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HG Annual Report 2021

Nov 11, 2021

52182_rns_2021-11-11_94572908-3bd1-4eee-ae23-84c03790bdd5.pdf

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Holiday Garden International Ltd. and subsidiaries Consolidated Financial Report and Independent Accountant’s Report

2021 and 2020 (Stock code: 2702)

Address: Rm. B, 23F., No.6, Sihwei 3rd Rd., Lingya Dist., Kaohsiung City 802701, Taiwan R.O.C. Phone: (07) 241-0123

The independent auditors’ report and the accompanying consolidated 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 consolidated financial statements, the Chinese version shall prevail. 

~1~

Holiday Garden International Ltd. and Subsidiaries

Consolidated Financial Report and Independent Accountant’s Report of 2021 and 2020 Contents

Item

1. Cover
2. Contents
3. Representation Letter
4. Independent Auditors’ Report
5. Consolidated Balance Sheets
6. Consolidated Statements of Comprehensive Income
7. Consolidated Statements of Changes in Equity
8. Consolidated Cash Flow Statements
9. Notes to the Consolidated Financial Statements
(1) Company milestones and scope of business
(2) Date and procedure of approval of the financial report
(3) Applicability of newly issued and revised standards and interpretations
(4) Summary of significant accounting policies
(5) Critical accounting judgments, estimates and key sources of assumption
uncertainty
(6) Details of significant accounts
(7) Transactions with related parties
(8) Collateralized assets		 Page

1
2-3
4
5-11
12-13
14-15
16
17-18
19-56
19
19
19-21
21-30
30
30-60
60
60		 
~2~

Item Page

(9)Significant
contingent
liabilities		 and unrecognized contractual
commitments 60-63
(10) Significant casualty losses 63
(11) Major events after the reporting period 63
(12) Others 63-70
(13) Additional disclosure 70
a. Information about major transactions
b. Information on reinvestment business
c. Mainland Investment Information
d. Major Shareholder Information
(14) Segment information 70-73 
~3~

Holiday Garden International Ltd. and subsidiaries

Declaration of Consolidated Financial Statements of Affiliated Enterprises

According to Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises, enterprises to be included in the Company's consolidated financial statements for affiliated enterprises are also the enterprises to be included into the consolidated financial statements of parent and subsidiary companies in accordance with IFRS 10. Moreover, because information disclosed in the consolidated financial statements of affiliated enterprises has already been disclosed in the previous consolidated financial statements of parent and subsidiary, the Company does not need to prepare the consolidated financial statements for the affiliated enterprises separately.

Hereby certify

Holiday Garden International Ltd.

Chen Hai-ni

March 24 ,2022 

~4~

Independent Accountants’ Report

Holiday Garden Hotel Co., Ltd.

Opinion

We have audited the following financial statements of Holiday Garden International Ltd. and the subsidiaries (the “Group”): the consolidated balance sheets of December 31, 2020 and 2021, the consolidated statements of comprehensive income of January 1 to December 31 of 2020 and 2021, the consolidated statements of changes in equity, the consolidated statements of cash flows, and the notes to consolidated financial statements, including a summary of significant accounting policies.

According to the opinion of the accountant all material respects, the consolidated financial statements have been prepared in accordance with the Financial Reporting Standards for Securities Issuers and the International Financial Reporting Standards approved by the 、 Financial Supervisory Commission, International Accounting Standards Interpretation and interpretation announcement preparation, it is sufficient to fairly express the consolidated financial position of Holiday Garden Group in 2011 and December 31, 2010. The consolidated financial performance and consolidated cash flow from Jan. 1 to Dec. 31, 2011 and 2010.

Basis for opinion

We conducted the audit in accordance with the Rules Governing Auditing and Certification of Financial Statements by Certified Public Accountants and the generally accepted auditing standards in the Republic of China. Our responsibilities under those rules and standards are described in the section of the responsibilities of accountants auditing consolidated financial statements. Personnel of our accounting firm subject to the independent requirements have complied with the code of professional ethics of certified public accountants of the Republic of China, stayed fully independent of the Group and fulfilled other responsibilities in accordance with the code. We believe that we have obtained adequate and appropriate audit evidence to form the basis of our audit opinion. 

~5~

Key audit matters

According to our professional judgment, in the 2021 consolidated financial statements of the Group. These matters have been addressed during the audit of the overall consolidated financial statements and in the formation of our opinion. We do not express our opinion on these matters separately.

We determine the following key audit matters of the consolidated financial statements of 2021 of the Group:

Business Mergers and Acquisitions

Description

Holiday Garden Group purchased SpringHill Suites by Marriott San Jose Fremont Hotel on December 9, 2021 at a price of NT$1,156,684,000. The business combination of Holiday Garden Group adopts the accounting treatment of the acquisition method. Please refer to Note 4 (26) to the consolidated financial statements for relevant explanations. To measure and allocate the acquisition price to the acquired identifiable assets of the acquired company, please refer to Note VI (26) Business Combination Description to the Consolidated Statements.

As the allocation of the purchase price involves important estimates by the management and the amount of mergers and acquisitions in this year is significant, the accountant listed corporate mergers and acquisitions as one of the important items for review this year.

Corresponding audit program

We have implemented the following audit program corresponding to the aforementioned audit matter.

  1. We have learned to understand and evaluated management’s operating procedure for the intra-group transactions, verified the document of the board and the business plan approved by the Board of Directors.

  2. We examined the M&A Process Agreement, verified the payment instrument and confirmed the acquisition price. 

~6~

3. We obtained the purchase price allocation of the mergers and acquisitions to estimate the independence of the external specialist, verified the price estimation and assumptions of the report, and evaluate the rationality of the purchase price allocations.

Property, plant and equipment and intangible asset impairment assessment

Description

For accounting policies of intangible asset impairment, please refer to Note 4(16) of the consolidated financial statements. For accounting estimation and assumption uncertainty of evaluation of intangible investment impairment, please refer to Note 5(2) of the consolidated financial statements. For intangible assets, please refer to Note 6(7) of the consolidated financial statements.

The carrying amount of intangible assets as of December 31, 2021 of the Group is NT$4,750,825,000, accounting for 55% of the total amount of the total consolidated assets. Due to the abundance of various types of accommodation hotels in recent years, fierce competition in the hotel industry, and the impact of the novel coronavirus pneumonia epidemic, the management identified signs that the real estate, plant and equipment and intangible assets of some subsidiaries may have been impaired. The company uses estimated future cash flows and discounts using an appropriate discount rate to measure the recoverable amount of these assets as a basis for assessing whether there is impairment. As the aforementioned estimation of future cash flow involves a number of assumptions, which may have a significant impact on the measurement of the recoverable amount, the accountant listed property, plant and equipment and the assessment of impairment of intangible assets as one of the important items in this year's audit.

Corresponding audit program

We have implemented the following audit program corresponding to the aforementioned audit matter.

  1. We have learned to understand and evaluate management's operating procedure for 
~7~

estimating the subsidiaries’ future cash flows and verified that their cash flows for the next year that is consistent with the approval by the Board of Directors.

  1. Assess the reasonableness of key assumptions used by management to estimate future cash flows.

  2. Evaluate the rationality of various parameters and discount rates used in calculating the recoverable amount.

Other matters: Parent company only financial report

The Group has prepared the 2021 and 2020 parent company only financial statements, and we have issued an audit report with unmodified opinion. That report is available for reference.

Responsibilities of management and those charged with governance for the consolidated financial statements

The responsibilities of management is to prepare appropriately stated consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the International Financial Standards (IFRs), the international Accounting Standards (IASs), and the related interpretations and interpretative bulletins endorsed by the Financial Supervisory Commission of the Republic of China. Management is also responsible for maintaining necessary internal control relevant to the preparation of the consolidated financial statements to ensure that the consolidated financial statements are free from material misstatement by fraud or error.

Management when preparing consolidated financial statements is also responsible for evaluating the Group’s ability to continue as a going concern, disclosing relevant matters, and using the going concern basis of accounting unless management intends to liquidate the Group, to cease the operations, or to liquidate or to have no feasible alternatives but to do so.

Those charged with governance (including the supervisors) of Group are responsible for supervising the Group’s financial reporting procedure. 

~8~

Account's responsibilities for the audit of consolidated financial statements

The objectives of the accountants for auditing the consolidated financial statements are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from any material misstatement due to fraud or errors and to issue an accountant’s report accordingly. Reasonable assurance refers to a high level of assurance, but there is no guarantee that an audit performed in accordance with the generally accepted auditing standards of the Republic of China can detect any material misstatement from the consolidated financial statements. Misstatements may arise from fraud or errors. A misstated dollar amount, individually or in the aggregate, that could be reasonable predicted to influence the economic decision of the user of the consolidated financial statements can be viewed as material.

In accordance with the generally accepted auditing standards of the Republic of China, we exercised professional judgment and maintained professional skepticism throughout the audit. We also performed the following tasks:

  1. We identified and assessed the risks of material misstatement of the consolidated financial statements, whether due to fraud or errors, designed and performed audit procedures according to those risks, and obtained audit evidence that can sufficiently and appropriately form the 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.

  2. We obtained an understanding of internal control relevant to the audit in order to design audit procedures suitable for the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.

  3. We evaluated the appropriateness of accounting policies adopted and the reasonableness of accounting estimates and related disclosures made by management.

  4. We concluded on the appropriateness of management’s use of the going concern basis of 

~9~

accounting and whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern based on the audit evidence we have obtained. If we conclude that a material uncertainty exists, we will need to draw attention in our accountant’s report to the related disclosures in the consolidated financial statements or to modify our opinion if such disclosures are inadequate. Our conclusions are based on the audit evidence obtained up to the date of this accountant’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.

  1. We evaluated the overall presentation, structure and content of the consolidated financial statements, including the attached notes, and whether the consolidated financial statements represent the underlying transactions and events in a fair manner.

  2. We obtained sufficient and appropriate audit evidence regarding the financial information of entities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision, and performance of group audits and are responsible for our audit opinion.

We have communicated with those charged with governance regarding the planned scope and the timing of the audit as well as material audit findings (including significant internal control shortcomings identified in the audit).

We have also provided those charged with governance the statement that the personnel of our accounting firm subject to the requirements of independence have complied with the requirements of independence of the code of professional ethics of certified public accountants of the Republic of China and communicate with those charged with governance relationships and other matters that may influence our independence (including related preventive measures).

We determined the key audit matters of the consolidated financial statements of 2021 of Group according to matters communicated with those charged with governance. We 

~10~

described these matters in the accountant’s report, unless the laws and regulations prohibit such disclosure or under rare condition that we decide not to communicate a given matter because the negative impact from such communication may override its public benefits under reasonable assumption.

PwC Taiwan

Accountants

Wang Guo Hua Lin Yong Zhi

Former Ministry of Finance Securities and Futures Commission

Approval certificate No.: (87)Taiwan Financial Certificate (6) No.68790

Financial Supervisory Commission R.O.C.(Taiwan) Approval certificate No.: Chin Kuan Cheng Shen Tzu No. 1050029592

March 24, 2022 

~11~

Holiday Garden International Ltd. and Subsidiaries Consolidated Balance Sheet

December 31 of 2021 and 2020

December 31 of 2021 and 2020
Unit: NT$1,000
D e c e m b e r 3 1 2 0 2 1 D e c e m b e r 3 1 2 0 2 0
Assets Notes Amount % Amount %
Current assets
1100 Cash and cash equivalents 6(1) $ 2,145,257 25 $ 887,011 13
1136 Financial assets available-for-sale - 6(1)&8
current 966,700 11 973,505 14
1150 Net notes receivable 6(2) 323 - - -
1170 Net accounts receivable 6(2) 30,980 - 24,727 -
1200 Other accounts receivable 567 - 823 -
1220 Tax assets 42,817 - 69,938 1
130X Inventories 6(3) 638 - 1,029 -
1410 Advance payments 10,053 - 10,987 -
1479 Other current assets - others 430 - 194 -
11XX Total current assets 3,197,765 37 1,968,214 28
Non-current assets
1535 Financial assets at amortized cost - 6(1) 8&9
non-current 85,295 1 - -
1600 Property, plants, and equipment 6(4)(7)及(8) 4,001,582 47 3,947,433 56
1755 Right if use asset 6(5) 113,107 1 112,412 2
1780 Intangible assets 6(6) 791,315 9 664,991 9
1840 Deferred tax assets 6(24) 395,715 5 317,815 5
1915 Prepayments for equipment 12,160 - 11,663 -
1920 Guarantee deposits paid 10,266 - 10,040 -
1990 Other non-current assets - others 229 - 192 -
15XX Total non-current assets 5,409,669 63 5,064,546 72
1XXX Total assets $ 8,607,434 100 $ 7,032,760 100

(Next page) 

~12~

Holiday Garden International Ltd. and Subsidiaries Consolidated Balance Sheet

December 31 of 2021 and 2020

Unit: NT$1,000 Unit: NT$1,000 Unit: NT$1,000
D e c e m b e r 3 1 2 0 2 1 D e c e m b e r 3 1 2 0 2 0
Liabilities and equity Notes Amount % Amount %
Current liabilities
2100 Short-term borrowings 6(9)(8) $ 884,000 10 $ 1,609,599 23
2110 Short-term notes and bills payable 6(10) 30,000 - 130,000 2
2130 Contractual liabilities - current 6(17) 3,719 - 11,090 -
2170 Accounts payable 1,814 - 3,712 -
2200 Other accounts payable 6(11) 91,647 1 67,336 1
2230 Current income tax liabilities 36,704 1 18,949 -
2280 Current lease liabilities 8,236 - 6,451 -
2320 Long-term liabilities - current portion 6(12)&8 807,943 10 718,775 10
2399 Other current liabilities: others 567 - 3,000 -
21XX Total current liabilities 1,864,630 22 2,568,912 36
Non-current liabilities
2540 Long-term borrowings 6(12)&8 3,683,724 43 2,997,564 43
2570 Deferred income tax liabilities 6(24) 187,149 2 262,719 4
2580 Lease obligations-non-current 113,552 1 113,282 1
2610 Long-term notes & accounts payable 6(4) - - 127,577 2
2645 Deposits received 181 - 755 -
25XX Total non-current liabilities 3,984,606 46 3,501,897 50
2XXX Total liabilities 5,849,236 68 6,070,809 86
Equity
Consolidated net income attributable
to owners of the parent company
Capital stock 6(14)
3110 Common share capital 1,104,856 13 1,104,856 16
Capital surplus 6(15)
3200 Capital surplus 2,169 - 2,169 -
Retained surplus 6(16)
3310 Legal reserve 82,561 1 82,561 1
3320 Special reserve - - 71,161 1
3350 Retained earnings 1,714,643 20 182,800 2
Other equity
3400 Other equity ( 146,031) ( 2) ( 115,996) ( 2)
31XX Total income attributable to the
owners of the parent company 2,758,198 32 961,951 14
3XXX Total equity 2,758,198 32 961,951 14
Significant contingent liabilities and 9
unrecognized contractual commitments
3X2X Major events after the reporting
period $ 8,607,434 100 $ 7,032,760 100 
Please refer to notes of consolidated financial statements provided at the end, which is part of this consolidated
financial report.

Chairperson of the Board: Chen Hai-niManager: Chen Hai-ni
~13~

Accounting Director: Yu Su-Ling

Holiday Garden International Ltd. and Subsidiaries Consolidated Statements of Comprehensive Income January 1 to December 31 of 2021 and 2020

Item Unit: NT$1,000
(Except earnings (loss) per share, which is in NT$1.00)
2
0
2
1
2
0
2
0
Notes
Amount
%
Amount
%
6(17)
$ 821,146
100
$ 658,854
100
6(3)(22)(23)
(
193,414)(
23)(
189,651)(
29)
627,732
77
469,203
71
6(6)(22)(23)
(
733,330 ) (
89) (
645,973) (
98)
12(2)
(
266)
-
220
-
(
733,064)(
89)(
646,193)(
98)
105,332
12
176,990
27
6(18)
3,397
-
15,983
3
6(19)
11,769
2
6,798
1
6(20)
(
40,766 ) (
5)
(
185,452) ( 28 )
6(21)
(
113,184)(
14)(
130,239)(
20)
(
138,784)(
17)
292,910
44
(
244,116 )
29
(
469,900
71
6(24)
(
90,185)(
11)(
218,519)(
33)
153,931
18
251,381
38
6(8)&12(2)
1,980,213
241
18,928
3
( $ 1,826,282 ) ( 223)
$ 270,309
41
( $ 37,544 ) (
5)
$ 71,256
11
6(24)
7,509
1
(
14,251)(
2)
( $ 30,035 ) (
4)
$ 57,005
9
( $ 1,796,247 ) ( 219)
$ 327,314
50
( $ 1,826,282 ) ( 223)
$ 270,309
41
( $ 1,796,247 ) ( 219)
$ 327,314
50
6(24)
($ 1.39)
($ 2.28)
4000
Operating revenue
5000
Operating cost
5900
Operating gross profit
Operating expenses
6200
Management expense
6450
Expected impairment loss
6000
Total operating expenses
6900
Operating profit
Non-operating income and expenses
7100
Interest Income
7010
Other income
7020
Other gains and losses
7050
Financial cost
7000
Total non-operating income and expenses
7900
Net profit before tax
7950
Income tax expense
8000
Net loss of continuing business units
for the current period
8100
Profits (losses) of closed units
8200
Net profit (losses) for this year
Other comprehensive income
Components may be subsequently
reclassified to profit/loss
8361
Exchange differences on translation of
foreign financial statements
8399
Income tax of components that may be
reclassified
8300
Net amount other comprehensive income
(loss) after tax
8500
Total comprehensive income (loss)
Net income attributable to
8610
Owners of the parent company
Total comprehensive income (loss)
attributable to:
8710
Owners of the parent company
Earnings (loss) per share
9710
Net loss from continuing business units

Please refer to notes of consolidated financial statements provided at the end, which is part of the consolidated financial statements. 。 

Chairperson of the Board: Chen Hai-ni Manager: Chen Hai-ni

Accounting Director : Yu Su-
ling

~14~

Holiday Garden International Ltd. and Subsidiaries Consolidated Statements of Comprehensive Income January 1 to December 31 of 2021 and 2020

Unit: NT$1,000

(Except earnings (loss) per share, which is in NT$1.00)
9720
Net profit (net loss) of discontinued units
9750
Basic earnings per share (loss
$ 9810
Net loss from continuing business units
($ 9820
Net profit (net loss) of discontinued units
9850
Diluted earnings (loss) per share
$		 17.92
(

16.53
($
1.39)
($ 17.92
(

16.53
($		 0.17)

2.45)

2.28)
0.17)

2.45)

Please refer to notes of consolidated financial statements provided at the end, which is part of the consolidated financial statements. 。 

Chairperson of the Board: Chen Hai-ni Manager: Chen Hai-ni

Accounting Director : Yu Su-
ling

~15~

Unit: NT$1,000

Holiday Garden International Ltd. and Subsidiaries Consolidated Statements of Changes in Equity January 1 to December 31 of 2021 and 2020

2020
Balance on January 1, 2020
Current net profit
Other comprehensive income for this year
Total current comprehensive income
Balance, December 31, 2020
2021
Balance on January 1, 2021
Net profit for the current period
Other comprehensive income for this year
Total comprehensive profit and loss for the
current period
Special surplus reserve reversal
Balance on December 31, 2021		 Notes Ordinary
share
capital		 Capital
Reserve–
Issue
Premium		 R e t a i n e d
e a		 R e t a i n e d
e a		 r n i n g s Exchange
differences
On financial
Statements of
Foreign
operating
agencies
Total
$ 58,991- $ 1,289,265
- (
270,309)
(
57,005 ) (
57,005)
(
57,005 ) (
327,314)
(
$ 115,996))
$ 961,951
(
$ 115,996))
$ 961,951
-
1,826,282
(
30,035))(
30,035 )
(
30,035))(
1,796,247 )
-
-
(
$ 146,031))
$ 2,758,198
Statutory
Surplus
Reserve		 Special
Surplus
Reserve		 Undistributed
Surplus
(with
offsetting
Losses)
6(16) $ 1,104,856
-
-
-
$ 1,104,856
$ 1,104,856
-
-
-
-
$ 1,104,856		 $ 2,169-
-
-
-
$ 2,169
$ 2,169
-
-
-
-
$ 2,169		 $ 82,561
-
-
-
$ 82,561
$ 82,561
-
-
-
-
$ 82,561		 $ 71,161
-
-
-
$ 71,161
$ 71,161
-
-
-
(
71,161 )
$ --		 $ 87,509
(
270,309)
-
(
270,309)
($ 182,800)
($ 182,800)
1,826,282
-
1,826,282
71,161
$ 1,714,643		 
Please refer to notes of consolidated financial statements provided at the end, which is part of the consolidated financial statements.

Manager: Chen Hai-ni

Chairperson of the Board: Chen Hai-ni

Accounting Director: Yu
Su-ling

16

Holiday Garden International Ltd. and Subsidiaries

Consolidated Cash Flow Statements January 1 to December 31 of 2021 and 2020

Unit: NT$1,000
Cash flows from operating activities
Net loss before tax of continuing business units
Net profit before tax (net loss) of discontinued units

Net profit before tax (net loss) for the current period
Adjust item
Income expense item
Expected credit impairment (benefits) losses

Depreciation expense

Amortized expense

Lease modification benefits

Interest expenses

Interest income

Disposal of property, plant and equipment
interests

Impairment losses on non-financial assets

Changes in assets/liabilities related to operating activities
Net change in assets related to operating activities
Bills receivable
Accounts Receivable
Other receivables
Inventory
Prepayments
Other current assets - other
Net change in liabilities related to operating activities
Contract liabilities - current
Bills payable
Accounts Payable
Other payables
Other current liabilities - other
Cash inflows (outflows) from operations
Interest received
Interest paid
Income tax refunded
Income tax paid
Net cash outflow from operating activities
Cash flow from investing activities
Financial assets at amortized cost –
decrease in current
Financial assets at amortized cost –
non-current increase
Acquisition of business

Acquisition of property, plant and equipment

Disposal of property, plant and equipment
Acquire intangible assets

Increase in prepaid equipment
Increased margin deposit
Other non-current assets - other (increase) decrease
Net cash inflows (outflows) from
investing activities
Cash flow from financing activities
Short-term borrowing increases

Short-term borrowings decrease

Short-term notes payable decreased

Lease principal repayment

Long-term loan

Repay long-term loan

Decreased deposits
Net cash inflow from financing activities		 Note
(
6(8)
12(2)
(
6(4)(5)(22)
6(6)(22)
6(5)(20)
(
6(21)
6(18)
(
6(20)
(
6(7)(20)

(
(
(

(
(
(
(
(

(
(
6(26)
(
6(27)
(
(
6(6)
(
(
(

(
6(28)
6(28)
(
6(28)
(
6(28)

6(28)
6(28)

(		 2021
2020

$ 244,116 ) ( $ 469,900)

2,036,842(
23,960)
1,792,726 (
493,860)



808 )
667
198,045
210,080
48,365
49,923

14 ) (
16)
125,260
140,215

3,397 ) (
15,983)

2,052,593 )
-
2,083
132,975



323 )
1,438

6,090 )
7,928
190 (
355)
391
67
717 (
2,157)

236 )
98


7,351 ) (
7,084)
- (
322)

1,898 )
692
21,295 (
36,839)

2,431)
346
113,931 (
12,187)
3,445
18,716

124,392 ) (
142,425)
22,777
5,187

97,749)
-

81,988 ) (
131,009)
$ 5,789 $ 25,481

85,295 )
-

1,156,684 )
-

132,454 ) (
3,464)

2,700,376 )
-

708 )
-

12,305 ) (
105,227)

423 ) (
2,111)

43)
11
1,318,253(
85,310)

2,274,401
1,791,099

3,000,000 ) (
1,711,500)

100,000 )
-
(
6,470 ) (
4,730 )
1,589,281
1,060,660
(
699,777 )(
1,125,967)

574 ) (
615 )
56,861
8,947		 
Please refer to notes of consolidated financial statements provided at the end, which is part of the consolidated financial
statements.

Chairperson of the Board: Chen Hai-ni
Manager: Chen Hai-ni
Accounting Director: Yu Su-ling

~17~

Holiday Garden International Ltd. and Subsidiaries Consolidated Cash Flow Statements January 1 to December 31 of 2021 and 2020

Effects of Exchange Rate Changes
Increase (decrease) in cash and cash equivalents
in the current period
Cash and cash equivalents at end of period

Closing balance of cash and cash equivalents
 Note
6(1)
6(1)		 ( 
Please refer to notes of consolidated financial statements provided at the end, which is part of the consolidated financial
statements.

Chairperson of the Board: Chen Hai-ni
Manager: Chen Hai-ni
Accounting Director: Yu Su-ling

~18~

Holiday Garden International Ltd. and subsidiaries Notes for Consolidated Financial Statements

2021 and 2020

(Unless otherwise noted)

1. Company milestones

  • (1) Holiday Garden International Ltd. (the “Company”) was established in July 1959, and the primary scope of business operation includes tourism hotels and attached restaurants and swimming pools. The Company has been a Taiwan Stock Exchange Corporation (TSEC) listed company since February, 1965.

  • (2) For information of the primary business operations activities of the Company and the subsidiaries (the Group), please refer to Note 4(3).

2. Date and procedure of approval of the financial report

This consolidated financial report has been approved and issued by the Board of Directors on March 24, 2022.

3. Applicability of newly issued and revised standards and interpretations

  • (1) Impacts from adopting the latest, amended and revised International Financial Reporting Standards (IFRS) approved by the Financial Supervisory Commission (ROC)

The following table summarizes the latest, amended and revised IFRS standards and interpretations applicable for 2021 approved by the Financial Supervisory Commission:

Effective date of issuance by International Accounting Standards Newly issued/revised/amended standards and interpretations Board

Amendments to IFRS 4 "The temporary waiver is an extension of IFRS 9"[January 1, 2021 ] Stage 2 Amendments to IFRS 9, IFRS 39, IFRS 7, IFRS 4 and IFRS 16 January 1, 2021 「 Interest Rate Indicator Changes 」 Amendments to IFRS 16 「 COVID-19 related rent concessions after 30 April 1, 2021 June 2021 」

Note: The Financial Supervisory Commission allows it to be applied in advance on January 1, 2010

Except the following matters, the Group has determined that the standards and interpretations above have no material effect on the Group’s financial conditions and performance. 

~19~

(2) The impact of not yet adopting the newly issued or revised IFRS approved

by the FSC

The following table summarizes the newly issued, revised and revised standards and interpretations of the International Financial Reporting Standards approved by the FSC:

Effective date of issuance by International

Accounting Newly issued/revised/amended standards and interpretations Standards Board

Amendments to IFRS 3 「 Index to Conceptual Framework 」 January 1, 2022 Amendments to IAS 16 「 Property, plant and equipment; the price before reaching the intended state of us 」 January 1, 2022 *Amendments to IAS 37 「 Amendments to IAS 37 」 January 1, 2022 * Annual Improvements in the 2018~2020 Cycle January 1, 2022

The Group has determined that the standards and interpretations above has no material impact on the Group’s financial conditions and performance.

(3) Impact of International Financial Reporting Standards issued by the

International Accounting Standards Board but not yet endorsed by the FSC

The following table summarizes the new publications, amendments and revisions to the IFRS that have been issued by the IASB but have not yet been incorporated into the FRS-approved standards and interpretations:

Effective date of issuance by International Accounting Newly issued/revised/amended standards and interpretations Standards Board

  • Amendments to IFRS 10 and IAS 28 「 Sales or contributions

of assets between investors and their affiliates or joint ventures 」 To be announced * IFRS 17 「 Insurance Contracts 」 January 1, 2023 * Amendments to IFRS 17 「 Contracts of Insurance 」 January 1, 2023 * Amendments to IFRS 17 「 First use of IFRS 17 and January 1, 2023 IFRS 9 - Comparative information 」

  • Amendments to IAS 1 「 Current or non-current classification January 1, 2023 of liabilities 」 
~20~

  • Amendment to IAS 1 「 Disclosure of Accounting Policies 」 January 1, 2023

  • Amendments to IAS 8 「 Definition of Accounting Estimates 」 January 1, 2023

  • Amendments to IAS 12 「 Deferred income tax relating to

  • assets and liabilities arising from a single transaction 」 January 1, 2023

The Group has determined that the standards and interpretations above has no material impact on the Group’s financial conditions and performance

4.Summary of significant accounting policies

The major accounting policies adopted for preparing these consolidated financial reports are described below. Unless otherwise specified, these policies are consistently applied in the entire period reported.

(1) Statement of compliance

This consolidated financial report is prepared in accordance with IFRS and IAS approved by the Financial Supervisory Commission and the related interpretations, and interpretative bulletins (IFRSs).

(2) Basis of preparation

  • 1.The consolidated financial statements have been prepared on the historical cost basis except for financial instruments that are measured at fair value.

  • 2.To prepare for financial reports in accordance with IFRSs, some important accounting estimations are required. When applying the Group’s accounting policies, management also needs to make judgment, which involves accounts of a high level of decision-making and complexity or accounts associated with material assumption and estimation. Please refer to Not 5 attached.

(3) Basis of consolidation

  • 1.Principles for consolidated financial report preparation

  • (1) The Group incorporates all subsidiaries into the entities this consolidated financial report is prepared for. Subsidiaries refer to entities controlled by the Group (including structure entities). When the Group is exposed to variable rewards from participating in that entity or entitled to rights to said variable rewards and the Company has the power and ability to affect said rewards of that entity, the Group controls said entity. The subsidiaries are included into the consolidated financial report since the day the Group acquire their control and the consolidation ends on the day their control is lost.

  • (2) The transactions, balance, and unrealized profit or loss generated between the subsidiaries of the Group had been eliminated. Necessary adjustment of accounting policies of the subsidiaries has been made to be consistent with policies of the Group. 

~21~

  • (3) Profit or loss and other comprehensive income components are attributable to owners of the parent company and non-controlling interests. Comprehensive income is also attributable to owners of the parent company and noncontrolling interests, even if this results in the non-controlling interests having a deficit balance.

  • (4) If changes in the shareholding of a subsidiary do not lead to losing the control (transactions with non-controlling interests), they will be treated as equity transactions, i.e., transactions between shareholders. The difference between adjustment of non-controlling interests and the fair value of the consideration paid or received is directly recognized in equity.

  • (5) When the Group loses its control over a subsidiary, the remaining investment of the previous subsidiary should be re-measured at the fair value and be treated as the fair value of the initially recognized financial asset or the cost of initially recognized invested associates or joint ventures. The difference between the fair value and the carrying amount is recognized in profit or loss. For all amounts of a subsidiary previously recognized in other comprehensive income, the accounting treatment is based on the same principle as if the Group directly disposes the related assets or liabilities. That is, if the amount is previously recognized as a profit or loss of other comprehensive income, it should be reclassified as income when the related assets or liabilities are disposed. Moreover, when the Company losses the control over the subsidiary, such profit or loss shall be reclassified into income from equity.

  • Subsidiaries included in the consolidated financial report:

Investor
Holiday Garden Hotel Co.,
Ltd.
HOLIDAY GARDEN
INTERNATIONAL LTD.
HOLIDAY GARDEN U.S.		 Subsidiary
HOLIDAY GARDEN
INTERNATIONAL LTD.
HOLIDAY GARDEN
INTERNATIONAL LTD
HOLIDAY GARDEN U.S.
HOLIDAY GARDEN SF CORP.
HOLIDAY GARDEN SN CORP.
HOLIDAY GARDEN NW CORP.
HOLIDAY GARDEN VC CORP.
HOLIDAY GARDEN WC CORP.
HOLIDAY GARDEN EV
CORP.		 Business scope
Investment
business
Hotel operations
Investment
business
Hotel operations
Hotel operations
Hotel operations
Hotel operations
Hotel operations
Hotel
operations		 % shareholding

December 31, 2021
100
100
100
100
100
100
100
100
100
December 31, 2020
100
100
100
100
100
100
100
100
-
Description
Note

Note ： Holiday Garden EV CORP. was founded at the first season of 2019 。

  • 。

    1. Subsidiaries not included in the consolidated financial report: None

  • 。

    1. Adjustment and treatment of different accounting period of subsidiaries: None

  • Significant restriction: None 

~22~

  1. Subsidiaries of non-controlling interests significant to the Group: None

  2. (4) Foreign currency translation

  3. Accounts listed in the financial report of each entity of the Group are based on the money (i.e., functional currency) of the primary economic environment where the entity operates. This consolidated financial report is presented in New Taiwanese Dollars (NT$), which is the Company’s functional and presentation currency.

  4. 1.Foreign currency transaction and balance

  5. (1) For foreign currency transactions, spot rate of exchange on the trading day or the measurement date is used for functional currency translation, and the resulting exchange differences are recognized in current profit or loss.

  6. (2) Foreign currency monetary assets and liabilities balance is adjusted based on the spot exchange rate on the balance sheet date, and the resulting exchange differences are recognized in profit or loss.

  7. (3) Foreign currency monetary assets and liabilities balance is measured at fair value through profit or loss and adjusted using the spot exchange rate on the balance sheet. The resulting exchange differences are recognized in profit or loss. For foreign currency monetary assets and liabilities balance that is measured at fair value through other comprehensive income, it is adjusted using the spot exchange rate on the balance sheet day. The resulting exchange differences are recognized in the account of other comprehensive income. As for those not measured at fair value, they are measured at the historical exchange rate on the initial transaction day.

  8. (4) All exchange gains or losses are recognized in “other gains and losses” in the statement of comprehensive income.

  9. 2.Translation of foreign financial statements

  10. (1) All the group entities that have a functional currency different from the presentation currency are translated into the presentation currency as follows: A.The assets and liabilities of each balance sheet presented are translated at the closing rate of that balance; ；

    • B.The income and expense of each statement of comprehensive income are translated using the current average exchange rate, and

    • C.Exchange differences generated from translation are recognized in other comprehensive income.

  11. (2) When a foreign operation is partially disposed of or sold, it will be recognized in the accumulated exchange differences of other comprehensive income and reclassified to the non-controlling interests of that specific foreign operation. However, when the Company loses the control of a foreign operation subsidiary, even if the Company still keeps 

~23~

partial equity of the former subsidiary, it is treated as disposing all equity of the foreign operation.

  • (5) Classification of current and non-current assets and liabilities

  • 1.Assets that meet one of the following criteria are classified as current assets:

    • (1) Assets expected to be realized in the normal operating cycle or intended to be sold or consumed,

    • (2) Liabilities held primarily for transaction purposes.

    • (3) Assets expected to be realized within 12 months after the balance sheet date;

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

    • The Group classifies all assets not meeting the above asset criteria as non-current assets.

  • 2.Liabilities that meet one of the following criteria are classified as current liabilities:

    • (1) Liabilities expected to be paid off in the normal operating cycle;

    • (2) Liabilities held primarily for transaction purposes.

    • (3) Liabilities that are to be paid off within 12 months after the balance sheet date.

    • (4) Liabilities for which the repayment date cannot be extended unconditionally to more than 12 months after the balance sheet date. Classification of liabilities for which, at the option of the counterparty, repayment is required for the issue of equity instruments is not affected.

    • The Group classifies all liabilities that do not meet the above criteria as noncurrent.

(6) Cash equivalents

Cash equivalents refer to short-term, highly liquid investments, which can be readily converted to fixed cash and has an insignificant risk of value change. Time deposits meet the above definition, and their holding satisfies short-term cash commitments for operation. Therefore, they are classified as cash equivalents.

(7) Financial assets at amortized cost

  • 1.Refers to those who meet the following conditions at the same time:

  • (1) The financial asset is held under an operating model whose purpose is to collect contractual cash flows.

  • (2) The contract terms of the financial asset generate cash flow on a specific date, which is entirely the payment of the principal and the interest on the outstanding principal amount.

  • 2.The Group uses trade day accounting for financial assets measured at fair value through profit or loss and satisfying the accounting practice.

  • 3.The Group at initial recognition uses fair value measurement. Related transaction cost is recognized in profit or loss and subsequently measured at fair value. The gain or loss is recognized in profit or loss.

  • The Group holds time deposits that do not qualify as cash equivalents. Due to 

~24~

the short holding period, the impact of discounting is not significant and is measured by the investment amount.

(8) Accounts and notes receivable

  • 1.This term refers to accounts and notes granting an unconditional right to receive consideration in exchange for transferred goods or rendered services in accordance with the contract.

  • 2.For short-term accounts receivable without interest payment, they are measured at the original invoice amount because of insignificant effect of discounting.

  • (9) Impairment loss on financial assets

The Group assesses the amortized financial assets carried out at cost based on all reasonable and evidence-supported information (including those on a prospective basis) on each balance sheet date. For financial assets exposed to significantly increasing credit risk after the initial recognition, the Company measures the loss allowance for 12-month expected credit losses. For financial assets exposed to significantly increasing credit risk since the initial recognition, the Company measures the loss allowance for the financial assets at an amount equal to the lifetime expected credit losses. For accounts receivable that do not contain a significant financing component, the Group measures the loss allowance at on amount equal to lifetime expected credit losses for trade receivable

(10) Derecognition of financial asset

The Company will derecognize a financial asset if one of the following conditions is met ：

  • 1.The contractual rights to receive cash flows from the financial asset expire.

  • 2.The contractual rights to receive cash flows from the financial asset are transferred, and almost all risks and rewards of the ownership of the financial asset has been transferred.

  • 3.The contractual rights to receive cash flows from the financial asset are transferred, and the control over the financial asset is not retained.

  • (11) Operating lease(lessor)

Payments received under operating leases, net of any incentives given to the lessees, are recognized in profit or loss on a straight-line basis over the term of the lease.

  • (12) Inventories

Inventories are stated at the lower of cost and net realizable value, and the cost is determined by the weighted average method. The item by item method is adopted to compare between the cost and the net realizable value to decide which one is lower. The net realizable value refers to the estimated sale price in the normal course of business, less relevant variable selling expenses.

(13) Property, plants, and equipment

  • 1.Property, plants, and equipment are carried at acquisition cost, and the related interests during the construction period are capitalized.

  • 2.Subsequent cost may become a carrying amount of the assets or be recognized 

~25~

as a single asset only if future economic benefits associated with this item may flow into the Group and moreover, the cost of this item can be reliably measured. The carrying amount of the replaced part should be derecognized. All other repair and maintenance expenses are recognized in profit or loss when they are incurred.

  • 3.Property, plants, and equipment are measured subsequently using the cost model. Except land, which does not depreciate, all others are depreciated by the straight-line method according to the estimated useful lives. Significant components of property, plants, and equipment should be depreciated separately.

  • 4.The Group reviews each asset’s residual value, useful life, and depreciation method at the end of each fiscal year, and if the expected residual value and useful lives are different from the previous estimation or if the expected consumption type of future economic benefits of a given asset has any material change, the stipulation on changes in accounting estimates from IAS 8 “Accounting Policies, Changes in Accounting Estimates and Errors” will adopted for treatment. The useful lives of assets are listed below ： Land improvements

2 to 39 years Buildings and structures 2 to 55 years Utility equipment 3 to 20 years Business facilities/equipment 1 to 25 years Other facilities 3 to 8 years

(14)Lease transaction of Lessee － Right-of-use asset/Lease obligations

  1. Leased assets are recognized as right-of-use assets and lease liabilities at the date they become available for use by the Group. The lease payments are recognized as an expense over the lease term using the straight-line basis when a lease contract is a short-term lease or a lease of a low-value subject asset

  2. 2.Recognized the lease obligations as the present value of incremental borrowing rate of interest which lease started. The lease benefit included fixed benefit and deducted any Incentive. Provided the interest during the lease by measuring the cost after amortization whit adopting interest method. The group will reevaluate lease obligations and adjust the right-of-use assets when the lease term or benefit changed by amending non-contract.

  3. 3.Right-of-use assets are recognized as cost at the beginning of the lease. The cost includes the original measured amount of the lease liabilities. The useful life of right-of-use assets or the expiry date of the lease term will be provided to be depreciation. The right-if-use asset will adjust any remeasurement of the lease liabilities which is reassessed.

  4. (15) Intangible assets

  5. 1.Trademark and franchising Trademark and franchising obtained separately are recognized by the 

~26~

acquisition cost. As for trademarks and franchising acquired from corporate merger, they are recognized using the fair value on the acquisition day. Trademarks and franchising are assets with finite useful lives and amortization is calculated using the straight-line method over the 15 to 22.6 years of useful lives.

2. Other intangible assets

  • For other intangible assets, they are recorded using the acquisition cost, and amortization is calculated using the straight-line method over 5 to 15 years.

(16) Non-financial asset impairments

The Group estimates the recoverable amount for assets showing impairments at the balance sheet date, and when the recoverable amount of an asset is lower than the book value, it will be recognized in impairment loss. The recoverable amount refers to the higher of fair value less costs to sell and value in use. Aside from goodwill, when an asset impairment loss recognized the year before disappears or decreases, reverse the impairment loss, but the increase to the carrying amount of the asset due to the reversal cannot exceed the said asset’s book value without impairment recognized and net of amortization or depreciation.

(17) Borrowings

It refers to proceeds from long-term and short-term bank borrowings. The Group recognizes borrowings initially at fair value, net of transaction costs incurred, and subsequently any difference between the proceeds (net of transaction costs) and the redemption value is measured at amortized cost using the effective interest method and recognized as interest expense in profit or loss during the circulating period.

(18) Accounts payable

  • 1.Refers to the debts incurred due to the purchase of raw materials, commodities or labor services on credit.

  • 2.For short-term, non-interest-bearing accounts and notes payable, they are measured at the original invoice amount because of insignificant discounting effect.

(19) Derecognization of financial liabilities

The Group will derecognize a financial liability when the contracted obligations are fulfilled, canceled, or expired.

(20) Offset of financial assets and liabilities

Financial assets and liabilities can be offset only if there is the legally enforceable right to do so and the intent is to to settle on a net basis or to realize the asset and settle the liability simultaneously, and the net amount has to be stated in the balance sheet.

(21) Employee benefits

  • 1.Short-term employee benefits

Short-term employee benefits are measured at undiscounted amount of prospective payment and are recognized as expenses when related services are rendered. 

~27~

  • 2.Pensions

    • Defined contribution plans (DCP)

    • For defined contribution plans, the contribution amounts for pension are recognized in the current pension expense when they are due on the accrual basis. Prepaid contributions are recognized as assets to the extent of refundable cash or reduction in future payment.

  • 3.Employees’ compensation and directors’ and supervisors’ remuneration Employees’ compensation and directors’ and supervisors’ remuneration are legal or constructive obligations and are recognized in expenses and liabilities when the amount can be reasonably estimated. Deviation between estimated and actual distribution amount shall be treated in accordance with changes in accounting estimates. For stock distribution as employee remunerations, the closing price of the day prior to the resolution of the Board of Directors shall be the basis for calculating the number of shares.

  • (22) Income tax

  • 1.Income tax expense includes current and deferred income tax. Income tax is recognized either in the income statement or in equity if it relates to items that are recognized in other comprehensive income or directly in equity

  • 2.The Group calculates the current income tax using tax rates enacted or substantively enacted by the balance sheet date of the country generating the taxable income from operations Management periodically evaluates the condition of income tax filing in accordance with appropriate income tax related laws and regulations and if applicable shall make tax payment to the tax authorities based on the estimated income tax liabilities. There is an additional tax of unappropriated earnings according to the Income Tax Act, and after the earning distribution is approved at the shareholders’ meeting held in the year following the year the earnings are generated, the tax expense of undistributed earnings shall be recognized based on the actual condition of earning distribution.

  • For deferred income tax, the balance sheet liability method is adopted, and it is recognized on temporary differences between the tax base of assets and liabilities and their carrying amounts in the balance sheet. Deferred income tax liabilities generated from the initial recognition of goodwill are not recognized. Moreover, deferred income tax is not recognized if it is originated from the initial recognition of assets or liabilities in transactions (business merger excluded) and neither accounting profits nor taxable income (or tax losses) is affected at the time of the transaction. For temporary differences generated from investments in subsidiaries, they are not recognized if the Group is capable of controlling the time point of reversal of the temporary differences, and the temporary differences may not be reversed in the foreseeable future. Deferred tax is determined using tax rates (and tax laws) enacted or substantively enacted by the balance sheet date, and the tax rates (and tax laws) used are the ones expected to be applicable when realizing related deferred tax assets or repaying related deferred tax liabilities.

  • Deferred tax assets are recognized to the extent when they are highly likely to be used to offset future taxable income, and unrecognized and already recognized deferred income tax assets should be re-evaluated on each balance sheet date. 

~28~

  1. Recognized current income tax assets and liabilities are offset only if there is the legally enforceable right to do so and the intent is to to settle on a net basis or to realize the asset and settle the liability simultaneously and the net amount has to be stated in the balance sheet. Deferred income tax assets and liabilities are offset only if there is the legally enforceable right to do so and the deferred income tax assets and liabilities related to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities, but each entity intend to either settle on a net basis or to realize the assets and settle the liabilities simultaneously.

  2. (23) Dividend distribution

Dividends distribution among the Company's shareholders are recognized in the financial report when the Company’s shareholders’ meeting resolved that dividend are to be paid; cash dividend distribution is recognized as liabilities, while share dividend distribution is recognized as stock dividend to be distributed and be converted to common stock on the base day of issuance of new stock.

(24) Revenue recognition

  • 1.The Group provides accommodations and foodservice related products, and the sales revenue is recognized at the time the services are rendered or products are delivered to customers.

  • 2.Sales revenue is recognized as the contractual price net of the estimated price.

  • 3.Accounts receivable is recognized at the time services are rendered or products are delivered to customers. Because at that time point the Group has the unconditional right to the contractual price, the consideration can be collected from customers after the time point.

(25) Government subsidies

  • Government grants are recognized at fair value when there is reasonable assurance that the enterprise will comply with the conditions attached to the government grant and will receive the grant. If the nature of the government grant is to compensate the expenses incurred by the Group, the government grant shall be recognized as the current profit or loss on a systematic basis d u r i n g t h e p e r i o d i n w h i c h t h e r e l e v a n t e x p e n s e s a r e i n c u r r e d .

  • (26) Business combination

    • 1.The Group uses the acquisition method for business combinations. Consolidated consideration is based on the fair value of the assets transferred, liabilities incurred or assumed and equity instruments issued, and the consideration transferred includes the fair value of any assets and liabilities arising from contingent consideration agreements. Acquisition-related costs are recognized as an expense when incurred. Identifiable assets acquired and liabilities assumed in a business combination are measured at fair value at the acquisition date. On an individual acquisition transaction basis, the Group elects to measure non-controlling interests whose components are present ownership interests and whose holders are entitled to a proportionate share of the net assets of the enterprise at the time of liquidation either at 
~29~

acquisition date fair value or at the non-controlling interest's proportionate share of the acquiree's identifiable net assets; all other components of the non-controlling interest are measured at acquisition date fair value.

  • 2.If the aggregate fair value of the transfer consideration, the non-controlling interest in the acquiree, and the interest previously held in the acquiree exceeds the fair value of the identifiable assets acquired and liabilities assumed, the difference is recognized as goodwill at the acquisition date; if the aggregate fair value of the identifiable assets acquired and liabilities assumed exceeds the aggregate fair value of the transfer consideration, the non-controlling interest in the acquiree, and the interest previously held in the acquiree, the difference is recognized in profit or loss for the current period.

  • (27) Operations department

Information from the Group's operations department and internal management reports provided to major operations decision makers are reported by a consistent approach. Major operations decision makers are responsible for distributing resources to operations department and evaluating their performance.

5.Critical accounting judgments, estimates and key sources of assumption uncertainty

When preparing this consolidated financial report, the Group's management has applied its judgment on determining the accounting policies used and made accounting estimations and assumptions based on reasonable expectation of future events according to the conditions on the balance sheet date. Accounting estimations and assumptions may be significantly different from the actual results, and therefore, experiences and other factors are continuously evaluated and adjusted. These estimations and assumptions expose the carrying amounts of assets and liabilities to the risk of material adjustment in the next fiscal year. Uncertainty of material accounting judgments, estimates, and assumptions are described below ：

(1) Material judgments adopted by accounting policies

The Group has made no critical judgments adopted by accounting policies.

(2) Material accounting estimates and assumptions

Intangible assets (excluding goodwill) impairment evaluation

In asset impairment evaluation, the Group relies on subjective judgment to determine the independent cash flows of a given asset group, service life of the asset, and possible revenue and expenses in future based on the asset use model and the characteristics of the industry. Moreover, estimated changes in economic conditions and group ‘s strategies may also lead to significant impairment in future.

6.Details of significant accounts

(1) Cash and cash equivalents

Cash:
Cash in treasury and working funds		 December 31, 2021
$ 1,098		 December 31, 2020
$ 1,667		 
~30~
Checking deposits and demand deposits
Cash equivalents:
Time deposits		 2,083,245
2,084,343
60,914
$ 2,145,257		 468,542
470,209
416,802
$ 887,011
  • 1.The Group places cash and deposits

with multiple reputable banks and financial institutions to disperse the credit risk, and therefore, the probability of occurrence of default is very low.

  • 2.The cash and cash equivalents held by the Group on December 31, 2011 and 2010 were restricted for providing pledges and were not highly liquid, and were classified as financial assets measured by amortized cost of $1,051,995 respectively. and $973,505, categorized by liquidity.

(2) Net amounts of accounts and notes receivable

Notes receivable
Less: Allowance for doubtful accounts
Accounts receivable
Less: Allowance for doubtful accounts		 December 31, 2021
$ 323
-
$ 323
$ 31,179
( 199)
$ 30,980		 December 31, 2020
$ -
-
$-
$ 25,738
( 1,011)
$ 24,727
  • 1.Aging analysis of accounts and notes receivable (including non-current assets available for sale) ：
Not past due and past due for 1 to 30 days
Past due for 31 to 90 days
Past due for more than 91 days		 December 31, 2021
$ 28,214
3,102
186
$ 31,502		 December 31, 2020
$ 18,692
6,050
996
$ 25,738

The above is the aging analysis based on past due days.

  • 2.As at December 31, 108, December 31, 107 and January 1, 107, the Group's receivables (including notes receivable) from customers were $36,200, $34,352 and $39,644, respectively.

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

  • 4.Without considering the collaterals held or other credit enhancement, the Group’s maximum amount of credit risk exposure of the most representing notes receivable for December 31, 2021 and 2020 was NT$323 and NT$0 respectively. The Group's maximum amount of credit risk exposure of the most representing accounts receivable for December 31,2021 and 2020 was NT$30,980 and NT$24,727 

~31~

respectively.

  • 5.For information related to credit risk of accounts and notes receivable, please refer to 12(2).

(3) Inventories

Foods and non-alcoholic and alcoholic beverages

December 31, 2021
Carrying amount
Cost
$ 638
Allowance for price
decline in inventories
$-

$ 638

Foods and non-alcoholic and alcoholic beverages

December 31, 2020 December 31, 2020
Carrying amount
$ 1,029

Cost
$ 1,029
Allowance for price
decline in inventories
$-

The inventory cost that the Group recognized as expenses for 2021 and 2020 was $7,919 and $13,710 respectively.

(4) Property, plants, and equipment

  1. The book value of property, plants, and equipment is presented below ：
Land
Land improvements
Buildings and structures
Utility equipment
Business facilities/equipment
Other facilities
Unfinished construction and to be inspected equipment		 December 31, 2021
$ 893,818
109,230
2,547,750
5,350
425,253
8,798
11,383
$ 4,001,582		 December 31, 2020
$ 1,313,710
59,225
2,198,603
11,990
341,333
5,344
17,228
$ 3,947,433		 
~32~

2. Changes in property, plants, and equipment in this period are as follows ：

Cost
Land
Land improvements
Buildings and structures
Utility equipment
Business facilities/equipment
Other facilities
Unfinished construction and to be
inspected equipment
Cost
Land
Land improvements
Buildings and structures
Utility equipment
Business facilities/equipment
Other facilities
Unfinished construction and to be
inspected equipment		 2021 2021 2021


Closing balance
Opening balance
$ 1,313,710
94,770
3,486,126
40,155
1,094,490
9,271
17,228
$ 6,055,750
 Current addition Acquired in
combination
$ 85,054
56,723
624,450
-
198,184
-
-		 Current reduction
Current transfer
($ 481,493) $ -
-
-
( 618,478) -
( 32,454) -
( 34,723) 16,895
( 5,319) -
-
( 5,424)
($ 1,172,467)
$ 11,471
2020		 Current transfer
Exchange rate
affected Amount

~~a~~
$ -
-
286
-
2,463
5,837
-



$ 893,818
148,779
3,411,837
7,701
1,247,551
9,789
11,383
$ , 5,730,858,

Closing balance
$ 1,313,710
94,770
3,486,126
40,155
1,094,490
9,271

17,228

$ 6,055,750




$





($ 23,453)
( 2,714)
( 80,547)
-
( 29,758)
-
421
($ 136,893)
$ 8,586
 $ 964,411
$ 11,471


2020
Opening balance


Current addition
Acquired in
a combination
$ -
-
-
-
-
-
-
$-		 Current reduction Exchange rate
affectedAmount
($ 43,831)
( 4,991)
( 149,971)
-
( 52,800)
-
( 645)		 Exchange rate
affectedAmount

$ 1,357,541
99,761
3,629,155
39,989
988,105
6,456
9,918
$ 6,130,925		 $ -
-
440
166
909
339
-		 $ -
-
-
-
( -
-
-
($ 254)
$ 1,854
($ 252,238)		 
~33~
Accumulated depreciation and
impairment
Land improvements
Buildings and structures
Utility equipment
Business facilities/equipment
Other facilities		 2021
Closing balance
$ 39,549
864,087
2,351
822,298
991
$ 1,729,276
Opening balance
Current addition
$ 5,063
63,576
1,578
121,305

762


$ 192,284		 Current reduction
$ -
( 463,078)
( 27,392)
( 30,516)
( 3,698)
($ 524,684)		 Exchange rate
affected Amount
($ 1,059)
( 23,934)
-
( 21,648)
-
($ 46,641)

$ 35,545
1,287,523
28,165
753,157
3,927

$ 2,108,317
Accumulated depreciation and
impairment
Land improvements
Buildings and structures
Utility equipment
Business facilities/equipment
Other facilities		 2020
Closing balance
$ 35,545
1,287,523
28,165
753,157
3,927

$ 2,108,317
Opening balance
Current addition
$ 5,006
216,034
3,086
111,299

593

$ 336,018
 Current reduction
$ -
-
-
-
-
$-		 Exchange rate
affected Amount
($ 1,799)
( 40,798)
-
( 34,449)
-		 Exchange rate
affected Amount

$ 32,338
1,112,287
25,079
678,307
3,334

$ ,1,851,345		 ($ 79,046) 
~34~

  • 3.In accordance with Kaohsiung Urban Development Kuei Tzu No. 10234984600 correspondence on October 28, 2013, the Group applied for making payment by installments for converting governmental land to commercial land in the land conversion urban plan, and the total amount to be paid is NT$212,628. The Group made the first installment payment of NT$85,051, and the remaining amount paid by the second and third installment payments was $63,788 and $63,789 respectively. These payments, which should be made before the applied construction permit or the new use permit is issued, were recognized in 2013 . The land was contracted for sale on July 7, 2021, and the payment of the burden was paid in September, 2021 (the balance on December 31, 2020 is listed as "long-term bills payable and payment of $127,577").

  • 4.There was no borrowing cost capitalization of the Company’s property, plants, and equipment in 2021nd 2020

  • Significant components of the Group's buildings and buildings, including buildings and decoration works, are depreciated over 39 to 55 years and 15 to 25 years respectively.

  • 6.For the information for obtaining property, plants, and equipment with acquisition method on April 4,2019, please refer to Note6(26).

  • 7.For information on using property, plants, and equipment for guarantees, please refer to Note 8.

－ (5)Lease transaction Lessee

  • 1 The subject assets leased by the Group include buildings, transportation equipment and multi-function printers, and the lease contract period ranges from 2 years to 20 years. The lease contract is negotiated individually and contains various terms and conditions. Except that the leased assets cannot be used as loan guarantees, and the sublease to a third party requires the consent of the lessor, no other restrictions are imposed.

  • The lease period of some of the buildings and official vehicles leased by the Group is not more than 12 months and the leased low-value subject assets are business equipment.

  • The changes in the Group's right-of-use assets in 2011 and 2010 are as follows:

2 0 2 1

2 0 2 1
Jan. 01
increase
depreciation (
Expenses
(
Dec. 31		 Buildings
$111,516
9,251

7,368 )

1,952 )
111,447		 Transportation
Equipment		 wealth-producing
equipment

$ 24 $
1,264
(
138 ) (
(
24 ) (
$ 1,126 $		 Total

112,412
10,515
7,844 )
1,976 )

113,107
$ 872

-
(
338)
-
$ 534 
~35~

2 0 2 0

Transportation wealth-producing

2 0
Transportation		 2 0
Transportation		 2 0
wealth-producing
Jan. 01
increase
depreciation (
Expenses
(
Dec. 31		 Buildings
Equipment
$118,253 $ -
2,813
1,013

6,824 ) (
141)

2,726 ) -
111,516 $ 872		 Equipment
equipment

Total
$ 96 $ 118,349

-

3,826
(
72 ) (
7,037 )
(
-
) (
2,726 )
$ 24 $ 112,412
$ 872

  1. The increase of the Group's right-of-use assets in 2021 and 2020 is $10,515 and$3,826, respectively.

  2. Information of loss and gains related to lease transaction as the followings:

Affected project of current loss and
gain
Lease obligation interest
$ Expense of short-term lease
Expense of leases of low-value assets
Variable lease payments:
Lease Modification Benefi
(		 2021


1,971 $ 413
85
140
14 ) (		 2020

2,017
1,037
533
-

16)

  1. The Group's total lease cash outflows in 2021 and 2020 are $9,079 and $8,317 respectively.

  2. Effect of variable lease payments on lease liability

(1) The subject of the Group's lease contract with variable lease payment terms is the one linked to the sales amount of various products at the department store counter. For the leasing of department store counter type, it is based on the payment terms of variable pricing, and is mainly related to the sales amount of various products. Lease payments that vary in relation to the sales amount of each type of product are recognised as an expense in the period in which these payment terms are triggered.

(2) If the sales of department store counters within the Group increase, the fee for variable lease payment will increase according to the operating income percentage.

  • (6)Intangible assets 
~36~
2 0 2 1

Other

Trademark
intangible
& franchising

assets

Total
Jan. 01



Cost
$ 884,104 $ 7,333 $ 891,437
Accumulated amortisation
and impairment
(
224,008 ) (
2,438 ) (
226,446 )
$ 660,096 $ 4,895, $ 664,991



Jan. 01
$ 660,096 $ 4,895, $ 664,991
Added in this
issue_separate
-
708
708
Added in this
issue_merger
192,273
-
192,273
Amortization for the
current period
(
47,921, ) (
444 (
48,365 )
Exchange rate impact
(
18,152 ) (
140 (
18,292 )
Dec. 31
$ 786,296 $ 5,019 $ 791,315
Dec. 31

Cost
$ 1,076,377 $ 8,041, $ 1,084,418
Accumulated amortisation(
290,081) (
3,022) (
293,103)
$ 786,296 $ 5,019 $ 791,315

20 20

Other

Trademark intangible
&franchising
assets

Total
Jan. 01



Cost
$ 884,104 $ 7,333 $ 891,437
Accumulated
amortisation and
impairment
(
139,106 ) (
1,667 ) (
140,773 )
$ 744,998 $ 5,666 $750,664



Jan. 01
$ 744,998 $ 5,666 $ 750,664
Amortization for the
current period
(
49,416 ) (
507 (
49,923 )
Exchange rate impact (
35,486) (
264 (
35,750)
Dec. 31
$ 660,096 $ 4,895 $ 664,991
Dec. 31

Cost
$ 884,104 $ 7,333 $891,437
Accumulated
amortisation
(
224,008) (
2,438) (
226,446)		 2 0 2 1

Detailed list of intangible asset amortization ： 

~37~

2 0 2 1 2 0 2 0 Operating expenses $ 48,365 $ 49,923

  • (7) Impairment of non-financial assets

  • The details of impairment losses recognized by the Group are as follows:

Recognized in current profit and loss

2 0 2 1 2 0 2 0 Impairment loss - $ 2,083 $ – business equipment Impairment Loss - House $ – $ 132,975 and Construction

  1. The details of the above impairment losses disclosed by sector are as follows:

Recognized in current profit and loss

Taiwan Division_Our
company
$ US Division_Holiday
Garden EV CORP.
$		 2 0 2 1

2,083 $ – $		 2 0 2 0

–
132,975
  1. In 2020, due to the impact of the novel coronavirus pneumonia epidemic, the occupancy rate of the Group decreased, resulting in impairment of houses and buildings. The Group has adjusted its carrying amount to the recoverable amount and recognized an impairment loss of $132,975 for the US business unit. The recoverable amount is the fair value of the real estate less the cost of disposal, which is assessed according to the income method, and the fair value belongs to the third level.

In 2021, the Group disposed of Liuhe Pavilion and changed its business model, resulting in impairment of business equipment. The Group has adjusted its carrying amount to the recoverable amount and recognized an impairment loss of $2,083 for the Taiwan business unit. The recoverable amount is the value in use of the business equipment. Since the impact of discounting is not significant, the Group has not discounted it. 

~38~

The cumulative impairment changes are as follows

==> picture [467 x 126] intentionally omitted <==

  • (8) Suspension of business units

  • Approved by the board of directors on May 5, 2021 and approved by the shareholders' meeting on July 6, 2021, the company intends to dispose of the real estate located at the current location of the company registration and Liuheguan operation, which meets the definition of a closed unit and is expressed as a closed unit. The transaction has been signed on July 7, 2021 in the Republic of China, and the real estate sale and purchase contract will be completed on November 26, 2021 in the Republic of China.

  • The cash flow information of discontinued units is as follows:

2021 2020
Cash flow from operating activities ( $ 13,555 ) $ 5,405
Cash flow from investing activities 2,700,376 ( 1,599 )
Cash flow from financing activities
– –
Total cash flow $ 2,686,821 $ 3,806
  • 3.An analysis of the operating results of the discontinued unit is as follows:
2021
 2020
Operating income $ 33,012 $ 82,849
Operating cost ( 19,577 ) ( 38,367)
Operating expenses ( 51,620 ) ( 66,471)
Expected credit impairment gain (loss) 542 ( 447)
Total non-operating income and expenses 14,755 ( 1,524)
Pre-tax net profit (loss) of discontinued
units		 ( 22,888 ) ( 23,960)
Income Tax (Expense) Benefit 4,577 5,032 
~39~

After-tax net profit (loss) of discontinued ( $ 18,311 ) ( $ 18,928 ) units

2021

2020
Disposal of the benefits of the discontinued unit
(before tax)		 $ 2,059,730 $ –
Income tax expense (
61,206 ) –
Disposal of the benefits of the discontinued
unit (after tax)		 $ 1,998,524 $ –

*Please refer to Note 6(19) for the government subsidy income

recognized by discontinued units.

(9) Short-term loans

The nature of the loan
The short-term bank loan
Secured loan
Credit loan
Interest rate range		 December 31, 2021
$ 884,000
-
$884,000
0.94%~0.99%		 December 31, 2020

$ 1,519,599
$ 90,000
$ 1,609,599
0.94%~1.62%

  1. For the interest expense of the Group's bank borrowings recognized in profit or loss, please refer to the explanation in Note VI (21).

  2. For the collateral for the above short-term borrowings, please refer to Note 8.

(10) S ort-term notes payable

**Dec.31, 2021 ** Dec. 31, 2020
Commercial paper payable $ 30,000 $ 130,000
Interest rate range 0.56% 0.55% ~0.90%

The above short-term bills payable are guaranteed by financial institutions such as bill companies.

(11)Other payable

Salaries payable
Tax payable
Interest payable		 December 31, 2021
$ 24,403
15,413
6,229		 December 31, 2020
$ 13,834
6,251
5,508		 
~40~
Payable for equipment
3,709
Premium payable
2,661
Management fee payable
2,130
Other
37,102
$ 91,647
(12)Long-term borrowings
Types of borrowings
Period of borrowing and
repayment method
Range of
interest rates
Long-term borrowings
from banks
Credit loan
From Sept. 18,2012 to Sept. 18,2022
interest will be paid monthly, and
from Dec. 18,2015 it will be
amortized quarterly and repaid in
28installments.
Sign
the
loan
repayment deferred contract in June
1.60%
2020, and only need to pay interest
until March 2021, and the principal
will be amortized on a quarterly basis
according to the fixed amount.
Credit loan
From Sept. 20, 2019 to Sept. 20,
2022, the principal and interest will
be repaid monthly.
1.10%
Secured loans
Notes 2 and 3
2.46%
Secured loans
Notes 2 and 4
2.75%
Secured loans
Notes 2 and 5
2.42%
Secured loans
Notes 2 and 6
-
Secured loans
Notes 2 and 7
-
Secured loans
Notes 2 and 8
2.50%
Secured loans
Notes 2 and 9
2.75%
Secured loans
Notes 2 and 10
3.05%
Secured loans
Notes 2 and 11
3.25%
Credit loan
Note 12
1.00%
ess: Current portion of long-term loans payable






$

Collaterals
None
None
Note 1
Note 1
Note 1
Note 1
Note 1
Note 1
Note 1
Note 1
Note 1
None











(

Less: Current portion of long-term loans payable 

~41~
Types of borrowings
Period of borrowing and
repayment method
Range of
interest rates
Long-term borrowings
from banks
Credit loan
From Sept. 18,2012 to Sept. 18,2022
interest will be paid monthly, and from
Dec. 18,2015 it will be amortized
quarterly and repaid in 28installments.
Sign the loan repayment deferred
contract in June 2020, and only need
to pay interest until March 2021, and
the principal will be amortized on a
quarterly basis according to the fixed
amount.
1.60%
Credit loan
From Sept. 20, 2019 to Sept. 20, 2022,
the principal and interest will be
repaid monthly.
1.10%
Secured loans
Notes 2 and 3
2.47%
Secured loans
Notes 2 and 4
2.51%
Secured loans
Notes 2 and 5
2.48%
Secured loans
Notes 2 and 6
3.05%
Secured loans
Notes 2 and 7
3.05%
Secured loans
Notes 2 and 8
2.50%
Secured loans
Notes 2 and 9
2.76%
Secured loans
Notes 2 and 10
1.00%
Less: Current portion of long-term loans payable		 Collaterals
(		 December 31, 2020
$ 20,878
11,667
374,797
530,655
367,392
34,522
587,143
1,306,662
428,882
53,741
3,716,339
718,775)
$ 2,997,564
None
None
Note 1
Note 1
Note 1
Note 1
Note 1
Note 1
Note 1
None

  • Note 1: For collaterals of the above-mentioned long-term borrowings, please refer to Note 8.

  • Note 2: For commitment to maintaining financial ratios for loans, please refer to Note 9(2).

  • Note 3 ： The loan period is 5 years, and the loan interest rate adopts floating interest rate. Since March 2017, the subsidiary will repay the principal of USD 130,000 on a fixed monthly basis. When the loan period expires in February 2021, the remaining loan amount will be repaid in one lump sum. The subsidiary has signed an extension contract in February 2020. The extension period is 1 year. The borrowing rate adopts a floating interest rate. The monthly fixed repayment of the principal is US$130,000. When the loan period expires in February 2022, the remaining loan amount will be repaid in one go. The subsidiary also signed a loan repayment deferred contract in May 2020, and only needs to pay interest until April 2021, and the principal of the deferred repayment will be repaid when the loan period expires in February 2022. 

~42~

  • Note 4 ： The loan period is 4.25 years, and the loan interest rate adopts floating interest rate. Since July 2016, the subsidiary will repay a fixed monthly principal of USD 50,946. When the loan period expires in October 2020, the remaining loan amount will be repaid in one go. The subsidiary has signed a new loan contract in March 2020 to repay the loan. The loan period is 7 years, and the loan interest rate adopts a floating interest rate. Since April 2020, the subsidiary will repay a fixed monthly principal of USD 41,944. In 2027 When the loan period expires in March, the remaining loan amount will be repaid in one lump sum. The subsidiary also signed a loan repayment deferred contract in June 2020, and only needs to pay interest until November 2020, and the deferred repayment principal will be repaid when the loan period expires. The subsidiary also signed a loan repayment deferred contract in December 2020, from January 2021 to June 2021, the monthly fixed repayment of the principal is US$11,250, and the monthly fixed repayment of the principal from July to December is US$17,750. , the principal of deferred repayment will be repaid together when the loan period expires in March 2027.

  • Note 5 ： The loan period is 3.7 years, and the loan interest rate is floating. When the loan period expires in February 2021, the remaining loan amount will be repaid in one lump sum. The subsidiary has signed an extension contract in February 2020. The extension period is 1 year. The borrowing rate adopts a floating interest rate. When the borrowing period expires in February 2022, the remaining loan amount will be repaid in one go.

  • Note 6 ： The loan period is 3.67 years, and the loan interest rate adopts floating interest rate. Since January 2018, the subsidiary will repay the principal of USD 3,029 on a fixed monthly basis. When the loan period expires in August 2021, the remaining loan amount will be repaid in one lump sum. The subsidiary also signed a loan repayment deferred contract in June 2020, and only needs to pay interest until November 2020, and the deferred repayment principal will be repaid when the loan period expires in August 2021. The subsidiary has signed a new loan contract in August 2021 to repay the loan.

  • Note 7 ： The loan period is 3.5 years, and the loan interest rate adopts floating interest rate. Since March 2018, the subsidiary will repay a fixed monthly principal of USD 51,260. When the loan period expires in August 2021, the remaining loan amount will be repaid in one lump sum. The subsidiary also signed a loan repayment deferred contract in June 2020, and only needs to pay interest until November 2020, and the deferred repayment principal will be repaid when the loan period expires. The subsidiary also signed a loan repayment deferred contract in December 2020, from January 2021 to July 2021, the monthly fixed repayment of the principal of USD 22,500, and the deferred repayment of the 

~43~

principal will be due to the expiration of the loan period in August 2021 repay together. The subsidiary has signed a new loan contract in August 2021 to repay the loan.

  • Note 8 ： The loan period is 7 years, and the loan interest rate adopts floating interest rate. Since May 2019, the subsidiary will repay the principal of USD 10,000 on a fixed monthly basis. When the loan period expires in April 2026, the remaining loan amount will be repaid in one go. The subsidiary also signed a loan repayment deferred contract in May 2020, and only needs to pay interest until April 2021. The deferred repayment principal will be repaid with a fixed monthly repayment of US dollars from May 2021. 94,887 yuan. When the loan period expires in April 2026, the remaining loan amount will be repaid in one go.

  • Note 9 ： The loan period is 5 years, and the loan interest rate adopts floating interest rate. The subsidiary will repay the principal of USD 37,862 per month on a fixed basis from July 2020. When the loan period expires in July 2025, the remaining loan amount will be repaid in one lump sum. The subsidiary also signed a loan repayment deferred contract in December 2020, from January 2021 to June 2021, the monthly fixed repayment of the principal is US$11,250, and the monthly fixed repayment of the principal from July to December is US$17,750, the principal of deferred repayment will be repaid together when the loan period expires in July 2025.

  • Note 10:The loan period is 5 years, and the loan interest rate is floating. The subsidiary will repay the principal of USD 51,934 on a fixed monthly basis from August 2021. When the loan period expires in August 2026, the remaining loan amount will be repaid in one lump sum.

  • Note 11:The loan period is 5 years, and the loan interest rate adopts floating interest rate. From December 2021, the subsidiary will repay the principal of USD 65,151 on a fixed monthly basis. When the loan period expires in December 2026, the remaining loan amount will be repaid in one lump sum.

  • Note 12:The loan period is 5 years and 2 years respectively, and the loan interest rate is fixed annual interest rate. In response to the impact of the new coronavirus pneumonia epidemic, the subsidiary will apply for a salary protection loan to the Small Business Administration (SBA) in 2021 and April 2020 respectively. The program (Paycheck Protection Program), with a total principal of $108,253 (US$3,887,000), has been transferred on April 1, 2021 and May 1, 2020, respectively.

The main conditions are as follows:

  • (1) The principal and interest do not need to be repaid until the loan exemption result is confirmed.

  • (2) According to the current U.S. Paycheck Protection Loan Program, companies can use the 24-week waiver coverage period to pay for operating expenses, and can apply to SBA for loan forgiveness within 10 months after the waiver coverage period ends. Those who qualify will receive full or partial loan forgiveness.

As of December 31, 2021, the amount of loan forgiveness that has been applied for under the U.S. Paycheck Protection Loan Program is $52,232 and is 

~44~

currently pending approval.

The Group's bank loans are recognized in the interest expense of income. Please see Note 6(21).

  • (13)Pensions

  • 1.(1)Starting from July 1, 2005, the Company and its domestic subsidiaries, in accordance with the Labor Pension Act, set up the defined contribution plan for retirement, which is applicable for employees who are the citizens of ROC. According to employee’s option for the labor pension system stipulated by the Labor Pension Act, the Group and domestic subsidiaries each month contribute to the Labor Pension Fund at the rate of 6% of employees’ monthly wages. Payments of employees pension are made to each employee’s personal pension account and employees can choose to receive the principal and the accumulated income by monthly pension payment or a lump sum pension payment.

    • (2)In accordance with the above-mentioned pension plan, the Group and domestic subsidiaries recognized a pension cost of NT$2,467 NT$2,946 in 2021 and

    • 2020 pectively.

  • 2.The subsidiaries adopt the defined contribution plan, i.e., making monthly pension contributions in accordance with local government's regulations and recognizing the contributions in expenses. In accordance with related pension plans, the subsidiaries recognized a pension cost of NT$980 and NT$631 in 2021 and 2020

  • respectively.

(14)Share capital

  1. As of December 31, 2021, the Company’s authorized capital was NT$1,500,000, and the paid-in capital was NT$1,104,856, which was divided into 110,486,000 shares, with a par value of NT$10 per share. The Company’s issued shares are fully paid-up.

beginning and the ending of the reporting period are as follow ：

January 1 (December 31) Unit：1000 of shares
2021
2020
110,486
110,486

(15)Capital surplus

In accordance with the Company Act, the capital surplus from shares issued in excess of par and donations may be used to offset a deficit, or when the company has no deficit,the capital surplus can then be distributed as cash dividends or new stock among shareholders in proportion to their original shareholdings. Moreover, according to the Securities and Exchange Act, for the above-mentioned capital 

~45~

increase by capital surplus, the total amount each year cannot exceed 10% of the paid-in capital. The Company cannot use capital surplus for capital increase unless the reserve is not enough to cover the capital losses.

(16)Retained surplus

  1. In accordance with the Company's Articles of Incorporation, if there are earnings upon the Company's final account at the end of the year, the Company shall first pay profit-seeking enterprise income tax, make up the deficits for the preceding years and then set aside a legal reserve of 10% of the reminder (not applicable if the legal reserve has reached the total capital amount of the Company). After appropriating or reversing a special reserve in accordance with laws, the balance and the unallocated accumulated earnings from the previous years are the accumulated, distributable earnings for shareholders, for which the Board of Directors shall propose an earning distribution plan to be resolved at the shareholders’ meeting. More than 10% of the aforementioned allocable earnings are provided for dividends and shareholders’ bonuses, and the cash dividends should be no less than 10% of the total amount of shareholders’ dividends and bonuses.

  2. The legal reserve cannot be used for purposes other than offsetting the company’s deficits or providing new stock or cash to shareholders in proportion to their original shareholding. If the reserve is used for distributing new stock or cash, it has to be more than 25% of the Company’s paid-in capital.

  3. 3.(1)The Company shall first set aside a special reserve from the debit balance on the “other equity” item at the balance sheet date before distributing earnings, and later when this debit balance on the “other equity” item is reversed, the reversed amount can be included in distributable earnings.

  4. (2)In accordance with Order 1010012865 issued by the Financial Supervisory Commission on April 6, 2012, for an entity adopting IFRSs the first time should set aside a special reserve. Later on, when the Company uses, disposes, or reclassifies related assets, the special reserve can be used for reversal by the proportion of the special reserve that has been set aside. If the aforementioned asset is investment property, the land part shall be reversed when it is disposed or reclassified, and for the non-land part, it shall be reversed progressively throughout the term of use.

  5. (3) Due to the disposal of the real estate of Liuhe, the Company reversed the original special surplus reserve of $71,161 to undistributed surplus.

  6. The company's 2021 and 2020 dividends recognized as distribution and owner's 

~46~

dividends are both $0. On March 24, 2022, the board of directors proposed the 2021 earnings distribution plan to distribute cash dividends of NT$1 per share and stock dividends of NT$3.5 $497,185 in dividends.

  • (17) Operating income
ng income
2021
 2020
Revenue from customer contracts $ 854,158 $ 741,703
Operating income of discontinued
units		 ( 33,012 ) ( 82,849
$ 821,146 $ 658,854
  1. Breakdown of customer contract revenue

The Group's revenue can be broken down into the following major product lines and geographic regions: 

~47~
2021

Revenue from external client contracts
Less: Operating income of
discontinued units
Income recognition time point
Revenue recognised at a point in
time
Income recognised over time
Less: Operating income of
discontinued units		 Taiwan

Other

Income

4,902
2,142 )
2,760
4,902
–

4,902
2,142 )
2,760		 $ U.S.A

Room

Revenue

781,275
–
(
781,275
–

781,275
781,275
–
(
781,275		 Total
$ 854,158

33,012 )
$ 821,146
$ 29,060
825,098
854,158

33,012 )
$ 821,146
$ ( Room

Revenue

43,823
21,472 ) (
22,351
–

43,823
43,823
21,472 ) (
22,351		 $ Food &

Beverage

Income

24,158
9,398 ) (
14,760
24,158
–

24,158
9,398 ) (
14,760		 $
$
$		 $ $ $ $ $ $
(
$
$ $ $ 
~48~
Taiwan U.S.A
Food &
Room Beverage
 Other Room
2020
 Revenue Income
 Income Revenue
 Total
Revenue from external client contracts $ 82,263 $
39,253 $		 7,322 $
612,865		 $
741,703
Less: Operating income of
discontinued units		 ( 57,650) ( 21,486) ( 3,713) –
 ( 82,849)
$ 24,613 $
17,767 $		 3,609 $
612,865		 $
658,854
Income recognition time point
Revenue recognised at a point in
time		 $
–		 $
39,253 $		 7,322 $
–
 $
46,575
Income recognised over time 82,263 612,865 695,128
– –
82,263 39,253 7,322 612,865 741,703
Less: Operating income of
discontinued ( 57,650) ( 21,486) ( 3,713) ( 82,849)
units –

The Group's operations in 2021 and 2020 were affected by the novel coronavirus pneumonia epidemic, resulting in a decrease in the Group's operating income. As of March 24, 2022, due to the impact of the follow-up control of the novel coronavirus, the amount of its impact on operating income cannot be reasonably estimated 

~49~

2. Contract liabilities

The Group recognises contract liabilities related to customer contract revenue as follows:

Dec. 31, 2021 Dec. 31, 2020 Jan. 01, 2020 Dec. 31, 2021 Dec. 31, 2020 Jan. 01, 2020 Dec. 31, 2021 Dec. 31, 2020 Jan. 01, 2020
Contract liabilities:
Contract liabilities--
Room		 $
3,012 $		 5,668 $ 13,275
Service contract
Contract liabilities--
Food
Service contract 707 5,422 5,035
$
3,719 $		 11,090 $ 18,310

Revenue recognized in the current period for contract liabilities at the beginning of the period:

2021
 2020
The opening balance of
contract liabilities is
recognized as revenue in the
current period
Room service contract $ 5,668 $ 13,275
Food service contract 5,422 5,035
$ 11,090 $ 18,310
(18) Interest income
Bank deposit interest
Interest income fom financial assets
measured at amortised cost
Other interest income
(19) Other income

Rental income
$ Government grants
Other income -other
Less: Operating income of discontinued units (		 (18) Interest income
Bank deposit interest
Interest income fom financial assets
measured at amortised cost
Other interest income
(19) Other income

Rental income
$ Government grants
Other income -other
Less: Operating income of discontinued units (		 2021
$ 869
1,853
675
$ 3,397
2021
5,935
16,762
15,903
38,600
26,831)		 2020
$ 4,073
11,910
-
$ 15,983
2020
2,050
9,142
4,335
15,527
8,729)


$
(		 $
( 
~50~

$ 11,769) $ 6,798

Due to the application of the Group's Relief and Revitalization Measures for Industries and Businesses with Operational Difficulties Affected by the Severe Special Infectious Pneumonia and the application to the Tourism Bureau of Kaohsiung City Government for the use of anti-epidemic accommodation, after review and compliance, the continuing business units will be recognized in 2021 and 2020 respectively. The government subsidy income is $3,711 and $5,151. The discontinued unit will be recognized as government subsidy income of $12,707 and $3,991 in 2021 and 2020, respectively. There are no unfulfilled conditions and other contingencies.

(20) Other benefits and losses

ntingencies.
0)Other benefits and losses
Disposal of interests in property,
plant and equipment
Foreign currency exchange loss
Impairment losses on non-financial
assets
Lease Modification Benefit
Other losses
Less: Other benefits and losses of
closed units		 2021
2020
$ 2,052,593
( 30,649)
$-
(52,477)
( 2,083)
( 132,975)
14
( 911) (
16
294)
$ 2,018,964
( 185,730)
( 2,059,730)
($ 40,766)
278
($ 185,452)

(21)Financial cost

1)Financial cost
Interest expense
Borrowings from banks
Interest on lease liability
Less: Finance costs of closed units
Addition information on expenses
Employee benefits expenses
Property, plants, and equipment
Depreciation
Right-of-use asset Depreciation		 2021
$ 123,289
1,971
$ 125,260
( 12,076)
$ 113,184
2021
$ 302,475
190,201
7,844		 2020
$ 138,197
2,017
$ 140,214
( 9,975)
$ 130,239
2020
$ 269,592
203,043
7,037
$ 269,592
203,043
7,037

(22)Addition information on expenses 

~51~
(23) Intangible asset amortization cost


Less: Operating costs and operating
expenses of closed units
(
$ Employee benefit expense
Wages and salaries
Health and labor insurance
Pension expense
Other employee benefit expense
Less: Employee welfare expenses for closed units		 48,365
548,885
19,322)
(
529,563
2021


(
$




$ 253,666
44,356
3,447
1,006
302,475
( 12,786)
$ 289,689

  1. In accordance with the Company's Article of Incorporation, 0.1% to 1% of the earnings of the year should be appropriated for employee compensation and no more than 1% for directors and supervisors renumeration. However, if the Corporation has accumulated deficit, the priority is to offset the deficit first.

  2. The Company's 2021 and 2020 employee compensation and director compensation estimates are both $0.

The company's 2020 is a net loss before tax, so no employee remuneration and director's remuneration will be allocated.

The 2021 is based on the profit status of the year and the percentages stipulated in the articles of association as the basis for estimation. The board of directors has resolved that the actual allotment amounts are $1,671 and $0 respectively, of which employee compensation will be paid in cash. The differences in employee compensation and director compensation are $1,671 and $0, respectively, mainly due to changes in estimates and will be adjusted to profit or loss in 2022

Information on employee compensation and directors and supervisors renumeration approved by the Company's Board of Directors is posted on the Market Observation Post System.

(24)Income tax

  1. Income tax expense (benefit)

  2. (1)Composition of income tax:

Current income tax:：
Income tax generated from current
i
Land value added tax
Underestimation (overestimation)
f
i
i
Total current tax		 2021
$ 18,706
95,975
–

114,681		 2020
$ 19,780
-
( 855)
18,925		 
~52~
Deferred income tax:：
Origination and reversal of
temporary differences
Less: Income tax(benefits) expenses
for units that are discontinued
Income Tax Benefit		 ( 148,237)
( 33,556)

( 56,629)
$ 90,185		 ( 242,476)
( 223,551)
4 66
5,032
$ 218,519
  • (2) Amount of income tax related to other comprehensive income ：
2019
2021
Exchange differences on translation of
foreign financial statements
($ 7,509)
conciliation between income tax expense and accounting
2021
Income tax calculated using net profit (loss)
before tax based on statutory tax rate(Note)
$ 285,997
Income tax effects of adjustments based on
income tax laws and regulations
21,593
Changes in the realizability assessment of
deferred tax assets
4,376
Income exempt from tax under the tax law
( 348,030)
Land value added tax
95,975
Unrealized land value added tax recognized
in previous years Amount of effect of
provision for deferred income tax
( 93,467)
Previous income tax overestimation
-
( 33,556)
Less: Income tax (benefits) expenses for
units that are discontinued
( 56,629)
Income tax expenses
$ 90,185		 2020
$ 14,251
profit：
2020
($ 226,302)
5,434
-
( 1,828)
-
-
( 885)
( 223,551)
-
5,032
$ 218,519
  1. Reconciliation between income tax expense and accounting profit ：

Note: The basis of applicable tax rates is calculated using the income.

  1. The deferred income tax assets or liabilities generated from temporary ：
e deferred inco me tax as sets or lia bilities generated from bilities generated from temporary ：
Deferred income tax assets::
Temporary differences:：
Exchange differences on
translation of foreign financial
statements		 2021
December 31
29,896
January 1
$ 22,387		 Recognized in
Gain or loss
$ -		 Recognized in others
Comprehensive
income
$ 7,509		 Exchange
Rate impact
O
$ -		 ther (Note)
$ -		 
~53~
Unrealized exchange loss
14,311
Bonus for not taking leave
239
US state tax effects
3,549
Unrealized interest payable
15,493
Unrealized expenses
payable
4,316
Tax losses
257,520
317,815
Deferred income tax liabilities:
Temporary differences：
Investment income recognized
under foreign equity method( 142,745)
Depreciation expense
recognized as book-tax
difference
( 20,872)
Fiscal and tax differences in
amortization of intangible
assets
( 5,635)
Unrealized reserve for land
revaluation increment tax( 93,467)
( 262,719)
($ 55,096)		 6,130
( 119)
2,989)
21,706
( 2,431)
45,571
73,846
17,754
( 34,347)
( 2,483)
93,467
( 74,391)
$ 148,237		 -
-
-
-
-
-
7,509
-
-
-
-
-
$ 7,509		 -
-
( 135)
( 691)
( 93)
( 6,809)
( 7,728)
-
991
188
(-)
1,179
($ 6,549)		 -
-
-
-
-
4,273
4,273
-
-
-
-
-
$ 4,273		 20,441
120
6,403
36,508
1,792
300,555

395,715

($ 124,991)
( 54,228)
( 7,930)
-
( 187,149)
($ 208,566)

January 1
January 1
Deferred income tax assets:
Temporary differences:：
Exchange differences on
translation of foreign
financial statements
$ 8,136
Unrealized exchange loss3,809
Bonus for not taking
leave
258
Fiscal and tax differences
in amortization of
intangible assets
27
US state tax effects
23,637
Unrealized interest
payable
-
Unrealized expenses
-
Tax losses
156,805
192,672
Deferred income tax
liabilities:
Temporary differences:
Investment income recognized
under foreign equity
method
($ 192,672)
Depreciation expense
recognized as book-tax
difference
( 46,467)
Fiscal and tax differences in
amortization of intangible
assets
-
Unrealized reserve for
land revaluation increment
tax
( 93,467)
( 332,231)
($ 139,559)		 2020 2020
December 31
22,387
14,311
239
-
3,549
15,493
4,316
257,520
Recognized in
Gain or loss
$ -
10,052
( 19)
( 27)
( 19,615)
16,075
4,478
163,231
174,625

$ 49,552
24,144
( 5,845 )
-
67,851
$ 242,476)		 Recognized in others
Comprehensive
income
$ 14,251
-
-
-
-
-
14,251
$ -
-
-
-
-
$ 14,251
Exchange rate
Effects
$ -
-
-
-
( 473)
( 582)
( 162)
( 10,983)
12,200
-
1,451
210
-
( 1,661)
( $ 10,539)		 Other (Note)
$ -
-
-
-
-
( 51,533)
( 51,533)
$ -
-
-
-
($ 51,533)







317,815
($ 142,745 )
( 20,872 )
( 5,635 )
( 93,467 )
( 262,719 )
$ 55,096
$
(

Note: In 2020, the subsidiary applied for the 2017 taxable loss tax refund for the 

~54~

two years before the taxable income. Since the tax refund limit has been reached, the remaining taxable loss will be deferred and deducted.

  1. The validity period of tax losses which the Company has not used and the amounts of unrecognized deferred income tax assets are provided below ：

December 31,2021

Year of
ccurrence
Amount filed/
amount approved
2020
Approved amount		 Deductible
amount
$ 47,692
 Undeducted
amount
$ 26,523
 Unrecognized deferred
income tax assets
$-		 Year
for last
2020
December 31, 2020

o
Year of
ccurrence
Amount filed/
amount approved
2013
Reassessed
d
2014
Reassessed
d
2015
Approved amount
2016
Approved amount
2017
Approved amount
2018
Approved amount
2019
Amount filed
2020
Estimated amounts of filings
Deductible
amount
Undeducted
amount
$ 14,300 $ 14,300
3,003 3,003
9,018 9,018
26,590 26,590
72,817 72,817
56,901 56,901
40,604 40,604
45,556
45,556
$ 268,789
$ 268,789
Unrecognized deferred
income tax assets
$ -
-
-
-
-
-

$-
Year for
last
2023
2024
2025
2026
2027
2028
2029
2030
  • 5.The validity period of tax losses which the US subsidiaries have not used and the amounts of unrecognized deferred income tax assets are provided below ：

December 31,2021

Year of
occurrence
Amount
filed/amount
approved
2017-State tax
Amount filed
2019-Federal tax
Amount filed
2019-State tax
Amount filed
2020-Federal tax
Amount filed
2020-State tax
Amount filed
2021-Federal tax
Estimated amounts
of filings
2021-State tax
Estimated amounts
of filings		 Deductibl
tax amount
$ 4,428
70,518
13,312
76,792
37,610

74,938
17,651
$295,249		 Undeducted
tax amount
$ 4,428
70,518
13,312
76,792
37,610
74,938
17,651
$295,249		 Unrecognized
deferred
income tax
assets amount
$ -
-
-
-
-
-
$-		 Deductible year

2015~2037
Note
2020~2039
Note
2021~2040
No deduction
period
2022~2041
Year of
occurrence
f		 Amount
iled/amount
approved		 Deductibl
tax amount		 Undeducted
tax amount		 Unrecognize
d
deferred
year		 Deductible

December 31,2021 

~55~
019-Federal tax
Amount filed
019-State tax
Amount filed
020-Federal tax
Estimated amounts
of filings
020-State tax
Estimated amounts
of filings		 72,556
13,697
74,740
38,394
$199,387		 72,556
13,697
74,740
38,394
$199,387		 income tax
assets amount
$ -
Note
-
2020~2039
Note
-
2022~2040
$-

Note: The CARES Act passed in 2020 due to the novel coronavirus pneumonia epidemic, the taxable losses incurred in 2018, 2019 and 2020 can be offset for 5 years in advance or indefinitely.

  • 6.The validity period of tax losses which the subsidiary Holiday Garden Development Co., Ltd. has not used and the amounts of unrecognized deferred income tax assets are provided below: ：

December 31,2021

Year of
occurrence
Amount filed
/amount approved
2017
Approved filed
2018
Approved filed
2019
Approved filed
2020
Amount filed
2021
Estimated amounts
of filings		 Amount filed
/amount approved		 $



Deductible
amount
436
12,843
4,413
5,858
7,868		 Deductible
amount
436
12,843
4,413
5,858
7,868		 Undeducted
amount
$ 436
12,843
4,413
5,858
7,868

$ 31,418		 Unrecognized deferred
income tax assets amount		 Unrecognized deferred
income tax assets amount		 Unrecognized deferred
income tax assets amount
Year for last deduction
2027
2028
2029
2030
2031




$








$		 436
12,843
4,413
5,858
7,868
31,418

$

31,418

December 31,2020

o Year of
ccurrence
2017
2018
2019
2020		 Amount filed
/amount approved
Deductible amount
Undeducted
amount
Approved filed
$ 436
$ 436
Approved filed
12,843
12,843
Amount filed
4,413
4,413
Estimated amounts
of filings
4,187
4,187
$ 21,879
$ 21,879		 Unrecognized deferred
income tax assets amount
$ -
-
-
-
$-		 Year for last Year for last
deduction
2027
2028
2029
2030

  1. Due to the impact of the epidemic in the past two years, the Group has incurred operating losses, but it is expected that taxable income will be generated after the recovery of revenue in the future. It is likely that there will be sufficient taxable income to deduct temporary differences and taxable losses in the future use.

  2. The company's profit-seeking business income tax has been approved by the tax collection authority until 2019. 

~56~

(25) Earnings (l.oss) per share

ngs (l.oss) per share
Basic earnings per share
Current net income
attributable to the common
stock shareholders
of the parent company
Net profit for the period
attributable to the
discontinued unit of the
parent company owner
Net profit for the period
attributable to owners of
the parent company
Basic loss per share
Current net income
attributable to the
common stock
shareholders
of the parent company
Net loss for the current
period attributable to the
closed business unit of the
owner of the parent
company
Net loss for the period
attributable to owners of
the parent company





($ (
($		 Amount after
tax
251,381 )
18,928 )
270,309 )		 Weighted average of
Outstandingshares
(1,000shares)
110,486
110,486
110,486

(26)Operating lease

  1. On December 9, 2021, the Group purchased SpringHill Suites by Marriott San Jose Fremont Hotel for $1,156,684 (US$41,750,000) in cash, mainly operating hotelrelated business in the United States. The Group expects to strengthen its position in these markets after the acquisition.

  2. Information on the fair value of the consideration paid for the acquisition of 

~57~

SpringHill Suites by Marriott San Jose Fremont Hotel, the assets acquired and the liabilities assumed on the acquisition date are as follows

December December December 09, 2021
Purchase consideration
Cash $ 1,156,684
Fair value of identifiable assets acquired
and liabilities assumed
Real estate and equipment 964,411
Intangible assets $ 192,273
Total identifiable net assets 1,156,684
Business reputation $ -
Group consolidated the SpringHill Suites by Marriott San Jose Fremont Hotel
cember 9, 2021. The operating income and pre-tax net loss contributed by th
were $4,099 and $9,133 respectively.
pplementary information on cash flow
nvesting activities with only partial cash receipts and payments:
2021
2020
Purchase of real estate, plant and
equipment
 $ 8,586 $ 1,854
Add: Accounts payable at the
beginning of the period-land
destination change deposit 127,577 127,577
(listed as "long-term bills and
payments payable)"
Equipment payable at the
beginning of the period (listed as – 1,610
"other payables")
Minus: other accounts payable at
the end of the period - cash for
change of destination (listed in		 – ( 127,577 )
"long-term bills and payments")
Equipment payable at the end of
the period ("Other payables" in
 ( 3,709) –
the table)
Cash payment in the current
period
 $ 132,454 $ 3,464
  1. The Group consolidated the SpringHill Suites by Marriott San Jose Fremont Hotel on December 9, 2021. The operating income and pre-tax net loss contributed by the hotel were $4,099 and $9,133 respectively.

(27) Supplementary information on cash flow

  1. Investing activities with only partial cash receipts and payments: 
~58~

2. Financing activities that do not affect cash flow:

Long-term borrowings are
transferred to the portion due
within one year
$ Advance payments for
equipment transferred to
property, plant and equipment
$		 2021

2020

807,943 $ 718,775

11,471 $ 175,209		 2020

175,209

(28) Changes in liabilities from financing activities

1. Investment activities paid partially by cash: ：


Jan. 01

Changes in financing
cash flow
(
Other non-cash
changes(Note)
Effects of Exchange
Rate Changes
Dec. 31

Jan. 01
Changes in
financing cash flow
Other non-cash
changes(Note)
Effects of Exchange
Rate Changes
Dec. 31
$
$		 2021 Total liabilities
from financing
activities

5,575,671
57,435
8,525
114,176)

5,527,455
Total
liabilities
from
financing
activities

5,758,895
9,562
1,084
193,870)

5,575,671
Short-term
Loan


1,609,599
725,599 ) (
–
–

884,000
Short-term
Loan

$ 1,530,000
79,599
–
–
$ 1,609,599
$
$		 Short-term
notes
payable


130,000
100,000 ) (
–
–

30,000
$
$		 Lease
Liability

119,733
6,470 )
8,525
– (
121,788
2020
$
$		 Long term
Loan


3,716,339 $ 889,504
–
114,176 ) (

4,491,667 $




$ $
Short-term
Loan


1,530,000
79,599
–
–

1,609,599


$ $		 Short-term
notes
payable


130,000 $ – (
–
–

130,000 $		 Lease
Liability


123,379
4,730 )
1,084
– (

119,733
$
$		 Long term
Loan

3,975,516
65,307
–
193,870 ) (

3,716,339		 $
$		 
~59~

Note: Non-cash changes arising from the increase, disposal and lease modification of right-of-use assets.

7.Transactions with related parties

Primary management renumeration and compensation information


Short-term employee benefits
$ e Group's collateralized assets are listed below：

Assets
December 31, 2021
Land and land improvements
$ 1,003,048
Buildings and structures
2,530,361
Business facilities/equipment
414,767
Time deposits (Stated as “Amortizes cost
Financial assets–current」)
957,921
Time deposits (Stated as “Amortizes cost
Financial assets–illiquid t」)
85,295
Demand deposit (Stated as “Amortizes
cost Financial assets-current”)
368
$ 4,991,760
Short-term employee benefits
$ e Group's collateralized assets are listed below：

Assets
December 31, 2021
Land and land improvements
$ 1,003,048
Buildings and structures
2,530,361
Business facilities/equipment
414,767
Time deposits (Stated as “Amortizes cost
Financial assets–current」)
957,921
Time deposits (Stated as “Amortizes cost
Financial assets–illiquid t」)
85,295
Demand deposit (Stated as “Amortizes
cost Financial assets-current”)
368
$ 4,991,760		 2021
3,850
Book value		 2021
3,850
Book value		 2021
3,850
Book value
$ $

December 31, 2021
December 31, 2020
$ 1,372,935
2,180,219
324,080
971,578
-
1,927
$ 4,850,739

Long -term
Long-term
Long-term
Short-term
Long-term
Gift Voucher
Performance
Guarantee

8.The Group's collateralized assets are listed below ：

9.Significant contingent liabilities and unrecognized contractual commitments

(1) Contingencies

None

(2)Undertakings

  1. Subsidiaries purchased Clementine Inn Anaheim, TownePlace Suites Newark Silicon Valley, Embassy Suites Valencia, Holiday Inn Express Walnut Creek, Hyatt Place Emeryville and SpringHill Suites by Marriott San Jose Fremont are currently operated by Aimbridge Corporation (formerly Interstate Corporation). The contract signed (the contract expiry date is November 19, 2024, August 31, 2024, August 31, 2024, June 22, 2022, April 11, 2026 and December 7, 2031 date), the subsidiary shall pay Aimbridge's monthly management fees and performance bonuses, which are calculated by a certain ratio based on the conditions stipulated in the contract.

  2. 2.According to the management contract signed with Aimbridge, the subsidiary must allocate a certain percentage of the total operating income to a special account on a monthly basis to purchase or repair related assets (except offices). If the special 

~60~

account is insufficient to pay for the hotel-related assets For the purchase or repair, the subsidiary company shall allocate a full amount to the account.

  1. Subsidiary - HOLIDAY GARDEN NW CORP. signed a royalty contract with Marriott. According to the contract, TownePlace Suites Newark Silicon Valley will use Marriott's management and maintenance system until March 31, 2030, and must be based on the total room revenue. Proportionate royalties paid to Marriott.

  2. Subsidiary - HOLIDAY GARDEN VC CORP. signed a royalty contract with Hilton. According to the contract, Embassy Suites Valencia will be paid a certain percentage of the total room revenue due to the use of Hilton's management and maintenance system until September 10, 2030. Royalties to Hilton Corporation.

  3. Subsidiary - HOLIDAY GARDEN WC CORP. signed a royalty contract with IHG. According to the contract, Holiday Inn Express Walnut Creek as of July 11, 2031, due to the use of IHG's management and maintenance system, must be based on the total room revenue. Proportionate royalties paid to IHG.

  4. Subsidiary - HOLIDAY GARDEN EV CORP. signed a royalty contract with Hyatt Company. According to the contract, Hyatt Place Emeryville must pay a certain percentage of the total room revenue due to the use of Hyatt Company's management and maintenance system until November 21, 2041. Royalties to Hyatt Corporation.

  5. Subsidiary-HOLIDAY GARDEN FM CORP. signed a royalty contract with Marriott. According to the contract, SpringHill Suites by Marriott San Jose Fremont as of August 26, 2041, due to the use of Marriott's management and maintenance system, must be based on the total room revenue. A certain percentage of royalties are paid to Marriott.

  6. Subsidiary-HOLIDAY GARDEN SF CORP. signed a long-term loan contract with CTBC BANK CO.,LTD. on February 11, 2016, with a total credit line of USD 31,000,000. Subsidiary-HOLIDAY GARDEN SF CORP. The financial structure should maintain an interest coverage ratio of not less than 1.3 times. The subsidiary, HOLIDAY GARDEN SF CORP., negotiated with CTBC BANK CO., LTD. on May 15, 2020 to exempt the requirement that the interest coverage ratio should be maintained at least 1.3 times in a single year in 2020. In addition, it negotiated with CTBC BANK CO., LTD. on November 4, 2021 to waive the requirement that the interest coverage ratio should not be less than 1.3 times for the pledged fixed deposit of $41,339. 

~61~

  1. Subsidiary-HOLIDAY GARDEN NW CORP. signed a long-term loan contract with FIRST COMMERCIAL BANK, LTD. on July 24, 2020, with a total credit line of USD 15,331,000. Subsidiary-HOLIDAY GARDEN NW CORP. and committed financial The structure should maintain the interest coverage ratio of not less than 1.15 times. The subsidiary, HOLIDAY GARDEN NW CORP., negotiated with FIRST COMMERCIAL BANK, LTD. on February 17, 2021, and agreed that starting from 2022, the requirement that the interest coverage ratio should be maintained at least 1.15 times.

  2. 10.Subsidiary-HOLIDAY GARDEN VC CORP. signed a long-term loan contract with FIRST COMMERCIAL BANK, LTD. on March 6, 2020, with a total credit line of USD 24,850,000. Subsidiary-HOLIDAY GARDEN VC CORP. and committed financial The structure should maintain the interest coverage ratio of not less than 1.15 times. The subsidiary, HOLIDAY GARDEN VC CORP., negotiated with FIRST COMMERCIAL BANK, LTD. on February 17, 2021 to exempt the requirement that the interest coverage ratio should be maintained at not less than 1.15 times in 2020 and 2021.

  3. 11.Subsidiary-HOLIDAY GARDEN WC CORP. signed a long-term loan contract with FIRST COMMERCIAL BANK, LTD. on August 29, 2016, with a total credit line of USD 23,300,000. Subsidiary-HOLIDAY GARDEN WC CORP. and committed financial The structure should maintain the interest coverage ratio of not less than 1.15 times. The subsidiary, HOLIDAY GARDEN WC CORP., negotiated with FIRST COMMERCIAL BANK, LTD. on February 17, 2021 to exempt the requirement that the interest coverage ratio should be maintained at least 1.15 times in 2020 and 2021.

  4. 12.Subsidiary-HOLIDAY GARDEN EV CORP. signed a long-term loan contract with CTBC BANK CO.,LTD. on April 12, 2019, with a total credit line of USD 46,000,000. Subsidiary-HOLIDAY GARDEN EV CORP. promised during the credit period The financial structure should maintain an interest coverage ratio of not less than 1.2 times. The subsidiary, HOLIDAY GARDEN EV CORP., negotiated with CTBC BANK CO., LTD. on May 15, 2020 to exempt the requirement that the interest coverage ratio should be maintained at least 1.2 times in a single year in 2020. In addition, on November 4, 2021, it negotiated with CTBC BANK CO., LTD. to waive the requirement that the interest coverage ratio should not be less than 1.2 times for the pledged fixed deposit of $43,956.

  5. 13.Subsidiary-HOLIDAY GARDEN FM CORP. signed a long-term loan contract with FIRST COMMERCIAL BANK, LTD. on December 6, 2021, with a total credit line of USD 27,000,000. Subsidiary-HOLIDAY GARDEN FM CORP. and committed financial The structure should maintain the interest coverage ratio of not less than 1.15 times from 2023. 

~62~

14.As of December 31, 2021 and 2020, the Group's total contracted purchase prices for outstanding works and prepaid equipment purchases were $189,648 and $198,661, respectively, and the unrecognized amounts were $28,041 and $39,278, respectively.

10.Significant casualty losses

None

11.Major events after the reporting period

None

12.Other

(1)Capital management

The Group’s capital management objectives are to secure the Company’s ability to continue as a going concern, maintain the optimal capital structure for reducing the cost of capital, and to provide returns to our shareholders. To maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, or issue new shares or sell assets to reduce the liabilities. Consistent with the industry’s practice, the Group manages the assets by the debt to assets ratio.

The Group's strategy is to maintain a stable debt to assets ratio. See below for the ratios ：

tios：
December 31, 2021
December 31, 2020
Total liabilities $ 5,849,236
$		 6,070,809
Total assets $ 8,607,434
$		 7,032,760
Debt to assets ratio 68
86
inancial instruments
Types of financial instruments
December 31, 2021 December 31, 2020
Financial assets
Financial assets measured at amortized cost
Cash and cash equivalents $ 2,145,257 $ 887,011
Financial assets measured at amortized cost 1,051,995 973,505
Notes payable 323 -
Accounts payable 30,980 24,727
Other accounts payable 567 823
Guarantee deposits received 10,266 10,040

(2)Financial instruments

1. Types of financial instruments

~63~
Financial liabilities
Financial liabilities measured at amortized
cost
Short-term borrowings
Short-term notes and bills payable
Accounts payable
Other payables
Long-term borrowings (including the
current portion of long-term debt payable)
Long-term notes and accounts payable
Guarantee deposits received
Lease liabilities		 $ 3,239,388
$ 884,000
30,000
1,814
91,647
4,491,667
-

181
$ 5,499,309
$ 121,788		 $ 1,896,106
$ 1,609,599
130,000
3,712
67,336
3,716,339
127,577
755
$ 5,655,318
$ 119,733
  1. Financial instruments not measured at fair value

The Group’s financial assets and liabilities that are not assessed by fair value (including cash and cash equivalents, notes receivable, accounts payable, other receivable, other financial assets (current), refundable deposits, short-term borrowings, short-term notes payable, notes payable, accounts payable, other payable, long-term borrowings (including current portion of long-term debt payable), long-term notes and accounts payable, and guarantee deposits receive) have a carrying value reasonably close to their fair value.

  1. Risk management policies

  2. (1) The Group's regular operations are affected by multiple financial risks, including market risk (including the foreign exchange rate risk, interest rate risk, and price risk), credit risk, and liquidity risk.

  3. (2) Risk management work is implemented by the Group's finance department in accordance with the approved policies. The Group's finance department closely collaborates with all operating departments for identifying, evaluating, and avoiding financial risk. 

~64~

  1. Nature and level of significant financial risk

  2. (1) Market risk

Foreign exchange rate risk

  • A. The Group is a multinational corporation, and as a result, the Group is exposed to foreign exchange rate risk generated from transactions using currencies different from the Company and the subsidiaries’ functional currency (primarily the US dollars). Related foreign rate exchange risk from future commercial transactions and recognized assets and liabilities.

  • B. The Group’s management has set policies requiring the Group to manage the foreign exchange rate risk related to its functional currency. Each company should manage the risk according to the overall foreign exchange rate risk through the finance department of the Group.

  • C. The Group’s businesses involve several non-functional currencies (The Company’s functional currency is New Taiwanese dollars, while the subsidiaries’ functional currency is US dollars), and they are affected by exchange rate fluctuation. Information of foreign currency assets and liabilities subject to material effect of exchange rate fluctuation is presented below: 

~65~
(Foreign currency:
functional currency)
Financial assets
Currency item
US$ : NT$ (Foreign currency:
functional currency)
Financial assets
Currency item
US$ : NT$		 December 31, 2021 December 31, 2021
Sensitivity analysis
Effect on profit
and loss
Effect on other
comprehensive income
$ 15,839 $ -

Sensitivity analysis
Effect on profit
and loss
Effect on other
comprehensive income
$ 10,013 $ -

Foreign currencies
(NT$1,000)
$ 57,222

Exchange rate
Carrying amount
(NT$)
Degree of
variation
27.68 $ 1,583,905
1%
December 31, 2020

Effect on profit
and loss
$ 15,839 $

$

Foreign currencies
(NT$1,000)
$ 35,157
Exchange rate
Carrying amount
(NT$)
28.48 $ 1,001,271

Sensitivity analysis

Degree of
variation
1%
Effect on profit
and loss
$ 10,013 $

$		 

~66~
  • D. In 2021 and 2020, the aggregate amounts of all exchange losses (including realized and unrealized) of the Group's monetary items due to exchange rate fluctuations that have a significant impact are $30,649 and $52,477, respectively.

Price risk

None significant market risk is expected to the Group.

Cash flows and fair value interest rate risk 

  - A. The Group’s interest risk comes from short-term and long-term borrowings at a floating rate of interests, and they expose the Group to cash flow interest rate risk. At December 31, 2021 and 2020, the Group’s borrowings at floating rate of interests are in NT dollars and US dollars.

  - B. The Group’s loans are measured at amortized cost and the interest rates are re-set each year according to the contract. Therefore, the Group is exposed to the risk of future market interest rate changes.

  - C. When the borrowing rate increases or decreases by 1%, and all other factors remain unchanged, the net profit before tax in 2021 and 2020 will decrease or increase by $53,757 and $53,259, mainly due to the change in interest expense caused by floating rate borrowing.

  • (2) Credit risk

  • A. The Group is exposed to credit risk of customers’ or financial instruments’ failure of fulfilling their contractual obligation, which can expose the Group to the risk of financial loss. The primary source of credit risk is the counterparty's failure of paying accounts receivable according to the terms of payment and the contractual cash flows of investment in liability instruments measured at fair value through profit and loss.

  • B. The Group establishes credit risk management from the Group’s perspective. Before entering into the terms and conditions of payment and service rendering with each new customer, each operating entity of the Group has to manage and analyze the credit risk in accordance with the internal credit policy. Internal risk control evaluates a customer's credit quality based on the customer’s financial condition, past experience, and other factors.

  • C. The Group adopts the premise provided by IFRS9: When the payment is 30 

~67~

days past due according to the contractual terms and conditions, the credit risk of this financial asset is deemed to have increased significantly since its initial recognition.

  • D. The Group adopts the premise provided by IFRS9: When the payment is more than 90 days past due according to the contractual terms and conditions, default is deemed to have happened.

  • E. The Group classifies customers’ notes and accounts receivable according to credit conditions and adopts a simplified method of using the loss rate as the basis for estimating the expected credit loss.

  • F. According to future forward-looking considerations, the Group adjusts the loss rate established based on the history of the specific period and current information to estimate the loss allowance of notes and accounts receivable. The provision matrix of December 31, 2021 and 2020 is as follow: ：

December 31, 2021
Expected loss rate
Total book value
Allowance for loss
December 31, 2020
Expected loss rate
Total book value
Allowance for loss		 Not past due
Past due for 1
to 30 days
0.34%
$ 28,214
8
Not past due
Past due for 1
to 30 days
0.34%
$ 18,692
5		 Past due for 31
to 90 days
0.81%
$ 3,102
5
Past due for 31
to 90 days
0.81%
$ 6,050
10		 Past due for more than
Total
$ 31,502
199

Total
$ 25,738
1,011
91 days
100.00%
$ 186
186
Past due for more than
91 days
100%
$ 996
996
  • G. The group simplified the accounts receivable as following ：
2021 2020
Accounts Receivable Accounts Receivable
January 1 $ 1,011 $ 350
Impairment losses for continuing - 220
operating units
Provision for impairment loss of - 447
units that are discontinued
Reversal of provision for impairment ( 266) -
losses that are continuing operating
units
Reversal of provision for impairment ( 542) -
losses that are discontinuing units
Exchange rate impact
(		 4) ( 6) 
~68~

December 31 $ 199 $ 1,011

  • (3) Liquidity risk

  • A. Cash flows forecasts are performed by each operating entity of the Company and summarized by the finance department of the Group. The Group’s finance department monitors the Group's circulating capital requirements to ensure that the Company has sufficient capital for its operating needs and to maintain a sufficient unspent loan commitment at all times 。

  • B. The surplus cash held by each operating entity will be transferred back to the Group Finance Department when it exceeds the management needs of working capital. The Group Finance Department invests the remaining funds in interest-bearing demand deposits, cheque deposits and time deposits, and the instruments selected by it have an appropriate maturity date or sufficient liquidity to meet the above forecast and provide sufficient dispatch levels. As at 31 December 2021 and 2020, the Group held money market positions of $2,144,159 and $885,344, respectively, to generate immediate cash flow to manage liquidity risk.

  • C. The following table shows the Group's non-derivative financial liabilities, which are classified by the maturity date. Non-derivative financial liabilities are analyzed based on the time remains from the balance date to the contractual maturity date. The following table disclose the amount of contractual cash flows that is non-discounting.

December 31, 2021

December 31, 2021
Non-derivative financial liabilities:
In 1 year
Short-term borrowings
$ 885,289
Short-term notes and bills payable
30,000
Accounts payable
1,814
Other accounts payable
91,647
Lease liability.
10,190
Long-term borrowings
(Expires within one year)
914,390
Guarantee deposits received
144
Derivative financial liabilities: none
December 31, 2020
Non-derivative financial liabilities：
In 1 year
Short-term borrowings
$ 1,611,948
Short-term notes and bills payable
130,000
Accounts payable
3,712		 1 to 2 years
$ -
-
-
-
11,425
255,321
-
1 to 2 years
$ -
-
-		 More than 2 years

$ -
-
-
-
116,563
3,783,224
37
More than 2 years
$ -
-
-		 
~69~
Other accounts payable 67,336 - -
Lease liability. 8,411 8,386 121,022
Long-term borrowings 808,883 902,169 2,341,606
(Expires within one year)
Long-term notes and accounts payable- - 127,577 -
Guarantee deposits received 393 - 362

13.Supplementary disclosure

(1) Information related to material transactions

  1. Financing provided: See Table 1 attached.

  2. Endorsement provided: None

  3. 3.Marketable securities held at end of reporting period (excluding investments in subsidiaries, associates, and joint ventures): None

  4. Marketable securities acquired and disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital: See Table 2 attached.

  5. Properties acquired at costs or prices of at least NT$300 million or 20% of the paid-in capital: See Table 3 attached.

  6. Properties disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital: None

  7. Total purchases from or sales to related parties of at least NT$100 million or 20% of the paid-in capital: None

  8. Receivable from related parties amounting to at least NT$100 million or 20% of the paid-in capital: See Table 4 attached

  9. Engagement in derivative instruments: None

  10. Business relations and material transactions and amounts between the parent company and its subsidiaries and among the subsidiaries: See Table 5 attached.

(2) Re-investment related information

The investee's name, location, and other related information (excluding investees 。 in mainland China): See Table 6 attached

(3) Investment in mainland China

  1. Basic information: None 。

  2. Significant direct or indirect transactions with the investee in mainland China through an enterprise at a third place: None

  3. (4) Information of major shareholders

Information of major shareholders: Please refer to Schedule VI for details.

14.Segment information

(1) General information

The Group takes a regional perspective in its operation and decision-making. Management too adopts this model to identify the divisions to be reported. 

~70~

The Group has two reportable segments: Taiwan business segment and US business segment. The primary scope of business operation of Taiwan business segment is tourism hotels and attached restaurants and swimming pools. The primary scope of business operation of US business segment is tourism hotels.

(2) Measurement of segment information

The Group uses the operating income of each operating department as the evaluation performance basis.

(3)Segment information

The reportable segment information provided to main operations decision makers is as follows ：

follows：
Revenue
External Client
Revenue
Divisional
profit & loss
(
Interest income
Company
general
revenue
Other company
profits &
losses
Interest
expense
Net (loss)
profit before
tax
Departmental
Assets
Company
general assets
Total assets
Depreciation
&
Amortization
Expenses
Amount of
capital
expenditure
Departmental
Liabilities		 2021
Taiwan
business

$ 72,883
$ 79,129) (
$ 42,072
$ 20,193
$ 8,586
$1,207,571		 
~71~

2020

Revenue
External Client
Revenue
Divisional
profit & loss
(
Interest income
Company
general
revenue
Other company
profits &
losses
Interest
expense
Net (loss)
profit before
tax
Departmental
Assets
Company
general assets
Total assets
Depreciation
&
Amortization
Expenses
Amount of
capital
expenditure
Departmental
Liabilities		 Taiwan
business

$ 128,838
$ 42,505) (
$ 695,701
$ 35,355
$ 1,854
$2,292,783		 USA business
Total
Closed unit
Continuing
business
unit
$ 612,865
$ 741,703
$ 82,849
$ 658,854
$ 156,921) ( $ 199,426 ) ( $ 22,436 )( $ 176,990)
15,983
–
15,983
15,527
8,729
6,798
(
185,730 ) (
278 )(
185,452)
(
140,214) (
9,975)(
130,239)
$ 493,860
$ 23,960 ($ 469,900 )
$ 3,251,732
$ 3,947,433
$3,947,433
3,085,327
$ 7,032,760
$ 224,648
$ 260,003
$ 21,425
$ 238,578
$–
$ 1,854
$ 1,854
$ 3,778,026
$6,070,809
$ 6,070,809

(4) Reconciliation of segment profit and loss

The total amount information of the reportable segments and the disclosed information of other critical items are consistent with the amounts of profit and loss before tax, assets, liabilities, and other related items in the Company's financial report, and they were measured by consistent methods.

(5) Product type and service type information

。 Please refer to Note 6(17) 

~72~

(6) Regional information

The Group's regional information for 2021 and 2020 is as follows: ：

USA
Taiwan
minus: Closed
unit
 2019
Revenue
Non-current assets
781,275
$ 4,763,215
72,883
155,178
854,158
$ 4,918,393
33,012 )
-
821,146 $ 4,918,393		 2018 2018
$ Revenue
781,275
72,883
854,158
33,012 )
821,146		 $ Revenue
612,865
128,838
741,703
82,849)
658,854


(
$
$ (
$

(7) Important customer information

It is not applicable because none of the revenue from each customer of the Group in 2021 and 2020 reached 10% of the amount of the comprehensive income statement. 

~73~

Holiday Garden International Ltd. and subsidiaries

Loan funds

January 1,2021 to December 31,2021
Table 1
No.
(Note.1)
Company providing
the loan
Borrower
Transaction
item(Note2)
A
related
party
yes or
not
The maximum
amount of this
period(Note3)
Closing balance
(Note 8)
Actualdrawing
amount
Range of
interest
rate
1
Holiday Garden
International
Ltd.
Holiday Garden
U.S.
Receivable
from related
companies
yes
$ 1,448,560 $ 1,448,560 $ 1,054,242
Annual
interest
6.5%

2
Holiday Garden
U.S.
Holiday Garden
NW CORP.
Receivable
from related
companies
yes
240,870 240,870 92,520
Annual
interest
3.0%

2
Holiday Garden
U.S.
Holiday Garden
VC CORP.
Receivable
from related
companies
yes
194,610 194,610 46,260
Annual
interest
3.0%

2
Holiday Garden
U.S.
Holiday Garden
WC CORP.
Receivable
from related
companies
yes
584,820 584,820 429,370
Annual
interest
6.5%

2
Holiday Garden
U.S.
Holiday Garden
WC CORP.
Receivable
from related
companies
yes
64,980 64,980 64,980
Annual
interest
3.0%

2
Holiday Garden
U.S.
Holiday Garden
EV CORP.
Receivable
from related
companies
yes
94,950
94,950
31,650
Annual
interest
6.5%

2
Holiday Garden
U.S.
Holiday Garden
EV CORP.
Receivable
from related
companies
yes
953,680 559,362 559,362
Annual
interest
6.5%

2
Holiday Garden
U.S.
Holiday Garden
EV CORP.
Receivable
from related
companies
yes
84,030 84,030 84,030
Annual
interest
6.5%

2
Holiday Garden
U.S.
Holiday Garden
FM CORP.
Receivable
from related
companies
yes
430,900
430,900
430,900
Annual
interest
3.0%

3
Holiday Garden SF
CORP.
Holiday Garden
VC CORP.
Receivable
from related
companies
yes
154,200 154,200 –
Annual
interest
3.0%

3
Holiday Garden SF
CORP.
Holiday Garden
U.S.
Receivable
from related
companies
yes
387,516 387,516 387,516
Annual
interest
3.0%
 Type of
loan fund
(Note 4)
Business
transaction
amount
(Note 5)
Reasons for
short-term
financing
(Note6)
Short-term
financing
funds
$ -
Operational
needs

Short-term
financing
funds
-
Hotel
acquisition

Short-term
financing
funds
-
Hotel
acquisition

Short-term
financing
funds
-
Hotel
acquisition

Short-term
financing
funds
-
Hotel
acquisition

Short-term
financing
funds
-
Hotel
acquisition

Short-term
financing
funds
-
Operational
needs

Short-term
financing
funds
–
Hotel
acquisition

Short-term
financing
funds
–
Operational
needs、Hotel
acquisition

Short-term
financing
funds
-
Hotel
acquisition

Short-term
financing
funds
-
Operational
needs
 Recognized
amount of
loss
allowance
$ -
-
-
-
-
-
-
-
-
-
-		 Collaterals

Name
Value
None $ -
None -
None -
None -
None -
None -
None -
None -
None -
None -
None -		 Unit: NT$1,000
(Unless otherwise noted)
Maximum amount of
loans permitted to
a single
borrower(Note 7)
Total amount
permitted for
loaning of funds
（Note 7）
Note
$ 74,640,950 $ 149,281,900 Note 9
11,924,650 23,849,300 Note 9
11,924,650 23,849,300 Note 9
11,924,650 23,849,300 Note 9
11,924,650 23,849,300 Note 9
11,924,650 23,849,300 Note 9
11,924,650 23,849,300 Note 9
11,924,650 23,849,300 Note 9
11,924,650 23,849,300
Note 9
6,843,350 13,686,700 Note 9
6,843,350 13,686,700 Note 9

Table 1

Note 1: See the footnotes below

 (1) 0 for the Company

 (2) For the investees, they are coded from 1 according to the company. Investees of the same company share the same code

Note 2: Recorded accounts receivable from related companies and/or parties, shareholders accounts, prepayments, temporary payments, etc. should be entered in this field if they are related to loans to others.
Note 3: It is the cumulative maximum balance of loaning others from the current year to the reporting month.

Note 4: For loans to others and the type, fill in the parties that the Company has business transaction with or that require short-term financing funds.

Note 5: For the business transaction type of loans, fill in the amount of the business transactions.

Note 6: For those requiring the short-term financing type of loans, concretely explain the reason for loaning and the borrowers ’ use of the loans, such as for making repayments, purchase of equipment, or operational needs ： Note 7: Enter the limit of loans for individual borrowers and the total amount of loans set by the Company in accordance with the loans to others operating procedure and enter the method of calculation of the limit of loan for individual borrowers and the total limit of loans in the note section. 

Note 8: Enter the amount of funds loaned to others that remains effective as of the reporting month. (For an publicly listed company deciding to resolve each fund to be loaned to other at the Board of Directors according to Article 14.1 of the
Procedure of Management of Loans to Others, then even if the fund has not yet been appropriated, the amount of loans resolved at the Board of Directors should be stated in the announced balance to disclose the exposed risk.If said funds are
repaid later, the balance after the repayment should be disclosed to reflect the adjusted risk. If, in accordance with Article 14.2 of Regulations Governing the Administration of Shareholder Services of Public Companies, a publicly listed
company decides to authorize the chairperson of the board, resolved at the board of directors, to have the funds for lending that are within the specific amount authorized in installment or revolver within one year, it is the balance of the
amount of loans to others approved at the Board of Directors that should be announced and filed. Said loans to others may be repaid later, but because lending may be authorized again, use the amount of loans to others approved by the Board of
Directors as the balance announced and reported.

~74~

Note 9: In accordance with the Company's Operating procedure of management of loans to others, the amount of loans to foreign subsidiaries, in which the Company holds directly or indirectly, 100% of the voting shares or to individual borrowers
should not exceed 7.5 times of the Company's net value, and the total amount of loans should not exceed 15 times of the net value of the company, and the duration of loans should be no more than 15 years.

Holiday Garden International Ltd. and subsidiaries

                                                             Properties acquired of at costs or prices of at least NT$300 million or 20% of the paid-in capital

January 1,2021 to December 31,2021

Table 2

  Unit: NT$1,000

(Unless otherwise noted)

The former tranfer information of transaction object is related party purpose of other Company which Occuring Transaction Payment of Relationship with Transfer reference of acquirsition appointment acquired properties property name Date amount price Transaction object Relationship Holder issuer daye Amount priceBasis Usage Item Holiday Garden EV SpringHill Suites 110/12/09 $ 964,411 $ 964,411 MILLENNIUM HOTEL None-related - - - $ - Valuation Operating the None CORP. by Marriott INC. parties report food and hotel San Jose business in Fremont 旅館 U.S.A

Note 1: If appraisal is required for asset disposal in accordance with the regulations, enter the appraisal results in the section “Reference for price determination. ” 

Note 2: Paid-in capital refers to the paid-in capital of the parent company. If the shares issued by an issuer have no par value or a par value other than NT$10 per share, the threshold transaction amount of 20% of
paid-in capital shall be replaced by 10% of equity attributable to owners of the parent company as stated in the balance sheet.

Note 3: Date of occurrence refers to the date of contract signing, date of payment, date of consignment trade, date of transfer, dates of boards of directors resolutions, or other date that can confirm the
counterparty and monetary amount of the transaction, whichever date is earlier.

~75~

Ho li da y Ga rd en H ot el C o. , L td

Th e am ou nt  o f re al  e st at e d is po se d of  i s NT $3 00  m il li o n or  2 0%  o f th e pa id -i n ca p it al  a bo ve

Ja nu ar y 1, 20 21  t o De ce mb er  31 ,2 02 1

Ta bl e 3

[Disposal ] Company Original Amount of Price profit and Reference basis disposing of Property Date of fact date of Carrying the collection loss Trading Punishment for price Other real estate name (Note 1) acquisition amount transaction situation (Note 2) partners Relation purpose determination agreements 

Referring to
market
The price is
conditions and
charged
obtaining two
The real according to
real estate
estate at the
Holiday Garden Yongshuo According to appraisal
the current conditions
International  May 05,2021  Jul.29,1959  $642,673 2.7 billion $1,960,037 Investment None business reports, the None
location of agreed in
Ltd. Co., Ltd. strategy appraisal
Liuheguan's the sales
results are
operation and purchase
about 2.34
agreement of
billion and
both parties
2.45 billion
respectively.

No te  1 . Th e da te  o f th e fa c t is  t he  d at e of  t he  r es ol u ti on  o f th e bo ar d of  d ir ec t or s.
  • No te 2 . Di sp os al ga in s an d lo ss es a re c al cu la te d b as ed o n th e se ll in g p ri ce a ft er d ed uc ti ng t he b o ok v al ue o f th e re al e st at e a nd r el at ed b us in es s ta xe s, tr an sa ct io n co st s, a nd l an d v al ue -a dd ed t ax . 
~76~

Holiday Garden International Ltd. and subsidiaries

Receivable from related parties amounts to at least NT$100 million or 20% of the paid-in capital.
January 1,2021 to December 31,2021
Table 4
Companies of account
receivable
Holiday Garden International
Ltd.
Holiday Garden U.S.
Holiday Garden SF CORP.
Holiday Garden U.S.
Holiday Garden WC CORP.
Holiday Garden EV CORP.
Holiday Garden U.S.		 Transaction object name
Holiday Garden U.S.
Holiday Garden WC CORP.
Holiday Garden U.S.
Holiday Garden EV CORP.
Holiday Garden SF CORP.
Holiday Garden SF CORP.
Holiday Garden FM CORP.		 Relationship
Balance of Receivable from related
companies (Note 1)
Note 3
Account receivable：1,063,466
Note 3
Account receivable：465,301
Note 3
Account receivable：367,784
Note 3
Account receivable：680,478
Note 3
Account receivable：141,205
Note 3
Account receivable：125,684
Note 3
Account receivable：487,608		 Unit: NT$1,000
(Unless otherwise noted)

Turnover rate
Past due accounts
receivable from relatedAccounts receivable recovered
from related companies after
the reporting period
Amount of loss
allowance recognized
Amount
Treatment
Note 4
$ -
- $ -
$ -
Note 4
-
- -
-
Note 4
-
- -
-
Note 4
-
-
-
-
Note 4
-
- -
-
Note 4
-
- -
-
Note 4
-
- -
-		 
Note 1: Please enter the accounts receivable of the related parties, the notes, and other accounts receivable.

Note 2: Paid-in capital refers to the paid-in capital of the parent company. If the shares issued by an issuer have no par value or a par value other than NT$10 per share, the threshold transaction
amount of 20% of paid-in capital shall be replaced by 10 percent of equity attributable to owners of the parent company as stated in the balance sheet.
Note 3: The investee and the counterparty are both subsidiaries of the Company.

Note 4: It is mainly because that “other accounts receivable ” is not suitable for calculating the days of turnovers. 

~77~

Holiday Garden International Ltd. and subsidiaries

Business relations and material transactions and amounts between the parent company and its subsidiaries and among the subsidiaries

January 1,2021 to December 31,2021
ble 5
Number
(Note 1)
1
1
1
1
1
1
1
1
1
1
1
1
2
2
2
2
2
2
2
3
3
4		 Name
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden SF CORP.
Holiday Garden SF CORP.
Holiday Garden VC CORP.		 Counterparty
Relationship with
the counterparty
(Note 2)
Holiday Garden U.S.
(3)
Holiday Garden U.S.
(3)
Holiday Garden SF CORP.
(3)
Holiday Garden SF CORP.
(3)
Holiday Garden NW CORP.
(3)
Holiday Garden NW CORP.
(3)
Holiday Garden VC CORP.
(3)
Holiday Garden VC CORP.
(3)
Holiday Garden WC CORP.
(3)
Holiday Garden WC CORP.
(3)
Holiday Garden EV CORP.
(3)
Holiday Garden EV CORP.
(3)
Holiday Garden NW CORP.
(3)
Holiday Garden WC CORP.
(3)
Holiday Garden WC CORP.
(3)
Holiday Garden VC CORP.
(3)
Holiday Garden EV CORP.
(3)
Holiday Garden EV CORP.
(3)
Holiday Garden FM CORP.
(3)
Holiday Garden U.S.
(3)
Holiday Garden U.S.
(3)
Holiday Garden SF CORP.
(3)		 Unit: NT$1,000
(Unless otherwise noted)
Transaction condition
Transaction conditions
Ratio to consolidated
total revenue or
totalassets (Note 3)
Processed according to the agreement
between the two parties
12.36%
Processed according to the agreement
between the two parties
7.25%
Processed according to the agreement
between the two parties
0.29%
Processed according to the agreement
between the two parties
1.48%
Processed according to the agreement
between the two parties
0.29%
Processed according to the agreement
between the two parties
1.48%
Processed according to the agreement
between the two parties
0.29%
Processed according to the agreement
between the two parties
1.48%
Processed according to the agreement
between the two parties
0.29%
Processed according to the agreement
between the two parties
1.48%
Processed according to the agreement
between the two parties
0.24%
Processed according to the agreement
between the two parties
1.48%
Processed according to the agreement
between the two parties
0.96%
Processed according to the agreement
between the two parties
5.41%
Processed according to the agreement
between the two parties
2.97%
Processed according to the agreement
between the two parties
0.48%
Processed according to the agreement
between the two parties
7.91%
Processed according to the agreement
between the two parties
4.42%
Processed according to the agreement
between the two parties
5.66%
Processed according to the agreement
between the two parties
4.27%
Processed according to the agreement
between the two parties
1.27%
Processed according to the agreement
between the two parties
0.63%


Account
Amount
$1,063,466
61,902
24,912
12,605
24,912
12,605
24,912
12,605
24,912
12,605
20,760
12,605
83,040
465,301
25,349
41,520
680,478
37,779
487,608
367,784
10,840
54,225
Other accounts receivable
Interest income
Other income
Interest income
Other income
Interest income
Other income
Interest income
Other income
Interest income
Other income
Interest income
Other income
Other income
Interest income
Other income
Other income
Interest income
Other income
Other income
Interest income
Other income		 
Table 5

~78~
5 Holiday Garden NW CORP. Holiday Garden SF CORP. (3) Other income 25,565 Processed according to the agreement 0.30%
between the two parties
6 Holiday Garden WC CORP. Holiday Garden SF CORP. (3) Other income 141,205 Processed according to the agreement 1.65%
between the two parties
7 Holiday Garden EV CORP. Holiday Garden SF CORP. (3) Other income 125,684 Processed according to the agreement 1.46%
between the two parties
8 Holiday Garden FM CORP. Holiday Garden SF CORP. (3) Other income 57,281 Processed according to the agreement 0.67%
between the two parties 
Note 1: Business transaction information between the parent company and its subsidiaries should be coded in the coding section, and the coding is described below.

(1)0 for the parent company.

(2)For the subsidiaries, they are coded starting from 1 based on the company

Note2: There are the following three types of relationship with counterparties, and only the type is specified (one disclosure for the same transaction between the parent company and a subsidiary or
among subsidiaries). For example, for a transaction between the parent company and a subsidiary, if the parent company has already disclosed it, there is no need for the subsidiary to disclose the same
transaction again. For transactions among subsidiaries, if one subsidiary has disclosed it already, then there is no need for the other subsidiary to disclose it again.)

(1)The parent company to a subsidiary

(2)A subsidiary to the parent company

(3) A subsidiary to another subsidiary

Note 3: Regarding the ratio of transaction amount to consolidated total operating revenues or total assets, it is computed based on the closing balance to consolidated total assets for balance sheet
accounts,

and as for income statement accounts, it is based on accumulated amount to consolidated total operating revenue

Note 4: The significant transaction conditions summarized in this table are transactions of an amount greater than NT$ 5 million or 20% of the paid-in capital of the parent company.

~79~

Holiday Garden International Ltd. and subsidiaries

The investee's name, location, and other related information (excluding investees in mainland China)
January 1,2021 to December 31,2021
Table 6
Investor
Investee
(Notes 1 and 2)
Holiday Garden Hotel
Co., Ltd
Holiday Garden
Development Ltd.
Holiday Garden Hotel
Co., Ltd
Holiday Garden
International Ltd.
Holiday Garden
International Ltd.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden SF
CORP.
Holiday Garden U.S.
Holiday Garden NW
CORP.
Holiday Garden U.S.
Holiday Garden VC
CORP.
Holiday Garden U.S.
Holiday Garden WC
CORP.
Holiday Garden U.S.
Holiday Garden EV
CORP.
Holiday Garden U.S.
Holiday Garden FM
CORP.		 Location
Primary
business items
Taiwan
Tourism hotels
Bermuda
Investment
business
USA
Investment
business
USA
Tourism hotels
USA
Tourism hotels
USA
Tourism hotels
USA
Tourism hotels
USA
Tourism hotels
USA
Tourism hotels
Initial investment amount
Ending of
reporting period
Previous year end
$ 65,000
$ 65,000
977,650
642,980
585,961
251,291
84,662
84,662
81,250
81,250
81,250
81,250
80,700
80,700
77,188
77,188
69,263
-
Initial investment amount
Ending of
reporting period
Previous year end
$ 65,000
$ 65,000
977,650
642,980
585,961
251,291
84,662
84,662
81,250
81,250
81,250
81,250
80,700
80,700
77,188
77,188
69,263
-		 Unit: NT$1,000
(Unless otherwise noted)
End of the reporting period
Investee’s current
profit and loss
(Notes 2(2))
Recognized current
investment gain or
loss (Note 2(3))
Note
Number of
shares
Ratio
Carrying amount
6,500
100
$
36,485
($ 11,364)
($ 11,364)
The
Company's
subsidiary
12,000
100
1,492,819
( 88,773 )
( 88,773 )
The
Company's
subsidiary
18,000
100
238,493
( 125,434 )
( 125,434 )
The
Company's
subsidiary
170,000
100
136,867
8,852
8,852
The
Company's
subsidiary
150,000
100
22,981
( 15,573 )
( 15,573 )
The
Company's
subsidiary
150,000
100
( 23,686)
( 10,690 )
( 10,690 )
The
Company's
subsidiary
150,000
100
( 207,437)
( 55,661 )
( 55,661 )
The
Company's
subsidiary
150,000
100
( 240,695)
( 83,189 )
( 83,189 )
The
Company's
subsidiary
150,000
100
58,430
59,127
59,127
The
Company's
subsidiary

Ending of
reporting period
$ 65,000
977,650
585,961
84,662
81,250
81,250
80,700
77,188
69,263






$ 65,000
642,980
251,291
84,662
81,250
81,250
80,700
77,188
-		 
Note 1: For a publicly company with an overseas holding company and using the consolidated financial report as the major financial report in compliance with local laws and regulations,
the disclosure of information of overseas investees can be limited to information related to the holding company.

Note 2: If the circumstances described in Note 1 are not applicable, please enter the following information:

(1)For the name of the investee, the location, the primary business items, the initial investment amount, and shareholding at the end of the period, they should be filled out in sequence according to the

reinvestment of the Company (a publicly listed company) and each reinvestment of each direct or indirect controlled investee. In addition, the relationship 

 (e.g., a subsidiary or a subsidiary-subsidiary of the parent company) between each investee and the Company (a publicly listed company) should be entered.

(2) For the section of “investee ’ s profit and loss, ” please enter the amount of current profit and loss of each investee.

(3) For “Recognized current investment income, ” enter only the recognized amount of profit and loss of each direct investment subsidiary of the Company (a publicly listed company) and of each investee

f accounted or using the equity method. The balance is not required. When entering the “Amount of profit and loss recognized of each subsidiary of direct reinvestment, ” subsidiary of the Company (a publicly listed company) and of each investee accounted for using the equity method. The balance is not required. When entering the “Amount of profit and loss recognized of each subsidiary of direct reinvestment, ” make sure that the amount of profit or loss of each subsidiary includes the investment income of the reinvestment to be recognized in accordance with the regulations. 

~80~

Holiday Garden Hotel Co., Ltd

Table 7

Major Shareholder Information January 1,2021 to December 31,2021

                             Shares
                                             Main shareholder name                                                                                  Shares held               Shareholding ratio
YENJUAN INTERNATIONAL CO., LTD.                                                                                                                       21,427,377                             19.39%
CATHAY UNITED BANK is entrusted with custody of GIPPER CO., LTD. investment account                                                                   10,908,482                              9.87%
CATHAY UNITED BANK is entrusted with custody of ESSIDIY Co., Ltd. investment account                                                                  10,485,338                              9.49%
CATHAY UNITED BANK is entrusted with custody of CHUN TAO KOO (HOLDINGS) LTD. investment account                                                       10,361,288                              9.37%
CATHAY UNITED BANK is entrusted with custody of KDX HOLDING LTD. investment account                                                                    8,748,960                              7.91%

~81~

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