) Financial instruments

A. Financial instruments by category

Please refer to Note 6 and the balance sheet for the information related to the financial assets (financial assets at fair value through profit or loss, financial assets at fair value through other comprehensive income, cash and cash equivalents, accounts receivable (including related parties), other receivables and guarantee deposits paid) and financial liabilities (short-term loans, financial liabilities at fair value through profit or loss, accounts payable (including related parties), other payables and lease liabilities) of the Company.

B. Risk management policies
(a) Risk categories

The Company 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.

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  - iii. The Company’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 Company’s financial position and financial performance.

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

(c) Management system:
- i. Risk management is executed by the Company’s finance department by following policies approved by the Board. Through cooperation with the Company'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 Company 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 Company 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 Company has set up policies requiring the Company 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 parent company only financial statements, it is managed by the Company’s finance department.
iii. Sources of risk:
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 maturing in excess of three months, and U.S. dollar-denominated liabilities, such as loans, accounts payable and other payables, into New Taiwan dollars.

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:

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December 31, 2021

	Foreign
	currency				Degree
	amount	Exchange		Book value	of	Effect on
	(inthousands)	rate		(NTD)	variation	profit or loss
(Foreign currency:
functional currency)
Financial assets
Monetary items
USD`：`NTD	`928,011`	`27.68`	`$`	`25,687,344`	`1%`	`$`	`256,873`
Non-monetary items
Foreign operations
USD`：`NTD	`4,357,627`	`27.68`		`120,619,108`
Financial liabilities
Monetary items
USD`：`NTD	`776,706`	`27.68`		`21,499,222`	`1%`		`214,992`
		December31,2020
	Foreign
	currency				Degree
	amount	Exchange		Book value	of	Effect on
	(inthousands)	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`
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`
v. Total exchange gain, including realized and			Unrealized, arising		from significant foreign
exchange variation on the monetary items			held by the Company for the years ended
December 31, 2021 and 2020 amounted to $118,475 and $409,903, respectively.

Price risk

i. Nature

The Company primarily invests in domestic listed 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

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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 have been an increase/decrease of $47,694 and $20,079 for the years ended December 31, 2021and 2020, respectively.

Cash flow and fair value interest rate risk

The Company’s interest rate risk arises from short-term loans. Short-term loans with floating rates expose the Company 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 $16,266 and $6,757 for the years ended December 31, 2021 and 2020, respectively.

(b) Credit risk

Credit risk refers to the risk of financial loss to the Company arising from default by the clients or counterparties of financial instruments.

i. According to the Company’s credit policy, the Company 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 Company 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. The default occurs when the contract payments are past due over 90 days.
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;
(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) that were past due but not impaired is as follows:

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Not past due 0 to 90 days 91 to 180 days	December31,2021 `13,955,932` `$` `1,437,524` `128` `15,393,584` `$`	December31,2020 `16,264,630` `$` `15,331` `-` `16,279,961` `$`

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 from contracts with customers amounted to $11,296,566.
vi. The Company 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 Company’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 2020, the loss allowance for accounts receivable (including those from related parties), assessed using loss rate or provision matrix, is as follows:

December31,2021 Expected loss rate Total book value Allowance for uncollectible accounts December31,2020 Expected loss rate Total book value Allowance for uncollectible accounts	Group1 `0.027%` `14,837,174` `$` `4,100` `$` Group 1 `0.0285%` `15,543,058` `$` `4,391` `$`	Group2 `0.027%` `223,369` `$` `64` `$` Group2 `0.0285%` `320,745` `$` `91` `$`	Group 3 `0.063%` `244,530` `$` `163` `$` Group 3 `0.0665%` `227,712` `$` `151` `$`	Group4 `0.063%` `88,511` `$` `59` `$` Group4 `0.0665%` `188,446` `$` `125` `$`	Total
					`15,393,584` `$`
					`4,386` `$`
					Total
					`16,279,961` `$`
					`4,758` `$`

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.

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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	`$`	`4,758`
Gain on reversal of expected credit impairment loss	`(`	`372)`
At December 31	`$`	`4,386`
		2020
At January 1	`$`	`3,434`
Provision for impairment		`1,324`
At December 31	`$`	`4,758`

(c) Liquidity risk

i. Cash flow forecasting is performed by each of the operating entities of the Company and aggregated by Company treasury. Company treasury monitors rolling forecasts of the Company’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 Company does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. Such forecasting takes into consideration the Company’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 Company’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 and to the expected maturity date for derivative financial liabilities.
iii. Except for lease liabilities listed below, as of December 31, 2021 and 2020, the Company’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.

December 31, 2021 Non-derivative financial liabilities: Lease liability December 31, 2020 Non-derivative financial liabilities: Lease liability	Less than 1year `291` `$` 1year `699` `$`	Between 1 to2years `-` `$` to2years `641` `$`	Over 2years `-` `$` 2years `-` `$`	Total
				`291` `$`
				Total
				`1,340` `$`

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(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 Company’s investment in listed stocks is included in Level 1.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. The fair value of the Company’s investment in derivative instruments is included in Level 2.
Level 3: Unobservable inputs for the asset or liability. The fair value of the Company’s investment in stocks without active market, stocks with active market which are in the lockup period and convertible bonds is included in Level 3.
B. Fair value information of investment property at cost is provided in Note 6(10).
C. The related information of financial and non-financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets and liabilities is as follows:
(a) The related information on the nature of the assets and liabilities is as follows:

December 31, 2021 Level 1 Assets Recurring fair value measurements Financial assets at fair value through profit or loss Debt instruments `-` `$` Financial assets at fair value through other comprehensive income Equity instruments `2,854,279` `$`	Level3 `14,451` `$` `1,915,115` `$`	Total
		`14,451` `$`
Financial assets at fair value through profit or loss Debt instruments Financial assets at fair value through other comprehensive income Equity instruments
		`4,769,394` `$`

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==> picture [464 x 237] intentionally omitted <==

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

December 31, 2020 Level 1 Level 2 Level 3 Total
Assets
Recurring fair value measurements
Financial assets at fair value
through profit or loss
Derivative instruments $ - $ 4,337 $ - $ 4,337
Financial assets at fair value
through other comprehensive
income
Equity instruments $ 2,007,916 $ - $ - $ 2,007,916
Liabilities
Recurring fair value measurements
Financial liabilities at fair value
through profit or loss
Derivative instruments $ - $ 214,420 $ - $ 214,420
----- End of picture text -----

D. The methods and assumptions the Company used to measure fair value are as follows:
i. The instruments the Company 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. 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 Company 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.
iii. 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.
iv. The Company 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 Company’s credit quality.
E.

At January 1 Acquired in the period Gains and losses recognised in other comprehensive income `(` At December 31	2021 `-` `$` `2,547,216` `617,650)` `1,929,566` `$`

F. For the years ended December 31, 2021 and 2020, there was no transfer into or out from Level 1 to Level 2.
G. For the years ended December 31, 2021 and 2020, there was no transfer into or out from

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Level 3.

H. 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 equity interest of Modest Benefits Taiwan E Chain Co., Ltd. and H2U Corporation, respectively. 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 market price method.
I. The financial assets at fair value through profit or loss, categorized within Level 3, on December 31, 2021 pertain to the investment in convertible bonds of SOTERA WIRELESS, INC. 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 discounted cash flow method.

Fair value at December 31,2021 Non-derivative equity instrument: Lock-up period of listed shares 1,898,600 $ Unlisted shares 16,515 1,915,115 $ hybrid instrument Convertible Bonds 14,451 $	Valuation technique	Significant unobservableinput	Range (weighted average) Relationship of inputs to fair value
	Market price method Market price method Discounted Cash Flow	Discount for lack of marketability The latest capital increase price Discount rate	38.08% The higher the discount for marketability, the lower the fair value. $10~$55 Not applicable 14.84% The higher for the discount rate, the lower the fair value.

J. The Group has carefully assessed the valuation models and assumptions used to measure fair value. However, use of different valuation models or assumptions may result in different measurement. The following is the effect 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:

changed:
Financial assets Debt instruments Equity instruments	Input	Change `±1%` `±1%`		Favourable change Unfavourable change Favourable change Unfavourable change `1,358` `1,282)` `($` `-` `$` `-` `$` `-` `-` `$` `30,685` `$` `30,641)` `($` Recognized in profit or loss YearendedDecember31,2021 Recognized in other comprehensive income
			`$`	Favourable change Unfavourable change `1,358` `1,282)` `($` `-` `-` `$` Recognized in profit or loss
				Favourable change `1,358` `(` `-`
	Discount rate Discount for lack of marketability
			`$`

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

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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(21) and 12(3).
J. Significant inter-company transactions during the reporting periods: Please refer to table 6.

(2) Information on investees

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

(3) Information on investments in Mainland China

A. Basic information: Please refer to table 8.
B. Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area: Please refer to table 6.

(4) Information on major shareholders

Major shareholders information: Please refer to table 9.

14. SEGMENT INFORMATION

None.

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Foxconn Technology Co., Ltd. Loans to others

Table 1

Year ended December 31, 2021

Expressed in thousands of NTD (Except as otherwise indicated)

Reason for short-term financing Allowance for doubtful accounts Maximum outstanding balance during the year ended December 31,2019 Balance at December 31,2021 Actual amount drawn down No. Creditor Borrower General ledger account Is a relatedparty Interest rate Nature of loan Amount of transactions with the borrower	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

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

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 December31,2019
	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 〞〞〞 Convertible bonds of SOTERA WIRELESS, INC. 〞 Financial assets at fair value through profit or loss - non-current Huazhun Investment Co., Ltd. Common stock of Innolux Corporation 〞 Financial assets at fair value through other comprehensive income - non-current 〞 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. 〞〞〞 Common 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 0 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 1

Foxconn Technology Co., Ltd.

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

Year ended December 31, 2021

Table 3 Investor Marketable securities General ledger account Counterparty (Note 4) Relationship with the investor (Note 4)	Balance as at January1,2021	Addition	Disposal		Expressed in thousands of NTD (Except as otherwise indicated) Balance as at December 31,2021	Expressed in thousands of NTD (Except as otherwise indicated) Balance as at December 31,2021
	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 - -	RMB 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, 2

Table 3, Page 1

Foxconn Technology Co., Ltd.

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

Expressed in thousands of NTD (Except as otherwise indicated)

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 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 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	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	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 1

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 the Company 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 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 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	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	- $ - 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 2

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 counterparties of the investee are the investee of the Company accounted for using 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	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	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 3

Foxconn Technology Co., Ltd.

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

December 31, 2021

Table 5

Expressed in thousands of NTD (Except as otherwise indicated)

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
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. FOXCONN TECHNOLOGY PTE. 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 Other related parties 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 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 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 $ 2,878,773 (shown as other receivables)(Note 1) 120,032 (shown as other receivables)(Note 1) 252,577 (shown as other receivables)(Note 1) 383,302 5,736,389 147,255 2,182,721 209,437 318,248 106,782	2.78 Not applicable Not applicable Not applicable 1.33 1.23 2.04 2.76 1.84 4.47 4.81	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 1

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 2

Foxconn Technology Co., Ltd.

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 6 6 7	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. FOXCONN TECHNOLOGY PTE. LTD. 〝 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 1

Foxconn Technology Co., Ltd.

Information on investees

Year ended December 31, 2021

				Year ended December 31, 2021	Year ended December 31, 2021
Investor Table 7	Investee	Location	Main business activities	Initial investment amount		Sharesheld as atDecember		31,2021	Net profit (loss) of the investee for the year ended December 31,2021	Investment income (loss) recognised by the Company for the year ended December 31,2021 Note Expressed in thousands of NTD (Except as otherwise indicated)
				Balance as at December31,2021	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., Foreign Technology Ltd., Topfry Industrial Ltd., Gold Glory International Ltd., New Glory Holdings Ltd., FTP Technology Inc., Fu Rui Precision Components (Kunshan) Co., Ltd., Fuzhun Precision (Shenzhen) Industry Co., Ltd., Fuyu Technology (Nanyang) 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 1

Foxconn Technology Co., Ltd.

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 year ended December 31,2021	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the year ended December 31, 2021 (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 1

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 (Note 3) 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. SUMMARY OF CASH AND CASH EQUIVALENTS DECEMBER 31, 2021

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

Summary 1

Summary 1
Items Cash in banks Check deposits Demand deposits Foreign deposits USD 254,923 In thousands Exchange rate 27.68 JPY 34,792 In thousands Exchange rate 0.24 EUR 122 In thousands Exchange rate 31.32 HKD 3,934 In thousands Exchange rate 3.55 SGD 14 In thousands Exchange rate 20.46 RMB 614 In thousands Exchange rate 4.35 Description	Amount
	1,781 $ 635,709 7,056,257 8,368 3,817 13,960 294 2,675 7,722,861 $

Summary 1,Page1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF ACCOUNTS RECEIVABLE DECEMBER 31, 2021

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

Summary 2

Items PKM CORPORATION Others Less`：`Allowance for uncollectible accounts Accounts receivable from related parties Champ Tech Optical (Foshan) Corporation Hongfujin Precision Electroncis (Wuhan) Co., Ltd. Hongfujin Precision Electroncis (Yantai) Co., Ltd Others Less: Allowance for uncollectible accounts	Description Amount Remark 13,196,357 $ 1,188,214 Balance of individual customers is under 5% of this account's balance. 14,384,571 4,226) ( 14,380,345 $ 383,802 $ 335,802 111,662 177,747 Balance of individual customers is under 5% of this account's balance. 1,009,013 160) ( 1,008,853 $	Remark

Summary 2,Page1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF INVENTORY

DECEMBER 31, 2021

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

Summary 3

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

Amount
Items Summary Cost Market price Notes
Finished goods are
measured at net
Finished goods $ 2,207,555 $ 2,260,369 realizable value
Inventory in transit 593,006 593,006
2,800,561 $ 2,853,375
Less ： Provision for inventory valuation losse ( 15,729)
$ 2,784,832
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Summary 3,Page1

FOXCONN TECHNOLOGY CO., LTD. MOVEMENT SUMMARY OF INVESTMENTS ACCOUNTED FOR UNDER THE EQUITY METHOD FOR THE YEAR ENDED DECEMBER 31, 2021

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

Summary 4

Companyname	In thousand shares Amount 480,078 104,857,153 $ 135,840 15,966,879 125,478 1,995,846 49,032 277,578 123,097,456 $ As of January1,2021	In thousand shares Amount - 1,711,643 $ - 533,274 - 678,716 - - 2,923,633 $ Additions(Note 1)	In thousand shares Amount - 2,272,744) ($ - 177,097) ( - 10,935) ( - 2,176) ( 2,462,952) ($ Deductions(Note 2)	As	Ownership (%) Amount 100 104,296,052 $ 100 16,323,056 100 2,663,627 20 275,402 123,558,137 $ of December 31,2021	Market value or net	equiryvalue	Pledged as collateral
	In thousand shares 480,078 135,840 125,478 49,032	In thousand shares - - - -		In thousand shares 480,078 135,840 125,478 49,032	Ownership (%) 100 100 100 20	Totalprice 104,390,208 $ 16,323,056 2,663,627 252,527 123,629,418 $	Valuation basis Equity method `〃` `〃` `〃`
Q-RUN HOLDINGS LTD. FOXCONN PRECISION CONPONENTS HOLDING CO., LTD. HUAZHUN INVESTMENT CO., LTD. SYNTREND CREATIVE PARK CO., LTD.								None `〃` `〃` `〃`

Note 1: Additions include investment income accounted for using equity method, change in capital surplus and recognition of valuation adjustment for FVOCI financial assets loss on investees' financial instruments. Note 2: Deductions include investment loss accounted for using equity method, cash dividends received, change in capital surplus, recognition of valuation adjustment for FVOCI financial assets loss on investees'

financial instruments and exchange differences on translation of foreign financial statements.

(Remainder of page intentionally left blank)

Summary 4,Page1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF SHORT-TERM LOANS DECEMBER 31, 2021

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

Summary 5

Items Bank Unsecured bank loans Crédit Agricole Corporate and Investment Bank `〞` Citibank Taiwan Ltd. Taipei Branch `〞` Bank of Communications `〞` Sumitomo Mitsui Banking Corporation `〞` Mizuho Bank Taipei Branch `〞` China Construction Bank Taipei Branch `〞` DBS Bank (Taiwan) Ltd. `〞` The Bank of East Asia Limited `〞` Taipei Fubon Commercial Bank Co., Ltd `〞` E.Sun Bank (East Sanchung Branch) `〞` The Bank of Tokyo-Mitsubishi, Ltd.	Amount Term of Contract 2,500,000 $ 2021/10/14~2022/10/13 3,044,800 2021/12/03~2022/1/03 1,600,000 2021/12/17~2022/2/17 2,160,000 2021/11/17~2022/3/9 1,450,000 2021/10/28~2022/3/28 2,430,000 2021/12/10~2022/2/10 1,660,800 2021/12/7~2022/1/6 1,300,000 2021/12/20~2022/1/20 1,500,000 2021/10/13~2022/1/13 3,000,000 2021/12/30~2022/1/4 821,000 2021/11/10~2022/3/8 21,466,600 $	Rate 0.68% 0.41% 0.50% 0.50% 0.50% 0.50% 0.42% 0.50% 0.50% 0.77% 0.49%	Financing amount (In thousands) USD 250,000 USD 113,000 USD 102,290 NTD 2,600,000 USD 300,845 USD 180,010 USD 100,000 NTD 1,393,000 NTD 1,500,000 NTD 3,000,000 USD 167,757	Collateral Footnote None `〞` `〞` `〞` 〞〞〞〞〞〞〞

Summary 5,Page1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF ACCOUNTS PAYABLE FOR THE YEAR ENDED DECEMBER 31, 2021

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

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

Summary 6
Vendor Name Description Amount Notes
Accounts payable
Company C $ 265,526
Company W 165,431
Company G 116,187
Balance of individual
vendor is under 5% of this
Others 1,239,056 account's balance.
$ 1,786,200
Accounts payable to related parties
Hongfujin Precision Electroncis (Yantai) Co., Ltd $ 14,991,246
Balance of individual
vendor is under 5% of this
Others 2,362,443 account's balance.
$ 17,353,689
----- End of picture text -----

Summary 6,Page1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF OPERATING REVENUE FOR THE YEAR ENDED DECEMBER 31, 2021

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

Summary 7

Summary 7
Items Electronic products Others Less: Sales returns and discounts	Quantity (inthousands) Amount Note 83,393,048 $ 202,716 83,595,764 1,799,996) ( 81,795,768 $	Remark

Note: The number of products sold is varied and the units of pricing are different, so the quantity is not listed.

Summary 7,Page1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF OPERATING COSTS FOR THE YEAR ENDED DECEMBER 31, 2021

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

Summary 8

	Items		Amount
Add: Beginning finished goods			2,438,858
Acquisition of finished goods			77,841,007
Less: Ending finished goods	(		2,800,561)
Other operating costs			51,024
		$	77,530,328

Summary 8,Page1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF OTHER OPERATING COSTS FOR THE YEAR ENDED DECEMBER 31, 2021

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

Summary 9

Items Wages and salaries Labor and health insurance Pension Processing fee Others	Description	Amount Remark 22,308 $ 859 494 265 27,098 Balance of individual accounts is under 5% of this account's balance. 51,024 $	Remark

Summary 9,Page1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF SELLING EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2021

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

Summary 10

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

Items Description Amount Remark
----- End of picture text -----

Wages and salaries Freight Pension Others	137,884 $ 40,207 2,723 65,878 Balance of individual accounts is under 5% of this account's balance. 246,692 $

Summary 10,Page1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF GENERAL AND ADMINISTRATIVE EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2021

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

Summary 11

Items Description Amount Remark Wages and salaries $ 244,771 Other personnel expenses 7,775 Pension 5,803 Balance of individual accounts is under 5% of this account's Others 68,782 balance. $ 327,131

Summary 11,Page1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF RESEARCH AND DEVELOPMENT EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2021

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

Summary 12

Items Description Amount Remark Wages and salaries $ 300,753 Labor and health insurance 16,557 Pension 7,982 Balance of individual accounts is under 5% of this account's balance. Others 32,275 $ 357,567

Summary 12,Page1

FOXCONN TECHNOLOGY CO., LTD.

SUMMARY OF EMPLOYEE BENEFITS EXPENSES, DEPRECIATION AND AMORTIZATION BY FUNCTION FOR THE YEAR ENDED DECEMBER 31, 2021

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

Summary 13

Summary 13
By nature Employee benefits expenses (Note) Wages and salaries Labor and health insurance Pension Directors' compensation Others Depreciation Amortization		Year ended December31,2021		Total 705,606 $ 34,552 17,002 1,806 41,101 800,067 $ 3,473 $ - $		Year ended December31,2020
	Classified as Operating Costs 22,198 $ 859 494 - 1,049 24,600 $ 311 $ - $	Classified as Operating Expenses 683,408 $ 33,693 16,508 1,806 40,052 775,467 $ 2,168 $ - $	Classified as Non-operating Expenses - $ - - - - - $ 994 $ - $		Classified as Operating Costs 135,287 $ 5,042 3,106 - 8,070 151,505 $ 686 $ - $	Classified as Operating Expenses 581,560 $ 19,188 9,897 1,800 31,271 643,716 $ 3,257 $ - $	Classified as Non-operating Expenses - $ - - - - - $ 1,007 $ - $	Total
								716,847 $ 24,230 13,003 1,800 39,341
								795,221 $
								4,950 $
								- $

Note A: As of December 31, 2021 and 2020, the Company had 221 and 176 employees, respectively, including 5 non-employee directors for both years.

B. A company whose stock is listed for trading on the stock exchange or over-the-counter securities exchange shall additionally disclose the following information:
(a) Average employee benefit expense in current year was $3,696 ((Total employee benefit expense in current year - Total directors’ compensation in current year)/ (Number of employees in current year - Number of non-employee directors in current year)).
Average employee benefit expense in previous year was $4,640 ((Total employee benefit expense in previous year - Total directors’ compensation in previous year)/ (Number of employees in previous year - Number of non-employee directors in previous year)).
(b) Average employee salaries in current year was $3,267 (Total employee salaries in current year / (Number of employees in current year - Number of non-employee directors in current year)).
Average employee salaries in previous year was $4,192 (Total employee salaries in previous year / (Number of employees in previous year - Number of non-employee directors in previous year)).
(c) Adjustment of average employee salaries was (22%) ((Average employee salaries in current year - Average employee salaries in previous year)/ Average employee salaries in previous year).
(d) The compensation to supervisors was $0 for the years ended December 31, 2021 and 2020.

Summary 13,Page1

FOXCONN TECHNOLOGY CO., LTD.

SUMMARY OF EMPLOYEE BENEFITS EXPENSES, DEPRECIATION AND AMORTIZATION BY FUNCTION (Cont.) FOR THE YEAR ENDED DECEMBER 31, 2021

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

Summary 13

(e) The Company's compensation policies (including for board of directors, managers and employees)
(i) Compensation policy for board of directors: the distribution of compensation and travel allowance to directors (including independent directors) are made in accordance
with the “Rules for Distribution of Compensation to Directors” as approved by the board of directors. All directors received a fixed payment for compensation and travel allowance, and no variable payments were made.
(ii) Compensation policy for managers: the distribution of salaries to managers are made in accordance with the "Rules for Distribution of Remuneration to Managers", the Company's profit and loss statement for management, and their level of contribution. Timely reviews of the manager's remuneration program will be made in line with the actual operating conditions and the relevant laws and regulations. The remuneration program includes a base salary, a performance bonus, and an individual bonus. For base salaries, the Company takes into account the industry standards, job title, academic qualifications, experiences, professional competencies and job responsibilities The performance bonuses are allocated based on the level of contribution made by each operating segment to the profits earned by the Company. The individual bonus is based on the individual performance of each manager.
(iii) Compensation policy for employees: the distribution of compensation to the employees is based on the individual's capabilities, level of contribution to the company, individual's performance, the value of the role to the Company, and the projected future risks the Company will face. If the Company generates a profit in the current period,
4-6% of distributable profit shall be allocated as employees' bonus in accordance with the Company's Articles of Association. The bonus will be paid to each employee based on their performance.

Summary 13,Page2

AI assistant

FTC — Audit Report / Information 2021

52024_rns_2021-11-12_41594d7e-cad7-4d49-a389-3766fadebe17.pdf

FOXCONN TECHNOLOGY CO., LTD.

PARENT COMPANY ONLY FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS’

INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

Opinion

Basis for opinion

Key audit matters

Revenue cutoff

Description

How our audit addressed the matter

The Company and Investments accounted for under equity method/subsidiaries – Provision for inventory valuation losses

Description

How our audit addressed the matter

Responsibilities of management and those charged with governance for the parent company only financial statements

Auditor’s responsibilities for the audit of the parent company only financial statements

We also:

Jackie, Feng Hsu, Chien-Ju

FOXCONN TECHNOLOGY CO., LTD. PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2021 AND 2020

FOXCONN TECHNOLOGY CO., LTD. PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2021 AND 2020

FOXCONN TECHNOLOGY CO., LTD. PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2021 AND 2020

FOXCONN TECHNOLOGY CO., LTD. PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY YEARS ENDED DECEMBER 31, 2021 AND 2020

FOXCONN TECHNOLOGY CO., LTD.

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2021 AND 2020

FOXCONN TECHNOLOGY CO., LTD. NOTES TO THE PARENT COMPANY ONLY FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 2020 AND 2019

1. HISTORY AND ORGANIZATION

2. THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE FINANCIAL STATEMENTS AND PROCEDURES FOR AUTHORIZATION

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

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(1) Compliance statement

(2) Basis of preparation

(3) Foreign currency translation

(4) Classification of current and non-current items

(5) Cash equivalents

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

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

(8) Accounts and notes receivable

(9) Impairment of financial assets

(10) Derecognition of financial assets

– (11) Leasing agreements (lessor) operating leases

(12) Inventories

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

(16) Investment property

(17) Impairment of non-financial assets

(18) Loans

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

(21) Derecognition of financial liabilities

(22) Offsetting financial instruments

(23) Employee benefits

A. Short-term employee benefits

B. Pensions

(24) Income tax

(25) Dividends

(26) Revenue recognition

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

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

Revenue recognition

6. DETAILS OF SIGNIFICANT ACCOUNTS

(1) Cash and cash equivalents

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

(a) Forward exchange contracts

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

(4) Accounts receivable

(5) Inventories

(6) Investments accounted for using equity method

(7) Property, plant and equipment

(10) Investment property

(11) Short-term loans

(12) Other payables

(13) Pensions

A. Defined benefit plan

(15) Capital surplus

(16) Retained earnings

(20) Other income

(21) Other gains and losses

(22) Expenses by nature

(23) Employee benefit expense

(24) Income tax

FTC Audit Report / Information 2021

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

i. Nature `:`