GCE — Annual Report 2022

Nov 14, 2022

Stock Code: 2368

Gold Circuit Electronics Ltd. and the subsidiaries

Consolidated Financial Reports and Auditors’ Report 2022 and 2021

Address: No. 113, Xiyuan Road., Zhongli Industrial Park, Zhongli District, Taoyuan City 320, Taiwan (R.O.C.) Telephone: (03) 4612541

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TABLE OF CONTENTS

ITEM I. Cover page II. Table of Contents III. Declaration for Consolidated financial reports of Affiliated Companies III. Auditors’ Report V. Consolidated Balance Sheet VI. Consolidated Statements of Income VII. Consolidated Statements of Changes in Shareholders’ Equity VIII. Consolidated Statements of Cash Flow IX. Notes to Consolidated Financial Statements (I) Company History (II) Dates and Procedures for Approving Financial Statements (III) Applicability of newly promulgated and amended standard rules and interpretations (IV) Summary of Significant Accounting Policies (V) Major Sources of Major Accounting Judgments, Estimate and Hypotheses (VI) Notes to major accounting titles (VII) Transactions with Related Parties (VIII) Pledged Assets (IX) Important Matters (X) Information on Foreign Currency Assets and Liabilities with Major Impacts (XI) Notes to Disclosures 1. Information Related to Material Transactions 2. Information Related to Reinvested Enterprises 3. Information about Investment in Mainland China 4. Primary Shareholders Information (XII) Segment information

PAGE NO. NUMERATION OF NOTES TO FINANCIAL REPORTS 1 - 2 - 3 - 4-8 - 9 - 10-11 - 12 - 13-14 - 15 I 15 II 15-20 III 20-36 IV 36-37 V 37-76 VI-XXVII 76 XXVIII 76 XXIX 77 XXX 77-78 XXXI 78-79 XXXII - - - - - - - - 79 XXXIII

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Declaration on Consolidated Reports of Affiliates

Companies that should be included in the compiled consolidated financial reports of affiliates for 2022 (from January 1, 2022 to December 31, 2022) in accordance with the “Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises” are identical to those that should be compiled in the consolidated reports of the parent company and its subsidiaries as per International Financial Reporting Standard 10 and all the information that should be disclosed in the consolidated financial reports of affiliates has been disclosed in the consolidated reports of the parent company and its subsidiaries. Therefore, the consolidated financial reports of affiliates are not prepared separately.

Declared by:

Company: Gold Circuit Electronics Ltd.

Responsible Person: Cheng-Tse Yang

March 9, 2023

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CPAs’ Audit Report

For Review by Gold Circuit Electronics Ltd.,

Audit opinions

We have audited the accompanying balance sheet of Gold Circuit Electronics Ltd. and its subsidiaries (Gold Circuit Electronics Group) on December 31, 2022 and 2021 and the related consolidated statements of income, consolidated statements of changes in shareholders’ equity, consolidated statements of cash flow, and notes to the consolidated financial statements (including the material accounting policies summary) from January 1 to December 31, 2022 and 2021.

In our opinion, the major issues of said financial reports prove to have been duly worked out in accordance with and Regulations Governing the Preparation of Financial Reports by Securities Issuers, and the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), and International Financial Reporting Standards Interpretations Committee’s Interpretations (IFRSIC) and Standing Interpretation Committee’s Interpretative Announcement (SIC) recognized and issued into effect by the Financial Supervisory Commission, Executive Yuan (FSC), presenting fairly the consolidated financial position of Gold Circuit Electronics Group on December 31, 2022 and 2021 and the consolidated results of financial performance and consolidated cash flow for the periods starting from January 1 till December 31, 2022 and 2021.

Basis for the Audit Opinions

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial statements by Certified Public Accountants and auditing standards. Our responsibilities under those standards are further described in the responsibilities of auditors for the audit of the consolidated financial statements. The personnel of the CPA Firm subject to the independence requirement have acted independently from the business operations of Gold Circuit Electronics Group in accordance with the Code of Ethics and with other responsibilities

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of the Code of Ethics performed. We believed 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 determined by us as the CPAs based on our professionalism to be the most important in the audit of the 2022 consolidated financial reports of the Gold Circuit Electronics Group. These matters were addressed in the content of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on those matters.

The key audit matters for the 2022 consolidated financial reports of the Gold Circuit Electronics Group are described as follows:

Recognition of revenue

When the subsidiary in Mainland China actually ships goods, the inventory control is transferred and the income from the triangle trade of Gold Circuit Electronics Ltd. is recognized. Therefore, it is possible that improper recognition of income exists despite the absence of actual shipment. Therefore, we believe that there might be risk over whether such type of income occurs. Given this, it is classified as a key audit matter. The policy for recognition of revenue is disclosed in Note IV herein.

The audit procedure that we performed on the above-mentioned key matters primarily covers the following:

1. Understand and test the design and effectiveness of execution of the major internal control for recognition of revenue of the Company.

2. Samples were selected from the income statement of the triangle trade to verify how original purchase orders from customers were approved and to verify the shipping receipts and supporting documents from the subsidiary in Mainland China for confirmation over whether the transaction really occurred or not.

Other information

Gold Circuit Electronics Ltd. has duly worked out the 2022 and 2021 parent company-only financial reports for which we, as the CPAs, have issued the Audit Report containing unqualified opinions, with records on file, for your reference.

Responsibilities of Management and Those in Charge with Governance of the Consolidated Financial Statements

The responsibility of the management is to have the consolidated financial reports presented fairly, in all material respects, in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Firms”, and the International Financial Reporting Standards

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(IFRS), International Accounting Standards (IAS), International Financial Reporting Standards Interpretations Committee's Interpretations (IFRSIC) and Standing Interpretation Committee's Interpretative Announcement (SIC) recognized and issued into effect by the Financial Supervisory Commission, Executive Yuan (FSC), and also to maintain the necessary internal controls related to the consolidated financial reports to ensure that the consolidated financial reports are free of any material misstatement arising from fraud or errors.

In the preparation of the consolidated financial statements, the management’s responsibility also includes assessing the continuing operation of Gold Circuit Electronics Group, the disclosure of the relevant matters, and the adoption of the continuing operation accounting base, unless the management intends to liquidate Gold Circuit Electronics Group or cease business operation, or there is a lack of any option except for liquidation or suspension.

The governance unit (including the Audit Committee) of Gold Circuit Electronics Group is responsible for supervising the financial reporting process.

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

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

As part of an audit in accordance with the accounting principles in the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit. We also perform the following works:

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

2. Obtain the necessary understanding on the internal control related to the audit in order to design appropriate audit procedures under the circumstances, but the purpose is not to

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express an opinion on the effectiveness of the internal control of Gold Circuit Electronics Group.

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

2. Use the audit evidence obtained as the basis to draw conclusions on the suitability of the continuing operation accounting base adopted by the management and whether or not there are events or circumstances causing significant doubts regarding the continuing operation ability of Gold Circuit Electronics Group have significant uncertainties. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosure are inappropriate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of the auditor’s report. However, future events or circumstances may result in the inability of Gold Circuit Electronics Group to continue operating.

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

4. Obtain sufficient and appropriate audit evidence on the financial information of the Group in order to express an opinion on the consolidated financial statements. The independent auditor is responsible for guiding, supervising, and implementing the audit of the Group; also, is responsible for forming an opinion on the audit of the Group.

We communicate with those in charge of 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 in charge of 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).

We decided the key audit matters for the 2022 consolidated financial reports of the Gold Circuit Electronics Group from matters communicated on the governance unit. 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 communications.

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Deloitte & Touche CPA Chao-Ling Chen CPA Chun-Yi Chang

Financial Supervisory Commission’s Written Approval No. Jin-Guan-Zheng-Liu-Zi No.: 0930160267

Securities and Futures Commission’s written approval No: Tai-Cai-Zheng-Liu-Zi No. 0920123784

March 9, 2023

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Gold Circuit Electronics Ltd. and its subsidiaries

Consolidated Balance Sheet

December 31, 2022 and 2021

Unit: NTD thousand

Code 1100 1110 1150 1170 1200 130X 1410 1470 11XX 1535 1600 1755 1760 1780 1840 1900 15XX 1XXX Code 2100 2120 2150 2170 2200 2230 2250 2280 2320 2399 21XX 2540 2542 2570 2580 2640 2670 25XX 2XXX 3110 3200 3310 3320 3350 3300 3490 3500 31XX 3XXX	Assets Current assets Cash and cash equivalents (Notes IV and VI) Financial assets at fair value through profit or loss - current (Notes. IV and VII) Notes receivable (Notes IV and IX) Accounts receivable (Notes IV, V and IX) Other accounts receivable (Notes IV and IX) Inventories (Notes IV and X) Prepayments Other current assets (Note XVI) Total current assets non-current assets Financial assets measured at amortized cost - non-current (Note IV and VIII) Property, plant and equipment (Notes IV, XII and XXIII) Right-of-use assets (Notes IV, XIII and XXVIII) Investment property (Notes IV and XIV) Other intangible assets (Notes IV and XV) Deferred income tax assets (Notes IV and XXIV) Other non-current assets (Note XVI) Total non-current assets Total assets Liabilities and shareholders’equity Current liabilities Short-term borrowings (Notes IV and XVII) Financial liabilities measured at fair value through gains or losses - current (Notes IV and VII) Notes payable Accounts payable (Note XVIII) Other accounts payable (Note XIX) Income tax liability for the year (Note XXIV) Provision for liabilities-current (Notes IV and XX) Lease liabilities - current (Notes IV and XIII) Long-term borrowings due within a year (Notes IV and XVII) Other current liabilities (Note XIX) Total current liabilities Non-current liabilities Long-term borrowings (Notes IV and XVII) Long-term bills payable (Note IV and XVII) Deferred income tax liabilities (Notes IV and XXIV) Lease liabilities - non-current (Notes IV and XIII) Net defined benefit liabilities- non-current (Notes IV and XXI) Other non-current liabilities (Note XIX) Total non-current liabilities Total liabilities Equity attributable to owners of the Company (Note XXII) Capital stock Common stock Additional paid-in capital Retained earnings Legal reserve Special reserve Undistributed earnings Total retained earnings Other equity items Treasury stocks Total equity attributable to owners of the Company Total equity Total liabilities and equities		December 31, 2022	December 31, 2022	％ 20 - - 36 - 19 1 - 76 - 21 - 2 - 1 - 24 100 7 - - 19 9 2 1 - - 1 39 11 - 1 - - 1 13 52 16 4 2 2 23 27 1 - 48 48 100		December 31, 2021	December 31, 2021
			Amount $ 5,973,977 43,302 9,424 10,726,992 88,733 5,615,970 265,140 2,934 22,726,472 45,100 6,294,437 168,739 576,200 42,539 176,253 10,858 7,314,126 $ 30,040,598 $ 2,188,434 4,908 116 5,660,421 2,878,042 662,755 252,214 12,284 - 197,552 11,856,726 3,340,000 - 338,633 3,110 73,101 105,010 3,859,854 15,716,580 4,918,391 1,219,167 464,215 475,522 7,062,701 8,002,438 276,776 92,754) 14,324,018 14,324,018 $ 30,040,598				Amount $ 3,817,107 25,691 17,628 9,105,664 91,204 4,821,750 267,134 15,899 18,162,077 31,700 5,679,186 189,143 577,900 26,550 298,232 15,497 6,818,208 $ 24,980,285 $ 1,341,206 - - 5,502,050 2,469,318 402,785 179,552 17,246 253,142 108,933 10,274,232 1,624,108 1,250,000 135,795 15,300 200,680 78,056 3,303,939 13,578,171 5,464,879 1,206,574 167,997 475,522 3,927,668 4,571,187 257,951 98,477) 11,402,114 11,402,114 $ 24,980,285		％
		(				(			15 - - 37 1 19 1 - 73 - 23 1 2 - 1 - 27 100 5 - - 22 10 2 1 - 1 - 41 6 5 1 - 1 - 13 54 22 5 - 2 16 18 1 - 46 46 100

Notes to the consolidated financial reports constitute a part of these financial reports.

Chairman: Cheng-Tse Yang

Manager: Cheng-Tse Yang

Accounting Supervisor: Chang-Chin Yang

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Gold Circuit Electronics Ltd. and its subsidiaries

Consolidated Statements of Income

January 1 to December 31, 2022 and 2021

Unit: NTD thousand, yet the earnings per share is NTD

Code Operating income 4100 Sales income (Note IV) Operating cost (Notes X, XXI and XXIII) 5110 Sales cost 5900 Gross profit Operating expenses (Notes XXI and XXIII) 6100 Promotional expenditure 6200 Operating expenditure 6300 R&D expenditure 6450 Expected credit impairment loss (profit) 6000 Total operating expenses 6500 Other gains, expenses and losses - net (Note XXIII) 6900 Net operating profit Non-operating revenue and expense (Notes IV and XXIII) 7100 Interest revenue 7010 Other revenue 7020 Other gain or loss 7050 Financial cost 7000 Total non-operating revenue and expense		2022		％ 100 73 27 3 3 2 - 8 - 19 - - 1 - 1		2021
		Amount $ 32,785,064 24,056,976 8,728,088 963,997 983,518 718,228 39,549 2,705,292 13,916 6,036,712 62,826 93,608 285,502 90,315) 351,621						％
	(							100 76 24 3 3 3 - 9 - 15 - - - - -

(To be continued)

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(Continued)

(Continued)
Code 7900 Net profit before tax from continuing operation 7950 Income tax expenses (Notes IV and XXIV) 8000 Continuing operation net profit for the year Other comprehensive income 8310 Not reclassified to profit and loss: 8311 Defined benefit plan re-measurement amount (Note XXI) 8349 Incomes tax related to titles not subject to reclassification 8360 May be reclassified to profit and loss subsequently: 8361 Exchange differences on translation of foreign financial statements 8300 Other comprehensive income (net amount after tax) of the year 8500 Total comprehensive income of the year The net earnings belong to: 8610 Owners of the Company The total comprehensive income belongs to: 8710 Owners of the Company EPS (Note XXV) From continuing operations 9710 Basic 9810 dilution		2022		％ 20 6 14 - - - - 14 14 14		2021
								％
								15 4 11 - - - - 11 11 11

Notes to the consolidated financial reports constitute a part of these financial reports.

Chairman: Chen-Tse Yang Manager: Chen-Tse Yang Accounting Supervisor: Chang-Chin Yang

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Gold Circuit Electronics Ltd. and its subsidiaries

Consolidated Statements of Changes in Shareholders’ Equity

January 1 to December 31, 2022 and 2021

Unit: NTD thousand

Code A1 Balance as of January 1, 2021 Appropriation and distribution of earnings from 2020 B1 Legal reserve B5 The Company’s shareholder dividend in cash Change in other additional paid-in capital C15 Cash dividend assigned with capital reserve C17 Capital reserve - transaction of treasury stocks D1 Net profits of 2021 D3 Other combined gains or losses after tax of 2021 D5 Total combined gains or losses of 2021 Z1 Balance as of December 31, 2021 Appropriation and distribution of earnings from 2021: B1 Appropriation of legal reserve B5 The Company’s shareholder dividend in cash Other changes in capital reserve: C17 Capital reserve - transaction of treasury stocks D1 Net profits of 2022 D3 Other combined gains or losses after tax of 2022 D5 2022 Total comprehensive income E3 Capital reduction in cash Z1 Balance as of December 31, 2022						Equity attributable to owners of the Company	Equity attributable to owners of the Company	Equity attributable to owners of the Company	Equity attributable to owners of the Company	Equity attributable to owners of the Company	Equity attributable to owners of the Company				Treasury stocks $ 98,477 ) - - - - - - - 98,477 ) - - - - - - 5,723 $ 92,754)		Total equity
		Capital stock $ 5,464,879 - - - - - - - 5,464,879 - - - - - - 546,488) $ 4,918,391	Additional paid-in capital $ 1,471,233 - - ( 273,244 ) 8,585 - - - 1,206,574 - - 12,593 - - - - $ 1,219,167			Retained earnings			Undistributed earnings $ 1,679,970 167,997 ) 546,488 ) - - 2,926,854 35,329 2,962,183 3,927,668 296,218 ) 1,202,274 ) - 4,567,875 65,650 4,633,525 - $ 7,062,701			Other equity items	Property upward revaluation $ 295,781 - - - - - - - 295,781 - - - - - - - $ 295,781
											Exchange differences on translation of foreign financial statements $ 12,702 ) - - - - - 14,558) 14,558) 27,260 ) - - - - 18,825 18,825 - $ 8,435)	Unrealized gains or losses from financial assets measured at fair value through other combined gains or losses ( $ 10,570 ) - - - - - - - ( 10,570 ) - - - - - - - ($ 10,570)
					Legal reserve $ - 167,997 - - - - - - 167,997 296,218 - - - - - - $ 464,215		Special reserve $ 475,522 - - - - - - - 475,522 - - - - - - - $ 475,522
	(		(					( ( ( (		( ( ( ( (		( ( (		( ( (		( ( ( (	$ 9,265,636 - 546,488 ) 273,244 ) 8,585 2,926,854 20,771 2,947,625 11,402,114 - 1,202,274 ) 12,593 4,567,875 84,475 4,652,350 540,765) $ 14,324,018

Notes to the consolidated financial reports constitute a part of these financial reports.

Chairman: Chen-Tse Yang

Manager: Chen-Tse Yang

Accounting Supervisor: Chang-Chin Yang

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Gold Circuit Electronics Ltd. and its subsidiaries

Consolidated Statements of Cash Flow

January 1 to December 31, 2022 and 2021

Unit: NTD thousand

		Unit: NTD thousand
Code Cash flow from operating activities A10000 Net profit before tax for the year A20010 Income charges (credits): A20300 Expected credit impairment loss (interest from recovery of impairment) A20100 Depreciation expenditure A20200 Amortization expenditure A20900 Financial cost A29900 Provision for liabilities A21200 Interest revenue A21300 Dividend income A23800 Loss on inventory valuation falling and obsolescence (gain on recovery) A22500 Loss on disposal of property, plant and equipment A20400 Financial asset net interest measured at fair value through gains or losses A20400 Net loss (or gain) from financial liabilities measured at fair value through gains or losses A24100 Net profit (loss) of exchange in foreign currencies A24600 Loss (or gain) from fair value adjustment of investment property A30000 Net change in operating assets and liabilities A31130 Notes receivable A31150 Accounts receivable A31180 Other receivables A31200 Inventories A31230 Prepayments A31240 Other current assets A32140 Notes payable A32150 Accounts payable A32180 Other payables A32230 Other current liabilities A32240 Net defined benefit liabilities A33000 Cash yielded in business operation A33200 Interest collected A33500 Income tax paid AAAA Net cash generated by operating activities	2022 $ 6,388,333 39,549 858,157 16,225 90,315 72,512 ( 62,826 ) ( 124 ) 148,583 34,633 ( 17,611 ) 4,908 154,712 1,700 8,204 ( 1,661,394 ) 2,494 ( 943,444 ) 1,994 12,965 116 158,371 286,899 88,619 ( 45,517) 5,638,373 62,803 ( 1,257,427) 4,443,749	2021
		$ 4,048,518 ( 50,106 ) 762,815 12,901 67,464 23,540 ( 16,385 ) ( 54 ) ( 9,916 ) 44,197 ( 18,268 ) ( 13,804 ) ( 8,237 ) ( 900 ) 45,517 ( 2,344,994 ) 88,045 ( 1,732,708 ) 3,743 ( 55 ) - 1,660,676 440,886 33,633 ( 24,339) 3,012,169 16,400 ( 639,068) 2,389,501

(To be continued)

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(Continued)

(Continued)
Code Cash flow from investing activities B00040 Acquisition of financial assets measured at amortized cost B07600 Dividends collected B02700 Procurement of property, plant and equipment B04500 Procurement of intangible assets B02800 Proceeds from disposal of property, plant and equipment B03800 Decrease in refundable deposit B06700 Decrease in other non-current assets BBBB Net cash used in investing activities Cash flow from financing activities C00100 Increase in short-term loan C00200 Decrease in short-term loan C01600 Application for long-term loan C01700 Repayment of long-term loan C01800 Increase in long-term notes and bills payable C01900 Decrease in long-term-term notes payable C04020 Repayment of lease liability principal C03000 Collection of guarantee deposits received C05600 Interest paid C04500 Dividends in cash paid C04700 Capital reduction in cash CCCC Net cash used in financing activities DDDD Impact of change in exchange rate upon cash & cash equivalents EEEE Net Increase (decrease) in cash and cash equivalents E00100 Cash and cash equivalents, beginning of year E00200 Cash and cash equivalents, end of year	2022 ( $ 13,400 ) 124 ( 1,360,233 ) ( 2,412 ) 14,667 1,090 3,549 ( 1,356,615) 4,884,694 ( 3,999,391 ) 3,676,561 ( 2,322,891 ) - ( 1,250,000 ) ( 17,725 ) 26,954 ( 83,795 ) ( 1,189,681 ) ( 540,765) ( 816,039) ( 114,225) 2,156,870 3,817,107 $ 5,973,977	2021
		$ - 54 ( 825,948 ) ( 20,999 ) 15,333 74 399 ( 831,087) 2,868,571 ( 3,776,689 ) 7,635,374 ( 9,214,604 ) 1,250,000 - ( 21,831 ) 2,522 ( 72,512 ) ( 819,732 ) - ( 2,148,901) 22,635 ( 567,852 ) 4,384,959 $ 3,817,107

Notes to the consolidated financial reports constitute a part of these financial reports.

Chairman: Chen-Tse Yang Manager: Chen-Tse Yang Accounting Supervisor: Chang-Chin Yang

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Gold Circuit Electronics Ltd. and its subsidiaries

Notes to consolidated financial statement

January 1 to December 31, 2022 and 2021

(Expressed in Thousand New Taiwan Dollars, unless specified otherwise)

I. Company History

Gold Circuit Electronics Ltd. (GCE) was established in Jhongli Dist., Taoyuan City in September 1981, primarily engaged in manufacturing, processing and trading printed circuit boards.

The Company’s stocks have been traded on TWSE since March 1998.

The functional currencies adopted by the Company and its subsidiaries are NTD, CNY and USD respectively. Considering that the Company is a listed company based in Taiwan, in order to improve the comparability and consistency of the financial reports, the consolidated financial reports are denominated in NTD.

II. Dates and procedures for Approving Financial Statements

The parent company-only financial statements were approved by the Board of Directors on March 9, 2023.

III. Applicability of newly promulgated and amended standard rules and interpretations

(I) The first-time adoption of the IFRS, IAS, IFRIC, and SIC and effective upon promulgation by the Financial Supervisory Commission (“FSC”) (hereinafter referred to as the “IFRSs” collectively).

The application of the amended IFRSs that are approved and released to take effect by the FSC would not cause significant changes to the accounting policies of the Consolidated Company.

(II) Applicable IFRSs approved by the FSC in 2023.

the Consolidated Company. Applicable IFRSs approved by the FSC in 2023.
New promulgation/Amendment/Amended Rules and Interpretation Amendments to IAS 8 “Disclosure of Accounting Policies” Amendments to IAS 8 “Definition of Accounting Estimates” Amendment to IAS 12 “Deferred Tax related to Assets and Liabilities arising from a Single Transaction”	The effective date promulgated by IASB
	Sunday, January 1, 2023 (Note 1) Sunday, January 1, 2023 (Note 2) Sunday, January 1, 2023 (Note 3)

Note 1: The amendment is applicable during the annual reporting period that begins after January 1, 2023.

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• Note 2: The amendment is applicable to changes to accounting estimates and the accounting policy that occur during the annual reporting period that begins after January 1, 2023.

• Note 3: Except for the deferred income tax recognized of the temporary differences of lease and decommissioning obligation on January 1, 2022, the said amendment applies to transactions that occurred after January 1, 2022.

• Amendments to IAS 1 “Disclosure of Accounting Policies”

• The amendment specifies that the Consolidated Company shall follow

• the definition of “material” while deciding material accounting policy information that should be disclosed. If the accounting policy information can be reasonably expected to likely affect decisions made by main users of general-purpose financial statements based on the financial statements, such information is considered “material.” The amendment also clarifies that:

• The accounting policy information concerning non-material transactions, other matters, or conditions are considered non-material; the Consolidated Company does not need to disclose the said information.

• The Consolidated Company may determine if relevant accounting policy information is considered material based on the nature of the transactions, other matters, or conditions, even if the value involved is non-material.

• Not all accounting policy information relevant to material transactions, other matters, or conditions are considered material.

• In addition, the amendment explains through examples that accounting

• policy information may be considered material if it is relevant to material transactions, other matters, or conditions:

• (1) The Consolidated Company changed its accounting policies during the reporting period and the said changes resulted in material changes of information provided in financial statements.

• (2) The Consolidated Company chooses its applicable accounting policies from options allowed under the Standard.

• (3) The accounting policies are established by the Consolidated Company in compliance with IAS 8 “Accounting Policies, Changes in Accounting Estimates, and Errors” due to the lack of requirements of specific standards.

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• (4) The Consolidated Company discloses applicable accounting policies that are decided requiring utilization of material judgment or assumptions; or

• (5) Complicated accounting processing requirements are involved and users of the Financial Statement rely on such information in order to know the said material transactions, other matters, or conditions.

• Amendments to IAS 8 “Definition of Accounting Estimates”

The amendment specifies that accounting estimate refers to amount in currencies impacted by measurement uncertainties in financial statements. While applying accounting policies, it may be necessary for the Consolidated Company to measure items to be included in the financial statements with the amount in currencies that cannot be directly observed and hence needs to be estimated. As a result, it is required to fulfill this purpose by developing accounting estimates taking advantage of the measurement technique and the input value. If impacts of changes in the measurement technique and the input value on accounting estimates are not corrections of preceding errors, such changes are considered changes in accounting estimates.

1. Amendment to IAS 12 “Deferred Tax related to Assets and Liabilities arising from a Single Transaction”

The amendment clarifies that transactions of the same value generated and subject to taxation and for which temporary differences may be eliminated when initially recognized are not applicable under the waiver requirement initially recognized in IAS 12. The Consolidated Company would recognize deferred income tax assets (if its taxable income is likely to be available for deducting temporary differences) and deferred income tax liabilities of all temporary differences relevant to leases and decommissioning obligations that may be eliminated and are subject to taxation on January 1, 2022 and adjust the cumulative effects to be recognized as initial balance of retained earnings on that date. Transactions other than leases and decommissioning obligations, on the other hand, would be deferred in applying the said amendment on January 1, 2022 onwards.

Except for the impacts mentioned above, as of the date the consolidated financial reports were approved and released, the Consolidated Company had evaluated and determined that the amendments made to other standards and their

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interpretations will not significantly impact the financial standing and financial performance.

(III) IFRSs already published by the IASB but not yet recognized or issued into effect by the FSC.

the FSC.
New promulgation/Amendment/Amended Rules and Interpretation Amendments to IFRS 10 and IAS 28 “Assets sales or contribution between the investor and the affiliated company or joint venture.” Amendment to IFRS 16 "Lease Liabilities for Sale and Leaseback" IFRS 17 “Insurance Contract” Amendments to IFRS 17 Amendment to IFRS 17 “Initial Application of IFRS 17 and IFRS 9—Comparative Information” Amendments to IAS 1 “Classification of Liabilities as Current or Noncurrent” Amendment to IAS 1 “Non-current liabilities with contract terms and conditions"	The effective date promulgated by IASB (Note 1)
	To be determined Monday, January 1, 2024 (Note 2) Sunday, January 1, 2023 Sunday, January 1, 2023 Sunday, January 1, 2023 Monday, January 1, 2024 Monday, January 1, 2024

Note 1: Unless otherwise expressly remarked, the aforementioned new/Amendment/Amended Rules or Interpretation come into effect in the fiscal year starting from the respective specified effective dates.

Note 2: The seller and lessee shall retroactively apply the amendments to IFRS 16 for sale and leaseback transactions signed after the initial date of application of IFRS 16.

1. Amendments to IFRS 10 and IAS 28 “Assets sales or contribution between the investor and the affiliated company or joint venture.”

The amendment provides that if a consolidated company sells or contributes assets to affiliated companies (or joint ventures), or the consolidated company loses the control over a subsidiary but retains significant influence on the subsidiaries (or joint control), and if the aforementioned assets or subsidiary in compliance with the definition of a business under IFRS 3 “Business Combinations” the consolidated company is to recognize the profit and loss of the transactions fully.

In addition, if a Consolidated Company sells or contributes assets to affiliated companies (or joint ventures), or the Consolidated Company loses the control over a subsidiary in the trade with affiliated companies (or joint

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ventures) but retains significant influence on the subsidiaries (or joint control), and if the aforementioned assets or subsidiary not in compliance with the definition of IFRS 3 “Business,” the Consolidated Company is to recognize the profit and loss of the transactions only within the equity scope of the affiliated companies (or joint ventures) irrelevant to the investors, in other words, the profit and loss attributable to the Consolidated Company should be offset.

Amendments to IAS 1 “Classification of Liabilities as Current or Noncurrent” (amended in 2020) and “Non-current liabilities with contract terms and conditions” (amended in 2022)

The amendment in 2020 clarifies that in order to determine whether a liability should be classified as non-current, it is necessary to evaluate whether the Consolidated Company has the right to defer settlement of the liability for at least 12 months after the reporting period, at the end of the reporting period. If the Consolidated Company has such right at the end of the reporting period to defer settlement of the liability after the reporting period, the liability should be classified as noncurrent, irrelevant with whether the Consolidated Company is expected to exercise the right or not.

The amendment in 2020 also specifies that the Consolidated Company must have followed specific criteria when the reporting period ends if it is required for the Consolidated Company to follow specific criteria in order to be entitled to delay the pay-off of liabilities. This applies even if the lender tests if the Consolidated Company has followed the said criteria on a later date. The amendment in 2022 further clarified that only the contract terms that need to be followed before the end date of the reporting period would impact the classification of liabilities. Although the contract terms that need to be followed within 12 months after the reporting period do not impact the classification of liabilities, related information needs to be disclosed so that users of financial reports understand that the risk of the Consolidated Company possibly being unable to abide by contract terms and hence the need to pay back within 12 months after the reporting period.

The amendment in 2020 stipulates that for the purpose of liability categorization, the above-mentioned pay-off means the transfer of cash, other economic resources, or the equity tools of the Consolidated Company to the trading counterpart to result in disappearance of liabilities. Notwithstanding,

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where, according to the terms and conditions of liabilities, the liabilities might be paid off at the discretion of the trading counterpart through the transfer of the Consolidated Company’s equity instruments and said discretion is stated into equity separately under IAS 32 “Financial Instruments: Presentation,” the classification of liabilities would remain unaffected by said terms and conditions.

3. Amendments to IFRS 16 "Lease Liabilities for Sale and Leaseback"

The said amendment clarifies that if the transfer of assets fulfills the requirement of IFRS 15 “Revenue from Contracts with Customers” and hence is handled as sale of assets in after-sales leaseback transactions, the liabilities incurred because of the leaseback for the seller and lessee shall be handled as required for lease liabilities under IFRS 16. If the variable lease payment not determined by index or rate is involved, the seller and lessee shall weigh the liabilities in a way that losses/gains relevant to the retained right of use are not recognized. Later, the difference between the lease payment and the actual payment for the current term included in the calculation of lease liabilities is listed under gains or losses.

In addition to the impact referred to above, the Consolidated Company continued to assess the impact of the other standards and interpretation on the financial position and financial performance up to the date the consolidated financial reports approved and published; also, the relevant influences would be disclosed upon the completion of assessment.

IV. Summary of Significant Accounting Policies

(I) Declaration in compliance

The present consolidated financial reports has been duly worked out in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and the IFRSs recognized and issued into effect by FSC. (II) Basis of preparation

Except for the financial instruments measured at fair value, investment properties, and the net defined benefit liabilities recognized at fair value after the project assets are deducted from the present value of defined benefit obligations, the consolidated financial reports have been duly prepared on the grounds of historical costs.

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The evaluation of fair value could be classified into Degree 1 to Degree 3 by the observable intensity and importance of related input value:

1. Degree 1 input value: refers to the quotation of the same asset or liability in an active market as of the evaluation (before adjustment)

2. Degree 2 input value: refers to the direct (the price) or indirect (inference of price) observable input value of asset or liability further to the quotation of Level 1.

3. Degree 3 input value: the unobservable input value of asset or liability.

4. (III) Standards in differentiating current and non-current assets and liabilities Current assets include:

5. Assets held primarily for the purposes of transactions;

6. Assets anticipated to be realized within 12 months after the balance sheet date; and

7. Cash and cash equivalents (excluding those restricted for exchanging or liquidating liabilities over 12 months after the balance sheet date). Current liabilities include:

8. Liabilities held primarily for the purposes of transactions;

9. The liabilities to be liquidated upon due within 12 months after the balance sheet date (those with long-term refinancing or payment term rearrangement completed from the balance sheet date to the financial reports approved and published date are also classified as current liabilities), and

10. Liabilities that cannot be with the liquidation date deferred unconditionally for at least 12 months after the balance sheet date; Where the liabilities might be paid off at the discretion of the other party through the tools of the issuance equity, the classification would remain unaffected.

11. Those not as aforementioned current assets or current liabilities are classified

12. as non- current assets or non-current liabilities.

13. (IV) Basis of consolidation

The present Consolidated financial reports are the financial reports containing the Company, and the entities under the control by the Company (subsidiaries). Consolidated statements of income of comprehensive income already covered the operating profit and/or loss of the subsidiaries, which have been acquired or disposed of the current term, from the date of acquisition until the date of disposal. The financial reports of the subsidiaries have been duly adjusted so that their accounting

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policies would be consistent with the accounting policies of the Consolidated Company. Upon preparation of the consolidated financial reports, the transactions among entities, balances, gains, expenses and losses on account have been written out in full. The total comprehensive incomes of the subsidiaries were non-controlling interest attributed to the Company’s owners and the non-controlling interest, to become the balance of loss even as the non-controlling interest.

When the change in the ownership equity on a subsidiary of any consolidated company does not result in a loss of control, it is processed as an equity transaction. The book value of the Consolidated Company and the non-controlling equity has been adjusted to reflect the change in the relative equity on the subsidiary. The difference between the adjusted amount of the non-controlling equity and the considerations paid or collected is directly recognized as equity and attributable to the Company’s shareholders.

When the Consolidated Company loses control of a subsidiary, the disposal of gains or losses is the difference between the following two: (1) the sum of the fair value of the consideration collected and the remainder of the investment in the foregoing subsidiary according to the fair value on the date the control was lost and (2) the sum of assets (including good will) and liabilities and non-controlling interests of the said subsidiary according to the book value on the date the control was lost. Meanwhile, the amount relevant to the said subsidiary recognized in other combined gains or losses were managed on the same accounting grounds as those that it should comply with if the Consolidated Company directly disposes of the relevant assets or liabilities.

(V)

Please refer to Note XI and Attachment 5 for the information, shareholding ratio, and business operation of the subsidiary. Foreign currency

When the respective entities prepared for the consolidated financial reports, the transactions conducted in currencies other than the entities’ functional currencies (foreign currencies) were converted into the records of functional currencies based on the exchange rates quoted on the date of transactions.

The items in foreign currencies were converted at the exchange rates closed on each and every balance sheet date. The difference in foreign exchanges incurred by the items of settlement currency items or conversion currency items was recognized as the profit and/or loss for the term of occurrence.

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The foreign currencies, non-current items measured at fair values were converted at the exchange rates quoted on the date on which the fair values were determined. The difference in foreign exchange so incurred was entered as the profit and/or loss of the current term. In the event where the change in the fair value was recognized into other comprehensive profit and/or loss, the difference of the foreign exchange so incurred was entered as other comprehensive profit and/or loss.

The non-current items measured at historical costs were converted based on the exchange rate quoted on the date of transaction and were not converted anew.

Upon preparation of the consolidated financial reports, the assets and liabilities of the overseas operating institutions (including the subsidiaries in the countries of business operation or those using currencies different from the Company’s) were converted to New Taiwan Dollars based on the exchange rate quoted on every balance sheet date. The gain, fee and loss items were converted based on the exchange rates averaged in the current term. The difference of conversion so incurred was entered as other comprehensive income.

If the Consolidated Company disposes of all equities of its foreign operating sites or disposes of some of the equities of the subsidiaries of its foreign operating sites and loses control or the retained equities following such disposal are financial assets handled according to the accounting policy for financial instruments, all cumulative exchange differences that are relevant to the said foreign operating sites shall be recategorized as gains or losses.

(IV)

If partial disposal of the subsidiaries of overseas operating entities does not lead to loss of control, cumulative exchange differences will be calculated as part of the non-controlling interests that re-belong to the said subsidiaries and they are not recognized as gains or losses. Under other circumstances where overseas operating institutions are partially disposed of, accumulated differences of conversion, on the other hand, are recategorized to gains or losses in proportion to the disposal. Inventories

Inventories include raw materials, supplies, finished goods and work in process. The inventory was measured at the lower of cost and net realizable value. In comparison between the cost and realizable value, the individual items shall be taken as the grounds except inventory of the same categories. The term “net realizable value” as set forth herein denotes the balance of the selling price estimated under normal conditions deducted with the cost which is estimated to be invested till

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completion of manufacture and completion of sales. The cost of inventory was calculated in weighted average method.

(VII) Property, plant and equipment

The property, plant and equipment were recognized at costs. Subsequently thereafter, they were measured at the amount of the costs deducted with depreciation and the loss in the accumulated impairment.

The property, plant and equipment under construction were recognized at the amount of the costs after deducting the loss in the accumulated impairment. The costs included fees incurred for professional services and costs of loan which were consistent with the conditions of capitalization. For those assets, depreciation started being amortized when those assets were completed to the extent of being ready for use and duly classified into the appropriate categories of property, plant and equipment.

Except own land, for which no depreciation would be provided, the other property, plant and equipment were depreciated and for each and every major part individually, on a straight-line basis within the useful years. The Consolidated Company, at least at the end of each fiscal year, has the estimated useful years, residual value, and depreciation method reviewed, and also delayed the effects of changes in applying accounting estimates.

When the property, plant, and equipment were written-off, the difference between the net proceeds from disposal and the book value of the asset is recognized in the profit and loss.

(VIII) Investment property

The investment property denotes such property held in an attempt to earn rent or capital increment or for the both purposes. The investment property also includes the land held for which the future purpose of use has not been resolved.

The investment property was measured at the initial costs (including transaction costs). Subsequently thereafter, it will be measured at the fair value. Changes of the fair value are recognized in the profit and loss when occurring.

When investment property is written off, the difference between the net proceeds from disposal and the book value of the asset is recognized in the profit and loss.

• (IX) Intangible assets

• Individually acquired

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The intangible assets with limited useful life individually acquired were measured at costs. Subsequently, they were measured at cost deducted with the amount of accumulated amortization and the loss of the accumulated impairment. Intangible assets within the durability period are amortized on the straight-line basis. The Consolidated Company reviews at least on the end date of each year the estimated durability period, residual value, and depreciation method and postpones impacts where changes in accounting estimates apply. Intangible assets with indefinite durability are recognized with the cost less cumulative impairment loss.

1. Derecognition

When intangible assets are written off, the difference between the net proceeds from disposal and the book value of the asset is recognized in the profit and loss.

(X) Impairment of real estate properties, plants and equipment, right-of-use assets, and intangible assets-related assets

The Consolidated Company evaluates on the date shown on each balance sheet whether there are any signs showing that real estate properties, plants, and equipment, right-of-use assets, of investment-oriented real estate properties and intangible assets might have been impaired. Where any sign of impairment was found to exist, the Company estimated the recoverable amount of such assets. In the event that the recoverable amount of individual assets could not be estimated, the Consolidated Company estimated the recoverable amount of the units that yielded cash. The common asset is amortized to each cash-generating unit in accordance with a consistent and reasonable sharing basis.

The intangible asset with indefinite useful years and not yet available for use should be tested for impairment at least annually or should be tested when there is an indication of impairment.

The recoverable amount denotes fair value deducted with the selling costs and the useful value, whichever is the higher. In the event that the individual asset or the recoverable amount of the units that yielded cash was found below the book value, such asset or the book value of the units that yielded cash was adjusted downward to the recoverable amount, with the impairment profit and loss recognized in profit and loss.

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(XI) Financial instruments

The financial assets and financial liabilities were recognized onto the consolidated balance sheet when the Consolidated Company became a party to the contract of the financial instruments.

Upon initial recognition of financial assets and financial liabilities, if the financial assets or financial liabilities were those other than the financial assets or liabilities at fair value through profit or loss, the Consolidated Company measured the same based on the fair value added with the transaction costs, which could be directly attributed to the acquisition or issuance of the financial assets or financial liabilities. The transaction costs which could be directly attributed to the acquisition or issuance of such financial assets or financial liabilities, which were measured at the fair value, were imaginably recognized as the profit and/or loss.

1. Financial assets

The transaction customs of the financial assets were recognized or derecognized on the transaction day accounting basis.

• (1) Categories of measurement

The financial assets held by the Consolidated Company include financial assets at fair value through profit or loss, financial assets measured at amortized cost, and investment in equity instruments at fair value through other comprehensive income.

A. The financial assets at fair value through profit or loss.

The financial assets at fair value through profit or loss refer to those measured at fair value through profit or loss compulsorily. The financial assets measured at fair value through profit or loss compulsorily include the investment in equity instruments not designated to be measured at fair value through other comprehensive income, and the investment in bond instruments not eligible to be categorized those at amortized cost or at fair value through other comprehensive income.

The financial assets at fair value through gains or losses were measured at fair value, and the gains or losses so incurred were recognized as other profit and loss. Please refer to Note XXVII for the determination of fair value.

• B. Financial assets measured at amortized cost

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If the financial assets invested by the Consolidated Company meet the following two conditions at the same time, they are classified as financial assets measured at amortized cost:

• a. Being held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and

• b. The contractual terms of the financial asset give rise, on specified dates, to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Upon the initial recognition, the financial assets measured at amortized cost (including cash and cash equivalents, accounts receivable measured at amortized cost, other accounts receivable, time deposit with initial maturity date more than three months away, and refundable deposit ) were measured at the amortized cost after the total book value decided using the effective interest method less any impairment loss. Any foreign currency exchange income was recognized in the profit or loss.

Except in the following two circumstances, the interest revenue was calculated at the effective interest rate multiplying by the total book value of the financial assets:

• a. For the purchased or originated credit-impaired financial assets, the interest revenue was calculated at the effective interest rate multiplying by the amortized cost of the financial assets upon credit adjustment.

• b. For those other than purchased or originated credit-impaired

• financial assets, which, however, became the purchased or originated credit-impaired financial assets subsequently, the interest revenue was calculated at the effective interest rate multiplying by their amortized cost as of the next reporting period after the credit impairment.

The credit-impaired financial assets mean that issuers or debtors already suffered hard-up financial standing or default, or an event where a debtor was about to run into bankruptcy or proceed with financial reorganization, or the hard-up financial standing leading to loss of active market of the assets.

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Cash equivalents include time deposits in high liquidity, which could be converted into cash of the specified amounts at any time within three (3) months from acquisition, with little risk in the change in values, intended to be used to satisfy the commitment in the short-term cash.

• C. Investment in Equity Instruments at Fair Value through Other Combined Gains or Losses

However, the Consolidated Company may choose at the time of original recognition to have the equity instrument investment not held for trading and not recognized by the acquirer in the business combination transaction or not with consideration measured at fair value through other comprehensive income.

Investment in equity instruments at fair value through other comprehensive income are measured at fair value, and the subsequent movements of the fair value are measured in other comprehensive income, and accumulated in other equity. When disposing investments, the accumulated profit/loss is transferred to the retained earnings directly without reclassified as profit/loss.

The dividends from the investment in equity instruments at fair value through other comprehensive income are recognized in profit/loss when the Consolidated Company’s rights of receiving payment is confirmed, unless such dividends obviously represents the recovery of part of the investment.

(2) Impairment of financial assets and contract assets

On each balance sheet date, the Consolidated Company evaluates the impairment loss on financial assets (including accounts receivable), financing lease payments receivable, and impairment loss of contract assets based on expected credit loss.

The allowance losses on accounts receivable were all recognized based on the lifetime expected credit loss. For other financial assets, the credit risk is evaluated if there is any significant increase after the initial recognition. If not, the allowance loss is recognized based on the expected credit losses of 12 months; if there any significant increases, the

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allowance loss is recognized based on the expected credit losses of life time.

Expected credit losses as the weighted average of credit losses with the weightings being the respective risks of a default occurring. 12-month expected credit losses are expected credit losses that result from those default events on the financial instruments that are possible within 12 months after the reporting date. Lifetime expected credit losses are the expected credit losses that result from all possible default events over the life of the financial instruments.

The book value of all impairment losses on financial assets were reduced via the allowance account.

(3) Derecognition of financial assets

The Consolidated Company would derecognize financial assets only in the event where the interests on a contract for financial assets based cash flow ceased to be effective or where they had transferred financial assets and almost all risks and returns of all ownership over the financial assets had been transferred to another enterprise.

2.

Where a financial asset measured at amortized cost was derecognized end masse, the difference between the book value and collected consideration was recognized into profit or loss. When fully derecognizing the investment in equity instrument at fair value through other comprehensive income, the accumulated profit/loss is directly transferred to retained earnings, not to be reclassified as profit or loss. Equity instruments

The liabilities and equity instruments issued by the consolidated company were categorized as financial liabilities or equity based on the substance of the contract agreement and the definition of financial liabilities and equity instruments.

The equity instruments issued by the Consolidated Company were recognized based on the acquisition price less direct issuing cost.

The Consolidated Company’s own equity instruments re-acquired were derecognized and deducted under the equity title. Acquisition, sale, issuance or cancellation of the Consolidated Company' own equity instruments would not be recognized into profit or loss.

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3. Financial liabilities

(1) Subsequent measurement

All financial liabilities are measured at amortized cost based on the effective interest, unless in the following circumstances:

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss refer to the financial liabilities held for trading.

The financial liabilities held for trading were measured at fair value, the interest so incurred recognized into the financial cost, and the other profit or loss so incurred from re-measurement recognized into other profit or loss.

Please refer to Note XXVII for the determination of fair value.

• (2) Derecognition of financial liabilities

When de-recognizing financial liabilities, the difference between the book value and the consideration paid (including any transferred non-cash assets or assumed liabilities) is recognized into profit or loss.

1. Derivative financial instruments

The Consolidated Company entered into forward foreign exchange contracts as their derivative financial instruments to manage their exposure to the foreign exchange rate risk.

Derivative financial instruments were initially recognized at fair value at the date the derivative financial instrument contracts were entered into and were subsequently remeasured to their fair value on the balance sheet date. The resulting profit or loss is stated into profit or loss immediately. Notwithstanding, when the derivative financial instruments which were designated and considered as effective hedging instruments should be recognized into profit or loss should be decided subject to the nature of hedging relationship. The derivatives with positive value were classified as financial assets. Those with negative value were classified as financial liabilities.

If the derivatives are embedded into the master contracts for assets falling in the scope under IFRS 9 “Financial Instruments”, the financial assets shall be classified based on the entire contracts. Embedded derivatives other than those embedded into the host contracts for assets falling in the scope under IFRS 9

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(e.g. those embedded into the master contracts for financial liabilities) were treated as separate derivatives when they met the definition of a derivative, their risks and characteristics were not closely related to those of the host contracts, and the contracts were not measured at fair value through profit or loss.

(XII) Provision for liabilities

The provision for liabilities was determined with the obligation risk and uncertainty taken into account, which is the best estimate of the obligation payable on the balance sheet date.

(XIII) Recognition of revenue

Upon identification of the performance obligation in the contract with customers, the Consolidated Company amortized the transaction price to the performance obligations in the contract and recognize income upon fulfilling performance obligation of the contract.

If the Consolidated Company signs multiple contracts with the same customer (or the customer’s related party) almost at the same time, the Consolidated Company would treat them as one single contract, as the commitment about commodity or labor service under the contracts should be identified as single performance obligation.

For any contract providing the time interval between transfer of commodities or labor services and collection of consideration no more than one year, no adjustment would be made on the transaction price with respect to the financing component thereof.

Sales revenue

The sales revenue was generated from the sale of the electronic products, such as printed circuit boards. Upon arrival of products to the destination designated by customers, the customers have already owned the right to set the price and use the same and taken the responsibility for re-sale and borne the obsolescence risk; therefore, the Consolidated Company recognized the revenue and accounts receivable at that moment.

As the ownership of processed products has not yet been transferred at the time of processing on order, no revenue would be recognized at that moment.

(XIV) Lease

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The Consolidated Company evaluated if a contract was, or included a lease on the date when the contract was established.

1. The Consolidated Company was the Lessor.

In the event that all risks and remuneration of the ownership of the assets based on the leasehold terms and conditions were transferred to the lessees in full, such assets were classified as financing leasehold. All other categories of leases were classified as operating leases.

Under the operating leases, the rent less the lease incentives was recognized into profit or loss based on the straight-line method in the duration of the leases. The initial direct cost arising from negotiating and arranging operating leases, was increased to the book value of the underlying assets, and recognized as expenditure on the straight-line basis over the lease period.

1. The Consolidated Company was the Lessee.

The lease payments applicable to the recognized waived low-valued underlying asset lease and the short-term lease are recognized as expenditure on the straight-line basis over the lease period. For all other leases, the right-of-use assets and lease liabilities are recognized from the starting date of leases.

The right-of-use assets were originally measured at the costs (including the original measured amount of lease liability); subsequently, they were measured at the costs deducting the accumulated depreciation and the accumulated impairment loss, and the re-measurement of the lease liability was adjusted. The right-of-use assets were individually expressed in the consolidated balance sheet.

The right-of-use assets on the straight-line basis were depreciated from the starting date of lease until expiration of the useful years or the lease period, whichever earlier. If the ownership of underlying assets would be acquired upon expiration of the lease period, or the costs of right-of-use assets reflected the exercise of right of first refusal, the assets should be depreciated from the starting date of lease until expiration of the useful years.

The lease liabilities were measured based on the present value of the lease payment (including fixed payment and variable lease payment depending on any index or fees ). If the implied interest rate of a lease should be easy to be confirmed, the rate should be applied to discount the lease payment.

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Otherwise, the incremental the lessee’s loan rate of interest should apply instead.

Subsequently, the lease liabilities were measured at amortized cost using the effective interest method. The interest expenditure was also amortized within the lease period. If there was any change in the lease period or any index or fees determining the lease payments would result in changes of future lease payment, the Consolidated Company re-measured the lease liabilities, and relatively adjusted the right-of-use assets; provided the book value of the right-of-use asset has decreased to zero, the remaining re-measured amount was recognized in the profit or loss. The lease liabilities were individually expressed in the consolidated balance sheet.

(XV) Cost of borrowings

The costs of loan for the assets that meet the essential requirement and directly attributable to the acquisition, construction, or production of assets is deem as part of the asset cost until all of the necessary activities completed for the assets to reach its intended use or sale state.

The income of a temporary investment with a specific loan that has not yet met the essential requirement of capital expenditure is deducted from the cost of loan that meets the essential requirements of capitalization.

In addition to the transaction stated in the preceding paragraph, costs of all other loans are recognized into profit and loss upon occurring.

(XVI) Government subsidies

The government subsidies would be recognized only if that it is strongly believed on reasonable grounds that the Consolidated Company would comply with the conditions imposed on the government subsidies and such subsidies may be received affirmatively.

Government subsidies concerning gains are recognized systematically under other income during the period where related costs they are meant to offset are recognized by the Consolidated Company as expenditure. The government subsidies for acquisition of non-current assets by the Consolidated Company through procurement/construction or in any other manners should be debited into the book value of the non-current assets, and recognized into profit and/or profit within the useful years of the assets by reducing the depreciation or amortization expenses for the non-current assets.

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If government subsidies are meant to compensate for incurred expenditure or losses or for providing the Consolidated Company with immediate financial support and are not associated with costs in the future, they are recognized under gains or losses during the collectible period.

(XVII) Employee benefits

1. Short-term employee benefits

Short-term employee benefits related liabilities are the non-discounted amount prepaid in exchange for employee services.

1. Benefits after severance/retirement

For pension under the defined contribution retirement plan, the amounts of pension to be contributed during the period in which employees provided services were recognized as expenditure.

The defined benefit costs under the defined benefit retirement plan (including the service costs, net interest, and re-measurement amount) were based on the actuary of projected unit credit method. The service costs (including current service costs), and net interest on the net defined benefit liabilities (assets) were recognized as employee benefit expenditure in the period they occur. The re-measurement amount (including actuarial profit and loss and projected ROA net of applicable interest) was recognized as other comprehensive income and stated as retained earnings at the time of realization, but would not be reclassified as income in subsequent periods.

The net defined benefit liabilities (assets) refer to the amount short (surplus) in the contribution under the defined benefit retirement plan. The net defined benefit assets should not exceed the refund of the contributed fund or decrease the present value of contribution of fund in the future.

1. Resignation benefits

The Consolidated Company had resignation benefit liabilities recognized when the resignation benefit contract cannot be revoked or when recognizing the related reorganization cost (whichever is sooner).

(XVIII) Income tax

The income tax expenditure denotes the total of the income tax payable in the current term and the deferred income tax.

1. Current income tax

2. 34 -

The Consolidated Company decides gains (losses) for the current term according to the laws and regulations defined in the jurisdiction where income tax is filed and calculates the payable (recoverable) income tax accordingly.

The income tax imposed on undistributed earnings calculated as required by the Income Tax of the Republic of China is recognized for the year according to the resolution reached in the shareholders' meeting.

Adjustment of the prior years’ income tax is added to current income tax expenditure in the year the adjustment is made.

2.

Deferred income tax

Deferred income tax is computed in accordance with the temporary differences between book value of the assets and liabilities and the tax base for calculating the taxable income.

Deferred tax liabilities are generally recognized in accordance with all taxable temporary differences. Deferred tax assets are recognized when there are likely to have taxable income available for deductible temporary difference.

All taxable temporary differences relevant to the investment in subsidiaries were recognized as deferred income tax liabilities, unless the Consolidated Company could control the time point of recovery of the control over the temporary difference, or said temporary difference would be very likely not recoverable in the foreseeable future. The deductible temporary differences associated with such investment were recognized as deferred income tax assets, to the extent that sufficient taxable income was available to realization of temporary differences and such differences were expected to be reversed in the foreseeable future.

The book value of the deferred income tax assets was reviewed anew on each and every balance sheet date. Aiming at such event where there would be very likely not adequate taxable income to recover the assets either in whole or in part, the Consolidated Company adjusted downward the book value. Those which were not initially recognized as deferred income tax assets were also reviewed anew on each and every balance sheet date. The Consolidated Company, in turn, would adjust upward the book value in the future while there would be likely to yield taxable income to recover assets either in whole or in part.

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The deferred income tax assets and liabilities were measured at the tax rates of that term. The said tax rate would be on the grounds of the tax rates and taxation laws, which had been enacted or had been substantially enacted as of the balance sheet date. The deferred income tax liabilities and assets were measured to reflect the Consolidated Company’s taxation consequences for the book value of the assets and liabilities anticipated to be recovered or reimbursed as of the balance sheet date. Where the investment property measured at fair value is a non-depreciation asset, or the economic model as held would not be likely to consume almost all of the economic benefit from the assets over time, the Consolidated Company would assume that the book value of the assets was recovered through sale.

3.

Current and deferred income tax

The current and deferred income tax was recognized into profit and/or loss. The current and deferred income tax relevant to the items, which were recognized in other comprehensive income or directly counted into the items of equity, was recognized into other comprehensive income or directly counted into equity respectively.

Where the current income tax or deferred income tax was generated from acquisition of any subsidiary, the income tax effect should be included into the invested subsidiary's accounting treatment.

V. Major sources of major accounting judgments, estimates and hypotheses of uncertainty

Where the Consolidated Company adopted accounting policies, for the relevant information which was found hardly available from other sources, the management must come to relevant judgments, estimates and hypotheses based on historical experiences and other relevant factors. The actual consequences might differ from the estimates.

The management would continually review the estimates and fundamental hypotheses. In the event that the estimated amendment would only affect the current term, it would be recognized in the term when the amendment was made. In the event that the amendment of the accounting estimates would simultaneously affect both the current and future terms, it would be recognized in the term when the amendment was made, and the future term.

Major sources of estimates and hypotheses of uncertainty Estimated impairment of financial assets

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The estimated impairment of accounts receivable is based on the Consolidated Company’s hypotheses about the default rate and defaults loss rate. The Consolidated Company took into consideration the historical experience, existing market conditions and forward-looking estimates to make the assumptions and select the inputs to the impairment calculation. For details of the key assumptions and inputs used, please refer to Note XXVII. If the actual future cash flows are less than expected, a material impairment loss may have arisen therefor.

VI. Cash and Cash Equivalents

impairment loss may have arisen therefor. Cash and Cash Equivalents	impairment loss may have arisen therefor. Cash and Cash Equivalents
December 31, 2022 Cash on hand and working capital $ 1,209 Bank’s notes and current deposit 4,665,815 Cash equivalents (investment due within three (3) months in the date of initial maturity). Bank time deposit 1,306,953 $ 5,973,977 Financial Instruments at Fair Value through Profit or Loss December 31, 2022 Financial assets-current At fair value through profit or loss compulsorily Derivatives (not under hedge accounting) －Forward foreign exchange contracts (1) $ 40,166 －FX swaps contracts (2) - Non-derivative financial assets －TWSE/TPEx-listed stocks 3,136 $ 43,302 Financial liabilities-Current At fair value through profit or loss compulsorily Derivatives (not under hedge accounting) －Forward foreign exchange contracts (1) $ 704 －FX swaps contracts (2) 4,204 $ 4,908		December 31, 2021
		$ 1,263 3,136,536 679,308 $ 3,817,107 December 31, 2021
Financial assets-current At fair value through profit or loss compulsorily Derivatives (not under hedge accounting) －Forward foreign exchange contracts (1) －FX swaps contracts (2) Non-derivative financial assets －TWSE/TPEx-listed stocks Financial liabilities-Current At fair value through profit or loss compulsorily Derivatives (not under hedge accounting) －Forward foreign exchange contracts (1) －FX swaps contracts (2)
			$ 15,279 6,172 4,240 $ 25,691 $ - - $ -

VII. Financial Instruments at Fair Value through Profit or Loss

• 37 -

(I) Outstanding forward foreign exchange contracts not applicable under hedge accounting on the balance sheet date are provided below:

December 31, 2022 Sold forward foreign exchange contracts Sold forward foreign exchange contracts Sold forward foreign exchange contracts December 31, 2021 Sold forward foreign exchange contracts Sold forward foreign exchange contracts Sold forward foreign exchange contracts	Currency type Sell USD/Buy NTD Sell USD/Buy CNY Sell USD/Buy CNY Sell USD/Buy NTD Sell USD/Buy CNY Sell USD/Buy CNY	Maturity date January 3, 2023 - March 9, 2023 January 31, 2023 January 31, 2023 – May 26, 2023 January 3, 2022 – February 15, 2022 January 12, 202 – February 28, 2022 January28, 2022 – April 28, 2022	Contract amount (NTD Thousand)
			USD 40,000 /NTD 1,227,696 USD 6,000 /CNY 43,135 USD 35,000 /CNY 224,294 USD 24,000 /NTD 667,344 USD 40,000 /CNY 256,706 USD 35,000 /CNY 224,294

• (II) The outstanding FX swaps contracts not under hedge accounting on the balance sheet date are stated as follows:

December 31, 2022 FX swap contracts December 31, 2021 FX swap contracts	Currency type Sell USD/Buy NTD Sell USD/Buy NTD	Maturity date January 31, 2023 January 28, 2022 – February 25, 2022	Contract amount (NTD Thousand)
			USD 44,000 /NTD 1,347,036 USD 62,000 /NTD 1,722,332

The Consolidated Company entered into forward foreign exchanges and FX swaps primarily in order to hedge against the risk arising from foreign currency assets and liabilities due to fluctuations in foreign exchange rate.

• 38 -

VIII. Financial Assets Measured at Amortized Cost

Financial Assets Measured at Amortized	Cost
Current Domestic investment Time deposit whose original maturity date exceeds 3 months	December 31, 2022 $ 45,100	December 31, 2021
			$ 31,700

As of December 31, 2022 and 2021, the range of interest rates for time deposits with an initial maturity date exceeding 3 months was an annual rate of 0.86%–1.125% and 0.36%–0.49%, respectively.

IX. Notes receivable, accounts receivable and other receivables

Notes receivable Measured at amortized cost Total book value Less: Allowance losses Generated from operations Accounts receivable Measured at amortized cost Total book value Less: Allowance losses Generated from operations Other receivables Business tax refund receivable Accounts receivable from sale of scraps Others	December 31, 2022 $ 9,424 - $ 9,424 $ 10,842,198 ( 115,206) $ 10,726,992 $ 43,861 39,887 4,985 $ 88,733	December 31, 2021	December 31, 2021
	(	(	$ 17,628 - $ 17,628 $ 9,180,804 75,140) $ 9,105,664 $ 38,375 31,496 21,333 $ 91,204

• 39 -

Notes receivable and accounts receivable

The Consolidated Company’s average credit period for sale of commodities is 180 days. The notes receivable and accounts receivable are collected without interest. Considering that the Consolidated Company’s trading counterparts were primarily domestic/foreign renowned companies/entities with fair goodwill, no material credit risk was expected to arising therefor. Upon determination of the recoverability of notes receivable and accounts receivable, the Consolidated Company took into account and all changes in the quality of credit of the accounts receivable during the period starting from the initial granting of the loan until the balance sheet date. Historical experiences have shown optimal recovery of notes and accounts receivable in most cases.

In order to mitigate the credit risk, on the balance sheet date, the Consolidated Company would recheck on a case-by-case basis the recoverable amount of notes and accounts receivable to assure that for the notes and accounts receivable which were not recoverable, appropriate impairment loss has been duly amortized. Accordingly, the Consolidated Company’s management holds that the Consolidated Company’s credit risk is significantly mitigated.

The Consolidated Company recognized the allowance losses on notes and accounts receivable based on the lifetime expected credit loss. The lifetime expected credit losses were calculated using the reserve matrix, by considering the customers’ past default records and current financial position, industrial economic situations, as well as the recoverable amount. As the Consolidated Company’s credit loss history showed that there was no significant difference among the loss patterns of different customer bases, the reserve matrix didn’t further divide the customer bases, but only established the expected credit losses based on the number of days for which the notes and accounts receivable became overdue.

If evidence shows financial difficulties facing counterparts and it is impossible for the Consolidated Company to reasonably anticipate the recoverable amount, such as when the counterpart is engaged in restructuring and liquidation, the Consolidated Company will write off related notes and accounts receivable directly. Recourse, however, will be continued and the amount collected as such is recognized under gains or losses.

The allowance losses on notes and accounts receivable measured by the Consolidated Company based on the reserve matrix are stated as following: December 31, 2022

• 40 -

Accounts receivable

Expected Credit Loss (ECL) Rate Total book value Allowance losses (lifetime expected credit loss) Amortized cost		Not overdue		Overdue for 1~60 days		Overdue for 61~90 days		Overdue for 91~120 days	Overdue for more than 120 days		Total
	(	0%～0.06% $ 10,525,322 6,068) $ 10,519,254	(	0%～19.05% $ 218,561 26,155) $ 192,406	(	59.96% $ 31,257 18,741) $ 12,516	(	73.82% $ 4,529 3,343) $ 1,186	94.38%～100% $ 62,529 ( 60,899) $ 1,630	(	$ 10,842,198 115,206) $ 10,726,992

December 31, 2021

Accounts receivable

Expected Credit Loss (ECL) Rate Total book value Allowance losses (lifetime expected credit loss) Amortized cost		Not overdue		Overdue for 1~60 days		Overdue for 61~90 days		Overdue for 91~120 days	Overdue for more than 120 days		Total
	(	0%～0.1% $ 9,027,689 8,487) $ 9,019,202	(	0%～24.84% $ 109,341 23,896) $ 85,445	(	0%～80.84% $ 4,888 3,935) $ 953	(	91.60% $ 655 600) $ 55	99.82%～100% $ 38,231 ( 38,222) $ 9	(	$ 9,180,804 75,140) $ 9,105,664

The information about changes in allowance losses on notes and accounts receivable is stated as follows:

Accounts receivable

stated as follows: Accounts receivable
Balance at start of term Add: Impairment loss recognized for the current term (1) Less: Reversal of impairment loss for the current term (1) Less: Actual offset for the current year (2) Foreign currency exchange difference Balance – end of period		2022 $ 75,140 39,549 - - 517 $ 115,206	2021 $ 180,852 - ( 50,106 ) ( 55,287 ) ( 319) $ 75,140

• (1) The net amount of the total book value of accounts receivable overdue for more than 90 days from the beginning of year rose on December 31, 2022 by NTD 28,172 thousand and it resulted in the decrease in allowance losses by NTD 25,420 thousand as well. The net amount of the total book value of the accounts receivable overdue for more than 90 days decreased on December 31, 2021 by NTD 57,613 thousand and it resulted in the decrease in allowance losses by NTD 57,677 thousand.

• (2) In 2021, due to the fact that some customers were engaged in liquidation, related accounts receivable were offset and it resulted in allowance losses of NTD 55,287 thousand.

• 41 -

X. Inventories

Inventories
Finished goods Work in process Raw materials & supplies Inventories in transit	December 31, 2022 $ 2,462,092 2,334,137 643,342 176,399 $ 5,615,970	December 31, 2021
			$ 2,025,179 1,787,105 794,108 215,358 $ 4,821,750

Sales cost is defined as follows:

Sales cost is defined as follows:
Cost of inventory already sold Loss on inventory devaluation (gain from price recovery) Income from the sale of scraps and waste materials Others	2022 $ 24,997,437 148,583 ( 780,146 ) ( 308,898) $ 24,056,976	2021
		$ 21,264,401 ( 9,916 ) ( 1,069,989 ) 51,938 $ 20,236,434

XI. Subsidiaries

The subsidiaries included into the consolidated financial reports

The present consolidated financial reports were prepared for the following key entities:

Investor	Name of subsidiary	Business nature General investment business General investment and international trade business General investment and international trade business General investment and international trade business Design, produce and sell multi-layer printed circuit boards Design, produce and sell multi-layer printed circuit boards Design, produce and sell multi-layer printed circuit boards	Shareholding ratio	Shareholding ratio	Desc riptio n
			Decembe r 31, 2022	Decembe r 31, 2021
Gold Circuit Electronics Ltd. Gold Circuit Electronics Ltd. Goldex Holding Limited Goldex Holding Limited Gold Circuit International Company Gold Circuit Enterprise Gold Circuit Enterprise	King Hsiang Investment Co., Ltd. (hereinafter referred to asKing Hsiang Investment) Goldex Holding Limited Gold Circuit International Limited (hereinafter referred to as Gold Circuit International Company) Gold Circuit Enterprise Limited (hereinafter referred to as Gold Circuit Enterprise) Suzhou Gold Circuit Electronics Ltd. (hereinafter referred to as Suzhou Gold Circuit Electronics) Changshu Gold Circuit Electronics Ltd. (hereinafter referred to as Changshu Gold Circuit Electronics) Changshu Gold Circuit Technology Co., Ltd. (hereinafter referred to as Changshu Gold Circuit Technology)		99.997 100.00 100.00 100.00 100.00 100.00 100.00	99.997 100.00 100.00 100.00 100.00 100.00 100.00

• 42 -

XII. Property, plant and equipment

Self-use

Self-use
Cost Balance as of January 1, 2022 Addition Disposal Re-categorization Net difference in foreign exchange Balance as of December 31, 2022 Cumulative depreciation and impairment Balance as of January 1, 2022 Disposal Reclassification Depreciation expenditure Net difference in foreign exchange Balance as of December 31, 2022 Net as of December 31, 2022 Cost Balance as of January 1, 2021 Addition Disposal Re-categorization Net difference in foreign exchange Balance as of December 31, 2021 Cumulative depreciation and impairment Balance as of January 1, 2021 Disposal Depreciation expenditure Net difference in foreign exchange Balance as of December 31, 2021 Net as of December 31, 2021		Own land		Building	Machinery & equipment	Transportation equipment	Office equipment	Other equipment	Unfinished construction and equipment pending acceptance	Total
		$ 701,186 - - - - $ 701,186 $ - - - - - $ - $ 701,186 $ 701,186 - - - - $ 701,186 $ - - - - $ - $ 701,186	( (	$4,358,347 - - 18,626 32,176 $4,409,149 $3,281,762 - - 129,955 21,989 $3,433,706 $ 975,443 $4,363,671 - - 5,720 11,044) $4,358,347 $3,162,895 - 126,085 7,218) $3,281,762 $1,076,585	$13,005,678 - ( 457,758 ) 1,210,291 132,683 $13,890,894 $9,899,541 ( 411,646 ) ( 757 ) 512,157 98,757 $10,098,052 $3,792,842 $13,027,578 - ( 503,421 ) 526,944 ( 45,423) $13,005,678 $9,934,478 ( 445,994 ) 445,877 ( 34,820) $9,899,541 $3,106,137	$ 64,272 - ( 1,668 ) 4,605 459 $ 67,668 $ 39,585 ( 1,584 ) - 6,009 347 $ 44,357 $ 23,311 $ 59,020 - ( 4,258 ) 9,662 ( 152) $ 64,272 $ 38,198 ( 3,996 ) 5,500 ( 117) $ 39,585 $ 24,687	$ 141,875 - ( 7,721 ) 9,094 1,202 $ 144,450 $ 97,549 ( 7,354 ) ( 265 ) 11,652 810 $ 102,392 $ 42,058 $ 138,055 - ( 14,477 ) 18,710 ( 413) $ 141,875 $ 101,838 ( 13,964 ) 9,977 ( 302) $ 97,549 $ 44,326	$2,464,113 - ( 92,179 ) 277,610 27,326 $2,676,870 $1,956,043 ( 89,590 ) 757 175,030 20,911 $2,063,151 $ 613,719 $2,586,214 - ( 313,869 ) 200,522 ( 8,754) $2,464,113 $2,133,974 ( 312,492 ) 141,568 ( 7,007) $1,956,043 $ 508,070	$ 218,195 1,475,538 - ( 1,550,113 ) 2,258 $ 145,878 $ - - - - - $ - $ 145,878 $ 82,027 918,333 - ( 781,874 ) ( 291) $ 218,195 $ - - - - $ - $ 218,195	$20,953,666 1,475,538 ( 559,326 ) ( 29,887 ) 196,104 $22,036,095 $15,274,480 ( 510,174 ) ( 265 ) 834,803 142,814 $15,741,658 $6,294,437 $20,957,751 918,333 ( 836,025 ) ( 20,316 ) ( 66,077) $20,953,666 $15,371,383 ( 776,446 ) 729,007 ( 49,464) $15,274,480 $5,679,186

• 43 -

There was no sign of impairment in 2022. Therefore, the Consolidated Company didn’t recognize or reverse impairment loss.

Depreciation expenditure is appropriated in accordance with the straight line method and the useful years illustrated below:

e useful years illustrated below:
Building
Main building of plant	11~55 years
Electromechanical & power
equipment	5~20 years
Engineering system	3~25 years
Others	5~15 years
Machinery & equipment	1 year ~14 years
Transportation equipment	2~11 years
Office equipment	2~11 years
Other equipment	1 year ~15 years

Please refer to Note XXVIII for the self-use property, plant and equipment offered as collateral of loans.

XIII. Lease Agreement

(I) Right-of-use assets

collateral of loans. ase Agreement Right-of-use assets
Book value of right-of-use assets Land Machinery & equipment Depreciation expenses of right-of-use assets Land Machinery & equipment	December 31, 2022 $ 137,185 31,554 $ 168,739 2022 $ 4,407 18,947 $ 23,354	December 31, 2021
			$ 139,385 49,758 $ 189,143 2021
			$ 4,316 29,492 $ 33,808

Except for the additions and recognition of depreciation expenditure as listed above, no major sublets and impairment of the right-of-use assets of the Consolidated Company occurred between January 1 and December 31, 2022 and 2021.

For the amount of right-of-use assets set to be the collaterals for borrowings, refer to Note XXVIII.

• 44 -

• (II) Lease liabilities

Lease liabilities
Book value of lease liabilities Current Noncurrent	December 31, 2022 $ 12,284 $ 3,110	December 31, 2021
			$ 17,246 $ 15,300

The range of discount rates for the lease liabilities is stated as following:

Machinery & equipment	December 31, 2022 1.38%～3.5%	December 31, 2021
		1.38%～3.5%

• (III) Major lessee activities and terms and conditions

The Consolidated Company rented certain energy-conservation equipment and water quality monitoring systems. The lease periods were 10 years and 3 years, respectively. Upon expiration of the lease period, the lease objects would be transferred to the Consolidated Company unconditionally. Among the other things, the energy-conservation equipment lease contract provided that the lease payment should vary depending on the specific percentage of the energy-conservation amount on a monthly basis.

(IV) Other lease agreement

on a monthly basis. Other lease agreement
Short-term lease expenditure Low-value asset lease expenditure Total amount of cash (outflow) from lease Investment property Balance as of January 1, 2021 Profit from changes in fair value Balance as of December 31, 2021 Profit from changes in fair value Balance as of December 31, 2022		2022 $ 3,970 $ 11,024 $ 32,719)		2021
	(		$ 3,035 $ 11,856 ($ 36,722) Finished investment property
			(	$ 577,000 900 577,900 1,700) $ 576,200

XIV. Investment property

The investment property was measured at fair value on a recurring basis. The evaluation basis for the fair value thereof is stated as following:

External appraisal service	December 31, 2022 $ 576,200	December 31, 2021	December 31, 2021
			$ 577,900

• 45 -

The fair values of any investment property amounting to more than NTD300 million on December 31, 2022 and 2021 were appraised by Appraiser Chiu Hsiang-Ling from CCSI Real Estate Joint Appraisers Firm, who held the real estate appraiser qualification in the R.O.C., on the same dates respectively.

Except undeveloped land, the fair value of investment property was evaluated under the income approach. The important hypotheses thereof are stated as following. When the projected future net cash inflow increased or discount rate declined, the fair value would increase therefor.

value would increase therefor.
Projected future cash inflow Projected future cash outflow Projected future net cash inflow Discount rate	December 31, 2022 $ 843,500 267,300 $ 576,200 2.345%	December 31, 2021
			$ 851,900 274,000 $ 577,900 1.72%

The rent prevailing in the area where the investment property was located was about NTD 0.506 thousand per ping , while that for any comparable object on the market was about NTD 0.515 thousand~ NTD 0.601 thousand per ping (1 ping = 3.305785 m[2] ) .

The projected future cash inflow from investment property included rent revenue and deposit interest revenue less loss from idle assets. The rent income is evaluated based on the rent prevailing locally or that for any comparable object on the market, with any overestimated or underestimated comparable objects excluded, and also based on the growth rate of the future rent. The income analysis period is estimated to be five years. The deposit interest income is estimated based on one-year time deposit interest rate. The loss from idle assets is estimated based on 1.5-month rent income plus deposit interest income. The projected future cash outflow from investment property included the expenditures, such as land value tax, house tax, insurance premium, management expense, maintenance expense, replacement appropriation fee, depreciation expense, disposal expense and estimated land value increment tax. Such expenditures were estimated based on the current expenditure level and by taking into consideration the adjustment on the current land value announced in the future, and tax rate prescribed by house tax regulations.

The discount rate is decided based on the two-year time deposit interest rate published by Chunghwa Post Co., Ltd. plus 0.875%.

XV. Other intangible assets

Other intangible assets
Computer software	December 31, 2022 $ 42,539	December 31, 2021
			$ 26,550

• 46 -

Except for the amortization expenditure that was recognized, no major additions, disposals, or impairment of other intangible assets of the Consolidated Company occurred between January 1 and December 31, 2022 and 2021. Amortization expense was appropriated on a straight-line basis within 1~5 useful years.

Summarization of amortization expenses by functions:

XVI. XVII. (I)	Operating cost Operating expenditure R&D expense Other assets Current Others Noncurrent Refundable deposit Others Loan Short-term loans Secured loans(Note XXVIII) Bank loans Unsecured loans Line of credit loans	2022 $ 13,115 593 2,517 $ 16,225 December 31, 2022 $ 2,934 $ 10,858 - $ 10,858 December 31, 2022 $ 608,641 1,579,793 $ 2,188,434	2021
			$ 10,156 160 2,585 $ 12,901 December 31, 2021
			$ 15,899 $ 11,948 3,549 $ 15,497 December 31, 2021
			$ 497,924 843,282 $ 1,341,206

Revolving bank loan interest rate was 1.110%–4.48% and 0.675%–3.7% on December 31, 2022 and 2021, respectively.

(II) Long-term loans

Long-term loans
Secured loans(Note XXVIII) Mega International Commercial Bank (1) Mega International Commercial Bank (2) KGI Bank (3) Subtotal	December 31, 2022 $ 430,000 - 360,000 790,000	December 31, 2021
			$ - 430,770 250,000 680,770

• 47 -

Unsecured loans CTBC (4) Jih Sun International Bank (5) E.SUN Bank (6) Syndicated banks including Taipei Fubon Bank (7) Syndicated banks including E. Sun Bank (8) Syndicated banks including Taipei Fubon Bank (9) Subtotal Less: current portion Long-term loans	December 31, 2022 $ 200,000 300,000 100,000 700,000 1,250,000 - 2,550,000 - $ 3,340,000	December 31, 2021	December 31, 2021
			$ 200,000 - - - - 996,480 1,196,480 253,142 $ 1,624,108

1. Land and buildings are set as the collaterals for secured borrowings. NTD 430,000 thousand out of the total value of NTD 900,000 thousand has been fully drawn down. The borrowing period was from July 8, 2022 to July 8, 2025. The cyclic drawdowns were based on request forms. As of December 31, 2022, the effective annual interest rate was 1.8%.

2. Land and buildings are set as the collaterals for secured borrowings. The total value of NTD 700,000 thousand has been drawn down in full. The borrowing period began on September 6, 2019 and ended on September 6, 2024, with interests paid on a monthly basis. From the date of the first draw-down, the first term was up to the end of the first 24 months and each term thereafter consists of 3 months. The borrowings are to be paid in installments over a total of 13 terms. The loans were already repaid in full earlier in July 2022. As of December 31, 2021, the effective annual interest rate was 1.2%.

3. Land and buildings are set as the collaterals for secured borrowings. NTD360,000 thousand out of the total value of NTD500,000 thousand has been drawn down. The borrowing period was from April 30, 2017 to April 30, 2024. Prior to expiration, the borrowing period had been extended to January 26, 2025. The line of credit was reduced by NTD100,000 thousand at the end of 18, 24 and 30 months, respectively, from the date of extension. All the remaining limits decreased and canceled at the end of 36 months. It has been drawn down cyclically within 3 years since January 26, 2022, with interests paid on a monthly basis, and will be paid off at once upon maturity. As of December 31, 2022 and 2021, the effective annual interest rates were

4. 48 -

1.849%–1.862% and 1.288%, respectively. The quarterly consolidated financial ratios on the loans during the effective term were subject to the following restrictions: The total of cash and cash equivalents and EBITDA (net income, income tax expense, financial costs (interest expenses), depreciation expenses and amortization expenses in the long-term loan, current portion should stay more than 120% (inclusive).

1. For credit-based borrowings, totaling NTD225,000 thousand, NTD200,000 thousand has been drawn down; the borrowing period was from November 23, 2021 to November 23, 2023. The borrowing period had been extended to July 15, 2024 for the current term. Since the date of borrowing, the interest should be accrued, subject to the balance of loan, at the interest rate agreed on the loan on a monthly basis. The principal should be repaid in a lump sum when matured. As of December 31, 2022 and 2021, the effective annual interest rates were 1.69% and 1.10%, respectively.

2. Credit-based borrowings, totaling NTD 300,000 thousand, have been drawn down in full; the borrowing period was from July 20, 2022 to June 14, 2024. Since the date of borrowing, the interest should be accrued, subject to the balance of loan, at the interest rate agreed on the loan on a monthly basis. The principal should be repaid in a lump sum when matured. As of December 31, 2022, the effective annual interest rate was 1.561%.

3. For credit-based borrowings, totaling NTD300,000 thousand, NTD100,000 thousand has been drawn down; the borrowing period was from October 14, 2022 to October 14, 2025. The cyclical draw-downs were based on request forms. As of December 31, 2022, the effective annual interest rate was 1.7%.

4. For syndicated loan-based borrowings, totaling NTD 1,440,000 thousand, NTD 700,000 thousand has been drawn down from December 20, 2022 to December 20, 2025. It has been drawn down cyclically within 3 years, with interests paid on a monthly basis. As of December 31, 2022, the effective annual interest rate was 2.004%. Annual consolidated financial ratios on the said borrowings during the borrowing period are subject to the following restrictions: The current ratio remains at least 100%. The financial liabilities (less cash and cash equivalents) defined under the loan agreement in the net value of tangible assets should stay less than 110%. The interest coverage ratio (Earnings before interest, taxes and amortization of depreciation) should stay more than 2.5

5. 49 -

times. The net value of tangible assets should stay more than NT$6,200,000 thousand.

1. The syndicated loans, totaling NTD 1,250,000 thousand, have been drawn down in full. The loans were effective from October 14, 2022 to February 5, 2024 for cyclic drawdowns and the principal is to be paid off at once upon maturity. As of December 31, 2022, the effective annual interest rate was 1.817%. The restrictions imposed on the financial ratios thereof were the same as those applied to the loans from syndicated banks including Taipei Fubon Bank (7).

2. Syndicated borrowings, endorsed and guaranteed by the Company, totaling USD 36,000 thousand, have been drawn down in full; the borrowing period was July 24, 2020 through July 24, 2023. The principal was repayable by 20%, 20% and 60% upon expiration of 24 months, 30 months and 36 months from the date of the first drawdown, respectively. The interest thereon was payable once every 3 months. It was paid off early in June 2022. As of December 31, 2021, the effective annual interest rate was 1.310%–1.815%. The annual consolidated financial ratios on the loans during the effective term were subject to the following restrictions: The current ratio should stay more than 100%. The financial liabilities (less cash and cash equivalents) defined under the loan agreement in the net value of tangible assets should stay less than 110%. The interest coverage ratio (Earnings before interest, taxes and amortization of depreciation) should stay more than 2.5 times. The net value of tangible assets should stay more than NT$6,200,000 thousand.

(III) Long-term notes and bills payable

Long-term notes and bills payable
E-Sun Syndicated Loan - Guaranteed Issuance of Promissory Notes Less: Unamortized discount (stated as prepayments)	December 31, 2022 $ - - $ -	December 31, 2021
		(	$ 1,250,000 3,378) $ 1,246,622

The Consolidated Company signed the joint loan contract with syndicated banks such as E-Sun Bank on January 18, 2021. The line of credit for Item A of the said syndicated loan was NTD 625,000 thousand and that for Items B and C totaled no more than NTD 1,250,000 thousand. The loan had to be drawn down within three

• 50 -

months after the date the contract was signed. Failure to do so, the date of the first draw-down will be the end of the three months after the contract was signed. The loan given out under Item A, in particular, could be drawn down cyclically within three years after the date of the first draw-down. The end of 24 months after the date if the first draw-down was the first term. Thereafter, every six months made a term and the line of credit was reduced gradually over three terms; it was reduced by 20% for Term 1 and Term 2, respectively, and 60% for Term 3. Meanwhile, the principal was paid off at once upon expiration of the borrowing period. The loan given out under Item B could be drawn down cyclically within three years after the date of the first draw-down and the principal was paid off at once upon expiration of the borrowing period. The guaranteed line of credit for Item C could be used cyclically within three years after the date of the first draw-down. The Consolidated Company was to issue the promissory notes (stated as long-term notes and bills payable) and various payment obligations were to be fulfilled for the value shown on each note by the given maturity date. The financial ratio restrictions for the syndicated loan were the same as those applied to borrowings from the syndicated banks including E. Sun Bank (8).

E-Sun syndicated loan - guaranteed issuance of promissory notes were issued under Item C of the syndicated loan, with a contract underwriting period of 5 years; the loan period, however, may not be exceeded. As of December 31, 2022, the effective annual interest rate was 1.134%.

The loan criterion for Item B is listed as long-term borrowings starting from October 14, 2022 for the current term.

XVIII. Accounts Payable

Accounts Payable
Accounts payable Generated from operations	December 31, 2022 $ 5,660,421	December 31, 2021
			$ 5,502,050

XIX. Other liabilities

Other liabilities
Current Other payables Salary and bonus payable Repairs and maintenance payable Processing fees payable Equipment accounts payable	December 31, 2022 $ 1,176,713 315,354 194,389 383,607	December 31, 2021
		$ 905,094 306,603 228,052 268,302

• 51 -

XX.

Consumables payable Commission payable Pension fund payable Interest payable Damages payable Others Other liabilities Others Noncurrent Other liabilities Guarantee deposit received Provision for liabilities Current Sales returns and allowances	54,535 150,561 10,363 10,164 159,041 423,495 $ 2,878,042 $ 197,552 $ 105,010 December 31, 2022 $ 252,214	66,809 96,512 11,251 3,644 164,844 418,207 $ 2,469,318 $ 108,933 $ 78,056 December 31, 2021	66,809 96,512 11,251 3,644 164,844 418,207 $ 2,469,318 $ 108,933 $ 78,056 December 31, 2021
			$ 179,552

The sales returns and allowances were provided based on the amount estimated according to historical experience, the management’s judgment, and other critical factors. The provision should be debited into the operating revenue in the year in which the related goods were sold.

XXI. Post-retirement benefit plans

(I) Defined contribution plan

The Consolidated Company applied the retirement system under the “Labor Pension Act”, which was identified as the defined contribution plan managed by the government. Under the plan, the Company contributed 6% of each employee's salary to the personal account maintained at the Bureau of Labor Insurance on a monthly basis.

(II) Defined benefit plan

The pension system implemented by the Consolidated Company based on the “Labor Standards Act” is a defined benefit plan managed by the government. The pension benefits a participant receives were determined based on an employee’s number of years of service and average compensation for the six-month period prior to retirement. Those companies have an amount equivalent to 2% of the total monthly salary of employees appropriated and deposited in the specific account with Bank of Taiwan in the name of Labor Pension Reserve Committee. Before the end of

• 52 -

the fiscal year, if the pension account balance is insufficient to pay for the employees expecting to retire in the following year, the spread amount should be deposited in a lump sum before the end of March in the following year. The special account has been commissioned to the Bureau of Labor Fund of the Ministry of Labor Affairs for management. The Consolidated Company exercised no influence on the right of the Bureau in its investment management strategy.

The amount of defined benefit plan recognized in the consolidated balance sheet is shown below:

sheet is shown below:
Present value of the defined benefit obligations Fair value of the planned assets Shortfall in contribution Limit of assets Net defined benefit liabilities	December 31, 2022 $ 340,553 (267,452) 73,101 - $ 73,101	December 31, 2021
	(	(	$ 417,249 216,569) 200,680 - $ 200,680

The net defined benefit liabilities show the following changes:

Balance as of January 1, 2021 Service cost Service cost in current period Interest expenses (revenue) Recognized into profit and/or loss	Present value of the defined benefit obligations $ 466,631 971 1,986 2,957	Fair value of the planned assets ($ 197,451) - ( 1,048) ( 1,048)	Net defined benefit liabilities	Net defined benefit liabilities
		( ( (		$ 269,180 971 938 1,909

(To be continued)

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(Continued)

Re-measurement amount ROE on planned assets (except the amount of net interest) Actuarial losses －change in the assumption of the census －changes in financial assumptions －adjustment through experience Recognized into other comprehensive income Contributed by employer Benefits paid Balance as of December 31, 2021 Balance as of January 1, 2022 Service cost Service cost in current period Interest expenses (revenue) Recognized into profit and/or loss Re-measurement amount ROE on planned assets (except the amount of net interest) Actuarial losses －changes in financial assumptions －adjustment through experience Recognized into other comprehensive income Contributed by employer Benefits paid Balance as of December 31, 2022	Present value of the defined benefit obligations $ - 9,975 - ( 51,734) ( 41,759) - ( 10,580) $ 417,249 $ 417,249 1,006 2,086 3,092 - ( 37,258 ) ( 27,946) ( 65,204) - ( 14,584) $ 340,553	Fair value of the planned assets ( $ 2,402 ) - - - ( 2,402) ( 26,248 ) 10,580 ($ 216,569) ($ 216,569) - ( 1,148) ( 1,148) ( 16,859 ) - - ( 16,859) ( 47,460 ) 14,584 ($ 267,452)	Net defined benefit liabilities
			( $ 2,402 ) 9,975 - ( 51,734) ( 44,161) ( 26,248 ) - $ 200,680 $ 200,680 1,006 938 1,944 ( 16,859 ) ( 37,258 ) ( 27,946) ( 82,063) ( 47,460 ) - $ 73,101

The recognized loss of defined benefit plans by function is summarized below:

Summarization by functions Operating cost Promotional expenditure Operating expenditure	2022 $ 1,387 107 165	2021
		$ 1,359 105 168

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R&D expense	285 $ 1,944	277 $ 1,909

The pension fund system of the Consolidated Company was exposed to the following risks due to the “Labor Standards Act”:

1. Investment risk: The Bureau of Labor Fund of the Ministry of Labor Affairs uses the labor pension fund for investment in domestic and foreign equity securities and debt securities, and as bank deposits through proprietary trade or commissioned third parties. However, the amount attributable to the planned asset of the business combination shall not fall below the interest rate offered by the banks in the regions or countries of investment for 2-year time deposit as return.

2. Interest rate risk: The decrease of the interest rate of government bonds will cause the present value of the defined benefit obligations to go up; however, the return on the debt of the plan assets will go up too; therefore, they will mutually offset the impact on the net defined benefit liabilities.

3. Salary risk: The calculation of the present value of defined benefit obligation is based on the salaries of the members in the plan of the future. As such, an increase of the salaries of the members of the plan is bound to increase the present value of defined benefit obligation.

The present value of the Consolidated Company’s defined benefit liabilities was based on the actuarial calculation of the actuary and the major hypotheses as of the evaluation day are stated as following:

Discount rate Anticipated increase in salaries	December 31, 2022 1.5% 2.000%	December 31, 2021
		0.5% 2.000%

In case of reasonable and possible change in the major actuarial assumptions, and other assumptions remained unchanged, the amount of increase (decrease) in the present value of defined benefit obligation will be:

Discount rate Increase by 0.25% Decrease by 0.25% Anticipated increase in salaries Increase by 0.25% Decrease by 0.25%	December 31, 2022 ($ 8,467) $ 8,791 $ 8,578 ($ 8,303)	December 31, 2021	December 31, 2021
	( (	( (	$ 11,434) $ 11,901 $ 11,515 $ 11,123)

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Actuarial assumptions may be inter-related. The possibility of change in specific assumption is not high. Said sensitivity analysis may not be able to reflect the actual change in the present value of defined benefit obligation.

XXII. (I)	Amount projected for appropriation in 1 year Average maturity of defined benefit obligation Equity Capital stock Common stock Authorized shares (thousand) Authorized capital The number of issued and outstanding shares with paid-in capital (thousand shares) Issued and outstanding share capital	December 31, 2022 $ 25,688 10.1 years December 31, 2022 750,000 $ 7,500,000 491,839 $ 4,918,391	December 31, 2021	December 31, 2021
			$ 26,032 11.1 years December 31, 2021
				750,000 $ 7,500,000 546,488 $ 5,464,879

The stocks retained for employee stock warrants from the authorized capital stocks totaled 40,000 thousand shares.

In order to adjust the capital structure and to improve the return on shareholder equity, the Company decided through its general shareholders’ meeting on June 8, 2022 to return the share amount through capital reduction worth NTD 546,488 thousand, with 54,649 thousand shares canceled, that is, a capital reduction rate of 10%. The paid-in capital stock after capital reduction came to NTD 4,918,391 thousand, with the paid-up number of shares being 491,835 thousand. The above-said capital reduction was filed and took effect through the Tai-Zheng-Shang-(I)-Zi No. 1111803141 letter dated July 12, 2022 from the Financial Supervisory Commission and it was approved by the Board of Directors that July 15, 2022 would be the base date for capital reduction. Change registration was completed on August 4, 2022. The base date for swap of shares through capital reduction was September 16, 2022.

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(II) Capital reserve

Capital reserve
	December 31, 2022	December 31, 2021
It can be applied for making
losses, cash distribution, or
capitalization(1)
Premium in stock issuance	$ 968,615	$ 968,615
Transaction of treasury stocks	97,407	84,814
Corporate bond conversion
premium	141,359	141,359
Coupon rate for release of
corporate bond	11,715	11,715
Donated assets	71	71
	$ 1,219,167	$ 1,206,574

• (1) Such additional paid-in capital can be used to make up for losses, and, when the Company suffers no loss, can be applied for cash distribution or capitalization. However, it is limited to a certain percentage of the annual paid-in capital for the purpose of capitalization.

(III) Retained Earnings and Dividend Policy

The Company already approved the revisions made to the Articles of Association in its general shareholders’ meeting on June 8, 2022. If there is a surplus after account settlement of the fiscal year, the Company shall pay applicable taxes and cover loss carried forward, followed by the allocation of 10% of the remainder as legal reserve, and appropriate special reserve or reverse special reserve. If there is still a balance, it will be pooled up with the undistributed earnings carried forward from previous years for distribution as dividend under a motion proposed by the Board subject to the final approval in a general shareholders’ meeting. Please refer to Note XXII (VIII) “Remuneration to Employees and Directors” for the policy for distribution of remuneration to the employees and directors under the Articles of Association.

The Company's dividend policy takes the long-term business growth and investment projects into consideration, and also attends to a robust financial structure. The Board of Directors is required to propose a motion for allocation of earnings. The dividends will be distributed in the form of stock dividend or cash dividend adequate subject to the future funding needs and level of dilution of capital stocks. Among the other things, the cash dividend shall be no less than 10% of the total distribution for the current year.

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The legal reserve should be contributed until its balance reaches the Company’s total paid-in capital stock. The legal reserve can be appropriated to cover previous losses. Where the Company did not operate at a loss, the part of the legal reserve in excess of 25% of the paid-in capital could be taken as capital and may be allocated in cash as well.

The Company has special reserve appropriated and reversed in Corporation accordance with the Jin-Guan-Zheng-Fa-Zi No. 1010012865 Letter, Jin-Guan-Zheng-Fa-Zi No. 1010047490 Letter, Jin-Guan-Zheng-Fa-Zi No. 1030006415 and “Appropriation of Special Reserve Q&A after the Adoption of International Financial Reporting Standards (IFRSs).”

The Company’s 2021 and 2020 earnings distribution proposals are as follows:

Legal reserve Cash dividend Cash assigned with capital reserve Cash dividend per share (NTD)	2021 $ 296,218 $ 1,202,274 $ - $ 2.2	2020
		$ 167,997 $ 546,488 $ 273,244 $ 1.5

The cash dividends mentioned above were approved through the Board of Directors meetings on March 21, 2022 and March 22, 2021, respectively, to be distributed and earnings distribution items were decided through the general shareholders’ meetings on June 8, 2022 and July 20, 2021, respectively, too.

The 2021 earnings distribution proposal to be stipulated on March 9, 2023 by the Company’s Board of Directors is as follows:

the Company’s Board of Directors is as follows:
Legal reserve Cash dividend Cash dividend per share (NTD)	2022
	$ 463,353 $ 1,721,437 $ 3.5

(IV) Other equities

1. Exchange differences from conversion of financial reports of overseas operating entities

operating entities
Balance at start of term Incurred for the current term	2022 ( $ 27,260 )	2021
		( $ 12,702 )

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Conversion differences of overseas operating entities Other comprehensive profits or losses of current term Balance – end of period		2022 18,825 18,825 $ 8,435)	2021
	(		( 14,558 ) ( 14,558) ($ 27,260)

1. Unrealized gains or losses from financial assets measured at fair value through other combined gains or losses

other combined gains or losses
Balance at start of term Balance – end of period		2022 $ 10,570) $ 10,570)		2021
	( (		( (	$ 10,570) $ 10,570)

1. Real estate properties revaluation surplus

Balance at start of term Balance – end of period		2022 $ 295,781 $ 295,781		2021
				$ 295,781 $ 295,781

(V) Treasury stock

ry stock
Causes of Redemption Number of shares as of January 1, 2021 Number of shares as of December 31, 2021 Number of shares as of January 1, 2022 Decrease for the current term Number of shares as of December 31, 2022	The stocks of parent company held by the subsidiaries (thousand shares) 5,724 5,724 5,724 ( 573) 5,151	Total (thousand shares)
	(	(	5,724 5,724 5,724 573) 5,151

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Information on shares of the Company held by the subsidiaries as of the balance sheet date is provided as follows:

Name of subsidiary December 31, 2022 King Hsiang Investment Co., Ltd. December 31, 2021 King Hsiang Investment Co., Ltd.	Shares (thousand) 5,151 5,724	Book value $ 447,139 $ 435,005	Market price	Market price
				$ 447,139 $ 435,005

The Company’s treasury stocks may not be pledged in accordance with the Security and Exchange Law, and no privilege of dividend and voting right may be vested in them. The stocks of the Company held by the subsidiaries were treated as Treasury Stock and entitled to the rights vested in shareholders except for the privilege of cash capitalization and voting right. The Company decided to organize capital reduction in cash on July 15, 2022, the base date; the treasury stock, in particular, dropped by 573 thousand shares.

XXIII. Net profit from continuing operating units

(I) Other gains and (expenses and losses) - net

Other gains Other expenses and losses (II) Interest income Bank deposit (III) Other income Lease income Others		2022 $ 107,611 93,695) $ 13,916 2022 $ 62,826 2022 $ 11,926 81,682 $ 93,608		2021
	(		( (	$ 78,828 81,647) $ 2,819) 2021
				$ 16,385 2021
				$ 11,803 84,017 $ 95,820

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(IV) Other gains (or losses) (Loss) Gain from financial assets and financial liabilities Financial assets and financial liabilities compulsorily measured at fair value through profit or loss Net gain (or loss) from foreign currency exchange Loss on disposal of property, plant and equipment (Loss) Gain from fair value adjustment of investment property Others ) Financial cost Bank loan interest Interest of lease liabilities Other interest expenses Less: The amount of the cost of assets meeting requirements	2022 ( $ 436,596 ) 761,549 ( 34,633 ) ( 1,700 ) ( 3,118) $ 285,502 2022 $ 88,928 338 2,021 ( 972) $ 90,315	2021	2021
		$ 102,009 ( 161,356 ) ( 44,197 ) 900 ( 16,100) ($ 118,744) 2021
	(	(	$ 63,570 737 3,611 454) $ 67,464

(V) Financial cost

The information related to capitalization of interest is stated as following: 2022 2021 Amount of capitalization of interest $ 972 $ 454 Interest rate of capitalization of interest 1.37% 1.29% (VI) Depreciation and amortization 2022 2021 Summarization of the depreciation expenses by functions Operating costs $ 743,111 $ 653,210 Operating expenses 115,046 109,605 $ 858,157 $ 762,815	The information related to capitalization of interest is stated as following: 2022 2021 Amount of capitalization of interest $ 972 $ 454 Interest rate of capitalization of interest 1.37% 1.29% (VI) Depreciation and amortization 2022 2021 Summarization of the depreciation expenses by functions Operating costs $ 743,111 $ 653,210 Operating expenses 115,046 109,605 $ 858,157 $ 762,815	The information related to capitalization of interest is stated as following: 2022 2021 Amount of capitalization of interest $ 972 $ 454 Interest rate of capitalization of interest 1.37% 1.29% (VI) Depreciation and amortization 2022 2021 Summarization of the depreciation expenses by functions Operating costs $ 743,111 $ 653,210 Operating expenses 115,046 109,605 $ 858,157 $ 762,815
		$ 454 1.29% 2021
		$ 653,210 109,605 $ 762,815

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Summarization of the
amortization expenses by
functions
Operating costs	$ 13,115		$ 10,156
Operating expenses		3,110		2,745
	$ 16,225		$ 12,901
Employee benefits expenditure
		2022		2021
Post-employment benefits
(Note XXI)
Defined contribution plan	$	70,056	$	70,091
Defined benefit plan		1,944		1,909
		72,000		72,000
Resignation benefits		2,131		23
Other employee benefits		5,695,964		4,987,857
Total of employee benefit
expenses	$	5,770,095	$	5,059,880
Summarization by functions
Operating costs	$	4,394,789	$	3,879,812
Operating expenses		1,375,306		1,180,068
	$	5,770,095	$	5,059,880

(VII) Employee benefits expenditure

(VIII) Remuneration to employees and that to directors

According to the Articles of Association, no less than 5%– 10% and no more than 1% of the profit before tax and before the remuneration to employees and that to directors is deducted for the current year shall be set aside to be the remuneration to employees and that to directors. The remuneration to employees and that to directors for 2022 and 2021 was approved by the Board of Directors, respectively, on March 9, 2023 and March 21, 2022 as follows:

Estimated ratio

2023 and March 21, 2022 as follows: Estimated ratio
Remuneration to employees Remuneration to directors	2022 5.96% 0.86%	2021
		6.53% 0.95%

Amount

Amount
Remuneration to employees Remuneration to directors		2022 Cash $ 334,000 $ 48,000		2021
				Cash
				$ 240,000 $ 35,000

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If there is still change to the value after the date when annual consolidated financial reports are approved and released, it is handled as change in accounting estimates and will be adjusted and booked in the following year.

For information on the remuneration to employees and that to directors decided by the Board of Directors, please visit the Market Observation Post System of Taiwan Stock Exchange.

(IX) Gains (Losses) from foreign currency exchange

Total profit of exchange in foreign currencies Total loss of exchange in foreign currencies Net profit (loss)		2022 $ 2,289,365 1,527,816) $ 761,549		2021
	(		( (	$ 444,992 606,348) $ 161,356)

XXIV. Income tax for continuing operations

(I) Income tax recognized under gains or losses

Main components of income tax expenditure are as follows:

Income tax for the year Those incurred for the current term Undistributed earnings levied Adjustment of previous year(s) Others Deferred income tax Those incurred for the current term The income tax expenses recognized into profit and/or loss		2022 $ 1,374,441 78,230 29,977 2,988 1,485,636 334,822 334,822 $ 1,820,458	2021
			$ 878,342 43,263 ( 33,086 ) 7,257 895,776 225,888 225,888 $ 1,121,664

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The accounting income and income tax expenses are adjusted below:

		2022		2021
Net profit before tax from
continuing operation		$ 6,388,333		$ 4,048,518
Income tax expenses for net
profit before tax calculated
at the statutory tax rate		$ 2,203,789		$ 1,420,807
Expenses and losses which
could not be reduced from
tax		2,091		1,676
Income exempted from income
tax		1,881		463
Undistributed earnings levied		78,230		43,263
Land value increment tax of
investment property	(	89 )	(	1,092 )
Deductible temporary
differences not recognized	(	495,544 )	(	276,687 )
Loss credit not recognized	(	2,865 )	(	40,937 )
The income tax expenses of
previous year(s) adjusted in
the present year		29,977	(	33,086 )
Others		2,988		7,257
The income tax expenses
recognized into profit and/or
loss		$ 1,820,458		$ 1,121,664

The Consolidated Company should apply the tax rate 20% applicable to entities under the R.O.C. Income Tax Act. The tax rate, 25%, should be applied to the subsidiaries in Mainland China, while the income tax generated in any other jurisdictions should be calculated at the tax rates applicable within the jurisdictions.

(II) Income tax recognized into other comprehensive income

Deferred income tax Incurred for the year －Conversion from overseas operating institutions －Defined benefit plan re-measurement amount Income tax recognized into other comprehensive income	2022 ( $ 2,109 ) 16,413 $ 14,304		2021
			$ - 8,832 $ 8,832

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(III) Deferred income tax assets and liabilities

The deferred income tax assets and liabilities show the following changes:

2022

2022
Deferred income tax assets Temporary difference Portions of profits or losses of subsidiaries, affiliates, and joint ventures recognized adopting the equity method Loss on inventory devaluation Exchange gains or losses Financial assets at fair value through profit or loss Provision for liabilities Defined benefit retirement plan Loss in impairment in financial assets Tax difference between fixed assets and idle assets Provision of compensation loss Others Deferred income tax liabilities Temporary difference Portions of profits or losses of subsidiaries, affiliates, and joint ventures recognized adopting the equity method Financial assets at fair value through profit or loss Defined benefit retirement plan Tax difference between fixed assets and idle assets Investment property Others	Balance - beginning of year $ 123,441 22,091 1,162 - 35,717 27,999 4,500 98 34,761 48,463 $ 298,232 $ - 1,839 - 884 83,422 49,650 $ 135,795	Recognized into profit and/or loss ( $ 123,441 ) 27,310 5,426 982 ( 13,687 ) - - 342 ( 1,649 ) 8,628 ($ 96,089) $ 54,545 ( 1,839 ) 14,762 ( 821 ) ( 89 ) 147,866 $ 214,424	Recognized into other comprehensiv e income $ - - - - - ( 27,999 ) - - - 2,109 ($ 25,890) $ - - ( 11,586 ) - - - ($ 11,586)	Balance - end of year
					$ - 49,401 6,588 982 22,030 - 4,500 440 33,112 59,200 $ 176,253 $ 54,545 - 3,176 63 83,333 197,516 $ 338,633

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2021

2021
Deferred income tax assets Temporary difference Portions of profits or losses of subsidiaries, affiliates, and joint ventures recognized adopting the equity method Loss on inventory devaluation Exchange gains or losses Provision for liabilities Defined benefit retirement plan Loss in impairment in financial assets Tax difference between fixed assets and idle assets Provision of compensation loss Others Deferred income tax liabilities Temporary difference Financial assets at fair value through profit or loss Tax difference between fixed assets and idle assets Investment property Others	Balance - beginning of year $ 348,362 20,316 4,633 8,601 36,831 4,500 41,460 15,057 8,972 $ 488,732 $ - 116 84,514 176 $ 84,806	Recognized into profit and/or loss ( $ 224,921 ) 1,775 ( 3,471 ) 27,116 - - ( 41,362 ) 19,704 39,491 ($ 181,668) $ 1,839 768 ( 1,092 ) 49,474 $ 50,989	Recognized into other comprehensiv e income $ - - - - ( 8,832 ) - - - - ($ 8,832) $ - - - - $ -	Balance - end of year
					$ 123,441 22,091 1,162 35,717 27,999 4,500 98 34,761 48,463 $ 298,232 $ 1,839 884 83,422 49,650 $ 135,795

(IV) The deductible temporary differences and unused loss credit of the deferred income tax assets that are not recognized in the consolidated balance sheet

Offset of loss Due in 2022 Due in 2023 Deductible temporary differences Overseas subsidiaries Others	December 31, 2022 $ - - $ - $ 2,800,000 - $ 2,800,000	December 31, 2021	December 31, 2021
			$ 155,181 560,579 $ 715,760 $ 1,260,000 202,263 $ 1,462,263

• (V) Compiled amount of temporary differences relevant to investments without recognition of deferred income tax liabilities

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As of December 31, 2022, temporary differences relevant to investments in subsidiaries without recognition of deferred income tax liabilities were NTD4,028,000 thousand.

(VI) Authorization of income tax

Business income tax filed by the Company and Gold Circuit Investment Company as of 2019 has been finalized by the tax authority.

XXV. Earnings Per Share

Earnings Per Share
Basic EPS Diluted earnings per share		2022 $ 8.86 $ 8.78	Unit: NTD per share 2021 $ 5.41 $ 5.38

The weighted average number of common shares used to calculate the earnings in the earnings per share (EPS) are enumerated below:

Net profit of the year

Net profit of the year
The net profit of owner attributed to the Company Net profit used to calculate the basic and diluted earnings per share Share(s) The weighted average number of common shares to be used to calculate basic earnings per share (EPS) Impacts of potential common stock with diluting effects: Remuneration to employees Weighted average number of common stock shares used to calculate the diluted earnings per share (EPS)		2022 $ 4,567,875 $ 4,567,875 2022 515,578 4,578 520,156

If the Consolidated Company may choose to issue employee remunerations in the

form of shares or cash, in the calculation of diluted earnings per share, it is assumed that issuance of shares will be adopted for employee remunerations and the weighted

• 67 -

average circulating shares are included in the calculation when the said common stock exercises the diluting effect in order to calculate the diluted earnings per share. When diluted earnings per share are calculated prior to issuance of shares as employee remunerations as determined in the following year, the diluting effect from the said potential common stock shall continue to be taken into consideration, too.

XXVI. Capital risk management

The Consolidated Company managed their capitals to assure that, insofar as various entities within the Group continued operations, the returns to shareholders could be maximized through optimal balances in liabilities and equity.

The Consolidated Company’s capital structure consisted of their net debts (namely the loans less cash and cash equivalents) and equity (namely the capital stock, additional paid-in capital, retained earnings and other equity less treasury stocks).

It was not necessary for the Consolidated Company to comply with any other external capital requirements.

XXVII. Financial instruments

• (I) Fair value - financial instruments that are not measured at fair value

• The management of the Consolidated Company believed that the financial

• assets and financial liabilities not measured at fair value were close to the fair value thereof. Until December 31, 2022 and 2021, there have no significant difference between the book value and fair value.

• (II) Information on fair value – financial instruments measured at fair value on a recurring basis

• Fair value hierarchy December 31, 2022

ing basis Fair value hierarchy December 31, 2022
Financial assets at fair value through profit or loss Derivative financial instruments Non-derivative financial instruments －TWSE/TPEx-listed and emerging stocks Total		Degree I $ - 3,136 $ 3,136		Degree II $ 40,166 - $ 40,166		Total
						$ 40,166 3,136 $ 43,302

• 68 -

Financial liabilities at fair value through profit or loss Derivative financial instruments December 31, 2021 Financial assets at fair value through profit or loss Derivative financial instruments Non-derivative financial instruments －TWSE/TPEx-listed and emerging stocks Total		$ - Degree I $ - 4,240 $ 4,240		$ 4,908 Degree II $ 21,451 - $ 21,451		$ 4,908 Total
						$ 21,451 4,240 $ 25,691

There was no transfer between fair value measurement Degree 1 and Degree 2 in 2022 and 2021.

1. Evaluation techniques and an input value of Degree 2 fair value measurement

Categories of financial instruments Evaluation techniques and input values Derivative financial Discounted cash flow approach: Future cash instruments - Forward flows are estimated based on observable foreign exchange forward exchange rates and contractual contracts & FX swaps forward exchange rates, discounted at a rate contracts that reflects the credit risk of various trading counterparts. Non-TWSE/TPEx-listed Market approach: Evaluated based on other stocks comparable asset liabilities and critical information.

(III) Categories of financial instruments

Categories of financial instruments
Financial assets At fair value through profit or loss At fair value through profit or loss compulsorily Financial liabilities measured at amortized cost (Note 1) Financial liabilities	December 31, 2022 $ 43,302 16,855,084	December 31, 2021
		$ 25,691 13,075,251

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At fair value through profit or loss At fair value through profit or loss compulsorily Measured at post-amortization cost (Note 2)	December 31, 2022 4,908 14,172,023	December 31, 2021
		- 12,517,879

• Note 1: The balances included the financial assets at amortized costs, such as cash & cash equivalents, time deposit with initial maturity date more than three months away, notes receivable, accounts receivable, other receivables and refundable deposits.

• Note 2: The balance includes financial liabilities measured at amortized cost, such as short-term loans, short-term notes and bills payable, notes payable, accounts payable, other payables, long-term borrowings (including those due within a year), and guarantee deposits received.

• (IV) The objectives and policies of financial risk management

The Consolidated Company manages the foreign currency exchange rate risk, interest rate risk, and the price risk, credit risk, and liquidity risk of equity instruments in order to minimize the potential undesirable impacts of uncertainties on the market on the financial performance of the Company. Important financial planning of the Company is subject to review by the Audit Committee and/or the Board of Directors according to applicable regulations and the internal control system. When implementing a financial plan, the Company strictly follows applicable financial standards for the management of financial risk and division of responsibilities.

The Consolidated Company hedged against the exposure through derivative financial instruments, in order to mitigate the effect posed by such risks. The application of derivative financial instruments was governed by the policies passed by the Consolidated Company’s board of directors, as the written principles for application of foreign risk, interest risk, credit risk, derivative financial instruments and non-derivative financial instruments and residual current fund. The internal auditors kept rechecking the compliance with the policies and limit of exposure. The Consolidated Company never engaged in transactions of financial instruments

• 70 -

(including derivative financial instruments) for the purpose of any speculative operations.

1. Market risk

The major financial risks incurred by operating activities to be borne by the Consolidated Company include the risk of change in the foreign exchange rate (see (1) below) and risk of change in the interest rate (see (2) below). The Consolidated Company deals with various derivatives in order to manage the foreign exchange rate and interest rate risks it undertakes, including the hedge against the exchange rate risk arising from export sales with forward foreign exchange and FX swaps contracts.

The Consolidated Company’s exposure to the market risk over related financial instruments and the management and measurement methods adopted by the Consolidated Company with respect to the risk remained unchanged.

• (1) Foreign exchange rate risk

Several subsidiaries of the Company engaged in foreign currency-denominated sales and purchases, which exposed the Consolidated Company the risk of foreign exchange rate changes therefor. About 97.59% of the Consolidated Company’s sales were not denominated in the functional currency adopted by the group entity engaged in the relevant transaction. About 37.07% of the costs of goods sold were not denominated in the functional currency adopted by the group entity engaged in the relevant transaction. Insofar as it is permitted by policies, the Consolidated Company utilized forward foreign exchange contracts to help manage the risk.

For the book value of the Consolidated Company’s non-functional currency-denominated monetary assets and liabilities (including the non-functional currency-denominated monetary items already written off in the consolidated financial statements), please see Note XXX.

Sensitivity analysis

The Consolidated Company were primarily exposed to the fluctuation in foreign exchange rates in USD and JPY.

The following table details the Consolidated Company’s sensitivity analysis in the case of the increase or decrease in NTD, USD, and CNY (functional currency) against the relevant foreign currency by 2%. 2%

• 71 -

means the sensitivity ratio applied by the Consolidated Company when they reported the foreign exchange rate risk to the management within the Group, and also the management’s evaluation on reasonable changes of the foreign exchange rate. The sensitivity analysis only covers outstanding foreign currency monetary items and forward foreign exchange contracts designated to hedge against cash flows, and their conversions at the end of the year are adjusted by the change in exchange rate of 2%. The positive figures in the following table indicate the amount decreased for the net profit before tax when NTD appreciates by 2% versus respective related currencies; when NTD depreciates by 2% versus respective foreign currencies, the impacts on the net profit before tax will be the negative of the same amount.

Exchange gains or losses	Effect of USD 2022 2021 ( $ 203,627 ) (i) ( $ 135,358 ) (i)	Effect of JPY	Effect of JPY
	2022 ( $ 203,627 ) (i)	2022 $ 1,133 (ii)	2021
			$ 63 (ii)

• (i) Primarily as a result of the Consolidated Company’s receivables, payables and loans which were denominated in USD and still outstanding on the balance sheet date, without hedging against cash flows.

• (ii) Primarily as a result of the Consolidated Company’s receivables, payables and loans which were denominated in JYP and still outstanding on the balance sheet date, without hedging against cash flows.

The Consolidated Company’s sensitivity to exchange rates declined for the current term, primarily as a result of the increase in the bank loans denominated in USD of subsidiaries that led to the decrease in balance of net assets of the Consolidated Company denominated in USD.

• (2) Interest rate risk

The interest rate risk arose as a result of the loans bearing interest accruing at fixed interest rate and floating interest rate borrowed by the Consolidated Company. The Consolidated Company manages the interest rate risk by maintaining a suitable combination of fixed and floating interest rates.

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The book values of the Consolidated Company’s financial assets and financial liabilities with exposure to interest rates on the balance sheet date are stated as following:

With fair value interest rate risk －Financial liabilities With cash flow interest rate risk －Financial assets －Financial liabilities	December 31, 2022 $ 15,394 6,019,077 5,528,434	December 31, 2021
		$ 32,457 3,848,807 4,468,456

Sensitivity analysis

The following analyses of sensitivity were determined based on the interest rate risk exposure if derivative and non-derivative financial instruments on the balance sheet dates. For liabilities at floating rate, the analysis was prepared under the assumption that the amount of the liabilities outstanding on the balance sheet date was outstanding during the reporting period. 50 base points mean the interest rate change ratio applied by the Group when reporting interest rates to the management, and also the management’s assessment of the reasonable possible range of change to the interest rate.

If the interest rate increases/decreases by 50 base points and all the other variables remain unchanged, the Consolidated Company’s net profit before tax would decrease/increase by NTD 442 thousand and NTD 5,002 thousand, respectively, for 2022 and 2021 primarily as a result of the Consolidated Company’s exposure to the risk of change in interest rates for demand deposits and borrowings.

2. Credit risk

The credit risk denotes the risk that the Consolidated Company might incur a loss when the trading counterparts default the obligations under the contracts. As of the balance sheet date, the top credit risk the Consolidated Company might be exposed to from the financial loss caused by the counterpart failing to fulfill obligations or the financial guarantee provided by

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the Consolidated Company primarily came from the book value of notes and accounts receivable recognized on the Consolidated Balance Sheet. Operation-related Credit Risk

The outstanding accounts receivable of the Consolidated Company mainly come from customer bases around the world and no collaterals or credit guarantee is provided for most accounts receivable. Despite the related procedures defined by the Company to help supervise, manage, and reduce the credit risk of accounts receivable, there is no guarantee that such procedures can fully prevent against losses caused by credit risk. With economic conditions getting worse, such credit risk will increase. As of December 31, 2022 and 2021, the ratios of the balance of accounts receivable from Top 10 customers to the balance of accounts receivable of the Company had been 74% and 72% while the credit risk of the other accounts receivable was relatively insignificant.

3.

In order to mitigate the credit risk, on the balance sheet date, the Consolidated Company would recheck on a case-by-case basis the recoverable amount of notes and accounts receivable to assure that for the notes and accounts receivable which were not recoverable, appropriate impairment loss has been duly amortized. Accordingly, the Company’s management held that the Consolidated Company’s credit risks had been significantly mitigated. Liquidity risk

The Consolidated Company managed and maintained sufficient cash and cash equivalent to support the Group’s business operations and minimize the impact of changes in cash flow. The Consolidated Company’s management closely watches the usage of the financing credit lines in banks and assures faithful compliance of the terms and conditions set forth under the loan contracts.

To the Consolidated Company, bank loans functioned as a key source of liquidity. Please refer to Note (2) “Financing limit” .

(1) Liquidity and interest rate risk of non-derivative financial liabilities

Non-derivative financial liabilities remaining contract maturity analysis was prepared in accordance with the earliest payment date expected of the Consolidated Company and the undiscounted cash flows (including principal and estimated interest) of financial liabilities.

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Therefore, the Consolidated Company may be required to immediately repay the bank loan that is illustrated in the following table without considering the probability that the bank may immediately exercise such right. The other non-derivative financial liabilities maturity analysis was prepared on the agreed repayment date.

The undiscounted interest for the cash flow of interest payable at floating interest rate derived from the bond yield curves at the balance sheet date.

December 31, 2022

Liabilities without interest Lease liabilities Floating interest rate instruments Fixed interest rate instruments	Repayment on demand or less than 1 months	Repayment on demand or less than 1 months		1 month ~ 3 months	3 months ~ 1 year	3 months ~ 1 year	1 year~5 years	1 year~5 years		Over 5 years
		$ 759,650 1,472 573,597 - $ 1,334,719		$ 4,065,705 2,951 607,770 - $ 4,676,426		$ 1,986,029 7,861 1,007,067 - $ 3,000,957		$ 537,736 3,110 - 3,340,000 $ 3,880,846		$ - - - - $ -

The other information about lease liabilities maturity analysis is stated as following:

Lease liabilities	Less than 1 year	Less than 1 year		1 year~5 years	5 years~10 years	5 years~10 years	10 years~15 years	10 years~15 years	15 years~20 years	15 years~20 years		Over 20 years
		$ 12,284		$ 3,110		$ -		$ -		$ -		$ -

December 31, 2021

Liabilities without interest Lease liabilities Floating interest rate instruments Fixed interest rate instruments	Repayment on demand or less than 1 months	Repayment on demand or less than 1 months		1 month ~ 3 months	3 months ~ 1 year	3 months ~ 1 year	1 year~5 years	1 year~5 years		Over 5 years
		$ 310,141 1,425 217,265 - $ 528,831		$ 4,157,460 2,856 646,264 - $ 4,806,580		$ 2,175,041 12,965 477,677 - $ 2,665,683		$ 410,088 15,300 - 3,127,250 $ 3,552,638		$ - - - - $ -

The other information about lease liabilities maturity analysis is stated as following:

Less than 1 1 year~5 5 years~10 10 years~15 15 years~20 Over 20 year years years years years years Lease liabilities $ 17,246 $ 15,300 $ - $ - $ - $ -

(2) Financing limit

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Unsecured bank overdraft (to be reviewed annually) －Already drawn down －Not yet drawn down Secured bank overdraft －Already drawn down －Not yet drawn down	December 31, 2022 $ 4,129,795 6,715,144 $ 10,844,939 $ 1,398,641 1,561,692 $ 2,960,333	December 31, 2021	December 31, 2021
			$ 3,289,762 6,475,759 $ 9,765,521 $ 1,178,694 1,287,890 $ 2,466,584

XXVIII. Transactions-related party

Upon consolidation, the transactions, balances in accounts, gains, expenses and losses existing between the Company and its subsidiaries (as the Company's related parties) were written out in full and, therefore, are not disclosed in this Note.

Remuneration to the Management

Remuneration to the Management
Short-term employee benefits Benefits after severance/retirement		2022 $ 90,911 1,512 $ 92,423		2021
				$ 77,476 1,485 $ 78,961

The salaries and remunerations to directors and other key management were determined by the Salary Committee in accordance with the personal performances and trends in the markets:

XIX. Pledged assets

The following assets were provided as collateral for financing loans and for the tariffs of imported raw materials and supplies:

Land Building - net Right-of-use assets	December 31, 2022 $ 648,300 545,072 117,300 $ 1,310,672	December 31, 2021	December 31, 2021
			$ 648,300 604,544 118,764 $ 1,371,608

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XXX. Important Matters

The amount of unused letters of credit issued by the Consolidated Company for procurement of raw materials and machinery & equipment are enumerated as following (expressed in NTD thousand):

(expressed in NTD thousand):
Currency type JPY EUR USD	December 31, 2022 $ 29 177 9,740	December 31, 2021
		$ 13,460 802 131

XXXI. Information about financial assets and liabilities in foreign currencies with significant influence:

The following information was summarized according to the foreign currencies other than the functional currencies of the Consolidated Company. The exchange rates disclosed was used to translate the foreign currencies into the functional currency. Financial assets and liabilities in foreign currencies with significant influence are summarized as following:

December 31, 2022

Foreign currency assets Monetary items USD USD CNY EUR EUR JPY Foreign currency liabilities Monetary items USD USD CNY EUR JPY JPY	Foreign currency $ 415,211 254,661 3,513 887 1,954 64,400 Foreign currency $ 266,420 71,919 22 2,302 243,860 64,400	Exchange rate 30.71(USD:NTD) 6.9646 (USD:CNY) 4.408(CNY:NTD) 32.72(EUR:NTD) 7.4229 (EUR:CNY) 0.2324 (JPY:NTD) Exchange rate 30.71 (USD: NTD) 6.9646 (USD: CNY) 4.408(CNY: NTD) 32.72 (EUR: NTD) 0.2324 (JPY: NTD) 0.0524 (JPY: CNY)		Book value
				$ 12,751,130 7,820,639 15,485 29,023 63,935 14,967 $ 20,695,179 Book value
				$ 8,181,758 2,208,632 97 75,321 56,673 14,967 $ 10,537,448

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December 31, 2021

Foreign currency assets Monetary items USD USD CNY EUR EUR Foreign currency liabilities Monetary items USD USD EUR JPY	Foreign currency $ 367,934 217,393 39,064 900 3,081 240,564 100,258 1,149 13,190	Exchange rate 27.68 (USD: NTD) 6.376 (USD: CNY) 4.341 (CNY: NTD) 31.32 (EUR: NTD) 7.2197 (EUR: CNY) 27.68 (USD: NTD) 6.376(USD: CNY) 31.32 (EUR: NTD) 0.2405 (JPY: NTD)		Book value
				$ 10,184,413 6,017,438 169,596 28,188 96,497 $ 16,496,132 $ 6,658,812 2,775,141 35,987 3,172 $ 9,473,112

XXXII. Noted disclosures

• (I) Information related to material transactions and (II) information related to reinvested enterprises:

• Fund loaned to others: See Attachments 1 and 6.

• Endorsement and guarantee made for others: See Attachment 2.

• Marketable securities-end (exclusive of investments in subsidiaries, affiliated companies, and joint ventures): See Attachments 3 and 7.

• Cumulative amount of the same marketable security purchased or sold reaching NTD300 million or more than 20% of the paid-in capital: N/A.

• Acquisition amount of real estate reaching NTD300 million or more than 20% of the paid-in capital: N/A.

• Amount on disposal of real estate reaching NTD300 million or more than 20% of the paid-in capital: N/A.

• Purchase/sale amount of transactions with related parties reaching NTD100 million or more than 20% of the paid-in capital: See Attachments 4 and 8.

• Accounts receivable-related party reaching NTD100 million or more than 20% of the paid-in capital: See Attachment 9.

• Engagement in trading of derivatives: Note VII.

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• Other information: Amount of the business relationship and major transactions between parent company and subsidiaries and among subsidiaries: See Attachment 12.

• Information related to reinvested enterprises: See Attachment 5.

• (III) Information about investment in Mainland China

• The name of the investee in Mainland China, main items involved in the scope of operation, paid-in capital size, investment method, capital importation/exportation, holding ratio, investment profits and losses, book value of investments at end of term, repatriated investment profits or losses, and investment ceiling value for Mainland China: Attachment 10.

• Any of the following significant transactions with investees in Mainland China, either directly or indirectly through the enterprise in a third area, and their prices, payment terms, and unrealized gains or losses: See Attachment 11.

• Direct, or indirect through a third region endorsement, guarantee or provision of collateral made with the investee in the Mainland China: Attachment 2.

• Direct, or indirect, via the enterprise in a third area, financing with the investees in the Mainland China: See Attachment 6.

• Other transactions that produce material effects to the income or financial condition in the current period: N/A.

• (IV) Information of major shareholders: Names and shareholding quantities and ratios of shareholders that hold at least 5% of the equity: Attachment 13.

XXXIII. Information by Segment

The Consolidated Company primarily engaged in manufacturing, processing and trading printed circuit boards from the same production process, in the similar manner in the similar market. Meanwhile, the business decision makers also allocated resources among all of the companies as a whole. Therefore, all of the companies should constitute one single industry segment, and there should be no need to disclose the information by segment.

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Gold Circuit Electronics Ltd. and its subsidiaries

Fund loaned to others

January 1 to December 31, 2022

Attachment 1

Unit: NT$ thousand, USD thousand, and CNY thousand

No. (Note 1)	Loaner	Debtor	Accounting title	Whether a related party or not	Maximum balance for the current period	Balance – end of period	Amount actually disbursed	Interest rate interval	Nature of loan (Note 2)	Amount of current business (Note 4)	Reasons for short-term financing	Allowance for bad debt	Collateral	Collateral	Limit of lending to an individual debtor (Note 3)	Limit of total lending (Note 3)
													Title	Value
0	Gold Circuit Electronics Ltd.	Changshu Gold Circuit Technology Co., Ltd.	Other receivables	Y Y	$ 161,075 ( USD 5,000 ) 155,365 ( CNY 35,000 )	$ - ( USD - ) - ( CNY - )	$ - ( USD - ) - ( CNY - )	1.5000% ~1.5000% 3.7000% ~3.7000%	(1) (1)	$ 1,687,159 1,687,159	－ －	$ - -	－ －	$ - -	$ 1,687,159 1,687,159	$ 5,373,814 5,373,814

Note 1: The sections are completed in the following manners:

• (1) “0” for the issuer.

• (2) Investees are numbered from number 1 and so on.

• Note 2: The fund loaned to others is categorized two types as following by nature:

• (1) Business association

• (2) Short-term financing needed

Note 3: The total funds lent by the Company to others may not exceed 40% of the Company's net value in the most recent financial statements audited or certified by the CPAs (for Q3 of 2022).

• The limit on loans extended to any single borrower is defined as following based on the cause of loaning:

• (1) For the borrower trading with the Company, the limit on loans shall be no more than the purchase or sales by the Company from or to the borrower in the most recent year or until the loaning of fund in current year, whichever is higher.

(2) Where short-term financing is needed, the limit of funds lent may not exceed 40% of the Company's net value in the most recent financial statements audited or certified by the CPA (for Q3 of 2022).

Note 4: The amount refers to the amount of purchases or that of sales between the Company and Changshu Gold Circuit Technology Ltd. over the past year, whichever is higher.

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Gold Circuit Electronics Ltd. and its subsidiaries

Endorsement and guarantee made for others

January 1 to December 31, 2022

Attachment 2

Unit: NTD thousand, USD thousand, CNY thousand, EUR thousand

No.	Endorsement and guarantee Name	Counterpart	Counterpart	Limit of endorsement/guaran tee on particular enterprise (Note 1)	Maximum balance of endorsement / guarantee made during the current period	Balance of endorsement / guarantee at end of the period	Amount actually disbursed	Endorsement/guara ntee secured by property	Accumulated ratio of the value of endorsement and guarantee in the net worth of financial statements of the most recent term (%)	Maximum limit of endorsement/ guarantee (Note 2)	As the parent company’s endorsements/ guarantees toward subsidiary(ies) (Note 3)	As a subsidiary’s endorsements/ guarantees toward its parent company (Note 3)	As the endorsements/ guarantees toward the Mainland China area. (Note 3)
		Name	Affiliation
0	Gold Circuit Electronics Ltd.	Goldex Holding Limited Gold Circuit International Limited Gold Circuit Enterprise Limited Suzhou Gold Circuit Electronics Ltd. Changshu Gold Circuit Electronics Ltd. Changshu Gold Circuit Technology Co., Ltd.	Subsidiary wholly invested in by the Company directly Company wholly invested in via a subsidiary indirectly Company wholly invested in via a subsidiary indirectly Company wholly invested in via a subsidiary indirectly Company wholly invested in via a subsidiary indirectly Company wholly invested in via a subsidiary indirectly	$ 10,075,901 10,075,901 10,075,901 10,075,901 10,075,901 10,075,901 10,075,901	$ 1,915,875 ( USD 65,000 ) 163,600 ( EUR 5,000 ) 257,720 ( USD 8,000 ) 644,300 ( USD 20,000 ) 683,820 ( USD 23,200 ) 458,000 ( USD 16,000 ) 149,700 ( USD 5,000 )	$ 706,330 ( USD 23,000 ) 163,600 ( EUR 5,000 ) 245,680 ( USD 8,000 ) 614,200 ( USD 20,000 ) 614,200 ( USD 20,000 ) 245,680 ( USD 8,000 ) - ( USD - )	$ - ( USD - ) - ( EUR - ) - ( USD - ) - ( USD - ) 307,100 ( USD 10,000 ) - ( USD - ) - ( USD - )	$ - - - - - - -	5.26 1.22 1.83 4.57 4.57 1.83 -	$ 20,151,803 20,151,803 20,151,803 20,151,803 20,151,803 20,151,803 20,151,803	Y Y Y Y Y Y Y	N N N N N N N	Ｎ Ｎ Ｎ Ｎ Ｙ Ｙ Ｙ

Note 1: The amount of endorsement/guarantee made by the Company for a single enterprise may not exceed 75% of the net value for the current term. The maximum of endorsement/guarantee on December 31, 2022 is obtained with 75% of the net value of the Company for the current term. The net value is based on that shown in the most recent financial statements audited and certified or reviewed by the CPA (for Q3 of 2022).

Note 2: The total amount of endorsements/guarantees made by the Company externally may not exceed 150% of the net value for the current term. The maximum of endorsement/guarantee on December 31, 2022 is obtained with 150% of the net value of the Company for the current term. The net value is based on that shown in the most recent financial statements audited and certified or reviewed by the CPA (for Q3 of 2022).

Note 3: Enter Y only in the case of the parent company’s endorsements/guarantees toward subsidiary(ies), a subsidiary’s endorsements/guarantees toward its parent company, and the endorsements/guarantees toward the Mainland China area.

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Gold Circuit Electronics Ltd. and its subsidiaries

Marketable securities held – end of year

December 31, 2022

Attachment 3

Unit: NTD thousand

Holder	Type and name	Relationship with the issuer	Account title			End ofperiod	End ofperiod			Remarks
				Number of shares		Book value	Equity (%)		Fair value
Gold Circuit Electronics Ltd. 〃 〃 〃 〃	Stock AMB Technology Co., Ltd ULTRA PRECISION TECHNOLOGY COMPANY King Hsiang Investment Co., Ltd. Goldex Holding Limited	－ － Subsidiary Subsidiary	Financial assets at fair value through other comprehensive income - noncurrent Financial assets at fair value through other comprehensive income - noncurrent Long-term equity investment under equity method Long-term equity investment under equity method	267,857 1,000,000 19,999,400 191,910,000		$ - - $ - $ 41,910 8,082,246 $ 8,124,156	1.984 10.290 99.997 100.000		$ - - $ - $ 41,910 8,082,246 $ 8,124,156

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Gold Circuit Electronics Ltd. and its subsidiaries

Purchase/sale amount of transactions with related parties reaching NT$100 million or more than 20% of the paid-in capital

January 1 to December 31, 2022

Attachment 4

Unit: NTD thousand

Supplier (customer)	Trading counterpart	Affiliation		Status	Status		Distinctive terms and conditions of trade and the reasons	Distinctive terms and conditions of trade and the reasons	Notes/accounts receivable (payable)	Notes/accounts receivable (payable)	Remarks
			Purchase (sale)	Amount	Percentage in total purchase (sale) amount %	Duration	Unit price	Duration	Balance	Percentage in total accounts/notes receivable (payable) %
Gold Circuit Electronics Ltd. Gold Circuit Electronics Ltd. Gold Circuit Electronics Ltd. Gold Circuit Electronics Ltd.	Suzhou Gold Circuit Electronics Ltd. Suzhou Gold Circuit Electronics Ltd. Changshu Gold Circuit Electronics Ltd. Changshu Gold Circuit Technology Co., Ltd.	Company wholly invested in via a subsidiary indirectly Company wholly invested in via a subsidiary indirectly Company wholly invested in via a subsidiary indirectly Company wholly invested in via a subsidiary indirectly	Purchase Sales Purchase Purchase	$ 11,493,931 105,564 6,283,149 1,687,159	44 - 24 6	O/A 3 months O/A 4 months O/A 4 months O/A 3 months	- - - -	－ － － －	( $ 4,402,324 ) 73,778 ( 1,137,871 ) ( 184,526 )	56 1 14 2

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Gold Circuit Electronics Ltd. and its subsidiaries

Information related to the reinvested companies… such as names and locations, etc.

January 1 to December 31, 2022

Attachment 5

Unit: NTD thousand

Investor	Investee	Location	Principal business	Original investment cost	Original investment cost	Holdings at end ofyear	Holdings at end ofyear	Holdings at end ofyear	Investment gain (loss) of the investee	Investment gain (loss) recognized for the current period (Note1)	Remarks
				End of the current period	End of the previous period	Number of shares	Percentage (%)	Book value
Gold Circuit Electronics Ltd. 〃 Goldex Holding Limited 〃 Gold Circuit International Limited Gold Circuit Enterprise Limited 〃	King Hsiang Investment Co., Ltd. Goldex Holding Limited Gold Circuit International Limited Gold Circuit Enterprise Limited Suzhou Gold Circuit Electronics Ltd. Changshu Gold Circuit Electronics Ltd. Changshu Gold Circuit Technology Co., Ltd.	No. 149-1, Zhong Zeng Rd., Tamsui Dist, New Taipei City Trust Net Chambers Lotemau Centre, P.O. Box 1225, Apia, Samoa P.O. Box 362, Road Town, Tortola, Virgin islands, British Turst Net Chambers Lotemau Centre, P.O.Box 1225, Apia, Samoa No. 238, Jinfeng Road, New District, Suzhou City, Jiangsu Province No. 9, Jiulong Rd., Changshu Southeast Economic Development Zone, Jiangsu Province No. 816, Southeast Avenue, Changshu Hi-Tech Industrial Development Zone, Jiangsu Province	General investment business 〃 〃 〃 Design, produce and sell multi-layer printed circuit boards 〃 〃	$ 199,994 6,271,398 3,239,310 2,670,554 3,239,310 959,724 980,105	$ 199,994 6,271,398 3,239,310 2,670,554 3,239,310 959,724 980,105	19,999,400 191,910,000 98,000,000 93,010,000 98,000,000 30,010,000 33,000,000	99.997 100.000 100.000 100.000 100.000 100.000 100.000	$ 41,910 8,082,246 5,378,665 2,874,250 5,540,740 3,194,603 ( 719,981 )	$ 22,686 3,465,490 2,592,764 881,884 2,596,784 890,011 ( 6,521 )	$ (7,763) 3,377,929 2,529,073 858,013 2,533,093 855,608 4,011	(Note 2)

Note 1: The investment gain (loss) recognized for the current period has taken into consideration the effects of unrealized (realized) gross losses on sales among reinvested companies.

Note 2: The investment loss of King Hsiang Investment Co., Ltd. recognized for the current term, NTD 7,763 thousand, includes the investment gain recognized adopting the equity method, NTD 22,686 thousand, and reversal of the financial asset appraisal gain, NTD 17,857 thousand for King Hsiang Investment Co., Ltd. from holding the Company’s shares under the “Accounting Principles for Management of Treasury Stocks” and receipt of the income from dividends issued by the Company worth NTD 12,592 thousand.

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Gold Circuit Electronics Ltd. and its subsidiaries

Fund loaned by investees to others

January 1 to December 31, 2022

Table 6

Unit: NT$ thousand, USD thousand, and CNY thousand

No.	Loaner	Debtor	Contents	Maximum balance for the current period	Balance – end of period	Amount actually disbursed - end of period	Interest rate range (%)	Nature of loan (Note 1)	Amount	Reasons for short-term financing	Allowance for bad debt	Collateral	Collateral	Limit of lending to an individual debtor (Note 2)	Limit of total lending (Note 2)
												Title	Value
1 2 3 4	Goldex Holding Limited Changshu Gold Circuit Electronics Ltd. Suzhou Gold Circuit Electronics Ltd. Gold Circuit Enterprise Limited	Changshu Gold Circuit Technology Co., Ltd. Changshu Gold Circuit Electronics Ltd. Suzhou Gold Circuit Electronics Ltd. Gold Circuit International Limited Gold Circuit Enterprise Limited Changshu Gold Circuit Technology Co., Ltd. Changshu Gold Circuit Technology Co., Ltd. Changshu Gold Circuit Technology Co., Ltd. Gold Circuit International Limited	Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables Other receivables	$ 624,120 ( USD 21,000 ) 265,275 ( USD 9,000 ) 147,375 ( USD 5,000 ) 170,740 ( USD 5,300 ) 109,531 ( USD 3,400 ) 901,200 ( CNY 200,000 ) 241,613 ( USD 7,500 ) 803,140 ( USD 26,000 ) 79,846 ( USD 2,600 )	$ - ( USD - ) - ( USD - ) - ( USD - ) 92,130 ( USD 3,000 ) - ( USD - ) 881,600 ( CNY 200,000 ) 230,325 ( USD 7,500 ) 798,460 ( USD 26,000 ) 79,846 ( USD 2,600 )	$ - ( USD - ) - ( USD - ) - ( USD - ) 92,130 ( USD 3,000 ) - ( USD - ) 870,190 ( CNY 197,412 ) 230,325 ( USD 7,500 ) 798,460 ( USD 26,000 ) 79,846 ( USD 2,600 )	1.422%~3.534% 1.440%~2.702% 1.476%~1.808% 1.500%~4.593% 1.445%~3.129% 0.800%~3.700% 0.800%~0.800% 1.500%~4.200% 4.000%~4.000%	(2) (2) (2) (2) (2) (2) (2) (2) (2)	$ - - - - - 23,227 23,227 166,054 -	Working capital Working capital Working capital Working capital Working capital Working capital Working capital Working capital Working capital	$ - - - - - - - - -	－ － － － － － － － －	$ - - - - - - - - -	$ 22,934,449 22,934,449 22,934,449 22,934,449 22,934,449 5,443,658 5,443,658 7,315,635 8,296,442	$ 22,934,449 22,934,449 22,934,449 22,934,449 22,934,449 5,443,658 5,443,658 7,315,635 8,296,442

Note 1: The fund loaned to others is categorized two types as following by nature:

(1) Business association

(2) Short-term financing needed

Note 2: The amount of funds lent to a single borrower and the total amount of funds lent to others by a reinvestee (except Goldex Holding Limited and Gold Circuit Enterprise Limited) shall not exceed 150% of the reinvestee’s net value in its most recent financial statements audited or certified by the CPA (for Q3 of 2022). The amount of funds lent to a single borrower and the total amount of funds lent to others by Goldex Holding Limited and Gold Circuit Enterprise Limited shall not exceed 300% of their net value in their most recent financial statements audited or certified by the CPA (for Q3 of 2022).

The limit of funds lent to a single borrower and the total amount of funds lent to others by a subsidiary in Mainland China shall not exceed 150% of the reinvestee's net value in its most recent financial statements audited or certified by the CPA (for Q3 of 2022). Note 3: The interest rate interval for the fund loaned in 2022

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Gold Circuit Electronics Ltd. and its subsidiaries

Marketable securities held by investees - end of period

December 31, 2022

Attachment 7

Unit: NTD thousand

Holder	Type and name	Affiliation to the issuer	Account title			End ofperiod	End ofperiod			Remarks
				Number of shares		Book value	Equity (%)		Fair value
King Hsiang Investment Co., Ltd. 〃 〃	Stock LEE CHI ENTERPRISE CO., LTD. Gold Circuit Electronics Ltd.	－ The parent company in which King Hsiang Investment Co., Ltd. held 99.997% shares	Financial assets at fair value through profit or loss - current Financial assets at fair value through profit or loss - current	155,595 5,151,375		$ 3,135 447,140 $ 450,275	0.068 1.047		$ 3,135 447,140 $ 450,275

• 86 -

Unit: NTD thousand

Gold Circuit Electronics Ltd. and its subsidiaries

Purchase/sale amount of transactions of investees with related parties reaching NT$100 million or more than 20% of the paid-in capital

January 1 to December 31, 2022

Table 8

Supplier (customer)	Trading counterpart	Affiliation		Status	Status		Distinctive terms and conditions of trade and the reasons	Distinctive terms and conditions of trade and the reasons	Notes/accounts receivable (payable)	Notes/accounts receivable (payable)	Remarks
			Purchase (sale)	Amount	Percentage in total purchase (sale) amount %	Duration	Unit price	Duration	Balance	Percentage in total accounts/notes receivable (payable) %
Suzhou Gold Circuit Electronics Ltd. Suzhou Gold Circuit Electronics Ltd. Suzhou Gold Circuit Electronics Ltd. Changshu Gold Circuit Electronics Ltd. Changshu Gold Circuit Technology Co., Ltd. Changshu Gold Circuit Electronics Ltd. Changshu Gold Circuit Technology Co., Ltd.	Gold Circuit Electronics Ltd. Gold Circuit Electronics Ltd. Changshu Gold Circuit Electronics Ltd. Gold Circuit Electronics Ltd. Gold Circuit Electronics Ltd. Suzhou Gold Circuit Electronics Ltd. Suzhou Gold Circuit Electronics Ltd.	Ultimate parent company Ultimate parent company Affiliated enterprise Ultimate parent company Ultimate parent company Affiliated enterprise Affiliated enterprise	Sales Purchases Sales Sales Sales Sales Sales	( $ 11,493,931 ) 105,564 ( 111,729 ) ( 6,283,149 ) ( 1,687,159 ) ( 672,993 ) ( 166,054 )	( 91 ) 2 ( 1 ) ( 87 ) ( 86 ) ( 9 ) ( 8 )	O/A 3 months O/A 4 months O/A 3 months O/A 4 months O/A 3 months O/A 4 months O/A 4 months	- - - - - - -	－ － － － － － -	$ 4,402,324 ( 73,778 ) 26,611 1,137,871 184,526 334,096 121,662	89 ( 3 ) 1 74 48 22 32

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Gold Circuit Electronics Ltd. and its subsidiaries

Accounts receivable-related party of the investees reaching NT$100 million or more than 20% of the paid-in capital

December 31, 2022

Attachment 9

Unit: NTD thousand

Companies stated into accounts receivable	Trading counterpart	Affiliation	Balance of accounts receivable - related party	Turnover (Note 1)	Overdue accounts receivable - related party	Overdue accounts receivable - related party	Amounts received in subsequent period - related party	Allowance loss
					Amount	Accounting treatment
Suzhou Gold Circuit Electronics Ltd. Changshu Gold Circuit Electronics Ltd. Changshu Gold Circuit Technology Co., Ltd. Changshu Gold Circuit Electronics Ltd. Changshu Gold Circuit Technology Co., Ltd. Changshu Gold Circuit Electronics Ltd. Suzhou Gold Circuit Electronics Ltd.	Gold Circuit Electronics Ltd. Gold Circuit Electronics Ltd. Gold Circuit Electronics Ltd. Suzhou Gold Circuit Electronics Ltd. Suzhou Gold Circuit Electronics Ltd. Changshu Gold Circuit Technology Co., Ltd. Changshu Gold Circuit Technology Co., Ltd.	Ultimate parent company Ultimate parent company Ultimate parent company Affiliated enterprise Affiliated enterprise Affiliated enterprise Affiliated enterprise	Accounts receivable $ 4,402,324 Accounts receivable 1,137,871 Accounts receivable 184,526 Accounts receivable 334,096 Accounts receivable 121,662 Other receivables 1,122,665 Other receivables 805,063	3.13 4.46 6.03 3.36 2.39 - -	$ - - - - - - -	－ － － － － － －	$ 2,033,813 720,024 180,688 153,601 55,241 76,353 337	$ - - - - - - -

Note 1: The cycle days are not calculated for other receivables from related parties.

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Unit: NTD thousand/USD thousand

Gold Circuit Electronics Ltd. and its subsidiaries

Information about investment in Mainland China

January 1 to December 31, 2022

Attachment 10

Name of invested company in China	Principal business	Principal business	Paid-in capital	Mode of investment (Note 1)	Cumulative investment amount outward remitted from Taiwan - beginning of the period	Cumulative investment amount outward remitted from Taiwan - beginning of the period	Investment remittance or regain in the current period	Investment remittance or regain in the current period	Cumulative investment amount outward remitted from Taiwan - end of the period	Net income of investee	Shareholdings of the Company’s direct or indirect investment (%)	Investment gains or losses recognized for the current period (Note 2)	Book value of investment at ending	Investment income repatriated to Taiwan as of the end of the period
							Outward remitted	Repatriated
Suzhou Gold Circuit Electronics Ltd. Changshu Gold Circuit Electronics Ltd. Changshu Gold Circuit Technology Co., Ltd.	Design, produce and sell multi-layer printed circuit boards Design, produce and sell multi-layer printed circuit boards Design, produce and sell multi-layer printed circuit boards		$ 3,239,310 959,724 980,105	2 2 3	$ 3,239,310 959,724 980,105		$ - - -	$ - - -	$ 3,239,310 959,724 980,105	$ 2,596,784 890,011 ( 6,521 )	100 100 100	2.(2) $ 2,533,093 2.(2) 855,608 2.(2) 4,011	$ 5,540,740 3,194,603 ( 719,981 )	$ - - -
Accumulated investments outward remitted from Taiwan at Ending			Investment amount approved by Investment Commission,MOEA				Limit of investment amount required by Investment Commission,MOEA(Note 4）
$ 5,179,139 ( USD 161,010 )			$ 4,944,617 ( USD 161,010 )				$ -

Note 1: The modes of investment are classified into the following four types:

1. To invest in Mainland China companies through remittance from a third area.

2. To invest in Mainland China companies through a company invested and established in a third area.

3. To invest in Mainland China companies through reinvesting in an existing company in a third area.

4. Other ways, ex: discretionary investment contract

Note 2: For the field of investment gain/loss recognized in the current period:

1. Please mark out if there has no investment gain or loss yet because the investment is still under planning.

2. The basis of recognition of investment gain/loss is classified into following three types, which should be marked out.

3. (1) Financial statements reviewed and approved by an international CPA firm in a collaborative relationship with a CPA firm of the ROC.

4. (2) Financial statements audited by the CPAs of the parent company in Taiwan.

5. (3) Others.

Note 3: The related figures herein should be expressed in NTD.

• Note 4: The Company has received the certificate of compliance with business lines of operational headquarters issued by Industrial Development Bureau, MOEA on August 25, 2022. Therefore, the Company may be exempted from the limit of investment amount required by Investment Commission, MOEA.

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Gold Circuit Electronics Ltd. and its subsidiaries

Any significant transactions with investees in Mainland China, either directly or indirectly through a third area

January 1 to December 31, 2022

Attachment 11

Unit: NTD thousand

Related parties’ names	Affiliation of the Company with related party	Type of transaction	Amount		Trading conditions		Notes/accounts receivable (payable)	Notes/accounts receivable (payable)	(Realized) unrealized gain (loss)
				Price	Payment terms	Comparison with the general transactions	Balance	Percentage (%)
Suzhou Gold Circuit Electronics Ltd. 〃 Changshu Gold Circuit Electronics Ltd. 〃 Changshu Gold Circuit Technology Co., Ltd. 〃	Company wholly invested in via a subsidiary indirectly 〃 Company wholly invested in via a subsidiary indirectly 〃 Company wholly invested in via a subsidiary indirectly 〃	Purchases Sales Purchases Sales Purchases Sales	$ 11,493,931 105,564 6,283,149 20,920 1,687,159 5,517	$ 11,493,931 105,564 6,283,149 20,920 1,687,159 5,517	General General General General General General	Similar Similar Similar Similar Similar Similar	( $ 4,402,324 ) 73,778 ( 1,137,871 ) 1,172 ( 184,526 ) 68	89 - 74 - 52 -	( $ 63,691 ) - ( 34,403 ) - 10,532 -

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Gold Circuit Electronics Ltd. and its subsidiaries

Business relationship and major transactions between the parent company and each of its subsidiaries and among the subsidiaries and the amount January 1 to December 31, 2022

Attachment 12

Unit: NTD thousand

No. (Note 1)	Name of trader	Trading counterpart	Relationship with the trader (Note 2)			Transaction
				Title	Amount	Trading conditions	Percentage in total consolidated operating revenue or total assets % (Note 3)
0	Gold Circuit Electronics Ltd.	King Hsiang Investment Co., Ltd. Suzhou Gold Circuit Electronics Ltd. Changshu Gold Circuit Electronics Ltd. Changshu Gold Circuit Technology Co., Ltd.	1 1 1 1	Other revenue Accounts receivable Other receivables Accounts payable Sales revenue Cost of goods sold Interest revenue Other revenue Accounts receivable Accounts payable Other receivables Sales revenue Cost of goods sold Accounts receivable Other receivables Accounts payable Sales revenue Cost of goods sold	$ 24 73,778 24,081 4,402,324 105,564 11,493,931 69 2,619 1,172 1,137,871 10 20,920 6,283,149 68 119 184,526 5,517 1,687,159	Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party	- - - 15 - 35 - - - 4 - - 20 - - 1 - 5

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No. (Note 1)	Name of trader	Trading counterpart	Relationship with the trader (Note 2)			Transaction
				Title	Amount	Trading conditions	Percentage in total consolidated operating revenue or total assets % (Note 3)
1 2 3	Goldex Holding Limited Gold Circuit Enterprise Limited Suzhou Gold Circuit Electronics Ltd.	Suzhou Gold Circuit Electronics Ltd. Changshu Gold Circuit Electronics Ltd. Changshu Gold Circuit Technology Co., Ltd. Gold Circuit Enterprise Limited Gold Circuit International Limited Gold Circuit International Limited Changshu Gold Circuit Technology Co., Ltd. Changshu Gold Circuit Electronics Ltd.	3 3 3 3 3 3 3 3	Interest revenue Interest revenue Interest revenue Interest revenue Interest revenue Interest receivable Other receivables Interest revenue Interest receivable Other receivables Interest revenue Accounts receivable Other receivables Accounts payable Other payables Sales revenue Cost of goods sold Interest receivable Interest revenue Accounts receivable Other receivables Accounts payable	$ 3,094 981 2,112 6,534 1,698 174 92,130 3,719 231 79,846 236 3,716 799,975 121,662 1,049 18,495 166,054 5,088 4,874 26,611 5,711 334,096	Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party	- - - - - - - - - - - - 3 - - - 1 - - - - 1

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No. (Note 1)	Name of trader	Trading counterpart	Relationship with the trader (Note 2)	Transaction	Transaction	Transaction	Transaction
				Title	Amount	Trading conditions	Percentage in total consolidated operating revenue or total assets % (Note 3)
4	Changshu Gold Circuit Electronics Ltd.	Changshu Gold Circuit Technology Co., Ltd.	3	Other payables Sales revenue Cost of goods sold Accounts receivable Other receivables Accounts payable Other payables Interest receivable Sales revenue Cost of goods sold Interest revenue	$ 1,900 111,729 672,993 2,547 1,100,855 42 13,140 21,810 3,275 23,227 29,771	Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party Equivalent to those applicable to a non-related party	- - 2 - 4 - - - - - -

Note 1: The information about transactions between parent company and subsidiaries shall be numbered and noted in the following manner in the box of numbers:

1. 0 is for the Parent Company.

2. Subsidiaries are numbered from number 1.

3. Note 2: The relationship with the trader is classified into three categories as follows:

4. Parent Company to subsidiaries.

5. Subsidiaries to Parent Company.

6. Subsidiaries to subsidiaries.

7. Note 3: For computing the ratio of trade amount to the total consolidated operating revenue or total assets, if it is for asset and liability account, the computation is based on the ratio of ending balance to total consolidated assets; however, if it is for income and expense account, the computation is based on the ratio of interim cumulative amount to total consolidated operating revenue.

8. 93 -

Gold Circuit Electronics Ltd. and its subsidiaries

Information of Major Shareholders

December 31, 2022

Attachment 13

Name of major shareholder	Shares	Shares
	Number of shares held (share)	Shareholding ratio
Chang-Chi Yang First Fiduciary Nomura Investment Account for 2021 of New Labor Pension Fund Jui-Ching Li	96,622,217 33,953,365 27,651,870	19.64% 6.90% 5.62%

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