Stock Code:1608

(English Translation of Parent Company Only Financial Statements and Report Originally Issued in Chinese) HUA ENG WIRE & CABLE CO., LTD.

Parent Company Only Financial Statements

With Independent Auditors’ Report For the Years Ended December 31, 2020 and 2019

Address: No. 170, Chung Cheng 4th Road, Kaohsiung, Taiwan, R.O.C. Telephone: 886-7-281-4161

The independent auditors’ report and the accompanying financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ report and financial statements, the Chinese version shall prevail.

Contents
1. Cover Page
2. Table of Contents
3. Independent Auditors’ Report
4. Balance Sheets
5. Statements of Comprehensive Income
6. Statements of Changes in Equity
7. Statements of Cash Flows
8. Notes to the Financial Statements
(1)
Company history
(2)
Approval date and procedures of the financial statements
(3)
New standards, amendments and interpretations adopted
(4)
Summary of significant accounting policies
(5)
Significant accounting assumptions and judgments, and major sources
of estimation uncertainty
(6)
Explanation of significant accounts
(7)
Related-party transactions
(8)
Pledged assets
(9)
Commitments and contingencies
(10) Losses due to major disasters
(11) Subsequent Events
(12) Other
(13) Other disclosures
(a) Information on significant transactions
(b) Information on investees
(c) Information on investment in Mainland China
(d) Major shareholders
(14) Segment information
9. List of major account items Page

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Contents 1. Cover Page 2. Table of Contents 3. Independent Auditors’ Report 4. Balance Sheets 5. Statements of Comprehensive Income 6. Statements of Changes in Equity 7. Statements of Cash Flows 8. Notes to the Financial Statements (1) Company history (2) Approval date and procedures of the financial statements (3) New standards, amendments and interpretations adopted (4) Summary of significant accounting policies (5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty (6) Explanation of significant accounts (7) Related-party transactions (8) Pledged assets (9) Commitments and contingencies (10) Losses due to major disasters (11) Subsequent Events (12) Other (13) Other disclosures (a) Information on significant transactions (b) Information on investees (c) Information on investment in Mainland China (d) Major shareholders (14) Segment information 9. List of major account items	Page
	1 2 3 4 5 6 7 8 8 8`～`10 10`～`27 27 28`～`61 61`～`63 63 64 64 64 64`～`65 66`～`67 67 67 68 68 69`～`93

Independent Auditors’ Report

To the Board of Directors HUA ENG WIRE & CABLE CO., LTD:

Opinion

We have audited the financial statements of HUA ENG WIRE & CABLE CO., LTD. (“the Company”), which comprise the balance sheets as of December 31, 2020 and 2019, the statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audit in accordance with the Regulations Governing Auditing and Certification of Financial Statements by Certified Public Accountants and the auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Certified Public Accountants Code of Professional Ethics in Republic of China (“the Code”), and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis of our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. The key audit matters we judged shall be presented in the financial report as follows:

Valuation of inventory

Please refer to Note 4(g) for significant accounting policies on inventories and Note 5 for significant accounting assumptions and judgment, and major sources of estimation uncertainty, information regarding the inventory is shown in Note 6(f) of the financial statements.

Description of key audit matter:

The Company's inventories are wire, cable and copper products which are measured at the lower of cost and net realizable value. Since the selling price is affected by copper price which fluctuates wildly in recent years, the valuation of inventory is one of the key areas our audit focused on.

3-1

How the matter was addressed in our audit:

In relation to the key audit matter above, our principal audit procedures include assessing the reasonableness of inventory valuation and obsolescence, and evaluating the assumptions made by the management; corroborating, on a sample basis, by testing the accuracy of inventory aging, examining their net realizable value to the recent sales records and making an analysis on the trend of international copper price fluctuations.

Responsibilities of Management and Those Charged with Governance for the Financial Statements

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

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

Those charged with governance (including the Audit Committee) are responsible for overseeing the Company’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Financial Statements

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

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

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company to cease to continue as a going concern.

3-2

Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of the investment in other entities accounted for using the equity method to express an opinion on the financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

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

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

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

The engagement partners on the audit resulting in this independent auditors’ report are Cheng Lung, Hsu and Po Jen, Yang.

KPMG

Taipei, Taiwan (Republic of China) March 22, 2021

Notes to Readers

The accompanying financial statements are intended only to present the financial position, financial performance and cash flows in accordance with the accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such financial statements are those generally accepted and applied in the Republic of China.

The independent auditors’ audit report and the accompanying financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ report and financial statements, the Chinese version shall prevail.

(English Translation of Financial Statements Originally Issued in Chinese) HUA ENG WIRE & CABLE CO., LTD.

Balance Sheets

December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

December 31, 2020 Amount % $ 303,822 3 950,593 10 68,990 1 9,521 - 729,775 7 10,921 - 3,126 - 1,512,277 16 8,133 - 3,597,158 37 2,133,288 22 58,975 1 603,375 6 2,107,094 22 323,009 3 890,838 9 29,129 - 349 - 8,875 - 6,154,932 63 $ 9,752,090 100	December 31, 2019 Amount % 260,746 3 728,131 8 117,149 1 23,307 - 736,182 8 7,803 - 3,159 - 1,482,469 15 32,358 - 3,391,304 35 2,223,185 23 71,622 1 569,206 6 2,120,866 21 346,081 4 834,386 9 82,745 1 362 - 9,920 - 6,258,373 65 9,649,677 100 Liabilities and Equity Current liabilities: 2100 Short-term borrowings (note 6(m)) 2110 Short-term notes and bills payable (notes 6(m) and (n)) 2130 Current contract liabilities (note 6(v)) 2150 Notes payable (notes 6(r)) 2170 Accounts payable 2180 Accounts payable to related parties (note 7) 2200 Other payables (note 6(r)) 2280 Current lease liabilities (note 6(p)) 2300 Other current liabilities (notes 6(o) and (v)) Total current liabilities Non-Current liabilities: 2570 Deferred tax liabilities (note 6(s)) 2580 Non-current lease liabilities (note 6(p)) 2640 Non-current net defined benefit liability (note 6(r)) 2645 Guarantee deposits received Total non-current liabilities Total liabilities Equity attributable to owners of parent (notes 6(h) and (t)): 3110 Ordinary share 3200 Capital surplus 3300 Retained earnings: 3310 Legal reserve 3320 Special reserve 3350 Unappropriated retained earnings 3400 Other equity 3500 Treasury shares Total equity Total liabilities and equity	December 31,	2020	December 31, 2019 Amount % 656,643 7 899,713 9 28,975 - 5,119 - 245,951 3 51,521 1 107,880 1 15,796 - 6,233 - 2,017,831 21 521,392 5 247,052 3 18,224 - 3,606 - 790,274 8 2,808,105 29 6,327,735 65 3,463 - - - 873,871 9 649,975 7 1,523,846 16 (44,801) - (968,671) (10) 6,841,572 71 9,649,677 100
Amount $ 303,822 950,593 68,990 9,521 729,775 10,921 3,126 1,512,277 8,133 3,597,158 2,133,288 58,975 603,375 2,107,094 323,009 890,838 29,129 349 8,875 6,154,932 $ 9,752,090	Amount 260,746 728,131 117,149 23,307 736,182 7,803 3,159 1,482,469 32,358 3,391,304 2,223,185 71,622 569,206 2,120,866 346,081 834,386 82,745 362 9,920 6,258,373 9,649,677	Amount	%	Amount 656,643 899,713 28,975 5,119 245,951 51,521 107,880 15,796 6,233 2,017,831 521,392 247,052 18,224 3,606 790,274 2,808,105 6,327,735 3,463 - 873,871 649,975 1,523,846 (44,801) (968,671) 6,841,572 9,649,677
			9 9 - - 3 - 1 - -
			22
			5 2 - -
			7
			29
			65
			1
			1 11 3
			15
			-

See accompanying notes to financial statements.

(English Translation of Financial Statements Originally Issued in Chinese) HUA ENG WIRE & CABLE CO., LTD.

Statements of Comprehensive Income

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars, Except for Earnings Per Common Share)

4100
Operating revenues (notes 6(v) and 7)
5000
Operating costs (notes 6(f), (r), (w), 7 and 12)
5900
Gross profit
6000
Operating expenses (notes 6(r), (w), 7 and 12)
6900
Net operating income
7000
Non-operating income and expenses:(notes 6(g), (i), (o), (p), (q), (x), and 7)
7100
Interest income
7010
Other income
7020
Other gains and losses, net
7050
Finance costs
7060
Share of profit (loss) of associates and joint ventures accounted for using equity method, net
7900
Profit before income tax
7950
Less: Income tax expenses (benefit) (note 6(s))
8200
Profit
8300
Other comprehensive income (loss):
8310
Items that may not be reclassified subsequently to profit or loss:
8311
Remeasurements of defined benefit plans
8316
Unrealized gains (losses) from investments in equity instruments measured at fair value through
other comprehensive income (note 6(y))
8330
Share of other comprehensive income of subsidiaries, associates and joint ventures accounted for
using equity method, components of other comprehensive income that will not be reclassified
8349
Income tax related to components of other comprehensive income that will not be reclassified to
profit or loss (note 6(s))
8300
Other comprehensive income (after tax)
8500
Comprehensive income
Earnings per share (note 6(u)):
9750
Basic earnings per share (in New Taiwan Dollars)
9850
Diluted earnings per share (in New Taiwan Dollars)

2020

See accompanying notes to financial statements.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese) HUA ENG WIRE & CABLE CO., LTD.

Statements of Changes in Equity

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

Ordinary shares	Capital surplus		Retained earnings		Other equity	Other equity	Treasury shares	Total equity
					Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income
		Legal reserve	Special reserve	Unappropriated retained earnings (deficit yet to compensated)
$ 6,327,735 - - - - - - 6,327,735 - - - - - - - $ 6,327,735	254,959	93,079	873,871	(483,968) 792,653 (6,748) 785,905 93,079 254,959 - 649,975 323,664 (5,181) 318,483 (64,997) (165,826) (417,631) - 320,004		(27,279) - (17,522) (17,522) - - - (44,801) - 4,019 4,019 - - - - (40,782)	(912,919) - - - - - (55,752) (968,671) - - - - - - - (968,671)	6,125,478 792,653 (24,270) 768,383 - - (52,289) 6,841,572 323,664 (1,162) 322,502 - - (417,631) 54,290 6,800,733
	- -	- -	- -
	-	-	-
			- - -
			873,871
			- -
			-
			- 165,826 - -
			1,039,697

See accompanying notes to financial statements.

(English Translation of Financial Statements Originally Issued in Chinese) HUA ENG WIRE & CABLE CO., LTD.

Statements of Cash Flows

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from operating activities: Profit before tax Adjustments: Adjustments to reconcile profit (loss): Depreciation expense Net gain on financial assets at fair value through profit or loss Interest expense Interest income Dividend income Share of loss of subsidiaries, associates and joint ventures accounted for using equity method Loss (gain) on disposal of property, plant and equipment Provision reversal Total adjustments to reconcile profit (loss) Changes in operating assets and liabilities: Net changes in operating assets: Decrease (increase) in contract assets Decrease in notes receivable Decrease in accounts receivable Increase in accounts receivable from related parties Decrease (increase) in other receivables Increase in inventories Decrease (increase) in other current assets Increase in other non-current assets Total net changes in operating assets Net changes in operating liabilities: Decrease in contract liabilities Increase (decrease) in notes payable Increase (decrease) in accounts payable Increase (decrease) in accounts payable to related parties Increase in other payables Increase (decrease) in other current liabilities Decrease in net defined benefit liabilities Total net changes in operating liabilities Total net changes in operating assets and liabilities Total adjustments Cash inflow (outflow) generated from operations Interest received Dividends received Interest paid Income taxes paid Net cash flows from operating activities Cash flows used in investing activities: Acquisition of financial assets at fair value through profit or loss Proceeds from capital reduction from liquidation of subsidiaries Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Decrease (increase) in refundable deposits Acquisition of investment property Proceeds from capital reduction of financial assets at fair value through other comprehensive income Net cash flows used in investing activities Cash flows used in financing activities: Increase in short-term loans borrowings Decrease in short-term notes and bills payable Increase in guarantee deposits received Payment of lease liabilities Cash dividends paid Acquisition of ownership interests of subsidiaries Net cash flows used in financing activities Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	2020 $ 377,305 102,012 (39,972) 14,673 (42) (90,862) 24,046 (618) (1,221) 8,016 48,159 13,786 6,407 (3,118) 819 (29,808) 24,225 - 60,470 (17,727) 81 3,574 (34,202) 6,969 (1,004) (7,412) (49,721) 10,749 18,765 396,070 42 90,862 (8,418) - 478,556 (92,593) - (59,450) 813 (773) (61,519) 15,541 (197,981) 193,407 (6,185) 1,630 (15,796) (410,555) - (237,499) 43,076 260,746 $ 303,822	2019 724,205 99,601 (608,745) 13,661 (74) (76,122) 38,969 706 (4,110) (536,114) (25,802) 1,924 84,460 (3,136) (1,349) (139,698) (9,493) (777) (93,871) (41,898) (7,291) (43,927) 13,905 16,690 2,052 (70,475) (130,944) (224,815) (760,929) (36,724) 74 76,170 (6,817) (18,281) 14,422 (59,875) 132 (85,362) 236 68,580 (150) - (76,439) 58,630 (6,864) 811 (15,568) - (87,248) (50,239) (112,256) 373,002 260,746

See accompanying notes to financial statements.

(English Translation of Financial Statements Originally Issued in Chinese) HUA ENG WIRE & CABLE CO., LTD.

Notes to the Financial Statements

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars, unless otherwise specified)

(1) Company history:

Hua Eng Wire & Cable Co., Ltd. ("the Company") was incorporated on December 8, 1956, as a company limited by shares and registered under the Ministry of Economic Affairs, R.O.C. The address of the Company's registered office is No. 170, Chung Cheng 4th Road, Kaohsiung, Taiwan R.O.C. The Company is engaged in the processing, manufacture, sale and construction of wire, cable and copper products.

(2) Approval date and procedures of the financial statements:

The financial statements were authorized for issue by the Board of Directors on March 22, 2021.

(3) New standards, amendments and interpretations adopted:

(a) The impact of the International Financial Reporting Standards (“IFRSs”) endorsed by the Financial Supervisory Commission, R.O.C. (“FSC”) which have already been adopted.

The Company has initially adopted the following new amendments, which do not have a significant impact on its financial statements, from January 1, 2020:

●Amendments to IFRS 3 “Definition of a Business”
●Amendments to IFRS 9, IAS39 and IFRS7 “Interest Rate Benchmark Reform”
●Amendments to IAS 1 and IAS 8 “Definition of Material”
●Amendments to IFRS 16 “COVID-19-Related Rent Concessions”
(b) The impact of IFRS issued by the FSC but not yet effective

The Company assesses that the adoption of the following new amendments, effective for annual period beginning on January 1, 2021, would not have a significant impact on its financial statements:

●Amendments to IFRS 4 “Extension of the Temporary Exemption from Applying IFRS 9”
－
●Amendments to IFRS 9, IAS39, IFRS7, IFRS 4 and IFRS 16 “Interest Rate Benchmark Reform Phase 2”
(c) The impact of IFRS issued by IASB but not yet endorsed by the FSC

The following new and amended standards, which may be relevant to the Company, have been issued by the International Accounting Standards Board (IASB), but have not yet to be endorsed by the FSC:

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

Standards or
Interpretations
Amendments to IAS 1
“Classification of Liabilities as
Current or Non-current”
Amendments to IAS 16
“Property, Plant and
Equipment－Proceeds before
Intended Use”
Amendments to IAS 37
“Onerous Contracts－Cost of
Fulfilling a Contract”
Amendments to IAS 1
“Disclosure of Accounting
Policies” Content of amendment
Effective date per
IASB
The amendments aim to promote consistency
in applying the requirements by helping
companies
determine
whether,
in
the
statement of balance sheet, debt and other
liabilities with an uncertain settlement date
should be classified as current (due or
potentially due to be settled within one year)
or non-current.
The amendments include clarifying the
classification
requirements
for
debt
a
company might settle by converting it into
equity.
January 1, 2023
The amendments prohibit a company from
deducting from the cost of property, plant
and equipment amounts received from
selling items produced while the company is
preparing the asset for its intended use.
Instead, a company will recognize such sales
proceeds and related cost in profit or loss.
January 1, 2022
The amendments clarify that the ‘ costs of
fulfilling a contract’ comprises the costs that
relate directly to the contract as follows:
●the incremental costs – e.g. direct labor
and materials; and
●an allocation of other direct costs – e.g. an
allocation of the depreciation charge for
an item of property, plant and equipment
used in fulfilling the contract.
January 1, 2022
The key amendments to IAS 1 include:
●requiring companies to disclose their
material accounting policies rather than
their significant accounting policies;
●clarifying that accounting policies related
to immaterial transactions, other events or
conditions are themselves immaterial and
as such need not be disclosed; and
●clarifying that not all accounting policies
that relate to material transactions, other
events or conditions are themselves
material to a company’ s financial
statements.
January 1, 2023

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

Standards or
Interpretations
Amendments to IAS 8
“Definition of Accounting
Estimates”

Content of amendment
Effective date per
IASB
The amendments introduce a new definition
for accounting estimates: clarifying that they
are monetary amounts in the financial
statements that are subject to measurement
uncertainty.
The amendments also clarify the relationship
between accounting policies and accounting
estimates by specifying that a company
develops an accounting estimate to achieve
the objective set out by an accounting policy.
January 1, 2023

The Company is evaluating the impact of its initial adoption of the abovementioned standards or interpretations on its financial position and financial performance. The results thereof will be disclosed when the Company completes its evaluation.

The Company does not expect the following other new and amended standards, which have not yet to be endorsed by the FSC, to have a significant impact on its financial statements:

●Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets Between an Investor and Its Associate or Joint Venture”
●IFRS 17 “ Insurance Contracts” and amendments to IFRS 17 “ Insurance Contracts”
●Annual Improvements to IFRS Standards 2018-2020
●Amendments to IFRS 3 “Reference to the Conceptual Framework”

(4) Summary of significant accounting policies:

The significant accounting policies presented in the financial statements are summarized as follows. Except for those specifically indicated, the following accounting policies were applied consistently throughout the presented periods in the financial statements.

(a) Statement of compliance

These financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers (hereinafter referred to as “the Regulations”).

(b) Basis of preparation
(i) Basis of measurement

Except for the following significant accounts, the financial statements have been prepared on the historical cost basis:

1) Financial assets at fair value through profit or loss are measured at fair value;
2) Financial assets at fair value through other comprehensive income are measured at fair value;

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

3) The defined benefit liabilities are recognized as the present value of the defined benefit obligation less the fair value of pension fund assets and the re-measurement of the effect of the asset ceiling as stated in note 4(p).

(ii) Functional and presentation currency

The functional currency of entity is determined based on the primary economic environment in which the entity operates.

The financial statements are presented in New Taiwan dollars, which is the Company's functional currency. All financial information presented in New Taiwan Dollars has been rounded to the nearest thousand.

Transactions in foreign currencies are translated into the respective functional currencies of the Company at exchange rates at the dates of the transactions. At the end of each subsequent reporting period, monetary items denominated in foreign currencies are translated into the functional currencies using the exchange rate at that date. Non-monetary items denominated in foreign currencies that are measured at fair value are translated into the functional currencies using the exchange rate at the date that the fair value was determined. Non-monetary items denominated in foreign currencies that are measured based on historical cost are translated using the exchange rate at the date of translation.

Exchange differences are generally recognized in profit or loss, except for those differences relating to the following, which are recognized in other comprehensive income:

(i) an investment in equity securities designated as at fair value through other comprehensive income;
(ii) a financial liability designated as a hedge of the net investment in a foreign operation to the extent that the hedge is effective; or
(iii) qualifying cash flow hedges to the extent that the hedges are effective.
(d) Classification of current and non-current assets and liabilities

An asset is classified as current under one of the following criteria, and all other assets are classified as non-current.

(i) It is expected to be realized, or intended to be sold or consumed, in the normal operating cycle;
(ii) It is held primarily for the purpose of trading;
(iii) It is expected to be realized within twelve months after the reporting period; or
(iv) The asset is cash and cash equivalent, unless, the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

A liability is classified as current under one of the following criteria, and all other liabilities are classified as non-current.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(i) It is expected to be settled in its normal operating cycle;
(ii) It is held primarily for the purpose of trading;
(iii) It is due to be settled within twelve months after the reporting period; or
(iv) It does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

(e) Cash and cash equivalents

Cash comprises cash on hand and demand deposits. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Time deposits which meet the above definition and are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes should be recognized as cash equivalents.

(f) Financial instruments

Trade receivables and debt securities issued are initially recognized when they are originated. All other financial assets and financial liabilities are initially recognized when the Company becomes a party to the contractual provisions of the instrument. A financial asset (unless it is a trade receivable without a significant financing component) or financial liability is initially measured at fair value plus, for an item not at fair value through profit or loss (FVTPL), transaction costs that are directly attributable to its acquisition or issue. A trade receivable without a significant financing component is initially measured at the transaction price.

(i) Financial assets

All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis.

On initial recognition, a financial asset is classified as measured at: amortized cost; Fair value through other comprehensive income (FVOCI) – debt investment; FVOCI – equity investment; or FVTPL. Financial assets are not reclassified subsequent to their initial recognition unless the Company changes its business model for managing financial assets, in which case all affected financial assets are reclassified on the first day of the first reporting period following the change in the business model.

1) Financial assets measured at amortized cost

A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as at FVTPL ：

‧ it is held within a business model whose objective is to hold assets to collect contractual cash flows; and
‧ its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

These assets are subsequently measured at amortized cost, which is the amount at which the financial asset is measured at initial recognition, plus/minus, the cumulative amortization using the effective interest method, adjusted for any loss allowance. Interest income, foreign exchange gains and losses, as well as impairment, are recognized in profit or loss. Any gain or loss on derecognition is recognized in profit or loss.

2) Fair value through other comprehensive income (FVOCI)

A debt investment is measured at FVOCI if it meets both of the following conditions and is not designated as at FVTPL ：

‧ it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and
‧ its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

On initial recognition of an equity investment that is not held for trading, the Company may irrevocably elect to present subsequent changes in the investment’ s fair value in other comprehensive income. This election is made on an instrument-by-instrument basis.

Equity investments at FVOCI are subsequently measured at fair value. Dividends are recognized as income in profit or loss unless the dividend clearly represents a recovery of part of the cost of the investment. Other net gains and losses are recognized in other comprehensive income and are never reclassified to profit or loss.

Dividend income is recognized in profit or loss on the date on which the Company’s right to receive payment is established.

3)
Fair value through profit or loss (FVTPL)

All financial assets not classified as amortized cost or FVOCI described as above are measured at FVTPL, including derivative financial assets. On initial recognition, the Company may irrevocably designate a financial asset, which meets the requirements to be measured at amortized cost or at FVOCI, as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.

These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognized in profit or loss.

4)
Business model assessment

The Company makes an assessment of the objective of the business model in which a financial asset is held at portfolio level because this best reflects the way the business is managed and information is provided to management. The information considered includes ：

‧ the stated policies and objectives for the portfolio and the operation of those policies in practice. These include whether the management’ s strategy focuses on earning contractual interest income, maintaining a particular interest rate profile, matching

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

the duration of the financial assets to the duration of any related liabilities, or expected cash outflows, or realizing cash flows through the sale of the assets;

‧ how the performance of the portfolio is evaluated and reported to the Company’s management;
‧ the risks that affect the performance of the business model (and the financial assets held within that business model) and how those risks are managed;
‧ how managers of the business are compensated ─ e.g. whether compensation is based on the fair value of the assets managed or the contractual cash flows collected; and
‧ the frequency, volume and timing of sales of financial assets in prior periods, the reasons for such sales and expectations about future sales activity.

Transfers of financial assets to third parties in transactions that do not qualify for derecognition are not considered sales for this purpose, and are consistent with the Company’s continuing recognition of the assets.

Financial assets that are held for trading or are managed and whose performance is evaluated on a fair value basis are measured at FVTPL.

5) Assessment whether contractual cash flows are solely payments of principal and interest

For the purposes of this assessment, ‘ principal’ is defined as the fair value of the financial assets on initial recognition. ‘Interest’ is defined as consideration for the time value of money and for the credit risk associated with the principal amount outstanding during a particular period of time and for other basic lending risks and costs, as well as a profit margin.

In assessing whether the contractual cash flows are solely payments of principal and interest, the Company considers the contractual terms of the instrument. This includes assessing whether the financial asset contains a contractual term that could change the timing or amount of contractual cash flows, such that it would not meet this condition. In making this assessment, the Company considers ：

‧ contingent events that would change the amount or timing of cash flows ；
‧ terms that may adjust the contractual coupon rate, including variable rate features ；
‧ prepayment and extension features ； and
‧ terms that limit the Company’s claim to cash flows from specified assets (e.g. nonrecourse features).
6) Impairment of financial assets

The Company recognizes loss allowances for expected credit losses (ECL) on financial assets measured at amortized cost (including cash and cash equivalents, notes and accounts receivable, other receivables and guarantee deposit paid), debt investments measured at FVOCI and contract assets.

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

The Company measures loss allowances at an amount equal to lifetime ECL, except for the following which are measured as 12-month ECL ：

‧ debt securities that are determined to have low credit risk at the reporting date ； and
‧ other debt securities and bank deposit for which credit risk (i.e. the risk of default occurring over the expected life of the financial instrument) has not increased significantly since initial recognition.

Loss allowance for accounts receivable and contract assets are always measured at an amount equal to lifetime ECL.

The Company considers its financial instrument to have low credit risk when it is in low default risk, and the debtor has strong ability to perform contractual obligations to the current cash flow if adverse change in economic and business conditions may (not necessarily) reduce the debtor's ability to perform its obligations to the cash flow over a longer period of time.

When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECL, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis based on the Company’ s historical experience and informed credit assessment as well as forwardlooking information.

The Company assumes that the credit risk on a financial asset has increased significantly if it is more than 30 days past due.

The Company considers a financial asset to be in default when the financial asset is more than 180 days past due or the debtor is unlikely to pay its credit obligations to the Company in full.

Lifetime ECL are the ECL that result from all possible default events over the expected life of a financial instrument.

12-month ECL are the portion of ECL that result from default events that are possible within the 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months).

The maximum period considered when estimating ECL is the maximum contractual period over which the Company is exposed to credit risk.

ECL are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the Company in accordance with the contract and the cash flows that the Company expects to receive). ECL are discounted at the effective interest rate of the financial asset.

At each reporting date, the Company assesses whether financial assets carried at amortized cost and debt instrument at FVOCI are credit-impaired. A financial asset is ‘ credit-impaired’ when one or more events that have a detrimental impact on the

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

estimated future cash flows of the financial asset have occurred. Evidence that a financial asset is credit-impaired includes the following observable data:

‧ significant financial difficulty of the borrower or issuer ；
‧ a breach of contract such as a default or being more than 180 days past due ；
‧ the lender of the borrower, for economic or contractual reasons relating to the borrower's financial difficulty, having granted to the borrower a concession that the lender would not otherwise consider ；
‧ it is probable that the borrower will enter bankruptcy or other financial reorganization ； or
‧ the disappearance of an active market for a security because of financial difficulties.

Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets. For debt securities at FVOCI, the loss allowance is charged to profit or loss and is recognized in other comprehensive income instead of reducing the carrying amount of the asset.

The gross carrying amount of a financial asset is written off when the Company has no reasonable expectations of recovering a financial asset in its entirety or a portion thereof. For corporate customers, the Company individually makes an assessment with respect to the timing and amount of write-off based on whether there is a reasonable expectation of recovery. The Company expects no significant recovery from the amount written off. However, financial assets that are written off could still be subject to enforcement activities in order to comply with the Company’s procedures for recovery of amounts due.

7) Derecognition of financial assets

The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Company neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.

The Company enters into transactions whereby it transfers assets recognized in its statement of balance sheets, but retains either all or substantially all of the risks and rewards of the transferred assets. In these cases, the transferred assets are not derecognized.

(ii) Financial liabilities and equity instruments
1) Classification of debt or equity

Debt and equity instruments issued by the Company are classified as financial liabilities or equity in accordance with the substance of the contractual agreements and the definitions of a financial liability and an equity instrument.

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

2) Equity instrument

An equity instrument is any contract that evidences residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued are recognized as the amount of consideration received, less the direct cost of issuing.

3) Financial liabilities

Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss.

Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in profit or loss.

4) Derecognition of financial liabilities

The Company derecognizes a financial liability when its contractual obligations are discharged or cancelled, or expire. The Company also derecognizes a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value.

On derecognition of a financial liability, the difference between the carrying amount of a financial liability extinguished and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognized in profit or loss.

5) Offsetting of financial assets and liabilities

Financial assets and financial liabilities are offset and the net amount presented in the statement of balance sheet when, and only when, the Company currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously.

(g) Inventories

Inventories are measured at the lower of cost and net realizable value. The cost of inventories is based on weighted average costing principle and includes expenditure incurred in acquiring the inventories, production or conversion costs, and other costs incurred in bringing them to their present location and condition. In the case of manufactured inventories and work in progress, cost includes an appropriate share of production overheads based on normal operating capacity.

Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses.

(h) Investment in associates

Associates are those entities in which the Company has significant influence, but not control or joint control, over their financial and operating policies. Investments in associates are accounted for using

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

the equity method and are recognized initially at cost. The cost of the investment includes transaction costs. The carrying amount of the investment in associates includes goodwill arising from the acquisition less any accumulated impairment losses.

The financial statements include the Company’s share of the profit or loss and other comprehensive income of those associates, after adjustments to align their accounting policies with those of the Company from the date on which significant influence commences until the date on which significant influence ceases. The Company recognizes any changes of its proportionate share in the investee within capital surplus, when an associate's equity changes due to reasons other than profit and loss or comprehensive income, which did not result in changes in actual significant in influence.

Unrealized gains and losses resulting from transactions between the Company and an associate are recognized only to the extent of unrelated Company's interests in the associate.

When the Company’s share of losses of an associate equals or exceeds its interest in associates, it discontinues recognizing its share of further losses. After the recognized interest is reduced to zero, additional losses are provided for, and a liability is recognized, only to the extent that the Company has incurred legal or constructive obligations or made payments on behalf of the associate.

(i)

Investment in subsidiaries

When preparing the parent company only financial statements, the investments in subsidiaries, which are controlled by the Company, are accounted for using the equity method. Under the equity method, the profit or loss for the period and other comprehensive income presented in the parent company only financial statements should be the same as the allocations of profit or loss for the period and of other comprehensive income attributable to the owners of the parent presented in the financial statements prepared on a consolidated basis; and the owners’ equity presented in the parent company only financial statements should be the same as the equity attributable to the owners of the parent presented in the financial statements prepared on a consolidated basis.

Changes in a parent’s ownership interest in a subsidiary that do not result in the loss of control are accounted for within equity.

When subsidiaries hold the Company's stocks, the Company recognized investment gains or loss and prepared financial statements, it should treat the Company's stocks as treasury stocks.

(j) Investment property

Investment property is the property held either to earn rental income or for capital appreciation or for both, but not for sale in the ordinary course of business, for use in the production or supply of goods or services, or for administrative purposes. Investment property is measured at cost on initial recognition and subsequently at cost, less accumulated depreciation and accumulated impairment losses. Depreciation expense is calculated based on the depreciation method, useful life, and residual value which are the same as those adopted for property, plant and equipment.

Any gain or loss on disposal of an investment property (calculated as the difference between the net proceeds from disposal and the carrying amount) is recognized in profit or loss.

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

Rental income from investment property is recognized as other revenue on a straight-line basis over the term of the lease. Lease incentives granted are recognized as an integral part of the total rental income, over the term of the lease.

(k) Property, plant and equipment

(i) Recognition and measurement

Items of property, plant and equipment are measured at cost, which includes capitalized borrowing costs, less accumulated depreciation and any accumulated impairment losses.

If significant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

Any gain or loss on disposal of an item of property, plant and equipment is recognized in profit or loss.

(ii) Subsequent expenditure

Subsequent expenditure is capitalized only if it is probable that the future economic benefits associated with the expenditure will flow to the Company.

(iii) Depreciation

Depreciation is calculated on the cost of an asset less its residual value and is recognized in profit or loss on a straight-line basis over the estimated useful lives of each component of an item of property, plant and equipment.

Land is not depreciated.

The estimated useful lives for the current and comparative years are as follows:

1)	Buildings	1`～`55 years
2)	Machinery and equipment	1`～`20 years
3)	Other equipment	1`～`20 years

Depreciation methods, useful lives and residual values are reviewed at each annual reporting date and adjusted if appropriate.

(iv) Reclassification to investment property

A property is reclassified to investment property at its carrying amount when the use of the property changes from owner-occupied to investment property.

(l) Lease

(i) Identifying a lease

At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company assesses whether:

－ the contract involves the use of an identified asset – this may be specified explicitly or implicitly, and should be physically distinct or represent substantially all of the capacity of a physically distinct asset. If the supplier has a substantive substitution right, then the asset is not identified; and
－ the customer has the right to obtain substantially all of the economic benefits from use of the asset throughout the period of use; and
－ the customer has the right to direct the use of the asset throughout the period of use only if either:
(1)the customer has the right to direct how and for what purpose the asset is used throughout the period of use; or
(2)the relevant decisions about how and for what purpose the asset is used are predetermined and:
the customer has the right to operate the asset throughout the period of use, without the supplier having the right to change those operating instructions; or
the customer designed the asset in a way that predetermines how and for what purpose it will be used throughout the period of use.

On the date of lease establishment or reassessment of whether the contract includes a lease, the Company allocates the consideration in the contract to each lease components on the basis of their relative stand-alone price.

(ii) As a lessee

The Company recognizes a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received.

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be reliably determined, the Company’s incremental borrowing rate. Generally, the Company uses its incremental borrowing rate as the discount rate.

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

Lease payments included in the measurement of the lease liability comprise the following:

－ fixed payments, including in-substance fixed payments;
－ variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;
－ amounts expected to be payable under a residual value guarantee; and
－ payments for purchase or termination options that are reasonably certain to be exercised.

The lease liability is measured at amortized cost using the effective interest method. It is remeasured when:

－ there is a change in future lease payments arising from the change in an index or rate; or
－ there is a change in the Company’s estimate of the amount expected to be payable under a residual value guarantee; or
－ there is a change in the lease term resulting from a change of its assessment on whether it will exercise an option to purchase the underlying asset, or
－ there is a change of its assessment on whether it will exercise an extension or termination option; or
－ there is any lease modification

When the lease liability is remeasured, other than lease modifications, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or in profit and loss if the carrying amount of the right-of-use asset has been reduced to zero.

When the lease liability is remeasured to reflect the partial or full termination of the lease for lease modifications that decrease the scope of the lease, the Company accounts for the remeasurement of the lease liability by decreasing the carrying amount of the right-of-use asset to reflect the partial or full termination of the lease, and recognize in profit or loss any gain or loss relating to the partial or full termination of the lease.

The Company presents right-of-use assets that do not meet the definition of investment and lease liabilities as a separate line item respectively in the statement of balance sheets.

The Company has elected not recognize right-of-use assets and lease liabilities for short-term leases of office spaces and equipments that have a lease term of 12 months or less. The Company recognizes the lease payments associated with these leases as an expense on a straight-line basis over the lease term.

(iii) As a lessor

When the Company acts as a lessor, it determines at lease commencement whether each lease is a finance lease or an operating lease. To classify each lease, the Company makes an overall assessment of whether the lease transfers to the lessee substantially all of the risks and rewards of ownership incidental to ownership of the underlying asset. If this is the case, then the lease is a finance lease; if not, then the lease is an operating lease. As part of this assessment, the

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

Company considers certain indicators such as whether the lease is for the major part of the economic life of the asset.

The Company recognizes lease payments received under operating leases as income on a straight-line basis over the lease term as part of ‘rental income’.

(m) Impairment of non-financial assets

At each reporting date, the Company reviews the carrying amounts of its non-financial assets (other than inventories, contract assets, and deferred tax assets) to determine whether there is any indication of impairment. If any such indication exists, then the asset’ s recoverable amount is estimated.

For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or cash-generating units (CGUs).

The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU.

An impairment loss is recognized if the carrying amount of an asset or CGU exceeds its recoverable amount.

Impairment losses are recognized in profit or loss. They are allocated first to reduce the carrying amount of any goodwill allocated to the CGU, and then to reduce the carrying amounts of the other assets in the CGU on a pro rata basis.

An impairment loss in respect of goodwill is not reversed. For other assets, an impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

(n) Provisions

A provision is recognized if, as a result of a past event, the Company has a present obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects the current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognized as finance cost.

Provision for onerous contracts

The provision for onerous contracts is recognized when the expected benefits to be derived by the Company from a contract are lower than the unavoidable cost of meeting its obligations under the contract. The provision is measured at the present value of the lower of the expected cost of terminating the contract or the expects net cost of continuing with the contract. Before a provision is established, the Company recognizes any impairment loss on the assets associated with that contract.

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(o) Revenue

(i) Revenue from contracts with customers

Revenue is measured based on the consideration to which the Company expects to be entitled in exchange for transferring goods or services to a customer. The Company recognizes revenue when it satisfies a performance obligation by transferring control of a good or a service to a customer. The accounting policies for the Company’ s main types of revenue are explained below.

1) Sale of goods

The Company recognizes revenue when control of the products has been transferred, being when the products are delivered to the customer, the customer has full discretion over the channel and price to sell the products, and there is no unfulfilled obligation that could affect the customer’ s acceptance of the products. Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the products in accordance with the sales contract, the acceptance provisions have lapsed, or the Company has objective evidence that all criteria for acceptance have been satisfied.

A receivable is recognized when the goods are delivered as this is the point in time that the Company has a right to an amount of consideration that is unconditional.

2) Construction contracts

The Company enters into contracts to constructions. Because its customer controls the asset as it is constructed, the Company recognizes revenue over time on the basis of the construction costs incurred to date as a proportion of the total estimated costs of the contract. The consideration promised in the contract includes fixed and variable amounts. The customer pays the fixed amount based on a payment schedule, for some variable considerations, accumulated experience is used to estimate the amount of variable consideration, using the expected value method; for other variable considerations, the Company estimates the amount of variable consideration using the most likely amount. The Company recognizes revenue only to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur. If the Company has recognized revenue, but not issued a bill, then the entitlement to consideration is recognized as a contract asset. The contract asset is transferred to receivables when the entitlement to payment becomes unconditional.

If the Company cannot reasonably measure its progress towards complete satisfaction of the performance obligation of a construction contract, the Company shall recognize revenue only to the extent of the costs expected to be recovered.

A provision for onerous contracts is recognized when the Company expects the unavoidable costs of performing the obligations under a construction contract exceed the economic benefits expected to be received under the contract.

Estimates of revenues, costs or extent of progress toward completion are revised if circumstances change. Any resulting increases or decreases in estimated revenues or costs are reflected in profit or loss in the period in which the circumstances that give rise to the revision become known by management.

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

3) Financing components

The Company does not expect to have any contracts where the period between the transfer of the promised goods or services to the customer and the payment by the customer exceeds one year. As a consequence, the Company does not adjust any of the transaction prices for the time value of money.

(ii) Contract costs

1) Incremental costs of obtaining a contract

The Company recognizes as an asset the incremental costs of obtaining a contract with a customer if the Company expects to recover those costs. The incremental costs of obtaining a contract are those costs that the Company incurs to obtain a contract with a customer that it would not have incurred if the contract had not been obtained. Costs to obtain a contract that would have been incurred regardless of whether the contract was obtained shall be recognized as an expense when incurred, unless those costs are explicitly chargeable to the customer regardless of whether the contract is obtained.

The Company applies the practical expedient to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that the entity otherwise would have recognized is one year or less.

2) Costs to fulfil a contract

If the costs incurred in fulfilling a contract with a customer are not within the scope of another Standard (for example, IAS 2 Inventories, IAS 16 Property, Plant and Equipment or IAS 38 Intangible Assets), the Company recognizes an asset from the costs incurred to fulfil a contract only if those costs meet all of the following criteria:

‧ the costs relate directly to a contract or to an anticipated contract that the Company can specifically identify;
‧ the costs generate or enhance resources of the Company that will be used in satisfying (or in continuing to satisfy) performance obligations in the future; and
‧ the costs are expected to be recovered.

General and administrative costs, costs of wasted materials, labor or other resources to fulfil the contract that were not reflected in the price of the contract, costs that relate to satisfied performance obligations (or partially satisfied performance obligations), and costs for which the Company cannot distinguish whether the costs relate to unsatisfied performance obligations or to satisfied performance obligations(or partially satisfied performance obligations), the Company recognizes these costs as expenses when incurred.

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(p) Employee benefits

(i) Defined contribution plans

Obligations for contributions to defined contribution plans are expensed as the related service is provided.

(ii) Defined benefit plans

The Company’s net obligation in respect of defined benefit plans is calculated separately for each the plan by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets.

The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method. When the calculation results in a potential asset for the Company, the recognized asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.

Remeasurements of the net defined benefit liability, which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognized immediately in other comprehensive income, and accumulated in retained earnings within equity. The Company determines the net interest expense (income) on the net defined benefit liability (asset) for the period by applying the discount rate used to measure the defined benefit obligation at the beginning of the annual period to the then-net defined benefit liability (asset). Net interest expense and other expenses related to defined benefit plans are recognized in profit or loss.

When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognized immediately in profit or loss. The Company recognizes gains and losses on the settlement of a defined benefit plan when the settlement occurs.

(iii) Short-term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognized for the amount expected to be paid if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

(q) Income taxes

Income tax comprise current taxes and deferred taxes. Except for expenses related to business combinations or recognized directly in equity or other comprehensive income, all current and deferred taxes shall be recognized in profit or loss.

Current taxes comprise the expend tax payables or receivables on the taxable profits (losses) for the year and any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax payables or receivables are the best estimate of the tax amount expected to be paid or

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

received that reflects uncertainty related to income taxes, if any. It is measured using tax rates enacted or substantively enacted at the reporting date.

Deferred taxes arise due to temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their respective tax bases. Deferred taxes are recognized except for the following:

(i) Temporary differences on the initial recognition of assets and liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profits (losses) at the time of the transaction;
(ii) Temporary differences related to investments in subsidiaries, associates and joint arrangements to the extent that the Company is able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future; and
(iii) Taxable temporary differences arising on the initial recognition of goodwill.

Deferred taxes are measured at the tax rates that are expected to be applied to temporary differences when they reserve, using tax rates enacted or substantively enacted at the reporting date.

Deferred tax assets and liabilities are offset if the following criteria are met:

(i) The Company has a legally enforceable right to set off current tax assets against current tax liabilities; and
(ii) The deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority on either:
1) the same taxable entity; or
2) different taxable entities which intends to settle current tax assets and liabilities on a net basis, or to realize the assets and liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.

Deferred tax assets are recognized for the carry forward of unused tax losses, unused tax credits, and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefits will be realized; such reductions are reversed when the probability of future taxable profits improves.

(r) Earnings per share

The Company discloses the Company's basic and diluted earnings per share attributable to common shares holders of the Company. Basic earnings per share are calculated as the profit attributable to common shareholders of the Company divided by the weighted-average number of common shares outstanding. Diluted earnings per share are calculated as the profit attributable to common shareholders of the Company divided by the weighted-average number of common shares outstanding after adjustment for the effects of all potential dilutive common shares, such as employee bonus not yet resolved by the shareholders.

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HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(s) Operating segments

The Company discloses its segment information in the consolidated financial statements. Therefore, the Company need not disclose segment information in the parent Company only financial statements.

(5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty:

The preparation of the financial statements in conformity with the Regulations requires management to make judgments, estimates, and assumptions that affect the application of the accounting policies and the reported amount of assets, liabilities, income, and expenses. Actual results may differ from these estimates.

The management continues to monitor the accounting estimates and assumptions. It recognizes any changes in accounting estimates during the period and the impact of those changes in accounting estimates in the following period.

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities within the next financial year is as follows. Those assumptions and estimation have been updated to reflect the impact of COVID-19 pandemic:

Valuation of inventories

Because the Company's selling price is affected by international copper price, there is an uncertainty risk on the estimation of inventories' net realizable value resulting from the copper price fluctuations. Please refer to note 6(f) for further description of the valuation of inventories.

The Company's accouting policies and disclosing include measuring financial and non-financial assets at fair value.

The Company's financial instrument valuation group conducts independent verification on fair value by using data sources that are independent, reliable, and representative of exercise prices. This financial instrument valuation group also periodically adjusts valuation models, conducts back-testing, renews input data for valuation models, and makes all other necessary fair value adjustments to assure the rationality of fair value.

When measuring the fair value of an asset, the Company uses market observable data as far as possible. Fair values are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows.

(a) Level 1: quoted prices (unadjusted) in active markets for identified assets or liabilities.
(b) Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
(c) Level 3: inputs for the assets or liability that are not based on observable market data (unobservable inputs).

For any transfer within the fair value hierarchy, the impact of the transfer is recognized on the reporting date.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(6) Explanation of significant accounts:

(a) Cash and cash equivalents

December 31, 2020 Cash and cash on hand $ 200 Checking deposits and demand deposits 303,622 Cash and cash equivalents in the statement of cash flows $ 303,822	December 31, 2019
	264 260,482
	260,746

Please refer to note 6(y) for the exchange rate risk, sensitivity analysis and credit risk of the financial assets of the Company.

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

December 31, 2020 Mandatorily measured at fair value through profit or loss`：` Non-derivative financial assets Publicly traded stocks $ 2,601,049 Non-publicly traded stocks 482,832 $ 3,083,881 Classified as`：` Current $ 950,593 Non-current 2,133,288 $ 3,083,881	December 31, 2019
	2,658,663 292,653
	2,951,316
	728,131 2,223,185
	2,951,316

For the net gain or loss on financial assets at FVTPL, please refer to note 6(x).

The Company did not provide above financial assets at fair value through profit or loss as collateral or restricted.

		December 31,	December 31,
		2020	2019
Equity investments at fair value through other
comprehensive income`：`
Non-publicly traded stocks - International United
Technology Co., Ltd.	$	7,820	6,368
Non-publicly traded stocks - Pack & Proper Co.,
Ltd.		8,040	19,040
Non-publicly traded stocks - Global Corporation		-	9,819
Non-publicly traded stocks - United Electronics
Industrial Co., Ltd.		13,290	9,403
Non-publicly traded stocks - Taiwan Sugar
Corporation		26,766	26,692

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

December 31, 2020 Non-publicly traded stocks - Taiwan Submarine Cable Co.,Ltd. (Original name is Illchi United Trading Corporation) 220 Liquidation receivables of Global Corporation (from remaining property distribution) 2,839 $ 58,975	December 31, 2019
	300 -
	71,622

The Company designated its equity investments shown above as at fair value through other comprehensive income because these equity investments that the Company intends to hold for long-term strategic purposes.

During the years ended December 31, 2020 and 2019, the dividend income of $6,186 and $2,430, respectively, related to equity investments as fair value through other comprehensive income held on the years then ended, were recognized.

The amount of cash refunded from capital reduction of Global Corporation in 2020 was $15,541.

There were no disposals of strategic investments and transfers of any cumulative gain or loss within equity relating to these investments in 2020 and 2019.

For market risk information, please refer to note 6(y).

The Company did not provide above financial assets at fair value through other comprehensive income as collateral or restricted.

(d) Notes and accounts receivable

Notes and accounts receivable
December 31, 2020 Notes receivable from operating activities $ 9,521 Accounts receivable—measured at amortized cost 740,696 Less: Loss allowance - $ 750,217	December 31, 2019
	23,307 743,985 -
	767,292

The Company applies the simplified approach to provide for its expected credit losses, i.e. the use of lifetime expected loss provision for all receivables. To measure the expected credit losses, notes and accounts receivable have been grouped based on shared credit risk characteristics and the days past due, as well as incorporated forward looking information, including macroeconomic and relevant industry information. The loss allowance provision was determined as follows:

2020.12.31

Non-overdue Overdue	Gross carrying amounts of notes and accounts receivable $ 750,217 - $ 750,217	Weighted- average loss rate - -	Loss allowance provision
			- -
			-

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

2019.12.31 Gross carrying amounts of notes and accounts receivable Weighted-average loss rate Loss allowance provision Non-overdue $ 767,292 - - Overdue - - - $ 767,292 - The movement in the allowance for notes and accounts receivable were as follow: 2020 2019 Balance at January 1 (Balance at December 31) $ - - The Company did not provide notes and accounts receivable as collateral or restricted. For further credit risk information, please refer to note 6(y).		2019.12.31
			Loss allowance provision
			- -
			-

(e) Other receivables (including refundable deposits)

December 31, 2020 Other receivables-the difference of purchasing price of materials $ - Refundable deposits 1,356 Others 2,119 Less: Loss allowance - $ 3,475 December 31, 2020 Classified as: Other receivables $ 3,126 Refundable deposits 349 $ 3,475	December 31, 2019
	1,901 583 1,037 -
	3,521
	December 31, 2019
	3,159 362
	3,521

For further credit risk information, please refer to note 6(y).

(f) Inventories

December 31, 2020 Finished goods $ 680,603 Work in progress 384,184 Raw materials and supplies 190,807 Merchandise 33,946 Inventory in transit 222,737 $ 1,512,277	December 31, 2019
	609,260 403,164 174,466 55,785 239,794
	1,482,469

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

The details of the cost sales were as follows:

2020 Inventory that has been sold $ 4,710,164 Write-down of inventories (reversal of write-downs) (2,923) Unallocated production overheads 79,880 Construction cost 77,719 Others (10,270) $ 4,854,570	2019 4,711,732 (123) 72,654 383,022 (639) 5,166,646

The Company did not provide any inventories as collateral or restricted.

(g) Investments accounted for using equity method
(i) A summary of the Company's financial information for investments accounted for using the equity method at the reporting date as follows:

December 31, 2020 Subsidiaries $ 591,758 Associates 11,617 $ 603,375	December 31, 2019
	556,530 12,676
	569,206

(ii) Subsidiaries

Please refer the consolidated financial statement for the years ended December 31,2020.

(iii) The Company's financial information for investments accounted for using the equity method that are individually insignificant was as follows:

December 31, 2020 Carrying amount of individually insignificant associates’ equity $ 11,617 2020 Attributable to the Company: Loss from continuing operations $ (1,059) Other comprehensive income - Total comprehensive income $ (1,059)	December 31, 2019 12,676 2019 (1,152) - (1,152)

(iv) Collateral

The Company did not provide any investments accounted for using the equity method as collateral for its loans.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(h) Changes in a parent's ownership interest in a subsidiary

In 2019, the Company acquired an additional interest in First Copper Technology Co., Ltd. for $82,263 in cash increasing its ownership from 37.17% to 39.44%.

The effects of the changes in shareholdings were as follows:

The effects of the changes in shareholdings were as follows:
		2019
Carrying amount of non-controlling interest on acquisition
	$	85,726
Consideration paid to non-controlling interests		(82,263)
Capital surplus differences between consideration and carrying amounts
subsidiaries acquired	$	3,463

(i) Property, plant and equipment

The Cost, depreciation, and impairment of the property, plant and equipment of the Company were as follows:

Land Cost or deemed cost: Balance at January 1, 2020 $ 1,551,602 Additions - Disposals - Balance at December 31, 2020 $ 1,551,602 Balance at January 1, 2019 $ 1,551,602 Additions - Reclassifications - Disposals - Balance at December 31, 2019 $ 1,551,602 Depreciation and impairment loss: Balance at January 1, 2020 $ - Depreciation - Disposals - Balance at December 31, 2020 $ - Balance at January 1, 2019 $ - Depreciation - Disposals - Balance at December 31, 2019 $ - Carrying amounts: Balance at December 31, 2020 $ 1,551,602 Balance at January 1, 2019 $ 1,551,602 Balance at December 31, 2019 $ 1,551,602	Buildings 1,047,609 10,934 (120) 1,058,423 1,034,608 12,342 3,804 (3,145) 1,047,609 860,124 26,727 (120) 886,731 836,785 25,542 (2,203) 860,124 171,692 197,823 187,485	Machinery and equipment 2,629,681 26,234 (109,882) 2,546,033 2,582,631 53,326 3,952 (10,228) 2,629,681 2,462,835 44,581 (109,687) 2,397,729 2,429,346 43,717 (10,228) 2,462,835 148,304 153,285 166,846	Other equipment 89,749 1,670 (3,776) 87,643 86,109 5,792 92 (2,244) 89,749 80,552 2,565 (3,776) 79,341 80,688 2,108 (2,244) 80,552 8,302 5,421 9,197	Construction in progress and testing equipment 205,736 21,458 - 227,194 199,483 14,101 (7,848) - 205,736 - - - - - - - - 227,194 199,483 205,736	Total 5,524,377 60,296 (113,778) 5,470,895 5,454,433 85,561 - (15,617) 5,524,377 3,403,511 73,873 (113,583) 3,363,801 3,346,819 71,367 (14,675) 3,403,511 2,107,094 2,107,614 2,120,866

The property, plant and equipment of the Company has not been pledged as collateral or restricted.

For the gains or losses on disposal of the property, plant and equipment, please refer to note 6(x).

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(j) Right-of-use assets

Information about leases land for which the Company as a lessee was presented below:

		Land
Cost:
Balance at January 1, 2020	$	369,153
Balance at December 31, 2020	$	369,153
Balance at January 1, 2019	$	369,153
Balance at December 31, 2020	$	369,153
Accumulated depreciation:
Balance at January 1, 2020	$	23,072
Depreciation for the year		23,072
Balance at December 31, 2020	$	46,144
Balance at January 1, 2019	$	-
Depreciation for the year		23,072
Balance at December 31, 2019	$	23,072
Carrying amount:
Balance at December 31, 2020	$	323,009
Balance at December 31, 2019	$	346,081

(k) Investment property

The details of investment property were as follows:

Owned property Land and improvements Buildings and others Cost or deemed cost: Balance at January 1, 2020 $ 760,574 160,763 Additions 61,252 267 Disposals - (8,001) Balance at December 31, 2020 $ 821,826 153,029 Balance at January 1, 2019 $ 760,574 160,613 Additions - 150 Balance at December 31, 2019 $ 760,574 160,763	Total 921,337 61,519 (8,001) 974,855 921,187 150 921,337

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

		Owned	property
		Land and	Buildings
		improvements	and others		Total
Depreciation and impairment loss:
Balance at January 1, 2020	$	-	86,951		86,951
Depreciation		-	5,067		5,067
Disposals		-	(8,001)		(8,001)
Balance at December 31, 2020	$	-	84,017		84,017
Balance at January 1, 2019	$	-	81,789		81,789
Depreciation		-	5,162		5,162
Balance at December 31, 2019	$	-	86,951		86,951
Carrying amount:
Balance at December 31, 2020	$	821,826	69,012		890,838
Balance at January 1, 2019	$	760,574	78,824		839,398
Balance at December 31, 2019	$	760,574	73,812		834,386
Fair value:
Balance at December 31, 2020				$	1,171,337
Balance at December 31, 2019				$	1,127,916

The Company did not have any non-cancellable lease or contingent rental. For information about investment property leases, please refer to note 6(q).

As of December 31, 2020 and 2019, the fair value of the investment property was determined based on comparative method and cost method by the Company. The recurring fair value measurement for the investment property based on the inputs of levels of fair value hierarchy in determining the fair value is classified to Level 3.

Investment property of the Company has not been pledged as collateral or restricted.

(l) Other current assets and other non-current assets

The other current assets and other non-current assets of the Company were as follows:

December 31, 2020 Prepaid expenses $ 3,289 Prepaid raw materials and construction 157 Excess business tax paid and refundable tax 4,340 Others 9,222 $ 17,008 Current $ 8,133 Non-current 8,875 $ 17,008	December 31, 2019
	4,030 12,242 15,766 10,240
	42,278
	32,358 9,920
	42,278

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(m) Short-term borrowings

Details of short-term borrowings of the Company were as follows:

Details of short-term borrowings of the Company were as follows:
December 31, 2020 Letters of credit $ 140,050 Unsecured loans 710,000 Total $ 850,050 Unused credit lines $ 2,020,831 Range of interest rates 0.90%`～`0.97%	December 31, 2019
	203,643 453,000
	656,643
	2,035,534
	0.55%`～`2.69%

The Company did not provide any assets as collateral for short-term borrowings.

Please refer to note 6(y) for exchange rate risk, interest rate risk, sensitive analysis and liquid risk of the financial liabilities of the Company.

(n) Short-term notes and bills payable

Details of short-term notes and bills payable of the Company were as follows:

December 31, 2020 Commercial paper payable $ 899,765 Range of interest rates 0.948%~0.950%	December 31, 2019
	899,713
	0.988%~0.998%

The Company did not provide any assets as collateral for short-term notes and bills payable.

Unused credit lines for short-term notes and bills payable are combined in short-term borrowings, please refer to note 6(m).

(o) Other current liabilities

Details of other current liabilities of the Company were as follows:

December 31, 2020 Advance receipts $ 3,407 Provision of onerous contracts 559 Others 42 $ 4,008	December 31, 2019
	2,422 1,780 2,031
	6,233

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

The movement of provisions were as follows:

		Onerous
		contracts
Balance at January 1, 2020	$	1,780
Provisions used and reversed during the year		(3,618)
Provisions made during the year		2,397
Balance at December 31, 2020	$	559
Balance at January 1, 2019	$	5,890
Provisions used and reversed during the year		(5,879)
Provisions made during the year		1,769
Balance at December 31, 2019	$	1,780

The movement of provisions of onerous contracts were included in other gains or losses of nonoperating income and expense in the statements of comprehensive income, please refer to 6(x).

(p) Lease liabilities

The carrying amounts of lease liabilities of the Company was as follows:

The carrying amounts of lease liabilities of the Company was as follows:
December 31, 2020 Current $ 16,027 Non-current $ 231,025	December 31, 2019
	15,796
	247,052

For the maturity analysis, please refer to note 6(y) financial instruments.

The amounts recognized in profit or loss was as follows:

Interest on lease liabilities Expenses relating to short-term leases	2020 $ 3,795 $ 566	2019
		3,795
		1,591

The amounts recognized in the statement of cash flows for the Company was as follows:

Total cash outflow for leases	2020 $ 19,929	2019
		20,967

(i) Real estate leases

The Company leases land from Taiwan Sugar Corporation for its plant. The leases of plant typically run for a period of 40 years.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

Leases provide for additional rent payments that are based on changes in declared land price.

(ii) Other leases

The Company also leases some office space and equipment. These leases are short-term with a lease term of less than one year. The Company has elected not to recognize right-of-use assets and lease liabilities for these leases.

(q) Operating lease

Leases as lessor

The Company leases out its investment property. The Company has classified these leases as operating leases, because it does not transfer substantially all of the risks and rewards incidental to the ownership of the assets. Please refer to note 6(k) sets out information about the operating leases of investment property.

A maturity analysis of lease payments, showing the undiscounted lease payments to be received after the reporting date are as follows:

December 31, 2020 Less than one year $ 31,036 One to two years 11,417 Two to three years 5,253 Three to four years 1,680 Four to five years 1,260 Total undiscounted lease payments $ 50,646	December 31, 2019
	24,129 19,232 6,670 1,401 -
	51,432

In 2020 and 2019, the rental income for investment property amounting to $30,664 and $24,326, respectively, is included in other income in the statements of comprehensive income.

The direct expenses including repairs and maintenance arising from income-generating investment property amounting to $3,833 and $2,869 in 2020 and 2019, respectively, are included in other gains and losses in the statements of comprehensive income.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(r) Employee benefits

(i) Defined benefit plans

Reconciliation of defined benefit obligation at present value and plan asset at fair value were as follows:

December 31, 2020 Present value of the defined benefit obligations $ 331,224 Fair value of plan assets (312,431) Net defined benefit liabilities $ 18,793	December 31, 2019 344,660 (326,436) 18,224

The Company makes defined benefit plan contributions to the labor pension fund account and manager pension fund account, respectively, with Bank of Taiwan. Such accounts provide pensions for employees upon retirement. Plans (covered by the Labor Standards Law) entitle retired employees to receive retirement benefits based on years of service and average monthly salary for the six months prior to retirement.

1) Composition of plan assets

The Company allocates its labor pension funds in accordance with the Labor Standards Law, and such funds are managed by the Bureau of Labor Funds, Ministry of Labor. According to the Regulations for Revenues, Expenditures, Safeguard and Utilization of the Labor Retirement Fund, the minimum earnings of the funds will be no less than the earnings attainable from two-year time deposits, with interest rates offered by local banks.

The balance of the Company's pension reserve accounts for labor and managers in Bank of Taiwan amounted to $312,431 at the end of the reporting period. For information on the utilization of the labor pension fund assets including the asset allocation and yield of the fund, please refer to the website of the Bureau of Labor Funds, Ministry of Labor. The pension funds for mangers deposited with time deposits and demand deposits.

2)

Movements in present value of the defined benefit obligations

The movements in present value of the defined benefit obligations for the Company were as follows:

		2020	2019
Defined benefit obligations at January 1	$	344,660	335,798
Current service costs and interest		5,372	6,123

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

2020 Remeasurement of the net defined benefit liabilities : –Actuarial loss (gain) arising from change in financial assumptions 13,307 –Actuarial loss (gain) arising from experience adjustments 4,046 Benefits paid by the plan (36,161) Defined benefit obligations at December 31 $ 331,224	2019 3,560 10,092 (10,913) 344,660

3) Movements of defined benefit plan assets The movements in the present value of the defined benefit plan assets for the Company were as follows:

2020 Fair value of plan assets at January 1 $ 326,436 Interest income 3,186 Remeasurements of the net defined benefit liabilities: -Return on plan assets (excluding interest income) 9,372 Contributions made 9,598 Benefits paid by the plan (36,161) Fair value of plan assets at December 31 $ 312,431	2019 251,969 2,761 8,782 73,837 (10,913) 326,436

4) Expenses recognized in profit or loss

The expenses recognized in profit or loss for the Company were as follows:

2020 Current service costs $ 2,052 Net interest of net liabilities for defined benefit obligations 134 $ 2,186 Operating costs $ 1,925 Operating expenses 261 $ 2,186	2019
	2,476 886
	3,362
	2,965 397
	3,362

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

5) Actuarial assumptions

The principal actuarial assumptions at the reporting date were as follows:

Discount rate Future salary increase rate	December 31, 2020 December 31, 2019 0.500 % 1.000 % % 1.000 % 1.000

The expected allocation payment to be made by the Company to the defined benefit plans for the one-year period after the reporting date is $9,198.

The weighted-average lifetime of the defined benefits plans is 9.92 years.

6) Sensitivity analysis

If the actuarial assumptions had changed, the impact on the present value of the defined benefit obligation shall be as follows:

		Influences of defined benefit	Influences of defined benefit
		obligations
		Increased	Decreased
As of December 31, 2020
Discount rate (Decreasing or increasing in
0.25%)	$	(6,757)	6,971
Future salary increasing rate (Decreasing or
increasing in 0.25%)		6,760	(6,587)
As of December 31, 2019
Discount rate (Decreasing or increasing in
0.25%)	$	(7,063)	7,293
Future salary increasing rate (Decreasing or
increasing in 0.25%)		7,113	(6,924)

Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions constant, would have affected the defined benefit obligation by the amounts shown above. The method used in the sensitivity analysis is consistent with the calculation of pension liabilities in the balance sheets.

There is no change in the method and assumptions used in the preparation of sensitivity analysis for 2020 and 2019.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(ii) Defined contribution plans

The Company allocates 6% of each employee’s monthly wages to the labor pension personal account at the Bureau of Labor Insurance in accordance with the provisions of the Labor Pension Act. Under these defined contribution plans, the Company allocates a fixed amount to the Bureau of Labor Insurance without additional legal or constructive obligation.

The Company recognized the pension costs under the defined contribution method amounting to $10,876 and $10,609 for 2020 and 2019, respectively. The payment was made to the Bureau of Labor Insurance. As of December 31, 2020 and 2019, the payables which had not been contributed to the Bureau of Labor Insurance were $2,072 and $2,018, respectively, and they were recognized as notes payable and other payables in the balance sheets.

(iii) Short-term benefit obligation

As of December 31, 2020 and 2019, the Company’s short-term benefit liabilities for vacation were $13,813 and $13,882, respectively, and were recognized as other payables in the balance sheets.

(s) Income taxes

(i) The amount of income tax expense (benefit) was as follows:

		2020	2019
Current tax expense (benefit)
Adjustment for prior years	$	-	(110)
Deferred tax expense (benefit)
Origination and reversal of temporary
differences and tax losses		55,115	(54,248)
Change in unrecognized deferred tax assets of
deductible temporary differences and tax
losses		(1,474)	(14,090)
		53,641	(68,338)
Income tax expense (benefit)	$	53,641	(68,448)
No income tax was recognized directly in equity or other		comprehensive income for 2020 and
2019.
Reconciliation of income tax expense (benefit) and profit		(loss) before tax for 2020 and 2019
were as follows:
		2020	2019
Profit before income tax	$	377,305	724,205
Income tax using the Company’s domestic tax rate	$	75,461	144,841
Unrealized gains on valuation of financial assets		(7,994)	(121,749)
Dividends income		(17,271)	(15,224)
Dividends income which does not count in tax loss
carryforward		-	16,678

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

2020 Effect of investment losses under equity method 4,809 Changes in unrecognized temporary differences and tax losses (1,474) Compensate for reduction of investees - Adjustments for prior periods - Others 110 $ 53,641	2019 7,794 (14,090) (86,583) (110) (5) (68,448)

(ii) Deferred tax assets and liabilities
1) Unrecognized deferred tax assets

Deferred tax assets of the Company have not been recognized in respect of the following items:

items:
December 31, 2020 Defined benefits plan $ 18,019	December 31, 2019
	17,406

2) Recognized deferred tax assets and liabilities

Changes in the amount of deferred tax assets and liabilities for 2020 and 2019 were as follows:

Adjustment of difference of useful life of PPE between financial and tax method Deferred tax liabilities: Balance at January 1, 2020 $ 10 Debit (credit) profit or loss (1) Balance at December 31, 2020 $ 9 Balance at January 1, 2019 $ 11 Debit (credit) profit or loss (1) Balance at December 31, 2019 $ 10 Allowance for inventories losses Deferred tax assets: Balance at January 1, 2020 $ 3,320 Credit (debit) profit or loss (584) Balance at December 31, 2020 $ 2,736 Balance at January 1, 2019 $ 3,345 Credit (debit) profit or loss (25) Balance at December 31, 2019 $ 3,320		Unrealized foreign exchange gains - 26 26 29 (29) - Tax loss carry- forward 67,582 (53,638) 13,944 - 67,582 67,582	Land value increment tax provision 521,382 - 521,382 521,382 - 521,382 Others 11,843 606 12,449 11,092 751 11,843	Total 521,392 25 521,417 521,422 (30) 521,392 Total 82,745 (53,616) 29,129 14,437 68,308 82,745

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(iii) Assessment of tax

The Company's income tax returns for the years through 2018 were assessed by the tax authorities.

(t) Capital and other equity

(i) Capital stock

As of December 31, 2020 and 2019, the authorized shares capital of the Company were both $6,327,735, comprising 632,774 thousand shares, with a par value $10. All issued shares were paid up upon issuance.

(ii) Capital surplus

The balances of capital surplus were as follows:

December 31, 2020 Treasury share transactions $ 54,290 Difference arising from subsidiary's share price and its carrying value 3,463 $ 57,753	December 31, 2019
	- 3,463
	3,463

According to the ROC Company Act, capital surplus can only be used to offset a deficit, and only the realized capital surplus can be used to increase the common stock or be distributed as cash dividends. The aforementioned realized capital surplus includes capital surplus resulting from premium on issuance of capital stock and earnings from donated assets received. According to the Regulations Governing the Offering and Issuance of Securities by Securities Issuers, capital increases by transferring capital surplus in excess of par value should not exceed 10% of the total common stock outstanding.

(iii) Retained earnings

According to the Company's articles of incorporation, current-period earnings should first be used to settle all outstanding tax payables and accumulated deficit, and then 10% should be retained as legal reserve until the accumulated legal reserve equals the issued capital stock, and special reserve should be retained or reversed according to the Company's operating environment and statutory requirements. Thereafter, any remaining profit, together with any undistributed prior-period retained earnings, shall be distributed at the discretion of the board of directors and with the resolution to be approved during the stockholders' meeting.

The industry of operation of the Company still has good prospects. The Company will grasp the economic environment for sustainable operation and long-term development. When preparing the proposal for appropriation of net profit, the board of directors will follow a stable dividend policy, which will be based on the Company's expected profit in the future, and plan for operating capital, thereafter, a portion of net profit should be retained. Cash dividends should not be less than 10% of total dividends.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

1) Legal reserve

When the Company incurs no loss, it may, pursuant to a resolution approved during the shareholder's meeting, distribute its legal reserve by issuing new shares or by distributing cash, and only the portion of legal reserve which exceeds 25% of capital may be distributed.

2) Special reserve

According to Securities and Futures Bureau (SFB, former SFC) regulations, the investment income resulting from the sale of long-term equity investment in First Copper Technology Co., Ltd. in 1988 should be treated as unrealized gain, and such gain cannot be distributed until such long-term equity investment is resold. As of December 31, 2020 and 2019, the amount of the unrealized gain was $95,408.

By choosing to apply exemptions granted under IFRS 1 First-time Adoption of International Financial Reporting Standards during the Company's first-time adoption of the IFRSs approved by the FSC, unrealized revaluation gains shall be reclassified as unappropriated retained earnings at the adoption date. According to regulations, the increase in retained earnings amounted to $888,766. It exceeded the increase in retained earnings occurring before the date of first-time adoption of IFRSs amounting to $776,576. In accordance with Ruling No. 1010012865 issued by the FSC on April 6, 2012, an increase in retained earnings due to the first-time adoption of IFRSs shall be retained as a special reserve, and when the relevant assets are used, disposed of, or reclassified, this special reserve shall be reversed as distributable earnings proportionately.

In accordance with the guidelines of the above Ruling, a portion of current-period earnings and undistributed prior-period earnings shall be retained as a special reserve. The amount to be retained should be equal to the current-period total reduction of other shareholders' equity. Similarly, a portion of undistributed prior-period earnings shall be reclassified as a special reserve (which does not qualify for earnings distribution) to account for cumulative changes to other shareholders' equity pertaining to prior periods. Amounts of subsequent reversals pertaining to the net reduction of other shareholders' equity shall qualify for additional distributions. As of the carrying amount of special reserve amounted to $794,098 and $776,576 on December 31, 2020 and 2019, respectively.

In accordance with Rule No. 1010047490 issued by the Financial Supervisory Commission (“ FSC” ) on November 21, 2012, if the market value of the Company's shares is lower than the carrying value of the Company's shares held by subsidiaries at year-end, the Company should retain a special reserve amounting to the difference between the market value and the carrying value, based upon the Company's ownership percentage in the subsidiaries. When market value rebounds, the Company could reverse the special reserve. As of December 31, 2020 and 2019, the balance of special reserve amounted to $150,191 and $1,887, respectively.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

3) Earnings distribution

Earnings distribution for 2019 was decided by the general meeting of shareholders held on June 17, 2020. The relevant dividend distributions to shareholders was as follows:

		2019
	Amount per share
		(in dollars)	Amount
Dividends distributed to ordinary
shareholders:
Cash	$	0.66	417,631

In 2018, the Company incurred loss, the legal reserve and capital surplus amounting to $348,038 was used to offset accumulated deficit, with the approval of the general meeting of shareholders held on June 12, 2019.

Earnings distribution for 2020 was proposed by the resolution adopted, at the general meeting of shareholders held on March 22, 2021. The relevant dividend distributions to shareholders was as follows:

shareholders was as follows:
		2020
	Amount per share
		(in dollars)	Amount
Dividends distributed to ordinary
shareholders:
Cash	$	0.7	442,941

Related Information would be available at the Market Observation Post System website after the approval from the shareholders.

(iv) Treasury stock

First Copper Technology Co., Ltd, controlled by the Company, held the Company's common stocks for finance management. Such shares are treated as treasury stock in preparation of financial statements. As of December 31, 2020 and 2019, the investee, First Copper Technology Co., Ltd., held 208,564 thousand shares of the Company's common stock, and their market values amounted to $2,857,324 and $2,075,210, respectively. The total amount which the Company recognized as treasury stock were both $968,671.

(v) Other equity (net of tax)

Other equity (net of tax)
		Financial assets measured	at
		fair value through other
		comprehensive income
Balance at January 1, 2020	$	(44,801)
Unrealized gains (losses) from financial assets
measured at fair value through other comprehensive
income			512
Unrealized gains (losses) from receivables			2,382
Unrealized gains (losses) from financial assets
measured at fair value through other comprehensive
income of subsidiaries accounted for using equity
method			1,125
Balance at December 31, 2020	$	(40,782)

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

		Financial assets measured at
		fair value through other
		comprehensive income
Balance at January 1, 2019	$	(27,279)
Unrealized gains (losses) from financial assets
measured at fair value through other comprehensive
income		(17,270)
Unrealized gains (losses) from financial assets
measured at fair value through other comprehensive
income of subsidiaries accounted for using equity
method		(252)
Balance at December 31, 2019	$	(44,801)

(u) Earnings per share

The calculation of basic earnings per share and diluted earnings per share for the years ended December 31, 2020 and 2019, were as follows (excluding 208,564 thousand shares, of common stock outstanding held by the Company's subsidiaries as treasury stock):

2020 Basic earnings per share Profit attributable to ordinary shareholders of the Company $ 323,664 Weighted-average number of common shares outstanding (shares in thousands) 424,210 Basic earnings per share (in dollars) $ 0.76 Diluted earnings per share Profit attributable to ordinary shareholders of the Company (After adjusting to dilutive potential ordinary share effect) $ 323,664 Weighted-average number of common shares outstanding (shares in thousands) 424,210 Effect of dilutive potential ordinary shares Effect of employee share bonus (shares in thousands) 1,469 Weighted-average number of common shares outstanding (shares in thousands) (After adjusting to dilutive potential ordinary share effect) 425,679 Diluted earnings per share (in dollars) $ 0.76		2019 792,653 424,210 1.87 792,653 424,210 1,838
		426,048 1.86

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(v) Revenue from contracts with customers
(i) Disaggregation of revenue

	2020	2020
Wire $ 1,504,658 312,448 18,576 $ 1,835,682 $ 1,686,066 - 4,521 - 145,095 $ 1,835,682 $ 1,835,682 - $ 1,835,682 Wire $ 1,663,609 233,520 92,134 $ 1,989,263	Cable Other 3,267,950 105,405 2,305 - - 388 3,270,255 105,793 - - 2,879,015 - 1,908 - - 87,580 389,332 18,213 3,270,255 105,793 3,270,255 18,213 - 87,580 3,270,255 105,793 2019		Total
			4,878,013 314,753 18,964
			5,211,730
			1,686,066 2,879,015 6,429 87,580 552,640
			5,211,730
			5,124,150 87,580
			5,211,730

	Cable 2,929,404 8,484 161 2,938,049	Other 416,928 - - 416,928	Total
			5,009,941 242,004 92,295
			5,344,240

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

2019 Wire Cable Other Total Major products/services lines: Oxygen free copper wire $ 1,804,959 - - 1,804,959 Wire and cable - 2,687,560 - 2,687,560 Processing revenue 20,227 912 5 21,144 Contract revenue - - 374,324 374,324 Others 164,077 249,577 42,599 456,253 Total $ 1,989,263 2,938,049 416,928 5,344,240 Timing for revenue recognition: Products transferred at a point in time $ 1,989,263 2,938,049 42,604 4,969,916 Construction transferred over time - - 374,324 374,324 Total $ 1,989,263 2,938,049 416,928 5,344,240 Contract balances December 31, 2020 December 31, 2019 January 1, 2019 Notes and accounts receivable $ 750,217 767,292 850,540 Less: allowance for impairment - - - Total $ 750,217 767,292 850,540 Contract assets`－`construction $ 68,990 117,149 91,347 Contract liabilities`－`construction $ 2,292 8,499 62,743 Contract liabilities`－`advance sales receipts 8,956 20,476 8,130 Total $ 11,248 28,975 70,873		2019	2019
				Total
				1,804,959 2,687,560 21,144 374,324 456,253
				5,344,240
				4,969,916 374,324
				5,344,240
			850,540 -
			850,540
			91,347
			62,743 8,130
			70,873

(ii) Contract balances

For additional information on accounts receivable and allowance for impairment, please refer to note 6(d).

For details on onerous contracts as of December 31, 2020 and 2019, please refer to note 6(o).

The amount of revenue which was recognized in the year ended December 31, 2020 and 2019, and included in the contract liability balance at January 1, 2020 and 2019 were $28,975 and $64,343, respectively.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

The major change in the balance of contract assets and contract liabilities is the difference between the time frame in the performance obligation to be satisfied and the payment to be received.

(w) Remuneration to employees and directors

In accordance with the Articles of incorporation, the Company should contribute a minimum of 3% of its profit as employee remuneration and a maximum of 2% as directors' remuneration when there is profit for the year. However, if the Company has accumulated deficits, the profit should first be used to offset against its deficits.

For the years ended December 31, 2020 and 2019, the Company estimated its employee remuneration amounting to $11,730 and $18,288, and directors' remuneration amounting to $1,955 and $3,048. The estimated amounts mentioned above were calculated based on the net profit before tax, excluding the remuneration to employees and directors of each period, multiplied by the percentage of remuneration to employees and directors as specified in the Company's articles. These remunerations were expensed under operating cost or operating expenses during 2020 and 2019. If there are any subsequent adjustments to the actual remuneration amounts, the adjustment will be accounted for as changes in accounting estimates and will be reflected in profit or loss in the following year. If employee remuneration is distributed by shares, the numbers of shares should be calculated based on the closing price one day before the date of the board meeting. The related information would be available at the Market Observation Post System website.

The amounts, as stated in the financial statements, are identical to those of the actual distributions for 2020. For the years ended 2019, the Company estimated its employee remuneration amounting to $18,288, and directors' remuneration amounting to $3,048. There was difference of $102 between the actual distribution of employee remuneration of $18,201 as well as directors' remuneration of $3,033, and the estimated amounts decided during the board meeting. The above difference was recognized as changes in accounting estimates and reflected in profit or loss in 2020.

(x) Non-operating income and expenses

(i) Interest income

Details of interest income of the Company were as follows:

Details of interest income of the Company were as follows:
2020 Interest income $ 42 (ii) Other income	2019
	74

Details of other income of the Company were as follows:

2020 Dividend income $ 90,862 Rental income 32,101 Revenue from sale of scrap 2,682 Directors' and supervisors' remuneration 1,845 Others 786 $ 128,276	2019
	76,122 25,883 1,431 2,506 1,940
	107,882

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(iii) Other gains and losses

The details of other gains and losses of the Company were as follows:

2020 Foreign exchange gains (loss), net $ 9,565 Net gains of financial assets at fair value through profit or loss 39,972 Net gains (losses) on disposal of property, plant and equipment 618 Depreciation of investment property (5,067) Others (3,502) $ 41,586	2019 (81) 608,745 (1,031) (5,162) 1,235 603,706

(iv) Finance costs

The details of finance costs of the Company were as follows:

2020 Interest expenses Bank loans and short-term notes payable $ (11,067) Lease liabilities (3,567) Others (39) $ (14,673)	2019 (9,830) (3,795) (36) (13,661)

(y) Financial instruments

(i) Categories of financial instruments

1) Financial assets

December 31, 2020 Financial assets at fair value through profit or loss: Mandatorily measured at fair value through profit or loss $ 3,083,881 Financial assets at fair value through other comprehensive income: Equity instrument investments 56,136 Liquidation receivables 2,839 Subtotal 58,975 Financial assets measured at amortized cost: Cash and cash equivalents 303,822 Notes receivable, accounts receivable, and other receivables 753,343 Refundable deposits 349 Subtotal 1,057,514 Total $ 4,200,370	December 31, 2019
	2,951,316
	71,622 -
	71,622
	260,746 770,451 362
	1,031,559
	4,054,497

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

2) Financial liabilities

December 31, 2020 Financial liabilities at amortized cost: Short-term borrowings $ 850,050 Short-term notes and bills payable 899,765 Payables (including related parties) 391,077 Lease liabilities (including current portion) 247,052 Guarantee deposits received 4,266 Total $ 2,392,210	December 31, 2019
	656,643 899,713 336,605 262,848 3,606
	2,159,415

(ii) Credit risk
1) Credit risk exposure

The carrying amount of financial assets and contract assets represents the maximum amount exposed to credit risk.

2) Concentration of credit risk

The cash is deposited in different financial institutions. The Company manages the credit risk exposure with each of these financial institutions and believes that cash do not have a significant credit risk concentration.

The major customers of the Company are centralized in industries within similar areas and dealers. As of December 31, 2020 and 2019, one customer accounted for 51.01% and 47.11% of the notes and accounts receivable, respectively, resulting in a concentration of credit risk.

3) Credit risk of receivables

For credit risk exposure of notes and accounts receivable, please refer to note 6(d). Other financial assets at amortized cost includes other receivables and other financial assets (refundable deposits).

All of these other financial assets at amortized cost are considered to have low risk, and thus, the impairment provision recognized during the period was limited to 12 months expected losses. (Regarding how the financial instruments are considered to have low credit risk, please refer to note 4(f)). No impairment losses allowance were recognized or reversed for the years ended December 31, 2020 and 2019.

(iii) Liquidity Risk

Details of financial liabilities categorized by due dates were as follows. The amounts include estimated interest payments but exclude the impacts of netting agreements.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

Carrying amount December 31, 2020 Non-derivative financial liabilities Short-term borrowings $ 850,050 Short-term notes and bills payable 899,765 Notes payable 5,200 Accounts payable (including related parties) 266,844 Other payables 119,033 Lease liabilities (including current portion) 247,052 Guarantee deposits received 4,266 $ 2,392,210 December 31, 2019 Non-derivative financial liabilities Short-term borrowings $ 656,643 Short-term notes and bills payable 899,713 Notes payable 5,119 Accounts payable (including related parties) 297,472 Other payables 34,014 Lease liabilities (including current portion) 262,848 Guarantee deposit received 3,606 $ 2,159,415	Contractual cash flows 850,578 900,000 5,200 266,844 119,033 271,082 4,266 2,417,003 658,472 900,000 5,119 297,472 34,014 290,445 3,606 2,189,128	Within 6 months 850,578 900,000 5,200 266,844 117,888 9,681 826 2,151,017 658,472 900,000 5,119 297,472 34,014 9,681 226 1,904,984	6-12 months - - - - 255 9,682 200 10,137 - - - - - 9,682 880 10,562	1-2 years - - - - - 19,363 1,820 21,183 - - - - - 19,363 200 19,563	2-5 years - - - - 890 58,089 1,420 60,399 - - - - - 58,089 2,300 60,389	Over 5 years
						- - - - - 174,267 -
						174,267
						- - - - - 193,630 -
						193,630

The Company does not expect that the cash flows included in the maturity analysis could occur significantly earlier or at significantly different amounts.

(iv) Foreign currency risk

1) Exposure to foreign currency risk

The Company's significant financial assets and liabilities exposed to foreign currency risk were as follows:

December 31, 2020 Foreign currency Exchange rate TWD Financial assets Monetary items USD $ 365 28.48 10,401 HKD 92 3.673 338 Financial liabilities Monetary items USD 877 28.48 24,946 JPY 90,989 0.2763 25,140	December 31, 2019	December 31, 2019
	Foreign currency 468 29 1,410 9,405	Exchange rate TWD 29.98 14,038 3.849 112 29.98 42,384 0.2760 2,596

2) Sensitivity analysis

The foreign currency risk was mainly incurred from the translation of cash and cash equivalents, accounts receivable, other receivables, short-term borrowings, accounts payable, and other payables. As of December 31, 2020 and 2019, if the exchange rate of the NTD versus the USD, HKD, JPY and EUR had increased or decreased by 1%, given no changes in other factors, the impact were as follows:

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

2020 Depreciate 1% Appreciate 1% Decrease in net profit after tax Increase in net profit after tax $ 315 315	2019	2019
Depreciate 1% Decrease in net profit after tax $ 315	Depreciate 1% Decrease in net profit after tax 247	Appreciate 1%
		Increase in net profit after tax
		247

The analysis is performed in the same basis for 2020 and 2019.

3) Exchange gains and losses from monetary items

The exchange gains (losses) (including realized and unrealized) that resulted from monetary were as follows:

2020 Exchange gains (losses) USD $ 9,584 Others (19) Total $ 9,565	2019 Exchange gains (losses) (33) (48) (81)

(v) Interest rate analysis

Please refer to the notes on liquidity risk management and the interest rate exposure of the Company's financial liabilities.

The sensitivity analysis of interest was determined based on the interest rate of derivative and non-derivative instruments at the reporting date. The analysis of liabilities bearing floating interest rates was prepared based on the assumption that the outstanding amounts at the reporting date had existed for the whole year. Management adopted 0.25% as a reasonable change in interest rates, and therefore evaluated the impacts of 0.25% changes in interest rates.

If interest rates on borrowings had increased or decreased 0.25%, with all other variables held constant, the information was as follows:

2020 Increase 0.25% Decrease 0.25% Decrease in net profit after tax Increase in net profit after tax $ 1,700 1,700	2019	2019
Increase 0.25% Decrease in net profit after tax $ 1,700	Increase 0.25% Decrease in net profit after tax 1,313	Decrease 0.25%
		Increase in net profit after tax
		1,313

The impact was due to the floating interest rates of bank loans.

(vi) Equity securities prices risk

If the prices of equity securities change at reporting date, with all other variables held constant, the influences on other comprehensive income, were as follows:

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

	2020	2020	2020							2019
	Other								Other
	Prices at comprehensive					Net			comprehensive		Net
reporting date income after tax				income					income after tax		income
Increase by 1% $		561				30,839				716	29,513
Decrease by 1% $		(561)			(30,839)					(716)	(29,513)
Fair	value of financial instruments
1)	Fair value of financial instruments
	The fair value of financial assets			at fair	value through profit or loss and at						fair value
	through other comprehensive	income is				measured on recurring				basis. The carrying
	amount and fair value of the Company's					financial assets and liabilities, including the
	information on fair value hierarchy were					as	follow;		however, except as described in
	following paragraphs, for financial			instruments			not measured at fair			value whose carrying
	amount is reasonably close to the fair value, and							lease	liabilities, disclosure of		fair value
	information is not required:
								December 31, 2020
		Carrying							Fair Value
			amount			Level 1			Level 2	Level 3	Total
	Financial assets at fair value through
	profit or loss
	Publicly traded stocks	$	2,601,049			2,601,049			-	-	2,601,049
	Non-publicly traded stocks			482,832			445,212		-	37,620	482,832
	Total	$	3,083,881
	Financial assets at fair value through
	other comprehensive income
	Non-publicly traded stocks	$		56,136				-	-	56,136	56,136
	Receivables-the distribution of
	remaining on liquidation			2,839				-	2,839	-	2,839
	Total	$		58,975
								December 31, 2019
		Carrying							Fair Value
			amount			Level 1			Level 2	Level 3	Total
	Financial assets at fair value through
	profit or loss
	Publicly traded stocks	$	2,658,663			2,658,663			-	-	2,658,663
	Non-publicly traded stocks			292,653			260,793		-	31,860	292,653
	Total	$	2,951,316
	Financial assets at fair value through
	other comprehensive income
	Non-publicly traded stocks	$		71,622				-	-	71,622	71,622

(vii) Fair value of financial instruments

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

2) Valuation techniques and assumptions used in fair value

Non-derivative instruments

If a financial instrument has a quoted price in an active market, the quoted price is used as fair value. Quoted prices of major stock exchange and quoted prices of government bonds are the basis for measuring the fair value of stocks listed on an exchange, stocks listed on the OTC, and debt instruments with quoted prices in an active market.

The fair values of the Company's listed securities, and open-end funds with standard terms and conditions, and traded in active markets, were determined by the quoted market prices.

Measurements of fair value of financial instruments without an active market are based on a valuation technique or quoted price from a competitor. Fair value measured by a valuation technique can be extrapolated from similar financial instruments, the discounted cash flow method, or other valuation technique including a model using observable market data at the reporting date.

The equity instruments of the Company do not have any quoted market price. The fair value of the equity instruments is determined based on the ratio of the quoted market price of the comparative listed company and its book value per share. Also, the fair value is discounted for its lack of liquidity in the market.

3) Transfer between level 2 to level 3

The Company’s investment in equity shares of Global Corporation, with a fair value of $9,819, was classified as fair value through other comprehensive income as of December 31, 2019.

The fair value of the investment was previously categorized as Level 3 as of December 31, 2019. This was because the shares were not listed on an exchange and there were no recent observable arm's length transactions in the shares. The equity shares now has been dissolved and in the process of liquidation in 2020. The estimated receivables of the distribution of residual assets were recognized as financial assets at fair value through other comprehensive income – receivables, resulting in the fair value measurement to be transferred from Level 3 to Level 2 of the fair value hierarchy as of December 31, 2020.

There was no transfer between the fair value hierarchy levels for the year ended December 31, 2019.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

4) Movements of financial assets in level 3

				Fair value	Fair value	Fair value
			Fair value	through		other
		through profit or		comprehensive
			loss		income
	Equity investment			Equity investment
		without an active		without an active
			market		market
Balance at January 1, 2020	$		31,860			71,622
Total gains or losses
Recognized in profit (loss)			5,760		-
Recognized in other comprehensive
income (loss)			-			512
Capital reduction			-			(15,541)
Transferred to receivables			-			(457)
Balance at December 31, 2020	$		37,620			56,136
Balance at January 1, 2019	$		37,260			88,892
Total gains or losses
Recognized in profit (loss)			(5,400)		-
Recognized in other comprehensive
income (loss)			-			(17,270)
Balance at December 31, 2019	$		32,220			71,622
For the years ended December 31, 2020 and			2019, total gains and losses that were
included in “ other gains and losses” and “	unrealized gains and losses				from	financial
assets at fair value through other comprehensive			income” were as follows:
			2020		2019
Total gains and losses recognized:
In profit or loss, and presented in "other gains
and losses"			$ 5,760			(5,400)
In other comprehensive income, and
presented in “unrealized gains and losses
from financial assets at fair value through
other comprehensive income”			(5,667)			(17,270)

5) Quantified information on significant unobservable inputs (Level 3) used in fair value measurement.

The Company's financial instruments that use Level 3 inputs to measure fair value － include “ financial assets measured at fair value through profit or loss equity investments” and “financial assets measured at fair value through other comprehensive － income equity investments”.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

The Company's financial instrument that use Level 3 inputs to measure fair value was significant unobservable.

As of December 31, 2020 and 2019, quantified information of significant unobservable inputs were as follows:

			Inter-relationship
			between significant
		Significant	unobservable inputs
	Valuation	unobservable	and fair value
Items	techniques	inputs	measurement
Financial assets measured at fair value through profit or loss- equity investments without an active	Comparable listed company approach	Lack of marketability discount rate (30% on December 31, 2020 and 2019,)	The higher the lack-of- marketability discount is, the lower the fair value will be.
market
Financial assets measured at fair value through other comprehensive income -equity investments	Comparable listed company approach	Lack of marketability discount rate (30% on December 31, 2020 and 2019,)	The higher the lack-of- marketability discount is, the lower the fair value will be.
without an active
market

6) Fair value measurements in Level 3 – sensitivity analysis reasonably possible alternative assumptions

The fair value measurements of the Company's financial instruments are reasonable. However, change in the use of valuation models or variables may affect the estimations. For fair value measurements in Level 3, the information of changes in the use of valuation variable was as follows:

December 31, 2020 Financial assets at fair value through profit or loss Equity investment without an active market Financial assets at fair value through other comprehensive income Equity investment without an active market December 31, 2019 Financial assets at fair value through profit or loss Equity investment without an active market Financial assets at fair value through other comprehensive income Equity investment without an active market	Inputs Marketability discount yield to 30% Marketability discount yield to 30% Marketability discount yield to 30% Marketability discount yield to 30%	Increase (decrease) 10% $ 10% 10% $ 10%	Fair value change in profit or loss Favorable Unfavorable 5,374 (5,374) - - 4,551 (4,551) - -	Fair value change in other comprehensive income Favorable Unfavorable - - 8,019 (8,019) - - 10,232 (10,232)
			Favorable 5,374 - 4,551 -

The favorable and unfavorable effects represent the changes in fair value, and fair value is based on a variety of unobservable inputs calculated using a valuation technique.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(z) Financial risk management

(i) Overview

The Company have exposures to the following risks from its financial instruments:

1) Credit risk
2) Liquidity risk
3) Market risk

The Company's risk management objective, policies, and procedures, and the exposure risk arising from the aforementioned risks, are disclosed below. For more quantitative information, please refer to other notes of the financial statements.

(ii) Risk management framework

The board of directors has the overall responsibility for the establishment and oversight of the risk management framework.

The Company's risk management policies are established to identity and analyze the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company's activities. The Company, through its training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all employees understand their roles and obligations.

The board of directors oversees how the management complies in monitoring the Company's risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company. Internal auditors undertake both regular and ad hoc reviews of risk management controls and procedures and exception management, the results of which are reported to the board of directors.

(iii) Credit risk

The Company's credit risk is the risk of financial loss when a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from accounts receivable and bank deposit.

1) Accounts receivable and other receivables

The Company's exposure credit risk is influenced by the individual characteristics of each customer. The Company continuously monitors the information concerning client credit risk factors, such as the default risk of the industries and countries in which the customers operate.

According to the credit policy, the Company has to evaluate the credit of each new customer before setting the payment and delivery terms. The evaluations include external credit ratings, if available, and bank references. The Company reviews credit limits periodically and required customers to pay in advance when the customers' credit ratings did not meet the benchmark.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

If necessary, the Company also factors parts of accounts receivable to financial institutions without recourse to reduce the credit risk.

2) Deposits and other financial assets

The exposure to credit risk for the bank deposits and other financial instruments is measured and monitored by the Company's finance department. The Company only deals with banks with good credit rating. The Company does not expect any counterparty above fails to meet its obligations. Hence, there is no significant credit risk arising from these counterparties.

(iv) Liquidity risk

Liquidity risk is the risk that the Company is unable to meet the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company's approach to managing liquidity is to ensure, as much as possible, that it always has sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company's reputation.

As of December 31, 2020 and 2019, unused credit lines approximated to $2,020,831 and $2,035,534, respectively.

(v) Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates and interest rates, will affect the Company's income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

1) Currency risk

The Company is exposed to currency risk on sales, purchases, and borrowings that are denominated in another currency. Functional currency is TWD. The currencies used in these transactions are the TWD, USD, JPY and HKD.

Generally, borrowings and purchasing are denominated in currencies that match the cash flows generated by the underlying operations of the Company as same as USD, JPY and HKD. This provides an economic hedge without derivatives being entered into, and therefore, hedge accounting is not applied in these circumstances.

2) Interest risk

To reduce the exposure to interest rate risk, the choice of a floating interest rate or a fixed interest rate was based on the Company's evaluation of the global economic environment and the trend in market interest rates.

3) Market price risk of equity instruments

Part of the Company's equity securities are classified as financial assets measured at fair value through profit or loss and financial assets measured at fair value through other

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

comprehensive income. These assets are measured at fair value. Therefore, the Company will be exposed to the risk of changes in the value of the equity securities market.

(aa) Capital management

The Company sets its objectives for managing capital to ensure its capacity to continue to operate, to continue to provide returns to its shareholders and other related parties, and to maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Company may adjust the dividend payment and reduce the capital for redistribution to its shareholders. The Company also issues new shares or sell assets to settle any liabilities.

The Company and other entities in the similar industry use the debt-to-equity ratio in calculating. The total net debt and divided by the total capital. The net debt from the balance sheet are derived from the total liabilities, less, cash and cash equivalents. The total capital and equity include share capital, capital surplus, retained earnings, other equity and non-controlling interests, plus, net debt.

In 2020, the Company's capital management strategy is consistent with the prior year. The Company's debt-to-equity ratio at the end of the reporting period as of December 31, 2020 and 2019, were as follows:

were as follows:
December 31, 2020 Total liabilities $ 2,951,357 Less: cash and cash equivalents 303,822 Net debt 2,647,535 Total equity 6,800,733 Capital after adjustment $ 9,448,268 Debt-to-equity ratio % 28.02	December 31, 2019
	2,808,105 260,746
	2,547,359 6,841,572
	9,388,931
	% 27.13

(ab) Investing and financing activities not affecting current cash flow

Reconciliation of liabilities arising from financing activities of the Company were as follows:

January 1, 2020 Short-term borrowings $ 656,643 Short-term notes and bills payable 899,713 Lease liabilities (including current portion) 262,848 Guarantee deposit received (including other payables $1,374 ) 4,010 Total liabilities from financing activities $ 1,823,214	Cash flows 193,407 (6,185) (15,796) 1,630 173,056	Non-cash changes Amortized interest - 6,237 - - 6,237	December 31, 2020
			850,050 899,765 247,052 5,640
			2,002,507

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

Short-term borrowings Short-term notes and bills payable Lease liabilities (including current portion) Guarantee deposit received (including other payables $404 ) Total liabilities from financing activities	January 1, 2019 $ 598,013 899,736 278,416 3,199 $ 1,779,364	Cash flows 58,630 (6,864) (15,568) 811 37,009	Non-cash changes Amortized interest - 6,841 - - 6,841	December 31, 2019
				656,643 899,713 262,848 4,010
				1,823,214

(7) Related-party transactions:
(a) Parent company and ultimate controlling company

The Company is the ultimate controlling party of the Company and its subsidiaries.

(b) Names and relationship with related parties

The followings are subsidiaries and other related parties that have had transactions with the Company during the periods covered in the financial statements:

Name of related party First Copper Technology Co., Ltd. Hua Ho Engineering Co., Ltd. National Ship Demolition Co., Ltd. Taiwan Times Co., Ltd. Mei Da Co., Ltd.	Relationship with the Company
	Subsidiary of the Company Subsidiary of the Company Controlled by key management personnel of the Company (Note) Controlled by key management personnel of the Company (Note) Controlled by key management personnel of the Company (Note)

(Note) Summarized as other related parties.

(c) Significant transactions with related parties
(i) Operating revenues

The amounts of significant sales by the Company to related party was as follows:

2020 Subsidiary $ 35,026	2019
	46,531

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

When the Company sells to its subsidiaries, the prices of those sales could not be compared to those of the third-parties customers. The prices of other sales were not significant different from third-parties customers. The credit terms with other customers are from one to three months, which were not significantly different from other customers.

(ii) Purchases and cost of construction

The amounts of significant purchases and costs of construction by the Company from related parties were as follows:

2020 Subsidiaries $ 32,286 Other related parties 13 $ 32,299	2019
	55,555 9
	55,564

The Company's engineering expenditures and purchase prices of raw materials from the Company's subsidiaries are available for comparison, except that some products belong to single purchase manufacture and have no other non-related parties, the other purchase prices are not significantly different from those of non-related parties. For purchases from other related parties, the purchase prices are not significantly different from the similar purchase prices of other non-related parties. The prices of other purchases were not significantly different from third-parties suppliers. The payment terms with other suppliers are from one to three months.

(iii) Receivables from Related parties

The receivables from related parties were as follows:

Account Relationship Accounts receivable Subsidiary	December 31, 2020 $ 10,921	December 31, 2019
		7,803

Accounts receivable from related parties were uncollateralized, and no expected credit loss were required after the assessment by the management.

(iv) Payables to related parties

The payables to related parties are as follows:

Account	Relationship	December 31, 2020 $ 17,317 2 $ 17,319	December 31, 2019
Accounts payable	Subsidiaries Other related parties		51,416 105
			51,521

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(v) Property transactions

The price for purchase transportation equipment from related parties are as follow:

2020 Subsidiary $ 55 The price for sale machinery equipment from related parties are as follow: 2020 Subsidiary $ 77	2019
	-
	2019
	-

(vi) Management services

The Company provide the administrative assistance service to its subsidiaries and charge the apportionable management service costs of subsidiaries are as follows:

2020 Subsidiaries $ 20,640	2019
	20,640

The above-mentioned apportionable management service fee is reported in the statements of comprehensive income as a deduction of operating expenses.

As of December 31, 2020 and 2019, the receivables from above transaction were settled in full.

(vii) Others

Rental income is from office premises leased to other related parties. The above rental income was collected monthly or in advance. The price is decided by using the nearby office rental rates and negotiated each other. Rental incomes in 2020 and 2019 were both $1,460, and were included in other income in the statements of comprehensive income. As of December 31, 2020 and 2019, the receivables from above transaction were settled in full.

The amounts of advertising expense incurred by other related parties amounted to $100 and $104 in 2020 and 2019, respectively, which were included in operating expenses in statements of comprehensive income.

(d) Key management personnel compensation

Key management personnel compensation comprised:

2020 Short-term employee benefits $ 14,047 Post-employment benefits 383 Termination benefits - Other long-term benefits - Share-based payments - $ 14,430	2019
	14,153 335 - - -
	14,488

(8) Pledged assets: None.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(9) Commitments and contingencies:

Major commitments and contingencies were as follows:

(i) Unrecognized contingencies of contracts:

Acquisition of property, plant and equipment

(ii) Unused standby letters of credit:

Purchase of material

December 31, 2020 $ 33,225 December 31, 2020 $ 597,979	December 31, 2019
	30,834
	December 31, 2019
	264,814

(10) Losses due to major disasters: None.

(11) Subsequent Events: None.

(12) Other:

The employee benefits, depreciation, and amortization expenses, categorized by function, were as follows:

By function By item	2020	2020	2020	2019	2019	2019
	Operating costs	Operating expenses	Total	Operating costs	Operating expenses	Total
Employee benefits Salary and wages Labor and health insurance Pension Remuneration of directors Other personnel costs Depreciation Amortization	205,635 21,726 9,778 - 10,355 93,787 -	49,845 6,249 3,284 3,255 7,043 3,158 -	255,480 27,975 13,062 3,255 17,398 96,945 -	197,208 21,326 10,523 - 10,314 91,317 -	48,052 6,203 3,448 4,258 7,170 3,122 -	245,260 27,529 13,971 4,258 17,484 94,439 -

The additional information of number of employees and employee benefits in the years of 2020 and 2019 was as follows:

Numbers of employees Numbers of non-employee directors Average employee benefits Average employee salary Adjustment of average employee salary Remuneration to supervisors

	2020		2019
		450		448
		5		5
$		705		687
$		574		554
		% 3.70
	-		-

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

The Company's salary and remuneration policy (including directors, supervisors' managers and employees) are as follows:

The remuneration to employees mainly includes salary (basic salary, meal allowance, special workplace allowance, etc.) year-end bonus, performance bonus, etc.
(i) The Company draw up the salary standards for employees based on market salary level, its operating conditions and organization structure. Furthermore, the salary will be properly adjusted which depending on the market salary dynamics, changes in the overall economic and business conditions and government regulations.
(ii) The remuneration to employees is based on their education, professional knowledge and technique skills, experience and personal performance, without distinction of age, sex, race, religion, political inclination, marital status and union.
(iii) The starting salary of the inexperience complied with the government regulations.
(iv) In accordance with the Articles of incorporation, the Company should contribute no less than 3% of the profit as employee remuneration when there is profit for the year. However, if the Company has accumulated deficits, the profit should be reserved to offset the deficit.
The managers’ remuneration including salary, addition pay, severance pay, various bonus, allowances, etc., is based on the business strategies and profitability of the Company, personal performance and contribution, as well as market salary level. Moreover, in accordance with the Articles of incorporation, the Company should contribute no less than 3% of the profit as employee remuneration when there is profit for the year. However, if the Company has accumulated deficits, the profit should be reserved to offset the deficit.
The directors’ remuneration received a monthly transportation allowance, as well as salary, various bonus, etc. Moreover, in accordance with the Articles of incorporation, the Company should contribute a maximum of 2% as directors' remuneration when there is profit for the year. However, if the Company has accumulated deficits, the profit should be reserved to offset the deficit.

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(13) Other disclosures

(a) Information on significant transactions:

The following is the information on significant transactions required by the “ the Regulations” for the Company for the years ended December 31, 2020.

(i) Loans to other parties: None.
(ii) Guarantees and endorsements for other parties: None.
(iii) Securities held as of December 31, 2020 (excluding investment in subsidiaries, associates and joint ventures):

Name of holder	Category and name of security	Relationship with the Company	Account title		Ending balance	Ending balance		Note
				Units (shares)	Carrying value	Percentage of ownership (%)	Fair value
The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company The Company	China Ecotek Corporation stock Wafer Works Corporation stock Raydium Semi-conductor Corporation stock Asia Pacific Telecom Co., Ltd. stock Savior Lifetec Corporation stock Bionime Corporation stock Co-Tech Development Corp. stock Pixon Technologies Corporation stock Liyu Technology Co., Ltd. stock International United Technology Co., Ltd. stock Pack & Proper Co., Ltd. stock United Electronics Industrial Co., Ltd. stock Taiwan Sugar Corporation stock Taiwan Submarine Cable Corporation stock	The Company is a director of the investee The Company is a director of the investee - The Company is a director of the investee The Company is a director of the investee The Company is a director of the investee The Company is a director of the investee The Company is a director of the investee - The Company is a director of the investee The Company is a director of the investee - - -	Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Current financial assets at fair value through profit or loss Non-current financial assets at fair value through profit or loss Non-current financial assets at fair value through profit or loss Non-current financial assets at fair value through profit or loss Non-current financial assets at fair value through profit or loss Non-current financial assets at fair value through profit or loss Non-current financial assets at fair value through profit or loss Non-current financial assets at fair value through comprehensive income Non-current financial assets at fair value through comprehensive income Non-current financial assets at fair value through comprehensive income Non-current financial assets at fair value through comprehensive income Non-current financial assets at fair value through comprehensive income	11,843,730 4,493,217 2,470,000 89,087,877 4,335,750 7,807,900 7,812,375 3,811,200 4,500,000 987,354 2,466,288 1,712,676 457,087 30,000	412,162 192,310 346,121 899,787 150,234 530,156 416,400 99,091 37,620 7,820 8,040 13,290 26,766 220	% 9.57 % 0.88 % 3.69 % 2.33 % 1.45 % 12.64 % 3.09 % 19.96 % 7.73 % 6.04 % 4.78 % 2.77 % 0.01 % 6.67	412,162 192,310 346,121 899,787 150,234 530,156 416,400 99,091 37,620 7,820 8,040 13,290 26,766 220

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(iv) Individual securities acquired or disposed of with accumulated amount exceeding the lower of NT$300 million or 20% of the capital stock: None.
(v) Acquisition of individual real estate with amount exceeding the lower of NT$300 million or 20% of the capital stock: None.
(vi) Disposal of individual real estate with amount exceeding the lower of NT$300 million or 20% of the capital stock: None.

(vii) Related-party transactions for purchases and sales with amounts exceeding the lower of NT$100 million or 20% of the capital stock: None.

(viii) Receivables from related parties with amounts exceeding the lower of NT$100 million or 20% of the capital stock: None.

(ix) Trading in derivative instruments: None.

(b) Information on investees(excluding information on investees in Mainland China)

The following is the information on investees for the year 2020 :

Name of investor	Name of investee	Location	Main business and products	Original investment amount	Original investment amount	Balance as of December 31, 2019	Balance as of December 31, 2019	Balance as of December 31, 2019	Net income (losses) of investee	Share of profits /losses of investee	Note
				December 31, 2020	December 31, 2019	Shares	Percentage of ownership	Carrying value
The Company	First Copper Technology Co., Ltd.	Kaohsiung	Manufacturing of copper plate	1,401,129	1,401,129	141,818,196	% 39.44	575,143	79,210	(23,050)	Subsidiary Company
The Company	Hua Ho Engineering Co., Ltd.	Kaohsiung	Cable engineering	17,195	17,195	1,726,000	% 49.31	16,615	127	63	Subsidiary Company
The Company	Chung-Tai Technology Development Engineering Corporation	New Taipei City	Telecommunication engineering	92,000	92,000	2,300,000	% 23.00	11,617	(4,450)	(1,059)	The Company exercises significant influence

(Continued)

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(d) Major shareholders:

Major shareholders:
Shareholding Shareholder’s Name	Shares	Percentage
First Copper Technology	208,569,277	% 32.96
Hua Hong Investment Co., Ltd.	36,944,000	% 5.83

Note: (1) The information on major shareholders, which is provided by the Taiwan Depository & Clearing Corporation, summarized the shareholders who held over 5% of the total nonphysical common stocks and preferred stocks (including treasury stocks) on the last business date of each quarter. The registered nonphysical stocks may be different from the capital stocks disclosed in the financial statement due to different calculations basis.
Note: (2) If the aforementioned data contained shares which were kept in trust by the shareholders, the data disclosed will be deemed as the settlor’s separate account for the fund set by the trustee. As for the shareholder who reports its share equity as an insider and whose shareholding ratio is greater than 10% in accordance with Securities and Exchange Act and include its self-owned shares and trusted shares, as well as the shares of the individuals who have power to decide how to allocate the trust assets. For the information on reported share equity of the insider, please refer to the Market Observation Post System.

(14) Segment information:

Please refer to the consolidated financial statements for the years ended December 31, 2020.

(Continued)

HUA ENG WIRE & CABLE CO., LTD.

Statement of cash and cash equivalents

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item Cash on hands Cash in banks	Description Amount Petty cash $ 200 Demand deposit New Taiwan Dollars 298,916 Foreign currency (USD 146,748.11, Exchange rate 28.48) 4,179 Checking deposits 527 Subtotal 303,622 Total $ 303,822

HUA ENG WIRE & CABLE CO., LTD.

Statement of changes in current financial assets at fair value through profit or loss

For the year ended December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Name of financial instrument	Description	Shares or units	Par value(in dollars)	Total amount	Interest rate	Acquisition cost	Fair value		Fair value change is attributable to the change in credit risk Note
							Unit price (in dollars)	Total amount
Publicly traded stocks: China Ecotek Corporation Wafer Worls Corporation Non-Publicly trade stocks: Raydium semi-conductor Corporation	stock stock stock	11,843,730 4,493,217 2,470,000	$ 10 10 10	118,437 44,932 24,700	- - -	366,018 112,860	34.8 42.80 140.13	412,162 192,310	- - - - - - -
						$ 478,878		$ 604,472
						$ 196,567		$ 346,121

HUA ENG WIRE & CABLE CO., LTD.

Statement of notes receivable

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Customer Non-related parties: Customer H Customer E Customer J Customer Q Customer F Others (The amount of individual vendor in others does not exceed 5% of the account balance) Total	Description Operating Operating Lease Operating Operating Operating	Amount Note $ 3,751 - 2,356 - 1,344 - 945 - 684 - 441 - $ 9,521

HUA ENG WIRE & CABLE CO., LTD.

Statement of accounts receivable

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Customer Accounts Receivable-Non-Related Parties Customer I Customer K Customer L Others (The amount of individual vendor in others does not exceed 5% of the account balance) Total Related Parties: First Copper Technology Co., LTD.	Description Operating Operating Operating Operating Operating	Amount Note $ 382,656 - 58,000 - 41,964 247,155 - $ 729,775 $ 10,921 -

HUA ENG WIRE & CABLE CO., LTD.

Statement of other receivables

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item Other receivables Refundable deposits Total	Description others Performance security and warranty for operating	Amount Note $ 2,119 - 1,007 - $ 3,126

HUA ENG WIRE & CABLE CO., LTD.

Statement of inventories

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item Finished goods Less: Loss allowance Subtotal Work in process Less: Loss allowance Subtotal Raw materials and supplies Less: Loss allowance Subtotal Merchandise Less: Loss allowance Subtotal Inventory in transit Less: Loss allowance Subtotal Total	Amount Cost Net realizable Value Note $ 687,746 (7,143) 680,603 785,427 Note 1 387,390 (3,206) 384,184 599,067 Note 1 194,136 (3,329) 190,807 204,187 Note 1 33,946 - 33,946 34,448 Note 1 222,737 - 222,737 222,827 Note 1 $ 1,512,277
	Cost $ 687,746 (7,143) 680,603 387,390 (3,206) 384,184 194,136 (3,329) 190,807 33,946 - 33,946 222,737 - 222,737 $ 1,512,277

Note 1: For the determination of net realizable value, please refer to note 4(g).

HUA ENG WIRE & CABLE CO., LTD.

Statement of other current assets

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item Contract assets Other current assets: Refundable tax Prepaid expenses Others Total	Description Construction contract revenue Refundable tax Prepaid property insurance, bank fees, office rental and technical remuneration Prepayments for imported raw materials and office supplies	Amount Note $ 68,990 - 4,283 - 3,289 - 561 - $ 8,133

HUA ENG WIRE & CABLE CO., LTD.

Statement of changes in non-current financial assets measured at fair value

through profit or loss

For the year ended December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Name of Financial instrument	Beginning Balance	Beginning Balance	Addition	Addition	Decrease	Decrease	Ending Balance	Ending Balance	Collateral Note
	Shares or units	Fair value	Shares or units	Amount	Shares or units	Amount	Shares or units	Fair value
Publicly trade stocks Asia Pacific Telecom Co., Ltd.stock Bionme Corporation stock Co-Tech Development Corp. stock Savior Lifetee Corporation stock Non-publicly trade stocks Pixon Technologies Corporation stock Liyu Technology Co., Ltd stock Total	89,087,877 7,812,375 4,335,750 7,807,900 3,811,200 4,500,000	$ 1,023,496 332,417 95,170 628,536 111,706 31,860	- - - - - -	- 83,983 55,064 - - 5,760	- - - - - -	123,709 - - 98,380 12,615 -	89,087,877 7,812,375 4,335,750 7,807,900 3,811,200 4,500,000	899,787 416,400 150,234 530,156 99,091 37,620	- - - - - - - - - - - -
		$ 2,223,185		144,807		234,704		2,133,288

HUA ENG WIRE & CABLE CO., LTD.

Statement of changes in non-current financial assets measured at fair value

through other comprehensive income For the year ended December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Name of investee	Beginning Balance	Beginning Balance	Addition	Addition	Decrease	Decrease	Ending Balance	Ending Balance	Collateral Note
	Shares or units	Fair value	Shares or units	Amount	Shares or units	Amount	Shares or units	Fair value
Non-publicly trade stocks Taiwan Sugar Corporation International United Technology Co.,Ltd. Pack & Proper Co., Ltd Taiwan Submarine Cable Corporation Global Corporation Liquidation receivables of Global Corporation United Electronics Industrial Co., Ltd. Total	457,087 987,354 2,466,288 30,000 2,102,512 - 1,615,732	$ 26,692 6,368 19,040 300 9,819 - 9,403	- - - - - 97,909 96,944	74 1,452 - - 6,179 (note 1) 2,839 (note 3) 3,887 14,431	- - - - 2,102,512 - -	- - 11,000 80 15,998 (note 2) - - 27,078	457,087 987,354 2,466,288 30,000 - 97,909 1,712,676	26,766 7,820 8,040 220 - 2,839 13,290	- - - - - - - - - - - - - -
		$ 71,622						58,975

Note 1: The valuation adjustment on financial assets at fair value.

Note 2: The investee conducted the capital reduction and resolved be liquidated. It distributed of reduction shares amounted to $15,541, and the remaining $457 was recognized in receivables.

Note 3: The increased amount comprises the receivables deriving from the liquidation of Global Corporation amounted to $457, and which resulted in the valuation adjustment on financial assets at fair value amounted to

$2,382.

HUA ENG WIRE & CABLE CO., LTD.

Statement of changes in investments accounted for using the equity method

For the year ended December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Name of investee	Beginning	Balance	Addition	Addition	Decrease	Decrease	Ending Balance	Ending Balance		Market Value or	Net Assets Value	Collateral Note
	Shares	Amount	Shares	Amount	Shares	Amount	Shares	Percentage of ownership % 39.44 % 49.31 % 23	Amount	Unit price (in dollars)	Total amount
First Copper Technology Co., Ltd. Hua Ho Engineering Co., Ltd. Chung-Tai Technology Development Engineering Corporation	141,818,196 1,726,000 2,300,000	$ 540,029 16,501 12,676	- - -	58,164 114 -	- - -	23,050 - 1,059	141,818,196 1,726,000 2,300,000		575,143 16,615 11,617	26.2 9.63 5.05	3,715,637 16,615 11,617	- - - - - -
		$ 569,206		58,278		24,109			603,375

Note 1: The increase was due to the Company's cash dividends measured using the equity method and capital surplus, which were received and recognized by the investee as the net defined benefit plan and unrealized benefit of financial assets, respectively.

Note 2: The increase was due to the investment gain, recognized as the net defined benefit plan of the investee, that was remeasured using the equity method.

Note 3: The decrease was due to the investment loss that was measured using the equity method.

HUA ENG WIRE & CABLE CO., LTD.

Statement of changes in property, plant and equipment

For the year ended December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

For movements on property, plant and equipment, please refer to note 6(i).

Statement of changes in accumulated depreciation of property, plant and equipment

For movements on accmulated depreciation of property, plant and eduipment , please refer to note 6(i). The depreciation methods and useful lives. please refer to note 4(k).

Statement of changes in right-of-use assets

For movements on right-use assets, please refer to note 6(j).

HUA ENG WIRE & CABLE CO., LTD.

Statement of changes in accumulated depreciation of

right-of-use assets

For the year ended December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

For movements on accumulated depreciation of right-of-use assets, please refer to note 6(j).

Statement of changes in investment property

For movements on investment property, please refer to note 6(k).

The Company measures its investment using the cost model, For related accounting policy, please refer to note 4(j).

Statement of changes in accumulated depreciation of

investment property

For movements on accmulated derciation of investment property, please refer to note 6(k).

Fro depreciation methods and useful lives. please refer to note 4(j).

HUA ENG WIRE & CABLE CO., LTD.

Statement of deferred tax assets

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item	Description		Amount	Note
Deferred tax assets	Recognition of income tax due to	$	29,129	-
	temporary differences and tax losses
	Statement of other non-current financial	assets

Item Other non-current assets-other Refundable deposits	Description Furnishings and prepaid machine equipment parking and rental deposit	Amount Note $ 8,875 - $ 349 -

HUA ENG WIRE & CABLE CO., LTD.

Statement of short-term borrowings

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Type of Loan Description Letters of credit Financial institution borrowing Unsecured loans Financial institution borrowing Total	Amount $ 140,050 710,000 $ 850,050	Contract Period Within 1 year Within 1 year	Range of Annual Interest Rates (%) 0.97% 0.9%-0.97%	Loan Commitments Note Note	Collateral Note None - None -

Note: Loan commitment of short-term borrowings amounted to $4,903,520.

HUA ENG WIRE & CABLE CO., LTD.

Statement of short-term notes and bills payable

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item Commercial paper payable Commercial paper payable Commercial paper payable Commercial paper payable Commercial paper payable	Guarantee or acceptance Institution China Bills Finance Corporation- Kaohsiung Branch Mega Bills Finance Corporation- Kaohsiung Branch Taiwan Cooperative Bills Finance Corporation-Kaohsiung branch International Bills Finance Corporation-Kaohsiung branch Grand Bills Finance Corporation- Kaohsiung branch	Contract Period within 1 year within 1 year within 1 year within 1 year within 1 year	Range of interest rate 0.948% 0.948% 0.948% 0.95% 0.948%		Amount	Carrying Amount Note 299,941 - 299,869 - 99,985 - 99,987 - 99,983 - 899,765
				Total Amount $ 300,000 300,000 100,000 100,000 100,000 $ 900,000	Unamortized Amount 59 131 15 13 17 235

HUA ENG WIRE & CABLE CO., LTD.

Statement of notes payable

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item Non-related parties Bureau of Labor Insurance, Ministry of Labor National Health Insurance Administration Shareholders Others (The amount of individual vendor in others does not exceed 5% of the account balance) Total	Description Labor insurance fee Health insurance fee Cash dividends Operating	Amount Note $ 2,935 - 1,335 - 425 - 505 - $ 5,200

HUA ENG WIRE & CABLE CO., LTD.

Statement of accounts payable

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item Non-related parties A Company C Company D Company Others (The amount of individual vendor in others does not exceed 5% of the account balance) Total Related parties Hua Ho Engineering Co., Ltd. Others (The amount of individual vendor in others does not exceed 5% of the account balance) Total	Description Operating Operating Operating Operating payment and engineering payment and advertising	Amount Note $ 98,347 - 16,211 - 25,140 - 109,827 - $ 249,525 $ 16,846 - 473 - $ 17,319

HUA ENG WIRE & CABLE CO., LTD.

Statement of other payables

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item
Bonus payable
Payroll payable
Remuneration to
employees and directors
Compensated absences
liabilities
Dividends payable
Utility expense payable
Other
Total

Description
Amount
Employee bonus and supervisor allowance payable
$ 34,376
Employee salary in December 2020
15,438
Remuneration to employees and directors
13,685
Employee paid leave bonus payable
13,813
Dividends and overdue dividends payable
29,177
Utilities and fuel payable
6,198
Freight, housing tax, labor and health insurance, service
expense, pension and interest payable
10,027
$
122,714

HUA ENG WIRE & CABLE CO., LTD.

Statement of other current liabilities

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item Contract liabilities: Other current liabilities: Advanced receipts Provision Temporary receipts Total	Description Advance receipt Construction contract expenditure Advance rent receipts Short-term provision of onerous contract Overpayment from customers	Amount Note $ 8,956 - 2,292 - $ 11,248 $ 3,407 - 559 - 42 - $ 4,008

HUA ENG WIRE & CABLE CO., LTD.

Statement of deferred income tax liabilities

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item Deferred income tax liabilities	Description Recognition of income tax due to temporary differences	Amount Note $ 521,417 -

Other non-current liabilities

Item Net defined benefit liabilities Guarantee deposits received	Description Estimated net defined benefit liabilities Rent guarantee deposits received	Amount Note $ 18,793 - $ 4,266 -

HUA ENG WIRE & CABLE CO., LTD.

Statement of lease liabilities

December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item Description Lease liability Rent of Renwu's plant land	Lease term 1994/11/1`～`2034/10/31	Discount Rate 1.4651%	Ending Balance Note $ 247,052 -

(including current portion)

HUA ENG WIRE & CABLE CO., LTD.

Statement of operating revenues

For the year ended December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item Oxygen free copper wire Communication Cable Power Cable Optical fiber cable Scrap copper Others Sales Construction revenue Processing revenue Total	Quantity (kg) 8,853,384.50 519,189.35 12,525,354.43 421,954.15 1,107,280 1,100,347.05	Amount Note $ 1,686,066 - 120,347 - 2,589,852 - 168,816 - 191,620 - 361,020 - 5,117,721 Note 87,580 - 6,429 - $ 5,211,730

Note: The amount is net of sales returns and allowances, $30,988 and $2,081, respectively.

HUA ENG WIRE & CABLE CO., LTD.

Statement of operating costs

For the year ended December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item Cost of self-made products sold: Raw material Beginning balance of raw materials Raw materials purchased Raw materials sold Ending balance of raw materials Materials Beginning balance of materials Materials purchased Materials sold Ending balance of materials Less: Construction used Direct labor Manufacturing expenses Total manufacturing cost Add: Beginning balance of work in process Transferred from Merchandise Less: Ending balance of working in process Cost of finished goods Add: Beginning balance of finished goods Gains of physical count Less: Ending balance of finished goods Cost of Purchase merchandise Beginning balance of merchandise Merchandise purchased Ending balance of merchandise Add: others Add: Unallocated production overheads Cost of raw materials sold Less: Revenue from scrap sold Reversal of write-downs Gains on physical count Construction cost Total Operating cost	Amount	Amount
	Subtotal Total 3,487,946 $ 164,352 3,823,493 319,909 179,990 103,177 14,529 102,801 2 14,146 5 204,295 183,038 3,978,456 409,214 4,538 387,390 4,004,818 614,827 309 687,746 3,932,208 458,045 55,785 434,407 33,946 1,799 79,880 319,911 9,961 2,923 309 77,719 $ 4,854,570	Total
		3,487,946 103,177 204,295 183,038
		3,978,456 409,214 4,538 387,390 4,004,818 614,827 309 687,746
		3,932,208 458,045 79,880 319,911 9,961 2,923 309 77,719

HUA ENG WIRE & CABLE CO., LTD.

Statement of operating expenses

For the year ended December 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Item Salary Freight Insurance Other operating expenses Total	Description Salary and bonus Freight for product sales Employee labor and health insurance and property insurance (Note)	Amount Note $ 52,233 - 9,959 - 6,426 - 42,422 - $ 111,040

Note: The amount of individual item in others does not exceed 5% of account balance.

HUA ENG WIRE & CABLE CO., LTD.

Statement of non-operating income and expenses For the year ended December 31, 2020 (Expressed in thousands of New Taiwan Dollars)

For statement of non-operating income and expenses, please refer to note 6(x).

AI assistant

HE — Annual Report 2020

51878_rns_2020-11-10_e29b759a-aeab-43c2-aacc-599aad7804e4.pdf

Table of contents

Independent Auditors’ Report

Opinion

Basis for Opinion

Key Audit Matters

Valuation of inventory

Description of key audit matter:

Responsibilities of Management and Those Charged with Governance for the Financial Statements

Auditors’ Responsibilities for the Audit of the Financial Statements

Notes to Readers

(English Translation of Financial Statements Originally Issued in Chinese) HUA ENG WIRE & CABLE CO., LTD.

Balance Sheets

December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

(English Translation of Financial Statements Originally Issued in Chinese) HUA ENG WIRE & CABLE CO., LTD.

Statements of Comprehensive Income

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars, Except for Earnings Per Common Share)

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese) HUA ENG WIRE & CABLE CO., LTD.

Statements of Changes in Equity

For the years ended December 31, 2020 and 2019

(English Translation of Financial Statements Originally Issued in Chinese) HUA ENG WIRE & CABLE CO., LTD.

Statements of Cash Flows

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

(English Translation of Financial Statements Originally Issued in Chinese) HUA ENG WIRE & CABLE CO., LTD.

Notes to the Financial Statements

For the years ended December 31, 2020 and 2019

(1) Company history:

(2) Approval date and procedures of the financial statements:

(3) New standards, amendments and interpretations adopted:

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(4) Summary of significant accounting policies:

(a) Statement of compliance

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(ii) Functional and presentation currency

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(e) Cash and cash equivalents

(f) Financial instruments

(i) Financial assets

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

2) Equity instrument

3) Financial liabilities

4) Derecognition of financial liabilities

(g) Inventories

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(i)

Investment in subsidiaries

(j) Investment property

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(k) Property, plant and equipment

(ii) Subsequent expenditure

(l) Lease

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(m) Impairment of non-financial assets

(n) Provisions

Provision for onerous contracts

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(o) Revenue

1) Sale of goods

2) Construction contracts

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(ii) Contract costs

2) Costs to fulfil a contract

HUA ENG WIRE & CABLE CO., LTD. Notes to the Financial Statements

(p) Employee benefits

(i) Defined contribution plans

(ii) Defined benefit plans

(iii) Short-term employee benefits

(q) Income taxes

HE Annual Report 2020