English Translation of a Report and Consolidated Financial Statements Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS WITH REPORT OF INDEPENDENT AUDITORS FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2023 AND 2022

Notice to Readers

The reader is advised that these consolidated financial statements have been prepared originally in Chinese. In the event of a conflict between these financial statements and the original Chinese version or difference in interpretation between the two versions, the Chinese language financial statements shall prevail.

Independent Auditors’ Review Report Translated from Chinese

To ITE Tech. Inc.

Introduction

We have reviewed the accompanying consolidated balance sheets of ITE Tech. Inc. and its subsidiaries ( the “Group” ) as of June 30, 2023 and 2022, the related consolidated statements of comprehensive income for the three-month and six-month periods ended June 30, 2023 and 2022 and consolidated statements of changes in equity and cash flows for the six-month periods ended June 30, 2023 and 2022, and notes to the consolidated financial statements, including the summary of significant accounting policies (together “the consolidated financial statements”). Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard No.34, “Interim Financial Reporting” as endorsed and became effective by Financial Supervisory Commission of the Republic of China. Our responsibility is to express a conclusion on these consolidated financial statements based on our reviews.

Scope of Review

Except as explained in the following paragraph, we conducted our reviews in accordance with the Standard on Review Engagements 2410, “Review of Financial Information Performed by the Independent Auditor of the Entity” of the Republic of China. A review of consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with the Standards on Auditing of the Republic of China and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Basis for Qualified Conclusion

As explained in Note 4(3), the financial statements of certain insignificant subsidiaries were not reviewed by independent auditors. Those statements reflect total assets of NT$7,325 thousand and NT$12,733 thousand, constituting 0.09% and 0.15% of the consolidated total assets, and total liabilities of NT$4,475 thousand and NT$8,168 thousand, constituting 0.17% and 0.25% of the consolidated total liabilities as of June 30, 2023 and 2022, respectively; and total comprehensive income (loss) of NT$(872) thousand, NT$(411) thousand, NT$433 thousand and NT$2,084 thousand, constituting (0.18)%, (0.59)% , 0.04% and 1.19% of the consolidated total comprehensive income for the three- month and six-month periods ended June 30, 2023 and 2022, respectively. And as explained in Note 6(8), the financial statements of certain associates and joint ventures accounted for under the equity method were not reviewed by independent auditors. Those associates and joint ventures under equity method amounted to NT$16,633 thousand and NT$10,649 thousand as of June 30, 2023 and 2022, respectively. The related shares of profit or loss from the associates and joint ventures under the equity method amounted to NT$(1,987) thousand, NT$(655) thousand, NT$(4,936) thousand and NT$(2,645) thousand for the three-month and six-month periods ended June 30, 2023 and 2022, respectively. The information related to above subsidiaries and the associate accounted for under the equity method disclosed in Note 13 was also not reviewed by independent auditors.

Qualified Conclusion

Based on our reviews, except for the effect of such adjustments, if any, as might have been determined to be necessary had the financial statements of certain insignificant subsidiaries and the associate accounted for using the equity method and the information disclosed in the footnotes been reviewed by independent auditors described in the preceding paragraph, nothing has come to our attention that causes us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of ITE Tech. Inc. and its subsidiaries as of June 30, 2023 and 2022, and their consolidated financial performance for the three-month and sixmonth periods ended June 30, 2023 and 2022, and their consolidated cash flows for the six-month periods ended June 30, 2023 and 2022, in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard No. 34, “Interim Financial Reporting” as endorsed and became effective by Financial Supervisory Commission of the Republic of China.

Hu, Shen-Chieh

Hsu, Hsin-Min

Ernst & Young, Taiwan

August 9, 2023

Notice to Readers

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

Accordingly, the accompanying consolidated financial statements and report of independent auditors are not intended for use by those who are not informed about the accounting principles or Standards on Auditing of the Republic of China, and their applications in practice. As the consolidated financial statements are the responsibility of the management, Ernst & Young cannot accept any liability for the use of, or reliance on, the English translation or for any errors or

misunderstandings that may derive from the translation.

English Translation of Consolidated Financial Statements Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

June 30, 2023, December 31, 2022 and June 30, 2022

(Expressed in Thousands of New Taiwan Dollars)

ASSETS	Notes			As of
		June 30, 2023		December 31,	2022	June 30, 2022
Current assets Cash and cash equivalents Financial assets at fair value through profit or loss-current Financial assets measured at amortized cost-current Notes receivables, net Trade receivables, net Trade receivables from related parties, net Other receivables Inventories, net Prepayments Other current assets Total current assets Non-current assets Financial assets at fair value through profit or loss-noncurrent Financial assets at fair value through other comprehensive income-noncurrent Financial assets measured at amortized cost-noncurrent Investments accounted for using the equity method Property, plant and equipment Right-of-use assets Intangible assets Deferred tax assets Other non-current assets Total non-current assets Total assets	6(1) 6(2) 6(4),8 6(5),6(15) 6(6),6(15) 6(6),6(15),7 6(7) 6(2) 6(3) 6(4),8 6(8) 6(9) 6(16) 6(10) 4,6(20)	$3,579,878 - 2,200 8,649 1,037,081 1,210 4,918 820,323 60,661 29	43.88 - 0.03 0.11 12.71 0.01 0.06 10.05 0.74 -	$1,785,488 663,670 - 8,665 717,584 - 1,391 1,071,211 74,262 129	26.77 9.95 - 0.13 10.76 - 0.02 16.06 1.12 -	$1,911,902 1,736,378 - 15,535 772,699 - 966 1,343,684 57,229 122	22.98 20.87 - 0.19 9.29 - 0.01 16.15 0.69 -
		5,514,949	67.59	4,322,400	64.81	5,838,515	70.18
		138,744 1,397,177 4,230 16,633 630,268 83,804 282,398 88,227 2,497	1.70 17.13 0.05 0.20 7.73 1.03 3.46 1.08 0.03	88,835 1,154,912 4,230 8,278 629,367 84,549 282,553 91,491 2,826	1.33 17.32 0.06 0.12 9.44 1.27 4.24 1.37 0.04	70,200 1,299,991 4,230 10,649 639,441 88,491 224,015 87,387 56,124	0.84 15.63 0.05 0.13 7.69 1.06 2.69 1.05 0.68
		2,643,978	32.41	2,347,041	35.19	2,480,528	29.82
		$8,158,927	100.00	$6,669,441	100.00	$8,319,043	100.00

(The accompanying notes are an integral part of the consolidated financial statements.)

English Translation of Consolidated Financial Statements Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

June 30, 2023, December 31, 2022 and June 30, 2022

(Expressed in Thousands of New Taiwan Dollars)

LIABILITIES AND EQUITY	Notes			As of
		June 30,2023		December 31,	2022	June 30,2022
Current liabilities Contract liabilities-current Trade payables Trade payables to related parties Other payables Other payables to related parties Current tax liabilities Lease liabilities-current Other current liabilities Total current liabilities Non-current liabilities Deferred tax liabilities Lease liabilities-noncurrent Net defined benefit liabilities-noncurrent Deposits received Total non-current liabilities Total liabilities Equity attributable to owners of the parent Share capital Common stock Capital surplus Retained earnings Legal reserve Undistributed earnings Other equity Total equity Total liabilities and equity	6(14) 7 7 4,6(20) 6(16) 6(11) 4,6(20) 6(16) 4,6(12) 6(13) 6(13) 6(13)	$12,800 381,728 169,846 1,481,315 13,040 241,760 7,748 164,826	0.16 4.68 2.08 18.16 0.16 2.96 0.09 2.02	$11,887 257,378 109,850 472,151 6,565 113,039 6,860 119,833	0.18 3.86 1.65 7.08 0.10 1.69 0.10 1.80	$4,906 331,962 260,563 2,091,863 14,718 238,401 7,005 183,187	0.06 3.99 3.13 25.15 0.18 2.87 0.08 2.20
		2,473,063	30.31	1,097,563	16.46	3,132,605	37.66
		356 79,226 82,575 28,290	0.01 0.97 1.01 0.35	- 80,633 83,535 28,290	- 1.21 1.25 0.42	49 84,157 86,862 28,483	- 1.01 1.04 0.34
		190,447	2.34	192,458	2.88	199,551	2.39
		2,663,510	32.65	1,290,021	19.34	3,332,156	40.05
		1,610,801 1,229,824 710,912 1,535,380 408,500	19.74 15.07 8.71 18.82 5.01	1,610,801 1,297,073 588,175 1,731,439 151,932	24.15 19.45 8.82 25.96 2.28	1,610,801 1,297,073 588,175 1,209,845 280,993	19.36 15.59 7.07 14.55 3.38
		5,495,417	67.35	5,379,420	80.66	4,986,887	59.95
		$8,158,927	100.00	$6,669,441	100.00	$8,319,043	100.00

(The accompanying notes are an integral part of the consolidated financial statements.)

English Translation of Consolidated Financial Statements Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the three-month and six-month periods ended June 30, 2023 and 2022

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

Description	Notes	For the	three-month periods ended June 30,	three-month periods ended June 30,	three-month periods ended June 30,	For th	e six-month periods ended June 30,	e six-month periods ended June 30,
		2023		2022		2023		2022
Operating revenues Operating costs Gross profit Operating expenses Selling expenses Administrative expenses Research and development expenses Total operating expenses Operating income Non-operating income and expenses Interest income Other income Other gains and losses Finance costs Share of loss of associates and joint ventures accounted for using the equity method Total non-operating income and expenses Net income before income tax Income tax expense Net income Other comprehensive income (loss) Items that may not be reclassified subsequently to profit or loss Unrealized gains (losses) from equity instrument investments measured at fair value through other comprehensive income Income tax relating to those items not to be reclassified to profit or loss Items that may be reclassified subsequently to profit or loss Exchange differences resulting from translating the financial statements of foreign operations Other comprehensive income (loss), net of tax Total comprehensive income Net income for the periods attributable to: Owners of the parent Total comprehensive income for the periods attributable to: Owners of the parent Earning per share (in New Taiwan Dollars) Basic earnings per share (in New Taiwan Dollars) Diluted earnings per share (in New Taiwan Dollars)	6(14),7 6(7),6(16),6(17),7 6(16),6(17),7 6(18) 6(18) 6(18) 6(8) 4,6(20) 6(19) 6(21)	$1,711,064 (766,115)	100.00 (44.77)	$1,372,482 (637,719)	100.00 (46.46)	$3,032,133 (1,350,757)	100.00 (44.55)	$2,983,281 (1,396,222)	100.00 (46.80)
		944,949	55.23	734,763	53.54	1,681,376	55.45	1,587,059	53.20
		(96,914) (76,007) (242,711)	(5.66) (4.44) (14.19)	(87,502) (56,081) (212,212)	(6.38) (4.09) (15.46)	(177,922) (134,303) (452,805)	(5.87) (4.43) (14.93)	(181,442) (125,171) (443,235)	(6.08) (4.20) (14.86)
		(415,632)	(24.29)	(355,795)	(25.93)	(765,030)	(25.23)	(749,848)	(25.14)
		529,317	30.94	378,968	27.61	916,346	30.22	837,211	28.06
		8,140 9,234 8,634 (404) (1,987)	0.48 0.54 0.50 (0.02) (0.12)	1,707 4,240 (2,389) (450) (655)	0.12 0.31 (0.17) (0.03) (0.05)	12,070 10,363 6,683 (822) (4,936)	0.40 0.34 0.22 (0.03) (0.16)	2,473 29,229 (8,876) (911) (2,645)	0.08 0.98 (0.29) (0.03) (0.09)
		23,617	1.38	2,453	0.18	23,358	0.77	19,270	0.65
		552,934 (115,505)	32.32 (6.75)	381,421 (86,311)	27.79 (6.29)	939,704 (160,330)	30.99 (5.29)	856,481 (156,817)	28.71 (5.26)
		437,429	25.57	295,110	21.50	779,374	25.70	699,664	23.45
		43,004 (640) (103)	2.51 (0.04) (0.01)	(229,758) 4,028 (57)	(16.74) 0.29 -	291,758 (1,864) (81)	9.62 (0.06) -	(532,017) 7,748 62	(17.83) 0.26 -
		42,261	2.46	(225,787)	(16.45)	289,813	9.56	(524,207)	(17.57)
		$479,690	28.03	$69,323	5.05	$1,069,187	35.26	$175,457	5.88
		$437,429		$295,110		$779,374		$699,664
		$479,690		$69,323		$1,069,187		$175,457
		$2.72		$1.83		$4.84		$4.34
		$2.70		$1.81		$4.79		$4.26

(The accompanying notes are an integral part of the consolidated financial statements. )

English Translation of Consolidated Financial Statements Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For the six-month periods ended June 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars)

Description			Equityattributable t	Equityattributable t	o owners of theparent			Total equity
	Share capital	Capital surplus	Retained	Earnings	Other	equity	O Equity attributable to owners of the parent
			Legal reserve	Undistributed earnings	Exchange differences resulting from translating the financial statements of foreign operations	Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income
Balance as of January 1, 2022 Appropriation and distribution of 2021 earnings: Legal reserve Cash dividends Changes in other capital surplus Cash dividends distributed from capital surplus Profit for the six-month period ended June 30, 2022 Other comprehensive income (loss) for the six-month period ended June 30, 2022 Total comprehensive income (loss) for the six-month period ended June 30, 2022 Disposal of equity instruments measured at fair value through other comprehensive income Balance as of June 30, 2022 Balance as of January 1, 2023 Appropriation and distribution of 2022 earnings: Legal reserve Cash dividends Changes in other capital surplus	$1,610,801 - - - - -	$1,458,153 - - (161,080) - -	$414,947 173,228 - - - -	$1,965,937 (173,228) (1,288,641) - 699,664 -	$(245) - - - - 62	$811,558 - - - - (524,269)	$6,261,151 - (1,288,641) (161,080) 699,664 (524,207)	$6,261,151 - (1,288,641) (161,080) 699,664 (524,207) 175,457 - $4,986,887 $5,379,420 - (885,941) 13,291 (80,540) 779,374 289,813 1,069,187 - $5,495,417
	- -	- -	- -	699,664 6,113	62 -	(524,269) (6,113)	175,457 -
	$1,610,801	$1,297,073	$588,175	$1,209,845	$(183)	$281,176	$4,986,887
	$1,610,801 - - - - - -	$1,297,073 - - 13,291 (80,540) - -	$588,175 122,737 - - - - -	$1,731,439 (122,737) (885,941) - - 779,374 -	$(206) - - - - - (81)	$152,138 - - - - - 289,894	$5,379,420 - (885,941) 13,291 (80,540) 779,374 289,813
Changes in associates and joint ventures accounted for using the equity method
Cash dividends distributed from capital surplus Profit for the six-month period ended June 30, 2023 Other comprehensive income (loss) for the six-month period ended June 30, 2023 Total comprehensive income (loss) for the six-month period ended June 30, 2023 Disposal of equity instruments measured at fair value through other comprehensive income Balance as of June 30, 2023
	- -	- -	- -	779,374 33,245	(81) -	289,894 (33,245)	1,069,187 -
	$1,610,801	$1,229,824	$710,912	$1,535,380	$(287)	$408,787	$5,495,417

( The accompanying notes are an integral part of the consolidated financial statements. )

English Translation of Consolidated Financial Statements Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS For the six-month periods ended June 30, 2023 and 2022 (Expressed in Thousands of New Taiwan Dollars)

Description	For the six-monthperiods ended June 30	For the six-monthperiods ended June 30	Description	For the six-monthperiods ended June 30	For the six-monthperiods ended June 30
	2023	2022		2023	2022
Cash flows from operating activities: Profit before tax Adjustments for: The profit or loss items which did not affect cash flows: Depreciation Amortization (Gains) Losses on financial assets at fair value through profit or loss Interest expenses Interest income Dividend income Share of loss of associates and joint ventures accounted for using the equity method Changes in operating assets and liabilities: Financial assets mandatorily measured at fair value through profit or loss Notes receivables Trade receivables Trade receivables from related parties Other receivables Inventories Prepayments Other current assets Contract liabilities Trade payables Trade payables to related parties Other payables Other payables to related parties Other current liabilities Net defined benefit liabilities Cash generated from operating activities: Interest received Interest paid Income tax paid Net cash provided by operating activities	$939,704 23,431 5,920 (3,018) 822 (12,070) (9,020) 4,936 666,792 16 (319,497) (1,210) 24 250,888 13,601 100 913 124,350 59,996 42,683 6,475 44,993 (960)	$856,481 22,713 2,780 11,298 911 (2,473) (26,658) 2,645 (200,000) (6,287) 262,240 3,011 (51) (266,796) 14,277 (2) (90) (288,596) (37,624) (56,993) 11,613 743 (996)	Cash flows from investing activities: Acquisition of financial assets at fair value through other comprehensive income Proceeds from disposal of financial assets at fair value through other comprehensive income Proceeds from capital return of financial assets at fair value through other comprehensive income Acquisition of financial assets measured at amortized cost Acquisition of financial assets at fair value through profit or loss Disposal of subsidiary Acquisition of property, plant and equipment Acquisition of intangible assets Decrease in other non-current assets Increase in prepayments for equipment Dividends received Net cash used in investing activities Cash flows from financing activities: Cash payment for the principal portion of the lease liabilities Net cash used in financing activities Effect of exchange rate changes on cash and cash equivalents Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of period Cash and cash equivalents at the end of period	(37,500) 36,993 50,000 (2,200) (50,013) - (20,430) (5,782) 329 - 9,020	- 6,950 - - (53,092) 5,378 (11,837) (4,595) 384 (49,274) 26,658
				(19,583)	(79,428)
				(3,808)	(3,356)
				(3,808)	(3,356)
				68	(166)
	1,839,869	302,146
	8,519 (822) (29,853)	2,742 (911) (285,050)
				1,794,390 1,785,488	(64,023) 1,975,925
	1,817,713	18,927		$3,579,878	$1,911,902

(The accompanying notes are an integral part of the consolidated financial statements.)

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

For the Six-Month Periods Ended June 30, 2023 and 2022

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

1. Organization and Operation

ITE Tech. Inc. (“the Company”) was incorporated in Hsinchu Science Park on May 29, 1996. The Company’s main products are Super I/O control (SIO) ICs for desktop computers, embedded control (EC) ICs for notebook computers, high-speed audio-video interface related ICs, system on a chip (SoC), and other customized application chips. The Company’s shares are traded in Taiwan Stock Exchange. The Company’s registered office and the main business location is at 3F, No.13, Innovation Road I, Hsinchu Science Park, Hsinchu City.

2. Date and Procedures of Authorization of Financial Statements for Issue

The consolidated financial statements of the Company and its subsidiaries (the “Group”) were authorized for issue by the Board of Directors on August 9, 2023.

3. Newly Issued or Revised Standards and Interpretations

(1) Changes in accounting policies resulting from applying for the first time certain standards and amendments

The Group applied for the first time International Financial Reporting Standards, International Accounting Standards, and Interpretations issued, revised or amended which are endorsed by Financial Supervisory Commission (“FSC”) and become effective for annual periods beginning on or after January 1, 2023. The application of these new standards and amendments had no material effect on the Group.

(2) Standards or interpretations issued, revised, or amended, by International Accounting Standards Board (“IASB”) which are not endorsed by FSC, and not yet adopted by the Group as at the end of the reporting period are listed below.

Items	New, Revised or Amended Standards and Interpretations	Effective Date issued byIASB
a	IFRS 10 “Consolidated Financial Statements” and IAS 28 “Investments in Associates and Joint Ventures” – Sale or Contribution of Assets between an Investor and its Associate orJoint Ventures	To be determined by IASB
b	IFRS 17 “Insurance Contracts”	January 1, 2023
c	Classification of Liabilities as Current or Non-current – Amendments to IAS 1	January 1, 2024
d	Lease Liability in a Sale and Leaseback – Amendments to IFRS 16	January 1, 2024

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Items	New, Revised or Amended Standards and Interpretations	Effective Date issued byIASB
e	Non-current Liabilities with Covenants – Amendments to IAS1	January 1, 2024
f	International Tax Reform – Pillar Two Model Rules– Amendments toIAS12	January 1, 2023
g	Supplier Finance Arrangements – Amendments to IAS 7 and IFRS 7	January 1, 2024

(a) IFRS 10 “Consolidated Financial Statements” and IAS 28 “Investments in Associates and Joint Ventures” – Sale or Contribution of Assets between an Investor and its Associate or Joint Ventures

The amendments address the inconsistency between the requirements in IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and Joint Ventures, in dealing with the loss of control of a subsidiary that is contributed to an associate or a joint venture. IAS 28 restricts gains and losses arising from contributions of non-monetary assets to an associate or a joint venture to the extent of the interest attributable to the other equity holders in the associate or joint ventures. IFRS 10 requires full profit or loss recognition on the loss of control of the subsidiary. IAS 28 was amended so that the gain or loss resulting from the sale or contribution of assets that constitute a business as defined in IFRS 3 between an investor and its associate or joint venture is recognized in full.

IFRS 10 was also amended so that the gain or loss resulting from the sale or contribution of a subsidiary that does not constitute a business as defined in IFRS 3 between an investor and its associate or joint venture is recognized only to the extent of the unrelated investors’ interests in the associate or joint venture.

(b) IFRS 17 “Insurance Contracts”

IFRS 17 provides a comprehensive model for insurance contracts, covering all relevant accounting aspects (including recognition, measurement, presentation and disclosure requirements). The core of IFRS 17 is the General (building block) Model, under this model, on initial recognition, an entity shall measure a group of insurance contracts at the total of the fulfilment cash flows and the contractual service margin. The carrying amount of a group of insurance contracts at the end of each reporting period shall be the sum of the liability for remaining coverage and the liability for incurred claims.

Other than the General Model, the standard also provides a specific adaptation for contracts with direct participation features (the Variable Fee Approach) and a simplified approach (Premium Allocation Approach) mainly for short-duration contracts.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

IFRS 17 was issued in May 2017 and it was amended in 2020 and 2021. The amendments include deferral of the date of initial application of IFRS 17 by two years to annual beginning on or after January 1, 2023 (from the original effective date of January 1, 2021); provide additional transition reliefs; simplify some requirements to reduce the costs of applying IFRS 17 and revise some requirements to make the results easier to explain. IFRS 17 replaces an interim Standard – IFRS 4 Insurance Contracts – from annual reporting periods beginning on or after January 1, 2023.

These are the amendments to paragraphs 69-76 of IAS 1 Presentation of Financial statements and the amended paragraphs related to the classification of liabilities as current or non-current.

(d) Lease Liability in a Sale and Leaseback – Amendments to IFRS 16

The amendments add seller-lessee additional requirements for the sale and leaseback transactions in IFRS 16, thereby supporting the consistent application of the standard.

(e) Non-current Liabilities with Covenants – Amendments to IAS 1

The amendments improved the information companies provide about long-term debt with covenants. The amendments specify that covenants to be complied within twelve months after the reporting period do not affect the classification of debt as current or non-current at the end of the reporting period.

(f) International Tax Reform – Pillar Two Model Rules – Amendments to IAS 12

The amendments introduced a temporary exception to the requirements to recognize and disclose information about deferred tax assets and liabilities related to Pillar Two income taxes; and targeted disclosure requirements for affected entities. An entity is not required to disclose the information required for any interim period ending on or before December 31, 2023.

(g) Supplier Finance Arrangements – Amendments to IAS 7 and IFRS 7

The amendments introduced additional information of supplier finance arrangements and added disclosure requirements for such arrangements.

The abovementioned standards and interpretations issued by IASB have not yet endorsed by FSC at the date when the Group’s financial statements were authorized for issue, the local effective dates are to be determined by FSC. The aforementioned standards and interpretations have no material impact on the Group.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

4. Summary of Significant Accounting Policies

(1) Statement of compliance

The consolidated financial statements of the Group for the six-month periods ended June 30, 2023 and 2022 have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers (“the Regulations”) and IAS 34 Interim Financial Reporting as endorsed and became effective by FSC.

(2) Basis of preparation

The consolidated financial statements have been prepared on a historical cost basis, except for financial instruments that have been measured at fair value. The consolidated financial statements are expressed in thousands of New Taiwan Dollars (“NT$”) unless otherwise stated.

(3) Basis of consolidation

Preparation principle of consolidated financial statements

Control is achieved when the Company is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Company controls an investee if and only if the Company has:

(a) power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee)
(b) exposure, or rights, to variable returns from its involvement with the investee, and
(c) the ability to use its power over the investee to affect its returns

When the Company has less than a majority of the voting or similar rights of an investee, the Company considers all relevant facts and circumstances in assessing whether it has power over an investee, including:

(a) the contractual arrangement with the other vote holders of the investee
(b) rights arising from other contractual arrangements
(c) the Company’s voting rights and potential voting rights

The Company re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Subsidiaries are fully consolidated from the acquisition date, being the date on which the Company obtains control, and continue to be consolidated until the date that such control ceases. The financial statements of the subsidiaries are prepared for the same reporting period as the parent company, using uniform accounting policies. All intra-group balances, income and expenses, unrealized gains and losses and dividends resulting from intra-group transactions are eliminated in full.

A change in the ownership interest of a subsidiary, without a change of control, is accounted for as an equity transaction.

Total comprehensive income of the subsidiaries is attributed to the owners of the parent and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

If the Company loses control of a subsidiary, it:

(a) derecognizes the assets (including goodwill) and liabilities of the subsidiary;
(b) derecognizes the carrying amount of any non-controlling interest;
(c) recognizes the fair value of the consideration received;
(d) recognizes the fair value of any investment retained;
(e) reclassifies the parent’s share of components previously recognized in other comprehensive income to profit or loss, or transfers directly to retained earnings in accordance with other International Financial Reporting Standards ; and
(f) recognizes differences in profit or loss.

The consolidated entity is listed as follows:

Investor	Subsidiary	Main businesses		Percentage ofownership	Percentage ofownership	Percentage ofownership
				June 30, 2023	December 31, 2022	June 30, 2022
ITE Tech. Inc.	ITE Tech. (Shenzhen) Inc.	Technological consultation services for ICs products		100.00%	100.00%	100.00%

The financial statements of the consolidated subsidiary listed above had not been reviewed by independent auditors. As of June 30, 2023 and 2022, the related asset of the subsidiary is NT$7,325 thousand and NT$12,733 thousand, respectively, and the related liability is NT$4,475 thousand and NT$8,168 thousand, respectively. The comprehensive income (loss) of the subsidiary is NT$(872) thousand, NT$(411) thousand, NT$433 thousand and NT$2,084 thousand for the three-month and six-month periods ended June 30, 2023 and 2022, respectively.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(4) Except for the accounting policies listed in Note 4(5) to 4(6), the same accounting policies have been followed in the consolidated financial statements for the six-month period ended June 30, 2023 as were applied in the preparation of the Group’s consolidated financial statements for the year ended December 31, 2022. For the summary of other significant accounting policies, please refer to the consolidated financial statements for the year ended December 31, 2022.
(5) Post-employment benefits

Pension cost for an interim period is calculated on a year-to-date basis by using the actuarially determined pension cost rate at the end of the prior financial year, adjusted and disclosed for significant market fluctuations since that time and for significant curtailments, settlements, or other significant one-off events.

(6) Income taxes

Interim period income tax expense is accrued using the tax rate that would be applicable to expected total annual earnings, that is, the estimated average annual effective income tax rate applied to the pre-tax income of the interim period.

5. Significant Accounting Judgments, Estimates and Assumptions

The same significant accounting judgments, estimates and assumptions have been followed in the consolidated financial statements for the six-month periods ended June 30, 2023 and 2022 as were applied in the preparation of the Group’s consolidated financial statements for the year ended December 31, 2022. Please refer to the consolidated financial statements for the year ended December 31 2022.

6. Contents of Significant Accounts

(1) Cash and cash equivalents

	As of
June 30, 2023	December 31, 2022	June 30, 2022
$287 786,041 2,793,550	$267 328,408 1,456,813	$265 731,637 1,180,000
$3,579,878	$1,785,488	$1,911,902

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

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

	As of
June 30, 2023	December 31, 2022 $687,419 65,086 $752,505 $663,670 88,835 $752,505	June 30, 2022
$30,546 108,198		$1,762,147 44,431
$138,744		$1,806,578
$- 138,744		$1,736,378 70,200
$138,744		$1,806,578

Financial assets at fair value through profit or loss were not pledged.

(3) Financial assets at fair value through other comprehensive income, non-current

	As of
June 30, 2023	December 31, 2022	June 30, 2022
$292,462 1,104,715	$200,942 953,970	$298,913 1,001,078
$1,397,177	$1,154,912	$1,299,991

Financial assets at fair value through other comprehensive income were not pledged.

The Group’s dividend income related to equity instrument investments measured at fair value through other comprehensive income is as follows:

For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
2023	2022	2023	2022
$9,020 -	$3,350 -	$9,020 -	$26,658 -
$9,020	$3,350	$9,020	$26,658

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

In consideration of the Group’s investment strategy, the Group disposed and derecognized certain equity instrument investments measured at fair value through other comprehensive income. Details on derecognition of such investments are as follows:

The fair value of the investments at the date of derecognition The cumulative gain on disposal reclassified from other equity to retained earnings	For the six-month periods ended June 30,	For the six-month periods ended June 30,
	2023	2022
	$36,993 $33,245	$6,950 $6,113

(4) Financial assets measured at amortized cost

	As of
June 30, 2023	December 31, 2022	June 30, 2022
$6,430	$4,230	$4,230
$2,200 4,230	$- 4,230 $4,230	$- 4,230
$6,430		$4,230

The Group classified certain financial assets as financial assets measured at amortized cost. Since credit risk is low, expected credit losses during the duration are not significant. Please refer to Note 8 for more details on financial assets measured at amortized cost under pledge and Note 12 for more details on credit risk.

(5) Notes receivables

	As of
June 30, 2023	December 31, 2022	June 30, 2022
$8,649 -	$8,665 -	$15,535 -
$8,649	$8,665	$15,535

Notes receivables were not pledged.

The Group follows the requirement of IFRS 9 to assess the impairment. Please refer to Note 6(15) for more details on loss allowance and Note 12 for more details on credit risk.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(6) Trade receivables and trade receivables from related parties

		As of
	June 30,	December	31,	June 30,
	2023	2022		2022
Trade receivables	$1,037,081	$717,584		$772,699
Less: loss allowance	-		-	-
Subtotal	1,037,081	717,584		772,699
Trade receivables from related parties	1,210		-	-
Less: loss allowance	-		-	-
Subtotal	1,210		-	-
Total	$1,038,291	$717,584		$772,699

Trade receivables and trade receivables from related parties were not pledged.

Trade receivables are generally on 30-90 day terms. The total carrying amounts were NT$$1,038,291 thousand, NT$717,584 thousand and NT$772,699 thousand as of June 30, 2023, December 31, 2022 and June 30, 2022, respectively. Please refer to Note 6(15) for more details on impairment of trade receivables and Note 12 for more details on credit risk.

(7) Inventories

	As of
June 30, 2023	December 31, 2022	June 30, 2022
$5,831 463,487 351,005	$5,672 663,580 401,959	$11,179 681,204 651,301
$820,323	$1,071,211	$1,343,684

The cost of inventories recognized in expenses amounted to NT$766,115 thousand and NT$637,719 thousand for the three-month periods ended June 30, 2023 and 2022, respectively, including the inventory valuation gain (reversal of decline in market value, obsolete and slowmoving inventories) of NT$29,323 thousand and the inventory valuation loss of NT$42,304 thousand for the three-month periods ended June 30, 2023 and 2022, respectively.

The cost of inventories recognized in expenses amounted to NT$1,350,757 thousand and NT$1,396,222 thousand for the six-month periods ended June 30, 2023 and 2022, respectively, including the inventory valuation gain (reversal of decline in market value, obsolete and slowmoving inventories) of NT$49,634 thousand and the inventory valuation loss of NT$51,461 thousand for the six-month periods ended June 30, 2023 and 2022, respectively.

Inventories were not pledged.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(8) Investments accounted for using the equity method

The detail of investments accounted for using the equity method is as follows:

Investee			As of	As of
	June 30,2023		December 31,2022		June 30,2022
	Carrying amount	Percentage of ownership	Carrying amount	Percentage of ownership 36.32%	Carrying amount	Percentage of ownership
Investments in an associate: Emright Technology Co., Ltd.	$16,633	30.15%	$8,278

					$10,649	36.32%

Emright Technology Co., Ltd. increased capital in March 2023, and the Company did not subscribe the new share proportionate to its original ownership interest. Its ownership was therefore reduced to 30.15%.

Although the Group is the largest shareholder of the aforementioned associate; after comprehensive assessment, the Group does not own the major voting rights as the remaining voting rights holders are able to align and prevent the Group from ruling the relevant operation. Therefore, the Group does not control but owns significant influence over the aforementioned associate.

The aggregate amount of the Group’s share of the aforementioned immaterial associate that is accounted for using the equity method is as follows:

For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
2023	2022	2023	2022
$(1,987) -	$(655) -	$(4,936) -	$(2,645) -
$(1,987)	$(655)	$(4,936)	$(2,645)

The Group did not have contingent liabilities or capital commitments to the aforementioned associate and the investment was not pledged as of June 30, 2023, December 31, 2022 and June 30, 2022.

The carrying amount of the associate under equity method amounted to NT$16,633 thousand and NT$10,649 thousand as of June 30, 2023 and 2022, respectively. The related shares of profit or loss from the associate under the equity method amounted to NT$(1,987) thousand, NT$(655) thousand, NT$(4,936) thousand and NT$(2,645) thousand for the three-month and six-month periods ended June 30, 2023 and 2022, respectively. The information related to above associate accounted for under the equity method was not reviewed by independent auditors.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(9) Property, plant and equipment

Land	Buildings	Machinery and equipment	Research and development equipment	Office equipment	Other equipment	Total
$311,450 - - -	$377,001 474 (1,236) -	$41,084 - - -	$49,072 13,560 (1,910) -	$5,813 145 - (166)	$24,499 6,251 (2,969) -	$808,919 20,430 (6,115) (166)
$311,450	$376,239	$41,084	$60,722	$5,792	$27,781	$823,068
$311,450 - - -	$397,969 3,582 (24,710) -	$29,584 11,500 - -	$58,838 2,074 (14,992) -	$6,626 203 (300) 121	$24,230 4,828 (1,597) -	$828,697 22,187 (41,599) 121
$311,450	$376,841	$41,084	$45,920	$6,650	$27,461	$809,406
	$129,252 6,337 (1,236) -	$10,636 3,424 - -	$22,369 6,522 (1,910) -	$5,199 144 - (152)	$12,096 3,088 (2,969) -	$179,552 19,515 (6,115) (152)
$-	$134,353	$14,060	$26,981	$5,191	$12,215	$192,800
$- - - -	$141,408 6,106 (24,710) -	$3,789 3,424 - -	$28,165 5,915 (14,992) -	$5,809 279 (300) 107	$13,461 3,101 (1,597) -	$192,632 18,825 (41,599) 107
$-	$122,804	$7,213	$19,088	$5,895	$14,965	$169,965
$311,450	$241,886	$27,024	$33,741	$601	$15,566	$630,268
$311,450	$247,749	$30,448	$26,703	$614	$12,403	$629,367
$311,450	$254,037	$33,871	$26,832	$755	$12,496	$639,441

(a) Components of buildings with different useful lives are main building structure and air conditioning units, which are depreciated over 41 years and 3 years, respectively.

(b) Property, plant and equipment were not pledged.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(10) Intangible assets

Software	Goodwill	Others	Total
$12,430 3,942 (575) (85)	$2,674,827 - - -	$79,351 1,840 - -	$2,766,608 5,782 (575) (85)
$15,712	$2,674,827	$81,191	$2,771,730
$14,482 1,336 (1,926) 65	$2,674,827 - - -	$12,111 3,732 - -	$2,701,420 5,068 (1,926) 65
$13,957	$2,674,827	$15,843	$2,704,627
$7,943 1,952 (575) (68)	$2,468,504 - - -	$7,608 3,968 - -	$2,484,055 5,920 (575) (68)
$9,252	$2,468,504	$11,576	$2,489,332
$9,294 2,003 (1,926) 45	$2,468,504 - - -	$1,915 777 - -	$2,479,713 2,780 (1,926) 45
$9,416	$2,468,504	$2,692	$2,480,612
$6,460	$206,323	$69,615	$282,398
$4,487	$206,323	$71,743	$282,553
$4,541	$206,323	$13,151	$224,015

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Amortization expenses of intangible assets under the statement of comprehensive income are as follows:

For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
2023	2022	2023	2022
$107	$103	$224	$191
$42	$58	$95	$118
$3,143	$1,295	$5,601	$2,471

(11) Other current liabilities

	As of
June 30, 2023	December 31, 2022	June 30, 2022
$154,553 10,273	$110,939 8,894	$172,200 10,987
$164,826	$119,833	$183,187

(12) Post-employment benefits plans

Defined contribution plan

For the three-month periods ended June 30, 2023 and 2022, the pension expenses recognized under the defined contribution plan are NT$8,117 thousand and NT$7,951 thousand, respectively. For the six-month periods ended June 30, 2023 and 2022, the pension expenses recognized under the defined contribution plan are NT$16,041 thousand and NT$15,310 thousand, respectively.

Defined benefit plan

For the three-month periods ended June 30, 2023 and 2022, the pension expenses recognized under the defined benefit plan are NT$730 thousand and NT$533 thousand, respectively. For the six-month periods ended June 30, 2023 and 2022, the pension expenses recognized under the defined benefit plan are NT$1,460 thousand and NT$1,067 thousand, respectively.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(13) Equity

(a) Common stock

The Company’s authorized capital as of June 30, 2023, December 31, 2022 and June 30, 2022 was NT$2,500,000 thousand divided into 250,000,000 shares (including 30,000,000 shares reserved for exercise of employee stock options at each period), each at a par value of NT$10. The Company’s issued capital was NT$1,610,801 thousand divided into 161,080,124 shares as of June 30, 2023, December 31, 2022 and June 30, 2022. Each share has one voting right and a right to receive dividends.

(b) Capital surplus

	As of
June 30, 2023	December 31, 2022	June 30, 2022
$737,417 191,764 112,008 19,238 16,424 1,977 14,299 136,697	$817,957 191,764 112,008 19,238 16,424 1,977 1,008 136,697	$817,957 191,764 112,008 19,238 16,424 1,977 1,008 136,697
$1,229,824	$1,297,073	$1,297,073

According to the Company Act, the capital surplus shall not be used except for offset a deficit of the company. When a company incurs no loss, it may distribute the capital surplus derived from the issuance of new shares at a premium or income from endowments received by the company. The distribution could be made in cash or in the form of dividend shares to its shareholders in proportion to the number of shares being held by each of them.

(c) Retained earnings and dividend policies

According to the Company’s Articles of Incorporation, current year’s earnings, if any, shall be distributed in the following order:

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

I. Income tax obligation;
II. Offsetting accumulated deficits, if any;
III. Legal reserve at 10% of net income after tax;
IV. Allocation or reverse of special reserves as required by law;
V. After deducting the respective amount specified from item I to IV, at least 50% of the remaining earnings will be distributed, together with the undistributed earnings at the beginning of the period, and the capital surplus. However, if the total distribution divided by all the issued shares is less than NTD$0.1 per share, all the remaining and surplus shall not be distributed.

According to Article 240, Paragraph 5, and Article 241, Paragraph 2 of the Company Act, the Company authorizes the distributable dividends, legal reserve, and capital surplus in whole or in part may be paid in cash after a resolution has been adopted by a majority vote at a meeting of the Board of Directors attended by two-thirds of the total number of directors, and in addition thereto a report of such distribution shall be submitted to the shareholders’ meeting.

The distribution of dividends to shareholders of the company can be paid in cash or shares. The policy of dividend distribution should reflect factors such as the current and future investment environment, fund requirements, domestic and international competition and capital budgets. And the dividends in cash shouldn’t less than 30% of the distributable earnings, as well as the interest of the shareholders, share bonus equilibrium and long-term financial planning etc. The Board of Directors shall make the distribution proposal annually and present it at the shareholders’ meeting.

According to the Company Act, the Company needs to set aside amount to legal reserve unless where such legal reserve amounts to the total paid-in capital. The legal reserve can be used to offset the deficit of the Company. When the Company incurs no loss, it may distribute the portion of legal reserve, which exceeds 25% of the paid-in capital by issuing new shares or by cash in proportion to the number of shares being held by each of the shareholders.

When the Company distributing distributable earnings, it shall set aside to special reserve, an amount equal to other net deductions from shareholders’ equity for the current fiscal year, provided that if the company has already set aside special reserve according to the requirements for the adoption of IFRS, it shall set aside supplemental special reserve based on the difference between the amount already set aside and other net deductions from shareholders’ equity. For any subsequent reversal of other net deductions from shareholders’ equity, the amount reversed may be distributed from the special reserve.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

On March 31, 2021, FSC issued Order No. Financial-Supervisory-Securities-Corporate1090150022, which sets out the following provisions for compliance: On a public company’s first-time adoption of the IFRS, for any unrealized revaluation gains and cumulative translation adjustments (gains) recorded to shareholders’ equity that the company elects to transfer to retained earnings by application of the exemption under IFRS 1, the company shall set aside special reserve. For any subsequent use, disposal or reclassification of related assets, the Company can reverse the special reserve by the proportion of the special reserve first appropriated and distribute it.

The amount of special reserve provided by the Company for the first time in adopting IFRS is nil.

The appropriation of earnings for 2021 was approved by the shareholders’ meeting held on June 21, 2022, while the appropriation of earnings for 2022 was resolved by the Board of Directors’ meeting on February 23, 2023. The details of distribution are as follows:

Appropriation of earnings Dividend per YearsEndedDecember31,	Appropriation of earnings Dividend per YearsEndedDecember31,	Dividend per	share (NT$)

2022	2021 $173,228 1,288,641	2022	2021
$122,737 885,941		$5.5	$8.0

In addition, the Board of Directors’ meeting on February 23, 2023 and the shareholders’ meeting on June 21, 2022 resolved to distribute the capital surplus by cash in the amount of NT$80,540 thousand and NT$161,080 thousand, or NT$0.5 per share and NT$1 per share, respectively.

Note:According to the Company’s Articles of Incorporation, a special resolution was passed at the Board of Directors’ meeting held on February 23, 2023 to distribute the 2022 common stock cash dividends from earnings and capital surplus, and such distribution had been submitted to the shareholders’ meeting in 2023.

Please refer to Note 6(17) for more details on employees’ compensations and the remunerations to directors.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(14) Operating revenues

For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
2023	2022	2023	2022
$1,710,530 534	$1,371,171 1,311	$3,024,359 7,774	$2,981,433 1,848
$1,711,064	$1,372,482	$3,032,133	$2,983,281

Revenue recognition point of the Group is at a point in time. Analysis of revenue from contracts with customers for the six-month periods ended June 30, 2023 and 2022 is as follows:

(a) Contract balances

Contract liabilities – current

Sale of goods		As of	As of
	June 30, 2023	December 31, 2022	June 30, 2022	January 1, 2022
	$12,800	$11,887	$4,906	$4,996

The significant changes in the Group’s balances of contract liabilities for the six-month periods ended June 30, 2023 and 2022 are as follows:

The opening balance transferred to revenue Increase in receipts in advance during the period (deducting the amount incurred and transferred to revenue during the period) Total	For the six-month periods ended June 30,	For the six-month periods ended June 30,
	2023	2022
	$(11,885) 12,798	$(4,996) 4,906
	$913	$(90)

(b) Assets recognized from costs to fulfil a contract

None.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(15) Expected credit gains

Operating expenses – Expected credit gains Trade receivables	For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
	2023	2022	2023	2022
	$-	$-	$-	$-

Please refer to Note 12 for more details on credit risk.

The Group measures the loss allowance of its trade receivables (including notes receivables, trade receivables and trade receivables from related parties) at an amount equal to lifetime expected credit losses. The assessments of the Group’s loss allowance as of June 30, 2023, December 31, 2022 and June 30, 2022 are as follows:

The trade receivables loss allowance is measured by using a provision matrix, details are as follows:

2023.06.30

Not past due (Note)	Within30 days	Past due		Total
		31-120 days	After 121days
$1,043,240 -	$3,700 -	$- -	$- 1%-100%	$1,046,940 -
-	-	-	-
$1,043,240	$3,700	$-	$-	$1,046,940
Not past due (Note)	Within 30 days	Past due		Total
		31-120 days	After 121 days
$723,794 -	$2,455 -	$- -	$- 1%-100%	$726,249 -
-	-	-	-
$723,794	$2,455	$-	$-	$726,249

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

2022.06.30

Not past due (Note)	Within 30 days	Past due		Total
		31-120 days	After 121 days
$777,340 -	$10,894 -	$- -	$- 1%-100%	$788,234 -
-	-	-	-
$777,340	$10,894	$-	$-	$788,234

Note: All of the Group’s notes receivables are not yet due.

(16) Leases

Group as a lessee

The Group leases various properties, including real estate such as land and buildings, and furniture and fixtures. The lease terms range from 3 to 33 years.

The Group’s leases effect on the financial position, financial performance and cash flows are as follows:

(a) Amounts recognized in the balance sheet

I. Right-of-use assets

The carrying amount of right-of-use assets

	As of
June 30, 2023	December 31, 2022	June 30, 2022
$76,454 6,707 643	$78,128 5,648 773	$79,803 7,785 903
$83,804	$84,549	$88,491

During the six-month periods ended June 30, 2023 and 2022, the additions to right-ofuse assets of the Group amounted to NT$3,289 thousand and NT$746 thousand, respectively.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

II. Lease liabilities

	As of
June 30, 2023	December 31, 2022	June 30, 2022
$7,748 79,226	$6,860 80,633	$7,005 84,157
$86,974	$87,493	$91,162

Please refer to Note 6(18)(c) for the interest on lease liabilities recognized during the six-month periods ended June 30, 2023 and 2022, and refer to Note 12(5) Liquidity Risk Management for the maturity analysis for lease liabilities.

(b) Amounts recognized in the statement of comprehensive income

Depreciation charge for right-of-use assets

For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
2023	2022	2023	2022
$837 1,064 65	$842 1,045 64	$1,674 2,112 130	$1,675 2,096 117
$1,966	$1,951	$3,916	$3,888
2023	2022	2023	2022
$422 44 324	$422 17 313	$849 44 626	$830 25 643
$790	$752	$1,519	$1,498
$159	$159	$317	$317

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(d) Cash outflow relating to leasing activities

During the six-month periods ended June 30, 2023 and 2022, the Group’s total cash outflows for leases amounted to NT$6,148 thousand and NT$5,772 thousand, respectively.

(e) Extension options

Some of the Group’s property rental agreements contain extension options. In determining the lease terms, the non-cancellable period for which the Group has the right to use an underlying asset, together with both periods covered by an option to extend the lease if the Group is reasonably certain to exercise that option. The option is used to maximize operational flexibility in terms of managing contracts. The majority of extension option held is exercisable only by the Group. After the commencement date, the Group reassesses the lease term upon the occurrence of a significant event or a significant change in circumstances that is within the control of the lessee and affects whether the Group is reasonably certain to exercise an option not previously included in its determination of the lease term.

(17) Summary statement of employee benefits, depreciation and amortization expenses by function:

	For the three-monthperiods ended	For the three-monthperiods ended	For the three-monthperiods ended	June 30,
	2023			2022
Operating costs	Operating expenses	Total	Operating costs	Operating expenses	Total
$11,621 864 503 193	$291,511 13,714 8,344 2,611	$303,132 14,578 8,847 2,804	$12,415 866 483 194	$245,830 13,544 8,001 2,609	$258,245 14,410 8,484 2,803
$13,181	$316,180	$329,361	$13,958	$269,984	$283,942
$2,006	$9,873	$11,879	$2,118	$9,346	$11,464
$-	$3,292	$3,292	$-	$1,456	$1,456

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

	For the	six-monthperiods ended June 30,	six-monthperiods ended June 30,	six-monthperiods ended June 30,
	2023			2022
Operating costs	Operating expenses	Total	Operating costs	Operating expenses	Total
$22,314 1,674 995 386	$540,013 26,568 16,506 5,220	$562,327 28,242 17,501 5,606	$25,318 1,740 948 383	$527,398 26,740 15,429 5,124	$552,716 28,480 16,377 5,507
$25,369	$588,307	$613,676	$28,389	$574,691	$603,080
$4,014	$19,417	$23,431	$4,138	$18,575	$22,713
$-	$5,920	$5,920	$-	$2,780	$2,780

According to the Articles of Incorporation, between 8% to 20% of profit of the current year is distributable as employees’ compensation and no higher than 1% of profit of the current year is distributable as remuneration to directors. However, the Company's accumulated losses shall have been covered (if any). The Company may, by a resolution adopted by a majority vote at a meeting of Board of Directors attended by two-thirds of the total number of directors, have the profit distributable as employees’ compensation in the form of shares or in cash; and in addition thereto a report of such distribution is submitted to the shareholders’ meeting. Information on the Board of Directors’ resolution regarding the employees’ compensation and remuneration to directors can be obtained from the “Market Observation Post System” on the website of the Taiwan Stock Exchange (TWSE).

Based on a specific rate of profit of current year, the Company estimated the amounts of the employees’ compensation and remuneration to directors for the three-month periods ended June 30, 2023 and June 30, 2022 to be NT$62,126 thousand, NT$6,212 thousand, NT$68,100 thousand and NT$4,540 thousand, respectively. The amounts of the employees’ compensation and remuneration to directors for the six-month periods ended June 30, 2023 and June 30, 2022 were NT$105,583 thousand, NT$10,558 thousand, NT$152,932 thousand and NT$10,195 thousand, respectively. The employees’ compensation and remuneration to directors recognized as salary expense. If the board of directors resolved to distribute employees’ compensation in the form of stocks, then the number of stocks distributed as employees’ compensation was calculated based on the closing price one day earlier than the date of resolution. If the estimated amounts differ from the actual distribution resolved by the board of directors, the Company will recognize the change as an adjustment to income of next year.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

The distributions of the employees’ compensation and remuneration to directors in cash for 2022 and 2021 were approved through the Board of Directors’ meeting on February 23, 2023 and February 24, 2022, respectively. There were no differences between the aforementioned approved amounts and the actual distribution of the employees’ compensation and remuneration to directors.

Information relevant to the aforementioned employees’ compensation and remuneration to directors can be obtained from the “Market Observation Post System” on the website of the TWSE.

(18) Non-operating income and expenses

(a) Other income

For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
2023	2022	2023	2022
$159 9,020 55	$772 3,350 118	$317 9,020 1,026	$1,544 26,658 1,027
$9,234	$4,240	$10,363	$29,229

(b) Other gains and losses

For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
2023	2022	2023	2022
$6,051 2,583 -	$608 (2,990) (7)	$3,670 3,018 (5)	$2,524 (11,298) (102)
$8,634	$(2,389)	$6,683	$(8,876)

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Note: Balances were arising from financial assets mandatorily measured at fair value through profit or loss, including valuation adjustment, interest income and exchange difference, etc.

(c) Finance costs

For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
2023	2022	2023	2022
$404 -	$449 1	$822 -	$910 1
$404	$450	$822	$911

(19) Components of other comprehensive income (loss)

For the three-month period ended June 30, 2023

Items that may not be reclassified subsequently to profit or loss Unrealized gains (losses) from equity instrument investments measured at fair value through other comprehensive income Items that may be reclassified subsequently to profit or loss Exchange differences resulting from translating the financial statements of foreign operations Total	Arising during the period	Reclassification adjustments during the period	Other comprehensive income (loss), before tax	Income tax relating to components of other comprehensive income	Other comprehensive income (loss), net oftax
	$43,004 (103)	$- -	$43,004 (103)	$(640) -	$42,364 (103)
	$42,901	$-	$42,901	$(640)	$42,261

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

For the three-month period ended June 30, 2022

Arising during the period	Reclassification adjustments during the period	Other comprehensive income (loss), before tax	Income tax relating to components of other comprehensive income	Other comprehensive income (loss), net oftax
$(229,758) (57)	$- -	$(229,758) (57)	$4,028 -	$(225,730) (57)
$(229,815)	$-	$(229,815)	$4,028	$(225,787)
		Other comprehensive income (loss), before tax	Income tax relating to components of other comprehensive income	Other comprehensive income (loss), net of tax
$291,758 (81)	$- -	$291,758 (81)	$(1,864) -	$289,894 (81)
$291,677	$-	$291,677	$(1,864)	$289,813

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

For the six-month period ended June 30, 2022

Items that may not be reclassified subsequently to profit or loss Unrealized gains (losses) from equity instrument investments measured at fair value through other comprehensive income Items that may be reclassified subsequently to profit or loss Exchange differences resulting from translating the financial statements of foreign operations Total	Arising during the period	Reclassification adjustments during the period	Other comprehensive income (loss), before tax	Income tax relating to components of other comprehensive income	Other comprehensive income (loss), net oftax
	$(532,017) 62	$- -	$(532,017) 62	$7,748 -	$(524,269) 62
	$(531,955)	$-	$(531,955)	$7,748	$(524,207)

(20) Income tax

(a) The major components of income tax expense are as follows:

Income tax expense (income) recognized in profit or loss

For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
2023	2022	2023	2022
$118,660 (4,247) 1,092	$96,897 (3,720) (6,866)	$195,696 (37,122) 1,756	$194,852 (28,079) (9,956)
$115,505	$86,311	$160,330	$156,817

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Income tax relating to components of other comprehensive income

Deferred tax expense (income): Unrealized gains or losses from equity instrument investments measured at fair value through other comprehensive income	For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
	2023	2022	2023	2022
	$640	$(4,028)	$1,864	$(7,748)

(b) The assessment of income tax returns

As of June 30, 2023, the assessment of the income tax returns of the Company and its subsidiaries is as follows:

ITE Tech. Inc. Subsidiary–ITE Tech. (ShenZhen) Inc.	The assessment of income tax returns
	Assessed and approved up to 2021 Assessed to 2022

(21) Earnings per share

Basic earnings per share amounts are calculated by dividing net profit for the period attributable to ordinary equity holders of the parent entity by the weighted average number of ordinary shares outstanding during the period.

Diluted earnings per share amounts are calculated by dividing the net profit attributable to ordinary equity holders of the parent entity by the weighted average number of ordinary shares outstanding during the period plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
2023	2022	2023	2022
$437,429	$295,110	$779,374	$699,664
161,080,124	161,080,124	161,080,124	161,080,124
$2.72	$1.83	$4.84	$4.34
$437,429	$295,110	$779,374	$699,664
161,080,124 938,513	161,080,124 2,163,110	161,080,124 1,493,216	161,080,124 3,150,843
162,018,637	163,243,234	162,573,340	164,230,967
$2.70	$1.81	$4.79	$4.26

There have been no other transactions involving ordinary shares or potential ordinary shares between the reporting date and the issuance date of the financial statements.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

7. Related Party Transactions

Information of the related parties that had transactions with the Group during the financial reporting period is as follows:

Name and nature of relationship of the related parties

Names of related parties	Nature of relationship oftherelated parties
United Microelectronics Corp. HeJian Technology (Suzhou) Co., Ltd. Wavetek Microelectronics Corporation Emright Technology Co., Ltd.	Director of the Group Other related party Other related party Associate

Significant transactions with the related parties

(1) Sales

Sales
Associate	For the three-month periods ended June 30,		For the six-month periods ended June 30,
	2023 $1,135	2022	2023	2022
		$-	$1,135	$2,263

The sales price to the above related party was determined through mutual agreement in reference to market conditions. The payment term for the related party was 30 days after month-end.

(2) Purchases

For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
2023	2022	2023	2022
$146,447 87,657 -	$270,292 134,244 556	$225,096 181,298 -	$529,476 238,715 1,048
$234,104	$405,092	$406,394	$769,239

The purchase prices to the above related parties were not comparable to the market due to differentiation of manufacturing process and product specification. Payment terms to related parties were 45 days after month-end.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(3) Trade receivables from related parties

Trade receivables from related parties
Associate Trade payables to related parties United Microelectronics Corp. HeJian Technology (Suzhou) Co., Ltd. Other related party Total Other payables to related parties United Microelectronics Corp. Other related party Total		As of
	June 30, 2023	December 31, 2022	June 30, 2022
	$1,210	$-	$-
		As of
	June 30, 2023	December 31, 2022	June 30, 2022
	$101,993 67,853 -	$77,846 32,004 -	$174,825 85,451 287
	$169,846	$109,850	$260,563
		As of
	June 30, 2023	December 31, 2022	June 30, 2022 $14,718 - $14,718
	$12,946 94	$6,565 -
	$13,040	$6,565

(4) Trade payables to related parties
(5) Other payables to related parties
(6) The Group purchased masks and other from the director of the Group and recognized NT$24,353 thousand, NT$21,656 thousand, NT$37,157 thousand and NT$42,838 thousand as manufacturing expenses and operating expenses for the three-month and six-month periods ended June 30, 2023 and 2022, respectively. Payment term for the related party was 45 days after month-end.
(7) The Group had transactions with other related parties and recognized NT$92 thousand, NT$0, NT$92 thousand and NT$277 thousand as manufacturing expenses for the three-month and six-month periods ended June 30, 2023 and 2022, respectively. Payment terms for related parties were 45 days after month-end .
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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(8) Key management personnel compensation

For the three-month periods ended June 30,	For the three-month periods ended June 30,	For the six-month periods ended June 30,	For the six-month periods ended June 30,
2023 $20,727 487 $21,214	2022	2023	2022
	$20,523 444	$48,053 971	$53,940 880
	$20,967	$49,024	$54,820

8. Assets Pledged as Security

The following table lists assets of the Group pledged as security:

Assetspledged for security		As of	Secured liabilities
	June 30, 2023	December 31, 2022
Financial assets measured at amortized cost – current Financial assets measured at amortized cost – non-current Total	$2,200 2,030	$- 4,230	Guarantee for land Guarantee for land
	$4,230	$4,230

9. Significant Contingencies and Unrecognized Contractual Commitments

The Group uses patents of other companies for certain products, and has paid royalty fees based on sales amounts or quantities of these products in accordance with the agreements.

10.Losses Due to Major Disasters

None.

11.Significant Subsequent Events

None.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

12.Others

(1) Categories of financial instruments

	As of
June 30, 2023	December 31, 2022	June 30, 2022
$138,744 1,397,177 4,639,429	$752,505 1,154,912 2,518,492	$1,806,578 1,299,991 2,706,044
$6,175,350	$4,425,909	$5,812,613
	As of
June 30, 2023	December 31, 2022	June 30, 2022
$2,045,929 86,974 28,290	$845,944 87,493 28,290	$2,699,106 91,162 28,483
$2,161,193	$961,727	$2,818,751

Note: Including cash and cash equivalents (excluding cash on hand), financial assets measured at amortized cost, notes receivables, trade receivables (including related parties), other receivables and other non-current assets (refundable deposits).

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(2) Financial risk management objectives and policies

The Group’s principal financial risk management objective is to manage the market risk, credit risk and liquidity risk related to its operating activities. The Group identifies, measures and manages the aforementioned risks based on the Group’s policy and risk appetite.

The Group has established appropriate policies, procedures and internal controls for financial risk management. Before entering into significant transactions, due approval process by the Board of Directors and Audit Committee must be carried out based on related protocols and internal control procedures. The Group complies with its financial risk management policies at all times.

(3) Market risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of the changes in market prices. Market risks comprise currency risk, interest rate risk and other price risk (such as equity instruments).

In practice, it is rarely the case that a single risk variable will change independently from other risk variables, there are usually interdependencies between risk variables. However, the sensitivity analysis disclosed below does not take into account the interdependencies between risk variables.

Foreign currency risk

The Group’s exposure to the risk of changes in foreign exchange rates relates primarily to the Group’s operating activities (when revenues or expenses are denominated in a different currency from the Group’s functional currency) and the Group’s net investments in foreign subsidiaries.

The Group has certain foreign currency receivables to be denominated in the same foreign currency with certain foreign currency payables, therefore natural hedge is received. Furthermore, as net investments in foreign subsidiaries are for strategic purposes, they are not hedged by the Group.

The foreign currency sensitivity analysis of the possible change in foreign exchange rates on the Group’s profit is performed on significant monetary items denominated in foreign currencies as of the end of the reporting period. The Group’s foreign currency risk is mainly related to the volatility in the exchange rates for USD. The information of the sensitivity analysis is as follows:

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

When NTD strengthens/weakens against USD by 5%, the profit for the six-month periods ended June 30, 2023 and 2022 would decrease/increase by NT$13,832 thousand and NT$1,873 thousand, respectively.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Group doesn’t have any liabilities risk of changes in market interest rates. Therefore, the Group expects no fair value and cash flow risks due to significant interest rate fluctuations.

All of the Group’s financial assets and financial liabilities that are exposed to cash flow risk due to fluctuating interest rate are under short term contracts, thus the cash flow risk of fluctuate interest is considerably low.

The interest rate sensitivity analysis is performed on items exposed to interest rate risk as of the end of the reporting period, including investments with variable interest rate. At the reporting date, an increase/decrease of 10 basis points (0.1%) of interest rate in a reporting period could cause the profit for the six-month periods ended June 30, 2023 and 2022 to increase/decrease by NT$0 and NT$1 thousand, respectively.

Equity price risk

The Group’s listed and unlisted equity securities are susceptible to market price risk arising from uncertainties about future values of the investment objectives. The Group’s listed and unlisted equity securities are classified as financial assets at fair value through profit or loss and financial assets at fair value through other comprehensive income. The Group manages the equity price risk through diversification and placing limits on individual and total equity instruments. Reports on the equity portfolio are submitted to the Group’s senior management on a regular basis. The Board of Directors reviews and approves certain equity investments according to level of authority.

For the six-month periods ended June 30, 2023 and 2022, a change of 10% in the price of the listed equity instrument investments measured at fair value through other comprehensive income could increase/decrease by NT$29,246 thousand and NT$29,891 thousand, respectively.

Please refer to Note 12(8) for sensitivity analysis information of other equity instruments that are linked to such equity instruments whose fair value measurement is categorized under Level 3 of the fair value hierarchy.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(4) Credit risk management

Credit risk is the risk that counterparty will not meet its obligations under a contract, leading to a financial loss. The Group is exposed to credit risk from operating activities (primarily for trade receivables and notes receivables) and from its financing activities, including bank deposits and other financial instruments.

Credit risk is managed by each business unit subject to the Group’s established policy, procedures and control relating to credit risk management. Credit limits are established for all counter parties based on their financial position, rating from credit rating agencies, historical experience, prevailing economic condition and the Group’s internal rating criteria, etc. Certain counter parties’ credit risk will also be managed by taking credit enhancing procedures, such as requesting for prepayment.

As of June 30, 2023, December 31, 2022 and June 30, 2022, trade receivables from top ten customers represented 96.02%, 98.04% and 92.45% of the total trade receivables of the Group, respectively. The credit concentration risk of other trade receivables is insignificant.

Credit risk from balances with banks and other financial instruments is managed by the Group’s treasury in accordance with the Group’s policy. The Group only transacts with counterparties approved by the internal control procedures, which are banks and financial institutions and companies with good credit rating. Consequently, there is no significant credit risk for these counter parties.

The Group adopted IFRS 9 to assess the expected credit losses. Except for trade receivables, for debt instrument investments which are not measured at fair value through profit or loss and are at low credit risk upon acquisition, an assessment is made at each reporting date as to whether the credit risk has substantially increased in order to determine the method of measuring the loss allowance and the loss ratio. The measurement indicators of the Group are described as follows:

Levelofcreditrisk	Indicator	Measurement method forexpected creditlosses	Gross carryingamount as of	Gross carryingamount as of	Gross carryingamount as of
			June 30, 2023	December 31, 2022	June 30, 2022
Simplified approach (Note)	(Note)	Lifetime expected credit losses	$1,046,940	$726,249	$788,234

Note: By using simplified approach (loss allowance is measured at lifetime expected credit losses), including notes receivables, trade receivables and trade receivables from related parties.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Financial assets are written off when there is no realistic prospect of future recovery.

(5) Liquidity risk management

The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use of cash and cash equivalents and financial assets and liabilities at fair value through profit or loss. The table below summarizes the maturity profile of the Group’s financial liabilities based on the contractual undiscounted payments and contractual maturity. The payment amount includes the contractual interest.

Non-derivative financial liabilities

June 30, 2023 Payables (including related parties) Lease liabilities Deposits received December 31, 2022 Payables (including related parties) Lease liabilities Deposits received June 30, 2022 Payables (including related parties) Lease liabilities Deposits received	Less than 1year	2 to 3years	4 to 5years	5 to 15 years	15 to 20 years	> 20years	Total
	$2,045,929 $9,213 $- $845,944 $8,402 $- $2,699,106 $8,661 $-	$- $10,320 $28,290 $- $11,148 $28,290 $- $13,252 $28,483	$- $9,381 $- $- $8,495 $- $- $8,566 $-	$- $41,856 $- $- $41,856 $- $- $41,856 $-	$- $14,727 $- $- $15,733 $- $- $16,738 $-	$- $19,209 $- $- $20,296 $- $- $21,383 $-	$2,045,929 $104,706 $28,290 $845,944 $105,930 $28,290 $2,699,106 $110,456 $28,483

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(6) Reconciliation of liabilities arising from financing activities

Reconciliation of liabilities for the six-month periods ended June 30, 2023 and 2022:

Deposits received	Lease liabilities	Total liabilities from financing activities
$28,290 - -	$87,493 (3,808) 3,289	$115,783 (3,808) 3,289
$28,290	$86,974	$115,264
$28,483 - -	$93,772 (3,356) 746	$122,255 (3,356) 746
$28,483	$91,162	$119,645

(7) Fair value of financial instruments
(a) The methods and assumptions applied in determining the fair value of financial instruments:

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following methods and assumptions were used by the Group to measure or disclose the fair values of financial assets and financial liabilities:

I. The carrying amount of cash and cash equivalents, trade receivables (including related parties), other receivables, other non-current assets, payables (including related parties) and deposits received approximate their fair value due to their short maturities.
II. For financial assets and liabilities traded in an active market with standard terms and conditions, their fair value is determined based on market quotation price (including listed equity securities and funds) at the reporting date.
III.Fair value of equity instruments without market quotations (including private company equity securities) is estimated using the market approach valuation techniques based on parameters such as prices based on market transactions of equity instruments of identical or comparable entities and other relevant information (for example, inputs such as discount for lack of marketability, P/E ratio of similar entities and Price-Book ratio of similar entities).
46 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(b) Fair value of financial instruments measured at amortized cost

The carrying amounts of the Group’s financial assets and liabilities measured at amortized cost approximate their fair value.

Please refer to Note 12(8) for fair value measurement hierarchy for financial instruments of the Group.

(8) Fair value measurement hierarchy
(a) Fair value measurement hierarchy

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, based on the lowest level input that is significant to the fair value measurement as a whole. Level 1, 2 and 3 inputs are described as follows:

Level 1 – Quoted (unadjusted) market prices in active markets for identical assets or liabilities that the entity can access at the measurement date.

Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3 – Unobservable inputs for the assets or liabilities.

For assets and liabilities that are recognized in the financial statements on a recurring basis, the Group determines whether transfers have occurred between Levels in the hierarchy by re-assessing categorization at the end of each reporting period.

(b) Fair value measurement hierarchy of the Group’s assets and liabilities

The Group does not have assets that are measured at fair value on a non-recurring basis. Fair value measurement hierarchy of the Group’s assets and liabilities measured at fair value on a recurring basis is as follows:

47 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

As of June 30, 2023:

Level 1	Level 2	Level3	Total
$30,546 - 292,462	$- - -	$- 108,198 1,104,715	$30,546 108,198 1,397,177
$323,008	$-	$1,212,913	$1,535,921
Level 1	Level 2	Level 3	Total
$687,419 - 200,942	$- - -	$- 65,086 953,970	$687,419 65,086 1,154,912
$888,361	$-	$1,019,056	$1,907,417
Level 1	Level 2	Level3	Total
$1,762,147 - 298,913	$- - -	$- 44,431 1,001,078	$1,762,147 44,431 1,299,991
$2,061,060	$-	$1,045,509	$3,106,569

48 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Transfers between Level l and Level 2 during the period

During the six-month periods ended June 30, 2023 and 2022, there were no transfers between Level 1 and Level 2 fair value measurements.

Movements of fair value measurement in level 3 on recurring basis

Reconciliation for fair value measurements in Level 3 of the fair value hierarchy for movements during the period is as follows:

	Assets
At fair value through profit or loss	At fair value through other comprehensive income	Total
Capital	Stocks
$65,086 (6,901) - 50,013 -	$953,970 - 163,245 37,500 (50,000)	$1,019,056 (6,901) 163,245 87,513 (50,000)
$108,198	$1,104,715	$1,212,913
	Assets
At fair value through profit or loss	At fair value through other comprehensive income	Total
Capital	Stocks
$- (8,661) - 53,092 - -	$1,795,607 - (516,112) - (6,950) (271,467)	$1,795,607 (8,661) (516,112) 53,092 (6,950) (271,467)
$44,431	$1,001,078	$1,045,509

49 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Recognized as gains (losses) above, the loss from financial assets still held by the Group as of June 30, 2023 and 2022 was NT$6,901 thousand and NT$8,661 thousand, respectively.

Information on significant unobservable inputs to valuation

Description of significant unobservable inputs to valuation of recurring fair value measurements categorized within Level 3 of the fair value hierarchy is as follows:

As of June 30, 2023

Financial assets: Financial assets at fair value through profit or loss Capital Financial assets at fair value through other comprehensive income Stocks Stocks	Valuation technique	Significant unobservableinputs	Quantitative information	Relationship between inputs andfairvalue	Sensitivity analysis of the input tofairvalue
	Asset approach Market approach Asset approach	Discount for lack of marketability Discount for lack of marketability Discount for lack of marketability	10% 30% 10%	The higher the discount for lack of marketability, the lower the fair value estimated The higher the discount for lack of marketability, the lower the fair value estimated The higher the discount for lack of marketability, the lower the fair value estimated	10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s profit (loss) by NT$10,820 thousand 10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s equity by NT$13,746 thousand 10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s equity by NT$96,725 thousand

50 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

As of December 31, 2022

Financial assets: Financial assets at fair value through profit or loss Capital Financial assets at fair value through other comprehensive income Stocks Stocks	Valuation technique	Significant unobservable inputs	Quantitative information	Relationship between inputs and fair value	Sensitivity analysis of the input to fair value
	Asset approach Market approach Asset approach	Discount for lack of marketability Discount for lack of marketability Discount for lack of marketability	10% 30% 10%	The higher the discount for lack of marketability, the lower the fair value estimated The higher the discount for lack of marketability, the lower the fair value estimated The higher the discount for lack of marketability, the lower the fair value estimated	10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s profit (loss) by NT$6,509 thousand 10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s equity by NT$9,368 thousand 10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s equity by NT$86,029 thousand

51 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

As of June 30, 2022

Financial assets: Financial assets at fair value through profit or loss Capital Financial assets at fair value through other comprehensive income Stocks Stocks	Valuation technique	Significant unobservable inputs	Quantitative information	Relationship between inputs and fair value	Sensitivity analysis of the input to fair value
	Asset approach Market approach Asset approach	Discount for lack of marketability Discount for lack of marketability Discount for lack of marketability	10% 30% 10%	The higher the discount for lack of marketability, the lower the fair value estimated The higher the discount for lack of marketability, the lower the fair value estimated The higher the discount for lack of marketability, the lower the fair value estimated	10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s profit (loss) by NT$4,443 thousand 10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s equity by NT$8,363 thousand 10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s equity by NT$91,745 thousand

52 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Valuation process used for fair value measurements categorized within Level 3 of the fair value hierarchy

The Group validates the fair value measurements and ensures that the results of the valuation are in line with market conditions, based on independent and reliable inputs which are consistent with other information, and represent exercisable prices. The Group also analyses the movements in the values of assets and liabilities which are required to be re-measured or re-assessed based on the Group’s accounting policies at each reporting date.

(9) Significant assets and liabilities denominated in foreign currencies

Information regarding the significant financial assets and liabilities denominated in foreign currencies is listed below:

Financial assets			As	of	of	of
		June 30, 2023		December 31, 2022
	Foreign currencies (In thousands)	Foreign exchange rate	NTD (In thousands)	Foreign currencies (In thousands)	Foreign exchange rate	NTD (In thousands)
	$15,768 $6,884	As of 31.14 31.14	$491,003 $214,370	$9,972 $4,298	30.725 30.725	$306,403 $132,061
Monetary items: USD Financial liabilities
Financial assets Monetary items: USD
		June 30, 2022
	Foreign currencies (In thousands)	Foreign exchange rate	NTD (In thousands)
	$11,288 $10,028	29.735 29.735	$335,639 $298,174
Monetary items: USD Financial liabilities
Monetary items: USD

53 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

The Group does not disclose all of information regarding the assets and liabilities denominated in foreign currencies due to the varieties of foreign currency transactions. During the three-month and six-month periods ended June 30, 2023 and 2022, the foreign exchange gains were NT$6,051 thousand, NT$608 thousand, NT$3,670 thousand and NT$2,524 thousand, respectively.

The above information is disclosed based on the carrying amount of foreign currency (after conversion to functional currency).

(10) Capital management

The primary objective of the Group’s capital management is to ensure that it maintains a strong credit rating and healthy capital ratios in order to support its business and maximize shareholder value. The Group manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To maintain or adjust the capital structure, the Group may adjust dividend payment to shareholders, return capital to shareholders or issue new shares.

54 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

13.Additional Disclosure

(1) Information at significant transactions

Additional disclosures for information of the Company for the six-month period ended June 30, 2023:

(a) Financing provided to others: None.

(b) Endorsement/Guarantee provided to others: None.
(c) Marketable securities held as of June 30, 2023 (excluding subsidiaries, associates and joint ventures):

Held Company Name	Marketable Securities Type and Name	Marketable Securities Type and Name	Relationship with the Company	Financial Statement Account		June 30,2023	June 30,2023
					Shares/Units	Carrying Value/ Thousands ofNTD	Percentage of Ownership (%)	Fair Value/ Thousands of NTD
ITE Tech. Inc.	Common Stock	Unitech Capital, Inc.	-	Financial assets at fair value through other comprehensiveincome,non-current	2,000,000	$45,940	4.00%	$45,940
	Common Stock	Shieh Yong Investment Co., Ltd.	-	Financial assets at fair value through other comprehensiveincome,non-current	32,506,937	$269,157	1.52%	$269,157
	Common Stock	Darjun Venture Corporation	-	Financial assets at fair value through other comprehensiveincome,non-current	9,280,000	$88,160	19.61%	$88,160
	Common Stock	TriKnight Capital Corporation	-	Financial assets at fair value through other comprehensive income,non-current	35,841,800	$259,495	5.00%	$259,495
	Common Stock	Darhe II Venture Corporation	-	Financial assets at fair value through other comprehensiveincome,non-current	10,000,000	$91,500	14.29%	$91,500
	Common Stock	Darchan Venture Corporation	-	Financial assets at fair value through other comprehensiveincome,non-current	20,000,000	$179,400	18.18%	$179,400
	Common Stock	Darjiun Venture Corporation	-	Financial assets at fair value through other comprehensiveincome,non-current	3,750,000	$33,600	10.00%	$33,600
	Common Stock	Generiton Co., Ltd.	-	Financial assets at fair value through other comprehensiveincome,non-current	508,047	$31,225	12.70%	$31,225
	Common Stock	Embestor Technology Inc.	-	Financial assets at fair value through other comprehensiveincome,non-current	4,400,000	$88,528	16.92%	$88,528

55 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Held Company Name	Marketable Securities Type and Name	Marketable Securities Type and Name	Relationship with the Company	Financial Statement Account	June 30,2023	June 30,2023	June 30,2023
					Shares/Units	Carrying Value/ Thousands ofNTD	Percentage of Ownership (%)	Fair Value/ Thousands of NTD
ITE Tech. Inc.	Common Stock	Isentek Inc.	-	Financial assets at fair value through other comprehensive income, non-current	1,000,000	$17,710	3.30%	$17,710
	Common Stock	A-Tec Subsystem Inc.	-	Financial assets at fair value through other comprehensiveincome,non-current	500,000	$-	9.90%	$-
	Common Stock	Gigastone Corporation	-	Financial assets at fair value through other comprehensiveincome,non-current	1,734,841	$31,383	3.42%	$31,383
	Common Stock	M3 Technology Inc.	-	Financial assets at fair value through other comprehensive income, non-current	1,729,000	$261,079	4.18%	$261,079
	Fund	Yuanta/P-shares Taiwan Dividend Plus ETF	-	Financial assets at fair value through profit or loss, non-current	935,000	$30,546	-	$30,546
	Capital	TGVest Asia Partners II (Taiwan),L.P.	-	Financial assets at fair value through profit or loss, non-current	-	$108,198	-	$108,198

(d) Individual securities acquired or disposed of with accumulated amount exceeding the lower of NT$300 million or 20 percent of the capital stock:

Amount: Thousands of NTD

Company Name	Marketable Securities Type and Name	Financial Statement Account	Counter- party	Nature of Relationship	Beginning	balance	Acquisition	Acquisition		Disposal	Disposal		Endingbalance	Endingbalance
					Units	Amount	Units	Amount	Units	Amount	Carrying Value	Gains (Losses) on Disposal	Units	Amount
ITE Tech. Inc.	Taishin 1699 Money Market Fund	Financial assets at fair value through profit or loss, current	-	-	29,197,160.70	$401,905	4,356,222.86	$60,000	33,553,383.56	$463,993	$460,000	$3,993	-	$-

56 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(e) Acquisition of individual real estate with amount exceeding the lower of NT$300 million or 20 percent of the capital stock: None.

(f) Disposal of individual real estate with amount exceeding the lower of NT$300 million or 20 percent of the capital stock: None.

(g) Related party transactions for purchases and sales amounts exceeding the lower of NT$100 million or 20 percent of the capital stock:

Amount: Thousands of NTD

Company Name	Related Party	Nature of Relationship		Transaction Details	Transaction Details		Abnormal Transaction	Abnormal Transaction	Notes/Trade (Payable) or Receivable	Notes/Trade (Payable) or Receivable
			Purchases/ Sales	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
ITE Tech. Inc.	United Microelectronics Corp.	Directors of the Company	Purchases	$225,096	50.88%	45 days after month-end	Not comparable to the market due to differentiation of manufacturing process and product specification	Same as general trading conditions	$(101,993)	(18.49)%
	HeJian Technology (Suzhou) Co., Ltd.	Other related party	Purchases	$181,298	40.98%	45 days after month-end	Not comparable to the market due to differentiation of manufacturing process and product specification	Same as general trading conditions	$(67,853)	(12.30)%

(h) Receivables from related parties with amounts exceeding the lower of NT$100 million or 20 percent of capital stock as of June 30, 2023: None.
(i) Trading in derivative instruments: None.
57 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(j) Intercompany relationship and significant intercompany transactions:

No. (Note 1)	Company Name	Counter Party	Nature of Relationship (Note 2)		IntercompanyTransactions	IntercompanyTransactions	IntercompanyTransactions
				Financial Statement Item	Amount	Term	Percentage of Consolidated Net Revenue or Total Assets (Note 3)
0	ITE Tech. Inc.	ITE Tech. (Shenzhen) Inc.	1	Administrative expenses	$19,101	On demand	0.63%

Note 1: Number should be input in the remark column for intercompany transactions. Here illustrate how to assign numbers to transactions. 1. 0 for parent company.
Subsidiaries are given a number in sequence starting with No. 1.
Note 2: There are three types of transactions. Please remark the type of transaction by giving a number to it. 1. Parent to Subsidiary.
Subsidiary to Parent.
Subsidiaries to Subsidiaries.
Note 3: Asset/liability items are calculated by using the ending balances of the item divided by ending balance of total consolidated assets; Profit/loss items are calculated by using the amount of the transaction divided by total consolidated revenue.
58 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(2) Information on investees

Names, locations and related information of investees as of June 30, 2023 (excluding investment in Mainland China):

Amount: Thousands of NTD

	Investor Company	Investor Company	Investee Company	Investee Company	Investee Company	Location	Main Businesses and Products	Main Businesses and Products	Original Investment Amount	Original Investment Amount	Original Investment Amount	Original Investment Amount	Balances as of June 30,2023	Balances as of June 30,2023	Balances as of June 30,2023	Balances as of June 30,2023	Net Income (losses) of the Investee Company	Net Income (losses) of the Investee Company	Share of Profits /(Losses)	Share of Profits /(Losses)
									June 30, 2023		December 31, 2022		Shares	Percentage of Ownership		Carrying Value
	ITE Tech. Inc.		Emright Technology Co., Ltd.			Taiwan	Communication machinery equipment, electronic components manufacturing		$41,768		$41,768		4,176,800	30.15%		$16,633	$(14,725)		$(4,936)
	(3)Investment in Mainland China (a) Investment situation:															Amount: US Dollars/Thousands of
Investee Company		Main Businesses and Products		Total Amount of Paid-in Capital (Note 4)	Method of Investment			Accumulated outflow of Investment from Taiwan as of January 1, 2023 (Note 4)	Investment		Flows	Accumulated outflow of Investment from Taiwan as ofJune 30, 2023 (Note 4)		Percentage of Ownership	Net Income (Losses) of the Investee Company		Share of Profits /(Losses) (Note 3)	Carrying Amount as of June 30, 2023 (Note 3)		Accumulated Inward Remittance of Earnings as of June 30, 2023
									Outflow	Inflow
ITE Tech. (Shenzhen) Inc.		Technological consultation services for ICsproducts		$18,684 USD 600,000	Direct investment in Mainland China (Note 1)			$18,684 USD 600,000	$-	$-		$18,684 USD 600,000		100%	$433		$433	$2,850		$-

59 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Accumulated Investment in Mainland China as of June 30,2023	Investment Amounts Authorized by Investment Commission,MOEA	Upper Limit on Investment
$18,684 (Note 4) (USD600,000)	$18,684 (Note 4) (USD600,000)	$3,297,250 (Note 2)

Note 1: The Company has been approved the investment which that changed the investment structure and directly invested in ITE Tech. (Shenzhen) Inc. by the Investment Commission, MOEA.
Note 2: lBased on Regulations Governing the Approval of Investment or Technical Cooperation in the Mainland China promulgated by Investment Commission, MOEA.
Note 3: According to regulations, it may be evaluated based on the financial statements of the investee company un-reviewed by the accountant during the same period.
Note 4: Converted to NTD at the exchange rate on the financial reporting date (1 USD=31.14 NTD).
(b) Significant direct or indirect transactions with the investees in Mainland China:
I. The amount and percentage of purchases and the balance and percentage of the related payables at the end of the period: None. II. The amount and percentage of sales and the balance and percentage of the related receivables at the end of the period: None. III.The amount of property transactions and the amount of the resultant gains or losses: None.
IV.The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the end of the period and the purposes: None.
V. The highest balance, the end of period balance, the interest rate range, and total current period interest with respect to financing of funds: None.
VI.Other transactions that have a material effect on the profit or loss for the period or on the financial position, such as the rendering or receiving of services: Please refer to Note 13(1) (j).
60 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(4) Information of major shareholders

Name of major shareholders	Number of shares held (shares)	Percentage of ownership
United Microelectronics Corp.	13,959,978	8.66%

14.Segment information

General Information

The products of the Group are all related to integrated circuit design products and the chief operating decision maker reviews the Group’s operating results as a whole to make decisions about resources to be allocated and assess its performance; therefore, the Group is considered a single segment. The preparation basis of the segment is the same with the preparation of this financial statements, and the policies are the same with those mentioned in Note 4, Summary of Significant Accounting Policies.

61 -

AI assistant

ITE — Interim / Quarterly Report 2023

52248_rns_2023-11-20_000ea4ad-48a9-42d0-973e-ee58065c8f10.pdf

English Translation of a Report and Consolidated Financial Statements Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES

Notice to Readers

Independent Auditors’ Review Report Translated from Chinese

Introduction

Scope of Review

Basis for Qualified Conclusion

Qualified Conclusion

Notice to Readers

English Translation of Consolidated Financial Statements Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

June 30, 2023, December 31, 2022 and June 30, 2022

English Translation of Consolidated Financial Statements Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

June 30, 2023, December 31, 2022 and June 30, 2022

English Translation of Consolidated Financial Statements Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the three-month and six-month periods ended June 30, 2023 and 2022

English Translation of Consolidated Financial Statements Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For the six-month periods ended June 30, 2023 and 2022

English Translation of Consolidated Financial Statements Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS For the six-month periods ended June 30, 2023 and 2022 (Expressed in Thousands of New Taiwan Dollars)

1. Organization and Operation

2. Date and Procedures of Authorization of Financial Statements for Issue

3. Newly Issued or Revised Standards and Interpretations

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

4. Summary of Significant Accounting Policies

Preparation principle of consolidated financial statements

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

5. Significant Accounting Judgments, Estimates and Assumptions

6. Contents of Significant Accounts

(1) Cash and cash equivalents

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(4) Financial assets measured at amortized cost

(5) Notes receivables

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(6) Trade receivables and trade receivables from related parties

(7) Inventories

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(8) Investments accounted for using the equity method

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(9) Property, plant and equipment

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(10) Intangible assets

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(11) Other current liabilities

(12) Post-employment benefits plans

Defined contribution plan

Defined benefit plan

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(13) Equity

(a) Common stock

(b) Capital surplus

(c) Retained earnings and dividend policies

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(14) Operating revenues

(a) Contract balances

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(15) Expected credit gains

2023.06.30

ITE TECH. INC. AND SUBSIDIARIES

ITE Interim / Quarterly Report 2023